Coronavirus Economy: Significance of Social Distance for Walking Tour Business

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Coronavirus Economy: Significance of Social Distance for Walking Tour Business

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About 20 years ago, David Mebane founded Fat Tire Tours in Paris. The goal was to share with the tourists the city he adopted by himself on two wheels to roam the Eiffel Tower along the Seine and go for a picnic in the castle gardens. Today, Fat Tire operates globally in 12 cities around the world, from London to Berlin, Barcelona, ​​Europe, Washington, D.C., Chicago, San Francisco, and New Orleans, USA.

The 44-year-old CEO is headquartered in Austin and lives with his wife and two children. However, Mebane travels around the world on a regular basis to maintain her role as a “Chief Engagement Officer”.

Fortune talks with Mebane about the new series, Coronavirus Economy, asking how COVID-19 affected his employment situation and future plans, and how this emotionally and economically shared the news. I understand what you’ve been doing. The following Q & A has been edited briefly for clarity.

David Mebane set up a Fat Tire Tour in Paris to share with her tourists the city she had adopted as her city on two wheels. Courtesy of David Mebane

Fortune: Typical
What ’s your favorite day?

Mebane: That’s a great question. I am somewhat involved in operations, but only at a very high level. A few years ago I hired management. I have the title of CEO, but the president is in charge of the operation. And a senior management team. I have a much larger 30,000 foot operator. I look up weekly metrics, bookings, customer ratings, and more. I am not involved every day. Is much more strategic.

But
Culture is very important to me and we have a fat and very special source of secrets
Tires, very family atmosphere. Therefore, it is worth maintaining it. had
Heart attack in Paris, actually 39 years old. As you can imagine,
It happens especially at such a young age with two children—your concept and values
Time changes. We all know that time is the most valuable product,
We, and I, too, raise their hands here-unless acted upon, act on it. so I
I spend a lot of time with my family. Fortunately, the job is
priority. But it is today.

When
Did you notice that the situation is changing?

It was gradual, but I don’t think you probably noticed it a month ago, perhaps until northern Italy was affected. I started talking with the Italian manager every day. I called him in the morning and heard the street words. Then I started to notice the tendency of booking. Future reservations began to decline in April and May, and cancellations were scheduled in March. Until last week, it was a “don’t miss” approach to existing reservations in April, May, June and July.

What is it
Is it usually this time?

we
Work in a periodic business cycle. Summer is high and winter is low. I will say
Almost all tourism companies operate with a small loss in late December
From January to February. Flip during spring break
to make money. It was the same for 21 years.

And
now?

We are at the lowest point of cash reserves. So when you really need it and you can make money, you can’t find a customer anywhere on the planet! San Francisco has not given Berlin any help since the whole world has closed down towns, and vice versa. There is no place to float. There is no tide to raise every boat. In fact, all boats are sinking. It is a really unstable situation. Cash is king and you really have a problem if you have no or no expectation of winning it.

Fat Tire Tours operate globally in 12 cities around the world, from London, Berlin and Barcelona to Washington DC, Chicago, San Francisco and New Orleans. Courtesy of David Mebane

On March 13, it was decided to suspend global operations for one month. What made you decide?

Decided for us in some way. When the travel ban came into effect, I thought, “If the airline doesn’t fly, there’s no customer.” I consider it hibernation. We are bears. You need to dig a cave and sleep. They do so to save energy. We are trying to save money.

Externally
What steps are being taken to be able to resume?

If you book and request a refund, consider 150% value instead. For example, if you book a tour worth $ 100, instead of refunding $ 100, you will be offering a $ 150 IOU for future use. Surprisingly, a very high percentage of customers use that option. It shows that they are confident in us, the future, and travel. We encourage people to use social media to buy gift certificates that do not expire.

what
Are you doing it in-house?

We went into triage mode and checked all costs. We are looking for free rent from landlords. We have reduced all employees as much as possible. It is not to make me happy, but to pay them. The future plan is to be as lean as possible. No one knows about the timeframe or government assistance, so we dig as deep as possible.

For each staff
What are you using?

The majority are our tour guides who are independent contractors. This is about 90% of our staff [no work]. In eight of the twelve cities, they have also been streamlined to general managers. The other four, including Paris, are part of a larger business and therefore have additional people on the contract. But now everyone is working from home.

paid?

that is
Question. Can I pay the remaining paid employees? Every Monday
Strategy meeting. Our goal is to maintain all these operations,
Protect each employee. Its a real chance
Happening is not good. Some businesses closed last Friday,
Open. Some people employed today are not this Friday. that is
No money to pay, not because I don’t love
Those. I am currently feeding my company personally. Technically not me
Responsibility, but I feel obliged to do so.

So
Business owner, how do you generally feel?

It stinks and stinks. People will be unemployed if they have not yet lost. You will struggle to buy metro tickets and groceries at Monoprix. The glass of wine you had yesterday is prohibitively expensive today. Even if all countries were able to quarantine and stop the spread [and I think that was unrealistic], people would not rush to Europe the next day. There is a kink in the hose, and removing the kink does not mean that water will jump out the other end.

what
Do you need to happen to recover?

From a sightseeing perspective, it would be great if the second half of summer could be done, like July or August. Otherwise, you will fall back into the low season cycle. Then you are already at a loss for a good year. This year will be even worse. We are planning to not succeed for a year now, but we hope the spring break in 2021 will be the opportunity to get back to work as we wish.

That said, the tourism industry will have a great deal of wear and tear. If today’s Paris tourism has 100 suppliers, it will be 50 or 20 suppliers. Fewer, but surviving companies will gain market share and are more likely to be successful than before this occurred. I want to be one of the surviving companies.

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Subscribe to Fortune’s Outbreak newsletter to compile daily articles on the coronavirus and its impact on global business.

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