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From: Lance (Economic Research Study)
Date: 28 Jul 2003
Time: 00:51:07
Remote Name: 66.82.52.225
South Western Colorado market survey. We have been spending many hours surveying the market for car washing and detailing in the South Western Region (region # 9) of Colorado. Pouring through data, seeing the tourist sites, and understanding the market there. Meeting with officials, business people and visiting businesses we learned quite a bit about the region and the future prospects there for WashGuys. One of the main cities we took data from and drove around talking to real people there was the City of Cortez. Which is just North of Four Corners and is a big trade partner with Farmington, NM and sees a lot of tourist traffic traveling to the state parks and federal parks there, namely Mesa Verde Cliff Dwellings. It also receives traffic traveling to and from Durango and Telluride. First off the numbers and population stats look good to us in that 35% of the population is 25-54 and that is both our age range to hire from and our biggest marketing sector for car washes and detailing services. Up the hill and around the corner in Durango that stats were a little higher as retirees with money have moved in there. Higher age and higher economic socio status. Good money flow from that group. Also it has driven up housing costs. Durango imports most of its labor from Cortez and about 5000 people come into work in the city every day and only 800 leave to work each day. Cortez has a huge Navajo population and they have mingled with others and provided a good strong and very reliable base of labor for many non-techy type jobs. One-third of the population rents and does not own homes and that number is growing as retirees move in and drive up property values making it difficult for local young couples to buy homes. Much of the data we searched out from Fort Lewis College matched our findings and observations. http://www.soba.fortlewis.edu/sbdc ----- The population increase of Denver is matched in South Western Colorado with about 8% in the last decade increase. From 2001-2002 up 1.78%, strong growth. Statewide Colorado saw about 1.5 – 1.6% over all. And you can see that growth in Montrose, Grand Junction, Boulder, Parker, Colorado Springs, pueblo, Greeley, Fort Collins, Aurora, Denver Highland Ranch, Loveland, etc. Many of those moving in are doing so with second homes for Summer to get out of heat in places like Vegas, Arizona and lower NM. It is a Country Type living and the family values and community is strong and very nice. Safe place. Only San Juan County declined and drastically at 2.13 %, which is a small-populated area and therefore the numbers are skewed. Demand for labor is up and unemployment is down. Increased demand for labor exceeded 16% since 1999 and job labor rates climbed and the demand was mostly in retail and in services for the wealthy older people moving in. Also in tourism as increased after 9-11 since most of the area is traveled to by automobile and tour bus. They expect another 4% increase in the next five years for labor, meaning labor rates are improving and therefore quality of life is improving. 17% of the area is owned by Native legitimate Indians and nearby the Ute Tribe has a casino, which is one of the largest area employers. The history of the area was of course Mining, Forestry, Agriculture, but today those categories only employ 7% of the population. They grow Alphalfa and pinto beans there in Cortez area, agriculture accounts for only 3-4% of employment and of that much is seasonal. Durango has about 14,000 people, Cortez 8,000 and Pagosa Springs 1600. Those cities had a 4% growth in last four years. Inflows of income from employment to the area include Federal and State government payments for parks and Indians of 17% of total. Services represent 31% Retail 18% (not including hotel and restaurants). Construction is good at 15%. In retail car sales and automotive are huge 22.8%, Food 16%, Builder Materials 16.8%, General Retail 12.8%. Sources include many but check out http://scan.org/ceds/ceds.htm Center for Business Economic Forecasting. Inflows of money to the area include Lodging, Restaurants, Construction and tourism. Also money from manufactured products of smaller manufacturers. Government payments to employees and projects in the parks. The most circlerable money comes from comes from local construction of homes and upgrades. Pagosa Springs we found interesting in that there is a new buyer coming into the area for homes. Looking for “Traditional West” type living. This is very interesting as the area had originally been cattle feed, timber, Minerals, wood products which came to be and easily traded with lower lands and farming communities and mining towns. In the last twenty years and after a big decline for mining minerals in the 1970 era, even wood products were not wanted. Wages also decreased and Pagosa re-invented itself now it is similar to resort type mountain towns with shops and real estate opportunities. Growing very high end but making it difficult for locals to keep their kids staying in the area, they cannot afford the homes now with price increases from retirees and second homebuyers to participate in the upscale area. Of course with that it has taxed the infrastructure and hwys and roads, major projects making travel difficult and dusty as hell. Which is excellent seeing as people can afford detailing services and every car is dirty after one day it has been washed. http://www.detailguys.com . On the other side of the area leaving the north west corner of the Southwestern Colorado region is Dove Creek, with a higher end area southeast of there between it and the road leading to high end skiing at Telluride. The McPhee reservoir has