Despite economic slump: Some Butte businesses thrive

In the steady stream of unsettling economic news, the unknown fact is that several businesses in Butte are doing rather well — some have posted steady increases or had some of the best sales in years.

By Leslie McCartney of The Montana Standard

"Our business is really good; we had a record month in March," said Dan Steele of Steele’s Warehouse, which sells furniture, electronics and appliances.

"It’s kinda interesting, you keep hearing that nobody has any money … but we sure don’t see that," added Jake Hart of Hart’s RV, which sells recreation vehicles.

"In April, we’ve had our biggest month in 14 years," added Matt Krsul, owner of Redline Sports, a seller of four-wheelers, motorcycles and snowmobiles.

From housing and cars to clothes bought at Herberger’s, businesses in Butte say that people are continuing to spend and invest in big-ticket items, despite local economic woes.

"Sure, the town obviously has some problems, but we’re not going to fold our tent and leave," Steele said.

And while it may be difficult to grasp the paradox that is the Butte economy, the owners of healthy businesses interviewed by The Standard have several things in common. These include a market net cast much wider than Butte, with customers traveling to their stores; projects located outside of the Butte area; or changes they made to attract customers, such as financing deals.

"If we depended on just Butte, we’d be in trouble," Hart said, saying that his customers come from Bozeman, Helena and Dillon. "With all the gloom and doom in Butte, we just haven’t felt it."

He added that business has also been helped by a national trend with people investing in the recreational vehicle lifestyle, whether they are young marrieds or new retirees.

Krsul’s business has also benefited from customers outside Butte.

"We’ve been reaching toward Bozeman and doing real well reaching into the Madison Valley, Ennis and Dillon," he said, adding that he draws from Helena, Georgetown and Anaconda as well. He has also noticed that more families are purchasing "toys" rather than just men seeking ATVs, motorcycles and snowmobiles.

"It seems that in our industry, if dad buys a motorcycle, he buys a couple more for the wife or kids. We’re seeing a lot more multiple purchases," Krsul said.

Some of that family togetherness is likely prompted by 9/11 with families sticking closer to home rather than spending money on trips to Disneyworld, he added.

Even big purchases have seen gains.

"We’ve had the best year we’ve had in four years," said Bill Markovich of Markovich Construction and Real Estate. Boosted by low interest rates, people who otherwise may not be able to buy their homes are jumping into the market. Even those homeowners refinancing have benefited as the extra savings each month can go toward other purchases — like a new car.

However, he does not suggest that all is rosy in real estate.

Markovich said that home values are off by about 10 percent and that downward pressure can have an unhappy result for those owning homes in Butte for a short time.

"People that bought a home in Butte three years ago are writing a check at closing," he said. However, those who have owned a home for decades are much happier since they make money, although not as much as they could if the home market was not devalued.

And while the turnover rate of homes in Butte is good, it is driven by the wrong kind of generation. That’s because the turnover is not prompted by growth, but rather turmoil with people having to sell homes because of loss of jobs or distress. He also said that home building has slowed as well.

However, other big-ticket sellers like Anaconda car dealer Dee Motors is also seeing great activity — and sales.

"We’ve been very busy. Percentage-wise in 2002 we were up 35 percent over 2001," Bill Dee said. He added that the dealership is seeing more repeat customers and that it has made changes. Interest rates and rebates cannot be underestimated either, as customers reap benefits from those lower costs.

"It’s such a great deal and it’s just not going to get any better," Dee said, and pointed to zero-percent interest deals and rebates. One recent promotion gave the car buyer a $4,500 rebate. In fact, business has been so good that Dee has branched out, establishing a used-car lot on Harrison Avenue in Butte.

In addition to big purchases, those seeking to spend dollars for other items are dropping them in Butte. Herberger’s manager Tom Rolfson is traveling to Milwaukee this week to receive recognition for that store’s No.1 sales performance from more than 40 stores all over the region.

Also, at a recent customer appreciation sale, the Butte store come out as the top performer in the region as well.

"It’s easy to get caught up in the gloom and doom, but we take the attitude that if we have the things our customers want in the area and work closely with the buyers supplying the product and treat customers well, they will come in time and time again," Rolfson said.

With the breakup of Montana Power, Quality Supply’s Ben Vetter was concerned about the Butte economy. However, that has been put to rest.

"We had a great year, and really surprising with all the bad economic things going on I really didn’t expect it, but we ended up 9 percent for the year," he said. "In 2000 and 2001, we had double digit increases."

Quality Supply has many supplies not offered in Butte, such as agricultural products, tack and animal medications.

"Whitehall is a big draw for us," Vetter said. The store is also helped by those needing agricultural supplies from Twin Bridges and other rural towns.

He added that Wal-Mart did Quality Supply a big favor when it expanded its grocery line, making it a destination trip. "We feed on them and vice versa," Vetter said of customers coming to both places.

Lisac’s, with its tire and automotive care services, has also experienced good sales.

"March was a fantastic month — a record-breaking March I think," said Mark Lisac.

However, Lisac’s is seeing more cars for perhaps a little different reason.

"What happens in our business in a poor economy is that people keep their old cars and are fixing up old cars," he said.

A payment plan with no interest for a year has also helped boost businesses as well as diversification with the auto shops offering more services.

Business owners say that in addition to business acumen, a good attitude is important to the bottom line.

"A lot of this stuff, our attitude, is brought on by ourselves with a bad attitude and doom and gloom. If you keep thinking things are terrible, then things are. I try to run my business like everything’s going pretty well," Krsul said.

Reporter Leslie McCartney may be reached via e-mail at [email protected].

http://www.mtstandard.com/articles/2003/05/12/newsbutte_top/hjjgjeihjbhjjc.txt