Hospitality industry will continue to suffer throughout 2021
The Dutch hospitality industry will suffer from the aftermath of the coronavirus crisis for years to come. This year, the sector will see its turnover drop by 40 percent compared to last year. The situation for next year is projected to be slightly brighter, with an average loss of sales around 20 percent. This was predicted by ING’s Economics Department.
Due to the long-term loss of income and uncertainty about the future, the number of business closures and bankruptcies will rise sharply next year. The question is also when pre-crisis levels can be achieved again.
According to ING, the recovery will gain momentum as soon as vaccination starts, and lockdown measures can be gradually reversed. The exact turning point will be difficult to predict.
Holiday parks and restaurants are likely to recover faster than cafes and hotels, which have suffered the most from lockdown measures. Hotels are largely dependent on foreign tourists who will only come back once travel restrictions have been lifted.
Nightlife, too, has suffered significantly, as it is difficult to comply with the 1.5-meter social distancing rule. It is expected that this rule will continue to apply for some time to come. In addition, hotels and cafes lost more turnover in 2020 than, for example, holiday parks.
The long-term loss of income and the lack of clarity about when hospitality businesses can reopen (and under what conditions) will lead to an increase in the number of bankruptcies. According to ING, the five to six hundred companies that are expected to go bust are just the tip of the iceberg. This is because many entrepreneurs will probably pull the plug themselves before they go bankrupt.