Businesses begin, businesses end. It's the way of life.
But times have been especially tough recently. Particularly in places like the South Okanagan, where the service sector reigns supreme and the quiet of the off-seasons are typically offset by the heady days of summer.
In early 2020, this already challenging landscape was hit with a pandemic – a pandemic that for two-plus years wreaked havoc with everyone and everything but hit the service sector ridiculously hard.
Do we close? Do we open? How much distance? How many people? Who's vaccinated? Who isn't?
But the end of social distancing and vaccine card checks didn’t close the book on COVID. Many businesses remained slow as 2022 moved into 2023.
And now, another threat. The deadline for repaying all those Canada Emergency Business Account (CEBA) loans, nearly a million of which were handed out during the pandemic, is Jan. 18. Unless you've refinanced to March.
Regardless, the loans that aren't squared up will begin accruing interest. Word is that a lot of those loans will do just that.
And COVID is just part of the problem.
It doesn’t take an economist to know that the price of just about everything important – from used cars to seemingly every item at the local supermarket – has exploded in the past couple years.
And that means businesses either pass those increased costs onto the already-stressed consumer, or they eat the increases and try to hang on. And of course the consumer, now faced with elevated prices in most directions, has less money for discretionary spending.
It’s not a good scenario. But wait…there's more.
In late summer 2023, wildfires erupted all over the Okanagan. Even worse for the tourist trade, the provincial government enacted a reactionary southern interior travel ban on August 19, primarily to make room in hotels for wildfire-displaced residents.
The smoke wafting into places like Penticton and Osoyoos from regional fires was bad enough. But now people were ordered to leave and/or stay away. Within a couple days, beaches and typical summer gathering spots were flat-out empty.
Those restrictions were lifted just days later, but few were coming back to the Okanagan as the summer wound down. Businesses that rely on seasonal tourism were hit hard.
And let's not forget about the massive rockslide that covered Hwy 97 a few kilometers north of Summerland just days after the travel ban.
It cut off the only local, paved route between Kelowna and Penticton. In fact, it sporadically continues to do that today.
What's next? Plague? Locusts?
All of this brings us around to two recent announcements from two different businesses that each came to the same conclusion: They had to pull the plug.
The first, from Jan. 3, came from Penticton's "Meeples and Milkshakes" (180 Google reviews, 4.9-star average), the funky downtown eatery opened in 2020 by husband and wife Jim and Cheryl Roepcke that mixed board gaming with yummy milkshakes and snacks. Meeples, they said, would close forever Jan. 14.
The second came two days later from Oliver-based e-bike tour company South Okanagan E-Bike Safaris (95 Google reviews, 5-star average). After six years of giving folks fully guided group e-bike tours throughout the South Okanagan, they too were calling it quits.
We chatted with both to find out why, starting with Meeples. It was, after all, the first to announce the news.
Meeples and Milkshakes
"We suck at business," deadpanned Meeples co-owner Jim Roepcke when asked why they called it a day. "But really, bad timing is probably the root cause. All the things that happened flowed from bad timing.
"And for us that bad timing was COVID. We, like everyone else, didn’t think it would have the impact it had. We thought it would be three to six months of disruption."
According to Roepcke, the couple grabbed a government renovation loan in February of 2020 and signed the lease just weeks later, while "coronavirus," as it was commonly termed at the time, was still quite mysterious.
"I don’t think even the government back then thought it would be as bad as it was," he said. "But by April of 2020, we were wondering if we should even do this.
"And then we found out we didn’t qualify for the subsidies all the other businesses were getting. It covered, if I remember correctly, 75% of rent and wages 'til May of '22.
"So we incorporated in 2019 and got the ball rolling before the word COVID was even uttered, but we didn't qualify because we didn’t have 2019 revenues. All the losses we ever took we took ourselves."
But the new entrepreneurs figured turning back was worse than soldiering on. So they pushed forward, finally opening in September of 2020.
"The first seven weeks were awesome," said Roepcke . "We had wait lists almost every day. But then the government said you couldn't sit at a table with people outside your household. And that was when everything changed.
"Up to that point, the public was still gathering. They were still behaving like they used to. But when that happened, the psychology was changed."
