Small businesses find silver linings in downturn

NEW YORK - An economic downturn, while fraught with pain and problems for so many small businesses, can also have some upsides for companies. Some are to be expected — a tough economy motivates businesses to find new ways to work more efficiently — while others are serendipitous, coming in the form of opportunities for expansion.

Starting out in a tough environment

The retail industry’s struggles have helped boost business for Inwindow Outdoor, a New York-based company that installs advertising displays in vacant retail locations.

Over the past few months, the number of stores that have closed and created advertising space has increased, particularly in New York and California.

“We’ve sort of been bracing for a downturn in our business, but we’ve been surprisingly very busy,” said CEO Steve Birnhak. “The past month has been our best month ever.”

Birnhak said the company has had no shortage of advertisers, and while some landlords initially might be resistant to the idea of turning their vacant storefronts into advertising space, they come to appreciate the chance to keep their revenue stream intact.

David Wexler, owner of The Little Guys, a suburban Chicago custom electronics retailer, said many of his rivals are closing down, and that’s given his company about a 10 percent increase in business over the past three to six months.

“The last month and a half has been pretty crazy,” he said.

As rivals falter, some of their employees are calling The Little Guys, looking for work. Wexler said his company has hired some — but like so many other owners, he’s also been restructuring his business, which means he has let some workers go.

“I think it’s truly a matter of looking inward, fixing the process,” he said. The result is one of the upsides of the bad economy — a more productive company.

Many businesses find growth opportunities because their products or services are in demand when the economy weakens.

At Infusionsoft, a Gilbert-based maker of software aimed at small businesses, orders are increasing from companies that have been laying off employees and that have to find a way to get work done with fewer bodies.

“They have to pick up the hours of the people they just had to cut,” Lee said.

Infusionsoft is finding another benefit from the weak economy — vendors hungry for business are willing to offer lower prices. Sometimes, dramatically lower prices.

Infusionsoft has been approached several times by sellers of Internet advertising space who had lost a sale and wanted to replace it. Infusionsoft was offered prices that were down 50 percent from the original quote.