The end of the ride? Carnival operators left in limbo as COVID-19 keeps their businesses shut
Burning through their cash reserves and with no signs as to when they can reopen amid the COVID-19 pandemic, travelling carnival operators like Uncle Ringo are stuck in limbo.
SINGAPORE: A layer of dust covers the colourful machines parked inside an anonymous, nondescript yard, where pink and silver-coloured unicorns, boxy helicopters and gold-tinted pirate ships are set next to stacks of containers and trailers.
“It’s not usually this full,” Ms Joyce Lee said as she described the rides sitting at their storage site in Penjuru. The 36-year-old is the director of traveling carnival operator Uncle Ringo, which her father, Mr Lee Woon Chiang, 67, started 36 years ago.
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It’s a similar sight on the other side of town, in a corner of Punggol. Tarps covering lacquered trains and carousels and ‘life-sized’ dragons and dinosaurs with no one to scare are packed side-by-side, looking slightly weather-beaten.
This was the year Uncle Ringo was supposed to reinvent itself. Gone were the days of relying on pasar malams - a colloquial term for night bazaars - which have been a mainstay for the firm’s balance sheets since it started in 1984.
The permanent park at Punggol was just one of the many projects the company had to seem a bit more contemporary. There was going to be a ‘60s-themed replica of the Great World Amusement Park at Harbourfront, and a series of circus performances in the heartlands by a professional troupe from Europe, following a successful run at last year’s countdown party in Marina Bay.
All of those plans have been struck off the calendar. Travelling carnival operators like Uncle Ringo have been stuck in limbo since March, after COVID-19 halted most entertainment activities.
Frustrations and anguish have built up as operators have no idea when they will be allowed to restart business. And as the wait continues, financial losses pile up.
Ms Lee said they are burning through about S$100,000 a month. About half of it goes to warehousing costs, where their machines, rides and game booths are stored. The rest is for manpower, permits and licensing costs.
This is after about five people were laid off from the team of 24, while putting the rest on a three-day work week with a pay cut of around 40 per cent. The exceptions are the maintenance guys who are needed to keep the equipment in good shape, and work on requests from other operators to service their machines.
They are reluctant to let any more people go, Ms Lee said. For one, most of them have worked with her family for more than two decades.
“How do I tell my staff … that ‘sorry, I don’t think we’re going to continue, please go out’. They are 50 years old, 60 years old.”
Rehiring and retraining is also costly, and there is a risk of them never coming back, she added.
There is also debt to finance right now. Uncle Ringo took out a loan last year to purchase new equipment. The cost for each ride is usually in the tens or hundreds of thousands of dollars. And they have been looking at taking another loan to keep the business going.
“(But) it’s a liability that we will still need to pay off,” she said. “We will (have to) weigh it ourselves whether it’s worth it for us (to do so).”
Like the Lees, Mr Eddy Goh has also had to make painful decisions this year. The founder and managing director of J’Kids Amusement had to let go of about half of the company's 30 employees between March and July, while most of those that stayed have taken a 20 to 30 per cent pay cut.
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Losses this year have totalled about S$700,000 so far, he said, even after some logistics work he did for the Government in May and June, which brought in around S$35,000.
J’Kids Amusement has not had any events since the River Hongbao festival during Chinese New Year. The plan was to follow it with carnivals at the Singapore Expo and Gardens By The Bay, smaller fairs at shopping malls, and HDB roadshows. Its deal with the Peoples’ Association - running mobile movie screenings at different neighbourhoods every week under the Be My Kaki Movie Bus programme - had to end prematurely as well.
Mr Lee questioned why places like Universal Studios Singapore and indoor playgrounds are allowed to open but not them, but added that they have not reached out to any Government agencies for help as they are unsure which ones to approach. There is also no carnival operators association to lobby on their behalf, he added.
Mr Goh said he tried to ask when operations could resume through the GoBusiness hotline, but was only told that they are still cannot open, without any definite timelines. He said he understands why officials are being cautious, but that has not stopped him from being worried. News of closures from the likes of Robinsons and SuperPark has left him even more jittery.
In a statement, the Ministry of Trade and Industry told CNA that its “key priority is to minimise the risk of transmission of COVID-19 and ensure that businesses provide a safe environment for their customers and workers”.
