Impacts of Hosting the Olympic Games on Local Businesses - Literature review Example

?Impacts of Hosting the Olympic Games on Local Businesses Olympic Games have been ranked top among the events that bring individuals from various countries together. Every four years, players from various countries come together to compete amongst themselves in new venues in front of numerous spectators (Zimbalist, 2011). In addition, most of the sports fans who do not manage to attend these games watch them on television. It is worth noting that Olympics have led to a significant rise of related businesses that improve the standard of living of those involved in these businesses in host countries. In most cases, the participants are professionals who are appropriately trained and the organizers of Olympic Games are well compensated for their efforts. In preparation for Olympic Games, host countries normally get involved in massive renovation projects that become beneficial to them for many years. It is essential to state that Olympic Games have both positive and negative impacts on the host country and most of these impacts associated with the Games are either social, or economic among others (Theodoros, 2007, p. 12). In most cases, when a country is hosting Olympic Games, there are high expectations by the local businesspersons that they will receive more business due to the coming of spectators to view the events but in some instances, such expectations are not met. For instance, during the recent London Olympic Games, local small business individuals expected an Olympic pump in their business but this was not the case. They claimed that this was just unusual because vendors attended the 2012 Olympics expecting to have fabulous volumes of sales in August, but it was not so. During the opening day of the Olympic Games, local traders registered a 10% decrease and throughout, there had been a 12% weekly and 16% rises in the footfall, in London West End businesses (Dreyer, 2011, p. 11). Most people state that trade has not been as good as some individuals may think and this is because the city appears to have been deserted by a majority during the day. In addition, small business owners felt that there were few tourists in the city willing to spend their money. According to Ed Francis who operates a Hampshire Hog in the western part of London, there has been a slight drop in daytime businesses since the commencement of London 2012 Olympics. The drop in trade has also been associated with the increasing number of local people who choose not to attend the Olympics and decide to take holidays out of the country. This means that local tourists who at times take rooms decrease in number (Leggat, 2003, p. 201 - 203). In most cases before the Olympic Games commence, local residents feel that demand for roads and the entire public transport network will be high. As a result, a well-coordinated multi agency is set up to manage such and ensure that people get to their places of work in time. In most instances, Olympic Games led to increase in the need for transport and as a result, it is always necessary to plan to ensure that the local individuals’ daily operations are not affected (Adam, 2005, p. 67). For instance, in London, the local parking and traffic management plans were set up to ensure that spectators were not allowed to park their vehicles near the venues. These steps were aimed at ensuring public safety, promoting efficient operations in the venues, and creating emergency routes. The freight industry was also very busy during the games and despite the fact that most roads were busy during the Olympics, freights always found their way through the challenging operating environment (Weed, 2012, 75-80). Mostly, the town councils are assigned the task of operating lorry schemes to ensure easy and fast delivery. They have always preferred night delivery to avoid late delivery and unnecessary traffic during the day. It is worth noting that games play a significant role in ensuring improvement of the local roads. For instance, in London, there was an improvement at Stratford and the Kings Cross. Furthermore, there were extensions in East London, South Fields, and Green Pars together with enhancement of cycling and working routes. Some time back, Olympic Games had been held in Sydney, Australia; as a result of these games, Sydney entrepreneurs and politicians had a perfect chance to reposition their city globally. In addition, there was restructuring of the local economy due to creative industries set up, however, despite the significant economic benefits and their positive impacts, there were also numerous negative social impacts of the Olympics. Before the commencement of Olympic Games in Sydney, there was the massive restructuring of roads to accommodate the increasing number of people who visited the city and this, in addition, aimed at reducing traffic and congestion. Just as it was in London this year, spectators were not allowed to park close to the venue with an aim of paving the way for emergency exits. The number of local tourists was on a fall, while international tourists were on the rise and this was due to the spectators who visited Sydney for the first time; as a result, there was an increase in the demand for rooms for accommodation. However, local retailers also stated that there was a fall on the demand for their products during the day as most people spent most of their time in the sports venues. It is vital to note that hosting Olympics does not only require support from the public, but also a venue that can accommodate most of the sporting activities (Brunet, 2005, pp. 6-8). These are some of the preparations that are put in place by the Olympics Committee whose task is to organize the Olympics. In 1990, the New South Wales government identified Homebush Bay as the only available venue because its size was reasonable and was enough to accommodate most of the games. Moreover, the surrounding environment was enough to offer the necessary services that would be required by the spectators and participants. After the 16 days of the Olympics in New South Wales, people who attended the event had more reasons to celebrate than to protest. In 2000, the Olympics that took place in Sydney was also fabulous as it offered enough and satisfactory services to the attendees. However, it is crucial to state that as individuals of host countries prepare for Olympics, there are always high expectations, especially by the small business individuals; nevertheless, only smart individuals manage to meet expectations (Weinberg, 1981). Business people who know the strategic places for conducting their businesses are the only ones who manage to record an increase in their volume of sales. The social and cultural impacts of the Olympics are also significant in most of the host country, this is due to the convergence of diverse individuals from various cultural and social backgrounds, and the varied ways of conducting themselves who manage to influence others. Olympics have been noted to have a significant impact on the