May 13, 2021

cruciforme

travel, Always a step ahead

A tale of two economies: Some businesses thrived during the pandemic | Local

5 min read

When it comes to the economic impact of the coronavirus pandemic, it was clearly a tale of two economies.

Business such as hotels, theaters, restaurants, bars and entertainment venues that are dependent on care-free travel or the ability of people to gather in groups were clearly hit hard by the shutdown and then the restrictions that were imposed because of the pandemic.

But those same restrictions ultimately favored other businesses that deliver food and goods, provide outdoor recreational opportunities or offer services aimed at improving or expanding living space.

Many of those companies actually expanded during the pandemic while many of those with close ties to the hospitality industry struggled to survive the loss of business.

Personal space

Realtors and home-improvement contractors reported a surge in demand as people realized they didn’t have sufficient living space or wanted to make improvements to their surroundings during the pandemic.

“With kids at home and people working remotely, there was high demand for everything from home offices to additions,” said Beau Dunfee, managing broker with South Bend-based Weichert Realtors — Jim Dunfee & Associates.

“But others decided it was time for a different home — one with more room or more yard,” Dunfee continued. And that — along with continuing low mortgage interest rates — has fueled continued demand in the housing market.

Thanks to the use of technology that allows for nearly contactless transactions, real estate was able to move on unabated throughout much of the pandemic, according to Realtors.

But the increasing demand caused by the pandemic served to highlight the biggest problem in the housing market the past several years — a severe lack of inventory caused by a thin supply of both new and existing homes.

“The imbalance between supply and demand became even more pronounced,” said Dunfee, adding that the inventory of homes on the market in February dipped below a one-month supply.

Outdoor activities

While some people were focused on improving or expanding their personal space, others looked for ways to escape their homes amid the pandemic, especially since travel and so many other activities were restricted or curtailed.

Both the RV Industry Association and the National Marine Manufacturers Association reported near-record shipments and sales in 2020, even though many factories in the Elkhart County area that produce RVs and pontoon boats were shut down for several weeks at the start of the pandemic.

The RV trade group reported that shipments in 2020 reached 430,412 units, a 6% gain compared to 2019, and are on course to reach a record level of between 523,139 and 543,572 units, according to the latest projections.

Similarly, the Marine Manufacturers reported that 310,000 new powerboats were sold in 2020, a level that hasn’t been seen since before the Great Recession, and sales are expected to remain at historic levels as manufacturers continue to fill a backlog of orders.

“When you change the behavior patterns of an entire nation, it affects all businesses differently,” said Jeff Haradine, vice president of sales for Barletta Boat Co. In Bristol. “Maybe you couldn’t do travel sports, Disney or some other family vacation.

“We were a very Covid-safe activity for families,” he said, adding that the company’s orders from dealers are filled into 2022, even with the recent completion of a new 144,600-square-foot plant.

The same is true for most RV manufacturers and suppliers with shipments in 2021 already off to a break-neck pace. “There’s been a long-term trend favoring RVs as a way for people to enjoy the outdoors,” said Monika Geraci, director of public relations and communications for the RV trade group.

The pandemic boosted that trend as people looked for ways to travel in a controlled environment while others learned they could work remotely or even have their kids participate in e-learning while parked in a campground, Geraci said.

The rapid rebound in both industries is reflected in the unemployment figures for Elklhart County, which hit a staggering 28.6% in April 2020 but had dropped to 4.7% by January.

While both those industries benefited from the restrictions caused by the pandemic, golf courses also experienced a resurgence in interest here and across the nation, said Tony Stearns, director of golf operations for South Bend.

Though the city has put considerable money and effort into revamping the city’s three public courses — Erskine, Elbel and Studebaker — the changes certainly wouldn’t have been noticed as quickly if people weren’t looking for activities that were safe to do during the pandemic.

The improvements as well as the pandemic drove business at the city’s courses.

“Even though we were shut down for 50 days, we still had a 30% gain in the number of rounds,” said Stearns. “It was the first profitable year we’ve had in quite some time.”

And it appears as if the renewed interest in the sport won’t be dissipating anytime soon as 2021 season pass sales are at an all-time high, said Stearns.

Delivery and to-go

As people were looking to minimize exposure to the virus, restaurants and retailers quickly pivoted to curbside pickup and delivery services, and some locally owned shops felt the need to create or expand their online presence as a way to reach customers during the pandemic.

Many of those stores and restaurant owners don’t see those changes going away, even when concerns about the pandemic start to subside. After all, they know the trend favoring convenience was only enhanced by the pandemic.

And that’s been seen in the distribution centers that have been built on the northwest side of South Bend since Amazon opened a delivery center in a shared 210,000-square-foot space in 2019.

Since then, builders have raised at least three more distribution centers, totaling more than 600,000 square feet, and more are on the way, as e-commerce continues to expand and some businesses opted to bring critical supplies closer to home because of disruptions caused by the coronavirus.

Even as things start returning to normal, those delivery vehicles will still be dropping off products, groceries and prepared meals.

“The landscape has changed and it will never go back to what it was before,” said Jeff Leslie, president of Hacienda Mexican Restaurants. “Our carryout had been increasing for five years, and with Covid, it took a huge leap forward.”

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