Cm Has The Season Been Up Or Down

[Mapguy]

Well let me give a few of my thoughts on the subject of why business is down.

I think in reality its a combination of quite a few things

* People world wide are cutting back or eliminating their holidays due to overriding issues such as will I have a job in 6 mos; if I have no job, what about my house payments, my car payments etc. Lets cut back on the holiday expense or maybe elimininate it this year. We'll treat ourselves better next year.

* The higher cost of oil/fuel.... ='s much higher cost of transportation. Yes, the oil prices have dropped around half in the past 2-3 months, but reports that I have read indicate that no one has informed the airline industry. They do not seem to be in a hurry to cut the fuel surcharges.

* The Bangkok problem is on the news almost daily internationally. Yes , we know that the problem is limited to a very small section in Bkk, but the good people back in Podunk, Europe or America see it as THAILAND. I'd hate to mention the number of times I have been asked by people "back there" is it safe or is there a problem in coming to CM. They perceive a potential saftey issue. This does address the deep south problem that has now gone of for a some years.

* Also now it has been reported that the Bangkok Political situation has spread to Chiang Mai with the firebombing of a car a couple days ago.

* I was told that there are 26 countries that have now posted traveler advisorys re. visiting Thailand. Maybe more or less now.

There are probably more issues, but I think it is a combination of all of the above. With MONEY , or possible lack there of, that is the root cause of it all

In any event we are all here, we have got the difficulty and we will either live with it or we won't ....

However I am seriously thinking about expanding and opening "GONZO'S SOUP KITCHEN. Hard time bowl of soup and croutons for about 350 baht..... Hey this is Thailand. If I didn't make it last year, this year I must raise the price to cover my loss.

Gonzo

Pretty fair general assessment.

It is always difficult to generalize. Different folks go through different experiences. I think it is too poetic (or silly) to call the current economic situation a "perfect storm," but there are a number of seriously serious factors that do add up to a difference. Some people, I fear, are going to drown.

I did not live here during the last financial storm (the "Thai bhat crisis") but even now one sees the residue of that around the Chiang Mai landscape, particularly in residential real estate. But I don't think what is happening now is the same.

At the same time, different people get affected in different ways. Right now, in the expat community, the Australian community is getting blasted. So are the Koreans. Just to name a couple of groups. Generally, people who live on the edge must be holding their breaths --- and I sense a lot of people on TV tend to husband their bhat as much as they husband their internet connection!

Not to stop there, the real impact of the deflation of credit within the international economy has not yet, I think, impacted the Thai economy generally; I mean in the sense that the regular guy has been zapped very much yet, except in tourism, as least in Chiang Mai. I cruise around a bit, not in Spicey's, but around, and I see some people out and about, but I don't see very many at all. Sure, Nimmenhamin is busy on Friday and Saturday nights, but....

Nobody who has any business sense will invest in a Meridian type thing without being very well-capitalized and understanding that the payback is a very long-horizon deal. Or might they be stupid or over-reaching after all, like recntly decapitated barons of "Wall Street?!" Well, I suggest that, at least, the Shangra-La and a couple of other places better keep airing their rooms well to ensure no mildew forms! On the other hand, Conde Nast polls people who like the really, really posh resorts, so I'd question their economic influence. The really, really rich aren't so easily spooked or affected: the posh Chiang Mai resorts remain "mahvelous, darling, simply mahveous, except in late February - early April, dahling, when it gets more than a tad smokey! You simply don't want to do Chiang Mai then. Go to the beach, dear; go to the beach!"

For now, without a sense of panic, I suggest that the excrement has not yet fully impacted the air conditioning system in these parts.

Edited November 1, 2008 by Mapguy

[Gonzo the Face]

In agreement Mapguy.

Meanwhile look out for Gonzo Soup Kitchen.... Soup for the whole family...... still 1 bowl, but 4 spoons....

[cmsally]

I would say now is totally different from 1997, when tourists were attracted by the massive change (in their favour) of exchange rates. In 1997 it affected people who had overstretched themselves at the bank and large companies with overseas loans and of course the sudden drop in very high interest rates. Now what we are seeing is worldwide with a swing of exchange rates in the other direction. The local Thai on a fixed salary is probably not affected yet (well actually they have been already by high inflation), but Thais in tourism, real estate and other businesses certainly must be.

