Struan Boot, owner of Alpine-Pacific Motel and Park Kaikōura accommodation says the decline in the tourist numbers has greatly affected the running of his business.
“Our motel fared well from the quake, only abut two rooms were written off. But our financial situation is definitely a lot more buggered than the rooms.”
Boot’s ‘buggered’ financial situation comes from the lack of visitors in what’s meant to be a peak season for his establishment.
“Revenue-wise, around this time of year we would expect weekly numbers to be around $6500-$7000 per ten days. But since November the most we’ve profited has been just under $3000 per week.”
And although $3000 is no short revenue for most self owned small businesses, this over 50 percent decline of revenue is a clear indication at the shortage in usual tourism business.
Boot’s business makes too much to qualify for the small business finance package, which qualifications apparently demand more than a percent 50 loss of usual revenue.
Three full-time staff have since left Alpine-Pacific Motel and Park Kaikōura accommodation, and are not the first to go.
Boot stated that his loss of staff came from the inability to give them hours and proper pay during the last few weeks since the quake. These employees are not the first to be downsized for the sake of business survival.
Some of the small town’s larger businesses have been left with nothing, despite being among the worst hit.
“Because we don’t qualify for the government help, we are needing to downsize just to be able to pay rent for the place. It’s a real shame that the government funding has such a strict set of rules for it,” Boot says.
Alpine-Pacific Motel and Park Kaikōura accommodation isn’t the only business to meet complications from the November ordeal.
Jane Meder, an owner of a self-run illustration business based along the East Coast just outside of Christchurch has had to completely close her business for the year.
“All my equipment got ruined in the earthquake, and without it there isn’t any thing I can do. My business runs off commissions and invoices and without proper equipment, unfortunately I've made myself redundant.”
This ‘self-made’ redundancy isn’t uncommon around self-owned East Coast businesspeople who have no choice but to shut down until their affairs are in order.
The quake has caused a ‘second winter’ for East Coast business that rely on increased summer trading, with just over 20 businesses still remaining closed in Kaikōura alone.
There were about 1000 employees and sole traders operating in the area covered by the assistance package, and most would have seen a loss of business. The long term economic state of these East Coast businesses and townships is still unsure.
Minister Steven Joyce has admitted to the eight-week plan not being long enough, and will re-assess the financial packages after Christmas this year.
Joyce says: “The further eight-week extension is available for businesses in the Kaikoura district who face a dramatic drop in their turnover as a direct result of the earthquakes and the closure of State Highway One. This package will only scratch the surface and will be reviewed at the start of 2017.”
This year’s tourism summer season is completely written off with the road closure. Next season most businesses that have been affected will have to rebuild their brand from nothing. It will be three to five years before most can think about it being back where it was.
As they start to think about reopening, businesses with loss of earnings insurance are advised to use their insurance first before accessing the subsidy. Ensuring the financial stability of the property should be top priority, closely followed by keeping needed full and part time staff.
Many larger businesses have started using charity site Give a Little to elicit donations towards helping their business stay open. The official Give a Little Kaikōura page has already raised just over $25,000 in the last 30 days. Several funding pages have been set up for communities to help with relief efforts.
Although the East Coast towns have been through a lot since the November quake, spirits and efforts of small business are not deterred as they lead up to Christmas and a much deserved break.