some very large nice homes with land and boating available. Great little retirement area in that area with money flow. Rico also gets water from reservoir and they have about 8,000 people there. Delores has some small manufacturing and has always been that type of area previously with the mills and mining for Gold, Silver, Copper, Lead, Zinc, and believe it or not what Saddam tried to buy from Nigeria, Uranium, mining. Auto sales today make up 64% and this is good news. New cars mean more car wash sales. In the area were many car washes. All nice and well kept, people like clean cars there throughout the region, except the Indians did not appear to care about clean cars that much. La Plate County consisting of Durango, Ute Indian Reservation and Bayfield have all had growth both from population increases from new borns and move ins. Biggest is Durango which is quickly becoming a Park City Utah, Jackson Hole Wyoming, Whitefish Montana, type of an area. 1.2% annual growth. Last year we met a gentleman whose sons build high end log cabin houses there and were doing well. Also of interest is the problems with fire after droughts and thunder and lightening storms. The state park of Mesa Verde Cliff Dwellings had some five fires started by lightening with in a two day period and it is always a concern with Durango. The nearby cabins are quite vulnerable and the area is super careful and very pro-active with fire prevention from campers and tourist folks and very fast responding to natural lightening fires. There were 22,000 lightening fires in the western states in 2001 alone, many in the four corners and Colorado Plains and Mountain areas. Water issues are not a problem in the Cortez area but are in Pagosa and Durango. The reservoirs near Cortez have very high up the food chain water rights, but willfully participate in voluntary restrictions resulting in an immediate reduction of 20%. Way to go. This same program has been implemented in Northern Colorado and Pueblo, Canon and other parts with excellent success and preventing further law suits from down stream states which are starving. Farmington, NM is mission critical and surely Santa Fe, Las Vegas, Gallup all worried. If you will remember the water issues and fires last year and the issues with the rivers of Colorado, Arizona and NM you will recall the seriousness. Cortez’s water restrictions are similar to the NJ, PA, VA, MD, CA, MT, WY class two drought restrictions such as watering lawns on certain days and hours, washing cars is prohibited meaning carwashes with reclaim are doing well there. Auto sales in La Plate offer 27% of all retail sales even though there is a Super Wal*Mart in Durango, and lots of mom and pop specialty stores selling all kinds of nick-nacks you might enjoy. Yes not to be out done by NH or Maine or Vermont antiques too. Durango is a bit unfriendly to tourists which is interesting. Delores is 50% services and Durango has a problem keeping quality people to help to help the wealthy home-owners with handy man services and tradesman work. Inflows of Delores are similar to the region and 27% retail. Growth is 2.66% in population last three years. It appears to be all good. But our labor most likely will come from Cortez for the region. In San Juan County they use an interesting term “amenity migration” Where residents buy second homes to enjoy the real rural type of life with nearby shopping and anything they would want. Go read the Magazine Log Home or Country Living some time and you will see what has been started. Blame it on Oprahs higher-end sector or Martha Stewart her self, either way this American Dream lifestyle she created has done very well for many area, and it is most obvious in Southwestern Colorado for sure. Similar to many of the fine homes in Ojai CA, Santa Fe NM, Show Lo AZ. Martha Stewart you have to love what she has done to transform the American Dream for so many. Many of these residents are seasonal in that area. San Juan was a gold town area in the 1870s. Not quite rivaling Gold Rush CA area along interstate I-80 but close and the area has a resemblance of the area. One issue again there is the kids cannot afford the homes and need to live down the hill or move somewhere else, such as Albuquerque or nearby areas of Utah such as Montecello, Blanding or Aneth. We had the chance occurance to talk with some young adults who had friends in those areas who had moved and went on Friday night to visit them, they saw our truck and called us on the cell phone and asked “Do you Party?” We just laughed and said sure? Us party, like we have time? Anyway that question had an interesting meaning. Do you stay out all night, do occasional recreational drugs and drink. No we don’t. Anyway that reminded us of a conversation we had with the City of Cortez Economic Development Association director Bruce A Johnson, who admitted to us they had a drug problem and even had people making crystal meth in hotel rooms that they rented and advised us that the drugs were made locally and affecting crime rates. Drinking was also an issue with Indians and young white kids getting into mischief that caused several horrific accidents over the years on all the two-lane roads. Lots of car wrecks there, even witnessed a tourist making a slow left turn in front of a local teenager in a Nissan Sentra who broad sided them. Good place for a body shop or tow company. In those Utah cities where the kids are migrating to so they can afford to own homes there are kids hanging out on every corner and everyone knows everyone. The entire area is challenged by the Old West VS New West and Value clash. Value clash of low cost of living which has self segregated residents, workers and retirees or rich and poor. This has really been an economical development challenge. The citizens want small