The London businesses the Olympics forgot
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Packed stands, spectacular fireworks displays, performances by superstars and deafening roars of applause. This day last year, London was in full party mode at the closing ceremony of the London 2012 Olympic Games.
But not too far off from the Olympic stadium, some Londoners were in no mood to party. The Games had meant game over for their businesses.
These businesses didnโt see any of the 14,000 athletes, 21,000 media, and around 800,000 spectators, that the Olympics brought to London visit their shops. The result? Some firms closed, some saw a 30-70% drop in turnover while others racked up huge debts. To top that, parking restrictions by local councils and โBerlin Wall-likeโ barricades in some areas, shooed off their regular customers.
Earlier this month, we saw government officials shouting from the rooftops about the ยฃ9.9bn boost the Olympics brought the UK economy – including a ยฃ4bn windfall for the London economy. The figures were met with criticism, with some analysts saying that the investment would have taken place anyway and other saying small businesses lost out.
Mike Cherry, national policy chairman of the Federation of Small Businesses, has doubts over what โthe true economic legacy is for micro and small businessesโ.
โOut in the regions we found that the effect of the Olympic and Paralympics for small businesses didnโt materialise as much as had been hoped. Some businesses certainly did benefit from the Games with really good contracts, but for others it just didnโt happen,โ he says.
We donโt mean to be killjoys. In fact, regular readers of LondonlovesBusiness.com would vouch for the fact that weโve time and again celebrated the success of the Olympics and what a great advertising campaign it has been for London. However, we feel itโs important to highlight the plight of businesses that didnโt exactly strike gold at London 2012.
Paul Cunningham, owner, Biscuit Ceramic cafรฉ โ โThe Games were like an apocalypse for usโ
Location: Greenwich Market
Olympic effect: 70% drop in turnover
โThe Olympics nearly killed my business, my turnover dropped by 70%. The Berlin Wall-like barricades put in Greenwich Market to guide visitors to Greenwich Park, where the Olympic and Paralympic equestrian events were held, meant that neither the tourists nor our regular customers could reach the shops.
โWe were so excited about the Olympics and had planned staff hours and new products in advance but it was heart-breaking to sit in the shop the whole day with no customers dropping in.
โAlso, I donโt recognise the ยฃ9.9bn Olympic boost that the government has been celebrating. I have doubts over the integrity of the calculation; it doesnโt chime with anything that is appropriate for my business. It was like an apocalypse for us.โ
Dragana Perisic, owner, designer boutique Dragana Perisic Shop: ย โI had to wind up my business, thanks to the Olympicsโ
Location: Cheshire Street, near Brick Lane
Olympic effect: Business shutdown
โThe Olympics was the worst period since I set up the shop seven years ago, it was an absolute disaster.
โPeople just didnโt come in and I think the media publishing stories about how busy London was going to be during the Olympics scared people from coming to the capital.
โNo doubt August isnโt the busiest month for businesses, but this was the worst ever. Just paying my shop rent became a big struggle.
โI lost a lot of money in July and August last year and it affected my cashflow so much that I had to shut down. How could I have gone on when my business was down more than 60%?
โIโve now started from scratch and opened a shop on Redchurch Street near Shoreditch.โ
Sudhir Patel, owner, Tanna Cards: โThe Games made us more losses than profitsโ
Location: Upton Park
Olympic effect: 30% drop in turnover
โMy shop is in the Upton Park area which is nowhere near the Olympic Park. Even then, I suffered a 30% drop in turnover that I havenโt been able to cover up for.
โI still have more than ยฃ1,000 worth of Olympic souvenirs lying in my warehouse – thatโs a very big amount for a shop owner like me. Nobody came to the shops and it was very upsetting.
โAlso, the council put parking restrictions in the area which discouraged our existing customers from coming in to the shops. This led to a change in customer habits which is affecting footfall even today.
