Downtown coping with triple whammy

Published 6:47 am Sunday, July 12, 2009

Contributing Editor

The owners of one Washington business are working downtown and out of town in an effort to keep their downtown shop’s doors open.
“We wanted to keep the shop,” said Pat Rogers, who along with her husband, Kim, owns Shabby Chic in downtown Washington. Rogers said she and her husband have taken outside jobs to help make ends meet.
Shabby Chic, which sells antiques, collectibles and gifts, is feeling the effects of the recession and increases in rent, fees for business-privilege licenses and electric rates, Rogers said. So much so that she and her husband work four days a week as merchandisers to supplement the income their shop provides.
Compared to last year, sales are down from 50 to 60 percent this year, Rogers said. On top of that, the couple, who live downtown, are paying someone to run their shop on South Market Street when they are working at their merchandising jobs, thereby increasing the shop’s overhead.
“We’re hanging on,” said Rogers.
“I love this. If I have to close my shop, it will kill me,” she said. “We’re keeping afloat. … I don’t know how long we can do it. We’re just going day to day.”
Other downtown merchants said they are facing many of the same issues.
The recession, increasing electric rates and rising insurance premiums are several factors increasing the cost of doing business at the same time revenues are decreasing.
The triple-whammy is making it more difficult for businesses to make a profit, said Glenn Weatherington, one of the owners of the Down on Mainstreet restaurant. So far this year, sales at Down on Mainstreet are noticeably less than they were at the same time two or three years ago, he said.
“We’re having to cut back on some of the employees’ hours, and we’re (Weatherington and his wife, Gennia) working more,” he said.
Jean Thompson, owner of the gift shop Cat Bamboo, said she too is dealing with the recession and increasing expenses.
“The electric rates are horrendous,” she said.
Increased overhead expenses combined with a sagging economy this year to hurt merchants, said Russell Smith, owner of Russell’s Gentlemen’s Clothing. The possibility of the state Legislature increasing the state’s sales tax could make a bad situation even worse, he said.
“I think all that has an effect,” said Smith, who’s been in business downtown for 26 years.
Smith said he’s reduced expenses by working by himself at his store more than in previous years and not relying on part-time employees as much.
Rebecca Franks, owner of A Slice of Heaven, a dessert, tea and coffee shop, said she’s not surprised her business is off as a result of the recession.
“I’m a luxury item,” Franks said.
Franks said she also is being hit by the increases affecting other businesses.
“The cost of my ingredients have gone up. I’m keeping my prices the same because my customers can’t afford for me to increase them. … I’m keeping the prices the same so they can still afford to come in,” Franks said.
Gary Tomasulo, president of the Historic Downtown Washington Merchants Association, said he can’t understand why the city — during the past year and in a recession — increased electric rates (twice) and fees it charges for business-privilege licenses. Doing so doesn’t provide an atmosphere conducive to helping businesses, he said.
“To me, that makes no sense,” he said. “The city should be looking for ways to help merchants, not add to their burdens. I know the business owners, since January, have been doing very slow business,” he said.
Four downtown businesses have closed since the first of the year, but two new businesses have opened since then and three are getting ready to open, he said, including his La Bella Pizzeria, which was slated to open last Thursday.
Smith believes he and his downtown colleagues, at least the majority of them, will survive their current predicament.
“I think the merchants are doing what they need to do to make it work,” Smith said.
Thompson, owner of Cat Bamboo, believes she is one such merchant because she keeps her shop open seven days a week.
“My mantra is show up on time, dressed to play the game. That’s what it is — a game to make the money you need,” Thompson said.