(r to l) Michael Ridgeway, Dawn Taylor, Erica Hariman, Nikki Weyandt and Garen Tanner practice a pose in the Flow yoga class at Three Dog Yoga in Santa Rosa on Thursday, May 16, 2013.(John Burgess/The Press Democrat)

Small businesses play big role in Sonoma County

Four fishermen sat around a small table in a corner of Jack Pollard's sporting goods store last week and compared notes on a favorite topic: bass fishing.

"The young kids were pulling out their phones and showing the old timers their pictures," said Pollard, owner of the 8-month-old Pacific Sportsmen shop on Old Redwood Highway north of Santa Rosa.

For Pollard, a retired sheriff's correctional officer, the impromptu exchange showed he can attract hunters and fishermen to a "small mom-and-pop shop where they can go and feel comfortable."

Small businesses like Pacific Sportsmen keep opening their doors in Sonoma County, which is more reliant on small firms than most parts of California.

Seemingly as individual as snowflakes, the small businesses together make a significant contribution to the local economy.

"We really are a county of small businesses, almost micro businesses," said Ben Stone, executive director of the Sonoma County Economic Development Board.

The county's nearly 18,000 businesses are overwhelmingly small in scale. Nine out of 10 companies in Sonoma County employ fewer than 20 workers, according to a 2011 survey by the state Employment Development Department.

Nearly 35 percent of the county's private sector workers are employed at such businesses, compared to just 24 percent statewide.

The county also scores high for the market share of its independently owned stores. Sonoma ranked 14th of 363 U.S. metropolitan areas based on the health of its independent retail sector, according to a 2011 study by the American Booksellers Association.

The study, which measured the market share by community of major retail chains, ranked the county second for independent store activity in California behind San Jose and first among all U.S. metro areas with a population of 250,000 to 500,000.

The high ranking speaks to the character of the county, said Terry Garrett, a spokesman for the GoLocal cooperative, a collection of 300 county businesses and nonprofits that tout the benefits of supporting local businesses.

"It shows a legacy of community support for independent businesses," Garrett said. "And it shows a legacy of entrepreneurism among local business people."

Sonoma State University economics professor Robert Eyler said that entrepreneurial spirit will be key to the future of the county's economy.

"We need to expect in Sonoma County that any growth to come over time is going to be dominated by the growth of small business," Eyler said.

Small business owners today sound a common theme: opportunity. Opening a business gave many a chance to forge a new lifestyle and to make a difference in the lives of their customers.

For them, survival depends on being different from the competition, especially the major chains that can buy goods in high volume. Success requires a savvy understanding not only of how to meet customer needs but also how to build a network that is tied to a town or held together by people with common interests.

"It's not about saving a penny. It's about making sure that a community is healthy," said Octavio Diaz, owner of Agave restaurant and Casa del Mole market in Healdsburg.

Diaz, who opened his restaurant on Vine Street in 2010, gives back by sitting on the board of the town's Chamber of Commerce and the Healdsburg area committee for Community Foundation Sonoma County. He also is a member of the Hispanic Chamber of Commerce.

He said he wanted to open a restaurant to highlight the regional cuisine of his native Oaxaca, including his family's mole negro recipe, and to offer such dishes as mole de Oaxaca and tamales de mole. "There's more than burritos and tacos in Mexico," Diaz said.

The last recession thinned the ranks of county businesses of virtually all sizes. The only segment that increased since 2007 involved those companies with fewer than four employees. However, that growth might have come mostly from the self-employed starting their own business.

"I think those small businesses that were marginal have to a great extent failed prior to now," said Jonathan Coe, president and CEO of the Santa Rosa Chamber of Commerce. Those that survived the downturn likely have the strength for the future, he said.

Even during the recession, new businesses opened, including Three Dog Yoga on Stagecoach Road in Santa Rosa's Fountaingrove neighborhood.

"There's never been a worse time," owner Anna Guhin recalled thinking. "If we can make it now, we can make it anywhere."

The business, which provides yoga classes and now employs a staff of 10, has been profitable every month since opening in late 2009, said Guhin. But in the recession she ran an austere enterprise, which allowed her to offer flexible payment options to customers who had taken paycuts or lost their jobs.

"Now they have jobs and they're coming as monthly members," she said.

In Sonoma, Sheana Davis' Epicurean Connection company has evolved over the past 24 years. Originally a catering business, she went into marketing for specialty food companies in order to have a more flexible schedule as her daughter was growing up.

Today Epicurean Connection employs seven part-time workers at a cheese shop, cafe and beer and wine bar on West Napa Street just off the town plaza.

"The cheese shop is my fantasy," said Davis. "The cafe is my reality. And the beer and wine bar is my profit."

In addition, Davis makes and sells her own fresh soft cheeses and produces the annual Sonoma Valley Cheese Conference.

In downtown Santa Rosa, Greg Darcy moved his 4-year-old Darcy's Fine Jewelers onto Fourth Street last October. His mission, he said, "is not letting my clientele down."

"What business outside of Santa Claus delivers on Christmas Eve?" he asked. The answer is Darcy does, complete with the beard and big red suit.

In Cotati, Dawn and Dennis Russell in 2009 began Treats for Chicken, offering backyard egg farmers an answer to the question, "What else do they eat?" Such products as Chicken Crack, a mix of organic grains and seeds with dried mealworms and river shrimp, is distributed nationally and locally at such stores as Frizelle Enos in Penngrove and Garrett Hardware in Healdsburg.

For the backyard chicken enthusiast, Dawn Russell said, "that old saying, you are what you eat, really applies."

Both Russell and sporting goods shop owner Pollard gave credit for the help they received from the local Small Business Development Center, now overseen by Napa Valley College. The classes and the ongoing input from an advisor have helped them deal with the numerous aspects of running a small business.

"I wear so many hats I feel like I'm a cross dresser," Russell said.

Mary Cervantes, business services coordinator for the federally supported center, said advisors can help owners develop a business plan to identify their target market, know their competition and more accurately price their product.

"It really helps them narrow their focus," she said.

Views are mixed on the current outlook for small business.

The National Federation of Independent Business, whose members strongly opposed the Proposition 30 state tax measure and the federal health care law commonly called Obamacare, said small business owners still face plenty of uncertainty today. Many are concerned with the burdens of taxes and regulation from all levels of government, said John Kabateck, the group's executive director for California.

"They just feel like it's death by 1,000 cuts these days," said Kabateck, who represents 22,000 members in the state.

More optimistic is Mark Quinn, director for the Small Business Administration's Bay Area district, which extends from Santa Cruz to the Oregon border. New loans increased 4 percent in the fiscal year ending Sept. 30 to a record $807 million. The amount had risen 44 percent since 2010.

Quinn acknowledged that SBA lending in the North Bay region of Sonoma, Solano, Napa, Marin, Mendocino and Lake counties has started out at a slower pace than a year ago, but he expects an increase by the end of summer. Eligible businesses include some sizable companies - those with less than $15 million in tangible assets and with less than $5 million in annual profits.

"The North Bay continues to be a strong market for us, and continues to have strong lenders," he said.

Another indicator, the sale of small businesses, has been flat in Sonoma County and the state.

Buyers purchased 258 county businesses last year, the same as in 2009. However, the record value of the stock market and the rebound of the housing market will provide buyers with more equity needed for downpayments, said Peter Siegal, founder and CEO of BizBen.com in Dublin.

"I foresee an increase in small business sales over the next six months," Siegal said.

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