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Step Inside

Jade Jump and Nate Clifford

Jade Jump and Nate Clifford, owners of Cornucopia in Northampton.

For Dave DiRico, the forced shutdown of retail outlets across the Commonwealth in March could not have been more ill-timed.

After all, late March is when many golfers, a good number of them armed with gift certificates from the holidays, start filing into his store in West Springfield, DiRico’s Golf & Racquet, and reload for the coming season. They come in looking for new clubs, balls, bags, shoes, and other accessories.

And they keep coming in through the spring, said DiRico, noting that, aside from the holidays, March, April, and May are by far his busiest months.

But not this year, obviously, as he was closed completely until early May and then open for curbside sales only — something this business isn’t really suited for — for several weeks.

But when he did reopen … well, the surge in business might not make up for everything that was lost during the shutdown, but it has been significant and in many ways surprising. Indeed, in addition to what could be called pent-up demand — people who needed to reload and had to wait until he was open to do so — the pandemic has actually created a mini-explosion of interest in golf, because it’s one of the few sports that can still be played under the current restrictions and advisories on social distancing.

“Things took off … it’s been crazy,” DiRico told BusinessWest. “One of the few outdoor activities you can have right now is golf; we have kids who were supposed to do internships and can’t, and they’ve taken up golf. We have kids who played baseball and summer sports and couldn’t play those, so they’ve taken up golf. We have spouses who’ve never played the game who have taken up golf.

“Couple that with our regular business,” he went on, “and June and July have taken off like a rocket ship.”

Nate Clifford has also navigated the ups and downs of shutting down and reopening at Cornucopia, the natural-foods store he and his wife, Jade Jump, own at Thornes Marketplace in downtown Northampton. They were among many shop owners who had to shift their business model on the fly to survive the past few difficult months.

“Shoppers are saying, ‘I just wanted to shop with somebody locally.’ We’re hearing a lot of that. I think that’s awesome.”

In fact, March 15, the day they and all the other Thornes stores shut down, was the couple’s one-year anniversary of buying the 40-year-old establishment. Though sales of food and wellness products may have made Cornucopia an essential business in the state’s eyes, Thornes made a decision to shutter the whole complex, and that meant Cornucopia, too.

“We understood, but we made an impassioned plea to the landlord to give us some access for pickup and delivery, with the goal of helping people, especially the older population around here who need us,” Clifford said. One day later, on March 16, they were back in business with that new model.

“We put a simple order form up on the website and told people, ‘you shop here; you know what’s here — what’s your wish list, and we’ll get the best possible order for you.’ We delivered, or you could pick it up and we’d run it out to you, put it in your trunk or in the passenger window, whatever you were comfortable with. We did that for three months, and we were overwhelmed with the support we got.”

That support was certainly reflected on June 15, the first day shoppers were allowed back in the store itself. “We had such a rush of people, I had to step into the back room to shed a few tears,” Clifford said. “I thought, ‘we’re going to be OK.’”

Unfortunately, not all retailers can say the same thing. They’ve seen some pent-up demand, to be sure, but 2020 is turning into a very challenging year as many shoppers are staying home, cutting back on their spending (or both), and doing most of their buying online.

Still, retailers are happy to be open again, even if the long-term outlook is mixed, and consumer confidence remains uncertain.

One Step at a Time

Sharon Cohen, who has owned Footbeats for Women at Thornes for the past four years, noted that, without college students and tourists from out of town, business is slower than is typical for this time of year, but customers are returning steadily. She’s happy to see them, especially after instituting the safety measures mandated by the state — and by common sense.

“We’ve revamped the way the store is laid out to promote social distancing,” Cohen said. “Shoppers are saying, ‘I just wanted to shop with somebody locally.’ We’re hearing a lot of that. I think that’s awesome.”

After Thornes was shut down in mid-March, Cohen launched a website so customers could still purchase her shoes, and, like Clifford, she delivered to peoples’ homes. Every Friday afternoon, she used Facebook Live to talk about shoes in stock and offer commentary on trends and new styles.

“I’d pick them off the displays on the wall and talk about them. Customers would text and ask questions about cost or size,” she said, noting that she will likely continue that practice. “We tried new, inventive ways to meet the customers.”

In the store, she tries to strike a balance between customer needs and safety; for example, when customers try on a pair of shoes, if they are leather and cannot be sanitized, the shoes are put in quarantine for 24 hours, as per Centers for Disease Control and Prevention (CDC) guidelines.

