Severely hit, hospitality sector yet to recover fully

When the Central government announced demonetization a year ago, among the several businesses that went into a tizzy was the food and beverage industry. Making matters worse for them was the double onslaught of government making service charge obligatory and introducing Goods and Services Tax (GST). A year later, the industry is still trying to recover the losses it incurred last year.

Since November 8, the sales have dipped along with the number of customers and the cash in their hands. Talking to DNA, Kazem Samandari, Director of L’Opera French Bakery, said: “Demonetization affected our business in several ways — the ticket size, the number of customers, and finally the payment methods. Also, the mix of payment methods has changed. Whereas cash payments had declined to less than 25 per cent of all payments in the immediate aftermath of demonetization, they gradually increased to reach 50 per cent.”

He added: “The medium and lower segments of our customers have been mostly affected. Affluent customers continue their purchases. We have, however, experienced a decline in the number of visitors to our shops. The market is definitely not the same.”

For others such as Umang Tewari, owner of The Vault Café, survival has become the …read more