SBJ 12--2012 by The Southern Illinoisan

DECEMBER 2012

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Appearances can deceive: There are major differences between affluence and wealth which aren’t always seen. When you look across the street at the house of a well-to-do family, you are not necessarily gazing at a portrait of wealth. You are seeing a portrait of that family’s spending habits. Real wealth, the result of saving over spending, may not be advertised. Individuals appearing to live a more modest lifestyle put extra money toward their mortgage and paid it off. It’s worth noting, too, that millionaires live off just 7 percent of their wealth. Page 7

Encouraging trend: Unemployment dropped across all 18 Southern Illinois counties for the second consecutive month in September, the last full month for which statistics are available. The biggest decrease was 1.5 percent in Hamilton County, followed by 1.2 percent in Pope County, 1.1 percent in Union and Jackson counties and 1 percent in Franklin and Saline counties. Results were mixed in home and new vehicle sales, while the price of a gallon of gasoline was about 15 cents higher than a year earlier. Pages 12-13

WORKPLACE Vital skill for leaders: Effective communication skills are the most important of the so-called ‘soft skills’ needed by today’s leaders. Poor and/or ineffective communication can actually hinder and harm your business. This is important to keep in mind as you promote new leaders and let them loose to lead others. What kind of communication training do you provide them to ensure their success in your organization? Remember, strong leaders continually nurture and practice their communication skills. Page 9

ACHIEVEMENTS Who is in the news? Find out who has been hired, who has been promoted or who has received an award for efforts in business. Make sure you check out our newest ‘Faces in the News’ collection of business portraits and learn more of achievements and honors in regional businesses. If you know of a business or businessperson who deserves special recognition for advanced training, a unique honor or a business expansion, please let us know at sbj@thesouthern.com. Pages 16-19

1st Bank and Trust of Murphysboro ........8

Architechniques, Ltd .......................... 22

Bill Ecker, State Farm Insurance............ 8

Fast Truck & Trailer Service.................. 22

Illinois Small Business Development .. 10

John A. Logan College ........................ 15

Occupational Performance & Rehab .... 8

Pepsi MidAmerica .......................... 3, 20

SIU Credit Union ................................ 24

Southern Illinois Healthcare................ 17

Contact us The Southern Business Journal is a publication of The Southern Illinoisan. Contact us via mail at 710 N. Illinois Ave., Carbondale, IL 62901, or at P. O. Box 2108, Carbondale, IL 62903. Also reach us on the Web at www.sbj.biz and via email at SBJ@thesouthern.com. The Journal is published 12 times per year monthly, and mailed to businesses, community development leaders, chambers of commerce members and other professionals in Southern Illinois. Copyright 2012 by

Editor: Gary Metro 618-351-5033 Advertising: Mark Dynis 618-351-5815

618-997-3356, or by visiting our website.

Valassis Communications .................. 20

Williamson County Airport .................. 22

Online: JC Dart 618-529-5454, ext. 5183

Southern Illinois University.................... 5

Publisher: Bob Williams 618-351-5038

Database Coordinator: Mark Doman 618-351-5042

Find more business news at www.sbj.biz.

DECEMBER 2012

SOUTHERN BUSINESS JOURNAL

Cover Story Business forecast: Sunny skies for some, clouds for others BY LES Oâ&#x20AC;&#x2122;DELL SBJ CORRESPONDENT

What is in store for Southern Illinois business in 2013? Is a full economic rebound on the horizon or will the coming year be more of the same? The answer depends, in part, on the sector in question. Some business leaders are optimistic about the new year, some recognizes challenges and others are less optimistic 2013 will be better than 2012. The Southern Business Journal asked a cross-section of the areaâ&#x20AC;&#x2122;s business leaders to peer into their crystal balls and tell us what they see for 2013.

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SEE COVER / PAGE 4

Some business leaders are optimistic, some recognize challenges and others are less optimistic 2013 will be better than 2012.

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SOUTHERN BUSINESS JOURNAL

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Cover Story FROM PAGE 3

Find more business news at www.sbj.biz.

Agriculture Perhaps no industry had a worse 2012 than agriculture, which suffered through a widespread and long-lasting drought, dramatically reducing yields and, in some cases, leading producers to mow or plow under their crops rather than harvest them. While many of the crop losses were covered by insurance programs, payouts were far less than commodity revenue from a more normal year. “Producers have to determine where they go from here,” explains Brad Conant, manager of the Perry County Farm Bureau, who says the drought will have lingering effects throughout 2013. “There probably won’t be any major capital purchases this year, so I’m assuming equipment dealers and others on the input side will be concerned about that.” He says that by their very nature, people in agriculture are optimistic and understand the unique nuances of their industry. “They understand that while they have control over a lot of things, ultimately the weather is what makes a good year, an average year, or — like this year — an awful year,” he says.

and IndieGoGo.com. “I think we will see an explosion of niche crowd funding sources bringing more financial options to the table,” he says. “More financing options mean more opportunities for small businesses. As a result, I believe 2013 will be a good year for entrepreneurs and the true emergence of the crowd funding industry.”

Health care

Construction Not all industries are hopeful looking into 2013. Bruce Fager, president of FagerMcGee Commercial Construction in Murphysboro, says he expects a down year. “For commercial work, it’s looking really, really tight, like it is going to be a slow year; probably less than we were hoping for.” Fager says few projects are being bid and even though interest rates are attractive, which usually spur new construction, public construction projects are few now. “Of course, the state has problems with funding for schools and other projects, plus we haven’t heard much from architects as to what projects they have coming, either,” he says. Fager adds that the key for companies like his to be successful in the coming year will be as competitive as possible.

Energy In an area such as Southern Illinois that relies on coal for both jobs and power,

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The Southern Business Journal asked a cross-section of the area’s business leaders to peer into their crystal balls and tell us what they see for 2013

changes — or at least competition — may be coming, says Silvia Secchi, assistant professor of agribusiness economics at SIU Carbondale who specializes in environmental and energy economics. “Natural gas is still controversial in Southern Illinois and throughout the U.S. because of its impacts on groundwater pollution, but its lower air pollution potential and carbon emissions mean that it is at an advantage when it comes to existing and proposed federal regulations,” she says. “Coal will see stiff competition from natural gas because of these factors.”

Entrepreneurship On the plus side, Robyn Laur Russell, director of the Office of Economic and Regional Development at SIU Carbondale, says she expects 2013 to be a good year for both starting and growing small businesses. She says businesses that

provide services to others should especially thrive. “Service businesses are growing, as they are relatively inexpensive to launch,” she explains. “Innovation and invention are coming more into focus as well, with an increasing number of clients seeking assistance with patents or commercialization of items on which they currently hold a patent.” She adds that she also is seeing an uptick in support of small and local businesses, especially those that carry regionally made products and those in the hunting and tourism segments. Southern Business Journal contributor Cavanaugh Gray of the Entrepreneur Café LLC says the way entrepreneurs finance new ventures also is changing. He points to “crowd funding,” a means by which individual investors contribute funds to businesses or projects that interest them through websites such as Kickstarter.com

Leaders in the health care fields, however, are concerned about 2013, says Patsy Jensen, executive director of Shawnee Health Service. The problem, she says, is that medical providers are caught in a pinch between less funding and more demand for services. “We’re seeing radical changes coming as a result of the Affordable Health Care Act,” she explains. “That includes preparing for an onset of newly insured patients who were not insured before.” Added to the demand is a reduction in funding from the state. “The state’s financial situation — which impacts practically every health care provider in the region — doesn’t look like it’s getting any better and that means we have limited resources and then all of the challenges of the reform. It requires us to be more cost efficient and effective.” She says there is an upside, though. “All of us as providers and people tend to become the most creative when resources are limited. This is just another challenge for us to meet and that’s what we have to do.”

Manufacturing Area manufacturers have felt the sting of the worldwide economic downturn, causing some of them like Wildlife Materials and CareTrak International of Murphysboro to take a “wait-and-see” attitude about 2013. “It’s hard to predict where we will be a year from now,” says Richard Blanchard, who serves as president of both companies. “We’re cutting costs every way we can and making sure we’re advertising only where we think it will be SEE COVER / PAGE 23

SOUTHERN BUSINESS JOURNAL

DECEMBER 2012

Technology Distributed antenna systems give buildings cell tower power BY GARY JULIUS SBJ CONTRIBUTOR

We Americans love our cellphones. We send 200 trillion text messages each and every day. In addition, we talk on a mobile phone an average of 21 minutes per day. Julius And, according to a recent study by the Pew Research Center, we find cellphones to be good entertainment, with 42 percent of all respondents saying they use their phone to occupy themselves during otherwise boring hours. Yet, ever since wireless phones came into use, large buildings with steel frames, concrete masses and layers of energy-saving sheathing have proved a bane. They interfere with or repel cellphone signals. How many times have you dropped a cellphone call upon driving into an underground parking garage or stepping into the elevator of a high-rise office building? Compounding the problem: As much as Americans love their cellphones, they don’t like the cell towers that make it possible to use them. At last count (2011), there were an estimated 256,000 of them in the U.S. Stories of neighborhoods banding together to block cell tower construction are increasingly commonplace. About 10 years ago, a solution emerged to the annoying “no bars deep in the bowels of the building” problem. It was to build a cell tower inside the building using a distributed antenna system. In its simplest form, the technology utilizes a “repeater” device mounted outside the structure (generally on the roof) to collect the radio signals of private carriers or public safety organizations and retransmit them at a heightened power to a network of antennas snaked throughout its interior. DAS installations are on the rise in Southern Illinois, reflecting a global trend quantified in a recent study by ABI

THE SOUTHERN FILE PHOTO

Construction work is shown at Good Samaritan Regional Health Center in Mount Vernon.

