Bill Geist's Zeitgeist

What it's Really Like

As I've told audiences on several virtual Annual Meeting presentations we have done for Destination Marketing Organizations, what we thought would be a universal understanding of the pain caused by government-ordered shutdowns simply hasn't happened. And, that's because a lot of people don't work in hospitality and can't fathom the depth of pain we feel. They're still working; getting a regular paycheck and benefits. They may be inconvenienced by the 'VID...but they aren't looking at eviction.

Terri and I have a special affinity for Hell's Kitchen, a Minneapolis bar-restaurant that hosted our DMO client-and-friend reception when Destinations International met in the Twin Cities in 2016. If you were there, you know how nasty cool this employee-owned spot is.

Terri continues to be tickled by their irreverent e-mail marketing (We're happy to be offering delivery & curbside pickup so you can take a little Hell home with you)...but shared this recent missive with me last evening. While the majority of the e-mail was about opportunities to make Hell's Kitchen part of their fans' Halloween, there was this at the close of their message:

As promised, we want to keep you up to date with how HK is surviving COVID because so many of you have written that you like our "behind the scenes" news. Even though we expanded our hours and delivery range dramatically last month, the truth about trying to survive COVID as a large, downtown restaurant with high fixed costs and real estate taxes remains harsh:

We're thrilled with all the orders we've received for Pickup and Delivery, but the numbers don't lie: our total September 2020 income was just four percent of what we brought in September 2019. That's not a typo: our business is down 96% compared to last year's same period.

Our staff roster pre-covid was 155--it's now at 7, and that's after bringing back more employee-owners to help with delivery and expanded hours.

When we first closed down on March 16, we were completely debt-free and had money in the bank. That's why we were so positive in April..."don't worry, folks. We have our savings account to get us through this temporary setback" (keep reading to see why we're still optimistic). On March 16, our "current" payables to food and service vendors amounted to approximately $193,000 (we've always paid invoices on time, so nothing was past due). Of that amount, we've paid off all but $15,000 and are almost caught up. We're thrilled that we've been able to honor our commitments to our critical food suppliers, but it drained our savings completely.

As the virus continued to drag on into fall and we still had mounting bills (remember, our "burn rate" while closed is still well over $50k/month), we were finally forced to dip into our PPP funds in early September. Many people think "but that government stimulus PPP money was forgiven, wasn't it?" Nope; in fact, NONE of it was forgiven because we did not have anyone on payroll during the government's "time limit," a restriction which made NO sense whatsoever for restaurants throughout the country that were (or are) still shut down to help control the spread of the virus. So ALL of our PPP money is now DEBT which now must be paid back.

Re the PPP loan: No matter how frustrating it was to once more take on debt, we're still grateful, because we honestly feel this loan will give us a long enough runway to survive COVID through next spring if we spend our pennies wisely. Our mantra is "Every. Penny. Counts." For example, we now drag the soiled linens home each week rather than pay the linen service. We moved all of our banquet supplies from our rented storage lockers ($412/mo) to our empty dining rooms. We cancelled every contract we could (grrr to those mega companies who don't give a damn). Even our many phone lines are now down to only a few, and our unused bar coolers/refrigerators are turned off to save on our electrical bill. Baby steps, righhhht?

That's our story and yes, we still have a lotta moxie and hope. We didn't share these details to despair, guilt-trip or inspire fear; our skeleton crew is doing an amazing job guiding the business back to safe harbor and we're confident that Hell's Kitchen will weather the storm. We only share these admittedly-scary numbers because we want everyone to understand the reality of running a downtown restaurant that was dependent on 1) office occupancy, 2) hotel occupancy, 3) convention center activity and 4) visitors to downtown music, sports, and theatre events.

So whether you're in NYC, Nashville, L.A., Seattle, Charlotte, Houston, Chicago or any other major metropolitan area, don't forget to also support the indies that have helped make your downtown experiences unique and marvelous all these years. Those "takeout and delivery" orders mean the world to us all as we wait for this nightmare to be over. Your help now allows us to get back to normal and take care of you when our dining rooms finally reopen.

