Archive for December, 2008
Earlier this year, the Wall Street Journal asked readers to submit their best guess on where the Dow would end the year. At the time, I think the Dow as sitting at about 13,000, and I emailed my answer: 10,500.
Maybe, in times of economic uncertainty, one needs only to
look back in history to come to grips with how innovation inevitably changes
the business landscape.
The fact of the matter is that any business – newspapers
being one in their own headlines recently — unwilling to adopt quickly to
far-reaching technologies such as the Internet simply go out of business.
I thought immediately of the U.S. automakers and their
stubborn reliance on selling gas-guzzling (but previously profitable) trucks
and cars while listening to a recent lecture by Boulder author William L.
Reich, who wrote “Colorado Industries of the Past,” published this year by
Here in Colorado, and in Boulder, Reich looks at some of the
major business empires of their times, some of which today we only see in
boarded up mines or building foundations — “remnants of that bygone era.”
Then, as today, it was all about supply and demand. The
Japanese carmakers figured it out with safe, fuel-efficient cars that didn’t
break down while GM brought us the Hummer.
In the 1800s, as early Colorado pioneers arrived, many
thought they could strike it rich in gold only to discover how impossibly hard
mining was. Businesses making the real money, of course, were those that
figured out what everyone really needed – transportation, food (grains,
vegetables and fruit), beef and other meats, ice to keep everything from
spoiling, and, of course, essentials like beer and cigars.
Other industries took off as the gold rush reality set in,
Reich writes. Brickyards for buildings and homes, millinery shops making hats
and dresses for the women, saddle and spur makers for cowboys and cowgirls, and
a large sugar beet industry. “By the mid-19th century,” Reich
writes, “sugar was no longer considered a luxury item enjoyed only by the
One of the best-known spur and bridle manufacturers,
Crockett Spur and Bit, operated here in Boulder, starting in 1943 when it moved
from Lenexa, Kansas. It employed up to 125 workers at 944 Pearl St. Business
slowly dried up as the passenger car replaced the horse and buggy.
The mining of precious metals, both silver and gold, did
become a major industry for Colorado, and Reich describes how new inventions improved not only
the efficiency of the mines but also the life of the miners.
J. George Leyner, born in Left Hand Canyon west of Boulder,
eventually patented the air and water drill, helping to reduce rock dust in the
air and preventing many miners from a death of silicosis.
The mining industry was especially entrepreneurial, with
hundreds of patents for new pumps, mechanical tables and chemical processes to
extract gold and other metals from the ore piles. Reich weaves in interesting
old photos and illustrations of mills, furnaces and mining techniques in his
book’s chapter on “Mining Precious Metals.”
So what happened to many of the bedrock industries?
Innovation for the most part.
It’s hard for us to consider, as we grab some ice out of our
frig, how everyone depended on the icehouses. Early on, before electricity, ice
was harvested from frozen lakes and stored with sawdust or hay.
Adolph Coors, Reich writes, built his icehouse – 60 by 40
feet and 16 feet high – along with his brewery in Golden.
Boulder had its own beermaker, the Boulder Brewery,
eventually renamed the Crystal Springs Brewery. Now we support our own local
microbreweries such as Boulder Beer, Avery and Mountain Sun.
While lighting up a cigar easily gets you kicked out of a
bar today, almost every Colorado town had its own cigar rollers, who sold their
product through drugstores, billiard parlors and saloons, Reich writes. “An average cigar maker rolled and
turned in about 200 to 250 cigars a day, so he would make between $15 to $20
per week, good wages for the times.” Today, a high-quality cigar might cost you
$10 to $15 just for a smoke.
Those old cigar boxes, now collectibles, indeed were small
works of art, with specialty brands such as the Denver & Rio Grande R.R. Scenic
Line Cigar or Colorado Maid Cigars, using Victorian women as the advertising
“Colorado Industries of the Past” is full of stories of
businesses that helped determine Colorado’s future. Only time will tell if our
governor’s new program to build jobs and companies to renewable and clean
energy will succeed.
What new breakthroughs in solar, for example, could doom the
forecasted landscape of huge wind turbines on the plains?
Boulder celebrates its 150th anniversary in 2009,
a good time to become reacquainted with our colorful history. Booms and busts,
you’ll find, are nothing new. For a new startup or car building legends like
Ford and GM, change is inevitable. It’s a lesson all businesspeople – and their
investors — eventually learn.
