According to the Association of Retail and Restaurant Brands (AMRR), half of the trade and catering companies in Portugal report sales drops of over 50% since the beginning of the pandemic.
Half of the trade and catering companies in Portugal report sales drops of over 50% since the pandemic began, 72% have gone into debt to cover losses, and 60% are considering a creditor protection plan in 2021, a survey revealed on Monday.
Carried out by the Association of Retail and Restaurant Brands (AMRR) between November 1 and 4 to “assess the sector’s sustainability,” the survey – to which members representing more than 2,300 shops responded – shows that 50% of the companies show sales declines of more than 50% and 95% report declines of more than 25% between March 15 and October 31.
The study also shows that “72% of the companies have had to increase their bank debt in order to face losses and rescue treasury difficulties, and 66% have resorted to own or shareholder funds.
On the other hand, 60% of companies “consider it likely that they will have recourse to a creditor protection plan in 2021.
With regard to the measures advocated to enable enterprises to become viable, 75% of respondents said that the variable rent scheme approved in the Supplementary Budget Law” is essential for their salvation and employment protection”, provided it is implemented from lockdown and extended to 2021.
Regarding the new restrictions decreed under the state of emergency, which begins today, the president of AMRR noted that the government “acknowledges that the measures are very bad for restaurants and commerce, especially in a period close to Christmas, which is the salvation of the year for many”.
“2020 is catastrophic. If measures are not approved to distribute the sacrifice fairly among owners, tenants and the state, tens of thousands of companies will go bankrupt and hundreds of thousands of jobs will be lost,” warned Miguel Pina Martins.
Stressing that “it is in the hands of the government and parliament to ensure the application of variable rents in 2021 and a reduction in the rents of shopkeepers and street restaurants”, the association leader warns that “only in this way is it possible, as a community and a sector, to overcome this crisis by sharing sacrifices”.
Pina Martins also defended, “as an immediate measure”, a flexibilisation of commercial spaces, pointing out that “the shopkeepers have made huge investments to have safe spaces and do not feel that this effort is being recognised by the government”.
“AMRR calls on policymakers to take the necessary measures so that retail and catering companies can survive this crisis, allowing the protection of the more than 375,000 jobs that the sector generates and the country’s economic recovery,” he said.
The government announced on Sunday morning a curfew between 11 pm and 5 am on weekdays, from Monday to November 23, in the 121 municipalities most affected by the pandemic.
“We have the clear notion that social coexistence has a very important contribution to the spread” of the contagion and that the spread develops in the post-work period, António Costa said at the end of the extraordinary cabinet meeting to implement the measures of the state of emergency that will be in force between Monday, November 9 and the 23rd.