Small Business in Romania Started During the Pandemic
Amid the COVID-19 crisis, when most of the businesses were shutting down, some HORECA entrepreneurs defied the market trends and took the leap of faith.
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The recent pandemic has been a challenge for all of us. An unprecedented crisis, which turned our lifestyle, our habits upside down and urged us to reconsider our priorities in life. Moreover, it also had an impact on all businesses, from small to large, each one of them having to adapt their strategies to ensure their survival.
According to Global Entrepreneurship Monitor 2020/2021 Global Report [2], in 2020, there was an overall decrease in the number of entrepreneurs who started a new business or oversaw an established one. Yet, the downward trend is not global. A handful of economies have been subjected to a boost of entrepreneurial activity, mainly in Latin America and the Caribbean, along with the Middle East and African economies.
In the midst of this exceptional commotion, Cosmin Tarasescu had the courage to pursue his dream and to open the coffee shop that he always aspired to run. He showed a remarkable fortitude when engaging in this industry considering that he was at his second attempt to inaugurate a coffeehouse and the feedback he received from the entrepreneurs with similar businesses was that the number of clients was on a receding curve.
But what challenges did this small business have to climb?
In this article, we will look at the key needs of Espresst Coffee Shop while the government was supporting primarily the health system and vital sectors.
Adding an outdoor seating area
Adding an outdoor seating area
The open-air ambiance for dining and drinking is not anything new. It is a great opportunity to spend time outdoors, to reiterate the importance of social life, and to take advantage of the nice weather during the summer. However, not every cafe was designed with an outdoor space to add the extra tables needed.
Originally, when the concept of Espresst Coffee Shop was created, it was supposed to include an indoor coffee place with an underground area. The plan did not come to life as it was envisaged. Soon after the government imposed the restrictions against the spreading of the COVID-19, the need for an outdoor sitting area emerged. Conveniently, the location allowed a terrace, and the owner of Espresst fulfilled the necessary requirements in order to be open for business.
The lack of outdoor space also limits the range of products that can be merchandised. For example, Romanian legislation does not allow drinking alcohol in public spaces unless they are specifically designed for this purpose. Customers have acclimatized their behavior which resulted in the dominance of preferring pubs with a terrace instead of takeaway places.
Call to Action: Reorganizing the space within the frame of the new regulations
Nowadays, patio sitting has become a need, not a want. This scenario puts a lot of pressure on the small businesses which face a change of strategy and investment plan. Patio coverage, space heaters, modular and flexible layout are just some of the necessities that would help the pubs to adjust their businesses for imposition. Some of them can achieve this with their own efforts but the authorities should also support them to nourish the sap of cultural identity of the city by paving and smoothing the way for the procedures to authorize terrace openings such as these.
While in Romania entrepreneurs deal with the bureaucratic system to open a terrace, in the City of Cincinnati the mayor decided to take one step forward and transform all the temporary outdoor dining areas into permanent ones [3]. This decision had a huge impact not solely on the social life of the city but also on the traffic flow. Furthermore, it provided a new revenue stream for bars and restaurants.
Respecting the hygiene and social distancing rules
Respecting the hygiene and social distancing rules
In this era of transition, adapting to the new social rules is vital. The number one priority for cafes, pubs, and restaurants owners was the health of their clients. This involves a permanent assessment of the measures they have implemented and an enhancement of the guidelines when the situation requires it.
The owner of the coffee place we are analyzing did not waste time and decided to take the plunge. He quickly adapted to the regulations and ensured that the stringent measures imposed by the government were abided by. This helped him to create a safe environment for clients and himself.
Standardized food and beverage hygiene rules should be obligatory. Individually packed food serving equipment, wearing a mask at all times, and proper hands hygiene became a daily routine at Espresst Coffee Shop. Although the operating costs increased and the maintenance of the workplace required more attention, the owner already started to notice signs of business revival.
Call to Action: Install a new set of sanitation and community interaction practices
Customers are paying more attention to the quality and hygiene of the products. They will be more meticulous in deciding on a product or a service which will lead to ruminating about whether they really need it or not. Ensuring a safe environment where sanitation etiquette is strictly followed will be one of the main drivers to choose a pub or a dining area.
According to a report of the Center for Disease Control and Prevention [4], physical barriers, guides, and masks; cleaning and disinfecting the place; proper ventilation along with an adequate distance between the clients will ensure success to any entrepreneur who follows the mentioned guidelines for his business. Another strategy that should be considered is regulatory awareness.
Each business should be mindful of the recommendations of the state or local authorities to adapt their activity accordingly.
Beyond any doubt, this recent pandemic is here to stay. Further work and collaboration are needed to ensure we overpass this global health emergency. All the owners of small businesses in the HORECA industry call for support from the main actors: customers and government. By maintaining the same level of demand as before the pandemic, the client can help the small businesses to overpass the ongoing economic climate. In addition to this, the government can provide further economic development by guaranteeing bank loans, exemptions from taxes as well as by implementing a set of subsidies for HORECA undertakings.
Written by Albert Cosmin Scirtoaje is a technical analyst in the banking industry. He holds a degree in Cybernetics and Statistics.
Edited by Gökçe Nur Ayaz
September 2021
In 2020 Think Tank AlterContacts launched the Lockdown Economy, an international non-profit grassroots social-economic and educational initiative to help small businesses and self-employed professionals overcome the challenges of the pandemic and reactivate the economy. It is registered by the United Nations as an Acceleration Action for SDG. From May 2020 until July 2021 we have been collecting insights from small business owners and self-employed professionals from different business sectors and countries to see how the COVID-19 pandemic affected their business, their life, and future. This article is based on the field research of the Lockdown Economy.
References
References
[1] - Think Tank AlterContacts, Lockdown Economy initiative, Lockdown Economy in Romania with Espresso Bar. Available at https://youtu.be/yvW2P7pZDIY
[2] - Global Entrepreneurship Monitor, GEM 2020/2021 GLOBAL REPORT. Available at: https://www.gemconsortium.org/report/gem-20202021-global-report
[3] - Movers and Makers City to make outdoor dining permanent with ‘Streateries’ in Downtown, OTR. Available at https://moversmakers.org/2020/12/06/city-to-make-outdoor-dining-permanent-with-streateries-in-downtown-otr/
[4] - Center for Disease Control and Prevention, Considerations for Restaurant and Bar Operators. Available at https://www.cdc.gov/coronavirus/2019-ncov/community/organizations/business-employers/bars-restaurants.html
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