Quick Change: Business owners credit innovation, resilience and luck to COVID survival
The COVID-19 pandemic and the resulting lockdown caused economic disruption and prompted local businesses to pivot and take new approaches to business strategy.
As our community prepares to emerge from the lockdown, businesses are struggling to recover from its after effects. Here’s an inside look at some local business owners, how they’ve survived, adapted and plan to grow into the future:
Spencer Stegenga, owner of Bowers Harbor Vineyards (BHV), adjusted his business model when Gov. Gretchen Whitmer ordered the closing of indoor wine tasting rooms. He immediately rented two oversized tents and moved BHV’s tasting rooms outdoors among the grape vines.
Fortunately, BHV already possessed an outdoor wine tasting license issued by the Michigan Liquor Control Commission. If they had not previously procured it, the transition to serving outdoors would have been delayed by months. Great weather helped – Stegenga said they were “blessed with only one Saturday of rain.”
BHV also focused on ramping up its social media. They tripled consumer wine sales by catering to their wine club members and growing curbside pick-up. Stegenga attributes retail wine sales growth to the compassionate, local wine enthusiasts that made an effort to support BHV during tough times.
Doug Petersen, owner and operator of The Well, an athletic training and health coaching studio (located in the Box building in downtown Traverse City) says he witnessed a significant shift in his business, with some good and some bad news.
Yes, group fitness classes were prohibited, but the virus also prompted many to think about staying healthy.
“(When) fitness classes were cancelled by our governor, I had to change my business model overnight to exclusively one-on-one training,” Petersen said.
Petersen says that unless an individual is over 70 and has comorbidities, isolating can present multiple health issues. Over time, Petersen says he noticed that his clients started to take control of their health, recognizing the value of a robust immune system.
John McGee and Glen Harrington, owners of Harrington’s By the Bay, Sorellina, McGee’s 31 and McGee’s 72, have survived the COVID shutdowns by being innovative.
In addition to immediately changing seating, adding plexiglass and shifting staff members, they also transformed their to-go revenue stream from 2% of their total revenues to 100% overnight. They temporarily shut down McGee’s 31 in order to transfer staff to the remaining three restaurants. The owners changed their menus, added new family meal packages and offered buy one, get one free meals in an effort to keep their staff employed. So far, that BOGO offer has totaled $375,000 being pumped back into the local economy.
The Payroll Protection Program (PPP) was also essential to their survival, as were a handful of generous, loyal customers who cashed in their personal stimulus checks and asked that the money be distributed to restaurant employees. Prior to COVID, the partners had diversified personal resources into a self-storage project called Stafford Ranch Barns, a 68-unit condo storage project. This successful side business provided additional cash flow at a time when the restaurant industry was struggling.
Mark and Stephanie Wilson, owners of Maxbauer’s Meat Market, are a resilient, dynamic duo, surviving an embezzlement, a store fire, and recent COVID changes to their business.
With restaurants shutting down, their meat and grocery sales exploded. They responded to the increase in meat demand by purchasing and utilizing an American-made vacuum sealer. This machine allowed them to process meat 50% faster while decreasing waste. The amount of water and packing materials used in packaging meat and fish was reduced by 75%. Now meat and fish products are handled once (versus several times previously), which increases employee and customer safety. The innovation also delivers extended product shelf lives and convenience for gourmet chefs.
Chris Mohrhardt, owner of Pangea’s Pizza and Incredible Mo’s Restaurant, quickly realized that carry-out pizza alone could not support both of his businesses when the dine-in portion was required to close again this fall. Mohrhardt had to reduce staff hours while exploring many alternatives to incorporate his loyal staff.
Incredible Mo’s was eventually able to reopen for bowling and games only. At Pangea’s on Front Street, Mohrhardt quickly purchased five professional ice fishing igloos and converted his summertime rooftop bar into a distinctive, outside family dining experience. Once this began to take off, Mohrhardt increased staff hours to full-time and even brought back some of his summertime staff to help.
Mohrhardt says operating two restaurant businesses during COVID has taught him “to be nimble and never get angry over things I can’t control.”
He also says he discovered how loyal his staff was and how important it is to “communicate all aspects of change to my employees, who are truly team players and want to succeed as much as I do.”
Connie Deneweth, CPA, is a developer and managing member of Copper Ridge; a former board member and vice chair of Munson Healthcare; current chairperson of the Munson Healthcare Audit Committee; co-chair of the Grand Traverse Area Catholic Schools capital campaign; and a board member of the Cherryland Cares Foundation and the Oleson Foundation.