Post storms, smaller businesses struggling

Katrina: After the Storm
Wednesday, March 1, 2006

Twenty-two days after Ron Foreman lost 15 percent of his business as the result of Katrina, things got worse. Hurricane Rita whirled into town, and Foreman had to shut down his business, Bayou Fire and Security, for six weeks. He lost telephone and Internet service for all of that time, and 25 of his 35 employees relocated or took other jobs.
"We downsized and we're starting over again," he said. In business for 18 years, 85 percent of Foreman's work is in fire. He does jobs all over Louisiana and into Texas, Alabama and Mississippi.
Foreman, who is also president of the Louisiana Life Safety and Security Association, doesn't feel like he's any worse off than his fire industry colleagues in the Gulf Coast.
"When you look around and you see someone who's whole home or business was destroyed, one is hesitant to complain," he said. "Most of the [fire and security] businesses in Southern Louisiana lost 50 percent of their customers, and some are never coming back."
Jeff Okun, of Nuko Security, is glad to be back at home and working in New Orleans. On the day Katrina hit, he was scheduled to fly back from New York after attending ISC East. He ended up staying in New York, at a second home, for two months.
Okun's home and business are located in a part of town that was hit with severe flooding. It was several weeks before he could get back into his home.
A self-employed installer who focuses on fire, Nuko started his business 15 years ago. He does both fire and security installations for residential and commercial customers. "My company is small but we do some big jobs," such as fire, security and cameras for Whole Foods grocery store. Before leaving for ISC East, Okun was doing inventory. His supplies, normally stored on a second floor, were on the floor of his garage and destroyed by flooding during the storm. "I lost $200,000 worth of inventory," he said.
Nuko didn't have flood insurance, so his business suffered a major financial hit, but he feels fortunate to be very busy with work.
Industry watchers predicted a great and immediate demand for fire industry work after the storm. Well, the demand is there, especially for larger players who have the employees and the government contracts--or for the self-employed like Nuko, who do not have to rely on other workers--Foreman said, but smaller businesses are having a tougher time capitalizing.
"The federal government is not promoting the small businesses that need their help," he said. What should the government do? "They could start by making those who have the contracts give preference to local businesses. They're supposed to be doing that, but they're really not. We've got more people here from outside of town than from inside," said Foreman.
Work is slow in coming back. Foreman said his biggest New Orleans customer has been waiting for insurance money so they can begin the rebuilding process.
He expects the wave of demand for fire services to start in earnest within the next three months. Once it starts, he doesn't expect it to let up for at least three years.
In the meantime, "A lot of customers are just worried about their roofs. They're still trying to get their buildings dried out."