Be well, stay swell and VOTE!

We know Hell's Kitchen will survive; it's who they are. But, did you catch all the contracts they've canceled? What about those companies...and the ones that depend on them? The ripple is frightening. And, most Americans don't recognize that this all will impact them in the next year.

Did you also pick up on the real estate taxes that contribute to their "sunk costs?" That government has ordered these businesses closed, shouldn't there be some relief there, as well?

And, of course, Congress continues to sit on its hands.

Be well, stay swell and VOTE, indeed.

Join Us Tomorrow

Four former Destination Marketing Executives have been invited to share their take on 21 predictions for 2021 tomorrow at 1 ET / 10 PDT. David Downing, Matt Stiker, Josh Collins and I will be on a panel as part of the eTourism Summit.

To join us, register here: http://bit.ly/2UAk80d

Should be a wild ride.

Most Simply Don't Understand

Congress takes a lot of crap for being out of touch...but we keep electing them. And, maybe our own collective lack of understanding of what makes an economy hum is reflected in their utter lack of concern for just how bad it's gotten for the hospitality industry.

This article from one of Madison's newspapers is simply chilling (no pun intended). With temperatures dropping into the 40s and 50s, outdoor drinking and dining becomes increasingly difficult. And, with the virus spiking in Wisconsin, patrons here are increasingly skittish to head indoors.

The result, scores of restaurants are closing for the winter...and some forever. If you're from around here, you know the names. If not, trust me, these are big names and icons we're talking here.

Without another round of financial assistance, our communities will be mere shells of what made them attractive and successful. The losses we are experiencing here in Madison is just the tip of a mammoth iceberg that nobody seems to want to notice.

Winter is coming.

Words of Wisdom

Destinations International staged the first day of its annual Advocacy Summit as a virtual event last week...and the early returns are two thumbs up.

There were a ton of takeaways during the day long idea-fest...but one resonated most with me.

Gary Sanchez, Director of Public Affairs for Visit Dallas, shared some of the trials and tribulations his organization endured after an external audit excoriated the agency last year, putting its contract in jeopardy with the City. While many of the findings merely showcased that the auditors didn't understand how Destination Sales and Marketing works, there was enough smoke to capture the attention of the City Council, some of whom were demanding a split with Visit Dallas.

How did it come to this? Gary said, "We sold Dallas...we never sold Visit Dallas."

And, ain't that the truth? We are often so busy doing our work that we forget to let our investors know what and how we do.

As we emerge from this tragic crisis, we must vow to never lose sight of the fact that we are in service to our communities. And, that means copious communication until we are sick of communicating.

Because, at that moment, we will have just cracked the surface.

Day Two of the Advocacy Summit is November 12th.

Who's Working?

I've always been fascinated that nobody seems to care that the two most important jobs in the land are simply ignored for two months every four years. Indeed, the jobs of those running for re-election at any level are pretty much abdicated as incumbents turn their focus solely on keeping their jobs.

In a normal year, I suppose we could let this slide...but, this is far from a normal year. There are initiatives on the table that require immediate attention. Not after the election and not after the inauguration. Now.

And, as the Senate turns its attention to confirming a Supreme Court Justice (when the ranking Party blocked the previous administration's attempt to fill an empty seat on the grounds that an election was nigh), forgive me for my short-term view of the world. In the hotel world alone, the absence of another round of Federal relief will force 74% of hotels to lay off additional staff and 67% would face closing their doors and moving into foreclosure.

And, the Administration is tinkering with another round of aid to the airline industry because they've got a bigger lobby.

Every hotel in the land should ensure that every employee is registered to vote. And, every hotel should provide transportation to the polls next month for those that choose to vote in person.

Because this Congress and this President have failed you all.

 

The Psychology of Sticking with an Incumbent

For those of us that vote for candidates we believe will work to enhance our lives, it's a head scratcher when we watch friends and colleagues steadfastly stick with an incumbent when they have repeatedly failed to do just that.

