News Column

Jersey Shore Businesses Prepare for Summer Throngs

May 24, 2012

Michael L. Diamond

For three years, Laurie Carloni, the owner of the Evergreen Inn in Spring Lake Heights, heard reports that the economy was on the mend, only to turn around and see her hopes dashed.

She was bracing for more of the same this summer, but she recently looked at her books and was astounded to learn that business has more than doubled since last year, she said.

"The economy is coming back," she said. "If you want to be glass half-empty, it's half of where I was in 2006. But it's more than double what it was in 2011. My expectations (for this summer) are fabulous."

The Shore's tourism season gets under way this weekend with an optimism not heard in several years. The job market has improved and gasoline prices have moderated -- both of which should give visitors more money to spend here.

Meanwhile, the Shore's business owners sound like they have cracked a secret formula, figuring out how to prosper in a new world where visitors are stingy and word of mouth travels fast. The economy isn't strong enough yet to help all boats -- in this case, literally. But some owners are considering how to expand instead of merely survive.

"The economy is maybe a little bit better, but it's not so strong that people are rushing to go all over the world," said Joel Naroff, an economist who follows New Jersey closely. "This summer might be setting up for a pretty good tourism season."

There is a lot at stake. The tourism industry generated $37 billion in New Jersey last year, 7.1 percent more than in 2010, according to a study by Tourism Economics Inc.

Pieces that would help the region exceed that mark have fallen into place. The U.S. unemployment rate has fallen from 9 percent in April 2010 to 8.1 percent last month. And New Jersey's average gasoline prices, once thought headed for $4 a gallon, are less than they were this time last year, according to AAA.

Some business owners have noticed the difference. Shorevacations.com, a website for summer rentals, has seen traffic increase by 15 percent over a year ago, said Chris Fotache, founder of Jersey Media Network, which operates the site.

And some owners who are renting their homes said they are filling up sooner -- with fewer discounts. Stephen Hyduke of Delaware Township, Hunterdon County, owns a house in Point Pleasant Beach. Faced with tentative demand this time last year, he began lowering his rate.

This year, he is already booked through Labor Day. "Everything sold earlier," he said.

The Shore's tourism industry has been waiting for a rebound since the economic collapse that began in 2008. It was so devastating that Americans' net worth has been reduced to 1995 levels, according to Patrick J. O'Keefe, director of economic research with J.H. Cohn, an accounting firm in Roseland.

While consumers skimped, saved and paid off their debt, business owners searched for a new formula that would allow them to at least make a profit.

They seem to have settled on this: Offer value and spread the word through social networks. Carloni, for example, attributed some of her success at the Evergreen Inn to promotions. She offered 25 percent off massages in April.

"My bookings went crazy," she said. "I kind of think if you lower your rate, they won't (ever) pay your full rate. I'll add value to the room."

It's a sign that the economy remains a work in progress. Jenkinson's in Point Pleasant Beach is offering an online promotion called Boardwalk Bounce, giving visitors access to its aquarium, beach, miniature golf course and rides for $42 for adults and $33 for children 11 and under, spokeswoman Marilou Halvorsen said.

Still, Halvorsen said she was worried; Point Pleasant Beach recently approved an ordinance to move up bars' last call from 2 a.m. to midnight beginning July 1, and she fears it will cut into attendance.

Businesses that depend on consumers with lots of discretionary income also could be in for a tough time.

Take the charter fishing industry, for example. Lindsay Fuller, the owner of June Bug Sportfishing in Beach Haven and president of the Beach Haven Charter Fishing Association, broke it down this way: He charges about $865 for an 8-hour trip, or about $144 per person. He burns 120 gallons of diesel fuel, which, at its current price of $3.90 a gallon, is $468. Throw in money for insurance, bait, maintenance and employees and he has little left over.

With the number of bookings on the same pace as last year's low level, Fuller is looking at another disappointing summer.

There are few expenses to cut; it's not as if he can use less fuel. "You've got to go where the fish are," Fuller said.

And then there are unexpected hurdles that have managed to trip up consumer confidence the past couple of years: the Gulf oil spill, federal budget showdowns and Hurricane Irene, to name a few.

Yet, the Shore's tourism industry absorbed all of that. And it is ready to try again, this time with a new strategy to offer value and build a buzz.

Chris Brandl owns Brandl's and Jake's Crab Shack in Belmar, and he has had a front-row seat to the economy. For him, the downturn began in 2007. So he came up with deals that helped him get through the leanest of times. And then he turned to the Internet, launching his own YouTube channel with demonstrations that include how to pan-sear grouper over purple sticky rice.

Sitting at Jake's Crab Shack on the Belmar boardwalk one day last week, he said consumers remain cautious. But if all goes well, he can envision opening Jake's throughout the Shore, perhaps beginning next year.

"I think we're coming out of the hole we were in," Brandl said.



Source: (c)2012 the Asbury Park Press (Neptune, N.J.)