Small businesses feeling effects of grim economy
Some small local businesses are starting to see the shaky economy’s effects on their bottom line.
“It’s probably dropped off 50 percent,” said Doug Martin, co-owner of Valley Wide Moving & Delivery in Grand Junction, which has mostly done household orders since it opened in 2000. “With the way the housing market is, they’re not buying new houses, and if they are, they’re moving themselves rather than spending extra money to have someone move them.”
To anyone who says the chaos on Wall Street isn’t local, he says: “They must be working for the oil industry. I think that’s going to fall off, too. It’s all going to come around.”
Business owner concerns about the bailout and the credit crisis are on the rise.
“We’re getting an increased number of calls from small businesses concerned about the availability of credit,” said Jim Henderson, regional advocate for the U.S. Small Business Administration in Denver. “In some cases, they’re finding it more difficult to obtain. There’s definitely a concern that credit has tightened in the last few months, and, as far as I can tell from the bailout plan and the timeline, we’re still looking at tightening for at least another quarter or two.”
David Long, owner of Long Haul Trucking in Grand Junction, in operation since 2002, said timing is everything for the Grand Valley.
“As best as I understand it, what’s happening in our slowdown is running a year or so behind what’s happening in the rest of the country,” Long said. “It was late starting here because of the oil field giving us a local cushion and keeping a lot of people employed. It hasn’t been quite as drastic here as it has been other places. It’s catching up, but I don’t know if it’s going to get quite as bad.”
Long said he has noticed a definite decline in the lumber facet of his business. The decline is somewhat evident here, but much more obvious nationwide, he said.
“We’ve seen a definite slowdown in the lumber warehousing,” he said. “We’re not seeing as much lumber as we did last year. It’s kind of a funny situation. Because of fuel prices being so high, there are less trucks on the road. It’s put some people out of business. Along with that, the building nationwide has slowed down, so there’s not as much of those particular loads. It’s not a mix I’ve ever seen before.”
Long is holding off on making new vehicle purchases for his business until the outlook is better.
Martin he said hasn’t tried to get a loan recently, but said he has heard from other small-business owners that they have had trouble attaining loans.
Herman Lucero, who owns HRL Compliance Solutions, a small energy company in Grand Junction, said he hadn’t heard of others with trouble getting loans.
“I had lunch with my banker, and he thought everything was going really well with them,” Lucero said. “I haven’t noticed the impact of the credit locking up as everyone is saying. I am going to be meeting with my banker for a loan next week and see how that goes, but to date I haven’t seen it.”
Henderson said community banks that know their clients and know the strength of their communities seem more flexible about giving applicants loans for any number of needs, including covering payroll, inventory or new equipment.
Martin said regardless of the bailout or the credit crisis, his biggest concern is the slowing of business.