New research provides the answer. And, to channel Duke Tumatoe, "it's not their fault." 

From Fast Company Compass, researchers at John Hopkins have studied babies that randomly pick a block from a room full of identical ones and then ignore all the other blocks. This indicates that we like things because we choose them; not that we choose things because we like them.

Thus, humans are apparently hardwired to double down on choices they've already made, regardless of whether it is the right choice.

Isn't science marvelous?

 

This is How It Gets Done

Saying that he can no longer wait on the Federal Government, Wisconsin Governor Tony Evers yesterday announced $100 million in relief to the Tourism and Hospitality industry and small businesses within the Badger State...and, yes, Destination Marketing Organizations will be part of the package.

“Small businesses, including the tourism and lodging industries, are the backbone of our Wisconsin communities,” said the Governor. “The ongoing pandemic, combined with a lack of action at the federal level may force many of these businesses to shutter their doors for good. That’s why we’re investing another $100 million in businesses and communities across our state. Our communities are in desperate need of additional federal support, but we can’t wait a moment longer to do what we can here in Wisconsin.”

Bravo, Mr. Governor. And, thank you.

Can We Be Honest?

The President has directed that Republicans discontinue negotiations on a Coronavirus Relief plan, essentially meaning that there will be no relief until sometime next year, if ever. And, for tens of thousands of us...that will be too late.

I get that people have their reasons for supporting a man whose only redeeming quality is that the stock market has bloomed during his Presidency or that he is going to stack the Supreme Court...but, honestly? A President that effectively says "fuck you" to thousands of small business owners and puts millions of jobs in jeopardy to score political points with his base and Party? Who the hell does that but a narcissistic game show host that doesn't have this nation's good as a goal? If you lose your business or job, does who sits on the Supreme Court really matter?

And, don't parrot back that the Democrats aren't negotiating in good faith. The mark of a true leader is to keep trying to find a solution regardless of the tactics of the other side. Sadly, we don't have a leader in the White House. We have a divider; someone who thrives on conflict.

It's time to vote to save our economy, our hospitality industry and our nation's promise.

If all those who have been hurt by this President's cavalier attitude toward the pandemic, racial equity and this country's future could just abandon their misplaced belief in a failed philosophy of nationalism...could we actually return to American greatness?

It's time to take our government back. Unless you have a really strong argument in opposition (and, I'm so ready to listen to your retort), isn't it time to vote a different "party-line?'

Next month, vote against every Federal incumbent. They are all complicit in the dumpster fire in which we find ourselves.

Vote "no mas."

No Relief, No Recess

A coalition of over 200 travel-related businesses, municipalities and associations is demanding that Congress act on a relief plan before the November election. It's hard to believe, but that last relief plan Congress provided some segments of the economy was in March. And, that plan didn't focus on the segments of the service economy most impacted by the government's response to the 'VID.

But, as I mused earlier this month, members of Congress must be reminded of the sheer number of voters who are incredibly pissed off at their inaction...and will likely vote against any incumbent, at this point in time. The clock is ticking for a lot of voters.

For others, it's already over.

Here is COVID Relief Now's open letter to Congress. 

Check out the signatories. While nothing surprises me anymore when it comes to Washington politics, I sure wouldn't want to be standing for re-election and know that I have been complicit in the carnage that awaits.

Like We're Surprised

Not to pile on (well, maybe a little)...but the juxtaposition of the revelation that the sitting President, for years, has paid less in income taxes than I have is far from a surprise. Why else would he have tried so hard to block the release? We all knew...we just didn't push hard enough.

But, we should consider the ROI of the taxes we pay, n'est ce-pas? This should certainly suggest, for at least a moment, that most voters don't receive the ROI for their hard earned taxes that those they select do.

And, honestly...what kind of President needs to visually repurpose himself as a blonde Rambo (click image we recently saw in the most infamous speed trap in Wisconsin)?

While that shit surely delights his base, does his campaign actually think it will sway the middle?

And, is that who America really wants to lead us?