More mixed messages and restrictions followed, spanning many months. Roepcke describes those days as "terrible."
"It wasn't 'til April of 2023 that we finally got to run our business the way we’d intended to run it," he said. "But we'd lost a huge amount of money and had no government help like many of the businesses we could see around us.
"And I think because of the social nature of our business, we noticed more than other businesses what appeared to be a permanent change in people's behaviours and feelings toward social contact. And that continued to impact our business in serious ways."
Along the way, in 2022, Jim Roepcke suffered a heart attack. As heart attacks go, it was minor. But it was scary nevertheless. And a potential warning shot.
"Certainly the stress and the fatigue of the café played into that," he said. "I also had COVID just a month before, and I think that's what put it over the top."
And now there was a new adversary – the economy.
"Things were finally getting better from the restrictions point of view and then the economy weakened dramatically," said Roepcke. "Our costs went up hugely. We probably should have raised our prices, but when you don’t have people coming in the doors, you don’t want to give them even less reasons.
"We were buying ice cream when we opened for $17.49 for an 11.4-litre pail, and the day before we closed I bought a four-litre pail for $9.49. But we didn’t double the price of our milkshakes."
The travel restrictions of late summer 2023 had their impact too, but not right away.
"I was fully expecting to be completely dead because the government told all the tourists to leave," said Roepcke. "But what happened I think is that all the people from Kelowna came to Penticton. And a lot of them hung out at my café for two weeks straight. The last week of the restrictions was our second busiest ever.
"But after that, it was crickets."
Roepcke believes late March will be a telling time for a number of small businesses.
"I think the reason you don't see a flood of businesses closing now," he said, "is because everyone who applies for refinancing of their CEBA loans is getting 'til March 28 before they have to start paying it back. But we'll see."
Last Sunday, Jan. 14th, was the final day of operation for Meeples and Milkshakes and for the five employees who worked there to the end. It was their second busiest day ever, outdone only by the Saturday eight days prior. But they weren't going to fall for the siren song of last-minute crowds.
"We tried appealing to the public in the past," he said. "That got us a couple weeks of solid business, and that was it. We don’t want to keep crying to the public."
And now comes the tricky part. The lease at their 130 Westminster Ave. South address runs for another year. So going forward they're looking to find a sub-lessor or someone who might be able to negotiate a lease takeover or potentially a whole new lease.
He believes the location, in the midst of what has recently become Penticton's hottest food and beverage district, is strong.
"We know we have a good location," he said. "We think it’s the best neighbourhood in town for entertainment or food right now. Plus, the new owners wouldn’t be opening at the outset of a pandemic, and they won't have to pay out for renovations because we've done them all."
So what will Jim, now 48 years old, and Cheryl, now 50, do in the weeks and months ahead? Fortunately, they never did give up the jobs they had before Meeples. He's a software developer and she works with BC Housing. And that'll continue.
"It burned us out, but we kept those jobs," said Roepcke. "We had no choice but to keep them because we were losing so much money."
And they'll keep their online board game store open briefly too 'til their inventory runs out. And that'll be it.
"It was up to us as businesspeople to make the place profitable and appealing to people, and we utterly failed to do that," said Roepcke. "But we went into the business for the love of the hobby and the love of the community, and we exited having not lost any of that love at all.
"I know we didn’t do everything wrong because of the kind of sentiment we’ve been seeing over the past couple weeks. But I do want to apologize for shutting it down because I know it was a meaningful place for a lot of people."
Anyone interested in reaching out to Jim and Cheryl Roepcke can do so for the time being at [email protected].
South Okanagan E-Bike Safaris
Whereas Meeples and Milkshakes dealt in board games and treats, Oliver-based "South Okanagan E-Bike Safaris," run by Edmonton-to-Okanagan transplants Max and Debbie Barclay, was all about two-wheeled tours and wineries.
But today they have one dominant commonality. They both closed for good in January.
"We did fully guided tours on e-bikes, usually to different wineries," said Debbie earlier this week. "We had five different tours we’d take people on – Black Sage Road, the KVR Trail to Naramata, the east side of Skaha Lake and two in the Osoyoos area. One that focused on wineries and the other on historical interest."
