Greetings!
The new year has certainly been 'eventful' to say the least. We've witnesses horrific unimaginable disaster all over our country and now our cousins in NZ are dealing with their own nightmare, which has rocked the region.
 |
| Brisbane Business Flood Damage (pic supplied by 'Brisbane Day') |
Small Business is certainly feeling the effects in a big way. I was reading some news regarding Queensland's small business owners and how they are getting back on their feet, be it slow. Not only did small business owners have to deal with the mortifying floods not seen for 37 years - but before that occurred and ongoing, they've had the odds stacked against them with high interest rates and a very competitive Australian currency. Many suburban small businesses have been forced to close. Here's what the Brisbane Times writes follow 6 weeks after the floods:
************************
"Six weeks on and it's not just the businesses that went under water who are feeling the pinch.
Enterprises unaffected or now reopened are struggling as they battle perceptions externally that the city is not yet recovered, while internally Brisbane residents cut their discretionary spending.
With 2500 Brisbane businesses losing an average of $800,000 each from the flooding, according to Queensland Chamber of Commerce and Industry estimates, business leaders are calling for residents to open their wallets to help give the city's economy the kick along it needs.
Retail
Chamber of Commerce and Industry Queensland general manager policy Nick Behrens said numerous small businesses in Brisbane suburbs had not reopened weeks after they were damaged and some had no intention to.
"Any business that relies on discretionary expenditure such as retail [and] the service industry - accommodation, cafes, restaurants, hoteliers, bed and breakfasts - they're the ones that are unfortunately doing it the toughest at this point in time," he said.
United Retailers Federation president Scott Driscoll said poor sales had lead to an "extremely high" number of job losses in the retail sector, as well as a reduction in employees' hours.
"All
small businesses across Queensland are looking at ways that they can counter costs," he said.
"Unfortunately, one of the ways that they're going to be forced to go ... is to reduce staff hours or reduce staff numbers."
Spending at the higher end of the market appears to be faring worse.
Ted's Camera CBD store assistant manager Lisa Roxborough said sales had been sluggish for months.
"There's not a lot of trade," she said.
"A lot of people are still shopping around but they're more after bargains to save their pennies."
Joanne Mercer Footwear Queen St Mall store assistant manager Monita Anthony said sales were almost non-existent on weekends during the flood clean-up but had started to pick up again.
Tourism
Paul Lewin, CEO of the popular Story Bridge Adventure Climb at Kangaroo Point, said his business was half its traditional January levels.
"I think there is a perception that Brisbane is still closed," Mr Lewin said.
"There are a number of people who phone us up and say 'Are you open yet?'.
Mr Lewin said only about 20 per cent of Story Bridge Adventure Climb customers were international travellers, and that many locals were wary with their spending for either financial or emotional reasons.
"I think to a degree people don't want to be seen as having too much fun in an area that has just been decimated by the floods," he said.
South Bank Parklands CEO Malcolm Snow is facing a similar battle, with up to 70 per cent of the park's visitors from southeast Queensland.
He said it was crucial to pitch any future marketing campaigns at getting local people out enjoying their city again.
Advertising
Marketing budgets are often seen as a way of measuring business confidence.
Mitchell Communications Group managing director Kenny Stewart said the floods had caused some industries to increase advertising, while others were down.
"Retail clients are obviously spending because the [flood victims] are going to be needing furniture and other goods," he said.
"In insurance ... we're seeing advertising up because of the opportunity there.
"Tourism certainly is a massive concern in the market at the moment. Extra money has been made available [for advertising] to [get across] that we are actually open for
business.
"The government ... is putting its money where its mouth is to promote the general industry. But individual tourism operators are finding it pretty hard [and are not advertising]."
Mr Stewart said property advertising was the same.
He expected legal services to begin to ramp up their advertising as flood victims sought to chase insurers.
Kevin Moreland, a partner of agency BCM,
said his agency had suffered only a logistical pain during the floods.
"The floods have been certainly a hiccup but I don't necessarily know ... [that] they have had a significant impact on the state of the business," he said.
"It's pretty much business as usual."
Hair, beauty, fashion
A forced three-day closure followed by weeks of slow trade has already cost upmarket Fortitude Valley salon Fabrik two staff and around $30,000 in lost business, according to proprietor Darcy Stratford.
While business was slowing picking up, Mr Stratford said he didn't expect to turn a profit this year.
“People are spending less when they come in – there was a period when I think people felt guilty about spending anything on themselves at all after the floods,” he said. “It went from being a slow Christmas period to staff holidays to floods to cyclones.
“It's a wonder our doors are open at all.”
Several fashion boutiques in some of Brisbane's highest-profile strips have not reopened since forced closures in January, including shops on James Street and Brisbane CBD.
Eloise Monaghan of high-end sensuality boutique Honey Birdette said while her business emerged relatively unscathed, other retailers were struggling in the wake of floods, rate rises and the absence of stimulus spending.
“We lost trade during the floods when we were forced to close all three of our Brisbane stores,” Ms Monaghan said. “But we've come back strong and feel we're well positioned for the rest of the financial year.
“However we've noticed customers in our Sydney boutique still think that Brisbane is underwater so there's an issue of perception still facing small business owners.”
Hospitality
A 15L bottle of Moet was among the $150,000 wine collection lost when Moo Moo restaurant was flooded in January.
While the power remains out, owners Steven and Autumn Adams are ploughing ahead with plans to reopen on March 23.
Others, such as CBD restaurant Barolo, the sunken Drift Café at Milton and restaurants attached to the Stamford Plaza, will remain closed for some time.
But it is good news for some businesses on the swamped Riverside complex and Eagle Street pier, with the Pig and Whistle, Alchemy and Customs House among the venues now back open for business.
However, Groove Train, Jellyfish and Boardwalk Bar and Bistro remain closed.
The flood has led to some innovative thinking, with Jellyfish temporarily sharing space with upmarket steak restaurant Cha Cha Char, at Eagle Street Pier, with a limited menu on offer.
Where to now?
Despite the tough year thus far, Nick Behrens said the future looked brighter for Brisbane.
"The fundamentals of the Queensland economy are still quite sound," Mr Behrens said.
"We have an average 2.3 per cent annual population growth - that's something that's well and truly in our favour. We also have significant infrastructure projects that are going ahead ... [and Queensland] has to rebuild following the floods and cyclone.
"Whilst the Queensland economy is going to take a hit in 2010/11 financial year, the expectation is that for 2011/12 financial year it will well and truly start to pick up.
"
********************
It is interesting to see how people are working out ways to overcome their business problems after such events, some have closed altogether and cut their losses, some have opened and receiving trickling business but I thought it very interesting and inspiring how others are banning together and sharing the expenses by combining their businesses...brilliant and creative! Obviously there are lots of items, both legal and operational to work through but it's a great way to face such an incredibly devastating event in a positive manner.
Small business marketing is also a crucial key to ensuring you get the word out to customers that you're open for business. I will discuss this further in my next blog.
In the meantime, if you live in or close to a devastated area and you managed to get through it without the losses others did, please, please support small business and make an appointment to help our small businesses get out of the mud and survive once again.
I probably go into his store a few times a week to pick up a carton of milk or some bagels for the kids for the weekends.
