Business executives: Downturn different this time

Jim Saad, left, owner and president of Mover’s Suite Software, and Doug Simons, co-owner and president of Enstrom Candies, discuss their experiences in managing businesses during downturns. The effects of the recession have been different than the oil shale bust of the 1980s, they said. (Business Times photo by Phil Castle)

Jim Saad and Doug Simons have experienced economic downturns before. But the effects of the Great Recession are far different than the oil shale bust of the 1980s, the Grand Junction business executives say.

The latest downturn has been global rather than local and the ramifications more far-reaching. As a result, business owners and managers face difficult decisions as they strive to survive.

Jim Saad, owner and president of Mover’s Suite Software, characterized the latest downturn as “more sustained.”

“And the outlook, in my opinion, is more concerning,” he added.

Simons, co-owner and president of Enstrom Candies, put it this way: “Today, it’s really, well, let’s call it a well-rounded downturn.”

Saad and Simons discussed their experiences as well as offered some advice during a presentation at the Business Incubator Center, the first in a new monthly series dubbed Business Over Breakfast.

The early 1980s actually was a time of rapid growth for the business ventures with which Saad and Simons were involved.

Saad had just started a moving company in Grand Junction when the oil shale boom went bust. “That’s when my business took off.”

Mesa Moving and Storage quickly expanded in the midst of an exodus from the region. Over the course of the next 25 years, the company grew from a small business with three trucks and five employees to a large operation with 250 trucks and 300 employees spread out among a total of four locations in three states.

Saad sold his interest in Mesa Moving to three key employees in 2005 to concentrate on a startup software company. Movers Suite Software since has grown into one of the largest software and consulting firms in the moving industry with 175 software installations across the country. The software integrates move management, accounting, financial services and other aspects of operations.

Simons joined a candy business operated by his wife’s family in 1979 and helped streamline and modernize an operation that within a few years was growing at a clip of more than 20 percent a year. Simons computerized what was largely a mail order operation as well as added additional telephone lines to process phone orders.

While Western Colorado went through a bust, Enstrom Candies increased sales of almond toffee elsewhere. “It was a pretty amazing time for us in the candy business,” Simons said.

Simons and his wife, Jamee, purchased Enstrom Candies in 1993 and have further expanded the operation since then, building a larger manufacturing facility in downtown Grand Junction, opening additional retail outlets and selling almond toffee and other products over the Internet.

A business with gross sales of about $375,000 in 1979 has grown into an operation with annual revenues of about $17 million, Simons said.

The recession that began in December 2007 and in Western Colorado coincided with a downturn in the energy sector, has had different effects, Saad and Simons said.

Simons said his company experienced the first two years of significant sales decreases in its history in 2008 and 2009.

The recession has forced many business owners and managers to make difficult decisions in reducing staff and cutting expenses to survive, Simons said. “You have to have the courage to make very difficult decisions.”

Saad said profitability remains a crucial goal. “The most important thing you can do for a company is to make a profit.”

Maintaining good relationships with bankers to work through financing issues is important as well, Saad and Simons said. But Simons also cautioned against taking on additional debt.

While Saad and Simons said the economy could get worse before it gets better, they also said they believe there are opportunities for businesses that adapt to change.

Saad said he expects growth in the technology sector in particular because technological advances allow businesses to operate more efficiently.

Simons said it’s essential that businesses deliver quality products and services at competitive prices. “I think value is going to be the key.”