Research which put total investment in DAS and related devices at nearly $10 billion this year. Virtually every new mid-rise (four-story and higher) building being built or planned for construction in Illinois includes DAS. A case in point is the new five-story, $237 million, 134-bed Good Samaritan Hospital and Surgery Center now taking shape in Mount Vernon. Further north, our company is installing a DAS at the new 25-bed, 128,000-square-foot St. Joseph’s Hospital and Medical Office Center. Factors fueling the upsurge in DAS demand — other than assured fourbar signal strength for major wireless carriers in large structures — include public safety and the hunger of hospitals for processing speed and bandwidth. On the public safety front, emergency personnel rely on land mobile radio systems to respond to 911 calls. If the

radio signals can’t get through to responders, lives could be lost. Further, a 2010 federal mandate bans firefighters from using plug-in analog in-building phone systems when responding to emergencies in structures larger than 20,000 square feet or higher than three stories. These buildings are now required to have a DAS dedicated to emergency use. As for the medical field, hospitals are clamoring for more wideband channels and accelerated data uploads so that their information technology systems can accommodate and integrate multiple electronic applications as they seek to meet the 2014 federal deadline for making “meaningful use” of electronic medical records for patients. Hospitals that don’t make the deadline will suffer financial penalties. Accordingly, New In-Stat Research projects explosive growth in hospital DAS installations — from the nearly

$2 billion U.S. hospitals are investing this year to more than $4 billion in 2015. As electronic communication systems continue to proliferate, DAS are becoming an essential infrastructure component of every major building — as important as its plumbing, electrical or HVAC system — though sight unseen to building users. For us cellphone-loving Americans, there’s an added benefit to the growing popularity of DAS. If there’s anything more aggravating than dropping a call, it’s seeing your cell battery monitor flashing red. When cellphones have four-bar coverage, they don’t need to expend the substantial battery power it takes to search for a signal. Extended battery life is just another positive outcome made possible by DAS. GARY JULIUS is a director of Guarantee Electrical Co., which has offices in St. Louis and Granite City.

DECEMBER 2012

SOUTHERN BUSINESS JOURNAL

Investments Big spenders vs. big savers Who would you rather emulate? BY SCOTT MCCLATCHEY SBJ CONTRIBUTOR

You stand at your window and look across the street. Nice house, you think. Nice landscaping. Nice sports car. Nice driveway. New bikes for the kids. Wow, your McClatchey neighbors are really well off. If only you had that kind of money. That plain home down the street with the older model sedan parked out front pales in comparison. A couple in their 70s lives there, and the front yard hasn’t been spruced up in a decade. Who knows, maybe they struggle just to get by. If you could somehow look into the financial lives of those two households, you might be surprised. The couple with all the toys might not be as wealthy as the neighborhood perceives, while the vanilla exterior on that humble rancher might hide a multimillionaire next door. Remember that affluence does not equate to net worth. When you look across the street at the house of that well-to-do family, you are not necessarily gazing at a portrait of wealth. You are seeing a portrait of their spending habits. What are they spending their money on? Perhaps, quite literally, a façade; their house may be the best house in the neighborhood, but what of kind of mortgage payment are they grappling with? Are they making payments on that sports car? That vehicle is a depreciating asset (unless they keep it garaged for a few decades). The flat-screen, the pool, the home audio system ... they have put their dollars into things that their neighbors can see. They may be engaging in all-too-common financial behavior:

thinking of wealth in terms of material items, spending money on toys instead of their lives. Real wealth may not be advertised. Perhaps the older couple down the street isn’t interested in the hottest new luxuries. Decades ago, they put extra money toward their mortgage; even with housing values currently depressed, their residence is still worth much more than they paid for it. Most importantly, it is paid off. Maybe they are good savers, always have been. When they were the age of the flashy couple up the street, they directed money into things their neighbors couldn’t see — their investments, their retirement accounts, their bank accounts. Years ago, they could have lived ostentatiously like that high-earning couple up the street — but instead of living on margin, they chose to live within their means. They saw some of their friends “rent” a luxury lifestyle for a few years, only to lose homes and cars they couldn’t really afford. Sometimes the economy or fate had a hand in it, but too often their friends simply made poor decisions. It could be that it was just more important for them to think about the future rather than the moment. Parenting reinforced that philosophy. Their good financial habits kept their family away from a bunch of bad debts and helped them build wealth slowly. Indirectly, it also helped their kids, who grew up in a household with less financial stress and with an appreciation and understanding of key financial principles. Now, they are applying those principles to build wealth in their own lives. Roughly every fortieth American is a millionaire. There are nearly 8 million people with a net worth of $1 million or more in the U.S., and their financial characteristics may differ slightly from what you expect. Fidelity’s 2012 Millionaire Outlook survey (which polled 1,000 households

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Real wealth may not be advertised. Perhaps the older couple down the street directed money into things their neighbors couldn’t see — their investments, their retirement accounts and their bank accounts.

with $1 million or more in investable assets) notes that 86 percent of millionaires are self-made. Not so amazing, perhaps, but here is a striking detail. Among the self-made millionaires, the top sources of assets were (1) investments and/or capital appreciation, (2) compensation and (3) employee stock options or profit sharing. Millionaires born into wealth were the most likely to cite entrepreneurship and real estate investing as key factors behind their fortunes. According to the survey, the average U.S. millionaire is 61 years old with $3.05 million in investable assets. Fidelity also found that with regard to the financial future, more than (30 percent) of these millionaires were focused on preserving wealth, rather than growing it (20 percent). What will you spend your money on, tomorrow or today? As Thomas J. Stanley and William D. Danko noted in their classic study The Millionaire Next Door, the typical

Find more business news at www.sbj.biz. millionaire lives on 7 percent of his or her wealth. That was in 1997; the percentage could be lower today. Call it frugal, call it boring, but such financial conservation may help promote lifetime wealth. Today, with so many enticements to spend your money as soon as you earn it, this mindset may have a lot of financial merit. SCOTT MCCLATCHEY is a Certified Financial Planner™ with Alliance Investment Planning Group, a Carbondale investment firm located at 115 S. Washington St. He can be reached at 618-519-9344 or scott@alliance investmentplanning.com. He also provides investment, retirement planning, and insurance services to SIU Credit Union members through the SIU Credit Union Investment Services partnership. Securities offered through LPL Financial, Member FINRA/SIPC.

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DECEMBER 2012

SOUTHERN BUSINESS JOURNAL

Workplace What kind of communication example are you setting? BY ANGELA HOLMES-YOUNG SBJ CONTRIBUTOR

As a leader, you have certain responsibilities. On the list of soft skills needed in a leadership role, I would argue communication skills should be at the top, as I feel it is Holmes-Young clearly the most important. Actually, let me restate that by saying effective communication skills are the most important of the soft skills needed today. As we all know, poor and/or ineffective communication can actually hinder and harm your business. This is important to keep in mind as you promote new leaders and let them loose to lead others. What kind of communication training do you provide them to ensure their success in your organization? Soft skills need to be nurtured and practiced. A few weeks ago, I was the keynote speaker for a large group of adult educators as part of their annual conference. Did you know that among their many challenges, they are constantly focusing on preparing adults to be better and more skilled workers for your organization? As part of the keynote speech and another session, I spent a large amount of time talking about the importance of communication skills beyond just the basics. I will ask you the same questions that I asked that group — do you as a leader model positive, effective communication in your organization? Do you reinforce strong communication tactics when communicating with others which sets the tone for the entire operation? What are you doing to emphasize the importance of communication in your organization? Do you utilize communication planning and strategy? Do you personally utilize successful communication that can be modeled by others? Take a minute to think about it. I guess what I am asking of you today is whether you actually practice what

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Effective communication skills are the most important of the soft skills needed today.

you preach. Those of you that are rightbrained and consider yourselves to be “people” focused may love the soft skills. Things like communication and presentation skills may come easy for you. Maybe you enjoy teamwork and networking and all of these things that those left-brained people enjoy less. No matter what your preference, as a leader, it is your responsibility to set the example for the organization. You are creating the culture. People are watching. The leader has to lead in all facets and at all times. Communication is really that one item that pulls everything together in your organization. The leader needs to be a stellar communicator. Employers also cannot forget that other leaders within the organization need communication help as well. We need to ensure that supervisors and front-line leaders in your organization are fully ready to communicate successfully when prompted or appointed to their new leadership position. It is exactly this probable lack of communication skills that causes employee relations issues and ends up being a liability for the employer. How do you prepare your new leaders? How do you know that they are ready? What tools are they given to do their job? Let me give you and your new leaders some easy positive communication tips from Sheila Dick’s, an image consultant.

These tips are so easy, you should be able to start using a few right now.

Positive Communication Tactics Listen. If you feel you are distracted or cannot listen, tell the person you are communicating with. You may need to re-schedule your meeting or discussion because you will be wasting your time as well as their time. Use names. When you are speaking with someone, using their name keeps them more engaged and involved in what you are saying. Get to the point. No one likes to talk to that person that goes on and on but never seems to get to the point. People quit listening. Make sure you get to the point quickly without being rude. Let others talk. No one enjoys listening but never ever getting to speak. Conversations and any kind of communication should be a two-way interaction. Ensure the other person is engaged and able to give feedback. Non-verbal language. Non-verbal language is just as important as the verbal pieces of the communication and could be a column all on its own. Make sure you are not hindering communication by appearing that you are not receptive to what the other person is saying. Take a minute to see yourself as others see you. Are your arms crossed? Do you have an angry look?

