Adam Davidson grew up in Greenwich Village when the rent was cheap and the neighborhood was full of funky small businesses. Today, the Village is super gentrified and full of luxury boutiques. But a few mom-and-pop shops have managed to hang on. In his New York Times Magazine column this week, Davidson returns to the neighborhood, and tries to figure out how the mom-and-pop stores hang on. Here's an excerpt.
...five years ago she probably could have sold her lease to one of those brands — as other, more financially minded entrepreneurs in the area surely did — and cashed out. Bowman countered that closing her shop would be like shutting down her life. She's currently looking at retail space nearby.
I wondered why Bowman, like her fellow proprietors, was disavowing economic theory and not trying to maximize her profits. Then I remembered one fascinating statistic about our economy. There are more than 27 million businesses in the United States. About a thousand are huge conglomerates seeking to increase profits. Another several thousand are small or medium-size companies seeking their big score. A vast majority, however, are what economists call lifestyle businesses. They are owned by people whose goal is to do what they like and to cover their nut. These surviving proprietors hadn't merely been lucky. They loved their businesses so much that they found a way to hold on to them, even if it meant making bad business decisions. It's a remarkable accomplishment in its own right.