The Park Record editorial, September 9, 2009
September 8, 2009
Park City’s historic Main Street was bustling with activity over Labor Day weekend and the sight of out-of-town families strolling past shops with packages tucked under their arms was enormously encouraging. But local business owners know they are not out of the woods.
While economic forecasters are busy crunching numbers according to complicated formulas, most of us already know the coming ski season is going to be leaner than previous years. That said, many local business leaders are in a much better position to cope with lower revenues than they were a year ago. Staff levels have been pared down, the bells and whistles have been significantly muted, and most importantly, speculation has been curbed. At least we hope it has.
In hindsight, we now realize that last year a couple of local property management firms, heady from a string of prosperous seasons, overspent their budgets based on unrealistic expectations. Unfortunately, it appears they spent money that did not belong to them.
Betting they would cover their expenses once guests arrived later in the winter, a few management companies dipped into their advance-reservation deposits to cover preseason expenses. It was a mistake that turned out to be fatal for at least two local firms. Once the economy fell and bank loans seized up, they were unable to turn over rental fees to the unit owners.
In the meantime, Park City’s more responsible property management firms and the companies carefully guarded their reservation accounts and managed to make it through the year, battered but intact. Now they, too, are squinting into the future, wondering how the 2009-10 ski season will shape up.
The city’s surviving businesses, though, have learned some important lessons. Speculation is no longer considered a virtue. Playing the odds and selling the margins is played out and the economy is back to cash on the barrelhead and hard work.
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Many of Park City’s past visitors will return because they were treated well and felt their vacation was a good value. Rather than speculating about the numbers, businesses should spend the preseason tuning their product and polishing their presentation.