Struggles Behind Big Money

Photography by Yingzhi Yang

Refueling the car every other day, working seven days a week, shuttling back and forth deep in the concrete jungle, is the kind of life Sergio Sanjurjo gets along with every single day. And he loves every second of it.

Sanjurjo, 25, has been driving for UberX in Los Angeles for five months. Along with doing two other jobs — property manager and marketing promotion— he would be lucky to have five hours to sleep everyday.

“Bills and prices of everything is getting higher, so the only way to get ahead in life is you gotta hustle hustle hustle,” Sanjurjo said, laughing. His main goal is to make enough money within ten years and retire by 35. 

His weekly revenue from driving 30 hours a week is $950. According to Uber’s 80-20 split policy, he gets $760. “Whatever you make, you get 80%,” Sanjurjo said, “so it would be worth driving.” 

Subtracting gas bill $100, car maintenance fee $20, iPhone rental fee $10 (Uber rents an iPhone to each driver to connect them to the APP and block incoming calls) and insurance $30 from $760, he makes a weekly income of about $600. “You can’t complain about that,” He smiled and said, “now your car is working for you instead of you working for a car.” 

Sanjurjo enjoys being an Uber driver most. Not only earning double what he made at a nine-to-five-job, but the sense of making money for himself instead of for somebody else makes him happy. “Different from punching clock everyday, I come and go as I please,” he said.

Being an Uber driver also makes him proud. Some customers come to his car and complain how expensive and smelly the taxies are, how rude the taxi drivers are, and meanwhile express how much they enjoy taking Uber. 

But a recent UberX fares slash by 25% makes Sanjurjo feel the sting. Sanjurio ups his driving time by ten hours per week just to make what he was originally making.

In order to get more rides, he has to keep an eye on the hotspot map showing where all the Uber drivers are, trying to drive further out to avoid a bunch of drivers near him. He also has to stay out longer to pick up people further away where he would not like to be originally.

Especially in traffic, the cost remains the same while the revenue seriously drops. He could be stuck for more than an hour making barely any money. “Driving in traffic is not fun,” Sanjurjo said. 

Sanjurjo always chooses not to drive in traffic. He gets off early, utilizes his day and goes home early before rush hour.

Cutting the price is not the only way Uber leverages supply and demand principles. Actually, Uber is using dynamic pricing — raising prices when the demand is high, cutting prices when the demand is low. As MIT professor Yossi Sheffi puts it, it’s the “science of squeezing every possible dollar from customers.”

During a snowstorm in New York last December, for instance, UberX gouged the price 8.25 times the normal amount. But high risk always comes along with high reward. As James Surowiecki writes in In Praise of Efficient Price Gouging, “the reality is that the times when people most want a ride are also the times when it’s most annoying and, often, most risky to drive.”

For an Uber driver like Sanjurjo in L.A., where snowstorms never happen, surge pricing during times of high demand is the best thing that could happen. “Thanks to the surge pricing strategy,” he said, “it makes me some really good money.” He once made $200 on a normally $40 ride.

The surge pricing is short lived. More often, he deals with annoying cancellations. “It’s irritating when you are on your half way to pick somebody up and they just cancel on you at the last minute,” Sanjurjo said.

Uber’s cancellation policy tries to minimize the hurt by charging a cancellation fee if people cancel rides after five minutes. But any cancellation within the five minutes costs drivers’ money. The unpleasant episode, happening three or four times a day, costs Sanjurjo three or four full gallon of gas.

Sanjurjo’s biggest concern right now is whether decision makers in Sacramento will ban Uber in California. He doesn’t want to lose his favorite job. “I hope they can see that a lot of people make a good living on this and a lot of consumers enjoy it,” he signed.

After topping off his car, Sanjurjo turns on the engine and releases the brake. He and his car blends into the armored concrete and steel.