businesses not Wal Marts, clean industries and a proper value fit. The areas are growing middle class and upper middle tourism area down town and leaving it difficult for locals to go downtown to hang out and afford things. Some anchor stores have left in shopping centers in Cortez making it an issue for some trying to hold on small businesses. They are willing to give mass incentives to build office parks, but the infrastructure is a problem needing telecommunication systems in place first to compete for company recruitment of mid and large businesses. Transportation systems need up grade and some businesses in the area are doing that for the high-end clientele but not the lower end workers. For instance taking people to Durango and Pagosa for jobs from Cortez and other areas, it is needed for the services required of the richer folks, jobs for others and fairness among issues of real estate values of distance natural segregation in the towns which are all intertwined for commerce and growth and of course success. Noah’s Ark in Durango has two new tour buses and extended limos and a 1.2 million dollar facility for tourists, but not workers to the city, perhaps the city or county can fund them on a contract to buy another buss or two for that purpose? There is a large labor pool in Cortez many are Navajo and are extremely hard working, reliable and dependable, others are of the Ute Tribe and many are mixed with every nationality you can think of all great family people. Many of the workers do not have technical training but could learn. The entire four corners region is like that. http://www.state.co.us/oed/bus_fin/source.cfm explains the incentives for people who wish to bring businesses there to set up shop, although Durango is somewhat anti-business unless you are willing to join the club of the New West idea and sell high-end nick nacks, which not all store owners were making a lot of money, similar to Palm Desert CA and places like that. Lots of competition in the area and many of the businesses are boutiques run by people willing to wither the off years such as the recent fire year, and drought periods where the National News downgraded the area and scared travelers who took those locations off their lists. Recovering now, but no small businesses are breaking records. We did see a number of vacant shops to park trucks in the 1000 –2000 square foot range as well as many in the 5000 to 20,000 range. The growing Cortez City has about 8,200 projected by years end. Many more women than men about 2% difference. They have now also been growing wheat. They have been doing the mailings and educational activity to be good neighbors and save water for farmers and downstream cities that are more taxed with no reservoirs, more reservoirs are needed down stream. 2006 is the Centennial of Mesa Verde and it is already being planned, the parks bring in 600-7000 thousand tourists per year with 2.3 average people per car. We heard of a Juice Company which located in Delores which could ship to the Los Angeles market fo $ .50 per case and the LA competition did it for $ .30 per case bu the cost to manufacture made up for the shipping of oranges and fruit from Florida and then to LA after completed processing. Low costs made the difference and they are successfully competing and hiring more people. Another company which manufactures Tuff Boxes for security and after market auto, and a favorite at the annual Las Vegas SEMA show moved their operations from Denver to Cortez, stating costs were extremely lower, better labor and the owner and his wife could mountain bike every night and maintain twice the quality of life with none of the I-25 corridor traffic mess, permanent construction and free freeway parking at rush hour issues. Lots of dead head truckers are willing to pick up loads from trucks traveling through the area. Freight brokers said that the prices are decent and cheaper then out of Denver, Salt Lake, Flagstaff or Albuquerque. Labor in the region except for Durango and Pagosa could be hired at $7 per hour for car washing and detailing and managers at $10.00, anything more than that and you could get a first class worker and manager since cost of living where the workers live is less. Also a new Mormon Stake Center just got built out side of town with labor assistance for their people. For more information on the Economic Development Specialist Bruce Johnsons comments go to http://www.mesaverdecountry.com There is also a big noon time meeting adhoc Business Club which meets and they are also countered by the Rotary Club night time meeting group which is the older growd, we see issues of passing the torch to the next generation there and some small town politics which are getting worked out. Also working through other issues of the area are Hal Shepard of the Police Department on the drug issues. They have a good handle on it and are winning the local war on drugs. There are some wineries also on the NM side which are getting popular. http://www.winesofthesanjuan.com . Farmington has the biggest area population of the four corners region and lots of transportation companies. Right now using lots of greenhouses and drip irrigation tape to farm. Sweet corn grows well there and Canyon de Cheilly cliff dwellings and also known as one of the most beautiful canyons of the world. It is true. You should check it out and spend some money there, see America, travel and go inside a Keva this summer, nice and cool where ever you are. This concludes our preliminary report on the areas surrounding region 9 of Colorado and our ability to find the niches necessary to bring car washing and detailing to the people who desire our services and jobs to those who are willing to work and show up on time, drug free.
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