Restaurants begin in 2017 prejudice

São Paulo-despite the prospect of a slight improvement in the power sector outside the home, the scene at this beginning of year is still worrisome, since 33% of bars and restaurants came into 2017 operating at a loss. To make the picture, one in six companies estimates that will not stay on the market.
The survey, conducted by the Brazilian Association of bars and Restaurants (Abrasel), signals, in the view of the President, Paul Solmucci, for a trend of gradual improvement. "The percentage of loss-making companies is still very high, but the result points to a reversal movement".
The Executive mind that since the fourth quarter of 2014 (when the index was at 5%) the slice of business companies operating in the Red grew exponentially, reaching your peak in the third quarter of last year. At the time, 39% of establishments operated in prejudice. In the latest survey, for the fourth quarter of 2016, the movement began to change, injecting a tempered optimism in the sector.
The expectation for this year, for example, is the recovery of profitability of businesses continue. "By the end of 2017, if there is no drastic change, we hope that the slice of companies operating at a loss falls to 20% to 25%," he says.
The network of pizzerias Patroni, with about of 170 restaurants in operation, is an example of the difficulty imposed by the crisis in balancing costs with revenue. According to the company''s founder, Rubens Augusto, profitability fell by about 50 percent last year, compared to 2015. "We didn''t have to work in the red, but we work with zero profit," he says.
The Manager explains that in 2016, there was a very large increase of fixed costs (cost of occupation, wages, water and light) and a considerable drop in the flow of customers, the network fell in 4%. The two factors, coupled with the inability to raise prices of the dishes, generated a sharp decline in profitability. This year, however, the businessman already expects an improvement in the framework. "We believe that part of profitability we managed to recover, but the total still don''t," he predicts.
In terms of revenues, the network closed Augusto last year with a real 1.4 percent drop, after having grown, between the years of 2003 to 2014, an annual average of 24.5%. "It was the worst year for us," laments.
The manager points out, however, that the first two months of 2017 have shown a reaction, with a high average of 5% in sales. The prospect for the consolidated is a growth around 12%. "Already we see a resumption that early in the second half and the trend is to improve even more," he says.
With more conservative vision, the network''s General Director of Diners Johnny Rockets, Antônio Augusto de Souza, claims that, despite the more positive outlook for the year, the market reaction hasn''t come in the early months of 2017. He says that last year the network, which has 12 units, closed with a retraction of 20% in turnover, the concept '' same '' stores. For this year, the forecast is high, but not enough to recover the losses of last year.
Regarding profitability, the Executive also claims that there has been a sharp decline and, as well as on the reduction became Patroni close to 50%. "Now, our goal is to survive and be well positioned for when the economy resume."
Locks
The concern of the entrepreneur in a moment that about 16 percent of bars and restaurants still fear did not survive the crisis this year, according to the Abrasel. According to the President of the entity, Solmucci, the branch has gone through cycles during the recession, and now is in a stage where the number of companies is actually decreasing. "First, we went through a period where companies broke, but were replaced by new entrants. From the second half of last year, however, the number of companies in fact are reducing, "he said.
According to him, the locks must continue occurring for at least the first half of this year. The President of the Brazilian Institute of Retail executives and Consumer Market (Ibevar), Claudio Felisoni, agrees and estimates that "this year we continue watching a high number of closures of companies, albeit at a lower rate than seen last year."
Despite showing concern about the prospect of more closures of stores during the year, Solmucci, Abrasel, ponders that the decrease of the offer ends up favoring companies that remain on the market. "Those who survive must take advantage of the scenery," she concludes.
Major networks
In this context, large networks, represented by Brazil Foodservice Institute (IFB), appear to be relatively higher than the average performance of the market. In terms of revenue, for example, the IFB related networks 38 saw a real drop of about 1 percent-front of a retraction of 3.75% of the sector as a whole, according the Abrasel.
"The scenario is bad for everyone, but the independents end up suffering more, since we don''t have the structure and the planning that we have," says the President of the Office, Alexander war. According to the Executive, who is also President of the fast-food network Giraffas, large followed by investing in expansion and improvement of operation even during the recession, which favored the result.
For this year, the prospect of the entity is a nominal growth of 10.9% in turnover. "In the last two years have seen a sharp drop in demand and a huge inflationary pressure. Now, we see a reversal: inflation is falling and consumer confidence improving, "he says. The Abrasel, for your time, provides a real high of 1.5% for the branch.