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Summertime Could Mean Hard Times for Merchants

Even though there will be an increase in cruise ship calls this summer, local merchants are still worried about a loss in profits and possibly the downsizing of employees, while others in the business community are talking about ways to enhance the territory’s tourism product.

Overall, the territory is expected to see a 1-percent increase in passenger arrivals from May to September, with 141 calls instead of the 136 seen at this time last year. Realistically, however, there are multiple instances in the schedule when no ships are in port three to four days during the week, which has merchants worried that they won’t be able to sustain their businesses.

Officials have explained that some of the ships are being repositioned to locales such as Europe and Alaska, which has meant that the cruise lines are "redistributing" locally — meaning that there might be three or four ships in port during Monday, Tuesday and Wednesday, and none from Thursday to Sunday, depending on the week. The Emerald Princess, for example, will be gone from its regular Thursday call at Crown Bay, while the Serenade of the Seas, which used to call at Havensight on Saturdays, will be rotated to Monday, according to West Indian Co. Ltd (WICO) President Edward Thomas Sr.

Officials have said the redistribution is a seasonal occurrence, while the merchants contend it’s worse than before. One of the biggest concerns, many said, is that the more than 65,000 extra passengers expected to come in during the summer months will, because of the dip in the economy, have less disposable income than customers that come during peak season.

"It’s different than the passengers we’re used to seeing," said Patrick McGlone, manager of Jewels in Havensight. "It doesn’t necessarily mean that more ships means more money. During the summer, Carnival and other lines sell weeklong vacations for $199, just trying to get people on board. So the passengers, when they come here, are not taking island tours, not eating in restaurants, not buying jewelry and watches — sometimes they even carry sacked lunches off the ships because they don’t want to spend the money buying lunch."

While McGlone said the company doesn’t have plans for layoffs at this point, it is trying to partner up with some of the hotels and offer a free shuttle service so guests can come down to Havensight on the off days.

A few stores down, business owner Erjun Chandiramani said his store will be harder hit.

"There is no way we can break even, cover the costs or make enough money to pay the rent," he said. "Because not all customers want to come here, and with all the other stores downtown as well, there is not enough business for all of us to survive with the ships in for two days."

Chandiramani’s brother Raju said the Havensight merchants are at more of a disadvantage because on some of the days ships are in port on St. Thomas, they are scheduled to call only at Crown Bay, leaving Havensight bare for five days in a row.

"We need more ships, enough ships at this dock to sustain the area," he said. "Because it’s not just Havensight we’re talking about, it’s also Port of Sale, Yacht Haven — all these businesses that depend on the cruise ships that dock. So it’s a bigger issue. It’s not just as simple as asking what my plan of action is for the summer."

Raju Chandiramani said the situation will be better when the governor’s plans to have WICO and the V.I. Port Authority join forces become a reality, because then there will not be any dispute over where the ships are going to go — instead, the entities will be acting as one unit.

Chandiramani, who said one of the biggest frustrations the merchants face is a lack of communication from the ports, is hopeful that officials will begin to give the merchants more advance notice.

While the Havensight merchants talked about possibly offering the cruise lines more of an incentive — such as lower per-passenger fees — to come in during the off season, local business leaders, such as St. Thomas-St. John Chamber of Commerce President Richard Berry, spoke about enhancing the onshore experience for passengers so the demand for cruise ships to return is higher.

"It’s a bigger-picture thing," Berry said. "We’re competing on a global basis now for our tourism product. The world has become a lot smaller, and the Virgin Islands needs to recognize the fact that people are not only regionally becoming more competitive, but globally more competitive, and this summer’s the perfect example of that with the major cruise ship lines repositioning their ships to the Mediterranean and other destinations."

Berry said it is true that the territory has historically had a "smattering" of cruise ships on given days during the off season, but from now on should be seen as a "wake-up call" for the territory to look at its product.

Berry spoke about getting water transportation up and running to alleviate some of the local traffic issues, diversifying the shops and increasing the number of activities available to visitors. Even making sure tourists are treated nicely when they go out on tours will go a long way, he said.

"We need to take advantage of the days that the passengers are here to make the most out of their visits and give our guests the best time possible so they can return as visitors," he said. "If we’re not careful as a territory, a business community and a government to make sure our destination stays viable, stays current, then our numbers could decline."

Berry said it may be too late to do something about the schedule this season, but looking at how the contracts are negotiated with the cruise lines is something the government should be aware of in the future.

"We want to maintain being a top destination, and grow, not maintain the status quo," he said. "And while we have a good product, a fantastic product, we have to look at ways to expand and make it better."

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