What message is your body sending? Vocal cues. Vocal cues such as a person repeatedly clearing their throat or saying Uh Um, along with other sounds are distracting and will turn your listener off. If you have trouble with vocal issues, take some time to practice before important communications to try to eliminate these unwanted vocal cues. Create an open atmosphere. If you invited someone to come to speak with you in your office but your desk is piled with papers and books, how will you be able to speak with this person? Take the time to clear away some of the mess to make the person feel welcome. This also removes physical barriers from the communication. In the end, like with anything, those who are successful have practiced. I suggest the use of communication planning when possible. For important meetings or discussions, take the time to plan out how you hope the communication will go. You can mentally walk yourself through each of these seven steps before the meeting to prepare. For example, you can make sure you know the name of the person you are meeting with so you can use their name during the conversation. You can remove any physical barriers to create an open atmosphere in advance of the conversation. A little planning goes a long way. As we prepare for the New Year, I challenge you to think about this. Engaging in true communication planning can improve your leaders and reduce employee relations issues. This in turn affects productivity, morale, turnover and long-term legal costs. Everyone works better when they are “in the know” thanks to effective communication. ANGELA HOLMES-YOUNG is Vice President of Consulting & Human Resource Services for Your Professional Partners, Inc. in Marion, Illinois. She consults with clients of all sizes in a variety of human resource areas while also offering executive coaching and public speaking. You can reach Angela by email at angela@yourprofessional partners.com or call 618-969-8800. Twitter: A_Holmes_Young

SOUTHERN BUSINESS JOURNAL

DECEMBER 2012

Elder Law Congress is going after granny ... again! BY RICHARD HABIGER SBJ CONTRIBUTOR

Anyone who thought the re-election of President Barack Obama would usher in an era of civil discourse among politicians has deluded themselves. It is now apparent Habiger that the long-ago era when politicians in the two major parties were able to compromise for the good of the country, to find common ground for the greater good, is now long gone ... perhaps never to be found again. It seems the two parties are like two street gangs; the members of one gang wear red “doo-rags” while the other display blue. Both gangs engage in random drive-by sniping, going after anyone who is thought to present a threat to their red or blue “turf.” Unfortunately, as on the mean streets of Chicago and St. Louis, innocent persons get hurt in the crossfire. Sadly, the victims include grandmothers sitting on their porches. What does gang-warfare have to do with congress and long-term care planning? Actually, there is no connection. Figuratively, by analogy, the congressional “warfare” has a great deal to do with planning for the future. Several members of one Congressional “gang” have introduced a bill that, if enacted into law, would gravely wound “granny.” Indeed, the bill would savage grandfathers, as well as grandmothers, and their loving families. House Bill 6300 (with the innocentsounding name “Medicaid Long-Term Care Reform Act of 2012”) requires the state and federal governments to “reduce the number of middleincome individuals who rely on Medicaid to finance their long-term

care needs by:” “Increasing the enrollment” (that is, forcing persons to purchase) long-term care insurance policies.” Among other odious provisions, the bill also would require the study and evaluation (and, next year, enact legislation) to: Bring about a “reduction in home equity exemption to either $200,000 or $50,000” (from the current $500,000 ... thereby forcing farmers to sell their homestead farms); Impose a “10 year look-back period” (from the current 5 year look-back period ... which was increased from 3 years a mere eleven months ago); and “[Encourage] (i.e., force) states to use liens for the purpose of estate recovery” (that is, to become even more aggressive in balancing state budgets on the backs of hard-working Middle Americans). So, now that you know that the “gang warfare” is just down the street and is headed toward your house, what are you to do? You may have already put a good long-term care plan into place, one that would protect you and your loved ones. But, of course, that plan was based on the current law. If House Bill 6300 moves forward toward passage, every citizen needs to be concerned for their own well-being and that of their loved ones. If the congressional “turf battles” break out into open “warfare,” seniors and the disabled will need to seek shelter. More importantly, seniors and the disabled will need to find their voices and take back their neighborhood. RICHARD HABIGER is the author of the Illinois edition of How to Protect Your Family’s Assets from Devastating Nursing Home Costs: Medicaid Secrets and is an elder law attorney, who focuses on asset protection, Medicaid and VA benefits. You may contact him at 618-549-4529 or info@habigerelderlaw.com.

DECEMBER 2012

SOUTHERN BUSINESS JOURNAL

Entrepreneur’s Mailbag When getting even isn’t a bad thing BY CAVANAUGH L. GRAY SBJ CONTRIBUTOR

Flipping channels a few weeks ago, I landed on a dad that was desperately trying to teach his children the lesson of earning an honest dollar. To bring his point across as Gray easily as possible, he chose to help them build their very own lemonade stand. In theory, you could tell that from the youngest to the oldest they got the idea — I sell lemonade and people give me money. The humorous part was watching as the dad tried to explain the inner workings of their lemonade empire. How do you get the money to start, what ingredients are needed (and at what cost), and how do you determine if your operation is successful or not? The children understood one thing and one thing only, “I sell lemonade and people give me money.” Let’s be honest, small business financials are far less sexy than its marketing counterpart. This made me wonder if over the years I had developed a “let someone else worry about the details ... how much money do I stand to make attitude.” So I set out on a little experiment of my own. If I had to teach small business financials to my own kids or simply put a concept like break-even analysis into layman’s terms, could I do it successfully?

easier. To figure out your company’s break-even, try keeping the following formula in mind: Break-even equals your total fixed cost divided by your contribution margin or break-even total fixed cost/contribution margin. The following sections will provide the steps needed to help us figure out our break-even point.

Step 2: Determine your fixed cost To reach our break-even point, the first thing we need to do is figure out our total fixed cost. Fixed costs are business expenses that are not dependent on the amount of goods and services produced — also known as overhead. Simply put, if your company fails to make one dime, fixed costs are the expenses that will need to be paid regardless. For our example we will focus on determining a monthly break-even point. Also, we will bypass our traditional drive-way lemonade stand model because we have bigger aspirations. We are going to be opening a small but premium lemonade kiosk at the local mall. Although our model is less capital intensive than opening a full lemonade bar, our kiosk will carry more cost than setting up shop on our front lawn. The following outlines the basic expenses for our lemonade kiosk. Our kiosk rental, utilities, salary, marketing and insurance expenses bring our total monthly fixed costs to $3,820. In moving our formula along the next thing that we will need to figure out are our variable costs.

133 servings at a cost of 7.5 cents per serving. Water cost for every cup of lemonade is 3.4 cents, branded cups will costs us 5 cents and miscellaneous supply costs per serving are equal to 2 cents. This brings our total variable costs per serving of lemonade to 17.9 cents. This might be a bit more costly than a glass of Country Time but then again we are serving premium lemonade. At 133 servings per batch of mix, this would bring our total variable costs to $23.80 (133 servings x 17.9 cents per serving). Finally, we have established that our per unit sales cost, or the price that we will sell each cup of lemonade for will be $3.50 a cup.

Step 4: Understanding revenue and contribution margins Next we will need to determine our contribution margin which brings us one step closer to reaching our break-even point. A contribution margin is the amount from each sale that goes toward covering the company’s fixed costs or overhead expenses. In the last step we established our per unit sales cost at $3.50 a cup. We also determined that because we are selling premium lemonade that our variable cost will be a bit higher than most and come out to $0.179 per serving. Using our formula we determine that our contribution margin is $3.321. Contribution margin per unit sales cost – variable cost – $3.321 $3.50 $0.179

Step 1: Understanding break-even

Step 3: Taking into account variable cost

Step 5: Determining your break-even point

There are many tools that a smallbusiness owner can use to gauge the financial health of their organizations. In my case, I have chosen to do an examination of the break-even analysis. A break-even analysis is a financial examination tool that lets you know what you need to sell on a monthly or annual basis in order to cover the cost of doing business. I’ve always been a big fan of math but an even bigger fan of formulas that tend to make calculations

Now that we have figured out what our overhead is going to be, it’s time to determine what the cost is to deliver our particular product or service better known as variable costs. Variable costs are costs that vary and can either increase or decrease depending on production or sales volume. In the case of our lemonade kiosk we are selling premium lemonade based on an old family recipe. One large batch will cost us $10 to make and will make

Looking back over the steps in our lemonade kiosk example, we were able to determine our fixed cost, variable cost, per unit sales costs and our contribution margin. From this point finding our break-even point should be pretty straightforward. Using the formula below that we introduced in Step 1, we determine that we will need to sell 1,150 servings of lemonade per month in order to break-even. Any sales beyond that point should be considered

There are many tools that a small-business owner can use to gauge the financial health of their organizations. In my little experiment, I have chosen to do an examination of the break-even analysis. A break-even analysis is a financial examination tool that lets you know what you need to sell on a monthly or annual basis in order to cover the cost of doing business. as a starting point for greater profitability. Break-even total fixed cost/contribution margin – 1,150 Servings of Premium Lemonade $3,820 / $3.321 Break-even analysis is by no means a definitive financial measure for a small business, however, it does provide some interesting insight. For starters breakeven analysis is relatively simple and depending on the complexity of your business can be completed in a short period of time. Break-even analysis provides you with a solid financial metric that you can you use to leverage against your desired sales goals. Finally, I learned that if anyone thinks they are going to hold the attention of two lads while they lecture on something as exciting as numbers, then they are surely kidding themselves. CAVANAUGH L. GRAY (cgray@ecafellc.com) is the Director of Business Development for The Entrepreneur Café, L.L.C 877-5114820. To read a chapter from his new book The Entrepreneurial Spirit Lives: 25 Tales to Help Entrepreneurs Start, Grow, and Succeed in Small Business log on to www.ecafellc.com. For more information on how to start, grow and succeed in small business, ‘Like’ on Facebook, ‘Follow’ on Twitter @TheECafe or ‘Connect’ on LinkedIn.

