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During the recession, downtown Santa Rosa jeweler Doug Van Dyke watched his cash flow decline, prompting him to add less costly merchandise to his jewelry cases.

"We were clearly able to see we had to adjust our price point," said Van Dyke, who owns E.R. Sawyer Jeweler on Fourth Street with his wife, Ame. To be successful, the couple said, the change required that a customer who previously had spent $2,500 on a purchase would still feel comfortable and satisfied buying a gift for $1,000.

Such efforts helped the net revenues at the 135-year-old business grow by double digits each year since 2009, said Van Dyke, the fourth generation of his family to own the store.

Experts say the Van Dykes' financial watchfulness and their ability to adapt are two key traits of successful small business owners.

Today's owners also need to develop a deep knowledge of their market, including their products, customers and competition. And they must be able to devise business plans that can properly guide their efforts.

Monday kicks off National Small Business Week, a recognition that half of America's workforce either owns or works for a small business. Two of every three new jobs are created by such companies, which for many companies can employ up to 500 workers, according to the U.S. Small Business Administration.

What sets small business owners apart is their willingness to work long hours in exchange for the chance to direct their own labors and to reap the rewards of any success.

"They have a passion around what it is they want to do," said Sherrill Stockton, a senior vice president and SBA program manager at Santa Rosa's Exchange Bank.

But some needed skills don't come naturally, experts said. For many owners, the biggest challenge involves learning to use key financial measurements to manage their businesses.

"People get into business because they're good at something. Most often, it's not finance," said Michael Downey, senior vice president of business services at Redwood Credit Union in Santa Rosa. The credit union's business members include the Van Dykes.

A study released last month found that many small business owners experience cash flow problems and often have little in reserve to help their companies weather downturns.

The "microbusiness" study by the nonprofit Corporation for Enterprise Development in Washington conducted 716 online surveys and 216 phone surveys with owners whose companies had 10 or fewer employees and less than $2 million in annual revenues.

Fifty-five percent of the online respondents said they could cover their business expenses for only one month or less. Of those, three in 10 said they had no business savings at all. Even among respondents to the phone survey, which involved more established businesses, nearly half of the owners had business savings accounts that could cover just two months or less worth of expenses.

For all the surveyed owners, roughly four in 10 said they don't have enough cash on hand at times to meet their business expenses.

Small business owners could benefit from affordable credit to help them make it through the down cycles, but they also need to do a better job of saving, said Manny Hidalgo, the nonprofit's director of entrepreneurship.

"You've got to be ready for that rainy day with your own resources," he said. Otherwise, business people can end up dipping into personal savings or even into retirement funds, "which is disastrous."

The study also suggested that owners who did more to track their financial data were less likely to have cash flow problems. The owners who used an Excel spreadsheet typically avoided cash flow problems better than those who either used a software program or paid an employee or consultant to manage the books.

"They have to develop an intimate understanding of the finances and not hand it over to anyone," Hidalgo said.

What gets most owners into business is an idea for a superior product or service. But success requires figuring out how to exploit that advantage.

"Businesses are in business to solve problems," said Armand Gilinsky, a business professor at Sonoma State University. Successful owners can answer the question: "What can you do better or what can you do that others cannot?"

But they also need a plan.

"Having a good business plan is critical," said Larry Arnoff, a counselor with North Coast SCORE, a nonprofit that provides guidance to small business owners. "You really need to know where you're going and how you're going to get there."

Many businesses get started without such plans. But both lenders and consultants said they need to look at the plans, in part to see how well the owners have thought things through.

A business plan allows an owner to demonstrate another valuable trait, namely the knowledge of his or her market.

That includes knowing key details about customers and their wants. It means understanding the competition and their products or services, including costs. And it requires understanding their business products, costs, distribution and marketing efforts.

Local small business owners agreed that they pay close attention to their customers and their expectations. That includes the values they place on a quality product, a company's community involvement or a business's ability to give expert guidance.

