Hospitality and Service Industries: Adjusting for a Slow Recovery
Above: Carl Sobocinski
By L.C. Leach III
While coronavirus is only a few months old, its effects are already being felt by the hospitality and service industries into 2021.
And as restaurants, hotels, and all systems supporting tourism and entertainment begin to reopen across South Carolina and the U.S., the outlook for them is the same: It’s going to be a slow recovery.
During the Greenville County Chamber of Commerce’s webinar May 19, area restaurateur Carl Sobocinski and hotelier Fabian Unterzaucher spoke about how Covid-19 has changed their industries and how it will affect their futures.
“The hospitality industry has been hit harder than any other,” said Unterzaucher, general manager and partner at Westin Poinsett Hotel in downtown Greenville. “It’s the first time all the area hotels have been closed for an extended period of time. Our occupancy is around 8 percent, and that’s hard to make a living.”
He added that the hotel’s Gold Ballroom, a major venue for weddings, meetings, conferences, conventions and parties, has been “quiet and closed for two months.”
“And that’s really devastating,” he said. “So when people ask me if I’m fearful of a second wave, I say that as long as our infection rate increases, we haven’t fully mastered the first wave.”
Based on reports from the South Carolina Department of Parks, Recreation and Tourism, more than 45 percent of all hotel properties were closed as of mid-April.
“And since March 1, we’ve had a $2.1 billion loss in revenue to state tourism,” said Dawn Dawson-House, department director of corporate communication. “That’s out of an estimated $23 billion-a-year industry.”
And even though restaurants everywhere have made huge adjustments with curbside pick-up, extra sanitizing of surfaces, and social distancing among customers, operators like Sobocinski are feeling the crunch on revenue.
“We’re trying to rewrite budgets and find break-even points,” said Sobocinski, founder and president of Table 301 Restaurant Group. “But right now, the math doesn’t work – we can’t break even – and I don’t know that we’re even going to hit 50 percent of 2019 sales between now and the end of 2020.”
He also pointed out the underlying importance of places like the Poinsett to downtown restaurants.
“From Monday through Thursday, 60-75 percent of our guests come from the hotels and business travelers that are in town.”
But both Sobocinski and Unterzaucher said they are facing the present with an eye to recovering, however long that recovery may take.
“Adaptability is the key,” Sobocinski said. “We’re now using single-use menus, we have all of our servers in front of the house wearing face masks and coverings, and have eliminated touch points that could be viewed as potentially contagious.”
And when asked how the Poinsett and the hotel industry will be different after the pandemic passes, Unterzaucher said the first step to a brighter future has already happened.
“That we are opening shows we are already heading a little bit more in the right direction,” he said. “And until a vaccine is developed, we will simply have to adjust.”