Dave DiRico

Dave DiRico says a mini-explosion in the popularity of golf has helped offset some of the huge losses incurred when his shop was shut down by the pandemic during the spring.

Thornes management has instituted many new protocols and equipment, including iWave ionizing air filters that heighten air quality, foggers that sanitize the building nightly, and door monitors at each of the two open entrances to ensure that people entering wear masks and sanitize their hands. The complex also installed hands-free door openers on bathroom doors.

“Thornes has done a lot to prepare for our opening, and we continue to stay educated and follow safety protocols,” said Richard Madowitz, the marketplace’s co-president. “We are receiving consistent positive feedback from shoppers on the cleanliness of the building and their comfort. We are providing a safe environment.”

All shared tables and chairs on the building’s second and third floors have been removed, and directional arrows on the floors separate traffic and promote social distancing.

“Signage is everywhere,” Madowitz stressed. “Each store is managing its state-mandated capacity count, and Thornes itself is managing the state-mandated capacity counts for its common spaces without shops.”

“I make sure people who come into the store feel safe. I’m doing what I feel is right by my customers and staff. That’s my focus.”

Mask compliance is high, at 99%, he noted, adding that “masks are not required for those with medical conditions that prevent them from wearing one.”

Despite what he calls a “vocal minority” making waves nationally about mask wearing, Clifford said his customers have been respectful of the mandate.

“We’re dealing with people who have health issues, and I’d say the average customer spending big amounts is over 50, getting supplements, taking to our expert staff. We want them to feel safe,” he told BusinessWest. “For those folks who don’t want to wear masks, even for legitimate reasons, we still have pickup and curbside. But I make sure people who come into the store feel safe. I’m doing what I feel is right by my customers and staff. That’s my focus.”

Visitors to Holyoke Mall are greeted with a similarly wide range of mandates, from face coverings and six-foot distancing to directional arrows and guidance to wash hands, use sanitizer, and avoid touching products unless purchasing them, said Lisa Wray, the mall’s director of Marketing.

In return, the mall has enhanced its cleaning and sanitizing of the common areas and numerous touch points, restrooms, seating areas, and food court, and the cleaning team is utilizing new electrostatic sprayers, leveraging the same technology used to clean hospital rooms, using an approved disinfectant recommended by the CDC. In addition, Holyoke Mall employees, security, housekeeping staff, and contractors undergo daily health screenings.

Sharon Cohen

Sharon Cohen says she used online outreach and a sales website to stay afloat during the shutdown.

All those steps were necessary, Wray said, to not only bring customers back, but make them feel safe upon return.

“Having our tenants close with thousands of employees and their livelihoods impacted is certainly difficult; however, the safety and well-being of our guests, employees, and tenants is of primary importance,” she told BusinessWest.

“We have been seeing guests steadily return to the shopping center, and even with reduced occupancy, tenants have been seeing strong sales,” she added. “With the back-to-school season upon us and the sales-tax holiday weekend at the end of August, we’re hopeful the months ahead will continue to trend positively. We’re cautiously optimistic that the fourth quarter will continue to ramp upward, as guests adapt to this new way to shop.”

Warning Signs

That optimistic view isn’t shared by the entire retail industry. Just last week, two businesses at the Shops at Marketplace in downtown Springfield — Serendipity and Alchemy Nail Bar — announced they were closing, unable to stay afloat after the forced pandemic closure and an inability to procure business aid from either the federal Paycheck Protection Program or the city’s Prime the Pump grants.

Meanwhile, on a national level, Tailored Brands, which owns suit sellers Men’s Wearhouse and Jos. A. Bank, is closing hundreds of stores and drastically reducing its corporate workforce as the pandemic continues to decimate the retail industry.

GlobalData Retail recently noted that year-over-year sales of men’s formal clothing fell by 74% between April and June, and not just because stores were closed. “While this deterioration will ease over time, demand will remain suppressed for the rest of 2020 and well into 2021 as office working, business meetings, and socializing are all reduced.”

Fortunately for DiRico, the pandemic has done the opposite in the golf sector, creating some opportunities in the form of new players who need equipment — with many of them using stimulus checks to buy it. But there are challenges as well, starting with shortages of stock caused by closure of factories and then restrictions on capacity.

