For 83% of bars and restaurants, inflation will be the biggest problem in 2022 – News

Despite the fact that bars and restaurants reopened their doors in 2022 after the end of the restrictive measures against Covid-19, they did not experience the expected expressive and consistent improvement. Rising prices hindered the recovery of the sector. For 83% of establishments inflation According to the ANR (National Association of Restaurants), this is the biggest problem this year.

The survey was conducted in partnership with the consulting company Galunion and Instituto Foodservice Brasil. 817 companies from all over the country, representing about 14 thousand companies in the industry, were heard.

According to ANR chief executive Fernando Blower, inflation has a “double impact, whether it’s on direct costs like rent, CVM (cost of goods sold) or liabilities,” he says.

Rodrigo Alves, one of the priorities of the traditional Ponto Chic, a restaurant with four restaurants in São Paulo, is among a group of entrepreneurs who see price increases as the sector’s biggest villain in 2022.

“We have lived through almost three years of a catastrophic pandemic. Those who didn’t close their doors are now out of money and investment opportunities, still trying to restore the bar or restaurant’s financial health. And then we found a tractor in the opposite direction – inflation,” says Alves.

Brazilian saw prices skyrocket we are the last months. The inflation forecast for April was the highest in 27 years (1.73%).according to BIGS (Brazilian Institute of Geography and Statistics).

The increase was mainly due to fuel, causing prices to cascade due to higher costs as road transport is the main means of transporting goods. According to the inflation forecast for April, the price of petrol (7.51%) and diesel (13.11%) went up.

The latest IPCA-15 (Broad Consumer Price Index – 15) also showed that food and drink prices rose 2.25% in April after rising 2.42% in March. Eating out also rose in price (0.28%), but by a smaller percentage than in the previous month (0.52%).

“This is our raw material, this is what we have felt the most so far, immediately, it ends up at our profit margin when it does not make a loss. It is not easy to convey this price to the consumer, it takes time, and we are afraid that if we immediately risk losing these values ​​to the client. At the stage when we are trying to return it, ”says the owner of Ponto Chic.

Increasing interest

Along with inflation comes an increase in the interest rate, which is necessary to stop consumption and increase prices. Increase by one percentage point Selic CBwhich hit 12.75% makes credit lines more expensive, hurting entrepreneurs who had to take out loans to avoid shutdowns during the Covid-19 crisis.

“This affects companies’ liabilities as recent sector funding during the pandemic, such as Pronampe, will certainly be adjusted with interest pressures as well,” Blower says.

The association’s chief executive also adds that interest rates and inflation should hinder the recovery of bars and restaurants, which improved in late 2021 and early 2022. Six in 10 entrepreneurs in the sector said their February invoicing is the same or less than it was in 2019, the year before the pandemic.

For Rodrigo Alves, the loan rises in price at a very delicate moment. “With the growth of traffic, you need to invest in stocks, invest in a company at a time of high interest,” he emphasizes.

Although the percentage of indebtedness in the sector has improved since the last survey in November, when 55% said they were in debt, this figure remains high (41%). Among them, 15% have to settle for more than three years, and 34% for one to three years.

Resumption of consumption

The relief for bars and restaurants is the resumption of consumer consumption. Last November, only 34% responded that consumers had already returned to pre-pandemic consumption habits. Now that percentage has jumped to 51%.

According to Paulo Camargo, President of the IFB (Instituto Foodservice Brasil), the study shows that the number of consumers resuming consumption is gradually increasing, giving the sector positive expectations for the coming months.

In April, according to Alves, there is historically an increase in April, which is maintained until the end of the year. In relation to March, the owner of Ponto Chic felt a strong increase in traffic.

Bars and restaurants also had to reinvent themselves during this period. Most are betting on the digitalization of business and delivery, as the consumer has not yet fully returned in person. The survey shows that 89% of respondents work with delivery, and 71% consider it a profitable channel.

“An important point is the attention to the restaurant service in digital channels and the constant demand for the quality of delivery work. The pandemic has accelerated this trend and operators now need to be more mindful and structure themselves to serve this channel,” says Camargo.

Other actions have also been implemented, such as launching products with new flavors and textures (57%); focus on promotions, deals of the day, and high-value actions (52%); launch seasonal, fresh or artisanal products (27%) and focus on tasty and healthy products (26%).

* Trainee in R7under the direction of Ana Vinyas

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