‘€7.1bn income drop in food service sector’, experts say

Photo: DutchNews.nl
Photo: DutchNews.nl

Economic experts have predicted that the ‘intelligent lockdown’ and months of a 1.5 metre-distance society will have profound impacts, especially on the retail and hospitality industries.

The FoodService Instituut (FSIN) on Friday predicted that the food service sector would lose a ‘disastrous’ €7.1bn in income in 2020.

Restaurants, cafés and hotels would lose 41.5% of their expected takings, it said. It predicted that consumers would spend €5.5bn less on food – with the Dutch steering clear of luxury products and choosing cheaper shops, and millions of high-spending tourists staying at home.

However, despite predicting that the entire food industry would be ‘turned upside down’, the FSIN is predicting that supermarkets alone will do well, with an increase in revenues of €1.8bn this year.

‘In the Netherlands’ food and hospitality industry there was an over-supply of outlets, some of which already had poor takings,’ it said. ‘A shake out was unavoidable. But in our new scenario, the crisis will also affect innovative, start-up businesses which would be viable in non-corona times, and businesses without sufficient liquidity to take the loss of income.’

ABN Amro is predicting a 13% year-on-year drop in consumption during the intelligent lockdown, but also believes that supermarkets and local speciality stores will benefit, alongside those with a strong online operation.

The bank’s economists predict that a severe drop in consumer spending will drive a recession and 4% fall in GDP this year  – demonstrated at the Easter weekend, when spending was down by 22%.

Meanwhile, the Rabobank has calculated the effects of a long-standing ‘1.5 metre economy’, outlined by prime minister Mark Rutte on Wednesday. It believes that while 89% of Dutch economic activity can be achieved largely from home, 11% of jobs cannot, including hospitality, healthcare and personal services such as hairdressing.

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