A handshake symbolizes Southwest Florida’s economic dilemma resulting from the coronavirus pandemic.
“There’s a trust issue that has to be overcome so that people will feel comfortable again and go out and enter the marketplace,” says Christopher Westley, dean of the Lutgert College of Business at Florida Gulf Coast University.
Westley understands the apprehension some may have about socializing again, and even shaking hands, which until recently was the most common physical way to greet people around the world, and to seal business deals. The time-honored gesture of mutual good faith fell by the wayside from a fear of disease transmission—but removing the handshake is a metaphor for the lack of trust we have in the economy now, Westley said.
A comparison can be made with how pioneering companies such as eBay and Amazon had to convince people to feel comfortable engaging in a new kind of commerce when they launched in the ’90s. Their business models are dependent upon people overcoming security concerns in making online purchases.
“And we’re in a similar situation today, where a lot of buyers lack trust in a lot of sellers right now related to the virus,” Westley says.
CIRCLE OF TRUST
On the surface, economic factors seem mathematical and scientific, rooted in logic. But personal feelings and emotions often drive the market and economy— triggering ups and downs on Wall Street, for instance.
Economists call it “animal spirits.” These evolutionary instincts and gut reactions influence human behavior and form the basis for consumer confidence and trust. On the flip side, of course, is uncertainty. Individuals feel less certain about the future when their incomes are no longer secure or they have lost their jobs. At that point, “they cut back consumption and they start to save and they hold off on economic activity until things get more certain again,” Westley says. “In general, it’s a natural way that the economy recovers from a recession because once people hold back and start saving, it forces the market to correct and reorganize. When the economy corrects, the fact that people have been saving in the interim means that there’s an opportunity then for more sustainable growth.
As with any market correction, this scenario is expected to play out in the current economic situation. Local businesses able to reopen are feeding off a considerable amount of pent-up demand post-lockdown. The much-needed revenue provides a summertime surge, but where will we be once the pent-up demand is met? Consumers eventually will return to the marketplace, but FGCU wants to help close the gap by encouraging and accelerating the process.
“In this case, what we are trying to do is to help the process along,” says Westley, referring to FGCU’s recently launched RESTART SWFL, an initiative dedicated to helping businesses respond to the impact of COVID-19 on their operations, workforce, vendors and customers.
FGCU took a leadership role in rolling out an economic campaign—similar to what might be expected from government or business agencies such as economic development organizations or chambers of commerce. It makes sense, though, that perhaps this regional institution has a better chance of making a difference without a political agenda in an election year. Perhaps a community grassroots drive can make people feel comfortable and confident in venturing out again.
“We’re just trying to make the process easier and more efficient,” Westley says. “Even if we have a second wave, the threat of this will eventually go away, like they have in the past. People will eventually go back to the market. This program is to help that along.”
BRINGING PEOPLE TOGETHER
After FGCU closed its campus this spring and initiated remote education, Lutgert College of Business staff started weekly virtual meetings. “I call it the Social Distance Coffee Club,” Westley says.
“My intent was just to meet on a regular basis so they wouldn’t feel disconnected from their work if they were all working from home. In those early meetings, there was intense concern about what was happening and if there’s anything we can or should do as a college to help.”
Those business college sessions led to discussions with others on campus, in particular with Ann Cary, Dean of the College of Health & Human Services. Operating with the idea that good health makes good business, the colleges have united their expertise and resources to help Southwest Florida businesses.
“We’re natural complements in something like this because they bring a lot of the health expertise that the businesses need and we have a way to deliver some of that to the businesses themselves,” Westley says. “But it came from initial discussions of what we can do to just help people who are suffering. They wanted the university to be proactive; that’s how this developed over time.”
This challenge is to bridge the divide between people who want to reopen businesses quickly and people who are concerned about the virus spreading. “Both sides want to find a way to proceed and bring back economic growth,” Westley says. “No one wants to harm people in the process. So, I’m hoping a program like this will help promote that development.”
Believing that the path to recovery is anchored in consumer confidence, FGCU introduced the RESTART SWFL Seal of Confidence campaign to bring a renewed sense of confidence and prosperity to the region by encouraging business owners to adhere to a specific set of standards.
“We are requiring that they participate in a class or a panel discussion in the areas of business, health and ethics,” Westley says. “If business owners take two of these classes and take the pledge, they will earn this seal.”
The first web-based classes started after Memorial Day with information on health, cleanliness standards and mask-wearing. The goal is to assure customers that establishments have sound practices in place to ensure their well-being while providing fair value and service. If they advertise that to potential buyers, customers are more likely to feel comfortable reentering the marketplace.
“That trust issue goes both ways,” Westley says. “The seller also needs some assurance and trust that customers are acting in compliance with certain requirements that they need in order for trade to occur.”
