Hospitality business longevity under COVID-19: The impact of COVID-19 on New Zealand’s hospitality industry

Abstract

The aim of this paper is to explore the impact of the COVID-19 pandemic on the New Zealand hospitality industry, within the context of business longevity theory using an on-line qualitative survey of 11 senior industry executives representing 105 restaurant, café and take-away outlets. The findings reveal that despite financial loss, COVID-19 provided an opportunity to engage in strategic innovation through two basic approaches; one mediated by technology, the other by direct personal contact. This internal innovation, flexibility and responsiveness is consistent with the RBV theory of the firm and the inertia and change perspective of organizational Population Ecology theory. The practical implications relate to business longevity and the financial impact across the industry, however, COVID-19 also provided an opportunity for strategic innovation through technology and direct personal customer contact. Innovations were mediated by two government COVID-19 related initiatives - the wage subsidy scheme, and government business loans. The social implications are significant and include a renewed sense of ‘self’ reflecting the need for business survival. Renewal has invigorated participants to differentiate the hospitality industry and its contribution to the national economy from that of tourism. That renewal and vibrancy provides the perfect scenario for the wider sociocultural embrace of a return to normal life and regular business in Aotearoa New Zealand. The limitations of this study include the focus on restaurants, cafes and take-aways - a wider hospitality industry study would provide a more industry representative perspective. The study is also focused on New Zealand as a unique case study; this would not necessarily be representative of the global industry. The qualitative approach and small sample is a strength in terms of depth of analysis, but could be supplemented through a wider quantitative study.