Financial hardship from COVID-19 restrictions could mean the permanent closure of many restaurants in Saskatchewan.
Currently part of phase three of the Re-Open Saskatchewan Plan, many food service business in the province say they are in need of more working capital if they hope to eventually open their doors and dinning rooms once again.
According to a survey conducted by Restaurants Canada, at least one in five restaurants are dealing with a landlord that is not willing to provide rent relief, either through the CECRA program or some other arrangement.
Fourteen percent of independent restaurants haven’t been able to pay April’s rent, and nearly 20 percent cannot pay rent for May, despite offering take-out and delivery services.
Mark von Schellwitz, Restaurant Canada’s V.P for western Canada, said there is also concern that business will be slow thanks to fear when restaurants finally do re-open.
“Certainly we want to make sure that we’re encouraging the public that when we open that we are going to do everything possible to keep you safe,” von Schellwitz said.
von Schellwitz said while they do appreciate the up to $5,000 in working capital available for restaurants, more is simply needed for many.
“What we’ve said is we certainly appreciate what Saskatchewan did with their SSEP program, which provided up to $5,000 of working capital, what we’re saying is we need more of that support in order to get prepared to re-open and in order for our businesses to survive,” von Schellwitz said.
“They just don’t have enough liquidity to pay their vendors, to pay rent, to pay expenses, never mind the re-opening costs, which like other industries it’s quite costly when you have non-perishable inventory and have to stock up on your food again and with restrictions in place their will be costs associated with basic training protocols as well.” von Schellwitz also said.
Restaurants were ordered to close their dinning rooms shortly after the provincial government issued a state of emergency in March.
Restaurants Canada says Saskatchewan’s $2.4-billion food service industry before to COVID-19 represented three per cent of the province’s GDP.
