Small businesses keep their hopes high

Children's playgrounds

Asked for his advice on starting a business, Jiang Jun has a straightforward reply. "I suggest you avoid doing this if you can feed yourself on what you earn already," he said.

A former manager at a finance company and now the owner of two indoor children's playgrounds in Chengdu, capital of Sichuan province, Jiang has learned a bitter lesson.

Last month, revenue from his suburban rock-climbing playground, which has been operating for two years, fell by 20 percent to 30 percent year-on-year because of the pandemic.

His newly opened playground, Mengka Children's Paradise, has toys for preschool children and is near the city center, but revenue from the opening day on June 6 to June 30 was similar to that earned in a single day at his first playground at the start of last month.

"I don't think the impact of the pandemic on the children's entertainment industry will be fatal for businesses, but more operators have begun to sell secondhand equipment or have announced they are pulling out of the market," Jiang said, citing information from peer WeChat groups.

Before the contagion emerged, he signed a contract for the new playground with a shopping mall and paid six months' rent of more than 100,000 yuan. He also spent about 400,000 yuan on decoration and renovation work, but knows he will be unable to recover his costs this year.

Jiang has tried many ways to boost business, including discounts and marketing activities, but these have had little effect.

"Before the pandemic, people often paid for products or services directly when they visited a shopping mall. Now, they think hard about whether such spending is really necessary," he said.

"Many parents have had their salaries cut and some have even lost their jobs, so they are not nearly as willing to pay for children's entertainment. Instead, they are looking to invest in their kids' education.

"Furthermore, some people are avoiding crowded public areas," he said, adding that the shopping mall has told vendors to limit the number of customers to 20 as part of pandemic control measures.

Jiang's first playground, which occupies about 140 square meters, is aimed at children ages 4 to 12 who want to try indoor rock climbing with the help of adult coaches. Before the pandemic, it catered to a maximum of 200 children a day during holidays, with admission costing 58 yuan.

The new 600-square-meter business has a 200-yuan membership promotion covering six visits.

Jiang plans to close the older business when the contract expires in January, as he fears further rent rises, which since 2018 have grown from 8,000 yuan to 13,000 yuan a month. He is also worried about declining revenue.

He plans to continue with the new business, as he has sunk nearly all the profit from the old one into it, but has noticed a drop in the number of potential customers and more stores closing.

"It's sad to see this, because Chengdu is a city with a vibrant retail trade. We need to figure out ways to open up the market and stimulate consumption," he said, adding that he is in negotiations with an English-language training institute in an attempt to attract more customers.

This initiative involves the institute staging courses at Jiang's business twice a week, with instruction fees and client resources shared. The playground will also organize birthday parties for young students once a month, with friends invited.

When he left the financial sector, Jiang was leading an 80-strong team, but he said he decided to make a move because he didn't want to regret not starting his own business.

"When you start out, you think you're special, but you soon find that success is only earned by a few, and that your own is not even worth a mention. You expect to experience problems and difficulties, but there are so many of them. At the end of the day, you have to admit that you're just an ordinary person," he said.

"Some of my former colleagues now earn more than 100,000 yuan a month and never have to experience such ups and downs."

Jiang expects his business to recover in the second half of this year, when nearby schools, supermarkets and a community vaccination station open. He also anticipates making ends meet next year if the pandemic is over.

"If it doesn't work well, maybe I'll try a smaller business or invest in other people's," he said.

Asked if he had considered returning to work for a company, he said firmly, "No way."