Tuesday, January 11, 2011

Hibernation

Best thing a small business located halfway between the High Desert and the Cascade Mountains can do between Jan. 1 and July 1, is go into hibernation.

No way around it. Bend is seasonal. It's the Faustian bargain we made with the tourism industry. But, hey. We could be subsisting on government checks, like Burns or John Day. And not that we had a whole lot of choice. We can dangle Juniper Ridge in front of outside industry all we want, but it was always going to be an uphill task to get industry to move here, and in a recession, I suspect all but impossible.

We've got our guestroom all fixed up -- now we're just waiting for guests.


Are you guys going to let me get away with such sweeping statements? I welcome disagreement, I want to get some discussion going.


My feeling is that we just have to grin and bear it. This is going to take time, here in Bend, much longer than just about anywhere else. Too many houses, too few jobs.

For many businesses in Bend, the Boom was the "norm." If a business opened anytime between 1995 and 2008, the Boom was the majority of their existence. The years between 2002 and 2008 would seem the proper level, the years before that maybe would seem 'start-up' levels, and the years after would seem to be an unfortunate recession.

The "norm" to me would be more like the 1990's. Nice growth, but still a struggle. Not so bad as the 80's, not so great as the 00's.

So when the 00's came along and started booming, I figured it for a lucky streak, tried to take as much advantage of the extra boost as possible, but never expected it to continue. I expected to end at any time.

And when it ended, I figured -- if we were lucky -- we'd settle back into the 1990's rate of growth.

So far, it's been more like the 80's. (As bad as the Great Recession is, I'll submit that the mid-80's were much much worse for most of Bend, especially downtown Bend.)

The 90's level of business looks like UP to me.

I'm talking percents of drops and increases, here. Even now, my overall level of business is much higher than most of the 90's. (But, so too, are my costs.)


On the more immediate front, despite having a good December, I'm expecting this next six months to be the slowest of the recession yet.

Sept., Oct., and Nov. were all down, and a good rule of thumb for me is to expect Jan. and Feb. to be worse, and April, May to be not much better.

I did average business the first 8 days of the month, but the last two days have been ultra slow, and I'm really not expecting much the rest of the week. Trouble with doing average, is that slow days can drag down the average, and we need the occasional really good day to bring it back up.
That's the part we're missing.


The problem is compounded by the paltry offering from DC and Marvel, In Their Infinite Wisdom, Glory Be, the Masters of My Fate.

While I like the lowering of prices, it's going to hurt in the short run. And not releasing much is only going to make it tougher.

Then again, I'm well prepared. That's the whole trick. Be ready for it.

3 comments:

Bend Economy Man said...

A big danger I see is that in the meantime, while we're waiting for a "recovery", whatever that might mean (given that almost everyone agrees that the boom isn't coming back for a long long time), Bend just stops being an "upscale" town: poorer people move in, existing rich people become poorer, new rich people don't move in, no money for upkeep, town starts to look shabbier and shabbier, etc.

I just don't like Bend's size: too big and established to be cute or undiscovered, too small and underdeveloped to have a sustainable economic base that can weather the storm.

Coming out of the '80s slump Bend was small enough that it just needed a touch of paint here and there, figuratively speaking, to make it presentable. All the rest was new development and dismantling the industrial sector. Now the town's bigger and development got ahead of itself - have too much residential, too much retail. All of that needs constant upkeep or you have a recipe for some ugly blight.

Duncan McGeary said...

Bend housing prices hit a 5.5 year low, thus outlast my advice a few years ago of "Wait two years to buy a house."

Anonymous said...

Juniper Ridge is an interesting idea.

However, it may not be the best way for the region to grow and create quality jobs for central Oregon. It is like hunting elephants to feed the family and passing up all the mule deer. Not alot of elephants here and herding elephants into the area is more pure luck and more likely to happen by using massive government sanctioned bribery.
( for example facebook in crook county )

At this point both tenants of Juniper Ridge were moved from else where in the immediate region. Not what I would call creating jobs, just rearranging the deck chairs on the Titanic.

So what does central Oregon need?

We need to look long term and encourage the growth of small businesses that build, create ideas, or create information and ship it out of the region, state and country.

There will not be an instant cure. The successful small companies with good product(s) take time to grow. think Deschutes Brewery, Bend Research, PV or g5. And a bevy of others along these lines.

A diversified business community will always be more vibrant and sustainable than one that is overly reliant on tourism/recreation and construction.

We have to grow these build it here and ship it out of the area businesses. It starts with local support.

So just a rough idea... Maybe away to proceed.