Refusing to participate in the recession
These days we often hear conversations that begin, "What do you make of this economic mess? Where do you think the bottom is? When will we see a turnaround?"
We recently posed similar questions to an old friend. His response? "There are a great many new opportunities."
Of course the man is right, and we were delighted to finally hear someone voice this truth. Certainly the economic slump is affecting all businesses and the hospitality business, while said to be "recession resistant," is not immune.
We saw last month the gambling tax collections, and income for operators, declined a startling 5 percent Oct.-Dec. 2008. It is likely down in Jan.-March, 2009, too. Undeniably a contraction of gaming revenues implies a measure of revenue shrinkage in other business departments such as beverage, food and amusement.
As if that weren't enough, licensees are also facing the uncertainties associated with the end of the four-year smoking ban exemption for licensed businesses that will take place in just five months.
Some operators are understandably worried; others are in outright financial distress. But as the Montana Tavern Times found during a recent day-long excursion to several top-flight Billings establishments, businesses don't have to—indeed, ought not to—idly succumb to the difficult challenges ahead.
This month we launch a series of articles and profiles on these businesses and what they are doing to exploit current conditions and to grow their businesses despite a worldwide recession.
Several keys to the successful strategies these businesses are implementing emerged. None of them are really new, but most may have been forgotten during the relatively easy "good times" we've experienced over the last two decades.
One thing these operators seem to agree on is that it is a mistake to rely solely on your gaming departments to float the business. Some may have been able to do this, but those days may be passed.
They also agree there is no substitute for hard work, and these operators seem determined to outwork their competitors with 14-hour days and seven-day work weeks. In addition, they all say the owner who is on premise frequently if not always has a decided advantage over those who are not.
An overriding attention to first-rate customer service is another tactic these operators use in common. They all stressed that building personal relationships with customers and continuously demonstrating how much you value and appreciate customers is nothing less than absolutely essential.
All of them agree that filling the seats, and keeping them filled longer, will grow revenues and market share. They do this with exemplary customer service but also through regular promotions. One said, "Just come up with some reason to have a party."
Primarily, these operators market their promotions inside their businesses through their regular customer base—good old "word-of-mouth"—though some also embrace the most modern communications methods such as text messaging, e-mails and web-site posting.
Finally, they agree that the key to increased "seat time" is to provide customers with some entertainment or amusement. There are plenty of traditional bar amusement options that can be dusted off and enhanced, but there are also a whole range of new technologically spawned entertainment alternatives that are low-cost when provided by a vendor.
To grow our businesses in the face of economic and social threats takes determination and resolution. An owner must be determined to win, to beat the competition. We must work harder and smarter than everyone else.
Some are working harder and smarter than their competition and they are winning; some will start soon and they, too, will prosper. Some won't change anything and...well, you know.
It is clear: a return to the fundamentals of a good bar business is the answer.
Source: The Montana Tavern Times, April 2009, published monthly by Continental Communications, 125 W Granite, Suite 102, Butte MT. 59701