Retail sales for Southern Illinois cities City Anna Benton Carbondale Carterville Chester Du Quoin Harrisburg Herrin Jonesboro Marion Metropolis Mount Vernon Murphysboro Nashville Pinckneyville Red Bud Sparta Vienna West City West Frankfort REGION ILLINOIS

YTD Sept 2012

2011

2010

2009

2008

2007

84.9 62.3 407.8 28.8 39.3 86.6 152.0 110.9 8.8 443.6 57.4 368.7 94.0 86.8 28.4 54.4 89.4 28.2 64.2 40.6 $2,337.1 $112,430.2

119.1 86.4 593.5 42.0 55.7 113.5 214.0 154.0 11.4 686.9 84.4 533.6 135.2 110.3 42.3 74.7 128.2 40.1 88.3 122.5 $3,436.1 $154,650.6

120.9 69.5 598.0 42.2 55.3 77.1 195.0 153.4 11.8 683.1 82.0 507.0 130.6 96.6 38.5 75.2 128.5 39.9 87.8 112.4 $3,304.8 $147,232.0

114.5 69.4 565.5 39.9 52.9 100.8 191.9 147.2 12.5 676.0 77.1 476.7 129.1 107.9 37.2 70.1 126.4 37.1 91.9 111.4 $3,235.5 $139,593.2

113.3 71.4 587.7 40.1 51.5 91.9 179.3 135.9 12.4 673.4 75.9 482.8 117.1 101.8 39.0 77.7 130.5 40.5 89.6 111.2 $3,223.0 $237,438.0

112.3 72.4 607.4 40.3 51.7 94.4 173.6 134.4 11.3 662.4 79.8 461.5 94.9 105.2 35.8 73.7 129.5 39.8 82.8 111.4 $3,174.7 $180,162.7

N I L L I Chicago Fed Midwest % change 07-11 Manufacturing Index

6.1% 19.3% 2.3% 4.2% 7.7% 20.2% 23.3% 15.6% 0.9% 3.7% 5.8% 15.6% 42.5% 4.8% 18.2% 1.4% 1.0% 0.8% 6.6% 10.0% 8.2% 14.2%

Alexander Franklin Gallatin Hamilton Hardin Jackson Jefferson Johnson Massac Perry Pope Pulaski Randolph Saline Union Washington White Williamson .,REGION ILLINOIS U.S.

2,888 17,505 2,640 4,174 1,779 32,722 19,931 5,144 7,585 9,610 1,897 2,616 15,226 12,671 7,736 8,554 7,789 34,720 195,187 6,623,236 155,075,000

308 1,978 218 298 199 2,393 1,681 515 652 1,034 184 290 1,243 1,114 793 612 578 2,867 16,957 536,288 11,742,000

104 103 102

IPMFG Sept 12 95.3

100 98 94 90 88 86 84

81 80

Unemployment rates for Southern Illinois counties, state and nation Jobless

105

SOURCE: LATEST STATISTICS AVAILABLE FROM THE ILLINOIS DEPARTMENT OF REVENUE. FIGURES ARE IN MILLIONS.

Labor force

The CFMMI is a monthly estimate by major industry of manufacturing output in the Seventh Federal Reserve District states of Illinois, Indiana, Iowa, Michigan and Wisconsin. It is a composite index of 15 manufacturing industries, including auto and steel, that uses electrical power and hours worked data to measure monthly changes in regional activity. It is compared here to the national Industrial Production index for Manufacturing (IPMFG). Base year is 2007. Starting in November 2005, the index excluded the electricity component.

Sept 2012

Aug 2012

Sept 2011

10.7% 11.3% 8.3% 7.1% 11.2% 7.3% 8.4% 10.0% 8.6% 10.8% 9.7% 11.1% 8.2% 8.8% 10.3% 7.2% 7.4% 8.3% 8.7% 8.1% 7.8%

11.6% 12.3% 8.8% 8.6% 11.3% 8.4% 9.1% 10.8% 9.1% 11.6% 10.9% 11.4% 9.0% 9.5% 11.3% 7.7% 8.5% 9.1% 9.9% 8.9% 8.1%

12.6% 12.0% 9.2% 8.0% 11.0% 7.8% 8.9% 10.1% 9.0% 10.5% 10.8% 10.9% 8.4% 9.7% 11.4% 7.4% 8.2% 9.0% 9.7% 9.8% 9.0%

SOURCE: ILLINOIS DEPARTMENT OF EMPLOYMENT SECURITY, U.S. DEPARTMENT OF LABOR. FIGURES ARE NOT SEASONALLY ADJUSTED.

Change month

0.9 1.0 0.5 1.5 0.1 1.1 0.7 0.8 0.5 0.8 1.2 0.3 0.8 0.7 1.0 0.5 1.1 0.8 1.2 0.8 0.3

Change year

76 74

CFMMI Sept 12

1.9 72 93.4 0.7 70 68 0.9 0.9 66 0.2 64 F M A M J J A S O N D J F M A M J J A S ’11 ’12 0.5 0.5 SOURCE: FEDERAL RESERVE BANK OF CHICAGO 0.1 0.4 0.3 1.1 0.2 Sept 12 Sept 11 Change 0.2 0.9 MONTHLY TOTALS 1.1 854 881 3.0% 0.2 YTD TOTALS 0.8 0.7 7,481 7,009 6.7% 1.0 2011 2010 Change 1.7 ANNUAL TOTALS 1.2 9,682 7,478 29.5%

Williamson County Regional Airport passengers

I S I N Consumer credit score

686

Credit scores are numeric reflections of financial behavior and credit worthiness and they are based on information included in a credit report. Ranging from 330 to 830, a higher score means a lower credit risk. Scores are from November 2012.

693

Jonesboro

Region

694

688

SOURCE: EXPERIAN

State

O R S U of I Flash Index

U. S.

Total cars, trucks sold based on title applications filed. Excludes motorcycles, trailers.

New vehicle sales Alexander Franklin Gallatin Hamilton Hardin Jackson Jefferson Johnson Massac Perry Pope Pulaski Randolph Saline Union Washington White Williamson REGION

Sept 12

Sept 11

Change

2011

13 76 12 18 6 123 67 31 17 45 6 13 69 75 39 27 43 194 874

17 95 22 18 12 127 90 37 32 49 8 9 78 86 45 53 53 169 1,000

23.5% 20.0% 45.5% 0.0% 50.0% 3.1% 25.6% 16.2% 46.9% 8.2% 25.0% 44.4% 11.5% 12.8% 13.3% 49.1% 18.9% 14.8% 12.6%

142 1,174 265 279 96 1,482 1,025 392 297 606 96 159 975 1,022 502 583 625 2,060 11,780

2010 126 965 222 236 97 1,320 848 327 269 558 73 129 844 793 486 446 571 1,796 10,097

Change

12.7% 21.7% 19.4% 20.8% 1.0% 12.3% 20.9% 19.9% 10.4% 8.6% 31.5% 23.2% 15.5% 28.9% 3.3% 30.7% 9.5% 14.7% 16.7%

5 86 4 5 2 110 69 16 34 21 2 1 38 47 23 182 36,385

’12

’11

’10

SOURCE: INSTITUTE OF GOVERNMENT AND PUBLIC AFFAIRS, UNIVERSITY OF ILLINOIS

Hotel/motel stats

Consumer Price Index

Total amount of revenue generated in Carbondale by hotels and motels for room rentals only.

The CPI measures average price changes of goods and services over time, with a reference base of 100 in 1982-84.To put into context, a current CPI of 194.5 means a market basket of goods and services that cost $100 in 1982-84 now costs $194.50.

Aug 12 Aug 11 MONTHLY TOTALS

Change

$775,485

$755,170

2.6%

YTD TOTALS $5,308,365

232

230

$5,373,975

2011 ANNUAL TOTALS

2010

0.7%

Change

228

226

U.S. City Average Oct 12 231.3

224

222

$7,710,436 <0.01%

220

218

Total units sold, including condominiums

Q3 12 Alexander Franklin Gallatin Hamilton Hardin Jackson Jefferson Johnson Massac Perry Pope Pulaski Randolph Saline Union Williamson ILLINOIS

Oct 12 104.0

$7,706,931

SOURCE: ILLINOIS SECRETARY OF STATE’S OFFICE. LATEST DATA AVAILABLE.

Home sales

108 107 106 105 104 103 102 101 100 99 98 97 96 95 94 93 92 91 90 89

The Flash Index is an early indicator of the Illinois economy’s expected performance. It is a weighted average of growth rates in corporate earnings, consumer spending and personal income. An index above 100 indicates expected growth; an index below 100 indicates the economy is contracting.

Q3 11 4 71 5 0 6 108 88 20 25 21 5 2 28 40 31 174 29,787

SOURCE: ILLINOIS ASSOCIATION OF REALTORS

Change 25.0% 21.1% 20.0% NA 66.7% 1.9% 21.6% 20.0% 36.0% 0.0% 60.0% 50.0% 9.7% 17.5% 25.8% 4.6% 20.5%

2011 16 283 12 6 14 325 258 66 82 86 10 11 117 148 89 539 103,294

2010 19 259 8 8 8 358 264 78 91 116 8 6 131 122 84 590 103,455

Change

15.8% 9.3% 50.0% 25.0% 75.0% 10.2% 2.3% 15.4% 9.9% 25.9% 20.0% 83.3% 10.7% 21.3 % 6.0% 8.6% 0.2%

MEDIAN SALES PRICE Q3 12 Q3 11 $33,000 $64,950 $74,000 $79,500 $70,500 $91,450 $89,000 $79,500 $69,500 $55,000 $28,500 $53,500 $85,000 $55,000 $106,000 $101,750 $145,000

$41,750 $38,500 $57,000 $0 $80,000 $102,750 $91,000 $99,750 $70,000 $82,500 $75,000 $66,250 $92,000 $64,450 $99,000 $115,000 $145,000

216

Change

214

21.0% Midwest Urban 68.7% Oct 12 220.4 29.8% NA 11.9% 11.0% SOURCE: U.S. DEPARTMENT OF LABOR 2.2% 20.3% 0.7% 33.3% Average price per gallon of regular, unleaded 62.0% gas as of November 21 and October 26, 2012. 19.2% Nov 12 Oct 12 Nov 11 7.6% $3.38 $3.37 $3.24 14.7% Metro East 7.1% Springfield $3.50 $3.33 $3.31 11.5% Illinois $3.54 $3.55 $3.46 $3.43 $3.58 $3.35 0.0% U.S. 212

210

208

N ’11

M ‘12

Prices at the pump

SOURCE: AAA

SOUTHERN BUSINESS JOURNAL

DECEMBER 2012

Money Matters Sudden wealth: How would you manage an unexpected infusion of money? BY MICHAEL P. TISON

Find more business news at www.sbj.biz.

