By Diego Graglia, FI2W web editor
In New York and Los Angeles, the effects of the economic slowdown are hitting hard in one important sector of immigrant communities: small business owners.
A fixture of many New York neighborhoods, the bodega, is fast disappearing from many corners. The president of the Bodega Association of the United States claims that “every day, two or three bodegas close in New York.” High rents and leases that force them into rent hikes are their main enemy.
In L.A., vendors at the Grand Central Market — many of them Latino — are facing a similar situation. Business is down, way down, and they can’t meet rent payments.
A survey done by the USA Latin Chambers of Commerce said rent hikes and increasing operational costs threatens to put 61% of New York City bodegas out of business, according to a recent article in El Diario/La Prensa.
One example is Luis Sánchez, a bodeguero on Amsterdam Avenue in Manhattan who says his rent goes up 7% every year. He started paying $2,940 a month three years ago and now his rent is at $3,400 — he’s even had to fire his own brother recently.
Sánchez told El Diario:
If the landlord doesn’t want to negotiate a new lease, with the next increase I’m going to get to the extreme of not being able to generate enough to pay the bodega’s expenses.
According to the article, there are 16,500 bodegas in the city and 85% have Latino owners; Latinos own between 42% and 45% of the 185,000 small businesses in New York.
Lost in the din about hundreds of billions to bail out banks, the auto industry and financial institutions is the fact that the 9,000 New York bodegas are becoming a dying breed. If something is not done, it won’t be long before they become extinct, leaving thousands without a means of support.
The disappearance of bodegas is the economic crisis hitting at the most basic level, and its impact in human terms is very real. After all, since the mid-1980s, small businesses have been the creators of the majority of new jobs in the city.
Ruiz interviewed Ramón Murphy, the president of the Bodega Association, who said that every time a bodega closes, “two or three families suffer.”
“Last year, 137 of them went down only along Broadway from 230th St. to 197th St.,” Murphy said. “Hundreds of bodegueros are throwing in the towel. Every day, two or three bodegas close in New York.”
[In addition to rent and cost increases, Gov. David Patterson proposed in his budget plan a higher tax on soft drinks and their containers which would have impacted bodegas, whose owners protested Thursday at City Hall. Patterson quickly admitted his idea wasn’t likely to pass in the State Legislature.]
In L.A.’s Grand Central Market, in the meantime, the era of taquerías full of customers and heavy traffic in front of the fruit and vegetable stands is over, La Opinión reported.
“We’re almost working for free,” vendor Jerónimo Reyes told the newspaper. He spends almost $10,000 a month on the rent for two stands.
With sales down by 50%, over 30 of the market’s vendors decided not to pay their February rent to try to force the landlord into renegotiating their leases. Some have received eviction notices as a consequence. Armando Ramos, another vendor, threatened,
Everyone knows we signed a contract and we have to fulfill it. What we want is to reach an agreement with the owner (Anne Peaks, owner of The Yellin Company), for her to tell us when she wants her market empty so we leave it for her like that.
“If we had an income,” Jerónimo Reyes added, “there would be no problem in making our payments. But the current situation is difficult.”