Foreclosures High - Small Businesses Suffer Too

The US economy is going through a turbulent phase. With the recession has come the job loss. Subsequently people are faltering on mortgage payments. Their houses are being taken over by banks and foreclosures are common. A recent trend that is being noticed is that even small businesses are suffering because of the downturn.

A survey was conducted on the Chinese, Latino and Vietnamese entrepreneurs in Oakland and San Francisco. La Palma Mexicatessan is one of the busiest outfits on 24th street. The outfit is famous for its tortillas which it sells to restaurants. Grocery items are also sold from here. The owner of the store, Mario Castano says that customers are not buying food from outside. They are finding it a better alternative to cook at home.

The dry cleaning business has also taken a hit. Most of these businesses, being owned by the Chinese Americans, are running at a loss. Betty Chan, who owns Rainbow Laundry, says that a majority of his customers have been laid off. They no longer need to iron and clean their suits. The business has dropped by 30 per cent subsequently. Michelle Zhu, who owns another laundry business, says that customers come to the shop only before job interviews. Zhu says that the business has perhaps hit the trough. It has never been as bad in the last 12 years. Zhu says that most of her customers have migrated and she no longer sees many of them.

The impact on a cleaning business depends on its location. The impact is more severe if it is close to the financial district. Jack’s Dry Cleaning business has seen a 10 per cent plunge. Cleaners also say that the customers are making lesser requests for ironing clothes too. Discounts are being asked by customers more frequently. Zhu is giving his clients at least 5 per cent discount. After all business is down and most are willing to cut back on laundry services.

When customers complain of shirts being not clean enough then Chan readily does a second wash. She just cannot afford to lose any of her clients. Most of these small-time entrepreneurs have stopped splurging on dinners outside.

The parlor business has also been hard hit by the downturn. The owner of Susan’s Nail and Spa in Oakland, Susan (Xuan) Le, says that her business has hit a hard patch. Whereas earlier, the entrepreneur used to make $200-$300 a day, her earnings now dropped to $10 a day.

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