The total number of liquidations in the hospitality sector amounted to 158 in April, according to data released last week by Statistics South Africa (Stats SA). Hospitality association, FEDHASA cautions, however, that this figure may be higher.
“The figure does not reflect the many more hospitality businesses that have closed down, but which did not formally follow the liquidation process, so the picture is likely much worse than these numbers indicate,” said Rosemary Anderson, Chairperson of FEDHASA.
The statistics further showed that the total number of liquidations had increased by 55.3% in the first four months of 2021 compared with the first four months of 2020.
Some other notable statistics indicated:
- Measured in nominal terms (current prices), the total income for the tourist accommodation industry decreased by 45.3% in March 2021 compared with March 2020.
- Income from accommodation decreased by 35.9% year-on-year in March 2021, the result of a 16.5% decrease in the number of stay unit nights sold and a 23.2% decrease in the average income per stay unit night sold.
- Total income generated by the food and beverage industry decreased by 21.9% in the first quarter of 2021 when compared with the first quarter of 2020. The contributors to this decrease were: restaurants and coffee shops (down 30.2% and contributing -16.2 percentage points) and catering services (down 41.1% and contributing -5.6 percentage points).
Anderson said these statistics indicated how financially damaged the sector was, noting that it did not bode well for the survival of the hospitality and tourism industry if there were further restrictions ahead of a third wave of COVID-19.
“We emphasised in March that trading under strict compliance, together with mass vaccination of South African citizens, was the only solution in the industry’s fight against COVID-19 – and we still believe it to be the way forward,” she said.
“FEDHASA has designed a robust set of health and safety protocols for COVID-19, and our members are acutely aware of the importance of adhering to these standards in order to safeguard the public and to be able to continue trading. Despite the looming third wave, there is no sector as cognisant of the direct relationship between adherence to protocols and the recovery of the sector than the hospitality and tourism industry,” Anderson concluded.
