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Wednesday, 05 January 2011 20:22

Taking tabs on economic recovery: Economic situation in WNC seems to be improving for small businesses

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By Colby Dunn and Quintin Ellison • Staff writers

Despite a sour economy, many businesses in Western North Carolina are not only surviving — they are thriving.

Take Krismart Fashions on East Main Street in Sylva.

While many stores have seen sales decline and continue experiencing downward economic spirals, Krismart Fashions in October enjoyed its best sales month ever in the store’s 40-year history. December, too, showed promise: sales were up 20 percent.

Libby Hall, who owns the store with business partner and sister Jeannie Kelley, credits a diversified inventory featuring quality clothing at reasonable prices, a willingness to work hard, and — most importantly — the loyal support of clientele who make purchases here because they want to see Krismart remain open and do well.

“We are in a niche that hits all income brackets,” Hall said between ringing up purchases from customers eager to take advantage of a sale on New Year’s Day, when Krismart’s and a restaurant or two were practically the only small businesses open in town.

The customers that day reflected the store’s product diversification. Mostly women, in this slice of time ranging in age from 30-something to, perhaps, their late 70s. A sales staff was on hand to offer fashion suggestions and keep everything moving briskly at the cash registers.

It wouldn’t be accurate or fair to paint the economic situation as an all-is-absolutely-rosy picture if only business owners work hard enough, or to ignore the reality that many astute small-business owners have seen their stores go under despite Herculean efforts to prevent just that. But it’s also true many mom and pop stores such as Krismart are doing just fine.

SEE ALSO: Situation still bleak for builders in the region 

Just ask Rob Willey, owner of High Country Style in downtown Waynesville.

He won’t say everything is peachy; 2010 was still a hard year for the upscale women’s boutique. But still, they’re making it. They even opened a new store in Asheville and started offering online sales to serve the large portion of their client base that spend part of their year living away from the stores’ mountain locations.

Willey said 2010 was actually better than 2009, especially the Christmas season.

“For us, business was better as far as overall sales,” said Willey. “People seem a little more willing to spend money this year.”

The last quarter, he said, was promising, and he’s cautiously optimistic that next year will continue to improve. Still, he’s not resting on his laurels; they’re focusing on online sales and improving brand image and customer service to stay relevant and profitable in what are still very tough economic times. But Willey said he feels like those efforts have served him well, and he’s confident that they’ll continue to do so.

“Overall, you know, it was a good year,” he said of 2010. “Not a great year, but still a good one.”

Across the street, Tammy Moseley, manager at Laughter Jewelry, is wishing that the bad economy would stop getting so much airtime. She realizes, of course, that not everyone is having an easy time of it, she said, but churning up fear in customers isn’t going to make them come back.

“It’s just fear, and I don’t know if confidence will be back today or this year or next year,” Moseley said. “Hopefully it’ll be back this year.”

Moseley and her store are 17-year veterans of the Waynesville retail scene. As for 2010, she said it wasn’t the banner year that 2009 was for her store — she, too, was unimpressed by Christmas sales — but in the grand scheme of the store’s history, it was still decent, still profitable.

“You always hope for the greatest year ever, every year,” Moseley said, but it was still a good sales year, and her outlook for 2011 is cautiously optimistic.

And, despite all the dreary financial news, startup businesses also abound. The entrepreneurial dream lives on in WNC.

 

Getting a handle on what’s happening

Linda Harbuck, executive director of the Franklin Area Chamber of Commerce, has seen the chamber’s net membership, year-over-year, decline by 33. Despite the drop, Harbuck, along with many other business experts in the region, felt the situation began to improve in the latter part of 2010.

“The year ended better than it began,” said Harbuck, citing business startups and expansions.

The Buzz Bus in Cullowhee, a cab service of sorts that ferries Western Carolina University students back and forth from Cullowhee to the bars and restaurants in Sylva, started making runs in October. Franklin resident Tim Crabtree, who owns the business with brother Sam, believes they’ll survive and make their dream of small-business ownership come true.

“Right now, we are just covering costs, but we are picking up business,” said Tim Crabtree, who added that the holidays have put a crimp in the new venture, because his student-customer base hasn’t been on campus for much of the time the service has been offered.

Chris Wilcox is also a new business owner, though he bought a beloved community mainstay with a built-in clientele when he took over City Lights Bookstore on East Jackson Street in Sylva from founder Joyce Moore. Wilcox bought the store about a year ago.

Monday, with the help of a group of volunteers, staff and Wilcox’s mother, Margot, the store closed its doors to customers so that a physical inventory of the 5,000 or so books could take place.

Margot Wilcox does the bookkeeping for her son. His first year has been promising, she said, and the financial future of City Lights Bookstore seems sound. Her son agreed, crediting Moore’s work to build the store as a foundation he can work from.

