Sunday, February 17, 2008

"Too Big for Our Britches."

"Supply and demand imbalance."

"Close to saturation."

"Some will move here with half-formed dreams of economic success, then fail and move away."

Nice phrasing.

I'm not a redneck, I don't think, but I admit to being a reverse snob.

Eat the Rich!

I cringe when I read about a 'personal chef' who's going to New York for vacation, and who has lived in Bend for all of six months, (and specifically mentions she buys on trips and online, but no worries, she drives to Redmond to buy beef jerky!) Somehow, I doubt she's a working stiff.

I've got to be careful here, because half my possible readers probably drive SUV's and live in McMansions, but, really, I hope if I ever have enough money, I'll be more socially responsible than worrying about if I have the right 'brand' of kichenware.

I'm always torn by this; I understand nice, quality things. Maybe it's the tone of seeming smugness I read. Our town really does seem to be turning into a town of have's and have's nots. Linda and I probably trend somewhere in the middle. Strictly middlebrow.

Much of the disdain for Californian's we see in these blogs come from the sheer ostentatiousness of it all.

I feel for Dianne down my block at Kitchen Complements. I've always felt our two stores are similar in scale and experience. I think it is a real working store, run by a woman who lives off of it. I'm trying to imagine how I'd feel if a 6400 sq. ft. store selling what I sell opened in the Old Mill.

Dianne uses the words "I just see the dollar being cut that much more." Rudy at Newport Market says, "I think we're getting close to saturation."

Close to saturation. No kidding. I mean, this is really throw up your hands in exasperation time.

Hell, the rent (and fees) alone of this new store in the Old Mill have got to be over 15,000 a month! (Break-even to pay rent at 50% margins, 30,000 in sales for rent alone.) That is an insane number unless you are a major chain, and can subsidise it. My guess, this is a major chain in the making wannabe with a huge amount of money borrowed or invested.

I think we've definately gotten too big for our britches. I mean, come on people!
Cry uncle! Enough, already.

We are so out of scale here, that I don't think anyone can see it anymore.

I'm trying to envision a future in Bend where there will be enough business for all these stores. And no matter how I do the math, I come up short, by a minimum of half. We've reached a crazy level, folks. And -- though I never comment on restaurants because I don't know their economics -- I'm going to venture a guess they are out of control also.

Looking at the two beautiful new bookstores in Redmond. Nice looking stores. And at least one too many of them. Same thing in Bend. Three nice stores, and probably at least one too many.

I know, for instance, that we couldn't even support one sport card shop. One game store. One anime store. We seem to be able, barely, to support one comic shop, two used bookstores, etc. The dynamics in the area's I know something about haven't changed all that much -- sure there are more people, but they are buying from the big boys apparently, because none of the existing stores are getting rich.

What all the surge in population has done in my store is make it more likely that people will stumble into my store -- so, what, maybe 15% of my sales can be attributed to people I don't know, up from say, 10% a few years ago?

It just doesn't compute.

I wish someone would calculate the square footage of retail in Bend, because I think it would be an eye-opening number.

Turning to the in-migration article in the Bulletin, I'd like to quote the owner of the local Atlas agent City Moving and Storage Co. "We had some things going last year, but jeez, there's nothing going on this year," Perry said, calling this year the worst winter he's seen in the local moving business since the early 1980's."

Which if you were around in the early '80's is really saying something. It's a bit of refreshing honesty from someone affected by the housing slowdown who doesn't need to mince words.

"You could almost go to sleep and not miss anything, so it's bad. Whether it comes back or not is anybody's guess."

Meanwhile, I was talking to a local developer on Friday who had been in the local office and said that only 3 housing permits and 3 commercial permits were being currently processed. That, my friends, is a number that is hard to believe. "Are you sure?" I queried. He just nodded. "Yep."

And again, of all the big boys out there, only Brooks Resources seems to be willing to give us a reasonable estimate. (As I pointed out late last year, I think Brooks was well ahead of the competition in getting their house in order, so to speak.)

"...home prices may have to work their way back roughly to 2003 levels before the market regains some semblance of supply-and-demand balance." "That would bring median home prices in Bend back to the mid-$200,000 range." If I'm not mistaken, that is a one/third drop. This is an actual builder, talking.

So much for Best Time to Buy in 20 Years.

Supply-and-demand balance.

That's what I'm talking about! There's been an imbalance in the housing market.

What scares the crap out of me, is that the commercial imbalance is even crazier. We are a high desert town, isolated, no interstate, no real four year college, no major industry, dependent on building. Yeah, that should really work out well for us in a major downturn....

"Meanwhile, Nancy Lynch who's owned local United Van Lines since 1981, said she expects the migration patterns to continue,even if they happen in reduced numbers."..."Some will move here with half-formed dreams of economic success, then fail and move away."

Some will move here with half-formed dreams of economic success, then fail and move away.

These are delicious quotes. An absolute feast of reality checking observations. I love it.

"...the ones who have either brought jobs or money with them -- or both -- have the best luck sticking." Yes, Bend is very good at sticking it to them. Bring your money and your jobs and your 'half-formed dreams of economic success.' Otherwise, we're doomed.

The Bulletin still cushions the bad news between feel-good starting and ending paragraphs, but the blog fodder is there for anyone actually reading the meat of the articles.

And it's only February.


Bend Economy Man said...

It's tough to see how the Chamber of Commerce / COBA / COAR / mortgage brokers "Best Buyers Market in 20 Years" p.r. campaign is going to be effective if Brooks is out there in the Sunday Bulletin telling the world that prices need to come down another 30%.

IHateToBurstYourBubble said...

Still, retailers should be worrying about a real long-term threat: the Internet.

Who have I heard say that before?

Duncan McGeary said...

It's funny how mild mannered my blog reads after reading yours, Paul-doh.
Mine hardly qualifies as a rant at all.

I wanted to point out the Coba campaign to you about 3 weeks ago, because I knew you would nail them to the wall. Then I could've taken credit for it....

Should have known you'd pick up on it.

Even if the campaign succeeds -- which it has not chance, it's a non-starter -- I predict it will hardly be mentioned in about five months.... --even if they succeed, it would drop the I.Q. of Bend by about 20 points.

Duncan McGeary said...

I see where you define rant. I don't qualify, I guess. Need to ramp up the fuck words, I guess.


I thought I fuckin had it.

Duncan McGeary said...


I think Brooks considers themselves above and beyond the other developer nimrods.

And, like I said, they are in a similar position to me -- we've prepared for the worst, and we're just waiting for it to happen.

The others are still in denial, moving into the anger phase (damn friggin media! ^$^^&*

Duncan McGeary said...

I'm thinking the right strategy would be to sell out to a Californian. But then, the locals who have been here for a couple of decades are the least likely to want to leave.

Just a thought.

I just don't get the gourmet thing. Food is fuel, for me.

Going out to dinner is the electric bill. I put together sandwiches every day for work, and drink lots of water. (well, flavored water, cool-aid).

I mean, I enjoy the fine restaurants when I can afford them (which is when my extended family pays for the holiday meal, or something.) I can't imagine eating out so much.

I love the art I see -- but it all seems about double the price I'd be willing to pay, even if I could.

If this town falls down the way I think it will, there are going to be a whole lot of these places disappearing in the middle of the night.

Carl said...

The quote by Newport Market Rudy is close to what I am observing at his market. Lately the formal high times of the day, when you had to fight to get a parking space, are now easy parking right up front.

Resturants are also easier tog et reservations. Might be just me, but I think others might be seeing the same thing. People are/have pulled in their horns in Bend.