SBJ CONTRIBUTOR

What would you do with an extra $10,000? Maybe you’d pay off some debt, get rid of some college loans, or take a muchneeded vacation. What if you suddenly had an Tison extra million or 10 million or more? Whether you picked the right six numbers in your state’s lottery or your dear Aunt Sally left you her condo in Boca Raton, you have some issues to deal with. You’ll need to evaluate your new financial position and consider how your sudden wealth will affect your financial goals.

Impact on investing What will you do with your new assets? Consider these questions: Do you have enough money to pay your bills and your taxes? How might investing increase or decrease your taxes? Do you have assets that you could quickly sell if you needed cash in an emergency? Are your investments growing quickly enough to keep up with or beat inflation? Will you have enough money to meet your retirement needs and other long-term goals? How much risk can you tolerate when investing? How diversified are your investments? The answers to these questions may help you formulate a new investment plan. Remember, though, there’s no rush. You should meet with an investment advisor for help with these decisions. It might be appropriate to wait 6 months before any new investment strategies are implemented.

your death. If your estate will be worth more than the applicable exclusion amount (formerly known as the unified credit), consider looking at ways to minimize estate taxes. Unfortunately, in 2013 the exclusion moves back to the $1 million level until our Congress renegotiates the new exclusion level.

ART SERVICES

Whether you picked the right six numbers in your state’s lottery or your dear Aunt Sally left you her condo in Boca Raton, you have some issues to deal with.

This will let you sift through the salesmen and financial advisors so you can determine who both has your best interest in mind and who has the most knowledge to help you reach your financial goalsnot theirs. Once you’ve taken care of these basics, set aside some money to treat yourself to something you wouldn’t have bought before — it’s OK to splurge wisely with some of your new money!

Impact on insurance It’s sad to say, but being wealthy may make you more vulnerable to lawsuits. Although you may be able to pay for any damage (to yourself or others) that you cause, you may want to re-evaluate your current insurance policies and consider purchasing an umbrella liability policy. If you plan on buying expensive items such as jewelry or artwork, you may need more property/casualty insurance to cover these items in case of loss or theft. Finally, it may be the right time to re-examine your life insurance needs. More life insurance may be necessary to cover your estate tax bill so your beneficiaries receive more of your estate after taxes.

Impact on estate planning Now that your wealth has increased, it’s time to re-evaluate your estate plan. Estate planning involves conserving your money and putting it to work so that it best fulfills your goals. It also means minimizing your taxes and creating financial security for your family. Is your will up to date? A will is the document that determines how your worldly possessions will be distributed after your death. You’ll want to make sure that your current will accurately reflects your wishes. If your newfound wealth is significant, you should meet with your attorney as soon as possible. Carefully consider whether the beneficiaries of your estate are capable of managing the inheritance on their own. For instance, if you have minor children, you should consider setting up a trust to protect their interests and control the age at which they receive their funds. It’s probably also a good idea to consult a tax attorney or financial planner to look into the amount of federal estate tax and state death taxes that your estate may have to pay upon

Giving it all away — or maybe just some of it Is gift giving part of your overall plan? You may want to give gifts of cash or property to your loved ones or to your favorite charities. It’s a good idea to wait until you’ve come up with a financial plan before giving or lending money to anyone, even family members. If you decide to give or lend any money, put everything in writing. This will protect your rights and avoid hurt feelings down the road. In particular, keep in mind that: You can make individual gifts of up to $13,000 each calendar year without incurring any gift tax liability ($26,000 if you are married, and you and your spouse can split the gift) If you pay the school directly, you can give an unlimited amount to pay for someone’s education without having to pay gift tax (you can do the same with medical bills) If you make a gift to charity during your lifetime, you may be able to deduct the amount of the gift on your income tax return, within certain limits, based on your adjusted gross income. MICHAEL P. TISON is an Investment Advisor and Registered Principal with Raymond James Financial Services, Inc., with offices in Harrisburg and Marion. He can be reached at 618-253-4444 or michael.tison@raymondjames.com.

SOUTHERN BUSINESS JOURNAL

DECEMBER 2012

Achievements

Faces in the news

Haggard named president of Du Quoin chamber

Haggard

Gullett

Zimmerman

Lorenz

Sheila Haggard has been named president of Du Quoin Chamber of Commerce for fiscal years 2013 and 2014. Outgoing President Fred Huff handed Haggard the presidency at a chamber meeting Oct. 3 in Du Quoin Elks Lodge. She and her husband, Donnie Haggard, have two adult children, Aaron Haggard and Afton Haggard Reynolds, whose families live in Du Quoin. She is owner of the family business, Haggard Custom Siding Inc., in Du Quoin and has been employed at Shawnee Health Services since 1995.

Rent One hosts re-opening celebration Rent One hosted a grand re-opening celebration and ribbon-cutting ceremony recently at its new facility at 2402 Williamson County Parkway, Suite B, in Marion.

Curry

McQueen

RNR Wheels & Tires hosts open house RNR Wheels & Tires hosted an open house and ribbon-cutting ceremony recently at its new facility at 2402 Williamson County Parkway, Suite A, in Marion.

Cripps

Frey

FB McAfoos & Co. hosts dignitaries FB McAfoos & Company in Benton recently hosted a visit by dignitaries from Kubota Tractor Corporation. Yuichi “Ken” Kitao, president and CEO of KTC, presented FB McAfoos & Company with the President’s Kaizen Award for its commitment to continuous improvement.

Rice

Rushing Find more business news at www.sbj.biz.

Romine

Legal professionals attend conference Three legal professionals from Jackson County attended a conference Oct. 17 to 20 in Seattle. The conference was sponsored by the National Organization for Social Security Claimants’ Representatives. Attorney Joni Beth Bailey of Murphysboro and two paralegals, Allison Speith of Murphysboro and Cory Fry of Ava, attended several

workshops, including those designed to help representatives assist disabled veterans.

Kaye earns wound care certification Dr. Michael Kaye recently obtained certification in wound care from the American Board of Wound Healing. Kaye is employed by Union County Podiatry Clinic in Anna and provides specialized wound care through Union County Hospital Wound Care Services.

Zimmerman named to hospital board Dr. Richard Zimmerman has been named to Marshall Browning Hospital Board of Directors. Zimmerman replaces retiring director, Harold Rice, who served 38 years on the hospital board. Zimmerman, a chiropractor, is a lifelong resident of Southern Illinois and has practiced in the area since 1993. He owns Doc Z’s Fitness in Du Quoin.

RSP conducting ‘Freeze out Hunger’ campaign As part of RSP Heating & Cooling’s “Freeze out Hunger” campaign, employees are collecting canned goods and other non-perishable food items throughout the winter months. All items collected will be distributed among local pantries and shelters. Anyone donating six or more food items will receive a free 1-inch furnace filter. Donations may be collected during service calls, or they may be dropped off at the RSP office, 6951 E. Grand Road, in Carterville. For more information, call RSP at 618-942-2424.

Mercer hired as massage therapist at Great Shapes Great Shapes Fitness for Women in Carbondale recently hired certified and licensed massage therapist Katie Mercer, who previously worked at InSync. Mercer brings more than 12 years of experience to Great Shapes.

Gullett joins Allied Physicians and Rehab

Pass honored for flag contribution

Dr. Ryan Gullett, a chiropractor who was raised in Carterville, recently joined Allied Physicians and Rehab in Carbondale. Allied Physicians and Rehab offers chiropractic, physical and massage therapy.

The Long Knives Chapter of ILSSAR presented Francis Pass of One Hour Heating and Air Conditioning in Herrin with a plaque Nov. 10 and will later present him with a flag certificate for his great contribution at the Lee Greenwood concert at Du Quoin State Fair. Pass purchased 5,000 American flags to be given out before the concert by members of Cub Scout Troop 48 of West Frankfort.

Lorenz joins Belleville law firm Natalie Lorenz, a 2012 graduate of SIU School of Law and valedictorian of her class, has joined the law firm Mathis, Marifian & Richter, Ltd. as an associate. The law firm serves the St. Louis and Southern Illinois area. A native of Perryville, Mo., now living in Columbia, Lorenz intends to focus her legal practice in the areas of business law, estate planning and taxation.

Assisted living facility hosts grand opening River to River Residential Corporation’s newest assisted living facility, River to River Community of Marion South, recently hosted a grand opening celebration at 1515 E. DeYoung St. in Marion.

Rhodes 101 convenience store opens in Anna PAJCO, Inc. recently acquired the Trail of Tears Junction gas station at 148 Leigh Street in Anna. This location is the first Rhodes 101 Stop east of the Mississippi River. The Trail of Tears Junction ceased operations July 31, and Rhodes 101 began immediately on a complete upgrade of the facility. The site opened Nov. 15 as Rhodes 101 Stops Convenience Store.

SEE ACHIEVEMENTS / PAGE 18

SOUTHERN BUSINESS JOURNAL

DECEMBER 2012

Achievements Firm hires attorney, plans to open new office

Middleton to teach massage therapy course

David Lawler, who formerly worked as an assistant state’s attorney in Williamson County, recently joined Adam B. Lawler Law Firm, LLC in Marion. Additionally, the firm is planning to open a new office on the square in Shawneetown. The office is scheduled to open Dec. 15.

