For 3 Business Owners, Challenges Are Worth It – businessjournaldaily.com

Business Journal Daily | The Youngstown Publishing Company
YOUNGSTOWN, Ohio – Tom Metts has owned a small business for nearly 58 years.  Now age 86, with no succession plan in place, it appears he’s either going to soon close or put up for sale the Boardman hobby store he’s operated for much of his life.
“It’s going to happen,” says Metts, the owner of Boardman Hobby Center at 6820 Market St.
Whether there is demand among buyers to purchase a locally owned hobby store remains to be seen.  “I’m about to find out,” he says with a chuckle.
Metts says he isn’t sure when he’ll make the move but the long days and effort it takes to run a small business is finally catching up with him. “The 10-hour days, the 12-hour days – whatever it took,” he reflects. “It’s just not that simple.”
Moreover, the nature of the hobby business has changed dramatically and demand for items such as plastic models kits or model train sets is not as robust as it was 20 years ago – at least not among young people. Instead, his standard customers are usually adult males 50 years old and upward, he says.
Most young people are not interested in building, say, a replica of a World War II era P-51 Mustang aircraft, he says. A great deal of their attention today is driven by video games or other digital pastimes. “We used to have a lot of young kids doing this. Thirty years ago, there would be bikes parked out front here,” he says. “We have none now.  It’s all old adults, 50 and over.”
Still, Metts says he does maintain a solid business in model cars – whether they’re Nascar kits or muscle cars from the 1960s. Sales of paints and other products remain fairly strong, he adds.
“This business started in 1953 and it was 14 years old when I bought it,” he says. Then, Boardman Hobby was located further south on Market Street, a site that today fronts the western entrance to the Southern Park Mall.  Metts moved to this location 51 years ago – he built the small plaza where the store sits and sold it several years ago. It is among the few independently owned hobby stores left in the region.
Market pressures from larger chain stores combine with stiff competition from the internet, Metts says. Should he be forced to close his store, he believes another business would quickly fill the space.
“It’s worked out pretty good. But it’s time to go,” he says.
ECONOMIC ENGINES
Mett’s hobby store is among the estimated 33.2 million small businesses across the United States. These businesses – generally identified as those that employ 500 or fewer – comprise 99.9% of the country’s companies, making them a vital component of the U.S. economy. Between 1995 and 2021, for example, small businesses created a net total of 17.3 million jobs compared to a net creation of 10.3 million by large businesses during the period, statistics show.  Today, small businesses employ approximately 61.7 million Americans.
Support for these small companies is integral to the local and national economy. But many small-business owners find themselves challenged by inflation, higher interest rates on business loans, a tight labor market, rising insurance costs and other headwinds affecting their ability to grow.
“Last year was a record-breaking year for us,” says Teresa Miller, executive director of Valley Economic Development Partners, a not-for-profit that administers loan and grant programs to small businesses across the region.
In 2023, the organization recorded $17.3 million in loans or grants to small businesses. Through the first quarter of 2024, Valley Partners has processed 37 loans or grants totaling $4.8 million, which is on pace to exceed 2023’s numbers.
“Industrywise, there’s nothing concentrated,” Miller says. Restaurants, manufacturers, retail, hotels, hair salons – all have applied for some type of financial backing through Valley Partners.
The organization has made efforts to devote capital to underserved populations across the Valley through its Community Development Financial Institution, or CDFI, fund. This program – funded by the federal government – allows Valley Partners to lend money to qualified small businesses within distressed communities at lower interest rates, between 3% and 4%, Miller says.
As the money is repaid, it’s returned to the revolving fund to finance other projects. The organization has filed an application to recapitalize the fund this year, she says.
Lending rates hover at 7% through Valley Partners’ traditional revolving loan fund and other programs, Miller says. “These are used specifically to fill a gap where a project that’s undercapitalized, where the bank doesn’t want to do the entire portion, but rather 40% or 30%,” she says.
Over the last several years, Miller says, more clients have approached Valley Partners before dealing with their banks. “We’ve been working more this year to include our banks,” she says, taking to them a project that could be partially financed by several of the organization’s partners.
LENDING ENVIRONMENT
The last year has been tough,” says Ken Greco Jr., owner of Southside Recycling on Florida Avenue in Youngstown.  “It’s a tough lending environment and money is expensive to borrow.”
Recently, Greco requested an equipment loan for a forklift through a bank with which he had a strong relationship, he says.
“They wanted 9.5%,” he says, plus a burdensome and unusual amount of paperwork. In the end, he found an option through another lender that reduced that rate by 4.5% and he was able to secure his forklift.
“If you’re a new business, how do you do it?” he asks, adding he’s unsure about the direction of the economy, especially in an election year. “I’m starting to hoard cash.”
Southside Recycling, in business for 10 years, purchases scrap metal and other materials from residential and industrial customers and resells the material at a profit. While residential business continues to be solid, he’s noticed a fall off with industrial customers.
Shipping the material has become more costly. “I’m paying 20% to 30% more because of fuel prices,” Greco says. “Utility costs have increased – insurance went up more than 20%.”
Greco’s company employs three and he might have to add another this year. “It’s hard to find people to show up for work,” he says.
Still, he says business remains “OK,” based on the generous flow of residential customers. Scrap steel prices are lower while copper prices have soared.  “My overall attitude is that I live with it. When it gets tough, I work hard.  I know how lucky I am to own this business.”
Small-business owners in the home remodeling sector have noticed some slowdown compared to last year. But certain aspects of their business are keeping crews busy.
“Our overall store traffic has slowed up a little bit,” says Jessie Popovich, who along with her husband, Jim, own Biviano’s Carpet One Floor & Home in Girard.  “What surprisingly is growing is our kitchen and bath, which is a new department for us. We’re seeing steady, consistent interest and growth with cabinetry and bathroom renovations.”
Given the lending environment, she says, it’s likely that more people are renovating existing spaces in their homes than buying – or building – a new home. However, she does get the feeling that customers are more hesitant to spend money at the moment, even during tax-return season.
“I’d say we’ve been doing pretty well,” Popovich says. “We have 10 employees and great customers.”
Biviano’s was established 77 years ago and still operates its original showroom at 1828 N. State St. It has earned long-standing recognition in the industry. “Most of our customers are repeat business,” Popovich says.
Pictured at top: Tom Metts, owner of Boardman Hobby, says it’s time to close or sell his store.
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