Vail Valley: Steel yourselves – the road’s still bumpy
Vail, CO, Colorado
Based on the honest, and not necessarily encouraging information we received at last Thursday’s Vail Valley Business Forum I think business owners need to adopt a new term as we begin to get ready for 2010. Let’s call it “extreme planning.”
The challenge this year seems to mesh with the gut-wrenching feelings you get when you see a snowboarder huck 15 feet into the air with only a precision landing on a precise point in the arc of the halfpipe between them and an emergency room. Facing budget spreadsheets this year will feel like base jumping or strapping a bungee cord to your feet and diving off the Royal Gorge Bridge. It’s going to take courage.
The difficulties will not involve controlling expenses or being conservative in revenue projections – I think we’ve all got that down. The hard part will be in anticipating further risks to your plan and innovating new products and service lines to generate revenue. Those of us who are involved in tourism have the luxury of knowing that there may be declines in the numbers of folks who visit the Valley and the amount they spend, but (unless it doesn’t snow this year) we know some will come.
It’s a little tougher for those of us involved in providing services to residents. If consumer spending continues to drop, and we encounter what looks to be inevitable tax increases, some of our businesses will soon approach the tipping point, where the lack of revenue will force deep cuts in the number and perhaps the quality of the services they provide. In that scenario, the next step could be closure.
I wrote in this column last fall that, “This economy will obviate every flaw in a business plan.” For those who have corrected the flaws and are now presenting better and more profitable offerings to their customers, things won’t be so bleak this winter. For those who haven’t or those who intend to ride this out in the “status quo,” I wish you the best of luck.
It seems to me that getting through this is going to demand constant creativity and a thick skin. Our forum panel had some sage advice, citing examples of how they’re making it work. Expense control, labor force reduction, increased productivity, new distribution channels, asset protection, focusing on core business, improving service quality and monitoring return on investment like it was your own heartbeat – all good, sane stuff.
But it was easy to tell in listening to them that despite the variety of approaches they take and recommend, they all had one thing in common that may be the most powerful weapon in their arsenals: optimism.
Great business people over time have honed their skills to deal with things like this. What we haven’t become used to, and I hope we never do, is making hard moves that at times make us feel like we’re going backwards. Progress in a resort economy can come at a snail’s pace and often it can feel like two steps forward and one step back. When progress comes that dearly, one is loathe to retreat. It’s also hard to control costs when vendors, landlords and necessary professional service providers are also trying to keep whatever margins they have and keep their own enterprises running.
But it all must be done and surely better times will come. In the interim, at the least, all we can do is pull out all the stops, grit our teeth and make survival the highest priority. Think of how great the champagne will taste when sales go up, we make new hires and bonuses are back in vogue!
Michael Kurz is president and CEO of the Vail Valley Partnership.
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