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Manhattan’s home-based businesses have dreams of a co-op

At first glance, this quiet town does not give the impression of a bustling business community.

The pharmacy closed a few years ago. A dark storefront is all that remains of the hardware store. Among the few remaining businesses are a book shop, grocery store and a couple of cafes.

By ERIN NICHOLES Chronicle Staff Writer

http://bozemandailychronicle.com/articles/2004/10/31/news/econ.txt

But looks can be deceiving.

Hidden in residential neighborhoods, behind front doors and back fences, are dozens of home-based businesses ranging from soap-making companies to automotive repair shops.

"We have a wonderful mixed bag here in Manhattan," said Jan Hobish, who make’s Aunt Jan’s chili pepper jellies and specialty mustards.

About 65 businesses — including jewelers, carpenters, engravers, furniture makers, embroiderers and stained-glass artists — are home-based here, said Karen Lauersdorf, executive assistant for the Manhattan Area Chamber of Commerce.

It’s an especially high number for a rural community with a population of just 1,400, said Dan Ryan, who runs Ryan’s Trophies, an engraving business, from his basement.

"There are a lot of craftsmen in Manhattan," he said.

Some of those people, including Ryan and Hobish, are trying to organize the town’s cottage industries into one group to help their owners get more exposure and bolster the local economy.

"There may be a lot of these home-based businesses (that) may like, eventually, to create some sort of a cooperative with a storefront where they have individual booth space on a more permanent basis," Lauersdorf said.

The ups and downs

Working from home has its perks. People can make furniture in the garage, crunch numbers in their pajamas or embroider in the kitchen without the inconveniences of time cards, cubicles and coworkers.

And "there are very big tax advantages," Ryan said. "Rather than paying … rent, we put (money) into our retirement."

Ryan and his wife used to rent a storefront in Belgrade for their business, but eventually moved it to their home.

"Economics was the reasoning," Ryan said. "Most of our business comes in over fax, phone or e-mail, so why did we need a storefront?"

Small-business owners who do not rely on regular walk-in customers can save money by moving their work to their homes.

But while at-home work may sound easier than office life, there are challenges.

A home-based business takes discipline and is demanding and time consuming, Hobish said.

"The people who own the business do every single piece of it," she said.

Aunt Jan’s has no employees except for Hobish, so she formulates recipes, buys products, cooks, meets regulations, packages, markets and sells her goods and stays on top of record keeping.

But of those tasks, marketing is one of the hardest for home-based-business owners

"Exposure is the biggest challenge," Ryan said. "We are very limited to our exposure through city rules and regulations … in residential neighborhoods."

Town ordinances restrict commercial activities in residential areas, and home-based businesses don’t have large signs and parking lots.

"You don’t have a storefront so you don’t have walk-ins," said Elaine Stromme who owns The Embroidery Place in her home. "You have to go mainly by word of mouth."

Strength in numbers

Last year, a team of business experts that helps develop rural economies visited Manhattan and recommended the town find ways to help home-based businesses overcome those challenges.

Manhattan’s first step toward achieving that goal was Made in Manhattan Day this July. Crafters set up booths and sold locally made items. The event drew about 300 people to town.

"People were looking for quality items, custom made, and that’s what everybody’s about down here," Ryan said.

The chamber is trying to find similar events to hold throughout the year, such as a "Cabin-Fever Day" in February, all the while working toward the goal of a cottage industries cooperative.

Regular gatherings could eventually result in a cooperative, Ryan said.

The cooperative could pool businesses’ resources to pay rent for a storefront, and market and sell their products.

The result would be a more consistent local customer base for the business owners, and a bolstering of Manhattan’s economy.

But organizing a cooperative sounds easier than it is, Hobish said.

As she well knows, people who run cottage industries don’t have much time for meetings. Also, home-based business owners would have to learn the cooperative business structure, which is much different than what most are used to.

Despite all of the questions, the dream is within reach, Ryan said.

"I think there’s an awful lot of potential," he said.

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