“Hence, we are taking a cautious approach for businesses where large numbers of people are likely to come into close contact for prolonged periods of time.”
It added that companies not allowed to resume operations are in the highest tier of support under the Jobs Support Scheme, where wages are subsidised by 75 per cent.
But both carnival operators said their business licenses leave them eligible for only 25 per cent of wage subsidies under the Jobs Support Scheme, rather than 75 per cent. Ms Lee said she has submitted an appeal for more support.
Smaller players have not been spared either. Carnival World’s director Rey Chua laid off his team of three in April, but tried to help them secure part-time gigs and hopes to rehire them when the situation improves. He and several others are now working as Safe Distancing Ambassadors.
Before the pandemic, the five-year-old company had been expanding its number of corporate clients, said Mr Chua, 31, organising fun fairs and loaning out party supplies like inflatable castles. In January this year, Carnival World moved into a bigger warehouse after purchasing more props and machines. Then the event cancellations began in February.
So far, bookings have been far and few between. Apart from the odd family renting an inflatable bouncy house, the only significant project he got was for Children’s Day, when he provides game booths to three schools. These raked in S$7,000, a fraction of the S$50,000 he has spent to keep the business going.
When the cancellations first began, Mr Goh thought he would be able to weather through it. He had gone through the SARS crisis, and activities had resumed within four months then. The present crisis has halted business for almost twice that period so far.
Both he and the Lees are still holding out for some sort of turnaround in December - in time to catch the holiday crowd - although they are not optimistic. And with the ongoing recession curbing consumer spending, Ms Lee said she is not sure how much money they can make even if they are allowed to resume operations.
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The announcement would also need to come soon. She pointed out that it takes them at least three weeks to prepare for an event, as there are machines to check, employees to brief, and now, safe management measures to implement.
But for now, without any indications when they will be allowed to run, none of the carnival operators have any clue how to plan for 2021.
“It’s mentally draining … I’m trying not to think about it,” Mr Chua said.
PIVOTING HAS ITS LIMITS
There are also limits to what can be done to reinvent the business.
For instance, going online - which is how some businesses have reached out to their customers during the pandemic - is nearly impossible for an industry that is about selling thrills and experiences, they said.
“Our focus is having the family down together, bonding,” Ms Lee said. She thinks running mobile games is akin to gambling - not an activity they want to encourage.
Mr Goh’s firm, on the other hand, is coming up with a mobile game app that lets players accumulate points they can redeem for physical prizes, which will be sent to their doorsteps.
It will launch by December, he said, but even this cannot replace the atmosphere of being at an amusement park.
Despite the prolonged uneasiness plaguing the industry, Mr Chua said he wants to hold on to his business at all cost because of the payoff. He declined to reveal specific numbers, but said that profit margins were high.
“(I) will sell everything of value that I have to keep the business running," he said, including his car.
J’Kids Amusement’s annual profits used to come in at an average of S$600,000, Mr Goh said. There were events every weekend.
His company has another S$1.2 to S$1.5 million to burn, which he estimates can last for another 9 months. If business were to fully resume, this amount could be restored in two to three years, he believes.
But there are more poignant reasons for enduring through this tough season.
“The reason why we are dragging on is because of our brand, 36 years. If we were five years, six years, we would have packed up already,” Mr Lee said. “We are selling happiness … the sentimental value is there.”
“J’kids is just like my baby,” said Mr Goh, who has been in the industry since he was 14. He had worked for an Indonesian amusement park company in Singapore before venturing out on his own in 2002.
And his employees? Like a “very big family”.
“The people that are still with me have been with me for (at least) 11 years,” he said.
“So if you ask me, it’s not about me. It’s also about the staff. And in this difficult period, if we are going to give up on them, they also got difficulties. They’ve got family.”
Mr Mohd Roszam also described his colleagues and boss as “family”.
“We have to hold on, just support him in this pandemic,” said the senior operations manager, who joined J’Kids when Mr Goh opened it in 2002. “I just hope everything will go through smoothly.”
Editor's note: The previous story stated that Carnival World is a two-year-old business. It is actually five years old. We apologise for the error.