McDonald's, Starbucks, KFC shut China stores amidst coronavirus outbreak
Currently, the death toll has reached over a hundred with 4,500 confirmed infections.
Three of the biggest QSR chains have temporarily closed their stores in some cities in China as the deadly novel-coronavirus (n-Cov) has swept the mainland for weeks now.
Yum China, operator of KFC and Pizza Hut, and McDonald’s have reported temporary store closures in Hubei Province, especially in Wuhan, where the new coronavirus is believed to have originated, CNBC has reported.
The report noted that China accounts for 27% of KFC’s system-wide sales. McDonald’s, meanwhile, has over 2,000 stores in the country.
(Also read: Yum China considering Hong Kong listing)
Rival coffee chains Starbucks and Luckin Coffee have also halted operations, including deliveries, in the province since the start of the Chinese New Year.
Whilst Starbucks has reported that they might return their operations on 2 February, other chains have not specified when their suspension of trading ends.
Local government has placed travel bans in major transportation sites around the province to contain the spread of the so-called Wuhan virus.
The death toll currently reached over a hundred with 4,500 confirmed infections since the start of the outbreak on 31 December. Confirmed cases of n-Cov infection were reported in 16 countries worldwide, including Japan, Singapore and the US.
Impact on Singapore, Hong Kong F&B sectors
Singapore food and retail (F&B) chains are amongst potential business sectors seen to suffer amidst the ongoing outbreak, DBS Equity Research said in their latest report.
During the height of the severe acute respiratory syndrome (SARS) virus outbreak in April and May 2003, the F&B sector saw a 22% year-on-year drop.
Should a similar epidemic occur, DBS claimed, foodservice operators like BreadTalk, Jumbo and Koufu could be impacted.
Hong Kong-listed hot pot company Haidilao is also seen to suffer a “significant” drop in traffic footfall as consumers avoid crowded areas, such as restaurants.
The report cited the overall restaurant receipts in Hong Kong during the SARS outbreak to have declined by 19% in Q2 2003.
Earlier, Hong Kong’s Census and Statistics Department reported the island’s worst year-on-year decline in value of restaurant receipts since the 2003 epidemic with a provisional value of 11.7% to $26.4b in Q3 2019.
Recently, Hong Kong has announced the suspension of cross-border travel via ferries and trains to the mainland.
Meanwhile, Singapore has confirmed a total of 7 cases of Wuhan virus infection. The Lion City has no confirmed community spread of the deadly coronavirus, according to the Ministry of Health.