The difference this time is that the situation will probably be protracted so people's ability to survive will probably depend on the basic cost to keep their business operating (ie rent, staff, utilities etc) Those with a high basic operating cost will likely go first, not to mention the people who never do accounting and aren't actually sure if their business makes a profit!

[whiterussian]

Those with a high basic operating cost will likely go first, not to mention the people who never do accounting and aren't actually sure if their business makes a profit!

LOL! That me! Accounting by eye! "Im sure the shop looks understocked this week!?"

Im really bloody chuffed i can make about 20k a month selling 'stuff', although i have to split that with her indoors.

As for my noodle emporium, i have yet to see the figures. Ive heard we took 2000 baht on day one. not bad! Must be some margin on gruel!

p.s: anyone know a sally teaching at CMU? met her 2 years ago...

Edited November 2, 2008 by UKWEBPRO

[Ulysses G.]

There was a Sally at CMU many years ago who always wore purple, but she has moved to the school by 3 Kings Statue now.

[whiterussian]

There was a Sally at CMU many years ago who always wore purple, but she has moved to the school by 3 Kings Statue now.

Purple Sally with a Maori fella?

[Ulysses G.]

Yes, that would be Thoma.

[whiterussian]

Thanks, i met her 2 years ago, in BK, just wondered if cmsally was 'purple' sally

sorry for OT

[Ulysses G.]

I wondered the same thing, but she told me no long ago.

[cmsally]

Thanks, i met her 2 years ago, in BK, just wondered if cmsally was 'purple' sally

sorry for OT

Nope not me

[Gonzo the Face]

Even though I have not had very much contact with them, I, too, have know Tama and Sally for many years.

I did see Sally a couple months ago and she did seem very confused and upset. I know Tama had a few irons in the business fires , here in Thailand and do hope that they are not experiencing financial or other difficulty with the corrent economy .

gonzo

Edited November 3, 2008 by Gonzo the Face

[Ulysses G.]

From what I've been able to pick up over the years, Tama is loaded and does not have to worry about money.

[Bill97]

From what I've been able to pick up over the years, Tama is loaded and does not have to worry about money.

One of those guys who gets loaded and does not worry about money, a diehard hippie, wish him all the best, Sally too.

Edited November 3, 2008 by Bill97

[adjan jb]

Even though I have not had very much contact with them, I, too, have know Tama and Sally for many years.

I did see Sally a couple months ago and she did seem very upset.

gonzo

Sally is always upset. Nothing to worry about.

[whiterussian]

Lampoon electronic factory closed down this month, as well as factories in rayong,...bk, ... apparently 100,000 put of jobs this month...

here comes the financial tsunami ?

Edited November 21, 2008 by UKWEBPRO

[Gonzo the Face]

Maybe we should change the title of this thread from up or down, to down and lower.

Look at the bright side though..... if we're still around next year, it won't be so hard to beat last years numbers

gonzo

PS I Hope

[Theyreallrubbish]

The bad news is that business is down all over the country. One of my buddies just visited from Phuket and he says it is quite noticeable there also even though I would guess that they have some of the highest number of tourists in the country.

The good news is that almost every tourist-oriented business I know in Chiang Mai is doing quite well right now. It is my guess that if tourism is strong at this time of year and under these circumstances, it should be OK during high season (unless things get much worse). After that, who knows?

I don't think the effects of the economic crisis in the west is going to be felt until next year in terms of visitors due to the timescales involved. The financial crisis began in August 2007. This didn't affect most people directly unless they were trying to sell their house, but since March of this year and paricularly since June we've seen accelerating unemployment growth and collapsing consumer sentiment.

These effects, coupled with continuing falls in house prices that have now fallen to a degree that they are effecting people's sense of their personal wealth, will continue throughout this year.

As a large proportion of people visiting now will have booked prior to March the impact of the economic slowdown has yet to be fully felt.

I'd be interested to hear if local business people notice a decline in American visitors before the decline in Euro visitors as the US is about 6 months ahead of Europe in this downward swing of the business cycle.

