Omicron variant means drop in income for Spanish catering industry

by Lorraine Williamson
Omicron affecting the catering industry

MADRID – The new virus variant Omicron continues to keep the catering industry in its grip in Spain. A 25% loss of revenue due to cancellations this month is expected. This is mainly the reservations of large groups that the catering establishments will now miss out on. 

The sector is expecting an income loss of between €3 – €3.5 billion compared to the same period in 2019. When more than €12 billion were collected around Christmas. Before the arrival of the Omicron variant, the catering industry expected a 10% drop in income. However, that percentage is now much higher. 

So far, it has mainly been large groups that have stayed away, such as company dinners and large family dinners. Moreover, 75% of all cancellations involve a large group of guests. Especially for the catering establishments that specialise in receiving large groups, the new virus variant means a considerable loss. 

Uncertain New Year´s Eve 

It also looks bleak for the nightlife now that the New Year cannot be celebrated as expected. After a euphoric start of ticket sales on November 15, it has already fallen sharply. Nevertheless, in view of the high vaccination rate in Spain, this sector hopes that things will calm down before the 31st and that New Year’s Eve can still be celebrated. 

December important sales month 

The Christmas season is crucial for most catering establishments in Spain: in some cases, up to 30% of the income is generated in December. Especially now that there is no longer any public money available and recovery instead of loss was expected, the new virus variant is hitting hard. 

Of the initial €7 billion that had been set aside by the government to support the catering and tourism sector, a third was never paid out due to problems with the allocation of the money. In principle, the autonomous regions must repay the undistributed amount to the central government before December 31. Now the regions have been given an extra six months to complete the benefit procedures that had already been initiated. All pending proceedings are excluded, and the regions must repay this money. Only the sub-administrations of the two archipelagos have succeeded in actually paying 100% of the allocated amount to ailing companies in the catering and tourism sector. 

Related article: Omicron and how it affects travel

Baycrest Wealth

You may also like