Singapore businesses in China tough it out

Mr William Ding outside Vanda Room in the largely residential area of Shuangjing in Beijing. He went to Beijing in 2012 to begin his dream of running his own restaurant. PHOTO: WILLIAM DING

In the eight years that Mr William Ding has been running his Singaporean eatery in Beijing, there has been no other more challenging time than now.

Like other food and beverage businesses across the country, Mr Ding's popular restaurant, Vanda Room, has been forced to shut since the coronavirus outbreak took hold of the country.

He now does only deliveries while waiting for approval from his landlord to resume his dine-in service.

"If this drags on, both large and small F&B players will find it hard to be sustainable," said the 48-year-old Singaporean, whose revenue now is about 15 per cent of his usual. "People aren't going out or eating out. They mostly cook at home now."

Plans to open another shop in the central business district have also been delayed as renovations cannot start.

Restaurants that have been allowed to reopen must abide by strict regulations, including serving groups of no more than three, and positioning tables at least 1.5m apart.

Mr Ong Tze Guan, 54, vice-chair of the Singapore Chamber of Commerce in China, said those in the hospitality sector have seen their business dip by 70 per cent to as much as 90 per cent.

"A lot of landlords have not responded to whether they will reduce rents but businesses still have to pay salaries and taxes. It is putting quite a bit of financial pressure, especially on small and medium enterprises," he said.

"Large corporations have deeper pockets to sustain them for these one to two months, but they, too, will be hit."

Mr Ong's own environmental engineering business, which provides waste water treatment solutions and equipment, has also slowed.

He has had to put on hold a search for a factory site, which could set him back between three months and half a year, he said.

Hotel group Millennium Hotels and Resorts, which has over 3,500 staff in 12 properties across Greater China, said the outbreak has affected the hospitality industry severely since late January and it has seen a steep drop in tourist numbers, which has affected occupancy rates across China and other countries.

"This situation could get worse before getting better depending on the development of Covid-19," it said.

It has waived cancellation fees for affected guests and will be reviewing individual hotel business plans for the coming quarter, "and adjusting these plans, where necessary", it told The Straits Times.

Another big player, CapitaLand, has had to shut 12 of its 46 operational malls in China under government directives, although the supermarkets and food and beverage outlets in some of them remain open. Its lodging unit, The Ascott, is also waiving cancellation fees for guests who have to change their travel plans.

Mr Shan Lee, 38, residence manager at Ascott Songshan Lake and Citadines Songshan Lake in Dongguan in Guangdong province, said the properties have implemented measures such as using service robots more regularly to provide concierge services, leading guests to their rooms and delivering packages.

In Qingdao, Mr Russell Tan, 53, has had to deal with workers who are unable to return to the city because of quarantine measures.

Mr Tan employs 600 workers and provides catering and cleaning services to plants like Bombardier and Durex and malls in the city in Shandong province.

"Like most businesses, we're caught in a cash-flow problem. Everyone's busy fighting this coronavirus, no one is settling bills," said the businessman, who has run his own company, YS Services, since 2003.

He said the experience this time was different from the outbreak of severe acute respiratory syndrome (Sars) in 2003. "It's just a lot of paperwork, a lot of controls. Everyone is a lot more careful ," he said.

Mr Tan expects his revenue will dip to 50 million yuan (S$910 million) from 70 million yuan this year, but he sees a silver lining to this crisis.

"It will push out the smaller companies that compete just on price."

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