Coronavirus 'new reality' bites deep into Beijing eatery chain

Martin Quin Pollard, Reuters

Posted at Apr 14 2020 05:49 PM

Customers are seen at a Moka Bros restaurant in Beijing, as the spread of the novel coronavirus disease (COVID-19) continues in the country, China, April 10, 2020. Martin Pollard, Reuters

BEIJING - The worst of the COVID-19 outbreak in China may be over, but one Beijing-based restaurant chain is struggling with a "new reality" - fewer customers, reduced seating capacity, shorter hours, pay cuts and problems of cashflow and landlords.

Spring is usually a strong season for the Moka Bros chain, but daily sales are down around 60 percent on last year, says Alex Molina, who with 2 partners started the 14-outlet Mosto Group from a single restaurant 12 years ago.

Several stores may close for good, and by year-end, losses could hit around $1 million, Molina told Reuters in an interview during a recent sunny lunchtime at the chain's flagship store in the trendy Sanlitun neighborhood.

"It's been a little bit traumatic and the days pass and the situation is coming back to a certain level of a new normality," said Molina, a Colombian who is also creative director of the Mosto Group which includes Moka and 3 other brands.

"But it's been the longest 3 months of my life," he said as a steady trickle of customers mostly kept their masks on until their food or beverages arrived.

The restaurant normally seats 60 to 70 but social distancing regulations now limits it to 30. If more customers come, they are told to wait, but this means some just leave, staff said.

With few tourists - all arrivals to Beijing must undergo a 14-day quarantine and foreigners are barred from entering China - "We are living off our regulars," Molina said.

Staff once numbered about 200, but several dozen have been let go. Opening hours have been cut to one shift per day, salaries deferred and management have taken a 50 percent pay cut.

Some landlords are offering discounts, but with others negotiations are ongoing, he said. Options on the table include profit and revenue-sharing as an alternative to rent.

Nevertheless, Moka Bros has tried to be creative, especially with its online marketing and delivery, such as adding temporary discounts and "personal, handwritten" notes to customers.

"It's going to be a new reality that we are going to need to reinvent ourselves and find a way. But it's going to take longer. But for sure we're going to find a way. People love to go to restaurants," said Molina.