“We went to the ends of the earth to avoid layoffs, but we just couldn’t do it.”
Scott Miller, comptroller of Lincoln Industries
“Tax credits for new jobs don’t do squat for me.”
Mike Van Sickle, administrator of the nonprofit Bethany Lutheran Home of Council Bluffs
“Our long-term philosophy is to take care of our employees and they’ll take care of our clients. . . . If you performed well, you got a raise.”
Nikhil Mehta, president of Eat Out Now Inc.
By Steve Jordon
WORLD-HERALD STAFF WRITER
When consumers stop coming in your door, when government regulations raise your costs, when your main customers reduce their orders, it’s time to think survival.
Tuesday, about 30 business managers met for a “Surviving This Tough Economy” workshop. Some said that although the past year’s medicine has been tough to administer, there are signs that the cost-cutting bandages, crutches and therapies may be helping their companies’ economic ailments.
Others said the prognosis still is too uncertain to think about resuming normal activity anytime soon.
For Nikhil Mehta and José Partida of Omaha, partners in Popeyes franchise holder Eat Out Now Inc., the recession began trimming sales about the same time they started operations in 2008.
They closed a Lincoln restaurant because it was losing more money than the rent payment they now make on the vacant building. They halted plans to double their number of restaurants to 22. They renegotiated contracts with suppliers, from food vendors to trash collectors.
They accepted that 2009 would be a money-losing year.
But Mehta and Partida said they also bought a new cash register system, boosted employee training, gave incentive raises to deserving employees and continued making plans for the future, such as introducing a new fast-food brand to the region.
“We know what we’d like to do when the economy returns,” Mehta said.
The workshop, sponsored by the Marcotte Insurance agency and held at Anthony’s Restaurant, featured tips on reducing insurance costs and risk exposure, legal warnings from lawyer Scott Moore, a discussion on the economy by Creighton University economist John Deskins and a question-and-answer session with Rep. Lee Terry, R-Neb.
Mike Van Sickle, administrator of the nonprofit Bethany Lutheran Home of Council Bluffs, said government efforts to generate jobs won’t necessarily help every employer.
“Tax credits for new jobs don’t do squat for me,” he said, referring to one option federal lawmakers are considering.
Meanwhile, Van Sickle said, some experts estimate that proposed cuts in Medicare benefits would force 70 Iowa nursing homes to close, putting 3,500 employees out of work.
Van Sickle said he has looked at every possible cost savings that won’t lessen the care his clients receive, down to studying whether disposable or washable wash cloths are cheaper. Yet he must hire two registered nurses just to handle the paperwork required under government rules, which he said do nothing to actually benefit clients.
For Lincoln Industries, a 56-year-old metal finishing company, the recession hit home when customers, including the Harley-Davidsion motorcycle company, cut orders sharply. Comptroller Scott Miller said the company was forced to lay off workers for the first time in its history.
Other cost-cutting steps by Lincoln Industries included furloughs, suspending the company’s match for employees’ 401 (k) retirement savings and replacing its wellness program’s annual mountain-climbing expedition to Colorado with a fitness outing to Platte River State Park near Louisville, Neb.
“We’ve become a lot more efficient,” Miller said. “Companies grow, grow, grow, and now it’s managing the little details that allow us to do more with less.”
He said business may be recovering enough that the company could hire some people within six months, but even that’s unsure. As for restoring benefits such as the 401(k) matching program, he said, “every day we review that.”
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