Sunday, November 6, 2011

The Big Dry follows the Big Wet

Bangkok Post

The city's economy is suffering after entertainment venues are hit by declining numbers of patrons and face booze supplies that are quickly drying up

Across the clubs, pubs and tourist areas of the city the message is the same _ as beer supplies begin to dwindle, so too does the number of revellers that help keep the financial lifeblood of Bangkok pumping.
WHERE HAVE ALL THE PUNTERS GONE?: Patpong Road has far fewer visitors than usual. An empty Irish pub around Silom Road, below left. A jazz concert at the Sheraton Grande Sukhumvit goes ahead, but fewer people are in attendance than usual, below right.

"There's definitely a drop in revenues," said Denis Hemakom, manager of the popular Q Bar nightclub on Sukhumvit Soi 11. "Almost all the local population are gone; we're living off tourists now. I'd say [sales are] maybe 30% [of normal] overall. Our good nights are still pretty good, but our slow nights are very, very slow."

The impact of the floods on tourism and entertainment venues is no small beer to the government. Thailand is likely to lose about 15-25 billion baht in tourism revenues this year as the number of travellers drops because of the floods, according to the Kasikorn Research Centre, even if Suvarnabhumi airport, entry point for 70% of arrivals, continues to function normally.

Tourism Minister Chumpol Silpa-archa said arrivals could be up to one million below the government's target of 19 million this year. The tourism industry employs more than two million people and accounts for 6% of GDP.

A visit by Spectrum last week to Silom Road, normally bustling with revellers, showed many empty bars and restaurants. A waitress at the nearly empty Molly Malone's, an Irish pub on Soi Convent, commented that they had plenty of beer but no customers or water.

The part owner and manager of another popular pub nearby said they had virtually no patrons over the past three weeks due to concerns over safety.
"We don't know whether to applaud the government for handling the situation well or criticise it for overreacting and scaring people away," he said.

Beer deliveries have been unreliable due to transport problems; however, he added that the situation was now improving.

"We asked for 10 barrels, but I suspect we'll get one or two. But still, that's better than nothing."

He said that breweries still had stock, and it was still possible to buy bottled beer from supermarkets, although his staff were worried they might have to start selling large bottles of beer as small ones become scarce.

Breweries have indicated they are reducing production as a result of declining demand due to the temporary closure of major distribution centres in flooded areas.

Chatchai Wiratyosin, marketing director at Singha Corporation, said production of Singha draught beer has reduced slightly, resulting in a modest decline of beer stocks at pubs and bars.

However, even if the company's brewery in Pathum Thani is submerged by the floods, Singha's brewery in Khon Kaen has sufficient capacity to serve demand, he said. Nevertheless, Singha might have problems transporting beer from Khon Kaen to Bangkok as many roads are now impassable.

Sorrakit Lathitham, an executive at Thai Beverage, brewer and distributor of Chang beer, said that many breweries faced not only product shortages but a decline in consumption. However, the company was still able to make deliveries.

Heineken, meanwhile, is slowing production as some of its customers' distribution centres close due to the floods. These include Tesco Lotus, Big C, Tops and 7-Eleven.

One Heineken executive, who asked not to be named, said the company's production and inventory of raw materials had not yet been affected by the floods. But it started reducing production last week due to shrinking orders. Heineken has a production capacity of two hundred million litres of beer per year.

Nevertheless, Heineken was preparing for a worst-case scenario, the source said, with the possibility of importing beer from neighbouring production facilities. In Asia, the company has breweries in Malaysia, Singapore, Vietnam, Indonesia and China.

Patpong Road last week had many empty bars but no shortage of men touting "ping-pong" shows and "full body" massages. The problem for them is one of demand rather than supply, although many bar girls have returned to the provinces, said one manager.
"Stick" of, a popular website keeping tabs on the capital's seedy underbelly, told Spectrum that "Halloween [last Monday] is usually a big night but this year it was the worst in memory with fewer staff in the bars and even fewer customers. Generally, trade seems to be down and some bars have run low on certain products, notwithstanding that customary numbers are down, as are sales."

On Silom Soi 11, Bed Supperclub went ahead with its Halloween party and the turnout for a Monday night was quite good.

Mr Hemakom, on the other hand, said that Q Bar's Halloween party was cancelled. They were experiencing some beverage shortages, mainly of Singha soda water and Coca-Cola, though these have now eased.

He also commented on the cost of sandbags and flood safety preparations. "We spent good money raising electronics off the ground floor.

"The main effect has been on the customer though," he added.

"For the most part, I think the effect has been on the confusion people have over whether or not flooding is coming. It puts a downer on the party mood when you think your house might be underwater."

A centrally located five-star hotel's public relations manager told us that at this time of year they would normally expect full occupancy, but that numbers were down significantly with many cancellations. "Luckily, half our clientele are business travellers, and business for them has to continue regardless."

Concert promoters are also feeling the pain. At the time of writing, David Foster's Oct 31 concert was cancelled. Yesterday's Jason Mraz concert was cancelled. Tuesday's X Japan concert at Impact Arena, however, and Pitbull's Nov 28 concert, are going ahead. The World Film Festival of Bangkok has been postponed until Jan 20.

Sukhothai's famous Loy Krathong festival will go ahead this week but the Royal Flora Ratchaphruek Fair 2011 in Chiang Mai has been postponed until Dec 16.

Countless events and promotions have had to be rescheduled or dropped, as residents flee and travel advisories discourage visitors.

Kittitouch Srivimolwattana of Universal Music, Thailand, said the music industry was "definitely affected by the flood crisis. Many of our stores have closed and of course sales have dropped. That's the key factor really while consumers are more concerned about the floods than our new releases."
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