Patricia Benfer, who with Cheryl Ytreeide owns Savory Spice Shop in downtown Santa Rosa, said she has learned "to be willing to go to any lengths to answer a customer's questions."

"They expect their meals to come out better because they buy their spices here," Benfer said.

Gaining knowledge of today's market isn't enough, the experts said. Owners must keep learning, and they must gather good advisers around them. Both loan officers and business owners recommended the help of both SCORE and the Sonoma Small Business Development Centers, both of which receive assistance from the Small Business Administration.

"If you struggle with this stuff, find a trusted source and get help," said Redwood Credit's Downey, who owned a commercial tire business before going into banking.

Part of learning means constantly looking for new products or services.

When consumers enter a store, "you want to see new items," said Herb Liberman, an advisor with the small business development centers. Even a technology giant like Apple always gets "a new pop" when it unveils another product.

Another small business center advisor, Robert Toering, said a key trait of successful owners is adaptability.

"No matter what activity they're involved in," he said, "the world is constantly changing."

Local companies gave plenty of examples of adapting.

At Sawyer Jewelers, which is known for having its own staff of goldsmiths, the Van Dykes chose to expand into new jewelry lines during the recession when manufacturers offered more appealing terms.

"It was an opportunity for us to grow," said Ame Van Dyke. The company's popular lines today include Hearts on Fire, Marco Bicego and Heather Moore.

The couple, who work with nine employees and an intern, said owners need to resist the temptation to keep doing things the same way.

"So many people get stuck, especially in generational businesses," said Doug Van Dyke.

At Savory Spice, which opened in 2010, adaptation meant temporarily setting aside profits in order to save up to open a second store.

Prior to starting a second location in Sonoma, "we ended up not paying ourselves," said co-owner Cheryl Ytreeide.

Ytreeide and Benfer were able to get a second SBA loan from Exchange Bank, and they opened their Sonoma outlet in November. The owners now work with seven part-time employees at their two shops.

At Frozen Art in Santa Rosa, owner Jorge Alcazar had to adapt when his Sebastopol Road shop didn't attract the expected foot traffic after its opening three years ago. He began supplementing his frozen fruit bars by making "crazy" gourmet ice cream flavors, including maple bacon, passion fruit, lavender honey and avocado.

The switch didn't come without raising eyebrows. When a local chef asked Alcazar to make hay-flavored ice cream, his father responded by asking the son, "Esta loco?" or "Are you crazy?"

But Alcazar, who relies on his family to help operate the business, noted the pleasant surprise of customers at his ability to capture the actual flavors listed on his ice creams labels. And he found he could regularly sell more than 30 gallons a night last summer to customers at Cloverdale's Friday Night Live street fair.

"They just kept lining up and lining up," he said.

The recession forced adaptation at Healdsburg's Surface Art Countertops, both when work slowed dramatically and when it picked up again.

For owners Marc and Stephanie Rumpler, a downturn in late 2008 meant seeking more jobs with smaller profits in order to keep their crews working. With the help of Toering, the small business advisor, they began offering customers sinks and faucets and accompanying them to yards to select and acquire granite and marble countertops. They also expanded into Marin County by collaborating with San Rafael-based Hudson Street Design of Marin.

When work picked up markedly last year, the couple faced the new challenge of needing more cash on hand to pay their 10 employees and vendors while waiting to get paid by new customers. To help, they switched to Summit State Bank, which consolidated their debts and provided a line of credit that allowed them to undertake larger jobs.

Marc Rumpler considered Toering's help invaluable. "Sometimes you're in the thick of the battle and it's hard to see the long term," he said. At times, it was good to just hear from an expert that his challenges were "no different than anybody else."

The upheaval of the last six years was by no means easy, Marc Rumpler said, "but it made us a better company. We have learned to do a lot more with a lot less."

(You can reach Staff Writer Robert Digitale at 521-5285 or robert.digitale@pressdemocrat.com.)