The Wells Way – Building a Family Construction Company

“We Listen. We Collaborate. We Build.” – These three sentences lay the foundation for Wells Construction, a family originated company since 1989. The business is located in Roseville, California, approximately 25 miles outside of the state’s Capitol. Three generations of Wells family members have received employment from the company, creating a tight bond for the family – and inevitably, bound with its challenges as well.

When the recession hit in 2008, the demand for construction services took a turn for the worse, as the figure below shows. With this knowledge, I anticipated that Wells Construction wrestled to get through the economic downturn. A small, family run construction business does not have the reserve of resources that major construction companies have to get through an economic downturn like the Great Recession. This led me to inquire how Wells Construction found success to get through the rough times.

 

Screen Shot 2014-09-14 at 2.18.36 PM

 

CJ Wells, the Training and Development Manager of Wells Construction, agreed to have a conversation with me about the impact the changing economy has had on their business. The first topic brought up was the big question of the day – how did they find success in an otherwise pessimistic market for construction? He began to explain that their business sources two main facets for revenue: general construction and Starbucks. One of the first bids (agreement to build) that Wells Construction acquired was Starbucks – an international chain of coffeehouses. This set the stage for a long relationship with Starbucks, one of the factors that kept Wells Construction alive through the recession. Through time, the construction company was able to take over all the planning and building services for Starbucks throughout the Sacramento area. CJ explained, “Although the construction industry has a lot of risk, Starbucks seemed to be recession proof in Sacramento, allowing us to keep our employees in employment and our office buzzing.” When asked whether cyclical or secular shifts have affected the family business, CJ explained that there have been more cyclical changes for the company. Approximately every five years they experience a period of growth, followed by a time of decreased demand for construction services (riding the “economic rollercoaster”).

Besides their relationship with Starbucks, their other source of revenue is in general construction – the other industries that choose to use Wells Construction for their planning and constructing needs. A certain tactic they employed to get through the recession was to focus on developing relationships with certain industries that were expanding. Currently, the veterinarian industry is growing in Sacramento; therefore, Wells Construction has placed a group of employees to strategize multiple methods to become “the” veterinarian construction group in the area. Another industry that was expanding despite the recession was private medical offices; therefore, Wells Construction also put attention towards this avenue of development. CJ made a point to exclaim that 80% of their general construction services are with repeat companies, or recommendations within the same industry. This percentage reveals that their company not only builds for their customer, but they also put effort into maintaining this relationship. For example, one of their recent projects was to build an “Orange Theory” gym in Roseville. After this was completed, Glen (the owner of Wells Construction) paid for a year membership to the fitness center for all of his employees.

 

IMG_6751

Two generations of the Wells Family: (from left) CJ Wells, Clinton Wells, Glen Wells (CEO), and (not part of the Wells Family) Tim Brockway (President/CEO of ASG).

 

Although it appeared that the recession has not impacted Wells Construction as much as I anticipated, there are still challenges present with the construction industry. The first issue at hand that CJ revealed was the continuous struggle to balance cost, quality, and time when it comes to placing a bid on a new project. Taking on the perspective of the customer, it would be ideal to have the construction project completed fast, with high quality, and in a timely manner; however, this is simply not realistic. CJ explained that you can ultimately have two out of three aspects, and not having the right balance offered on the bid could lead to losing a potential customer. Another concern Wells Construction is dealing with is the capability to control the amount of growth the company is experiencing. This is where CJ plays a vital role in the company – handling the growth and trying to keep up with the demand for their services. At first I was perplexed to hear that this incident was considered an issue, but CJ explained that if the company did not handle the growth well, it could be a swift death sentence to Wells Construction. The employee turn over rate is extremely high right now, and that also poses as an issue. Hiring employees to keep up with the projects they are accepting is risky, especially when this growth period eventually slows down and they are forced to re-evaluate the size of their team. Amidst this growth, the construction company recently decided to open a new office in Irvine, CA, which comes with a big potential for increased profits, although the stakes are evidently higher as well. Developing the infrastructure and work force to maintain this office is up to CJ – not only is their money invested in this new office, but so is their credibility as an upcoming force in the construction industry.

