Recession? Locals say business is booming
By JENNIFER GOLDBLATT
© St. Petersburg Times, published April 16, 2001
There is something that a local manufacturer of customized motorcycles, aluminum fencing and scuba diving equipment have in common.
From where they're standing -- in Spring Hill, Zephyrhills and Hudson -- talk of a recession seems a little overblown.
Consider Randy Manescalchi,, owner of Royal Ryder Inc. in Spring Hill. For five years, he's been assembling customized motorcycles in a 1,000-square-foot building. Sales of these cycles -- which cost up to $45,000 each -- were so hot that he decided to start making the frames and doing the paint work in-house. Those were services that he'd been previously contracting out.
Then there's Bill Woodard, president of Alumni-Guard, a Hudson-based ornamental aluminum fencing manufacturer that sells to housing developers all across the country. He just built a 22,000-square-foot building so that he could start making his own powder finishing for the fencing.
Dennis Bulin, owner of Zeagle Systems Inc., just bought a 15,000-square-foot building, doubling the size of his space. He expanded so he could design and make his own line of scuba-diving regulators, the parts that regulate the flow of air from the tank to the diver. Those wereparts that he used to have supplied to him. Bulin, who is coming off his best quarter of sales the company has had since it began in 1979, is expecting a 15 percent to 20 percent revenue increase just from that expansion in the next year alone.
It seems that despite talk of a recession, people still are walking into scuba shops and plunking down a couple of thousand dollars for gear. They're still buying homes with fancy fencing, and they're still buying motorcycles personalized to their liking.
These Pasco-based manufacturers all bet that investing in their company's growth will pay off even as news of layoffs, earnings shortfalls, low consumer confidence and unemployment growth crowds the headlines.
"We hear this doom and gloom, and there are a lot of people that lost jobs that would be buying our equipment, but not everybody is hurting," Bulin said.
The Economist tracks the occurence of the word "recession" in the New York Times and the Washington Post. The weekly magazine reported in its April 5 issue that its R-word index -- which has correctly tracked the past two recessions -- had "started flashing red." There were 650 mentions in the first three months of 2001 -- that's three times its level in the middle of last year.
But perhaps the R-word just hasn't been as pervasive in Pasco County.
When John Walsh, existing business manager of the Pasco Economic Development Council, surveyed 78 local companies, and asked them whether they thought there was a recession, 74 percent said no.
"There's been so much growth over the past few years, and the kinds of manufacturers are so diversified here, that maybe it's just not going to hit our economy the way that it's characterized in some of the large news reports," he said. During the EDC's 1999-2000 fiscal year, businesses in Pasco added 105,000 square feet of building, 184 employees and invested $24.1-million in their companies. Now, only halfway through the EDC's fiscal year, Pasco companies have built 194,000 square feet, added 139 employees, and poured $13.7-million back into their businesses.
Richard Streeter, executive director of the University of South Florida's office of economic development, concedes that perhaps the diverse base of small manufacturers could insulate it from the brunt of an economic downturn.
"All I keep hearing is growth in the area, growth in the area, growth in the area," he said. "My sense is that at a local level, that's probably going to continue. There's going to be pockets where it's going to step backwards, and pockets of layoffs, but the momentum is still in progress."
That's not to say that it's easy street for the Pasco companies that have works in progress. They still must contend with the rising cost of doing business.
Woodard of Alumni-Guard says he has seen his health care benefit costs shoot up 18 percent in the past year. He used to pay for his employees' health insurance. But now, he said he has had no choice but to pass that rate hike on, with his workers now paying that 18 percent. Also, the cost of auto insurance and liability rates for his fleet of 50 cars has doubled in the past year.
The lowered valuation of the dollar worldwide last year took a toll on Bulin's exports -- which make up 35 percent of his total revenues. Still, the demand from U.S. dealers has been strong enough to compensate for the foreign fall-off. He says that once the summer tourism season gets into full swing, that will be the real test. But based on what the 500 dealers he sells to are telling him, he's optimistic.
"I'm not sure that it's as bad as we're led to believe," Bulin said. "I hope I'm right."
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