John A. Logan College will host a continuing education course for massage therapists from 8 a.m. to 3:30 p.m. Dec. 14. The course will be instructed by Steve Middleton, director of rehabilitation and sports medicine at Woodard Wellness Group in Carbondale. The topic will be “Advanced Manual Therapy Techniques for Massage Therapists.” For more information, contact the Department of Continuing Education at 618-985-2828, ext. 8248, or the instructor at atc_education@ yahoo.com.

Illinois Farm Economics Summit scheduled An Illinois Farm Economics Summit will be from 7:45 a.m. to 1:30 p.m. Dec. 13 at Mount Vernon Holiday Inn. “The Profitability of Illinois Agriculture: Managing in a Turbulent World” is the theme of the summit, which is sponsored by University of Illinois Extension. For those who register by Wednesday, Dec. 5, the fee is $65 per person, which includes lunch, refreshments and all meeting materials. Registration at the door will be $75 per person as space permits. Registration may be completed online at www.regonline.com/Register/Checkin. aspx?EventID1154575. For more information, contact Bridget Haas at 217-244-7657 or bahaas@illinois.edu.

Two Yoga instructors hired at Great Shapes Great Shapes Fitness for Women in Carbondale has hired two new certified Yoga instructors, Susan Bausch and Jackie Cumings. Great Shapes is at 2121 S. Illinois Ave.

Faces in the news Have you been promoted? Send a photo. Has a colleague at work completed an intensive continuing education program? Send a photo. Others in the business community will want to know it, so please consider passing on your employment news and photos to the Southern Business Journal. Feel free to email the information to sbj@thesouthern.com.

Find more business news at www.sbj.biz.

Smith awarded skin therapist certification Tracy Smith of Sarah’s Hair Design in Herrin has been awarded the exclusive Dermalogica skin therapist certification through the international dermal institute. Smith provides skin analysis and facials daily at Sarah’s by appointment, and the salon carries a full line of Dermalogica skin care products.

HMC donates to Prairie State Women’s Health Rodney Smith, president and CEO of Harrisburg Medical Center, recently presented a $567 check to Hugh Satterlee, administrator of Montgomery County and Prairie State Women’s Health Department and Pam Johnson-Meyers, public health supervisor and Illinois breast and cervical health coordinator for Prairie State Women’s Health Department. HMC participated in Medline’s Pink Glove Dance competition to help promote awareness for breast cancer and raised money by selling copies of the video to fellow employees. Prairie State Women’s Health Department offers free mammograms, breast exams, pelvic exams and pap tests to eligible women.

Curry attends statewide training session Rebecca Curry with University of Illinois Extension of Williamson County attended a statewide training session last month in Champaign. Curry was among a group of staff members, from U of I Extension’s Illinois Nutrition Education Programs, who spent

two days together learning about new curricula which will be offered to lowincome groups across the state and sharing ideas to make their programs more interactive and effective.

McQueen named Farm Bureau Certified Manager

that Banterra serves. She has served the last 11 years as vice president for Fifth Third Bank in Evansville. Banterra Bank began as a single bank in Ridgway in July 1975. Today, Banterra has 29 branches throughout Southern Illinois, southeast Missouri, southwest Indiana and western Kentucky.

Lindsay McQueen of Murphysboro, the manager of Jackson and Union County Farm Bureaus, has recently earned her Farm Bureau Certified Manager designation from the Illinois Farm Bureau. The FBCM designation recognizes county Farm Bureau managers for professional achievement and leadership. McQueen will be recognized at the 2012 Illinois Agricultural Association’s annual meeting.

Webb retires from position

Cripps joins staff at The Insurance House

Rice retires after 38 years on hospital board

Karen Cripps recently joined the staff at The Insurance House in Marion. Specializing in senior market products, including Medicare supplements, longterm care and life insurance options, Cripps comes to The Insurance House with a number of years of experience in insurance, as well as 14 years in her previous profession in geriatrics. The Insurance House is an independent insurance agency, a Dave Ramsey endorsed local provider, at 205 S. Market St. in Marion.

Harold E. Rice, longtime president of Marshall Browning Hospital Board of Directors, recently retired from the board. Rice joined Marshall Browning Hospital as a board member in 1974 and was named board president in 1979. During his tenure, he worked with four administrators and was instrumental in leading the hospital through many major building projects.

Frey delivers session at conference Dr. Deborah Frey, CEO/lead executive coach at FreyWorks & Associates Consulting in Makanda, delivered a session entitled “Team Dreaming: Leadership for Collaborative Impact,” at the 21st annual Garden State Council Society for Human Resource Management Conference and Expo from Oct. 21 to 23 at Atlantic City Convention Center. Geared to human resource and business practitioners, the conference offers more than 40 concurrent sessions.

Becht named director of retail operations Debra Becht recently joined Banterra Bank as director of retail operations. A resident of Evansville, Ind., Becht is familiar with the four-state, Midwest area

Irene Webb of Vienna recently retired from her position as enumerator/ interviewer with the National Association of State Departments of Agriculture. Webb began her job with NASDA in 1995 and has received numerous awards throughout her 17 years. She and her husband, Ramon, make their home and operate a farm in rural Vienna.

Rushing attends retirement distribution seminar Jeffrey S. Rushing of Marion, a Modern Woodmen of America representative, has completed a five-day educational program at Modern Woodmen’s home office in Rock Island. The advanced training program focused on helping business owners with Modern Woodmen life insurance plans, annuities and IRAs. Additional emphasis was given to the use of employee benefit plans in various types of businesses. Training also included strategies to help provide income from retirement assets and pension plans to those approaching retirement.

Wright receives accreditation Dishona Wright of Staged Wright Home Designs in Anna recently received her second accreditation in home staging. In addition to being a certified home staging expert, she has earned her certification as an international staging and redesign professional.

DECEMBER 2012

SOUTHERN BUSINESS JOURNAL

Achievements Wright has more than 25 years of experience as a visual merchandising specialist.

Romine joins Western Baptist Hospital staff Orthopedic surgeon and sports medicine physician Spencer Romine, M.D., recently joined the medical staff at Western Baptist Hos-pital. He is accepting new patients at Orthopedic Institute of Western Kentucky in Paducah.

Huffman Insurance Agency opens new office Huffman Insurance Agency in Cairo, founded in 1960 by Joseph A. Huffman Sr., recently hosted a grand opening celebration for its new office at 2035 Washington Ave. in Cairo. The 7,000square-foot office building will house the current staff of four agents. The agency, which will expand with the

addition of new staff and insurance products, has two locations — the new office in Cairo, as well as a second office at 146 B E. Vienna St. in Anna.

McClerren joins staff of SI Elder Law Cindy McClerren of Thompsonville has joined the staff of SI Elder Law as director of business development. McClerren has experience working with supportive living facilities in Illinois and recently served as director of marketing and sales at Heritage Woods of Benton. The Marion-based SI Elder Law works to protect assets of seniors needing nursing home, assisted living or care at home.

Hospital earns recognition Good Samaritan Regional Health Center recently was named one of the nation’s Top Performers on Key Quality Measures by The Joint Commission, a

leading accreditor of health care organizations in America. The Mount Vernon hospital was recognized by The Joint Commission for exemplary performance in using evidence-based clinical processes that are shown to improve care for conditions, including heart attack, heart failure, pneumonia and surgical care.

Three re-elected to banker’s association Several local bankers were re-elected to positions with Community Bankers Association of Illinois at the association’s annual convention recently in St. Louis. Kevin Beckemeyer, president/CEO of Legence Bank in Eldorado, was re-elected regional vice chairman of CBAI. Joe Leenerts, executive vice president/CEO of Herrin Security Bank, and David Pirsein, president/CEO of First National Bank in Pinckneyville, were both re-elected group directors.

Baptist Prime Care opens on hospital campus Baptist Prime Care opened recently at its new location on Western Baptist Hospital campus, offering easy access to primary care six days a week. No appointments are needed at the new location, which offers designated parking. Hours are 7 a.m. to 7 p.m. Monday through Friday and 8 a.m. to 1 p.m. Saturday. The new address is Doctors Office Building 1, Ste. 103, 2601 Kentucky Ave., in Paducah.