If Wells Construction can use this time of growth to their advantage, CJ anticipated that the company could begin to accept larger projects (right now the projects are no more than a couple million with a range between 8-20% profit). To take on a large-scale project worth more money, the company would need to acquire additional insurance, and consequently, take on more liability. The company is not ready to make this move; however, with time and positive development – it could be in the near future.

 

Screen Shot 2014-09-15 at 3.03.26 PM

A snap-shot from the Wells Construction website.

 

Wells Construction, the family construction company from Roseville, California, has worked its way up the business ladder to increase its profits, hire a larger workforce, and open a new office location. The recession was not a complete blow to the company as Starbucks was the lifesaver that kept them through the storm; however, their growth from this new era of demand for construction seems to be the ultimate test of the company’s strengths.

Sources:

http://wellsconstruction.com

http://clients1.ibisworld.com/reports/us/bed/default.aspx?entid=84

Clipping Coupons, Cutting Spending

When the economy sinks deeper, consumers tend to get creative about finding ways to cut on spending. 

Equipped with scissors, printers and shopping carts, in recent years many Americans have hunted for online coupons to save on products like canned soup, toothpaste and cookies.

While consumers print and clip their coupons, COUPONSeconomists closely watch their activity, trying to link it to economic growth or decline. 

Over the years, they have calculated that the more people print coupons, the worse the economic pressure they are feeling.

Originally intended as a form of advertising, coupons became a way for some customers to increase the value of their non-monetary exchange for groceries and goods. [Read more…]

Minimum wage hikes suggest optimism for economic growth

Garcetti announces his plan for a new minimum wage this Labor Day weekend. | LA Times

Garcetti announces his plan for a new minimum wage this Labor Day weekend. | LA Times

Los Angeles hotel owners got a jolt early this year when Mayor Eric Garcetti announced a plan to boost the minimum wage for 10,000 housekeepers, bellboys, janitors and other menial workers at the city’s largest hotels from $9 to $15.37.

Now Garcetti wants to bring that pay raise to all industries across the city, ultimately aiming to lift 567,000 people out of poverty. He said in a statement:

Our city has always enjoyed the greatest prosperity when everyone can afford to support themselves and contribute to our economy.

By improving the quality of life for the working class, the mayor also aims to boost the economy. Will it work? And conversely, what can the minimum wage tell us about the economy’s health? [Read more…]

Women As Economic Indicators

Women consumers are a driving force in the market place, constantly shaping market patterns and trends. While new fashion and beauty trends seem to constantly be surfacing, many of these fashion trends aren’t as random as once thought. Though the latest issue of Vogue many seem like a collection of designer ideas and fashion revolutions much of women’s style runs in cycles. Further research into these cycles has revealed economic ties to woman’s buying habits.

Lipstick_mainOne of the more widely talked about economic indicators tied to women is the lipstick index. Leonard Lauder argued “that during difficult economic times, women will increase purchases of lipstick and makeup and decrease purchases of higher priced goods like shoes and handbags”. There are two major theories that support why women would increase their makeup buying habits in hard economic times. The first of these theories looks at the self-esteem of women and the need to have luxury goods even when unaffordable. Women’s fashion is branded from a desire standpoint not a need standpoint therefore women view items like handbags and shoes as items that increase their self-value. While money may run short women’s opinions of their own self-worth does not diminish at the same rate. This leads to women seeking desire goods that fit their new price point, such as lip stick.
The second theory looks into the reasons why women buy makeup to begin with, with one of the main reasons being to increase their attraction level. A study conducted by a team of psychologists looked into this trend and noticed that as a recession occurred the number of men women found attractive decreased. This occurred for several reasons with the primary reason being women look for financial security in a partner as a major trait. Business Insider found that the “results of four separate experiments showed that women were likely to increase purchases of lipstick, perfume, and other products that might enhance their sex appeal.” While handbags and shoes might also enhance a women’s sex appeal, during economic downturn these expensive items fall into an unaffordable price range.