Larger businesses usually have more resources to communicate to consumers that their establishments are safe to enter, he said. “Many small businesses that are taking that approach probably don’t have the resources or the ability to communicate it, and they are just making do as best they can. And that was a big concern for us because that (small business) fuels a large chunk of economic activity in Southwest Florida.”
Because mom-and-pop establishments are extremely important to the local economy, the idea is to provide them with the ability to better educate the public and share their stories. “They employ the majority of the workforce,” Westley says. “They’re also part of the workforce most of us first enter as we start our careers.”
Now the hope is to restart some careers by lending a helping hand, even if we’re a little apprehensive to shake hands again.
After a March 20 executive order by Florida Gov. Ron DeSantis, no food
or beverages were able to be consumed on a restaurant’s premises, but food was permitted to be sold for takeout or delivery. The state’s Phase 1 plan on May 4 allowed restaurants to reopen dining rooms with 25 per- cent capacity, which subsequently has been expanded.
“It’s like reopening a restaurant for the first time again because of staff and food and supplies and equipment,” says Lois Croft, the Southwest Florida regional director of the Florida Restaurant & Lodging Association’s 3,000 restaurants in the region.
The association encouraged and helped restaurateurs apply for and receive relief funds, loans and assistance to help them pivot as they adapt to new policies and procedures that have changed the way they do business. “Everybody’s going to be a little different. There’s not a one-size-fits-all model,” Croft says.
THE STATE OF TOURISM
No matter how it’s described, everyone can agree that 2020 has not been business as usual. Unlike more commonly experienced disasters such as hurricanes, which we can clearly see and better predict, COVID-19 is an invisible threat without a clear path of destruction—but the pandemic’s damage still affected everyone everywhere.
WalletHub, a personal finance website, released a study showing Florida ranked sixth among the most impacted states when it comes to the coronavirus and tourism. Considering that the Sunshine State is near the top in travel and tourism spending per capita, has the third-highest share of GDP generated by the travel and tourism industry and ranks fourth in its dependence on travel and tourism, it scored points for its aggressiveness against the coronavirus.
Southwest Florida is preparing for the return of visitors. “We aren’t going anywhere. We know you’re not traveling now, but the beaches are still beautiful and everything is here, we’re just waiting for you to be ready to come back,” says Jack Wert, executive director and CEO of the Naples, Marco Island, Everglades Convention and Visitors Bureau, the official tourism destination marketing organization for Collier County.
Recovery is possible in late 2020 for area hotels, airports, restaurants and other tourism-driven services, but it’s more likely to occur in early 2021. “It’s going to take some time to ramp things back up,” Wert says. “I think it’s going to be a slow recovery. We will see some recovery, but I don’t think we’ll be back to the same levels we were by the end of the year.”
The lack of international travel will greatly affect Southwest Florida this year. Foreigners on holiday comprise about 20 percent of the area’s visitation on an annual basis but this year they are being kept away by worldwide travel bans and concerns.
We might see some international travel here by the end of the year, but Wert doubts it. “The crystal ball is a little bit cloudy. It’s a little tough to predict right now,” he says.
An eternal optimist, Wert arrived here shortly after 9/11 and saw the region bounce back after it and other economic crises. “I’m confident it will come back,” he says.
Although there’s a chance that mom-and-pop hotels will close, Wert said they have withstood every crisis that affected Southwest Florida. “They found a way to keep the doors open. They have the same people coming back year after year. They have a very loyal following.”
Smaller businesses such as charter fishing boats and airboat operators essentially are one-man or two-man operations that have struggled to stay alive. “It really depends on customer base,” Wert says. “Some have quite a following and will be able to hang on. It really has a lot to do with customer following.”
Paradise Coast Sports Complex, an attraction for amateur sports, partially launched this summer and has its grand opening in July in Collier County. “That’s going to help us a lot in the fall,” Wert says.
During late spring and early summer, the tourism bureau shared a soft message via promotional videos on social media and 30-second spots to digital devices via YouTube to basically let people know, “We’re here when you’re ready to travel.”
Early messages are intended to be more regional to promote summer travel within Southwest Florida. Areas in most of the state also are targeted during what customarily is a slow time of the year for tourism. Because restaurants have been a top destination for people spending holidays here, Wert said they are running a TV spot with a message specifically targeting the local market to “dine out in paradise.”
Commercials targeting states in the Northeast and Midwest are tentatively planned for October, November and December, when the weather turns cold there and triggers a seasonal interest in Florida’s warmth.
“As soon as we start to get into the recovery phase, we will introduce several more messages in the Northern markets,” Wert says—but “It is going to take people time to build up confidence to travel again; we need to build that confidence back, and that’s not going to happen overnight.”