“Our biggest problem right now is getting equipment,” he explained. “That’s because most of our manufacturers are based in California, where only 40% of the factory is open, which means they can only produce ‘X’ amount of clubs for the world; it’s slow in getting equipment.”

Other challenges include the many the new rules and protocols regarding social distancing and sanitizing, he went on. Still, for the customer, things are pretty much business as usual, meaning they can still try on shoes or gloves and take a few practice swings with a driver in the simulator.

‘Normal’ is not a word that comes to mind when describing operations or this year in general, but overall, the surge the game has seen will certainly help make 2020 less forgettable, DiRico went on, and it offers considerable hope for the future — if those who have taken up this difficult, expensive, and time-consuming game can find a way to stay with it.

“For the past 15 years or so, golf has been on the decline,” he said, listing cost and time among the big reasons. “Now, some of the pros I’ve talked with say they’re booked solid; they have tee times from 6:30 to 4. And membership at the country clubs is up. If these clubs can retain just 15% of these new golfers, they’ll be in good shape.”

For Cornucopia, the pandemic offered an opportunity to build an online, pickup, and delivery presence it might not have otherwise, Clifford said — one it will continue to maintain, opening up new business avenues.

“We were thrilled to be able to pivot to that quickly. That’s one thing Jade and I do well, being flexible and doing whatever we need to survive. We’re resilient, and now that we have a strong foundation, if we were ever to experience another shutdown, we’ll be able to continue the cash flow.”

These days, sales volume isn’t what it was on reopening day on June 15, and won’t be until colleges are back in session. “That’s when you normally see more foot traffic; July is not a busy retail time,” Clifford noted, adding that a weakened tourism season isn’t helping, as even visitors to the Berkshires often make their way to downtown Northampton for an afternoon. “That’s not happening right now.”

But he’s cheered that all the Thornes businesses are open seven days a week. “That has caused a lot more consistency in the shopping experience, when the stores are open and welcoming people and wanting them to come in and physically shop.”

And hoping that extended shutdown is a thing of the past.

Joseph Bednar can be reached at [email protected]

Cover Story

History indicates a recession, but most just aren’t seeing evidence of one

‘Optimistic skepticism.’ That’s the phrase one area bank president summoned as he talked about the year ahead and, more specifically, talk of a recession. While history — especially as it relates to the inverted yield curve — tells us one is very likely, most all other indicators, from unemployment and inflation rates to the stock market to the steady pipeline of work on the books at area construction-related firms we spoke with, say something else.

It was the Monday before Christmas. John Raymaakers II wasn’t planning on being in that day, but an important bid was due, and he had to wrap up the paperwork.

There were a lot of bids to vie for in 2019, Raymaakers, a principal with Westfield-based general contractor J.L. Raymaakers & Sons Inc., told BusinessWest, noting that the company prevailed in several of these competitions, success that translated into one of the company’s better years recently.

And it’s a trend he expects will continue into 2020.

“We’re still busy at this time of year, and that’s a good thing for us,” he said, noting that the firm specializes in heavy civil construction work such as water, sewer, and drainage systems. “And we’ve got jobs we’re bidding on — one today and another next week. We have a good amount of work in front of us, so we’re feeling pretty good.”

Raymaakers is not alone when it comes to a generally positive outlook for the year ahead. Indeed, BusinessWest talked with several business owners, including many in the construction sector — usually a highly accurate barometer of the overall economy — to get a feel for what might be in store as a new decade dawns.

Slicing through the various comments, it appears there is some uncertainty about the year ahead, which is natural given the considerable talk about a recession, the fact that is a presidential election year, and the ongoing workforce issues facing virtually every sector of the economy.

But there was also something approaching consensus that the generally good times that prevailed in 2019 — and for the past several years, for that matter — will continue in the year ahead.

Tom Senecal, president and CEO of Holyoke-based PeoplesBank, told BusinessWest that, while some indicators may give pause for concern, such as an inverted yield curve (more on that later), most would indicate there is little trouble on the immediate horizon.

“The economy is doing really well,” he said. “We see that in our numbers — from our loan perspective, with delinquency rates … everything is humming along.”

Curtis Edgin, a principal with the Chicopee-based architecture firm Caolo & Bieniek, sounded a similar tone when asked what he’s seeing and hearing.

Tom Senecal says he believes in history and the power of the inverted yield curve to forecast recessions. But his eyes prompt him to be ‘optimistically skeptical’ about a downturn.

