Locally owned shops make most of changing market

An increasing amount of national franchises are calling Cedar Park and Leander home, forcing locally owned businesses to sink or swim in a rapidly changing market.

Costco is the latest in a long line of major retail outlets to make plans to locate to the area. The big-box store is slated to open later this year, adding another broad competitor that long-established entrepreneurs must overcome.

The keys to success vary by owner and industry, yet the operators of these mom and pop shops continually cite one factor that differentiates them from the competition: customer service.

But even strong service is not always enough to overcome lower prices. O'Leander Cafe closed in May after seven years of operation due to high overhead and lack of sales.

Former O'Leander Cafe owner Loretta Warner warns small businesses that new, national competition can often take a toll, even if only temporarily.

"Everybody wants to try the new place in town, and it takes enough away from the family-based shops," she said. "Once people realized the new place isn't any better than O'Leander, it would take time to recover after that."

Keeping customers consistently happy can also be tricky, Warner said, as menu changes can please one regular and infuriate another. That does not even take into account what it takes to keep ahead of the competition—a job in itself, she said.

Warner hopes someday to reopen a smaller operation that focuses on a few select items, including her pies, she said. She will likely remain in the area, Warner said, despite having to close O'Leander Cafe.

"We did have some great customers, and that's what I miss the most," she said.

Customers come first

For all the struggles, there are many Cedar Park and Leander businesses that have survived and even thrived for decades. Cashway Building Materials is one of the most notable longtime family-owned shops in the area, serving Leander for nearly 30 years.

The hardware shop started off as a lumber yard for contractors but quickly expanded to include a retail operation, said general manager Mitch Bledsoe, whose grandfather started the business in 1984. As the population increased around the once-rural shop along U.S. 183, Bledsoe said the business also had to change.

"We went from farmers and ranchers to homeowners, so it definitely affects the products we sell," he said.

Small businesses must be versatile to compete against big-box competitors, said Joe Harper, director of the Texas State University Small Business Development Center. That is particularly important for stores such as Cashway, he said, which is competing against the new Lowe's hardware store down the street.

"It's really big when you're talking about a contractor or subcontractor whose time is money, and getting it right the first time is important to them," Harper said. "They tend to go with consistency, quality of supply and rely on the knowledge of the person behind the counter."

By being willing to embrace change, small-business owners can better compare themselves to their big-box counterparts to determine potential competitive advantages, he said. That difference is often what separates those that succeed from the 50 percent of small businesses that fail within the first five years, Harper said.

Max Hudson of Hudson's Jewelers in Leander follows a similar model. Hudson opened three years ago, having previously operated a location inside Lakeline Mall. But before that, the jeweler dedicated the majority of his 40-year career to repairs, a skill set that comes in handy when sales are down, he said.

"I have been in this business long enough to know when the economy is good, people will buy, and, on the other hand, when the economy is slow like the trying times we've been in, people will resort to repairing rings rather than buying new," Hudson said.

Networking necessary for success

Building a customer base requires going beyond the business and into the community, said Mary Bradshaw, Leander Chamber of Commerce president and CEO. Otherwise, customers often do not know what to expect from small businesses, she said.

"You can't sit at home waiting for the business to come to you," she said.

Dr. Oliver Lou of Cedar Park-based Signature Eye Care is a member of the Leander and Cedar Park chambers. He said he places a particularly high value on the Cedar Park chamber's leadership program, from which he and seven of his employees have graduated.

"A business can only grow as much as you can drive it, so being developed as a leader raises the level of how successful your business can become," he said. "It teaches all assets of the city, so you truly understand the community you're in, and it's much easier to connect with patients."

Other business owners rely on word of mouth to help trigger business. For 20 years, Cyndy Barron has worked alongside her husband, Floyd, to operate Barron's Vacuum Center and Cleaning Supply in Cedar Park. Much of what they provide is education, she said, that is not offered in bigger stores.

"We try to make sure you made out better because you came here," Barron said.

There is often a difference between national retail shoppers and those who frequent local outlets, Barron and Bradshaw agreed.

"You always know what you're going to get when you walk in a chain—it's usually pretty consistent all over the country," Bradshaw said. "But, if you want to talk to an owner, you can't do that [at big-box stores]. I think people are always going to want that personal care."

Power of the perks

Economic incentives often help cities attract big-box retailers, while smaller stores typically are not afforded similar financial perks.

But there are some resources for small retailers. Aside from networking at local chambers of commerce, groups such as the SBDC and nonprofit service Score Austin counsel small businesses with various ranges of experience. There are also certain municipal and state incentives available.

Cedar Park, for example, provides reimbursements to businesses along the US 183 corridor that improve the beauty and safety of their properties. Dr. Mo Jahadi of Chirofit Wellness Center serves on the city's 4B board responsible for distributing the beautification grants.

The program expanded this year to include more businesses within Cedar Park's primary business corridors, Jahadi said, and he would like to push for more economic development money to go toward small business. In the meantime, it is important businesses learn to excel where their larger counterparts fail, Score Austin Chairman Carlton Smith said.

"If you have a community where Sam's [Club] and Costco come in, that means you're growing and growing fast," Smith said. "It's also an indicator you need more small business because you are growing, so there's going to be more specialties."

There is still nothing that can replace the convenience of parking immediately outside the store's front door, said Barron, who does not rule herself out as a customer of larger stores.

"I might actually venture into [Costco] if it's convenient for me," she said. "I wouldn't buy a vacuum from them, though."