New York Now: Small Businesses Show Resourcefulness -- But 13,000 Still in Lurch

A group of seasoned company owners are showing resourcefulness in difficult times. Here's how they've been able to survive the economic downturn and the devastating terrorist attacks of September 11, 2001.

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Reprinted courtesy of EntreWorld.org

Conducting business in New York City these days might appear daunting for some entrepreneurs. However, a group of seasoned company owners are showing resourcefulness in difficult times. Those who acted early and adjusted their business models have been able to survive the economic downturn and the embarrassment of Corporate America in the wake of the Enron scandal, to say nothing of the devastating terrorist attacks of a year ago, on September 11, 2001.

As technology went into a tailspin in 2001, for example, Connie Connors, founder of a New York advertising agency that serves high-growth companies, acted quickly and decisively. Early that year, she slashed her operating budget by reducing staff and selling off two West Coast offices. She positioned her agency, Connors Communications, as a boutique and held her pricing. Today, the company is operating with a comfortable profit margin and is positioned well for an economic rebound, Connors says.

Another New York company, iVillage, a popular Web site for women, survived the change from dot-com to dot-bomb and is close to operational profitability, again by adjusting its business model. Even prior to September 11, 2001, the company was slashing staff, redirecting sales efforts and creating a second source of revenue - a variety of paid services - to supplement advertising, according to CEO Doug McCormick, who took over from founder Candace Carpenter. Post 9/11, the company has streamlined further and is now sitting on enough cash to see its way into the black, he says.

Tough Times, Unexpected

Resourcefulness aside, not all entrepreneurs were fortunate enough to anticipate tough times. Understandably, few could have foretold 9/11. In just a single day, more than 600 small businesses located in the World Trade Center were wiped out, offices and storefronts destroyed, inventories and records lost. Many owners made the ultimate sacrifice, paying with their lives.

In the wake of the most devastating tragedy our nation has ever faced, the small business people who survived have had to fight back with all the ingenuity they could muster. Fortunately, some relief has been granted, and more is on the way. A group set up by New York State, the World Trade Center Business Recovery Program, for example, has written more than 7,200 checks totaling $200 million to companies that were directly affected by the attacks. Another $500 million is earmarked for distribution.

Another $291 million is coming from a federal fund entitled Small Firm Attraction and Retention Grants. Earmarked for companies with 10 to 200 employees, it requires that the firms' leases that were to expire from the date of the attacks to the end of 2004 be renewed for at least five years. The fund has benefited owners such as Karie Durgin, whose company, Fine Composition, received a $77,000 grant.

Some advocacy groups, however, point out that the restrictions on these grants need to be eased. While 12,800 small businesses are located south of Canal Street, the area most affected by the disaster, a number do not qualify for the funding. The 10-employee minimum has meant that Bob Van Dyke, who owns a recording studio on Stone Street, has been shut out. He has only one employee. For Rosiland Resnick of Access Business Center, the issue was the five-year minimum lease renewal requirement. She was able to secure only three years at her 85 Broad Street location.

All Around the Town

Elsewhere in New York, entrepreneurial businesses in some neighborhoods are faring better than those located downtown. Uptown in Harlem, the redevelopment effort underway prior to 9/11 pushes forward. The Apollo Theatre, once the center of the neighborhood's social and cultural life, is rebounding with great fanfare. A newly renovated theatre comprises the core of an entertainment complex that will debut a new musical, entitled "Harlem Song" and directed by George Wolfe, who presides over the Public Theatre in lower Manhattan. New office complexes, a huge shopping mall, and restored brownstones are bringing life back to upper Manhattan.

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