tumblr_inline_mzyssht3x51sx9ifa
Women do not affect the market only with beauty sales but with fashion as well. George Taylor in the 1920s came across the Hemline Index. This index looks at the length of women’s garments juxtaposed to the state of the economy. In his research he found that the better the economy was doing the shorter the hemline fell on women’s clothing. Many economists have looked at this theory and found differing reasons. Some found that a longer hemline in economic downturn was a result of women wanting to appear more professional as they looked for jobs or tried to keep their jobs. This was backed up with dramatic length changes on women’s clothing during the 2008 financial crisis. On the opposite end other economist found that the shorter hemline in good economic times was a result of more disposable income being spent on partying and social use.

ku-xlarge
Women’s buying habits highlight a third economic indicator the High Heel Index. Dr. Trever Davis found that “Usually, in an economic downturn, heels go up and stay up – as consumers turn to more flamboyant fashions as a means of fantasy and escape”. While in the previous study it was shown that women tend to shy away from buying expensive items like shoes; this study has shown that those who still do purchase shoes purchase higher ones. The high heel has been correlated with a women’s confidence and an overall put together presentation. The association has led women to purchase higher shoes in harder times to in a way suppress reality.
Women have always been large consumers in the market place and studying their consumption patterns has given economist a different way of looking at the economy. While the standard economic statistics and figures are still used as the most credible way to gage the state of the economy looking at trends such as these provide a different perspective.

Indian Gastropub Adds Spicy Twist to Downtown LA Buzz

“The most badass chicken tikka out there,” that’s what Badmaash LA, Downtown Los Angeles’ revolutionary Indian Gastropub, offers. Mention Indian food and the natural instinct is to think of a staid restaurant with faded red carpeted floors and sitar-music.

Enter Nakul and Arjun Mahendro, the two Canadian Indian brothers who started Badmaash. Serving traditional indian food icons with an innovative twist, the brothers have brought subcontinental flavour and western favourites to Downtown LA (DTLA) while taking advantage of the area’s economic upswing.

“We wanted to create a cool restaurant with great food and a fantastic atmosphere,” says Nakul.“Something that pays homage to our past but departs from the traditionally drab Indian restaurant. We want to redefine the indian dining experience as a whole.”

image Walk into Badmaash and it becomes instantly clear what the brothers are talking about. The familiar overwhelming buffet-style dishes are replaced with portion sized plates paired with a selection of hand-picked artisan beers. The LCDs blaring Bollywood songs are gone, swapped for a cool, silent Indian classic projected on the large wall. A set of Warhol-like portraits of Mahatma Gandhi wearing coloured aviators lines the wall.

Debuted in May 2013, the two ‘americanized desi boys’ have turned Badmaash, the Hindi word for ‘badass,’ from a risqué and somewhat idealistic concept into a veritable business. Almost a year later, the buzzing eatery, has put the figurative spice back into the subcontinental cuisine.

Badmaash’s location in Downtown LA, I found out from Nakul, puts it at the start of more than just a culinary revolution. The brothers entered the Downtown market just as it began gaining speed. In 2000, the Median Sales Price for DTLA hovered between $150K and $200K. After a steep decline during the recession worsened by its own micro-housing bubble, DTLA rates climbed back to almost $550K by end 2013. 

Median Sales Prices are steadily rising as the economy recovers and Downtown becomes more popular

Median Sales Prices are steadily rising as the economy recovers and Downtown becomes more popular

Debuted in May 2013, Badmaash has managed to evade most of the economic instability. Today investments in Downtown LA are “sound and growing” stresses Nakul. But business has not always been easy. The brothers’ previous Toronto-based restaurant, Jaipur Grille, felt the effects of recent economic turmoil. The restaurant group that worked with Jaipur Grille, Nakul explains, had to accept significant losses and dramatic dips in business.