But by the end of this year the US and Europe will be in a recession with already many months of rising unemployment causing great economic insecurity even for people still well off and in jobs.

The buzz word in the US this summer and one that is spreading across the Atlantic is "Staycation" as people have vacations at home to save money

I stick by this prediction of July and I'm sorry to say for everyone with a business that next year is going to be MUCH worse.

Right now look at cutting at every cost you can and look at alternative sources of revenue. Don't hold on to staff that aren't busy out of a sense of loyalty or hope that it'll get better soon. Start negotiating with landlords now to cut rents. Cut costs to weather the storm. The earlier you cut the more likely you are to come through this.

The worst part of the storm in the western markets won't be until the New Year and the worst moments for the economy will be in the Spring so next year the advance bookings for Thailand holidays by those from developed countries are going to fall off a cliff.

The good news (good for those that service tourists or live off western currency income) is I see a fall in the Baht next year as the Thai economy starts to really suffer and due to the normal results of fear in international finance. In times of fear money retreats from the periphery and returns to the core economies.

[Ulysses G.]

Right now look at cutting at every cost you can and look at alternative sources of revenue. Start negotiating with landlords now to cut rents. The earlier you cut the more likely you are to come through this.

Thai/Chinese landlords are not going to even consider lowering rents until a place has been vacant for several years.

Forget this one!

[Gravelrash]

Right now look at cutting at every cost you can and look at alternative sources of revenue. Start negotiating with landlords now to cut rents. The earlier you cut the more likely you are to come through this.

Thai/Chinese landlords are not going to even consider lowering rents until a place has been vacant for several years.

Forget this one!

Partly right except that they never lower rents. Seen one place with said landlord vacant for 8 years, overpriced rent not negotiable.

[Mapguy]

Thanks, i met her 2 years ago, in BK, just wondered if cmsally was 'purple' sally

sorry for OT

No, you mean Sally the economist

Anyway, what's that got to do with the topic? What happened to the PM function?

Re the economy, the effect of the "Thai bhat" crisis was much more rapid and (thus far) much more devastating regionally, but I am less optimistic now than I was when I last posted on 2 November [#181]. Two factors: hungry sharks ( short sellers and hedge funds) and frightened people in the water (including well-healed CEOs as well as pensioners of much lesser means.

In Chiang Mai, this is quite relevant. Tourism is a big deal around here. the Four Seasons won't suffer much, I suppose, and the Shangri-La got lucky with the ASEAN conference (probably by offering rooms at USD10 a night to fill the place up! But what about everyone else?

In the meantime, in global news, isn't it great that General Motors of America has given up a couple of its corporate executive jets??!! Gee! Once, a GM CEO (Charles E. Wilson) said something like what is good for the country, is good for General Motors!" Maybe it is time for a "transformational chief" at GM and throwing out the GM CEO the other dinosaurs there just as the recent elections of the USA seem to have indicated as justified.

Edited November 22, 2008 by Mapguy

[Theyreallrubbish]

Right now look at cutting at every cost you can and look at alternative sources of revenue. Start negotiating with landlords now to cut rents. The earlier you cut the more likely you are to come through this.

Thai/Chinese landlords are not going to even consider lowering rents until a place has been vacant for several years.

Forget this one!

You need to swallow your pride and approach them as your patron and explain your in difficulty and ask for their help. Its then difficult for them to refuse to help as their own status as patron in a feudal society depends on their being able to help those that support them.

If you go in as an equal they are very comfortable to say no as since you are equal to them you don't need their help

[CobraSnakeNecktie]

Right now look at cutting at every cost you can and look at alternative sources of revenue. Start negotiating with landlords now to cut rents. The earlier you cut the more likely you are to come through this.

Thai/Chinese landlords are not going to even consider lowering rents until a place has been vacant for several years.

Forget this one!

You need to swallow your pride and approach them as your patron and explain your in difficulty and ask for their help. Its then difficult for them to refuse to help as their own status as patron in a feudal society depends on their being able to help those that support them.