Here are 10 reasons someone need to save the Rocky Mountain News.
When more than 100 people line up
in the cold and snow for a $20 gift card to Best Buy, is that a good omen or
bad for the holiday shopping season.
I was there, 10 a.m. on a chilly Friday.
Only the first 50 received the gift card, but everyone got a rousing welcome
from applauding employees, tunes from a brass quintet and … yes, cheerleaders
in white go-go boots and sparkly silver pom-poms.
Welcome to Retailers Desperately
Want You for the Holidays.
Talk about service. Four different
smiling employees asked me if they could help. Opening day, for sure.
I strolled around, checking out the $259.99, 33 disc set of
every Sopranos episode, the Sony Blu-Ray disc player for $299 and – now on my
Christmas list — the digital photo frame that fades from one photo to the
next, on sale for $79.99.
There wasn’t a whisper about Best
Buy’s own forecast, just two days earlier, that changes in consumer’s spending
habits were nothing less than “seismic,” and the company is facing “the most
difficult climate” it’s seen in its 42-year history. Something tells me that
wasn’t in the pep talk for these anxious new employees.
Some employees might be refugees
from the now bankrupt Circuit City, closing hundreds of stores and liquidating
some $350 million of inventory to pay off real estate debt.
The night before I joined guests
for the opening of Ellie’s Eco Homestore, an innovative green products concept
that rightfully chose the eco-friendly Boulder market to test our spending
willpower for natural and organic goods.
The new store, at nearly 10,000
square feet, is a spin-off of the growing green products wholesale business of
Boulder-based Eco-Products, www.ecoproducts.com. Founder Steve Savage is
testing his belief that Ellie’s, named after his daughter, will draw shoppers
to a one-stop center for everything green, from non-toxic paints to organic
cotton apparel from Nau (which closed its own retail store here) to compostable
dinnerware that helped grow Eco-Products.
Savage is aboard a green business
marketplace that is growing in times of other corporate cutbacks. Big corporate
customers like Toyota, eBay and the University of Colorado legitimize his
company’s ambition to become a leading brand of food service products.
In September Eco-Products secured a
$2 million first round of funding from Greenmont Capital Partners, where
Boulder natural food gurus Barney Feinblum and “Hass” Hassan are part of the
management team. That money, Savage said, did not go toward his retail opening.
Locating Ellie’s next to another
Boulder entrepreneur’s baby, Mike Gilliland’s Sunflower Market in the Village
Shopping Center, was intentional, Savage says.
He reads the news, and knows the
economy’s troubles. But “the green products business that we are in is doubling
every year,” Savage says. Competitive prices, employees who know the
eco-product lineup well and local print and online ads keep Savage hopeful.
Now it’s wait and see if shoppers
go green for Christmas.
National mid-priced retailer J.C.
Penney, with third-quarter sales crashing 53 percent amid October’s stock
market debacle, has cut forecasts for the holiday buying season. Same worried
outlook for Kohl’s and Nordstrom.
The headlines have to give pause to
just about any local retailer, although you wouldn’t know it by the smiles and
immediate service you’ll find walking into their stores.
They’re looking for local customers
however they can find them, many even creating their own Facebook profiles and
tossing out a Twitter now and then. My new “friend” Downtown Boulder just sent
me a message: “Shop Local, Give Local, for a prosperous new year!”
For new downtown merchants like
Kevin Natapow, who with his wife Jenny opened Momentum on Pearl Street’s East
End just over a year ago, a little guerrilla marketing can go a long way.
The owners of Momentum, which sells
fair trade and handmade goods from artisans in 55 different countries, have
their fingers crossed.
The couple bought their holiday
inventory last fall, pretty much before the “big collapse,” as Natapow
describes the current economy. They stocked up for what they expected to be a
“normal” year; now they’ve got to wait and see, too.
Unlike the bigger chains, sales so
far seem to be holding up, as the couple’s first year in business have made
them have a little more savvy in a competitive downtown market.
“What we’re hearing,” Natapow said,
“is people are really thinking about what they’re going to buy,” and “buying
local” works in their favor.
Momentum also believes in “cause
marketing,” hosting sales events benefiting local nonprofits. “Come by tomorrow
if you’re hungry,” a clerk told me as she wrapped up a beaded bracelet from
India. On a crucial Saturday afternoon, the store was donating 100 percent of its
profits to the Denver’s Women Bean Project.