Indeed, though many industries worldwide slipped into decline after the 2008 Wall Street Crash, few were as hard-hit as the restaurant industry.

According to data released by the Federal Reserve and the Bureau of Economic Analysis, overall consumer spending dropped dramatically from 2008 through 2010. In addition, a comparative analysis by Beacon Economics details how taxable sales for the City of Los Angeles, which bottomed out in the Q2 of 2009, saw a 18.6% decline from peak to trough. A triple hit, lowered consumer spending complemented by heavy job loss and the inherent increase in available time to cook, meant few people were inclined to eat out.

Consumer spending dropped dramatically during the crisis. Restaurants suffered significant losses in 2009 in particular.

Consumer spending dropped dramatically during the crisis. Restaurants suffered significant losses in 2009 in particular.

In my conversation with Nakul my questions about the economy’s impact required little elaboration. With spending reduced to bare-necessities, eating out became a luxury most could no longer afford. 

More interesting, however, was his positive outlook.

“This is an extremely great time for the U.S. and an event better time for Downtown LA,” he said. “Everyone is look to Downtown LA as the next great American city.”

In the last few months, publications like GQ have written about Downtown LA, painting it as a crossroads of innovative cuisine, alternative shopping, and an edgy, somewhat nostalgic culture. It was interesting to hear about the area’s rise from someone with an on-the-ground perspective. Nakul explained that Downtown LA is growing rapidly, just less noticeably.

Traditionally, the Downtown economy is restricted mostly to the daytime, catering to the office workers that file in and out of its high-rises each day. By night, its derelict and supposedly ‘crime-ridden’ streets make for a disheartening vision.

Yet, as Nakul points out, the area is rapidly changing. According to a survey by the Downtown Center Business Improvement District, there was a 6% rise in Downtown’s population between 2011 and 2013. More than 92% of people reported they ‘lunch out’ at least once a month. Notably, 93% of permanent residents (i.e. not employees or visitors) dine out at least once a month. Finally, close to 68% of respondents said they wanted more mid-level restaurant options.

Web

Asked what the increase in population might mean for Badmaash, Nakul underscored that heightened demand means more supply must be created.

“The more people that move here, the more demand for eating options. The more restaurants that open up, the better” he said. At such an early stage there is still ample opportunity and room for expansion without the risk of market saturation, it seems. 

Nonetheless, Downtown property rates have “skyrocketed,” according to Nakul. With the openings of establishments like the Ace Hotel, Downtown’s micro-economy is certainly on the rise.

Economic indicators notwithstanding, I realised from my conversation with Nakul that Downtown’s business environment is actually much more promising for small businesses than that of its West LA counterpart.

The saturated, unfamiliar, and expensive market of Beverley Hills or West Hollywood is hardly conducive to starting an unconventional restaurant concept, especially without financial backing.

“In Hollywood, the chairs alone were $1000 a piece. It would have completely changed our business. In Downtown, we found ones for $100,” Nakul highlighted to me.

Interestingly, though Downtown’s low-cost economic environment made it easier, the City of Los Angeles’ policies, as other interview posts have mentioned, left much to be desired. 

Nakul described the process of opening a restaurant  in LA as “very bureaucratic, almost inaccessible.”

More importantly, he emphasised the need for more support for starting small businesses, particularly in a budding micro-economy like that of Downtown LA. Support from the Downtown Business Improvement District helped push through a lot of Badmaash’s permits. Beside this however, Nakul stressed the need for a city- or country-wide program to provide micro/local economic stimulus through support of small businesses. Assuaging the need for capital through long-term loans,while lowering the barriers for entry are essential if Downtown is to continue growing, he said. 

“Restaurants can become a sinkhole of money, a purveying nightmare,” he explained. “Access to capital is extremely important and any restauranteur knows that initial capital investment has to be really small, making funding and low costs all the more crucial.”

