The great ski-season rescue

Iwas lucky enough to spend last weekend up in Ohakune. An old mate had turned 65 and he invited an eclectic group of people together for a Germanic Alpine-themed dinner.

I’ve always liked the volcanic plateau surrounding Mt Ruapehu.

The maunga stands both protective and threatening, and the landscape is rich in colours and textures. Orange lichens sit uneasily on red rocks, hardy tussocks manage to get footholds in sheet rock and Tongariro’s Unesco Dual World Heritage status anchors the lot.

I also like the nature of recreationbased alpine villages like Ohakune, National Park and Tu¯ rangi. They are cheeky, charming and friendly, a lot like the workforce who rent the skis, flip the burgers and make the beds of the skiers and sightseers who frequent the area.

It was noteworthy to me that there were skiers there at all. After 10 weeks of Auckland lockdown and an alternating lockdown in the Waikato, I was pleased to see the loaded Legacies, Prados and Ivecos heading up to Whakapapa and Tu¯ roa in the mornings and returning at night.

For large-scale tourism operations like the ski-fields, Covid-19 has been the nightmare that never ends. But the way that companies such as Ruapehu Alpine Lifts (RAL), which operates Tu¯ roa and Whakapapa, have responded provides a pretty insightful lesson into how other businesses might want to tackle the problem.

And for the ski-fields it’s not just a customer problem. It’s a workforce problem.

Have you ever noticed that half the staff working ski mountains are foreigners, be they Canadians, Americans or French? That’s because Kiwis often don’t have the skills or the desire. So ski-fields rely on the supply of foreign workers via Immigration NZ.

From February last year that supply has dried up. Closed borders and a halt on visas robbed the fields of half of their workers. But this is also a problem operators such as RAL are desperately trying to solve through local employment programmes in conjunction with a raft of local stakeholders.

Then there’s the customer angle. Or rather, the lack of them. A ski-field operator like RAL is licensed to carry 5500 people on each of its two ski-fields. The ability to reach that figure depends on great weather, great snow and successful marketing.

But before that, it depends on being able to have skiers able to go skiing in the first place. For the past 10 weeks, 40 to 50 per cent of those skiers have been chained to their homes and their region. And many more have had severely depleted discretionary income to be able to afford skiing.

But despite this, RAL has managed to not just keep the maunga operating, but average 2000 to 2500 skiers per field per day on weekends. Which is a bit astounding, really. So how did they manage to do it?

First, putting people first. The company recognised that its people were paramount and should be the first thing they thought about in the morning and the last thing they thought about before turning in for the night. In a time of crisis, without a team who trust you and good people leading the core parts of your business, you don’t have a business.

Secondly, recognising that ongoing working capital is the necessary requirement for operational success every day, every week, every month. Many tourism businesses have been exposed by not having either the cashflow or the ready access to new working capital to ensure they could make their payroll and supplier payments.

RAL put cashflow forecasting front and centre and simultaneously ran ‘‘best guess’’, ‘‘optimistic’’ and ‘‘pessimistic’’ scenarios. Like Jack Reacher, RAL hoped for the best but planned for the worst.

Third, realising that scaling a business to meet a very different demand than usual is tough. In the ski-fields’ case, this meant restrictions around visitation and adapting indoor venues to meet alert level 2 demands.

It also meant developing Covid operating protocols in conjunction with the Ski Areas Association. The protocols effectively gave RAL the operating tool to ensure the safety of their guests and staff on the maunga.

Fourth, quick-fire customer innovation. This included standing up an online bookable parking system within six weeks. It also involved a ‘‘back to the future’’ move of setting up a real-person contact call centre for customers with questions. And there have been a lot of questions.

In the case of RAL, this involved finding space in Taupo¯ and housing a call centre to manage customer queries, bookings and the numerous alert-related questions.

Fifthly, talking to stakeholders. Often. RAL’s bankers, bondholders, the Department of Conservation, local councils and iwi all proved accepting of the challenges and generous of their time; but this is because the company was active in communicating and was dead straight about the hard bits.

Lastly, acknowledging that government support is critical when your margins are thin. Without the Government being tethered to RAL, through the Provincial Growth Fund long-term suspensory loan, DOC Concession fee relief and the wage subsidies, the path through the Covid crisis would have been a hell of a lot harder.

Talking to RAL chief executive Jono Dean last week about these challenges, I asked what kept him going each week. He replied with a quote from Winston Churchill: ‘‘If you’re going through hell, for God’s sake keep going’’.

Good advice, I reckon.

As Winston Churchill said, ‘‘If you’re going through hell, for God’s sake keep going’’.