This is the hefty price Burger King is paying for SA’s lock-down

Burger King South Africa has faced significant challenges due to the impact of the COVID-19 pandemic and the subsequent lockdown measures. Amid the level 4 lockdown regulations in South Africa, which allowed food businesses to operate on a home delivery service basis only, Burger King South Africa reopened some of its franchises on the 6th of May. Juan Klopper, the Chief Operating Officer at Burger King South Africa, spoke with CNBC Africa to shed light on the reopening process and the struggles the company is facing. Klopper highlighted the devastating financial impact of the lockdown on Burger King South Africa. The company's entire working capital balance unwound when the lockdown was implemented, leaving them with a significant funding gap of approximately 50 million Rand. Despite being a cash flow positive business, the sudden halt in operations posed a severe challenge. Klopper mentioned that they sought temporary employee relief from the government and received support from their shareholders to navigate the financial difficulties. The chief operating officer also emphasized the importance of home delivery and drive-through services for the survival of the business. With only home delivery permitted during the initial phase of the lockdown, Burger King South Africa was operating at a limited capacity. Klopper expressed concerns about the sustainability of the home delivery model in the long run and advocated for the inclusion of drive-through services to boost revenue and ensure operational efficiency. Burger King South Africa currently employs 2,948 individuals, and the company has had to make difficult decisions to mitigate the impact of the crisis. While they managed to bring back a thousand employees on full-time duty with the implementation of home delivery services, a significant portion of the workforce remains at risk. Klopper acknowledged the challenges faced by the company and expressed a commitment to retaining their employees for future business operations. The uncertainty surrounding the duration of the pandemic and the unpredictability of consumer behavior post-lockdown continues to pose challenges for Burger King South Africa. The company is navigating through a critical period where financial support, operational adaptations, and workforce management are crucial for survival.