COVID-19: Sales in New Zealand's hospitality sector dropped from record high to dramatic low this year - report

Barista. Photo credit: Getty

Sales in the hospitality sector have plummeted significantly this year due to the ongoing impacts of the COVID-19 pandemic - yet takeaway businesses have recorded a welcome boost, a new report has revealed. 

The latest data demonstrates just how hard New Zealand's hospitality sector has been hit by COVID-19, with nationwide sales nosediving dramatically this year due to the closed border and stringent lockdown restrictions. Numerous businesses have been forced to let off staff, and many have permanently closed their doors.

It follows an all-time high for the sector the previous year, with sales reaching a record $12.1 billion for the year ending in March, the 2020 Hospitality report found. Between April and June, that figure plunged to $1.7 billion - a decline of more than 40 percent.

Restaurant Association chief executive Marisa Bidois says COVID-19 has permanently reshaped the hospitality industry.

"COVID has permanently changed the hospitality sector, forever," she told Newshub on Sunday.

"There are still parts of the country that are significantly affected by our closed borders."

Although the industry was still in decline from July to September - recording a 3.1 percent drop in sales over the same quarter in 2019 - trading conditions improved overall. Takeaway businesses managed to claw back their sales, recording a welcome 8.4 percent growth over this period. 

It's the only sector of the industry to record a positive change, the report found.

Catering businesses have also seen a boost in sales, with an increased demand for in-house catering services facilitating their recovery, Bidois said.

"There have been silver linings. We're starting to see [a] really strong recovery in many regions.

"Northland has seen a big percentage increase in sales, which is encouraging. There's definitely pockets of good news around the country."

Many regions saw positive sales growth in the third quarter, the report found, with Tasman up 29.3 percent over 2019. Kaikōura, Marlborough, and Nelson were also up by 19.4 percent, 18.2 percent, and 17.8 percent respectively. 

Yet it will still take some time to recover from the declines in the second quarter, with Auckland and Queenstown continuing to be the two most affected regions.

Bidois said she spoke to a Restaurant Association member in Queenstown recently - their business is still down by 85 percent.

"There are many out there still struggling."

Read the full report here.