Cost of loss: Business owners consider impact of Veishea cancellation
August 26, 2014
There are numerous questions swirling around Iowa State’s cancellation of Veishea, not the least of which is what the economic impact will be now that one of the community’s oldest and most popular traditions has been shelved.
Dan Culhane, president of the Ames Chamber of Commerce, said that the city attracts roughly one million visitors annually, according to the Ames Convention and Visitors Bureau. Culhane said that Veishea may not represent as much of that number as one might think.
“I don’t know that Veishea would be a [large contributor] to that number,” Culhane said.
Culhane added that while Veishea absolutely brought business to the community, Veishea may pale in comparison in terms of the economic revenue it generated when set against a Saturday football game or an international convention.
He also said it is important in an economic discussion to weigh the cost of an event to the community. That cost was particularly high with Veishea, considering the history of the event that resulted in riots on numerous occasions.
“There is no doubt that Veishea had an economic impact on the community, but I think when the decision was made to discontinue it, the economic impact was weighed against the cost,” Culhane said. “There was increased law enforcement and at times over the years there has been damage to personal [and city] property.”
Those calculable costs do not factor in the damage done to the university’s reputation nor the damage done to the community’s reputation as a whole when Veishea turned riotous, which Culhane said could create economic loss by discouraging visitors from coming to Ames.
While the exact economic impact is difficult to project for any one business, there are certain industries that will likely be hit harder than others.
“The businesses that people visit when they are in town for games and events will be the ones most affected, like restaurants and night life and hotels,” said Kim Hanna, director of the Campustown Action Association. “That is citywide, not just in Campustown.”
ISU president Steven Leath addressed the economic blow that will hit Campustown, detailing why he believed it is a loss that may be offset in the near future.
“I’m hoping that, with the investment in Campustown, we’ll be gaining business in Campustown when it gets revitalized,” Leath said. “We put, since I’ve been here, basically another five to six thousand students in this community. That economic investment is far more than tweaking Veishea.”
Despite the far-reaching effect of the university’s decision, which will stretch well beyond the Campustown limits, Culhane said that resistance from businesses during the task force’s discussions about Veishea — as well as after the decision to cancel it — was almost nonexistent.
“We are advocates for the Ames business community and we tend to be responsive to our members as needs arise,” Culhane said. “We have a little over 600 members and, interestingly enough, we did not hear from one member about the cancellation of Veishea or the pending decision.”
Culhane added that he does not believe the silence fell because the business community felt Veishea was unimportant, just that it understood this was a difficult but necessary decision Iowa State needed to make.
Culhane’s interpretation of the situation is not universally shared by all businesses affected, however.
Sarah Litwiller, the general manager of the Ames AmericInn, said she was disappointed in Leath and the task force’s effort to get community feedback on both the decision to cancel Veishea and potential alternative solutions to the problem.
Hard numbers will be difficult to project from business to business, and more will be known after April 2015 when the specific losses can be quantified. However, the numbers provided by AmericInn help illuminate what some businesses in Ames may see come spring.
The AmericInn has 66 rooms. In 2013, during Veishea weekend, it booked 59 on Friday night and 64 rooms Saturday night. In 2014, many of the rooms were booked in advance, but those numbers took a nose dive after Leath halted the festivities mid-week.
In 2014, the AmericInn booked 31 on Friday night and 43 on Saturday. Litwiller said April ended up being one of the hotel’s slowest months of the year because of the cancellations that cost the establishment a five-figure sum.
“Prior to [Veishea] weekend, we were almost sold out, but we lost a lot of rooms that people would have been staying in,” Litwiller said. “[We lost] what amounts to almost $10,000 in revenue due to cancellations.”
Matthew Goodman owns two food carts as well as The Fighting Burrito and Battle’s BBQ, which are located in Campustown. Goodman said that while Leath’s decision to abolish Veishea will be noticeable on his bottom lines, his brands will help his businesses power through whatever downturn comes.
“It is not as bad for us because we do not operate on a student population exclusively,” Goodman said. “Our brands, Burrtio and Battle especially, are a little more diverse demographically, so that helps a little.”
Like Litwiller, Goodman also questioned the task force’s decision, voicing concern that canceling the event did not appear to reach the heart of the issue, which he described as a “culture of behavior” that simply abolishing Veishea will not alleviate.
Goodman added that despite potentially losing business, he will not engage in the promotion of any of the Veishea-replacement event ideas that are popping up on social media.
Some events have already taken shape. One is a “Spring Musical Festival” that is hosted by Seek Entertainment and is set for April 2015.
Culhane said that the absence of Veishea will leave a void to be filled and that there is an economic opportunity for those interested in trying to capitalize on it.
“As long as [those events] are properly staffed, and there is a high level of self-control associated with those events, they can be highly successful,” Culhane said. “There is certainly an avenue for more events like that as long as there is heightened security and making sure people enjoy themselves, but not at the expense of others and others’ property.”