The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The operator of Luciano's yesterday warned that COVID-19 will claim "more casualties" in the Bahamian dine-in restaurant industry after the pandemic put "the final nail in the coffin" for the business and its 72 employees.

Ash Henderson, marketing director for George Myers' Restaurant Services Ltd, told Tribune Business via e-mailed replies to this newspaper's questions that maintaining profitability will be "extremely challenging" for the industry due to the social distancing protocols it will have to adopt.

This will likely reduce the number of seats, tables and customers allowed in a restaurant at any one time, immediately reducing business volumes and revenues for an industry that traditionally operates on thin margins.

Speaking after the East Bay Street location's permanent closure was confirmed, Mr Henderson said: "With the slim margins that the industry operates under, restaurants only survive by filling as many of their seats and tables as possible. If the reality of post-COVID-19 life is increased social distancing then it's going to become extremely challenging to maintain profitability. I sadly expect to see more casualties in the industry."

His comments provide an ominous warning of what may be to come for the sector whenever it emerges from the COVID-19 restrictions and closures it is currently labouring under. Luciano's, which opened in 2004 and could accommodate a maximum 200 guests, becomes the most prominent corporate name yet to confirm it will not re-open after the pandemic.

Mr Henderson confirmed that 72 managers and staff will lose their jobs, and said the company was still working through the process of paying them their due severance and benefits. He added that Luciano's had been suffering "mounting losses" for the past "couple of years", and the COVID-19 aftermath and shutdown prompted the restaurant's closure for good.

Declining to comment on the extent of these losses, Mr Henderson added: "The restaurant industry is known to be extremely difficult. It's challenging to manage food costs, labour costs and service quality, particularly with the notoriously slim margins that restaurants operate under.

"It's a tough industry at the best of times, and these are certainly not the best of times. Considering the weekend lockdowns, and the fact people cannot dine in, operating a dine-in restaurant became a little more challenging."

Restaurant Services, in a statement, said: "After more than a decade serving the Bahamian community and visitors, the restaurant will be permanently closing its doors. Due to the current economic climate, the restaurant's reliance on the tourist market and the economic uncertainty in the coming months, it is unable to continue as a viable business.

"Despite increased competition in the industry, and a shift in the customer base, Luciano's management had remained committed to its staff despite mounting losses each month. The economic impact of COVID-19 was the final nail in the coffin, leaving no choice but to close and make its team redundant.

"The sad reality is that the restaurant industry operates on very slim margins, and Luciano's was no exception. The owners and management team have been struggling to make ends meet for the last couple of years, and have exhausted every avenue to keep the restaurant open and to keep the team employed. Nobody could have predicted the effects from COVID- 19 on the economy and, sadly, the fall-out has necessitated the permanent closure of the restaurant."

Mr Henderson explained that the "shift in the customer base" referred to the loss of corporate customers as many businesses relocated to western New Providence. "Corporate clients were a significant portion of our customer base, for both corporate events as well as business lunches and dinners," he said.

"As many of those corporate clients have moved their operations west we certainly saw an impact on our revenues. This, coupled with increased competition in the industry at large, created an unsustainable situation which COVID-19 exacerbated, potentially indefinitely."

Luciano's operated from property owned by the family of former Cabinet minister Brent Symonette, and was based in his childhood home.