“Incremental changes,” Wilcox said, is what he’s looking at. Such as offering Google eBooks, so that his customers can shop locally for digital media. City Lights Bookstore has offered ebooks through its website for several years, but Google eBooks, Wilcox said, expands what the store can provide — and helps him compete against corporate-owned bookstores and websites.

Interestingly, another independent bookstore with a different business model is also finding a strong, loyal customer base. The two-year-old Millie and Eve’s Used Bookstore in Franklin, located on U.S. 441 a few miles south of the town, is defying conventional business wisdom and finding it can compete with the big boys.

Eve Boatright and business partner Millie Griffin have a simple financial formula.

“If there’s no money at the end of the week, we don’t get paid,” said Boatright, a transplant from Britain, just outside London.

But they are making it financially, and doing it by offering 62,000 used books through trade (plus offerings by local authors). Additionally, to help drive traffic into the store, the women accept payments for Verizon and Duke Power. There is a Civil War section, classics section, children’s section as well as more conventional offerings such as mysteries and romances.

In neighboring Swain County, several new stores have sprung up and are making a go of the gifts market in Bryson City.

Robert Hoyle is the proprietor of one such establishment. He and his wife decided to open up Nannie’s Country Store on Fry Street in downtown Bryson City, which they bill as “a slice of country life.”

Hoyle and his wife moved to Bryson City from the Atlanta area after their kids were grown and gone, and have started the store as something of a retirement business venture.

The shop sells local gifts and crafts along with novelties and a few other odds and ends, and while Hoyle said he hauled in less this Christmas than he’d hoped, he’s still optimistic about next year’s outlook.

“It was difficult, with all the opening expenses, but it was successful at the same time,” Hoyle said as he looked back at 2010. “In this climate, people are not spending money, they’re just not. But I’m hoping that we do very, very well [in 2011]. We have a lot of new business ideas, some of the business ideas no one in Bryson City has. Hopefully, this next year will be great.”

Just around the corner on Everett Street, Lance Holland is also finishing his inaugural year in the retail business with his gourmet food and gifts shop, Appalachian Mercantile. Holland, too, was disappointed in the Christmas season, but has decided that, overall, 2010 was profitable enough to warrant another year on the lease.

He’s no stranger to the retail industry – his wife is in charge of retail operations at nearby Fontana Village – so he started the venture on a one-year trial basis. And while he said it couldn’t be called a banner year for sales, it’s been decent enough, especially considering that he opened in the grip of an economic slump.

“This is a brand new undertaking for me, and I’ll have to say that I’m kind of enjoying it,” said Holland. “It seems like the economy’s kind of finally turning around a little bit, and if I didn’t think it was going to be a little better, I wouldn’t be continuing.”

He said he’s hoping, too, that once word gets out about his gourmet offerings — which include a range of items from sauces to sweets — that it will become a bigger draw, possibly boosting his Christmas sales next year.

Not all newcomers are finding it so easy, though. In Canton, Johnetta Heil, who owns the Plaid Sheep Yarn Shop, said she too was disappointed with Christmas, but the rest of the year was a pretty mixed bag for her new business as well.

“It’s been up and down,” she said of the year overall, but she’s hoping that 2011 will give her the increased exposure she said her store needs to boost sales.

“People just don’t know I’m here,” said Heil. But she, like Willey at High Country, has been changing her business strategy to fit the economy and draw in more customers. She’s adding new classes monthly and is planning a camp this summer to get local kids interested in fiber arts.

David Huskins, head of the seven-county regional tourism group Smoky Mountain Host, headquartered outside Franklin, said the tourism industry has faced serious challenges beginning in 2008 and continuing through 2010. But not all is gloomy for this important leg of WNC’s economic chair.

“Our members have shared anecdotal information — they don’t like to give out their numbers, but will give a general impression — that verifies that at best the region has been flat in the tourism economic sector in 2010 compared to 2009 and 2008, which is actually a positive,” Huskins said.

Two vitally important regional businesses, The Great Smoky Mountains Railroad and Nantahala Outdoor Center, are reporting revenues increased year over year. The railroad, Huskins said, is upwards of 15 to 18 percent, though ridership is relatively flat.

“The revenues are up because of some creative repackaging they did this year with their first-class ticket sales and some creative online marketing they implemented to promote the first-class ticket,” he said. “NOC is reporting great success with its new retail outpost in Gatlinburg, which opened early last spring.”

Like Harbuck, the head of Smoky Mountain Hosts said he believes the economic situation began improving toward the end of the year.

“While we don’t have figures for 2010, our members have indicated generally ‘flat’ numbers compared to 2009,” Huskins said. “There is evidence of an upward trend in numbers and revenue this year in October and continuing through the first two weeks of November, which most of our members have indicated was perhaps the best since 2007.

“Going forward, we are optimistic that 2011 will see improved numbers in the region’s tourism economic sector, albeit only slight improvement. We will trend as the entire state does and the nation does. Our concern is with reports that gas prices will approach the $4.50 to $5 per gallon range by late spring-early summer 2011. We are a drive market and if that happens, it will be significant.”

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