The year 2020 has become a surprise stress fest for many businesses around the globe. But during the time of crisis, business owners focus only on the survival of the company rather than making pioneering innovations or record-breaking profits per quarter. Firms often resort to cost-cutting by reducing operational expenditure and, in many desperate attempts, resort to laying off employees to reduce costs. This would have been the same case for business in the UAE had the government not stepped in as the knight in shining armor.
The COVID-19 pandemic has severely affected many business sectors in the middle eastern region. Industries such as hospitality and tourism and food/beverage industries have taken the hardest hits. The common notion among consumers is derived from the fear of consuming food, which is not homemade during a time of a global pandemic. While it is observed that doing business in Dubai has been stagnant for few restaurant businesses, another observation that pops up on market study is that many small restaurant businesses had to shut their doors due to lack of revenue and consecutive expenditure. In contrast, even larger restaurant chains had to shut down low performing branches to sustain in the market and manage the remaining funds wisely in the time of crisis.
Current Scenario of the Restaurant Industry
The restaurant business sector contributed to almost 5.1% of the overall economy of the UAE in the year 2019. While expectations for business expansion were high for many fast food and casual dining chains, the sudden rise of unpleasant occurrences has led to a market crash which is why the cumulative revenue of the restaurant businesses in the UAE was down by 14.8% in the first quarter of 2020. As a result of the government-imposed lockdown, many restaurant businesses could not entertain guests in-house and had to resort to a business model dependent only on food home delivery and online orders. But even the existential fear and lack of knowledge of the methods of infection led to consumers not opting for home deliveries on a regular basis. These demerits were observed by the Dubai Chamber of Commerce and the Dubai Statistics Centre in an analysis released midway through the second quarter of 2020.
Restaurant Business Group for Industry Recovery
In a recent meeting that occurred on a virtual platform, members of the Dubai Chamber of Commerce and decorated industrialists of the hospitality sector gathered to discuss the goals and objectives of the group that would be formed for improving the state of the restaurant business sector. Mubarak Bin Fahad, Owner - The Tashas Group was appointed as Chairman of the Restaurants Business Group. The objectives that were outlined after the meeting are –
Establish new guidelines for hotels and restaurants to operate in the Emirati market, starting with Dubai.
- Assess the common problems faced by business owners and provide assistance to help them navigate the business and face challenges.
- Bring the various industry players into an established union so they can provide support and receive help in order to revitalize the crumbling sector.
- Create a platform to encourage dialogue and feedback between business owners.
- Bringing the public and private sector together in a coalition for the benefit of the Emirati economy.
- Streamline operations into important priority areas to provide services to customers.
- Create awareness among consumers about the safety standards being followed in food preparation and delivery methods.
- Attract investors into creating funding opportunities for restaurant businesses.
- Create a growing ecosystem that will encourage entrepreneurs to proceed with business setup in Dubai.
Why Choose Commitbiz?
The sudden outbreak of the pandemic had created panic among many business owners. Still, through our tailor-made services, expert consulting, and finesse, we try to provide our clients with assistance to set up business in Dubai and various locations across the UAE. Tough times need stringent measures; hence, we at Commitbiz have come up with a #STARTFROMHOME initiative to help businesses in the UAE. We have fine-tuned our business setup procedure so that you can register your business from the convenience of your home. Your company can be incorporated in just ten days, and what's more, you can also apply for an offshore bank account from your home. The current time is an opportunity to start a home-based business and grow it virtually and connect with consumers. Contact us to know more.