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Pepsi MidAmerica Wishes You Holida A Happy and Safe Holiday! 7 UP Cake with Coconut Frosting Recipe Ingredients Cake: 1 cup butter, softened ½ cup vegetable shortening 2 ½ cups sugar 5 eggs 1 teaspoon lemon extract 3 cups flour 7 ounces, 7UP, at room temperature

Coconut frosting: 1 egg, beaten ¾ cup sugar 1 tablespoon flour 2 tablespoons butter 8 ½ ounces crushed pineapple, undrained 3 ½ ounces flaked coconut

Directions: Preheat the oven to 300 degrees. Grease and flour a 10-inch tube or Bundt pan and set aside. In a large bowl of an electric mixer, beat together butter and shortening with the sugar until light and fluffy, about 4 minutes. Add eggs, one at a time, beating well after each addition and scraping down the sides of the bowl with a rubber spatula. Add lemon extract. Add flour and 7UP alternately, beating after each addition. Spoon batter into prepared pan and bake for 80 minutes or until cake tests done. Remove from oven and place pan on wire rack to cool for 30 minutes, then turn out cake onto wire rack to cool completely. Prepare icing: In a small saucepan, cook egg, sugar, flour, butter and pineapple with juice over very low heat (if heat iss too high, the egg will curdle). Stir frequently and cook until thickened, about 15 minutes. Remove from heat. Stir in coconut and blend well. Spread on cooled cake.

www.pepsimidamerica.com 1.800.827.7020

DECEMBER 2012

SOUTHERN BUSINESS JOURNAL

Business Fine Print Building permits Herrin Greg Perkins, 1002 N. 9th St., $5,000 Daniel Strange, 905 S. 14th St., $52,000 Roger Zeigler, 505 N. 13th St., $0 John Goebel, 601 Tatum Lane, $110,000 Tim Murphy, 2004 S. Walnut, $0 Tim Murphy, 403 Insignia, $0 John Goebel, 1619 Dolan St., $136,500 Dorothy Williams, 805 S. 14th St., $4,300 Robbie Randolph, 2904 Weaver Road, $9,700 Thomas Sanchz, 3200 Arabian Court, $0 Paula Resavage, 1309 N. 14th St., $0 Seever Homes, 2304 Elias Drive, $200,000 Tom Cull, 116 Forest Park Drive, $85,000 Dave Stritzel, 2005 S. 27th St., $20,000

Marion James Hanson, 1705 Remington Cour t, $1,500 Jerr y Webb, 1505/1507 W. Central, $510,000 Barnett and Son Construction, Lot 2 N. Bentley, $100,000 SI Properties, LLC, 1701 Easy St., $250,000 JRJ Rentals, LLC, 1502 Colin Bradley Drive, $240,000 JRN, Inc. 1401 W. De Young, $1,297,000 Mike Thomas, 1112 W, Concord, $27,000 Richard Morgan, 911 N. Market, $75,000

Metropolis Joyce and Ernest Morris, 1700 Ferry St., $5,500 Dana Legereit, 7094 Midway Road, $3,500,000

Mount Vernon Lea Dodson, 1113 Veterans Memorial Drive, $5,157 Cedar Hurst/Motor Cycle Days, 1400 Broadway, $0 JC Challenge, 1400 Broadway, $0 Jeff Ramsey, 12252 Harlan Road, $70,000 Jeff Ramsey, 12252 Harlan Road, $0 TriState Metal Detecting Club, 800 27th St., $0 Burkdell Mulch, 300 Fairfield Road, $0 Samuel Shillingburg, 2700 Richview Road, $0 H&H Advertising, 4211 Broadway, $35,000 DaVita Inc., 4102 N. Water Tower, $840,000 GSRHC-Day Care Center, 1 Good Samaritan Way, $1,900,000 Jim Scott, 404 Perkins, $0 Jason Staats, 900 6th St., $0

Terry and Laura Schaubert, 102 9th St., $196,000

Find more business news at www.sbj.biz.

Murphysboro William Douglas, 239 S. 9th St., $600 Martha Hendricks, 1503 Tina Drive, $19,487 Dan Bratton, 12 Suburban Drive, $1,500 John Keller, 825 N. 22nd St., $29,000

Bankruptcies Chapter 7 Carl Stanley Starrett, 213 N. Oak St., De Soto Robin Lynn Popejoy, 3590 Norwood Lane, Tamaroa William E. and Kelly J. Miller, 444 Kaskaskia St., Chester Gregory W. Wilkinson, 1228 N. Market St., Mount Carmel Rickie S. and Alice A. Beckum, 2464 Crane Road, Venedy George A. and Carrie K. Polak, 8305 Illinois 146 West Darlene M. Kwasniewski, 711 S. Virginia Ave., Marion Amy Kay Voyles, 215 S. Walnut St., Du Quoin Anthony Wayne Thompkins, 200 Commerce St., Apt. 5, Carmi Marietta Ragsdale, 1315 Dorris Heights Road, Harrisburg Judith Gale Cutchin, 711 Elm St., Carmi Mar tha Elizabeth Abbott, 968 Vine St., New Haven Keri Beth Edwards, 18463 Galatia Post Road, Marion Linda Chew, 7276 Peach Lane, Carbondale Michael Chew II, 1201 S. Maple, Carterville Barbara Jo Morris, 109 N. Vicksburg, Marion Billy Gene and Judith Lynn Weddle, 1205 W. Adams St., Herrin William Eckhoff, 26887 Woods Road, Centralia Roger D. and Shirley C. Russell, 70 Hummingbird Road, Buncombe Jack A. and Janice L. Crawford, 731 Sheridan Drive, Benton Chase William and Megan Nicole Jarrett, 2520 New Era Road, No. 19, Murphysboro Lisa A. Harris, 904 S. 12th St., Mount Vernon Edgar O. Haertling, 12002 Rockcastle Creek Lane, Steeleville Daniel E. and Jericka M. Woodwor th, 213 Second St., Mounds Michael L. Etherton, P.O. Box 193, Alto Pass Susan Etherton, 301 Freeman St., Anna Barbara L. Hart, P.O. Box 249, Willisville

Duane A. and Sherri J. Bean, 600 N. Madison, Benton Rosie L. Ervin, 2103 W. Sunset, Carbondale Paul D. Mayhugh, 909 Whitecotton Drive, Carterville David Eugene and Deborah Kay Mayberry, 4365 E. Vienna St., Anna Dudie M. Holder, 501 N. Emma, West Frankfort Daniel Joseph and Joann L. Coke, 109 N. Fifth St., Coulterville Debra Reagan, 709 N. 17th, Herrin Charles R. and Jeanene Ballard, 412 N. Parkhill, West Frankfort Melody R. Schierbaum, 417 Schierbaum Lane, Olmsted Steven L. and Carrieann Edgin, 19521 E. Illinois 14, Ewing Martha M. Carlton, 34 Lewis Lane, Benton Arthur Van Zandt, 757 Old Johnston City Road, West Frankfort Lisa M. Pritchett Williams, 2155 Lone Oak Road, Raleigh Joseph T. and Lisa K. Moore, 19594 Illinois 14, Macedonia Stephanie E. Schaefer, 204 Cherry Ave., Ellis Grove Raquel L. Ashby, 219 S. Oak St., Ina Benjamin D. Harrison, 7573 Fairview Road, Mulkeytown Jessica L. Akin, 14103 Illinois 149, West Frankfort James J. and Jamie L. Dyszczakowski, P.O. Box 367, Herrin Amber C. Lewis, 326 N. Miller, Carrier Mills Michael S. and Toni K. McKinnies, 3104 Cherry St., Mount Vernon Jeffrey S. Grizzell, 310 W. Fourth St., Apt. B, Johnston City Lori A. Newton, 22915 N. Hails Lane, Texico Trenton L. and Haylee D. Zumwalt, P.O. Box 15, Shawneetown Randall G. and Patricia L. Merritt, 419 College Blvd., Carmi David R. and Cynthia D. Wright, 490 Pankey Road, Carrier Mills Eric Sterling and Lynn Ann Bethard, 1701 Grove St., Mount Vernon Robert Lee and Diana Sue Goss Sr., 607 E. Boulevard, Marion Sean J. and Angela D. Hicks, 8 Circle Drive, Mount Vernon Kacey Rhea Willis, 509 W. Fifth St., Metropolis

Jesse Lee Ferguson, P.O. Box 76, Muddy Tammy L. Hull, 10003 Old Illinois 13, Lot 5, Murphysboro Michael Charles Rury, 4512 Quail Ride Road, Pinckneyville Roger Leroy Chatman Jr. and Stacy Elizabeth Harrison Chatman, Rt. 2, Box 192, Wayne City Keith Edward and Connie Deannine Cook, 485 Old Broughton Road, Eldorado Sarah Elizabeth Kempfer, 10774 Burgdorf Road, Red Bud Janice L. Hampton, 2036 Dewey St., Murphysboro Donald G. Hopkins, 107 E. Smith St., Benton Rodney Dean Bird II, 1211 W. Schwar tz, Apt. 2, Carbondale Joshua C. Mar tin, 460 Beagle Road, Stonefort Dana M. Jones, 1507 Catherine, Metropolis David Allen and Aimee Michele Johnston, P.O. Box 2993, Carbondale Sarah Joy Bowen, 1318 N. Cherry St., Mount Carmel Donald E. Long, 1900 N. Main St., Apt. 10 B, Eldorado Rhonda D. Heifner, 307 N. 10th, Benton Mark A. and Kathy A. Lee, P.O. Box 256, Cutler Bobby J. and Carolyn S. McGhee, 5471 First St., Mulkeytown

Chapter 13 John C. and Marilee Clark, 16618 Frisco Road, Ewing Kira M. Bacon, 11965 U.S. 45 North, Ozark Judith A. Georgeff, 2112 Pine St., Murphysboro Elizabeth R. Jones, 3334 Joppa Road, Metropolis Dorie S. Schaefer, 57 No. 2, Carbon Lake Road, Murphysboro Lyle D. and Patricia A. Newell, 14593 Paulton Road, Pittsburg John M. Blackstock Jr., 909 E. McKinley, Marion Edgar D. and Karen M. Houghlan, 561B Buck St., Elkville Scott A. May, P.O. Box 550, Hurst Linda J. Kerr, P.O. Box 327, Olmsted Clinton R. and Diana L. Alton, 2204 E. Elm, West Frankfort Zenobia T. Johnson, 620 26th St., Cairo David W. and Michael L. Sheriff, 68 Blossom Lane, Carbondale Jason Alfeldt, 264 W. Main St., Oakdale SEE FINE PRINT / PAGE 22

