We Lost Our Best Location Because of a Contract Clause We Didn’t Know Existed

In December 2023, almost three years into what had become our most successful operating year, I opened my email and found a procurement announcement from our County.

A public call for bids. For 40 medallions. At our location.

Our park. The one we’d operated out of for twelve years. I was confused. There were only two lots of 40 medallions. We had one and another company had one. Surely there must be a mistake.

I called the county immediately. It was a Friday afternoon. “Is this ours?” I asked.

“Yes”, they said, and then told me to call back on Monday. I had the entire weekend to fret and worry.

That’s how we found out we had to re-bid for our primary operating location — not through a phone call, not through a meeting with our contract manager, but through a public procurement notice that happened to land in my inbox.

Here’s what happened, and what I wish I’d known sooner.

When we first won the Lido medallion concession, we did it as a joint venture with a small local company company. For the story’s sake, we will call the owner, Kitty. She had a few boats, ran casual tours a couple times a month, and didn’t want to lose access to the park when the county restructured its permit program. Neither did we.

We worked out a joint venture agreement. We’d have the main operating rights. She’d have access to five medallions whenever she needed them. It seemed fair. It was what both of us wanted. She would maintain her access to the park on a minimal basis (she was very small scale, like $5000 or less per year). We would maintain our access to the park and cooperate with each other. Neither of us assumed we would win the 40 medallion lot. She had been operating with 3 or 4 medallions and we had 15. Both of us were very small.

As soon as we heard we won, there were problems — a parking space dispute, disagreements about equipment, a fundamental mismatch between how she operated (casually, by appointment) and how we operated (structured bookings, staff on site daily).

I tried to negotiate.

I suggested mediation. She declined to participate stating she didn’t want to spend the money.

Eventually we just kept going. We were operating 35 medallions every day. She was coming in occasionally, doing maybe $2,000 in the spring months. We were doing $100,000 per month and had a full time staff of five and a bunch of part time staff.

The partnership was dysfunctional but not actively destructive. Until contract renewal.

The county sent paperwork. Both partners needed to sign to renew. Kitty started stalling. October 1st. Then October 15th. Then November 1st. Each time: “Thanks, I’ll take a look!” And nothing. I sent her an email. I tried to get my partner to reason with her (he is nicer than I am) but he didn’t want to approach her. At some point, we just stopped caring. If she didn’t sign the paperwork, the full contract would just go to us, right?

No, and this is what I didn’t understand.

Kitty who had worked in the County contracting office, understood perfectly — is that if both partners in a joint agreement don’t sign the renewal, the contract becomes void and goes back to public bid. She knew exactly what she was doing.

I got the procurement notice on December 1st. We had until February 28th to submit a bid. The new contract would start on March 1. We were still operating and hiring people for our upcoming spring break season. We had bookings all the way into April.

I worked so hard on trying to find a sweet spot of what we could bid (we knew it had to be over 20%) but still make money to pay our bills and our staff.

We submitted a bid number that we felt good about and waited.

On February 28th, we heard that we had been outbid by 2%. A new company that hadn’t been participating in the program outbid us.

February 28th was our last day in the park. I had to call our staff — people we’d employed for years — and tell them they no longer had jobs, effective immediately. Right at the start of spring break season.

I went to yoga class most mornings that month. Every time savasana came, I would just cry. I couldn’t help it. I was so sad at what we had lost and so hurt that Kitty would knowingly wish this on us and our staff.

What this actually cost us:

Luckily, we still retained our other location with the County. However, revenues dropped significantly. We streamlined our staff, our operations and our spending.

The hardest thing about this was the county had structured the entire bid process around one metric: highest percentage offered.

Not experience.

Not volume.

Not history.

Just the number.

The company that outbid us wasn’t ready to start by March 1 and didn’t even have a signed contract until April. We paid more in County dues at our singular location than the new company did. They didn’t have the history, the advertising, the plan to execute and the county didn’t care. This is not the way most concessionaire contracts are set up. But, unfortunately, this is how our County has set it up.

The lesson:

I feel like the biggest lesson is to not go into a joint venture without all the questions answered upfront. Kitty was so nice and sweet–she just wanted access to the park, just like us. Turns out, she was unwilling to mediate conflict but also very willing to sabotage our business. I still wonder if she has any guilt about it. She knew what she was doing and she was doing it to be mean.

If you operate in a park, on a beach, at a resort, or anywhere that requires a permit or concessionaire agreement — read the contract. All of it. Understand the renewal terms, the co-signatory requirements, and what happens if a partner goes silent.

The Outcome

Looking back, losing the bid was actually very good for us. We had a bloated payroll, we had been reckless with our spending and we were getting burnt out. Although it was so painful at the time, losing the bid made us pull back and really fine tune things. Our staff was fine–since it was the start of spring break, they were able to get work with other companies that were ramping up.

Now, two years later, we are back at that park. We won the bid this time (more on that later) and we have the largest spot again. We are better prepared and more careful with our business this time around. It was a huge lesson and as I have mentioned, hugely painful.

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