Bali has had its fair share of misfortune over the past
eight years but it has also shown its resilience and ability
to recover. I have written often enough in this column about
being prepared and having contingency plans for when things
go wrong. But when a crisis hits, such as the latest bombing,
our focus must be on damage limitation and how to get through
the crisis so we can prosper again. Other writers are better
qualified to handle the personal and psychological aspects
of a tragedy but here we must look at the more mundane but
important financial aspects.
Those most affected
The tourist industry as always takes the biggest hit. Hotel
cancellations, empty restaurants, deserted shops, - we have
seen it all before. But successful business people do not
give up. Special promotions, sales and special offers can
help to keep people coming in through the doors, cover overheads
and keep staff employed. Advantage can be taken of slack times
to carry out maintenance, refurbishment etc. Staff can be
asked to bring forward their holidays, menus can be temporarily
trimmed and so on. The personal touch becomes more important
than ever and strong leadership will help to sustain flagging
morale of employees. An owner or manager who pays extra attention
to his customers, even if there are fewer of them, will fare
better and recover faster than one who shuts up shop and waits
for better times to return.
Who else is affected?
It is hard to find anyone in Bali who is not affected in one
way or another. There is a knock-on effect on many businesses
not directly involved in tourism. Schools for example may
suffer from a reduction in pupils where their expatriate parents
lose their jobs and relocate elsewhere. The impact on those
remaining however can be countered to a degree by visibly
beefing up security to reassure parents, teachers and children
alike. Apart from that it should be seen that business is
as usual. One would have thought that exporters and freight
forwarders would not have been impacted but amazingly I have
heard of buyers cancelling orders because they think it is
unsafe to visit Bali. Producers and exporters may have to
look around for new customers but there is plenty of demand
overseas for products from Bali. It may take a bit of effort
and extra money for advertising and marketing but once new
outlets are found those nervous buyers may find supplies harder
to come by when they eventually return.
Yes, financial advisers are affected too!
Just about all service providers, including financial advisers,
are impacted to a degree. Few people want to consider a portfolio
investment or a new pension plan when customers have stopped
coming through the door. So, like other service providers,
we have to look for other sources of business, in my particular
case that means more effort in Jakarta and also on the Internet
dealing with remote ex-Indonesia clients now based in other
countries. But it does not mean abandoning Bali. On the contrary
it is even more important to be available and visible. I and
a colleague will still be spending a good part of each month
in Bali! Business is all about good times and bad times. The
challenge is how to manage both.
Getting the message to the outside world
A collective effort is necessary to convince the outside world
that it is business as usual. Foreign governments should be
asked to put the risk into perspective before they issue damaging
travel warnings. It is far safer to walk the streets of Bali
at night than those of say, Los Angeles or Houston. I know,
as I have walked all of them!
Colin Bloodworth is a senior adviser with Financial Partners
International. The opinions expressed are his own. If you
have any questions regarding personal finance you may contact
him at 021 520 8099 or colin.bloodworth@financial-partners.biz
