Sorry for letting so many days (or has it been weeks?) go by since my last post.
I’ve been incredibly busy for the last five or six weeks. Since I have not been working at Intel at night, I’ve been trying to get caught up on some projects around the shop, at home, and spending time with Tracy and the boys.
We have had a good summer, mixed with some fun with the boys and lots of hard work with the shop. We went to Disneyland in June, we went to the Renaissance Festival, we’ve been to some baseball games, the boys played baseball in little league, we’ve been swimming quite a bit at the YMCA, Jonah and Ethan both got new bikes (we are a family of five and we have 11 bikes!!), Jo Renda (my little sister) is coming to visit next week, and we are going to Elitch’s (an amusement park in Denver) in two weeks. The kids start school again on August 18th and we have been getting ready for that. I finished building loft beds for all three boys, and we moved their dressers under them. That included emptying their dressers and getting rid of worn-out and out-grown things. We have a 30 yard dumpster in front of our house right now. We are getting rid of lots of landscaping debris, trees, and other junk we have accumulated over the last 13 years (Tracy and I are both pack rats). We also ordered new windows for the front of the house and they will be installed in the next several weeks (including a really cool bay window in the living room). We plan to install new windows in the back of the house next year. We had planned to repaint the outside of the house this summer, but that is not looking very likely…
As for the shop, the construction has proceeded with the building remodel and our end of the building is finished! The framing is complete, it has been skinned, and the stucco is done. It really does look great. It took 10 weeks longer than promised, and those construction impacts have translated to no growth at the shop. Fortunately, we have not really seen an overall drop in sales on a monthly basis, but we have seen definite impacts on certain days. When the entire front of the building was covered with scaffold, it looked like we were not open. We had some really slow days during that time. Other strong days made up for it overall, but we should have seen growth this summer and did not.
Currently, the façade work is finished, but we do not have any signage. The owners have obtained quotes for new signs and they want to charge us for 50% of the cost. We are fighting that. We had an operational lighted sign, which they took down and threw away. I feel it is their responsibility to replace it. I need to set up an appointment with the property manager and review the lease with regard to signage. That will be the deciding factor… In the mean time, the new sign will cost $4000, and we just don’t have that kind of cash to spare right now.
The $4 gas and the doom and gloom reporting on the economy have not helped either. Once again, we have not seen a slide in sales, but the vital growth we are looking for to get us over the hump has not happened. We have been operating most of this year right under the break even point. If we miss breaking even by $200 to $400 a week, it does not seem like a huge deficit. Over six months, though, it has a huge impact on our operating capital budget.
The bottom line is that we are finding ourselves to be a little cash strapped. We have some assets we can liquidate and come up with another $15,000 for operating capital pretty quickly. We can also sell our remaining rental house and come up with another $15,000 to $20,000 in operating income. Now comes the time for tough decisions. Do we expect for the gas prices to go down and for news on the economy to get better? If so, it makes sense for us to invest additional $$ and ride out the undeclared recession. If we do so, and things don’t get better, then we will find ourselves in a situation where we are nearly out of money again, without additional reserves, and still not be making a profit at the shop.
We have decided to invest some additional money, but not sell the rental house, and keep going. There is no way to predict what has happened with gas prices, and the resulting increases in raw product costs, not to mention tighter budgets of our regular customers. Some say oil could hit $200 a barrel, which would be devastating to our entire economy and to every individual. Nemo’s would not be the only casualty of such an event. Things could also stabilize after the elections in November and everything could go back to normal (as normal as things get, anyway) for another four years. I have always been interested in politics and how they affect world events. As a business owner, I am much more tuned into what is going on and what impacts things can have. As a result, I am very concerned about the upcoming elections. I am a conservative Republican, and McCain is not my first choice for a presidential candidate by any means. However, all the Democrats have to offer this year are borderline Socialists in Obama and H Clinton. They have stated they intend to provide national health care, to increase government spending through various programs, and both will result in a major increase in taxes. They also oppose any oil exploration or drilling, which will prevent America from becoming energy independent, which is important for both our economy and our national security. When you look at the increased consumption by China and India, and the way that Russia has reinvented itself to be the OPEC of the next century, we could be in real trouble. Does any of this concern our politicians? A few I suppose, but the Speaker of the House is off on a book signing tour while her approval rating with the American people hovers at about 9%. Unbelievable… I’m not a political activist by any means, but these issues play a part into whether or not our business survives. If you are concerned about gas prices, I would suggest calling your elected officials (Senators and Congress members) and tell them you are concerned. Better yet, state your opinion with your vote in November. If you want your tax dollars to pay for medical coverage for millions of welfare recipients and illegal immigrants, then vote for Obama. If you want gas prices to continue to increase, then vote for Obama. If you want the existing tax breaks (put in place by G Bush) to expire, vote for Obama. If you want our country to ignore rising threats in Russia, China, Iran, North Korea, Venezuela, and elsewhere, then vote for Obama. An out-pouring of concern by the People is the only thing that will get our politicians to address our problems with real and effective solutions, instead of working for self preservation and self-wealth… If you want for Nemo’s Coffee to survive, then vote for McCain and call your elected officials and tell them you want lower gas prices.
If you are a conservative by nature, then I’m sure this post makes sense to you. If you are an Obama supporter and this post has offended you, then I suggest you research the issues I’ve mentioned above. Do some honest research into where Obama stands on these very important topics, how they will affect your taxes and your lives, and then decide who to vote for.
Regardless of the economy, world events, presidential elections, and the cost of oil tracy and I need to increase our sales just a little to allow us to operate above the break even point. Once the kids start school next week, Tracy and her mom are going to distribute fliers to surrounding medical complexes, office buildings, the Olympic Training Center, Memorial Hospital, and other high density areas close by. We have been waiting for the building remodel work to be completed prior to doing so, and we expect to get a boost in sales from this effort. We had 5000 fliers professionally printed, and they are ready to go! We considered hiring someone to distribute them, but we would have no way of knowing if they really did it, or just put them in a dumpster and went to the movies instead. Tracy wants to be the one to interact with office staff personnel, especially at all of the medical complexes close to us.
We are basically at the breaking point. If our efforts work and we invest a little more cash, we will make it through this tough time. If our efforts have no impact and the economy continues to decline, we will not make it. Small deficits will eventually bleed us dry. Any prayers you have to offer would be greatly appreciated!
Gotta run,
JD
