While this summer has seen stock markets plunge, consumer confidence crater, and hopes for a broad economic recovery evaporate, several members of Ocean Beach’s business community seem cautiously optimistic about the future.
Gary Gilmore, owner of Gilmore Family Jewelers on Newport Avenue, has noticed a slight upturn in customer sentiment in recent weeks.
“There’s a little more of a positive attitude right now,” Gilmore said. “All of a sudden, I sold some major pieces.”
Gilmore believes the local economy is coming off a bottom — and he’s grateful that his business has endured the last few years.
“I’m selling a luxury product during recessionary times, so it’s been tough for me,” Gilmore said. “I don’t know if I’ll ever go back to the 2006, ‘07, ‘08 days.”
Gilmore has worked with his daughter to appeal to new types of customers, including younger people who might prefer less expensive, more modern jewelry.
“You can’t wait for people to walk in the door anymore — you have to be in tune to what’s going on,” Gilmore said. And now more than ever, when customers are in the store, “you treat them like royalty.”
Two doors down from Gilmore Family Jewelers is Ocean Beach Hardware, where owner Carl Weidetz also said he’s noticed that business is “starting to pick up.”
Traffic on Newport Avenue seems to be recovering from disruption caused by recent roadwork in the area, Weidetz said. In addition, customers seem to be investing in bigger projects again instead of fixing only what absolutely must be fixed.
Weidetz has also been encouraged by the arrival of new neighbors in and around Newport Avenue. “We’re starting to see some smaller individual shops moving in, and that shows a lot of confidence in the future,” he said.
The loss of easy access to credit has been “the big kicker” since late 2008…
In addition to confidence, entrepreneurs need credit — and according to Denny Knox, executive director of the Ocean Beach Mainstreet Association, credit is still crunched.
“There are very few options for small business people other than cash,” Knox said. Loans, if available at all, tend to come with interest rates starting in the high teens, but when it comes to return on investment, “this isn’t even a 10% world right now.”
The loss of easy access to credit has been “the big kicker” since late 2008, Knox said. For example, many small businesses used to rely on credit cards for short-term financing. When the crisis hit, however, many cardholders were floored by a 1-2 punch of shrunken lines of credit and dramatically higher interest rates.
Knox called the lack of short-term credit “a failure of the marketplace” that has left small businesses hamstrung in recent years.
Indeed, credit concerns recently led long-time Ocean Beach locals Pat and Susan James to seek new owners for James Gang Graphics on Bacon Street, as the OB Rag reported in March.
On June 1, the business was taken over by a group that includes several long-time employees.
“The community has very much embraced the fact that we kept The James Gang going,” said Leigh Ann Bearce, a member of the new management team.
Roger Lovett, who with his wife Yasuko has owned Bernie’s Bicycles since 1989, says business is booming at the Bacon Street shop.
“We’ve been busier than shit,” Lovett said, adding that the strength has come more from repair work than sales of new bikes. He said he thinks tougher economic conditions are a boon for bike shops like his because bikes are an affordable transportation alternative.
“The global economic crisis is actually good for us,” Lovett said.
Of the half-dozen Ocean Beach businesspeople interviewed for this article, only Liz Huffstutler of The Village Kitchen seemed less than enthusiastic about business in the days ahead. A waitress at the restaurant for more than 20 years, Huffstetler has seen regular customers slow the frequency of their visits since the 2008 crash.
“We have seen new faces coming in,” she said. “The last couple years,” though, “it’s been kind of going down.”
Huffstetler said rent for the restaurant — located between Gilmore Family Jewelers and Ocean Beach Hardware — has increased significantly over the years. She said The Village Kitchen’s owner, her father, rents the space and might not renew the lease again.
“We’ve had 24 good years here, so if it’s time, it’s time,” Huffstetler said.
…shopping locally could have a compounding effect on local economic growth…
Knox at the Mainstreet Association said the broader economy’s doldrums date back to the tragic events of September 11, 2001.
“Business has not been fabulous for most small businesses in the last 10 years,” Knox said, though the Ocean Beach economy may have fared better than the economy in general. “I feel like we had far fewer vacancies” than other neighborhoods, Knox said.
Outside of the traditional summertime expansion of payrolls at restaurants, which employ most workers in Ocean Beach, “hiring is pretty flat” now, according to Knox. She said she was sorry to see permit problems close The Joint, a new restaurant that had been expected to employ a couple dozen people in the old Little Chef location at Newport Avenue and Cable Street.
Knox reminded area residents that shopping locally could have a compounding effect on local economic growth as owners and employees of area businesses reinvest their proceeds when they pay rent, eat at nearby restaurants, spend on local entertainment, and so on.
“It really is a self-fulfilling prophecy,” Knox said.