Hagley Park business operators reel from losses

Staff reporter

Sunday, March 24, 2019

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Business owners in the Three Miles/Hagley Park area believe that the road improvement programme in their zone might have come at too high a price.

This follows the fanfare over Prime Minister Andrew Holness' announcement that the major infrastructure development programme (MDIP) is near completion, after being mired in months of inconvenience.

It is high enough to pose an existential threat to some businesses, as is the case with operators of the Rubis service station on Hagley Park Road, and the Texaco service station at Three Miles — now Portia Simpson Miller Square — who told the Jamaica Observer, during a canvas last week, that they had lost 60 per cent and 80 per cent of their businesses, respectively.

During his contribution to the parliamentary budget debate last week, Leader of the Opposition Dr Peter Phillips raised the question of Government liability for the losses incurred by businesses affected by the road-works. Already, some operators reported that they have started the process of claiming for their losses.

Business owner of the Rubis gas station, Delroy Collins reasoned that although the new roadway will be for the public good, the losses that his business has so far incurred will be hard to recover.

“The gas station has slowed down and there is now a serious threat to our business. But it is important for us to say that we know that there is a price to pay for progress, and we appreciate that at the end of it, it will be for the common good. But at the same time, for us to be taking such a hit on our business, it is now posing an existential threat to our survival”, said Collins.

Manager of the gas station, Andrew Pixley reported that as at the end of February the business might very well be in its last throes, having lost millions already.

“That equates to $1.8 million every month. We used to do about 300,000 litres of petrol a month. As at the end of February, we are at 146,000 litres. On the gas side alone, I have $1.45 million in losses [per month]. But on average, it's about $1.8 million losses a month.

“Any other additives or additional services that we would offer to the customers, those are completely down — and they haven't even reached up to here fully. When they come closer to doing this side, sale is going to drop even more.

“Currently we are out of 87 and 90 [petrol] and it's as a result of the roadwork, because the trucks can't come in here. Right now I am expecting a delivery and I have to be calling and telling them to come with smaller trucks,” Pixley said.

Over the period, Pixley estimated that the business has lost between $7-8 million, money which he said he does not expect to get back. As for staff, Pixley said they have had to make some adjustments.

“We had to let go of about three members of our staff, although we don't generally like to do that. So what we did was have meetings with the staff and they agreed to cut their hours so as to keep their positions. But at this rate, the cutting of hours is not going to help the situation.

“Although we knew that work would be happening, we didn't expect it to impact us this much. Put it this way, if nothing changes in the next month or two, we will be completely out of business. We are almost one month away from bankruptcy, not even a full month. We are talking about sleepless nights, that's how bad it is”, said Pixley

Things, however, appear to be much worse for the Texaco gas station where Branch Supervisor Lenroy Findlay reported that they also had to lay off members of staff.

“Business is down about 80 per cent right now because we have the blockage on both sides, left and right. Is only the credit customers that we have that is keeping the business alive for right now. If it was the cash alone, we couldn't survive.

“We had to lay off two staff members because we couldn't keep up with the losses. We only hoping that when the road is finished, we will make it back. But we have lost a lot of business since this start,” said Findlay.

Several business operators also reported that they have been seeing significantly fewer customers because of the road-work. Some explained that since last October, their land-lines and Internet have been down, and water also has been scarce.

“Phones are out, the swipe machines are out. Water not so bad, but that go and come. I think everybody here is up against it. Overall, it's terrible,” said a representative from Electro Welder Supplied Ltd.

Owner of McLean Customs Broker, Leon McLean said he only recently got back his Internet which, during its absence led to an increase in storage cost for his clients.

“From October we don't have any landline and only recently we got back the internet so it has been a real challenge for us. When the Internet, is down it affected us, because the custom entries that we have to make, we can't do anything without the Internet — and it was gone for about three months. That results in the goods staying longer on the wharf, leading to more storage charges for the time. So we have to find other alternatives for Internet service”, said McLean.

Meanwhile, several car dealerships on Hagley Park Road, including Genesis Motors, Hyundai and Honda, have been especially impacted by the work, what with the dust and little or no water to clean vehicles.

Branch manager for Genesis Motors, Harold Thomas told the Sunday Observer that the roadwork has been “very costly for business.

“We can't even display cars at the front anymore because of the dust, and we cannot wash as fast, as the dust is raining down on the vehicles. We have to be using so much more water now to wash the vehicles, and we have to use more man-power and, even then, we just can't manage.

“We have no water in the pipe, so we have to be buying water. I bought some water yesterday and that was about $24,000. Eight days ago, we bought some water that was $15,000. So it is becoming extremely costly.

Managing director of Supreme Motors and Superior Parts Ltd, Derrick Johnson said his Honda dealership has incurred millions in losses.

“There is a reduction in customer and sales. Connectivity has been at zero. Flow lines have been out; and there's no Internet, no phone lines. Flow was our main partnership and we have to now use Digicel. They have cut off water. Sometimes we have power cuts as well.

“There's a lot of dust, people have to be going to the doctor. We have to invest in face masks to keep off some of the dust. All I can say is that the loss is huge...a huge loss in the millions because we have fewer customers coming in — because sometimes you'll see the roads blocked, then they'll be open, and within 20 minutes, they're blocked again.

“We try not to lay off people, but we have to just scale down as much as possible and allow people to take their leave,” said Johnson.

Johnson further said that his company was in the process of finalising the estimates to submit a claim to the Government for compensation for losses.

Businesses located at O'Neil's Place, including the popular karaoke bar and lounge, which has not been able to host events for at least a month now, have also seen losses.

Dwight Ferguson, manager of the popular spot, reported that he has had to refund money to persons who booked the facility because of the road condition.

“We were trying with it but mi just get fed up because we had to start give people water for the club to keep. People who book the club for events, we have to refund their money because it nuh make nuh sense with the state of the road, because them nah guh make nuh money. We even have to be turning down bookings because mi nuh sure about the road, because every minute them dig up back the road, so it doesn't make any sense”, said Ferguson.

An employee at Goonz Auto reported that “since October, we haven't had any water or Internet. Many persons have not been coming again because of the road, so we are definitely seeing fewer customers.

“We see less of our main customers so it has impacted our business, but not to a critical point. Most of our top customers no longer come in; they basically tell us they are not coming until the road done. Also, we have to be carrying water to work. The phone and Wi-Fi is also a problem.”

“The Government could at least give us the GCT, because we still have to maintain our overhead just the same. It's amazing how some of us still can do that,” said an employee of PMR Cogent.

Registered pharmacist and owner of Health Smart Pharmacy, Ricardo Debee reported that he recently relocated to Kingston, hoping to attract more business.

“When I moved here in May last year the property owner did tell us that some work was going to start, but did not tell us when. So when we start we expected business to be low. But things really started to get worse around September. As soon as they start the roadwork, customers just stop coming. The sales reps don't want to come and the delivery persons don't want to come here.

“I don't have any phone service from FLOW since November, and Digicel Internet service goes and comes. But each transaction that we have we need to use either land phone or Internet service to process the insurances, credit card machines. We need communication.

“When we just came here, we had to remodel the whole place, and I don't think we have recovered any of that money yet. This was a relocation. We used to be in Manchester and we came to Kingston hoping things would have been better, and look at it.

“I have to hire bikers to deliver goods to customers on demand, at my cost, just to keep business afloat, because they are not coming here. And I have to be paying utilities same way. This month, we had to go into personal savings that had nothing to do with business to help to pay the bills,” said Debee.

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