If you go in as an equal they are very comfortable to say no as since you are equal to them you don't need their help

I used a different tact. In the last few months there are more and more vacancies in my building. 6 months ago landlords were asking 14k baht a month for apartments and now asking 11K and still vacant. i told my Thai landlord the deals are so good that I really have to move to one of the better priced units. He offered to knock off some price and the difference covers my utilities. Win Win.

[Ulysses G.]

Right now look at cutting at every cost you can and look at alternative sources of revenue. Start negotiating with landlords now to cut rents. The earlier you cut the more likely you are to come through this.

Thai/Chinese landlords are not going to even consider lowering rents until a place has been vacant for several years.

Forget this one!

You need to swallow your pride and approach them as your patron and explain your in difficulty and ask for their help. Its then difficult for them to refuse to help as their own status as patron in a feudal society depends on their being able to help those that support them.

If you go in as an equal they are very comfortable to say no as since you are equal to them you don't need their help

You may be right. I didn't want to pay yearly for one shop, even though I had agreed to it when initially renting the place. I approached the landlord in much the way that you have suggested and I was pleasantly surprised that he agreed to change the terms of payment. I do have a big brown spot on my nose that won't wash off, but that is business.

[whiterussian]

Anyway, what's that got to do with the topic? What happened to the PM function?

re sally: Her hubby is the pioneer of the internet/online biz in CM.

Re GM! haha somnamnah for years of gaz guzzlers! see: http://www.fknnewz.com/view/196/free-marke...ts-more-112108/

[Gonzo the Face]

Back to the thread topic...

Here is a quote taken from the internet version of the Bkk Post today...

"(BangkokPost.com) - Thailand’s tourism growth between the first and third quarters recorded 3.49 per cent, according to Tourism and Sports Minister Weerasak Kohsurat." [ I think the sports min, has been kicked in the head too often ]

With regards to Chiang Mai, does anyone believe his crap..... if so I would like to hear your reasoning....

Gonzo

Edited November 23, 2008 by Gonzo the Face

[cmsally]

Chiang Mai to me looks unusually quiet for this time of year, but maybe that's a case of me being in the wrong places at the wrong time.

But normally busy tourist areas look pretty devoid of tourists - anyone agree?

[whiterussian]

Certainly few English speaking tourists, my biz is in a Thai market (a real one - not a tourist trap)

Seen mainly French tourists, the odd German coach load... but pretty safe to say mainly French for the last two months...

I wonder if this is because of the strict employment laws in France, almost impossible to lay off workers...

(farangs automatically bargain too much, we vendors see farang and we dont see walking wallets... we groan at the protracted bargaining they will attempt).

Edited November 23, 2008 by UKWEBPRO

[dave2]

Chiang Mai to me looks unusually quiet for this time of year, but maybe that's a case of me being in the wrong places at the wrong time.

But normally busy tourist areas look pretty devoid of tourists - anyone agree?

i hate to agree with you cmsally but this picture was taken in Thapae Road at 2 30 yesterday afternoon .

sadly devoid of people on a saturday afternoon : (

regards ...dave2

[Ulysses G.]

IMHO, there are a fair number of farangs around, but they are mostly the type that spend little money. The generous, middle-class type tourists are worried about the economy and even more, the political situation in Thailand.

They have good lives and don't want to chance visiting a country that has been in constant turmoil for several years and where throwing hand grenades at innocent men, women and children is somewhat common.

[Mapguy]

Surprise! Surprise! Today's breaking news:

(BangkokPost.com) - Thailand’s tourism growth between the first and third quarters recorded 3.49 per cent, according to Tourism and Sports Minister Weerasak Kohsurat.

Unlike many countries that reported a negative tourism growth, the number of tourists during the first three quarters in Thailand continued to be positive, Mr Weerasak said.

He added that many countries, such as the United States, the United Kingdom and China, voted Thailand as one of the most attractive tourist destinations despite the oil price hikes in the beginning of the year and the prevailing global economic downturn.

The minister said the government will launch different tourism promotion campaigns, such as the ‘Iron Chef Nationwide’ to promote Thai food. He said the government has allocated a budget of 374 million baht for the ministry to implement different tourism projects in 2009.

Foreign tourists generated over 600 billion baht to the country while Thai tourists generated about 300 billion baht, he said.