All in all, my interview with Nakul of Badmaash LA was enormously interesting and illuminating. As mentioned, Downtown is often said to be ‘on-the-rise,’ but this is only gradually becoming evident. This aside, Badmaash’s and Downtown LA’s burgeoning success points to the ability of unlikely, written-off economic environments to be a huge hotbed for small business success. Could this be extended to entire economies? Who knows…

BaadmashLA is located on 108 West 2nd Street #104 in DowntownLA. Be sure to visit if you’re ever looking for a fantastic place to eat!

Tatsu Ramen-not a traditional fast food restaurant

ramenStarting with 50,000 dollars, Ryu Isobe has operated his ramen restaurant for one year and eight months. He and his partner are planning to open another one in Hollywood area this year.

“This time we will spend 700,000 dollars to build a fine place for my ramen restaurant,” Isobe drank a sip of coke and continued. “I lived in United States for 11 years. I always want to open business or doing something related to Japan. I’m a Japanese.  You know, there are so many ramen restaurants in Japan but here there is not that much,” said Isobe.

According to a report from National Restaurant Association, driven by a stronger economy and historically high levels of pent-up demand among consumers, restaurant-industry sales are expected to hit a record high of $683.4 billion in 2014. There are 17 ramen restaurants in Los Angeles.

When you enter the ramen restaurant, you will find three iPads for self-ordering and self-payment. You just need to hold your receipt and wait to be seated. The high-tech mechanism attracts a lot of young people.

“We only have 29 seats but we could serve 700 people one day during weekends…every customer spends around 15-20 minutes…most of them are college students…sometimes you can see some 30+ customers and even high school students,” said Isobe.

Born in 1988, Isobe graduated from USC business school in 2011. However, he didn’t choose to jump into the ramen business right after graduation.

“I spent almost one year to find a great location…I think that’s one of the most important elements for my business…and also I want to make my ramen taste unique,” said Isobe.

Isobe learned to cook ramen all by himself. He said that he wants to make ultra-specialized Hakata-style tonkotsu, whose preparation is more rigidly structured than most medical practices, a Tokyo-style fusion.

“You can find ramen restaurants in Japan every where and they all taste much better than here…especially the tonkotsu,” said Isobe.

According to abc News from Jan 2012, economists were forecasting even more sticker shock in 2012. The price of just about everything — fueled up bond. From gasoline — caffeine to breakfast is filling up. However, it didn’t stop Isobe opening his first restaurant in May 2012.

As we know, during the recession, consumers spent less on luxuries such as dining out. However, when they did visit restaurants, they purchased lower-priced items. Moreover, consumers have become increasingly health conscious over the past five years, according to PR Web.

“I actually wasn’t impacted by the price or recession. People always need to eat and my ramen only costs around 10 dollars per bowl…we put all ingredients in ramen…it is not expensive,” said Isobe.

Isobe’s ramen restaurant is not the first one on Sawtelle Blvd, but it must be one of the hottest restaurants. He gets lots of emails for franchising every week, but he never replies.

“My goal is to open my ramen fast food chain restaurants all around US as Panda Express. I think we need real fast ramen food,” said Isobe.

As a new comer, Isobe didn’t spend any money on marketing his ramen restaurant. On the opposite, he put more attention on training waiters and designing ordering system.

“All my employees are Americans…they don’t speak Japanese…I spent a lot of time on training them to be a great waiter…I created simple rules for them to follow such as when to add water for customers…I taught them step by step,” said Isobe.

According to a report on restaurants from IBIS world, the single location full-service restaurants industry has bounced back after a slowdown due to reduced consumer spending during the recession. In 2009, revenue declined 0.9%. Over the five years to 2013, IBISWorld estimates industry revenue will grow at an average annual rate of 2.3% to $137.5 billion. Revenue is expected to continue its upward trajectory in 2013, growing an estimated 3.1%.

Isobe never makes a loan from banks nor accept any angel investments. He has a partner to work out all money issues together. Even though Isobe’s ramen restaurant wasn’t impacted by recession economy, he’s still facing challenges. The biggest one is labor.

