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The Honolulu Advertiser
Posted on: Tuesday, February 12, 2008

Small businesses dealt another blow

 •  Second cruise ship leaving; so will jobs

By Curtis Lum
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser

Anna Golden of Joy's Gift Shop in Hilo shows a sarong that is popular with cruise-ship visitors. She's optimistic that she and her family will weather the storm when the Pride of Aloha leaves Hawai'i.

TIM WRIGHT | Special to The Honolulu Advertiser

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Small-business owners were not surprised when NCL America announced last year it was transferring one of its Hawai'i cruise ships. But yesterday's announcement that a second NCL ship would leave was a shock.

Those business owners are wondering how they will survive that second departure.

"It's going to be a real vacuum," said Marie Aguilar, president of the Kailua Village Merchants Association and owner of the Eclectic Craftsman in Kona on the Big Island.

Many of the association's members, such as snorkel tour operators and restaurants, rely on visitors to survive. Aguilar said it will be difficult to make up for the thousands of NCL passengers that visit Kona weekly.

"We've been in business 14 years and we've gone through many stages of the economy, but we find that the cruise ships have really overwhelmingly improved our local economy," Aguilar said. "I can tell you that the business during the days that the cruise ships are here is so improved, it really is. Now with the slowing of the economy, we've already noticed that the passengers who are arriving by airplane is decreasing."

Aguilar said NCL passengers account for 60 percent of her sales when the ships are in port.

On the east side of the Big Island, several business owners said the loss of a second NCL ship will hurt many.

Joy's Gift Shop on Hilo's bayfront carries tourist-oriented souvenirs and most of its business is from the cruise ships, said Anna Golden, whose father owns the store. Golden said a shuttle drops off NCL passengers across the street from the shop, and that was a big reason her family picked that location.

"When there is a ship, it is a very, very good day. When there isn't a ship, then it's pretty slow," Golden said.

She said the store also attracts local residents and she's optimistic that it will weather the storm.

"We will have to wait and see how bad it gets," Golden said.

Christine and David Reed own Basically Books in Hilo, where cruise ship passengers often shop. Christine Reed felt NCL was saturating the market and competing with itself when it had three ships operating in Hawai'i, but she believed the Islands could support two.

Reed said the shrinking cruise business will have a ripple affect on all businesses, not just the ones that deal directly with the passengers.

"We like to think that people who come on cruises and have a positive experience here are going to come back, so it takes a little bit of that away, too," she said. "We hope that people that come and visit the port for a day on a cruise ship will say, 'Oh, I want to come back and visit the Big Island and stay a week.' "

On Kaua'i, NCL had visited the island three times a week and had a huge economic impact. But with trips soon to dwindle to one a week, owners such as Fred Atkins are concerned.

Atkins is a partner in Kilohana Plantation, which puts on a lu'au show, and each NCL ship brought from 650 to 940 people. Losing one ship was bad, a second one unimaginable.

"We have over 100 people who are employed four nights a week," he said. "It's the best staff that I have ever worked with and I will do whatever it takes to try to keep their jobs."

Atkins added that the state needs to ensure that Pride of America remains in Hawai'i.

"We need to work together with them to show them that a ship like this on a weekly basis can be profitable in Hawai'i," he said. "It's a huge economic impact, especially in a time when we're maybe entering a recession, definitely a soft economy."

Reach Curtis Lum at culum@honoluluadvertiser.com.