“I thought 2019 was bad enough, but the epidemic made the situation worse in 2020 and cut cash income to almost zero,” Li said. “Our savings just can’t support the rent and labour that cost at least 700,000 (US$101,000) yuan a month.”

With Chinese banks not interested in lending to small businesses, Li said “Shutting down the business was the only thing we small-sized cafes and restaurants could do.”

Along a single half kilometre stretch of Zhongshanba Road, one of Guangzhou’s main business thoroughfares “up to 10 restaurants, shops and hotels – big and small – have shut down or are looking to move because they have run out of cash,” said a local property agent, who asked not to be identified.

Given progress in combating the spread of the virus – China reported on Tuesday the fewest number of new cases since it began publishing statistics on January 20 – some areas have started to dismantle restrictions on transport and public assembly.

But the relaxation of containment measures is too late for some businesses.

Some 75 per cent of mainland catering companies suspended operations in the past two months due to the epidemic, according to a survey released by the China hospitality association last week.

More than 70 per cent of survey participants said their overall revenue fell by more than 90 per cent over the period. Moreover, 27 per cent of caterers said they had to close for good because of a shortage of money, while 45 per cent said their cash flow was only sufficient to cover operating costs for two more months at best.

Losses in the catering industry are only part of the damage the coronavirus has inflicted on China, which has recorded more than 80,000 infections and more than 3,100 deaths.

While some losses can be recovered, with restaurants able to reopen once normality returns, the shock to China’s services sector and the wider economy could be huge.

Feng Guohua, the founder of a Hunanese food chain in Shenzhen city, said only seven of his 30 restaurants had so far received permission from the local government to reopen for dine-in services, and the turnover of those seven restaurants was just 10 to 30 per cent of usual. “I am suffering losses of 300,000 yuan (US$43,200) every single day,” Feng said.

“For every restaurant owner I know, their goal for 2020 is to survive and remain in business.”

Another Shenzhen business owner, Steve Gong, who with a close friend invested more than 300,000 yuan to buy a franchise selling baked flat bread in November, said he was so concerned about the situation he was going “sleepless”.

“To shut down, we would lose our entire investment,” Gong said. “To continue, we earn only 200 yuan (US$29) a day but the rent and four workers cost us nearly 40,000 (US$5800) a month. Both our families still have heavy property debts.”

Gong was hopeful business would improve, but said he would jump at the chance to sell the franchise if he could find a buyer. “A third of eateries at the food court our shop is in are going to close,” he said.

“I believe all small private travel agencies of my kind had no income in February,” said Kent Cai, who runs a company in Zhejiang province that operates tailor-made tours for wealthy mainland tourists.

Virus restrictions were preventing would-be travellers from joining groups, Cai said, adding he still had to pay a monthly salary of about 2,300 yuan (US$331) to each of his 18 employees in Hangzhou and Ningbo cities, who had not worked since late last month.

“I estimate my firm will see a revenue loss of at least 4 million yuan (US$576,000) in the first half of this year,” he said. “It’s the biggest crisis the [Chinese] tourism sector has ever had.”

In Guangdong, one third of the province’s 717 star-rated hotels were forced to close temporarily in February, and those that remained open saw an average occupancy rate in the single digits, according to the provincial hotel and lodging association.

Indian hotel chain Oyo announced plans to lay off 60 per cent of its 8,000 workers in China as it struggles with a number of setbacks, including the impact of the coronavirus epidemic, according to Chinese tech blog Technode.

Other parts of the services sector, including China’s more than 12,000 cinemas, were also struggling.

Since late January, all of them have suspended operations, meaning they collected no revenue during the Lunar New Year holiday, when millions of Chinese typically splurge on shopping and going out. Cinemas across the country reaped a total of 5.86 billion yuan (US$844 million) during the week-long Lunar holiday in February 2019, according to Maoyan.com.

“At least 28 new films have been pulled from theatres since January 23,” said Guan Zhi, a Guangzhou-based independent movie producer, “Almost all [film] crews I know have paused shooting.”