SR Panel: Managing Four Separate Jurisdictions

Panelist navigates operating in several towns through pandemic

Scott Clark
Owner, The Spa and Sauna Co.
5 locations in Nevada and California

The pandemic was firmly on our radar in early February when a vendor trip to Cambodia and Vietnam was canceled a week before we were supposed to leave. Of course, at that time the events that have transpired were not really grasped. In early March, the thought of shutting down the economy was not being taken all that seriously. By mid-March that changed. The mayor of Reno announced that she was ordering the city closed. That night, the neighboring city and the county rejected following suit. We thought we dodged a bullet. Within three days California, where we operate two locations, and the state of Nevada, where our other three locations are located, closed as well. Every business owner thinks that they are essential. If not, we never would have opened. The big unanswered question: do the four different jurisdictions we operate in feel the same?

Our first task was to determine how much capital we would need to survive and pay our team for up to eight weeks. Next, how can we continue to service our clientele, both legally and safely for ourselves, our team and our customers. We leaned on a group of other dealers who were starting to fall under similar regulations, and we read and reread every government order trying to find our niche to maintain operations where we could.

Ultimately, we homed in on three critical infrastructure areas that, in our minds at least, we could wedge our way into being deemed essential. Water sanitation products seemed natural, along with repair and maintenance of appliances and infield water sanitation. We also fit into the supply chain, distribution and delivery of several of our product categories. Once we had our talking points, we placed signs listing why we were essential at every entrance and our website. We also presented our case to our attorney and asked for a legal opinion of our operating status. That opinion is still at the front of every location, six months in. We locked the doors and offered curbside pickup of water care products and accessories for more than two months.

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Our team also focused on following the work from home and limited access requirements that were slightly different in each county/state. Within a couple of days, we had remote access set up for our phones and computers for all office staff and all of our sales team. Everyone who didn’t need to be in one of our buildings, worked from home.

Within a couple of very long weeks, our thoughts went from “How do we operate and keep from laying everyone off?” to “I hope we have enough inventory.” What we hadn’t really thought about while trying to scramble and survive the closures, was that everyone was home and boredom set in quickly.

Web traffic doubled and form fills tripled or quadrupled. Customers were asking, “Can we come in and see spas?” All of the sales training focusing on screen-to-screen presentations and video texting quickly evolved into FaceTime, Zoom, etc. We took short videos of every model on the floor and edited a playlist to send and show prospective clients. The sales staff that was in store on a given day would FaceTime video of hot tub models and then ask to flip the camera to walk the backyard. In a matter of minutes, we had compressed the buying process to a 10-15 minute presentation and backyard consultation.

We have set internal sales records for the April-August period every month. And when the factories started opening up, we realized demand was far outstripping supply, forcing us to pivot once again. Managing customer expectations and our inventory are now our biggest challenges. We are selling more spas than our vendors can supply. Before too long, orders for all of our 2021 product will be completed and we will start forecasting our product needs for 2022.

It is unprecedented and unnerving. But it is a much better position than we were in 2008-11 when we could get all the hot tubs we needed and had no customers.