Yahoo Finance 'No doubt about redundancies': Coronavirus claims another victim
The coronavirus has already seen Australia’s restaurant sector take a huge revenue hit, but it seems the impact of the virus has hit another sector even harder: corporate events.
Prime Minister Scott Morrison has cancelled the Festival of Australia business week in China due to the spread of the coronavirus, just as software giant Atlassian cancelled its major annual developer conference in Las Vegas.
Atlassian had anticipated around 5,000 people would attend its event, but instead the tech firm will now hold a “remote summit”.
Google even cancelled its biggest event of the year, the Google I/O developer conference, which was scheduled for 12-14 May at Google’s Mountainview headquarters, and Tokyo is reportedly considering postponing the Olympics amid concerns about the spread of the virus.
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As event after event is cancelled, CEO of Meeting and Events Australia Robyn Johnson believes redundancies are just around the corner.
“I predict a lot of uncertainty for our industry,” Johnson told Yahoo Finance.
“If it continues to happen like this, you will no doubt see redundancies and people potentially closing their doors.”
Johnson said everyone from international corporate companies to local banks have been cancelling events, with some choosing to keep it quiet so as not to attract negative press.
“This is having a massive impact on the industry. The way we see it, people are still getting on busses and trains to get to work – what’s the difference in going to an event?”
But Johnson doesn’t feel cancelling events is necessary; in fact, Johnson said her business would continue to hold its conference, and would just be advising attendees to carry out normal hygiene practices.
“I think everyone is just overreacting,” she said.
“We’ll tell delegates who feel sick to not turn up, or if they’ve travelled to any of the prone areas prior to not turn up. We’ll tell them to make sure they wash their hands and do all the hygiene practices, and just to be sensible about it.”
And while some conferences might be moved to dial-in webinars, that isn’t going to fix the problem.
“Hotels have had a 40 per cent drop in bookings, future events have been put on hold. The incentives market, particularly out of Asia, is non-existent, so they’ve all been cancelled there.”
“We’re talking thousands of people that aren’t coming to Australia now.”
And depending on the contracts these events businesses have with the venues, they may or may not be getting refunded.
“It’s around what’s in your contract, and whether or not you have travel insurance or whether you’re taking out insurances,” she said.
Small businesses take a hit
It isn’t just major events businesses losing out, with event hire businesses like Marcus Prentice’s Feel Good Events taking a hit.
“We’ve had a few clients in the last few weeks cancel their events due to the coronavirus,” Prentice told Yahoo Finance.
“One example was Telstra, who was going to run an event and had to cancel due to coronavirus, and a lot of universities as well,” he said.
“It is causing financial loss, and if it continues on like this, it could be a really tough year.”
And that financial loss equates to anywhere between $30,000 and $50,000, Prentice said, with refunds not an option.
“We get a deposit, so depending on the circumstance we just hang on to the deposit. But some had only been small deposits, and we lose what the rest of the job will be.”
Debbie Rivers runs events for singles, and believes the virus will definitely have a negative impact on her business.
“Single can be hard enough without having to worry about coronavirus,” Rivers told Yahoo Finance.
“There’s already the warning about handshakes, but what about kissing? Can you still go out in public places to meet or should you turn to virtual reality dating to stay safe?”
Ben Neumann runs a Melbourne events space, Ellora, and told Yahoo Finance he had seen three cancellations of events due to the virus, which has had a “huge impact” on the business.
“Only a couple of weeks ago I was saying this won't affect us as we are in events. How wrong I was,” Neumann said.
Jacob Aldridge is a keynote speaker and international business advisor. On Friday he learned his next two speaking events overseas had been cancelled.
“Ironically, I was due to be speaking on how businesses prepare for times of economic uncertainty,” Aldridge told Yahoo Finance.
And while the organisers are planning to have speakers deliver remotely or via recording for all their members, Aldridge said it won’t be the same.
“So much of the value in any conference happens in the hallway between sessions,” he said.
“While coronavirus will affect my business as a speaker, key conference content will still be shared. The much larger impact on organisations and industries is skipping a whole year of the relationship-building and serendipitous innovation that conferences create.”
Tourism events suffer
Sydney-based tour guide Judith Treanor told Yahoo Finance she had to suspend her tour to Vietnam amid the crisis.
“My co-host Kerry and I were due to take a group of women to Vietnam in March for our ‘Shop Eat Love Our Vietnam’ ethical shopping tour,” Treanor said.
“We were all set to confirm hotel bookings and details with our partners in Vietnam, but then the seriousness of the coronavirus spread across the world.”
“After some consideration Kerry and I decided to postpone the tour to September – but we can't wait to return and support the local businesses and the tourism industry in Vietnam. We know they are suffering terribly already in Vietnam, with approximately 30 per cent of their tourism cancelled.”
What’s more, Tourism and Transport Forum Australia estimates Australia’s tourism industry is set to lose as many as 133,200 jobs.
Kee Guan-Saw, the principal of accounting firm KST Partners in Melbourne, said some of the firm’s food and beverage clients have been getting staff to take annual leave during the crisis.
“We have clients in the food and beverage and tourism sectors that are already being impacted and while they are currently handling the situation...if this is a prolonged crisis, then the impact will become greater,” he said.
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