“No one’s seen any signs of it letting up,” he said of an expansion that has lasted a full decade now, adding quickly that he’s seen enough economic cycles to know that things can change quickly. He just hasn’t seen any evidence that they will.

Meanwhile, Scott Keiter, a principal with Northampton-based Keiter Builders, said his firm had a record year in 2019. He quickly qualified that by saying the business, only 11 years old, has grown every year since its inception and 2019 was merely the latest in a succession of ‘record years.’

That said, the company, like others we spoke with, has a solid flow of work that will keep it busy well into the new year, with more projects on the horizon.

“Most of our work is institutional and commercial, but we also saw a significant increase in larger residential projects, and I think that’s a good sign — people are willing to invest significant amounts of money in their properties” he said. “And we have a good, secured pipeline for the spring and early summer, and that’s not always the case.”

But, while general optimism prevails, there are challenges facing business owners and managers, especially when it comes to workforce issues, specifically finding and retaining talent.

Indeed, what was once considered a good problem to have — and some still use that phrase because it generally means business is good — is now considered to be just a problem. A nagging problem.

“My membership would say, to a company, that the biggest barrier they have to increased growth is finding more people and finding the right people to expand the workforce and take on additional work that’s out there,” said Rick Sullivan, president of the Economic Development Council (EDC) of Western Mass. “The biggest problem we’re facing is workforce — finding talent, developing talent, and retaining talent — and that’s across all levels, from entry level to middle and upper management.”

For this issue and its focus on the 2020 Economic Outlook, BusinessWest talked with several business and economic-development leaders about what to expect in the year ahead. While no one has a crystal ball, most say their eyes tell them the decade-long expansion could certainly continue into the next decade.

Work in the Pipeline

Senecal told BusinessWest he was giving a speech a few months back, and while talking about the economy in general, he referenced the inverted yield curve and its historical significance.

“Every time a yield curve has gone inverted or flat in the past 50 years, and there have been seven times, in every single case it has indicated a recession, usually about nine months after the yield curve gets inverted,” he said, summarizing his remarks. “Which would indicate a recession around May or June of 2020; that’s what history tells us.

“But when you look at our economic numbers — extremely low unemployment, inflation in check, economic growth being wonderful, the stock market doing wonderful … I’m not a predictor, but indications don’t feel the same as they have over the past 50 years,” he went on. “If you’re a believer in historical data as a predictor of future performance, then the numbers say a recession should come in May or June. But I just don’t see it. I am a believer in history, and I am a believer in data, but let’s just say that I’m optimistically skeptical when it comes to a recession.”

There are a many reasons to be optimistically skeptical when it comes to a recession, especially when talking with those in construction-related businesses, which, as noted, provide an historically accurate barometer of what’s happening with the economy.

That’s especially true of architects, who usually feel the effects of a downturn before almost anyone else. Edgin, who, as noted, has been through a number of ups and downs in the economic cycle in his 35-year career, said he hasn’t seen anything to indicate the economy is slowing to any great degree.

His firm handles both public- and private-sector work, and especially the former. Edgin said this diversity has helped it ride out the slow times. The firm has completed much of its work involving an $85 million elementary-school project in Easthampton and doesn’t have anything approaching that scale in the pipeline. But there is work in the pipeline.

Scott Keiter says his construction business has a solid pipeline of work heading into 2020, a sign of a generally sound economy.

“We’re busy,” said Edgin, using a word that most in the construction field would certainly like to hear him use. “We’re seeing a significant number of studies for projects like senior centers, town halls, libraries, or police stations — people recognize the need; they just need to get their ducks aligned to keep things moving.”

Meanwhile, his firm is handling a handful of smaller projects, including work at the Boys & Girls Club in West Springfield, Westfield State University, and other institutions, as well as some private-sector projects.

Summing things up, he said the company is “catching our breath” after a solid 2019 punctuated by the Easthampton project and waiting for some of those projects in the study phase — and there are quite a few of them — to come to fruition.

“Maybe that’s the adjustment,” he told BusinessWest. “And if that’s all the adjustment we need, I’m happy with that; we were oversubscribed, let me put it that way, in 2018 and 2019.”

This past year was also a busy one for Keiter Builders, which, as noted, had a number of projects on both the residential and commercial sides of the ledger. The latter category included a good deal of work at both Smith College and Amherst College, while the former featured several new homes and a number of large-scale renovation projects.

