12,000 restaurants may shut for good, says hospitality body

Restaurant & Catering Association chief executive Wes Lambert.
Restaurant & Catering Association chief executive Wes Lambert. Photo: Renee Nowytarger

 Nearly 12,000 restaurants across Australia may close permanently in the wash-up of the COVID-19 crisis, the industry's peak association has forecast.

Restaurant & Catering Australia chief executive Wes Lambert holds fears for 25 per cent of 47,000-plus restaurants nationwide. Speaking with Good Food, Lambert outlined the impact of the coronavirus shutdown and its anticipated shockwaves.

"The maths says 11,750 [closures]. [It] will depend on how long lockdowns last, how the recovery looks financially from the government, diners coming back to restaurants, and domestic and international travel timelines. All these factors will control the percentage," says Lambert.

The industry fears they longer they are shut down, the more carnage there'll be.

An industry already straining from oversupply of restaurants and cafes has additionally been rocked by a number of factors including wage scandals and rising produce costs.

There is particular concern for fine dining, with questions over diners' budgets and appetite for more conspicuous consumption when the economy reboots.

But it isn't just the high-end under threat. The rapid rise of tap-and-go payments during COVID-19 – which many believe will be permanent and a final nail in the cash economy – will also effect those operating on the fringes.

"I don't think they will survive in an honest environment," warns Icebergs Dining Room and Bar co-owner Maurice Terzini.

Many restaurateurs believe a partial reopening – with strict guidelines on the number of patrons – could be even more damaging, with restaurants taking on set-up costs yet handcuffed by an unprofitable model.

Whether those customers will be there is another question. Lambert argues restaurants often underestimate the effect of tourism on the number of diners they serve.

International tourists won't return any time soon and even the domestic tourism market will take time to regain confidence. Whether restaurateurs have the stomach to wait it out, only time will tell.