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A Pad Thai and a Beer Might Just Help Save the World

The pandemic continues to impact our lives in many ways and one of the hardest-hit areas of the community has been the Hospitality Industry.

Spare a thought for the hundreds of hardworking local Thai Restaurants struggling to make ends meet, the hundreds of staff who have been displaced and the supply chains that depend on a thriving hospitality sector for their livelihood.

We spoke to Boston (P’kae) a good friend of TAN and the proprietor of Ying Thai 2 Restaurant in Lygon Street Carlton – he typifies the challenges facing so many restaurants.

He speaks of extended closure periods, restricted trading hours for takeaway food only and limited capacity for guests when in house dining is allowed. All making it difficult to just break even.

Most restaurants report a reduction in revenue of 50% - 60%.

The shift to takeaway dining has seen food delivery charges of up to 30% of the bill for delivery services and restaurants have little choice to accept.

Some suburban and country outlets are lucky if they are the only restaurant within a 5km range, they have seen sustained business demand and are likely to recover quicker.

Working from home, a smaller international student population and less inner-city activity, has dealt a heavy blow to CBD restaurants and they have been hit hardest.

Restaurants still have to meet the cost of rates, body corporate fees, rent, insurances, utilities and other fixed costs.

A by-product of the pandemic that impacts operators has been rising costs in the supply chain.

Rob Fraser from Tangola Food reports that an increase in freight costs and delays in shipping have caused supply delays and increased costs.

Due to COVID, the closure of some factories in China and Thailand has had an impact on distribution.

Restaurants depend on strong food and beverage sales for success and there has been a huge drop in beverage sales due to the shift to take away meals.

We spoke to Khun Atthasit Limskul at Singha Beer and he advised the shift away from in house dining has seen sales fall dramatically.

Again, the bigger CBD outlets have been hit hardest, as on-premises revenue plummets with no draught beer sales and limited package beer sales - competition is strong from the big retail beverage chains.

Perhaps one of the most significant issues facing restaurants are staffing matters. Staff have been stood down in order to save costs, causing great hardship for many.

Hundreds of Thai students, a traditional source of good skilled labour, have returned home to Thailand.

Restaurants looking to replace these staff are facing skills issues and supply & demand has forced the cost of labour up as staff vie for the best pay rates.

The hospitality industry has cried out for assistance and the government has set up various support funds providing financial support for operators and staff alike.

Tenancy relief for rent is also vital and some landlords are rewarding loyalty and others not so as they have mortgage commitments to consider.

All of this is making it extremely difficult to survive and many businesses have chosen not to trade and many have closed. The likelihood of more closures increases as time goes by.

Remember the majority of our favourite Thai Restaurants are sole traders - mum and dad businesses run by good people, who came to Australia for a better life and contribute to the nation’s economy. They are doing it tough and they deserve our support.

So next time you are thinking of ordering takeaway, remember one Pad Thai and a beer might just help to save the world.

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