Democratic Underground Latest Greatest Lobby Journals Search Options Help Login
Google

What small businesses need to thrive:

Printer-friendly format Printer-friendly format
Printer-friendly format Email this thread to a friend
Printer-friendly format Bookmark this thread
This topic is archived.
Home » Discuss » Archives » General Discussion (1/22-2007 thru 12/14/2010) Donate to DU
 
Stinky The Clown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Dec-08-09 11:38 AM
Original message
What small businesses need to thrive:
"Customers"
Printer Friendly | Permalink |  | Top
Captain Hilts Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Dec-08-09 11:39 AM
Response to Original message
1. And govt-sponsored health insurance for their employees. nt
Printer Friendly | Permalink |  | Top
 
HughBeaumont Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Dec-08-09 11:43 AM
Response to Original message
2. Preferrably gainfully EMPLOYED customers.
Not "Business 101". Common SENSE 101.
Printer Friendly | Permalink |  | Top
 
napi21 Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Dec-08-09 11:47 AM
Response to Original message
3. That's what I've been saying for weeks! We are in a chicken
or the egg situation. Businesses wont or can't expand unless they have more demand for their products, and there will not be any big demand if people don't have any money! Giving additional loans to small businesses MIGHT help a little, ut not to expand but to borrow for P/R and inventory. I still think the only BIG thing the gov't can do is infrastructure improvements. That would put people to work & money in their pockets. Then they can buy things thus generating demand etc.........
Printer Friendly | Permalink |  | Top
 
safeinOhio Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Dec-08-09 12:15 PM
Response to Original message
4. If only small businesses could get a tax break
they could hire more workers. Anyone buying that statement, come see me about a great, once in a life time deal on a almost new bridge.
Printer Friendly | Permalink |  | Top
 
guardian Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Dec-08-09 12:22 PM
Response to Original message
5. Actually businesses need "profit" not "customers"
Edited on Tue Dec-08-09 12:23 PM by guardian
If business costs are so high that it can't make money on a customer then more customers won't help. Part of the problem businesses are having now is predicting what costs will be next year. Because of this even if they have the potential of new customers, owners are hesitant to take on any new business that will require hiring more people or buying more capital inventory/equipment.

For example, my Dad owns a small commercial laundry that provides textile rentals. Mostly linens/tablecloths/napkins to restaurants and the little entryway mats to cut down on dust/dirt. He is right on the edge of folding right now. Yes he could use more customers today. But he tells me his biggest worry is what will happen if his costs go up. Most of his customers are saying that they can't afford any price increase in his services. His 3 big concerns are

1. Energy costs. If they go up 30% - 50% - 100% due to Cap & Trade legislation this alone will crush his business. He'll have no choice to but to raise (maybe double prices) and most of his customers will drop his services rather than pay more.

2. Increased taxes. If taxes go up he can't make it without raising prices. Doesn't matter whether the tax is corporate, personal, federal, state, local, or called a "fee." It is still money out of his pocket.

3. Increased payroll or overhead expense to comply with new legislation.

If he folds, then his 9 employees are all out of jobs. He is one of the few employers in this rural area in an already depressed labor market. He pays well above minimum wage (typically $10-$12 hour for unskilled labor). People like to work for him because everyone else in town only pays $7-$8/hr for similar skills. Fortunately, he has saved and can afford to retire (he is 79). The only reason he doesn't close the doors now is that he feels an obligation to provide the employees a job. He is old and not in the best of health. Profits have already dwindled down to the point that there is almost no financial reason for him to keep things going. If things get worse what little profit he makes will turn to a loss, and he'll close the doors and liquidate the equipment.
Printer Friendly | Permalink |  | Top
 
theoldman Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Dec-08-09 01:40 PM
Response to Reply #5
8. My hat is off to your dad for still working at 79.
Edited on Tue Dec-08-09 01:41 PM by theoldman
I agree that profit is very important but without customers you have no chance of making a profit. If his customers say they cannot afford a price increase, where will they go? Are they going to do their own laundry?
Printer Friendly | Permalink |  | Top
 
guardian Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Dec-08-09 02:02 PM
Response to Reply #8
9. Are they going to do their own laundry?
Yes. Restaurants will wash their own tablecloths/napkins. It won't be as good but cheaper. You can tell if a restaurant washes their own stuff. If you notice that napkins have a slightly greasy feel/smell they wash their own. Commercial laundries use steam injection in their washers to get the water temp up over 185 degrees to break down the grease so napkins are "clean and fresh". Most home washer temps never get hot enough to break down the grease leaving the filmy feel.


Yes. Stores will buy their own rugs at Costco and wash them at home. Again you get a cheaper product with less carpet pile and the home washer won't come out as clean. But it is cheaper.

There is a price point at which people stop using your product. A little liquor store may pay $20 for carpet service but they won't pay $50. They will do it themselves.

Printer Friendly | Permalink |  | Top
 
taught_me_patience Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Dec-08-09 12:30 PM
Response to Original message
6. This is so true
Most people do not understand the fundamental tenet of finance:

If return on equity is lower than the cost of equity, then growth destroys wealth. Right now ROE is low because customers are not buying the same amount of stuff, so credit growth will destroy wealth.
Printer Friendly | Permalink |  | Top
 
Laelth Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Dec-08-09 01:33 PM
Response to Original message
7. Hear, hear! k&r n/t
:dem:

-Laelth
Printer Friendly | Permalink |  | Top
 
DU AdBot (1000+ posts) Click to send private message to this author Click to view 
this author's profile Click to add 
this author to your buddy list Click to add 
this author to your Ignore list Fri Dec 26th 2014, 02:04 PM
Response to Original message
Advertisements [?]
 Top

Home » Discuss » Archives » General Discussion (1/22-2007 thru 12/14/2010) Donate to DU

Powered by DCForum+ Version 1.1 Copyright 1997-2002 DCScripts.com
Software has been extensively modified by the DU administrators


Important Notices: By participating on this discussion board, visitors agree to abide by the rules outlined on our Rules page. Messages posted on the Democratic Underground Discussion Forums are the opinions of the individuals who post them, and do not necessarily represent the opinions of Democratic Underground, LLC.

Home  |  Discussion Forums  |  Journals |  Store  |  Donate

About DU  |  Contact Us  |  Privacy Policy

Got a message for Democratic Underground? Click here to send us a message.

© 2001 - 2011 Democratic Underground, LLC