"We were the only fully guided e-bike tour company down here."
According to hubby Max, they were closing in on profitability.
"We moved here in 2017, incorporated in 2018 and physically got started in 2019," he said. "We've enjoyed steady growth since then -- modest but steady every year.
"We think we still had two or three years 'til we were making really decent money out of it."
The emphasis, they maintain, was on safety. Fun too of course, but safety was a big priority.
"We only took out smaller groups – family or very close friends," said Debbie. "Max is fully trained in first aid, and we made sure our customers were always safe. I cycled at the back, Max in the front, and we’d be connected by walkie-talkies.
"And the tasting was very well controlled. By the end of the day you'd have been at maybe three wineries in total. You'd have had perhaps a glass of wine each by the end."
By 2023, the business had 15 high-quality e-bikes in their fleet and as we alluded earlier, a perfect 5-star rating at Google Reviews.
Even COVID didn’t slow them down appreciably because, as has been documented consistently, folks took to bikes during the lockdown.
The future looked bright. Then, say the Barclays, along came the impact of a troubled economy and inflation. And then the worst blow of all – the wildfire-induced travel restrictions of late summer 2023.
"Last year, our bookings at the beginning of the year slowed right down," said Max. "As the year went on, we could see that things were not going to be as prosperous as the year before.
"And then on August the 19th, the BC government made the announcement to stay away from the South Okanagan, and if you're in the South Okanagan, pack up and get out."
The ban would be rescinded outside the particularly hard hit Kelowna area just a few days later, but the emptiness virtually everywhere through the remainder of the 2023 tourist season spoke volumes. People weren't coming back.
"We then had a meeting with the Minister of Tourism," said Max. "There were about 100 people, and we limited our conversation to people who'd been in business a long time here – like the Executive GM of Spirit Ridge, Coyote Cruises, that sort of thing."
The meeting addressed the dissatisfaction of regional tourism-related businesses with what they perceived as poor government decisions. It also approached the concept of compensation.
"After the meeting, we got a copy of the follow-up letter from the Thompson Okanagan Tourist Association," said Max. "But in essence, the government has absolutely ignored all the cries for help. We’ve seen no compensation."
Debbie Barclay says tourism in the extreme southern Okanagan was annihilated.
"Osoyoos and Oliver were absolutely dead for the last few months of the year," she said. "We still would have had bookings into October if they hadn’t made the announcement.
"And the only compensation were grants to Indigenous tourism (in December, $25,000 grant applications were made available across Canada to businesses that support Indigenous-led tourism) and more loans to everyone else. That’s not going to help us. We don’t want more debt."
Max agreed that the ban and its after-effects were the last straw for their business.
"We attract people who are close to retirement or in retirement, and we also had that small segment that takes advantage of the shoulder season," he said. "So this really punished us.
"And then on top of all of that, we had Air Canada pulling out of Penticton airport (announced in mid-September). So there's very little support. I don't blame it all on the Ministry of Tourism, but along with the global financial crisis, it became impossible to continue."
Nor do they see the outlook brightening in the near future.
"The economic situation, which started long before the Tourism Minister put the kibosh on business for the year, is very dire," said Max. "And people are going to prioritize their personal expenses over extravagances like tours and travel.
"This also comes at a time when everyone has to pay back their CEBA loans. We were fortunate in that we'd put that money aside, but businesses that have to pay it back are in tough shape."
As for Max and Debbie, both in their mid-60s but looking and sounding younger, they, like Jim and Cheryl Roepcke, are now working other jobs.
"Debbie's gone back to working online, doing administration for a family lawyer," said Max. "And I took a job in September at one of the major rental car companies in Penticton."
As a bonus, they’ve already sold more than half their fleet of Bosch-driven "Cube" e-bikes, all to former customers. "They were picked up immediately as soon as we announced it," said Max.
Still, they'd rather be leading tours of happy e-cyclists through the South Okanagan in the business they built from scratch, aboard the electric bikes they worked so hard to acquire.
"We could have survived 'til next year," said Max, "but we just don’t want to lose any more of our investment."
To contact Max and Debbie Barclay, email them at [email protected].
