Decline in San Francisco tourism hits small businesses hardest

Maya Campbell, Arts and Culture Editor

The continual increase in visitors to San Francisco over the past 10 years has resulted in record-breaking growth in the city’s tourism. However, COVID-19 has brought the tourism industry down on its knees, taking many local businesses dependent on tourists with it.

According to a press release from San Francisco Travel published on August 22, 2020, the number of total visitors to San Francisco this year is expected to be 12.9 million, a 53.1% decrease from 2019, with a significant drop in international travelers from Europe and China. San Francisco tourism is estimated to bring a total income of $3.1 billion in 2020, 32.3% down from last year’s revenue. According to President and CEO of San Francisco Travel Joe D’Alessandro, “research suggests that recovery to pre-COVID-19 levels could take until 2025.”

“Our operations have been scaled back to a seven-hour workday and operating at 25% capacity,” said Vice President of Guest Experiences at The Aquarium of the Bay, Paul Nakamoto, in an email interview with the Urban Legend. The slow foot traffic and the limited capacity of visitors, enforced by city regulations, have led businesses to adjust their hours and staffing. With 24,000 animals to take care of and feed, the aquarium reduced its staff by 60%. “[It] is a human sacrifice that neither a business or the employees enjoy,” said Nakamoto.

In March 2020, non-essential businesses were forced to close their stores and wait for city approval to reopen safely. After closing their retail location selling handcrafted kimonos and wellness items on Grant Avenue in Chinatown, KIM + ONO was able to open its doors to the public with additional safety protocols in June. “We do daily temperature checks for all staff and sanitize our office and retail spaces frequently,” said Tiffany Tam, co-founder of KIM + ONO. “Everyone is required to wear face masks and social distance…we have hand sanitizers available throughout the store, have contactless payment checkout…and steam all clothes that have been tried on.”

Several business owners have reached out to the government for financial support during the pandemic. Anna Jew-Lee, owner and operator of Mister Jiu’s, a Michelin star restaurant in the heart of Chinatown, said her restaurant’s revenue is down by 75%. Jew-Lee was granted the Paycheck Protection Program (PPP) loan. “Without it, we would have had to close or scale down to almost nothing,” Jew-Lee said.

Founder of Dylan’s Tours, a company that provides minibus and electric bicycle tours, David Dylan said that 99% of his revenue comes from tourists. “We are 90% down from last year…all of our bookings are last minute, [and] mostly Americans,” he said. While Dylan has received financial assistance from the government, he believes it is not enough.

While these small businesses have slowly increased their capacity and therefore their revenue throughout 2020, Betty Louie, advisor of the Chinatown Merchants Association, believes the city could still provide more assistance. “City Hall, itself, needs to make sure that they are more business-friendly in terms of regulations they impose upon businesses in order to open,” Louie said. “I, myself, really don’t think that our country or the world will recover from this pandemic until probably late sometime next year…I would assume that we’d have at least a 30 to 35%, if not more, vacancy rate [in Chinatown].”

“They [Pier 39] need to help me on the second level as well,” said the owner of Solve It! Think Out of the Box, Yelena Martynenko. Before COVID-19, 70% of her sales came from international travelers and visitors outside the state. Located on the second level of Pier 39 means that her store is somewhat off the beaten track of tourists wandering around the pier. Martynenko feels that Pier 39 should further promote her business and help advertise all the stores on the pier, not just the shops on the main drag.

With the uncertainty of when business and sales will return to normal, business owners have had to be inventive and creative to keep their businesses afloat. “A big part of what we do is provide ambiance, service, and plated dishes,” said Jew-Lee. “For most of the last six months…we rode [the] waves of people wanting to cook at home.” Mister Jiu’s partnered with Lord Stanley and began creating five-course meal kits open for purchase alongside offering prepared foods such as dumplings, sauces and wine online.

In addition to retail locations, some businesses have shifted their focus and utilized the online space to their advantage. “I immersed myself into the marketing role to plan out campaigns that would align with today’s climate,” said Tam. “We’re donating a portion of our sales to small businesses helping our frontline workers and community during the pandemic.”

“Because tourism is such a big part of San Francisco, [the] small business industry, they [Chamber of Commerce] have to do a huge PR push to get people to come back to San Francisco,” said Louie.

Despite all of the repercussions of the pandemic, COVID-19 has allowed the staff of many small businesses to connect and has given employees and owners a new perception of strength and perseverance. Louie said, “you have to be able to adapt…if you have the attitude that nothing will change…store owners, themselves, would be their own worst enemies.”