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Jakarta Post

Food & Beverage industry hit hardest by COVID-19: Report

  • News Desk

    The Jakarta Post

Jakarta   /   Fri, March 27, 2020   /   01:34 pm
Food & Beverage industry hit hardest by COVID-19: Report Heri Setiawan, owner and barista at Kopi Selo coffee shop. (JP/Ganug Nugroho Adi)

The food and beverage (F&B) industry across cities in Indonesia has been hit hard by the COVID-19 pandemic as people opt to stay in rather than going out for meals, data from a payment gateway show. 

According to data from PT Moka Teknologi Indonesia, a homegrown startup that provides digital cashier services to more than 30,000 merchants in Indonesia, a number of industries had experienced losses due to the pandemic, including the service and retail industry. But the data revealed that the F&B industry had seen the largest impact. 

“For the F&B industry, of the 17 cities that were observed, 13 cities experienced a significant decrease in their daily earnings,” the report released on Thursday stated.

Meanwhile, the service industry saw a noticeable impact in 10 out of the 17 cities, and the retail industry was hit in seven cities, according to the report.

Among more than a dozen cities affected, Surabaya in East Java and Bali were the two cities with the biggest fall in daily earnings.

The F&B industry in Surabaya plunged 26 percent, meanwhile, Bali experienced a decline of 18 percent, with areas in Greater Jakarta following suit, including Depok, Tangerang, West Jakarta and East Jakarta.

“Business players must be able to survive for the next three to six months. There needs to be a temporary change in business processes for the cash flow to remain positive,” Leonard Theosabrata, president director of SMESCO, a government institution responsible for training and facilitating small and medium enterprises, said as quoted in the report.

Read also: [UPDATED] List of Jakarta malls, restaurants affected by COVID-19 outbreak

Leonard offered several strategies applicable for businesses during difficult times like these. He suggested that business players could use the opportunity to make some reviews, get to know their customers and their needs, simplify their business processes, identify the products that are easy to sell, digitalize products into an easy-to-share catalog, add goods stocks, and give incentives to well-performing employees.

In an effort to maintain a positive cash flow, businesses can focus on promotion for takeout deliveries, use a database of customers to communicate promotions through email, text messages and promote the use of digital payment, the report suggests.

A focus on takeout deliveries has become one of the key strategies because data show that there has been a change in consumer behavior with more people opting for takeout food.

Between January until February 2020, takeout food purchases increased 7 percent. 

In terms of the depth of impact COVID-19 has had across industries, the retail industry saw the steepest fall. The five cities that were most affected in their retail sector were West Jakarta, South Tangerang, Depok, Central Jakarta and Bandung, with the biggest daily earnings decline recorded in West Jakarta, a 32 percent fall in daily earnings per outlet.  

In the service industry, the five most impacted cities were Depok, Bekasi, East Jakarta, Batam and Bandung.

However, several outlier products have seen a swell in purchases, including masks and hand sanitizer, as people rushed to get their hands on the products in a bid to safeguard themselves against the coronavirus. In February alone, sales of hand sanitizer went up 209 percent, Moka data show. (ydp)