published Thursday, January 13th, 2011

As snow melts, cash flow solidifies for small business

  • photo
    Niedlov's Breadworks driver Jonathan Beam, left, works with assistant general manager Chris Williams to bag bread for Ankar's Hoagies. Niedlov's was back to their normal production schedule Wednesday, supplying bread for area restaurants, grocery stores and Niedlov's patrons.
    Staff Photo by Laura-Chase McGehee

The snowstorm of 2011 got an icy reception from small business owners, who said it had a chilling effect on sales.

With both employees and customers stuck behind impassable roads, sales plummeted along with temperatures in the beginning of the week, owners said. Some chose to stay open, while others took a much-needed day off.

Andrew Gage, owner of Velo Coffee Roasters, said he had to suspend on Monday his usual bicycle deliveries to local businesses because of piles of snow and closures.

"Everyone was closed early, even the banks," Gage said.

He resumed deliveries on Tuesday but because of icy conditions had to stick to the main roads.

As Gage dropped off coffee at Niedlov's Breadworks on Wednesday, retail manager Sarah Miller supervised the bakery's first full day of operations since the storm.

A single worker made it in Monday, and the retail area remained closed Tuesday, she said.

With few customers able to get downtown to buy bread, there was little point in bringing in others to run an empty store, she said.

"That's why we kept the retail area closed, although we were still doing deliveries," Miller added.

Bruce Hutchinson, professor of economics at UTC, said the total cost of the storm to small businesses will be considerable, when lost sales and added expenses are counted up.

Utility and payroll costs may not be offset by sales if customers choose to stay home, Hutchinson said, but if customers show up and the store is closed, they may never return.

"Life is always a tradeoff," he said. "The customers who go out of their way to desperately get there — they're not going to be happy if they make the heroic effort to get there and the store isn't open."

Breakfast restaurant Bluegrass Grille on Main Street is always closed Monday, but the weather kept the doors locked Tuesday, too, employees said.

On Wednesday morning, server Ashley Olinger waited tables by herself in the mostly empty restaurant. Part of the street outside and most parking lots were still covered by a mixture of snow, slush and ice.

"Normally, it'd be packed right now," she said as kitchen worker Floyd Swanson nodded in agreement.

"This is the slowest it's ever been," Swanson added. "There's usually a line out the door."

The restaurant must make at least $600 daily to break even though the store usually brings in closer to $1,000, said server Greg Worsham, who went home early Wednesday.

"I think they might have just broke even," Worsham said. "It was dead in there."

Steve Ray, owner of service station Midnite Oil, called the snow's effect on his business an "economic snownami."

"It's just a cashflow-eater," he said.

With few customers to serve on Monday or Tuesday, he asked most employees to stay home.

"You're looking at Monday with no business, then Friday as a payday, and they understand," Ray said.

Tuesday sales were at 25 percent of normal levels, though he began to see "a return to normalcy" on Wednesday, he said.

"Everybody's checks are gonna be light this week, but hopefully this weekend we can work extra and make it up," Ray said.

about Ellis Smith...

Ellis Smith joined the Chattanooga Times Free Press in January 2010 as a business reporter. His beat includes the flooring industry, Chattem, Unum, Krystal, the automobile market, real estate and technology. Ellis is from Marietta, Ga., and has a bachelor’s degree in mass communication at the University of West Georgia. He previously worked at UTV-13 News, Carrollton, Ga., as a producer; at the The West Georgian, Carrollton, Ga., as editor; and at the Times-Georgian, Carrollton, ...

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