Another report from U.S. Bureau of Labor shows that California is one of the nine states with highest unemployment rate, which reaches 8.5%. Last year, Gov. Jerry Brown endorsed a bill that would raise California’s minimum wage to $10 an hour by January 2016. Employers countered that a substantial jump in the minimum wage could be disastrous for small businesses, particularly the state’s 87,000 restaurants, according to LA Times. It makes even harder for Isobe to find appropriate employees.

The gains remain below what would be expected during a normal post-recession period due to a range of challenges. However, the restaurant industry will remain the nation’s second-largest private sector employer with a workforce of 13.5 million, according to National Restaurant Association.

“The biggest challenges I’m facing is labor…I hired 40 people in total…it’s really hard to find perfect employees now,” said Isobe.

 

 

 

 

 

 

 

 

 

 

 

Accurate Staging: Building Steady Ground For More Than A Decade

This day and age it is not enough to just want to start a business. You have to want to do something with that business. When Angel Cantu and two other partners decided to open Accurate Staging in 2001, they saw an evergreen approach to their business.

 The company is in charge of creating stages and sets for different concerts and television shows. Most recently they have taken on creating sets for “The Biggest Loser” such as stages where they handle the judging and “background sets” that to the audience, must  look like it has been there forever.

“We built a gym for them and the set and that’s usually a long-term agreement–about six to eight weeks every year. So that ends up being most of the season,” he said. “Then when the season is over, we go out and take it down.”

They use the same method for different artists and groups that Accurate Staging creates stages for concerts. Recently, the company created the entire performance stage for Linkin Park while they were out on tour. The agreement was about six to 12 weeks, where the band buys about 40 percent custom-made parts and rent out 60 percent of the rest of the gear.

 “We have a variety of groups that come to us,” he explained. “We have people like Linkin Park that need our stages for about four to six months, then stop for a few months because they go back to the record studio to create more music. With the older bands, like U2, they need stages year-long because they are always performing at different venues with the same material; they don’t require any breaks.”

 The business has run for almost 14 years, and Cantu stated that for the first seven years of its existence, business was pretty steady–increasing at a rate of five percent every year. When it the recession came about and the economic turmoil that faced most small (and young) businesses, Accurate Staging was not hit as strongly as others.

 “The things about this business is that it’s wrapped up with entertainment. There’s less pressure on this industry because it’s not too hard on people’s pockets and people are always looking to get entertained. That fact is always consistent no matter what the conditions of the economy may be.”

 In fact, Cantu shared that most of the obstacles facing the business were more of internal problems than external.

 The company faced a hard time a few years ago when he was forced to buy out one of the original partners due to embezzlement problems.

“It wasn’t something that we wanted to do, but trust is a big part of the company. It’s probably the most important thing.”

Being seen as a “family business,” Cantu recognizes that 50 percent of the business involves dealing with the employees.

 “One of the key things about us is that we don’t lay off people. We like to have a consistent amount of employees working for us all throughout the year. Because of that, I’ve come to realize that I have to deal my employees the way a parent deals with multiple children: each one has different personalities and different expectations when it comes to what they do,” he explained. “At times their expectations are unrealistic or their attitudes need adjusting so it’s a process that requires a large amount of effort from me.”

 Wherever Cantu puts his effort, it is working for him. And coming into the new year, Cantu has high hopes for his company.

“We’re actually hoping to see a 10 to 15% growth within our business because there seems to be this willingness from people to spend more money on tours and concerts,” he said, “and we’re happy to be able to entertain people and make them feel good.”

Sandwich Island

Sandwich Island sits in the northwest corner of the University Village International Food Court adjacent to an eclectic assortment of family-owned international restaurant options. For the last 20 years, Long Jang Wu has mixed her “made fresh everyday” potato salad, piled on meats and veggies on sandwich rolls, and served students, faculty members and South Los Angeles regulars.