Summing up what he’s heard from clients in both realms concerning the economy and the year ahead, he said it’s mostly upbeat.

“The people sending the money our way … it’s generally positive,” he noted. “We’re not hearing anything from them that’s concerning — it’s just your normal chatter. People are steaming forward; they’re investing in infrastructure and capital projects. And that’s good news for us.”

Raymaakers concurred. He said 2019 was a busy year — he said it was a ‘9,’ maybe a ‘9½’ on a scale of 1 to 10 — that featured several large-scale projects, including runway-grading work at Barnes Municipal Airport in Westfield and dam repair at Forest Park. Work was so steady, the company added employees, bringing the total to 39.

John Raymaakers, seen here with his wife and business partner, Laurie, says the company is feeling “pretty good” about 2020 and the economy in general.

Looking ahead, he told BusinessWest the firm remains optimistic.

“We’ll see how the election goes, and after that … who knows?” he said. “Right now, we feel pretty good about things.”

Work in Progress

Those comments sum up how most people feel about almost everything except the workforce challenges facing them.

Raymaakers said his company did bring on more people, but finding them wasn’t easy. Keiter said his firm also struggled to find people to handle its growing workload.

And Senecal confirmed that the problem extends to positions at all rungs of the hiring ladder. To put the matter in perspective, he talked about a position the bank has been trying to fill — unsuccessfully — for half a year now.

“We’ve been looking for someone for more than six months in our Accounting department, someone with five to 10 years of experience in the banking industry,” he noted. “And what’s more surprising is that, with all the consolidation going on in this industry, we’re still not able to find someone for that position.

“Overall, it is very difficult to find people right now for many of the jobs where we’re looking for specific skills — it’s virtually impossible in some areas,” he went on. “It’s been such a challenge, and that’s a clear indication of what’s happening in many sectors.”

Indeed, the problem is prevalent in pretty much every sector of the economy, said Sullivan, noting that it is manifesting itself in a number of ways.

One is some upward movement on wages and benefits, which is yet another sign of a healthy economy, he said, adding that, while this isn’t happening across the board, there is movement in many sectors where there is steep competition for talent, especially precision manufacturing and financial services.

“People have choices when it comes to where they can work,” he told BusinessWest. “People are looking around, so in order to keep a workforce, people are having to pay a little more and provide some other benefits or incentives.”

In addition to movement on wages, there is a greater focus on trying to bring more people into the workforce, said Sullivan, noting that, through a grant from the Boston Federal Reserve and the Working Cities Initiative, the region has launched efforts to bring some of those who have been on the outside looking in when it comes to the workforce into the fold.

These endeavors involve mostly entry-level positions, and they’re a relatively new point of emphasis for the EDC, he said, adding that they are generating some results, putting those who have been unemployed or underemployed not just into jobs but onto career paths.

Meanwhile, the EDC is looking at taking steps to bolster the workforce, including what could be called recruiting efforts — steps to market Western Mass. and its many benefits in the hope that some may seek to relocate.

“This might involve some regional advertising initiative — an effort to raise awareness about Western Mass. and how it’s a great place to live, there are opportunities here, the cost of living is lower than many other areas of the state and the country,” he explained. “And while it’s a great place to live, it’s also a great place to work.”

Such efforts would be focused on other areas in the Northeast, especially older manufacturing cities that may not be doing as well as the Greater Springfield area, Sullivan noted, adding that he’s not expecting to lure people from Arizona or Florida.

“Sometimes, it’s a little tough to sell those winter months,” he said with a laugh, adding that the region does have many saleable assets, and its businesses need workers to grow.

Such a campaign would not have a large budget, and it would be waged mostly with social media, he said, adding that there is an opportunity to attract people for certain sectors, especially precision manufacturing.

“It will not a be a large media campaign — you won’t be seeing us on the Patriots game,” he said, adding that targeted messages promoting opportunities in specific sectors may help grow the workforce.

Forward Progress

Traditionally, the phrase one hears when it comes to the economy and the year ahead is ‘cautious optimism.’

There’s some of that this year — quite a bit, in fact. But overall, there’s more of that optimistic skepticism that Senecal spoke of and that others referenced, even if they didn’t use those exact words.

History, and some of the economic indicators, tell us that a downturn is likely, if not imminent.

But most business owners and managers just aren’t seeing it — and that’s certainly a good sign as a new year and a new decade begin.

George O’Brien can be reached at [email protected]