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August 25, 2008
Feeling the pinch as travel worsens
Many BWI-area businesses socked by flight cuts, increasing costs
Diafie Tubah, an employee of Sunglass Hut at BWI Airport, helps Craig George, a passenger from St. Louis. The vendor is bucking the trend, as sales of sunglasses were up in July.
An $11 fare to drive a passenger fewer than four miles was all D.Y. Kim had to show for his morning's labors.
Kim had spent four hours in a taxicab stand at Baltimore/Washington International Thurgood Marshall Airport on a recent Thursday in mid-August, hoping for a big-money fare to Baltimore City.
And, he was quick to point out, the hotel to which he was taking his passenger offers free shuttle service from BWI.
Not that Kim had reason to expect otherwise these days, with the airline industry's woes exacerbating an already-slow economy. But he still groused what his spot at the front of the cab stand turned up.
"This is terrible. I think this year everything's dropped down," he said. "I'm already retired, so no problem. But some guys have a wife and kids to support, and it's hard for them."
Kim's is not the only pocketbook stressed by the flux in the airline industry. Across the country, airlines are cutting flights and air travel prices are climbing. Airlines, hotels, restaurants and the government lost nearly $29 billion last year due to air travel hassles, according to the Travel Industry Association. With more flight cuts gripping the industry this year -- even BWI's largest airlines, Southwest Airlines and AirTran Airways are scaling back -- the business losses could be greater. At BWI, fewer flights, and fewer people on those flights, have created a ripple effect felt by taxicab drivers, restaurant managers, hotel executives and others who rely on the airport to send business their way.
Many business owners have been forced to find new ways to compete for a dwindling pool of travelers. Boosting customer service, cutting staff, dropping prices and striking new partnerships are some of the ways they are trying to survive. Airport analysts say that while the effect can be damaging in the short-term, vendors who can wait it out still have one of the highest-traffic spots.
"We're at the mercy of the travelers," said J. Michael Sanford, president of the Greene Turtle Franchising Corp. The Greene Turtle sports bar, and other vendors at BWI, are offering lower-priced menu items and creating promotions to buoy sales. "We're all in it to weather the storm, because it's a good business opportunity for us to be here."
Eating on the cheap
Business in July is usually brisk at the Bob Evans restaurant near BWI. But on a recent Thursday, just a few tables were full, indicative of this atypically slow summer, Assistant Manager Joshua Roeder said.
"July for us stunk," he said. "It does seem like it's a little slow. It does seem like people aren't flying as much."
That has forced the restaurant to cut back on staff and the number of hours its employees work. Roeder said he is worried that if the servers are displeased with those changes, they might take it out on the customers. That could put a damper on much-needed repeat business, he said.
Last month was slower for some restaurant operators at BWI, too. Families are cutting back, with fewer trips to places like Disney World, said Mark Russell, director of new store development for Rockville chain Silver Diner.
He had projected that his BWI eatery would make $120,000 a week in July; instead, it's making $100,000 a week.
To appeal to travelers, Russell has made carry-out a big part of the storefront, and now it accounts for 20 percent of his business. In September, the airport diner will offer a new promotion: A handful of menu items available in 12 minutes or less, or they are free. The idea is to win those travelers who think they do not have the time to sit down for a meal.
Meanwhile, some BWI vendors are adding cheaper menu items to drum up sales. Obrycki's Crab House and Seafood Restaurant may introduce some $6 items in the coming months to entice diners who want to spend less, said Co-owner Cheri Cernak. Obrycki's BWI store anticipates making $1.3 million this year, significantly less than the $3 million sales in 2007.
Cernak attributes some of the dip to the sluggish economy and the fact that more restaurants, such as Zona Mexicana, have opened nearby.
But airport vendors say they can only do so much. Big marketing splashes will not go far since no one without an airline ticket can get past security. They cannot raise prices, either. BAA Maryland Inc., which runs BWI's concessions, requires retailers and restaurants to charge the same price at the airport as their other locations.
Room at the inn
Just as restaurants are dishing out fewer plates, hotels are turning down fewer beds.
The Hilton Garden Inn at BWI Airport is seeing fewer travelers during the week, which is usually a busy time for hotel guests in town for business meetings in the area.
Hotel General Manager John Durbin declined to quantify how much business is down, but as a BWI hotel, he said it is subject to fluctuations in the airport's business. In June, about 1.9 million passengers flew through BWI, a 3.3 percent drop from the same month last year.
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