Hydroslides lose income through discounts over 15 weeks

PHOTO: LAURA SMITH
PHOTO: LAURA SMITH
The Invercargill City Council lost more than $11,000 in the first 15 weeks of its new $3.2million hydroslides.

Three new hydroslides were installed at Splash Palace on April 19 — two shorter body slides coloured green and blue (69m and 79m long, respectively), and a 101m raft slide featuring a large sphere section.

The new feature increased the number of admissions, but discounts and closure of its main slide for maintenance, due to structural problems, meant the facility had a smaller revenue than expected.

A report from chief executive Clare Hadley said Splash Palace had $70,554 of revenue and spent $81,795, on staff wages, electricity, purchase of chemicals and loan repayments, during the first 15 weeks of new slides’ operation.

This left a deficit of $11,241.

Mrs Hadley’s report will be presented to the council at the infrastructural services committee meeting this week.

She explained in the document the facility noticed an increase in admissions over the 15 weeks, with 1288 users on average per week.

However, the entry price had been discounted on three occasions — a 60% opening discount special for four weeks to manage expectations, a 60% discount for the week the two body slides were closed and a current discounting of 30% due to the closure of the raft slide.

"If no discounts had been applied at all, then the hydroslides would have taken a revenue of $136,829.00 in the 15 weeks.

"However, not having a discount could have potentially impacted the participation numbers and the actual revenue may be slightly lower than the estimate."

Other factor which could have affected the revenue was the closure of the raft slide — one of the highlights of the facility — just before the school holidays.

About three months after its opening, the council noticed a structural issue with one of the supporting columns which had to be replaced.

Mrs Hadley believed during the two weeks of the July school holidays alone, it was estimated there was a potential loss of revenue of $24,637.

"Although we are slightly behind on recovering our costs after the first four months, the slide has only charged normal entry prices for 50% of the time.

"When the operation of the hydroslides becomes more stable and consistent, management would expect to see better overall recovery on the hydroslides use."

luisa.girao@odt.co.nz

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