Wu will make her last sandwich on May 31st, 2014 when the University of Southern California begins construction on the USC Village, a $1.1 billion redevelopment project that will transform the University Village into a “vibrant, pedestrian-oriented and safe environment.”

The USC Village will include new student housing, academic space and retail and entertainment offerings, according to USC. In addition, the redevelopment project will create 12,000 new jobs and the university plans to hire at least 30 percent of the jobs from local sources.

Though the university has attempted to help Wu find a new location for her popular sandwich shop, rental space near the university is limited and expensive.

“It’s very difficult to find locations for small businesses around USC,” Wu said. “The university tried to help us find a new location, but the good spots are either taken or too far away to keep the business we get from USC students, which is the most important.”

The university has given the restaurants in the International Food Court an option to return to the new USC Village in three years when retail spaces have been completed. The option exists, but the university hasn’t promised anything and Wu, who immigrated to the United States in 1982, hasn’t known much else other than Sandwich Island.

“I’ve been working here seven days a week for the last 20 years with my husband,” Wu Said. “Maybe we can rent a food truck temporarily, but it costs too much. The truck will set us back $3,500 per month and parking near the university will cost upwards of $1,500. That’s just something we can’t afford.”

On weekdays, Sandwich Island will serve upwards of 500 customers, the majority coming from USC, the largest private employer in Los Angeles County. You can find Wu’s daughter or son manning the sandwich station or cutting vegetables. And Wu is constantly trudging between the refrigerator and the register greeting regulars and meeting first-time customers.

Two large “Cash Only” signs are placed strategically at both the location to order and point of sale. Sandwich Island and many other businesses in the University Village International Food Court only take cash, choosing to avoid credit card processing fees.

“When we began, no one had credit cards,” Wu said. “The evolving technology and the processing fees, ultimately, scared us away from pursuing credit card options, but we definitely thought about the pros and cons.”

Though the cash only option hasn’t impacted Sandwich Island’s business negatively, the Great Recession sure has. When families or individuals struggle with paying the bills, they often take their lunch to work. The more people that take their lunch to work, the less business Sandwich Island gets.

In addition to the recession, an increase in competition, especially from the world’s largest restaurant chain, Subway, has impacted business at Sandwich Island. In a market where awareness is paramount, Subway has the upper hand. And with three locations within a mile from USC’s campus, purchasing a sandwich at Subway might also be more convenient for consumers.

Sandwich Island focuses on word-of-mouth marketing and with platforms like Yelp, the small sandwich shop tucked into a corner of the International Food Court has been able to stay competitive.

“I don’t know much about Yelp, but we have great reviews and that’s where a lot of our new customers learn about us,” Wu said.

On Yelp, Sandwich Island has 107 reviews with an average 4.5 out of 5 star rating. The reviews constantly compare Sandwich Island to Subway noting the cheaper prices and better taste of Wu’s restaurant.

In more than 20 years of business, Sandwich Island has only changed its prices four times. But with the volatility of wholesale meat and vegetable prices, which negatively impacts the bottom line of Sandwich Island, the lack of change might be surprising to some consumers.

“A few years ago, beef was $1.75 per pound,” Wu said. “Now beef costs $3.20 per pound. And the same with salmon. We paid $23 per pound of salmon last week, but I remember when we paid $15 per pound.”

When vegetables aren’t in season or when the weather is colder than usual and farmers struggle to keep up with demand, prices skyrocket. More importantly, prices rarely go down.

“The price of vegetables, in particular, seems to always be going up,” said Wu. “If it ever goes down, it never goes down too much.”

The fear of change, the impact of the recession and the idea of not having a job when USC begins to tear down the University Village constantly weigh on Wu.

“My mind is sharp, my memory is good and I think I can work at least 10 more years, but at my age, no one wants to hire me,” Wu said. “It’s very difficult to find a job and though I’d love to keep the restaurant, it doesn’t seem likely.”