SOUTHERN BUSINESS JOURNAL

FINE PRINT FROM PAGE 21 Debra K. Rowedda, 702 S. Pine, Zeigler William E. Yunker, 1306 E. Sixth St., West Frankfort Terry L. and Christina L. McCarty, P.O. Box 515, Ridgway Marcena Althoff, 103 E. Heacock St., Jonesboro Jean M. and Brittany N. Segatto, 1202 Putnam, Benton Flovest Ellis, P.O. Box 58, Thompsonville Dwayne K. and Carol J. Throgmorton, 4096 Alum Cave Road, Marion Steve W. and Gayla M. Peavey, 12389 S. County Line Road, West Frankfort Matthew P. Knoop and LaTonay R. Johnson, 414 Winters St., Du Quoin Charles J. and Joyce Lynn Juenger, 2004 W. Psalm Drive, Murphysboro George L. Sample and Laura Lea Marshall Sample, 12147 Songbird Road, Marion Rober t J. and Brenda S. Campion, 9915 Karnes Road, West Frankfort Eddie E. and Linda N. Fulford, 2021 Mallard Lane, Carbondale Kimberly Damille Lockinour, 3016 W. Sunset Drive B, Carbondale

DECEMBER 2012 Spring M. Anderson, P.O. Box 383, Cairo Micheal W. and Toni L. Goodin, P.O. Box 352, Shawneetown Mark E. Webster, 1009 S. Odle St., West Frankfort Frank J. and Carmen R. Ferris, 202 Prairie, Zeigler James E. and Michelle D. Hale Jr., 122 South Illinois 3, Thebes James T. Dewey, 1 Happy Ours Lane, No. 15, Murphysboro Ricky L. Cast Jr., 516 N. Main St., Anna Hope M. Clark, P.O. Box 19, Sparta Gary L. and Shirley R. Green, P.O. Box 330, Creal Springs Paula M. Engleby, 200 Bankston Church Road, Harrisburg Larry R. Orr Jr., 210 S. Holland, Marion Lori L. Little, 203 E. McDonald St., Apt. B, Marion Michael S. Penrod, 19 N. Railroad St., Pomona Matthew S. Denbow, 107 W. Lincoln St., Harrisburg Patricia A. Davis, 713 Gardner, West Frankfort Shannon L. Buckner and Jason M. Jauch, 14059 Burton Road, West Frankfort Amy L. Chaney, 400 E. Ford St., Energy Lonnie R. and Jennifer A. Darter, 1404 N. Glendale St., Marion

Keyana L. Johnson, 202 N. McKinley St., Mounds Katina M. Reed, 509 Pearl St., Mound City Darlene A. Courtoise, 809 E. Main St., West Frankfort John L. and Jennifer L. Gipston, 814 McKinley, Benton Timothy D. and Susan A. Bain, 904 Lime, Mount Vernon Stephanie L. Butts, 108 S. Ash St., De Soto Vivian S. Markus, 6269 Orchard Road, Metropolis Michael L. and Lisa E. Rice, 513 Walnut, Du Quoin Geraldine Robinson, P.O. Box 3001, Carbondale Timothy E. and Summer A. Rulevish, 4208 Illinois 154, Pinckneyville Kevin R. and Cher yl R. Commean, 802 Wastena, Apt. A, Benton David A. and Sara E. Sloan, 2217 College St., Mount Vernon Lance L. and Tracy L. Newman, P.O. Box 34, Pittsburg Henry D. and Cheryl L. Nicolaides, P.O. Box 2912, Carbondale Dustin R. Griffith, P.O. Box 123, Harrisburg Tina and Robert Stucker, P.O. Box 4, Hurst Michael R. and Paulette R. Shaw, 695 Circle Drive, Tamms

Calendar Dec. 12 Starting a Business in Illinois: 1 to 3 p.m., room 150, DunnRichmond Economic Development Center, 150 E. Pleasant Hill Road, Carbondale. Free. An optional business start-up kit is available for $15. Call 618-536-2424 or email sbdc@siu.edu.

Jan. 8 Starting a Business in Illinois: 5 to 7 p.m., room 150, DunnRichmond Economic Development Center, 150 E. Pleasant Hill Road, Carbondale. Free. An optional business start-up kit is available for $15. Call 618-536-2424 or email sbdc@siu.edu.

Larry W. and Jane A. Stowers, 109 E. Scott St., Benton Timmy L. Scroggins, P.O. Box 68, Christopher Jeffrey C. Rako, 1807 E. Main St., Marion

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DECEMBER 2012

SOUTHERN BUSINESS JOURNAL

COVER: Business forecast FROM PAGE 4 productive, just trying to hold things together.” Still, he remains optimistic. “If the economy turns around, we’ll be fine and hopefully, can even start hiring again,” he says. “Business people who are go-getters will find customers,” he says. “I hope we’ll do well.”

Media Ongoing shifts in how people are informed and entertained have changed the media landscape. Experts predict the trend to continue. “Over the next 12 months, I expect we’ll see a continuing shakeout of how people opt to get their news,” explains Bob Williams, publisher of The Southern Illinoisan and Southern Business Journal. “With things like mp3 players, DVRs, tablets and smartphones, people have more opportunity to control where and when they get their media. With so many media choices, it is even more important that we find ways to meet those needs.” Williams says his publications are striving to meet those ever-changing needs. “The exciting part now is that it is all about local news and getting that news to people when and where they want it,” he says. He says the newspaper’s website, www.thesouthern.com, had more than 2.5 million page views in October alone, plus 500,000 additional views on mobile devices. “Like for any business, for us it is about taking care of the customers that are right in front of you,” he says. “We’re actually reaching more people than we ever have before in the history of The Southern.”

Real estate The outlook for real estate and home sales is brighter, says Carbondale real estate agent Leslie Pankey. “I think it will be a good year, and I anticipate that interest rates will remain low,” she says. “Lenders have money to loan and we have buyers.” She says, as in recent years, while the upper-end of the housing market will be a little slower, home sales in the lower price ranges will continue to be strong. Pankey cautions that because of the number of homes available, sellers must be prepared. “We have to make sure that homes are

Find more business news at www.sbj.biz. in tip-top condition and priced aggressively so they will sell before the competition,” she says.

Service industries Greg Berner of Pro Deck Builders in Elkville anticipates business for service providers will be “out there” in 2013, but getting the work will require some extra effort on the part of business owners. “I think you’ll have to go out and knock on doors to find business next year,” he says. “In general, I think things will still be tight next year and the people will continue to hang on to their money.” Berner says service businesses need to find creative ways to keep their message in front of consumers.

Tourism Perhaps the brightest outlook for the region is in the area of tourism, says Jo Kathmann, president and CEO of Swansea-based The Tourism Bureaus IllinoiSouth, which promotes visits to 19 south-central Illinois counties, including Monroe, Perry, Washington and White counties. She says tourism has an extensive economic impact. “In Illinois, more than 288,000 jobs are related to tourism and every $1 spent on tourism promotion earns $6 in state and local tax revenue,” she explains, adding that she expect even more next year. “Tourism dollars were up by 8 percent in 2011,” she says. “By every indication, tourism continues to increase at a steady pace.”

Retail Finally, what about retail in 2013? Sherry Taylor, executive director of the Carbondale Chamber of Commerce, predicts a good year. She says the business owners she’s asked “how’s business?” have told her things are going well. She says it is a good sign. “I think that is a great indicator as to the projected success in 2013, as people were singing a bit of a different tune when looking toward 2012,” she says. LES O’DELL of Carbondale is a regular contributor to Southern Business Journal and The Southern Illinoisan.

Fear of ‘cliff,’ impact of storm slow consumer spending BY MARTIN CRUTSINGER THE ASSOCIATED PRESS

Americans cut back on spending last month while their income remained flat. The weakness in part reflected disruptions from Superstorm Sandy that could slow economic growth for the rest of the year. The Commerce Department said consumer spending dropped 0.2 percent in October. It was the weakest figure since May, and it compared with a 0.8 percent spending increase in September. Income had risen 0.4 percent in September. Work interruptions caused by the storm reduced wages and salaries in October by about $18 billion at an annual rate, the government said. The storm affected 24 states, with the most severe damage in New York and New Jersey. Consumers may also be scaling back on spending because of fears about the “fiscal cliff.” That’s the name for automatic tax increases and spending cuts that will take effect in January if Congress and the Obama administration fail to strike a budget deal by then. “The upshot is that although both incomes and spending will probably bounce back in November, the underlying trend is weak,” said Paul Dales, senior U.S. economist at Capital Economics. The depressed spending figures suggest that the economy is growing more slowly in the OctoberDecember quarter than it did in the July-September quarter. Consumer spending drives nearly 70 percent of economic activity. Dales predicts U.S. economic growth will tumble from the 2.7 percent annual rate in the July-September quarter to a weak 1 percent in the October-December period. That’s not enough to lower the unemployment rate, now at 7.9 percent. Even discounting the effects of Sandy, income and spending gains would have

been meager. Income would have risen a still-weak 0.1 percent. Spending would have been essentially flat, Dales estimated. After-tax income adjusted for inflation fell 0.1 percent in October. And spending, when adjusted for inflation, dropped 0.3 percent _ the biggest such decline in three years. The saving rate edged up slightly to 3.4 percent of after-tax income in October, compared with 3.3 percent in September. Many economists say growth will rebound in the New Year once the rebuilding phase begins in the Northeast. And if President Barack Obama and Congress can reach a budget deal to avert to fiscal cliff, some economists, including Federal Reserve Chairman Ben Bernanke, are predicting a strong year for the economy. Still, the storm’s impact has slowed sales in the nation’s most densely populated region ahead of the crucial holiday shopping season. The International Council of Shopping Centers said 18 major retailers reported sales rose 1.7 percent in November compared with the same period a year ago. The group had been expecting sales growth between 4.5 percent and 5.5 percent. The economic damage from the storm may be starting to fade, though. Retailers are reporting solid sales over the Thanksgiving Day holiday weekend. And applications for unemployment benefits have fallen from an 18-month high in the first week of November. That surge was driven by applications in New York, New Jersey, Pennsylvania and Connecticut. Still, the increase in unemployment applications earlier this month will likely depress job growth for November. Many economists predict that net job growth for November will range between 25,000 and 75,000 _ well below the 171,000 jobs that were added in October.