Sales Decrease For San Francisco Small Businesses

Small businesses in a working-class neighborhood of San Francisco are feeling the pinch of the economic slowdown. Sales are down dramatically in many retail stores as consumers hold back on both big and small purchases.

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California Governor Arnold Schwarzenegger told the U.S. Treasury secretary on Friday that his state may need $7 billion in short-term financing to make its payroll. It's the same story for many large and small businesses across the country. Sales are down and business owners are having a hard time getting loans to help them keep their companies afloat. Reporter Nancy Mullane visited one commercial block in San Francisco to see how businesses there are faring.

NANCY MULLANE: Geary Street isn't a place you go for a shopping experience. The busy six-lane commercial street is a place you go to get things done, buy a bed, carpet, and some tires. Chuck Broderick has owned the Big O Tire Store on the corner for 31 years. He says times are tough.

Mr. CHUCK BRODERICK (Proprietor, Big O Tire Store): We used to do about 70 cars a day. Now we do about 40.

MULLANE: In 2005, he says his tire business brought him more than $4 million in sales. This year he says he'll be lucky to see three million, and he's not alone.

Mr. BRODERICK: I did a survey today, and I went by about five shops that didn't have any cars in them.

MULLANE: Broderick says his tire business is so bad, he's had to leverage his homes and max out on his credit cards. Then just a few weeks ago, he tried to get a loan from his bank down the street to cover operating costs and payroll. But for the first time, the bank's loan officer turned him down flat.

Mr. BRODERICK: He just said, I'm sorry, at this time the funds are not available for you.

MULLANE: Now he says he's not sure how long he can hold on.

Mr. BRODERICK: We're just near the brink. I don't cry myself to sleep or anything yet, but I think that's coming.

MULLANE: A couple of doors away, Carpeteria has a big sign out front advertising area rugs, hardwood floors, and ceramic tile. But inside the cavernous store, there's no one even looking at the displays.

Mr. LEO LUSTERIO(ph) (Salesman, Carpeteria): This last two months is worse, yeah, really worse. Very slow, Ma'am. Very, very slow.

MULLANE: Leo Lusterio(ph) is the only salesman in the store. Standing by the front door, he points to awards on the wall. He was one of the top sales persons in 2006 and 2007.

Mr. LUSTERIO: Normally, we have a range of very good sale every day. But now, sometimes it's straight 10 days, nothing. It's zero.

MULLANE: Lusterio says he works on commission, and without sales he doesn't make any money.

Mr. LUSTERIO: If I don't have a good commission, how can I pay my rent? How can I pay my bills? And I don't want to be homeless. Those people who they say they are not worry, I don't think so. Everybody is worried these days.

Mr. TONG LIM(ph) (Manager, Pet Source): It's not very good. It's not very bad. It's enough for us to survive.

MULLANE: That's Tong Lim. He's managed Pet Source for six years. Next door to Carpeteria, it sells everything from dog collars to pet beds and toys. But Lim says these days they're only selling the basics.

Mr. LIM: Right now, people have been buying food more than buying toy or those kind of thing. They don't have extra money to spend, but animals still need to eat.

(Soundbite of grinding keys)

MULLANE: But not all is doom and gloom. Crossing Geary Street is Lock World. Inside the front door, there's lots of activity. Keys are being grinded and salesman Ben Lance says business is up 50 percent on heavy-duty residential safes.

Mr. BEN LANCE (Salesman, Lock World): Like this has become - this is probably our most popular one.

MULLANE: It's a short, squat, heavy-duty safe with maximum fire protection. It turns out people aren't so concerned about burglars these days. They're more interested in safes that will protect paper documents like money from fire. For NPR News, I'm Nancy Mullane in San Francisco.

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