Published 1:34 pm Saturday, March 28, 2009
Editor’s Note: This is part 3 of 5 in a series examining the effects of the recession in the Austin community
It’s 4 p.m., and the day hasn’t slowed a bit for Ed and Sue Wells, owners of South Main Auto Service.
The couple tends to customers picking up and dropping off vehicles. Mechanics are busy under the hoods of two sedans in the garage.
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The shop averages 20 vehicles per day, its six staff working on everything from minor jobs, like oil changes to major fixes, like head gaskets.
“This business is pretty busy,” Ed said. “People’s cars break — they got to get them fixed.”
South Main Auto is one of a small but very fortunate number of businesses thriving in this nation’s recession.
“I was worried,” Ed said of the frail economy’s effect on his business.
Last summer, the price of oil skyrocketed, and as a result, oil changes went up too, he said.
Some auto repair shops have reported that consumers are giving in to making major repairs on vehicles rather than simply purchasing new ones.
Ed still hopes business doesn’t take a dive as the recession continues.
“It still could, you know,” he said. “If you got to buy a new set of tires or groceries, I’d buy the groceries.”
Although the unemployment rate in Mower County rose to 7.3 percent last month compared to 4.5 percent in February 2008, retail has been holding its own. From April to December, retail sales rose 7.8 percent, as indicated by revenue collected from the half-cent local option sales tax. The tax was put into effect last April to generate funding for flood mitigation.
“I think our retail in this community is doing better than other areas of the country, as those numbers would indicate,” said Sandy Forstner, executive director of the Austin Area Chamber of Commerce.
“I think that is a reflection of the economy, which is agriculture,” he said. “Nationally, retail has declined.”
According to the Minnesota Department of Employment and Economic Development, Mower County’s unemployment rate may be the highest its been since before 1990 — the earliest year data was available — but it is still faring better than nearly every southeast Minnesota county except Olmsted.
“Unemployment is lower than some other areas now,” Forstner said. “That is why our retail sales remain more stable, and actually showed some improvement.”
Retail sales, Forstner believes, have benefited from consumers recognizing that buying locally supports the economy where you live. Also, the Chamber’s “Buy Mower, Grow Mower” campaign has signed up more than 1,000 people to make 10 percent more purchases in the county.
“I think during times such as this, people are understanding it’s important to support local people,” Forstner said. “Seventy percent of economy is based on consumer purchases.”
Many businesses in Austin have reported that sales may not be down, but they aren’t increasing, either. Some who have reported increases say they can’t determine whether or not it is a result of consumers’ changing buying habits.
At Hanson Tire Service, owner Bruce Turner said January and February are typically slow.
“It’s really tough to judge this time of the year,” Turner said.
Terry Falch, manager of the service department at Holiday Cars of Austin, said they have been “staying steadily busy.”
“Anything else would be flavoring it,” he said.
Falch said he rarely hears from customers they are giving in to making repairs rather than purchasing new, but did stress how vital it is that Austin residents buy in Austin.
“Buying ‘big tickets’ in town is important,” he said.
Forstner said that through the Chamber, he has been hearing that locally-owned banks, hotels, some restaurants and furniture businesses have been doing well in this economy.
Brick Furniture owner Steve Brick said he it still seeing his “regulars,” and that he feels fortunate about how his family business has been faring.
“I wouldn’t say it’s up, but it’s been very, very good,” Brick said. “Every day you worry about it, but every day’s good.”
He doesn’t know how sales have been affected now that Robbins Furniture has closed, but believes customers in the past couple years have changed what and how they buy.
“The trend I’ve seen over the past few years is, people want a little more quality,” Brick said.
For one unique market, consumer habits also been changing — but it has nothing to do with tough economic times.
Liquor stores nationwide have reported a huge trend in the number of customers looking for wine and asking questions about how to purchase it.
Brian Walstrom, manager at Hy-Vee Wine and Spirits, said his store has been doing remarkably well, and wine sales are a huge factor.
“I don’t think it’s economy related,” Walstrom said. “I think wine-makers are better at making wine.”
Beer and liquor sales have been steady, he said, but not as strong as wine.
“I think we’re going to continue doing well,” Walstrom said. “I guess you would call us ‘recession-resistant.’”
As we slowly move into spring after a long, bitterly-cold winter, area nurseries and greenhouses are keeping their fingers crossed for beautiful weather — soon.
“So far, our slow season is November through March,” said Jim Stiles, owner of Super Fresh, a bakery, produce and garden center. “As we get into April, we certainly hope things will bounce back.”
Stiles said sales have been down with the new Wal-Mart opening last summer, but a new influx of customers seeking chemical-free fertilizers, specialty products and personal service have him thinking positive.
“I can do that so much better than the big guys can,” Stiles said. “Small businesses can really shine buy making their products really neat, something you got to see.
“You’ve got to be optimistic,” he said. “About 50 percent of it is the weather.”
Stiles also sees a big interest in vegetable gardens this season as people stay at home rather than take big vacations.
Berg’s Nursery is anxiously waiting for temperatures to warm up and snow to be gone for good so residential and commercial landscaping projects will start rolling in.
“Right now, it’s not a big gloom-and-doom forecast for us, but we don’t know yet,” owner Randy Berg said. “We are kind of taking a cautious approach with pre-ordering product and so on. We make sure we don’t get carried away.”
Like Stiles, Berg said more customers are buying materials for vegetable gardening and other home projects.
“Times are tough, but people sometimes turn to places like what we do,” he said. “Staying home may take precedence over a big vacation. Sometimes when you can’t build a new house you do a couple remodeling projects.
“It doesn’t look awful,” Berg said. “We are cautiously optimistic. We’ve got a fairly solid economy locally.”