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Home arrow Archives   The American Surveyor     

Vantage Point: Business Lessons from an Ailing City Print E-mail
Written by Wendy Lathrop, PS, CFM   
Friday, 02 January 2015

A 136Kb PDF of this article as it appeared in the magazine—complete with images—is available by clicking HERE

In my pre-teen and teen years, my friends and I would head east to the Jersey shore town of Atlantic City. There we would swim in the ocean, then scour the boardwalks for the best salt water taffy and visit the arcades on the piers. We didn't realize that this seemingly idyllic time was during an economic downslide for an area that decades before relied on trains to bring big-city dwellers to the fresh air of the shore for weeks at a time. The rise of the automobile had transformed the way people traveled and vacationed, and the resulting freedom from long train trips meant shorter shore stays.

To revitalize the shore town, New Jerseyans passed a referendum in 1976 approving casino gambling in Atlantic City". Resorts hurried to transform two existing neighboring aging hotels into the first casino, opening its doors in May 1978 to eager crowds. In its craze to become "Las Vegas East" Atlantic City razed swaths of housing and largely became a one-industry town. The newly rich atmosphere spawned Abscam, a federal sting operation in the late `70s and early `80s netting a number of politicians in fake investment plans, famously including building permits and licenses for casinos in Atlantic City.

The good times did not last. Adjoining states began to allow gambling, creating competition. The recession hit. Revenues dropped. Quality sagged. State assistance had granted a little time for casinos to regroup to come out of bankruptcy, but no lifeline is being tossed to the ailing industry or the failing city now.

Since the start of 2014, four of the city's twelve casinos have shuttered their facilities. Casino suppliers and contractors have little hope of recouping millions of dollars of what those casinos owe them. Thousands of casino workers are out of work. One of the ripple effects is that property taxes for the remaining residents have skyrocketed: a 32% increase this July, on top of last year's 17% rise when falling casino revenues were already affecting the local tax base.

This may seem simply a story about poor urban planning, since neither the new convention center nor shopping outlets have countered the massive losses from casinos. But there are larger issues that transcend one ailing shore town. Far too many surveyors suffer similar fates, and there are lessons in the pain.

Countless surveyors decide to acquire licensure so they can work for themselves, be their own bosses, call their own shots, and do only the work they like. The usual measure of success is for a business to still have its doors open five years down the line, but this says nothing about the quality of success. Is the business able to keep up with insurance, payroll, taxes, and equipment maintenance? Does everyone working for the firm make a reasonable living wage, whether multiple employees or a solo practitioner? Is it still fun and exciting and providing a good mental workout?

A number of small firms open offering a single service. This is fine as long as you can provide that service excellently and people know about you and the field is not saturated. But if everyone is doing the same kind of work, the competition for limited needs spreads that work thinly and bad things can happen. Atlantic City put all its eggs into the casino revenue basket. Don't be the surveyor hoping to thrive on only doing small private lot surveys if that's not the kind of work likely to be most available in your area; if you have to travel too often and too far for jobs, your costs overcome the fee charged. But if you offer specialized services it's possible to market that across a broader region for a higher fee.

Single or limited service firms sometimes suffer by avoiding expansion that could broaden their potential markets. This can be from fear of the unknown, fear of the expense of growth, uneasiness with new practices. Atlantic City's bright new shopping area does not adjoin the casinos, is not well advertised at the casinos to draw gamblers during their off hours, and better suits the convention center on the opposite side of the barrier island. Marketing and market research both matter.

Another tactic for failure is dropping prices to draw more business. The effect is often a sag in work quality (and reputation). Longer hours for less pay means burnout for surveyors, as well as inability to upgrade equipment and technology. Many casinos cheapened their restaurants so they no longer offer exquisite cuisine for which their high prices are justified. Some offer barely mediocre school cafeteria quality buffets at moderate all-you-can-eat prices.

Small is definitely not bad for business. But be smart about it, planning before hanging that shingle and continuing to plan for and adapt to inevitable changes in the market over time.

Wendy Lathrop is licensed as a Professional Land Surveyor in NJ, PA, DE, and MD, and has been involved since 1974 in surveying projects ranging from construction to boundary to environmental land use disputes. She is a Professional Planner in NJ, and a Certified Floodplain Manager through ASFPM.

A 136Kb PDF of this article as it appeared in the magazine—complete with images—is available by clicking HERE

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