Holiday parties curtailed; caterers, restaurants suffer

The Record (Hackensack N.J.) (MCT) - Corporate holiday cheer is in short supply this year as unemployment climbs and a recession takes hold.

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Event planners, caterers and hotels are among those really feeling the pinch, as businesses scale back or cancel the year-end parties they normally throw to reward employees and curry the favor of clients.

"It's a very bad year," said Edward Fasani, owner of In a New York Minute, a Jersey City, N.J.-based catering company. Fasani, who relies heavily on party bookings from financial services firms on the Jersey City waterfront, said that last year by mid-November, he had 32 holiday parties booked. This year, he has three.

Business overall has plummeted by about 60 percent, as Internet orders for corporate lunches are way down.

"No one is spending, and those who are spending are haggling," Fasani said. He has trimmed his staff to six from 19 and has taken a night job as a consulting chef at a restaurant to make ends meet.

"To make it through January, February and March, you have to make money in December to survive," he said.

He is not the only one struggling, said Dennis Telischak, owner of Upper Montclair, N.J.-based event planner Audience Pleasers.

Telischak, who is president-elect of the International Special Events Society, helped plan holiday parties last year in New York City for employees of Lehman Brothers Holdings Inc., which has since gone bankrupt, and for Bear Stearns Cos., which has since been sold to JPMorgan Chase & Co. Without those clients, and with other companies scaling back party plans, he expects his holiday business to be off at least 12 percent.

New York City-based American Express, which last year had a big holiday bash for employees at the Hilton in Manhattan, recently announced plans to trim 7,000 jobs, or 10 percent of the work force, and has canceled this year's and next year's holiday parties as part of larger cost-cutting plans, said Joanna Lambert, a company spokeswoman.

"In the current environment, employees understand we have to be prudent in regards to operating expenses," she said. The credit card and travel company is looking for ways to cut costs on events and group meetings throughout the year, she said.

The Chicago consulting firm Challenger, Gray & Christmas Inc. said a recent survey of human resources executives showed 77 percent of companies are planning holiday parties this year, down from 90 percent last year.

For some companies, the cost of throwing a party is less of an issue than the fear of giving the impression they are insensitive to the plight of those struggling because of the economic downturn.

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"People feel they can't celebrate when they are laying people off," said Pat Strocchia, director of sales and marketing at the Newark Liberty International Airport Marriott. The hotel is doing seven holiday bashes this year, down from 10 a year ago.

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Not only beleaguered financial services firms are nixing holiday bashes.

An Asian shipping company from Secaucus, N.J., called off a party for 200 at Il Villaggio, a restaurant and catering hall in Moonachie, N.J., said owner Ralph Magliocchetti. A construction company and a pharmaceutical company also canceled.

Magliocchetti said this is the worst holiday season he has seen since 1989. "I have a lot of bookings, but I'm getting a lot of cancellations," he said.

A sharp downturn following the terrorist attacks of Sept. 11, 2001, lasted "only a couple of weeks," he said. Now, business is getting worse, and there is no end in sight, he said. Some of the half-dozen companies that canceled parties in the past month even forfeited their deposits, he said.

Cutting prices to try to fill the slots is not an option because operating expenses _ especially for food, utilities and employee health insurance _ have risen, and margins are already slim. So far, Magliocchetti has not cut staff, but he may have to in the months ahead.

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Florist Connie Farnham, owner of Peters Flowers & Gifts in Ramsey, N.J., expects to be decking fewer halls this year.

"We are anticipating that corporate and regular customers are cutting back," she said. "We'll push the $40 and $50 arrangements instead of the $100 arrangements," she said. "We're going to order light and see how it goes."

Some caterers say customers who have not canceled parties are cutting back in many ways, such as booking three-hour cocktail parties instead of five-hour dinner-dances. And they are more likely to skip the caviar and hot roast beef slicing stations in favor of miniature hot dogs and chicken on a stick.

Some companies are not inviting employees' spouses this year. Many are cutting way back on entertainment, going with a four-piece band rather than a 12- or 14-piece group. Open-bar hours are being reduced, and "some are just going with wine and beer," Telischak said.

"Employees and clients recognize that this is a time for belt-tightening," Telischak said. "This is not the time to be having big, elaborate parties."

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Terri DeToli, owner of Parties With Panache in Rutherford, N.J., said the market for private parties also is showing signs of stress. "We just had a birthday party for a gentleman cancel because he lost his job," she said.

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Camille Cerria, owner of Smooth Sailing Celebrations, a nautical event planner in Oak Ridge, N.J., said she has more open dates for holiday cruise parties on New York Harbor than usual. "In years gone by, only Monday and Tuesday nights would be available at this point," she said. "This is not the case right now."

Telischak and DeToli expect that fund-raising events and dinners for nonprofits will make up for a downturn in holiday parties.

Others will just "wait it out," Magliocchetti said.

"Maybe (President-elect) Obama will bring some magic," he said.

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