economic welfare of a country and this is so because it can lead to either improvement or deterioration (Kaplanidou, 2010, 110 - 117). How the London Olympic Games have affected businesses According to statistics, there were over 6431 workplaces that are registered in London in 2008 and out of all these work places, 99.3% are small and medium size businesses which are able to accommodate not more than 199 employees. As the Olympic Games approached, small business owners in London had high expectations that encouraged them to get into preparation. Westfield Stratford city is a large 1.9 million square foot shopping mall that was opened on September 13 2011 and is located in the East of London. It is the home of the Olympic Park and is considered to be among the largest shopping complexes in Europe; during the London 2012 Olympics, most of the people stated that Stratford was the place to spend and this was so because 17 out of 26 Olympic sports took place within 15 minutes walk venues from Stratford. The shopping centre decided to shut down its doors to non-Olympic visitors in the town on the 3rd and 4th of August (Wedekind, 2008, p. 44). This was due to its extensive use by spectators as a short cut for getting to the Olympic Park. Most of the stalls in Stratford performed excellently as far as the sale of medals was concerned and this resulted from the many visitors around the globe who visited the area. It is worth noting Stratford shopping centre recorded high volume of sales on the first day of Olympics. However, it is too early to conclude on the impacts that London Olympics had on trade. It is necessary to note that Westfield Stratford is among the places that enjoyed a reasonable increase in the volume of sales. The increased sales volume resulted from the sale of foodstuff, Olympics branded wares, and sportswear. Although majority of the sporting events took place at the East End, traffic at the Westfield London has been on the rise compared to normal weeks. Retail trade on Bond Street and related high-end trading avenues at the western part have reduced; according to New West Company, one of the trade groups representing several London retailers, it was indispensable to tap to emergency advertising fund that attracted shoppers. It is worth commenting that visits to the central London shops reduced by about 10 percent on the first full week of the Olympics and this is based on the research conducted by the research firm Experian. According to springboard that tracks the shopper numbers, footfall reduced by almost the same rate at retail corridors outside London. According to published reports, most of the retailers complained that they received fake warnings from some of the public officials concerning traffic disruption that deterred most of them from entering to the city. There was foot traffic at Manchester that was higher by 8% compared to those in prior years. Stratford catering offer did extremely well since the beginning of the Games. In most of the rooms in Stratford, there were televisions that enabled spectators who did not manage to go to the field to watch the coverage. It is significant to note that according to a representative, Westfield Stratford City recorded an increased number of visitors through out the period (McDowell, 1999). Bearing in mind that Stratford was the location of a majority of the sporting activities, the 2012 summer was uniquely affected. On a daily basis, over 300,000 people entered the Olympic park and 70% of these people were from Westfield Stratford City, and the rest were from two spectator transport malls. Moreover, Olympic Delivery Authority invested several millions of pounds in upgrading and extending Stratford's transport connections, as well as the substantial expansion of regional station and new Stratford International link; this led to additional Olympic visitors who placed significant strain on the existing transport network, and the surrounding roads. In addition to the numerous visitors who were on the streets and pavements in Stratford, the Olympic Network Route, the devoted conveyance network for athletes and important Olympics staff, passed through Stratford's town centre and the Stratford Centre. The games had a significant impact on the transport arrangements, businesses, and access to residents in Stratford and for businesses to perform well in Stratford. Therefore, it was essential for the residents or local businesspersons to be aware of the possible impacts of games and this would enable them to be better prepared and carry on their businesses despite the possible disruptions that would result from the games (Burton and O'Relly, 2009, p. 33). According to Price Waterhouse Coopers who were commissioned to undertake critical analysis on national, local, and regional impacts of London 2012 Olympics, there were numerous possible impacts and most of these impacts were social, economical and environmental. According to Clark from Price Waterhouse Coopers, he managed to describe urban developments in the next eight years. However, as for Stratford City, Price Waterhouse Coopers stated that by up skilling 70,000 volunteers up to 7.9 million spectators would bring an estimate of 2.1 billion pounds. The extra revenue earned amounted to 400 million pounds that affected areas away from London and over 8,000 jobs for local individuals on construction were created. The greatest economic impact of GDP amounted to 3.32 billion in London during the pre-games. Overly, there is a high probability that Olympics had up to 84.4% chance of improving the GDP of the United Kingdom. At the same time, there is 10% possibility that the United Kingdom got a loss of up to 517 million pounds (Worsnop, 1996, 289 - 312). According to a study by Nottingham University, eleven to twelve percent of the GDP effect most of the time results from infrastructure expenditure. According to Rose, economists are sceptical concerning the economic benefits of hosting such events because such activities have significant cost and appear to yield minimal tangible benefits. According to previous studies of the impact of Olympics, there are enough indicators that inward investment has been on a rise while on the other hand, there is little Foreign Direct Investment according to an analysis of 21 global events that included 5 Olympic Games, only two citations of impacts on Foreign Direct Investment were made. The most important issues are based upon developing and understanding of potential economic impacts associated with the Olympics to recognize what can be done to ensure the most benefit advantage for the local area. Finally, when a country is hosting Olympic Games, there are high expectations by the local businesspersons, that their business performance will be high. However, in some instances, such expectations are not met and as a result, the businessperson should bear in either mind that they can succeed or not (Knickerbocker, 1999). References Adam, B. (2005). The Economic Impact of the Olympics. [WWW] Acaemia.edu. 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