โThe Olympics were meant to be about boosting London businesses but frankly, it made us more losses than profits.โ
Kate Hill-Smith, owner, Red Door Cafรฉ: โThe Games were a complete joke for businessesโ
Location: Greenwich
Olympic effect: 30% loss and debts
โWe were doing really well in the beginning of the summer and the run up to the Games but it all turned out to be a big joke for us by the end of it. The barricades prevented visitors from visiting the markets so not only did we not get any extra trade, our existing customers couldnโt get to us either.
โAlso, a month before the Games, Greenwich council threatened court action if we didnโt take our tables and chairs inside during the Games. This meant we couldnโt put any aid boards or signs outside our shops to advertise our businesses for a whole year.
โWhat was even more disappointing was that we later found that Greenwich Island is private property and is owned by Greenwich Hospital Estate. Itโs not owned by the council. So the enforcement was just about the biggest trick and con for the benefit of the Olympics.
โMy loss of earnings over the last year has gone into thousands of pounds, and thatโs not an exaggeration. I lost at least 30% for the two months and havenโt been able to recover since.
โWe were all expecting a bonanza and were left with a big hole in our pockets.โ
David Manchester, owner, Manchesterโs, The Flower Shop Greenwich: โGames were a no-go for businessesโ
Location: Greenwich
Olympic effect: None
โThe government wanted us to believe that the Games would be good for business. Well, they werenโt. We saw thousands of people coming to our area to see the Olympics but they didnโt bother coming to our shops.
โTo be honest, I wasnโt surprised. Iโve been in business for 42 years and I wasnโt expecting much. In fact, I was expecting all the hassle we got. We couldnโt get into the Oly
mpic lanes – the roads that were reserved for accredited Games vehicles – and most of our customers went on holiday.
โBecause we were mentally prepared that the period would be quiet, we didnโt bother getting extra stock.
โHaving said that, I think the Games were a no-go for any business that was looking to make money. No Olympic benefits were felt this side of town.โ
Isaac Lilos, co-owner, Arty Globe by Hartwig Braun: โWe have every reason to believe that if it werenโt for the Olympics we could have enjoyed a normal strong summerโ
Location: Greenwich
Olympic effect: 20-25% drop in turnover
โEvery business in our area was encouraged to stock up before the Games, as we were constantly told by the organisers what a fantastic opportunity it would be for businesses.
โIn the months before the Olympics, business was very flat due to a lack of regular overseas visitors to London and also Greenwich Park being mostly closed in preparation for the equestrian games.
โDuring the Olympics, we were busier but not enough to compensate for the lack of footfall before and after the event, so the whole year was down by around 20-25% compared to normal years. We have every reason to believe that if it werenโt for the Olympics we could have enjoyed a normal strong summer in terms of footfall and sales.
โBusiness certainly, and thankfully, has recovered since then and this summer it has gone back to normal. In terms of the Olympics legacy – it does not feel tremendously different to any other year of trading at Greenwich so we cannot immediately see how the Olympics made any lasting difference to trade & business one year on.โ
Fiona Bell Currie, owner, MyGorgeousCards.com: โOlympics werenโt thrilling for small shops or sole tradersโ
Location: Blackheath
Olympic effect: Stopped new ranges
โI am a sole trader specialising in designing products celebrating London inย my local area of Blackheath and Greenwich. Everything I sell retails at under ยฃ10.
โBelieving the promises about the Olympics being fantastic for small businesses, I reprinted my best ranges, brought out two new ranges of postcards andย had more of my popular coasters made. The shops were very interested and most took up my offers. Imagine my horror when I never heard from them again, not until they folded.
โIt appeared that in Greenwich and Blackheath shops were not allowed to open before 12 noon. Barriers were excessive and severely limited access to shops and the Greenwich Market.
โThough I stocked two shops close by the Greenwich railway station, they both folded, without a word. In Blackheath I lost two more outlets. The impact of the Games, on top of a recession, on top of shops having excessively high rates, spelt the end of my own developing ideas for the area.
โThe Olympics were thrilling and incredible in so many ways, but not for the small shops, nor the sole traders.โ
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