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Twenty Rugged Survivors in Dying Industries

  1. Adapting to Save an Endangered Business

    Adapting to Save an Endangered Business

    "Creative destruction," the term popularized by Austrian economist Joseph Schumpeter, refers to the process by which entrepreneurs introduce innovations that force established businesses to adapt or die. What does the adaptive process look like on the ground? For small business owners across the U.S., in struggling sectors that range from independent amusement park operators to shoemakers, hobby shops, and travel agencies, survival strategies range from severe service cuts to bold expansion. For a look at stalwarts whose efforts may hold lessons you can employ in your own business, flip through this slide show.
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  2. The Amusement Park: World of Wonderland

    The Amusement Park: World of Wonderland

    There are about 350 amusement parks left in the U.S., according to the National Amusement Park Historical Assn., down sharply from 480 in 1999. Independent parks experienced a wave of closings in 2004, when skyrocketing real estate prices drove many owners to sell to large chains.

    Paul and Paula Borchardt, co-owners of Amarillo (Tex.)-based World of Wonderland, took over the park from her parents in 1988. They carved a niche by focusing on family-oriented attractions in a sparsely populated area. The couple buys used equipment to keep costs low and maintains just 15 full-time employees. "In today's market, there is no cash available. There would be no way that anybody could duplicate our park with the type of equipment needed, [and] the 'corporates' are not going to buy us out because our market is too small," says Paul Borchardt. "That's why we're successful."

    World of Wonderland
  3. The Backpack Maker: Mystery Ranch

    The Backpack Maker: Mystery Ranch

    The number of manufacturers in the U.S. declined about 11 percent from 1998 to 2008, according to Census data, with many survivors moving production overseas to keep costs down.

    Dana Gleason, now with more than 30 years' experience designing backpacks, launched Bozeman (Mont.)-based backpack maker Mystery Ranch in 2000 after selling his previous backpack business, Dana Design, to K2 Corporation in 1995. Gleason says outdoor-goods dealers pushed for lower prices from the start, so in 2002 he moved production to China. When he still couldn't produce cheaply enough, he shifted his strategy and began manufacturing more expensive, heavy duty packs. "We ended up firing our old customers, who were demanding cheaper, faster, and shoddier," says Gleason. His buyers now include military members, firefighters, hunting guides, and ski guides. In the last three years, Gleason says, sales have grown tenfold.
    Mystery Ranch
  4. The Bookstore: Village Books

    The Bookstore: Village Books

    Ten years ago, the American Booksellers Assn. had 2,800 members. Now, with more retailers in the market and books going digital, the trade group's membership totals 1,700.

    "There are a few of us still around," says Chuck Robinson, co-owner of Bellingham (Wash.)-based Village Books. "We're all sitting here, scratching our heads, wondering what to do next." Clearly, Robinson has a plan. He and his wife opened their store in 1980, during what he calls the "go-go years for independent bookstores." Then, to keep up with competition from Big Box stores and online vendors, Village Books essentially became a community center. It annually hosts about 250 events and features an in-store machine that prints books for self-publishers.
    Village Books
  5. The Butcher: Fleisher's Grass-fed and Organic Meats

    The Butcher: Fleisher's Grass-fed and Organic Meats

    The traditional butcher shop is fading from American society as shoppers buy meat at supermarkets instead of at independent shops. In 2006, 5 percent of supermarket shoppers purchased meat in butcher shops, according to a survey conducted by the American Meat Institute and the Food Marketing Institute, two trade organizations. Today's estimates stand at just 2 percent.

    Since it opened in 2004, Kingston (N.Y.)-based Fleisher's Grass-fed and Organic Meats has grown each year, according to husband-and-wife team Joshua and Jessica Applestone. Open Thursday through Saturday, their butcher shop sells local, pasture-raised meat at premium prices to local and weekend customers. The shop's slowest year was 2008, when butcher sales grew just 92 percent from the year before, says Joshua Applestone. "We don't do advertising," he says. "We just go by word-of-mouth. If you are good at something -- and you don't do anything but that -- people will notice."

    (Corrects the days the shop is open.)
  6. The Commercial Printer: Suttle-Straus

    The Commercial Printer: Suttle-Straus

    Commercial printers' sales declined over 11 percent from 2000 to 2010, according to research by the trade group National Association of Printing Leadership. To survive in an age when fewer people buy printed materials, printers have had to diversify and improve productivity, says Andrew Paparozzi, chief economist of the organization's economic research center. In 2000 the average commercial printing company derived about 86 percent of its revenue from traditional lithography. By 2010, that number had dropped to 61 percent.

    John Berthelson, president of Suttle-Straus, a century-old commercial printer based in Waunakee, Wisc., knew the company would have to expand what it could offer its clients. "Most people don't want to deal with a whole bunch of vendors," says Berthelson. "They're looking for vendors who make their lives easier." He says Suttle-Straus is profitable because it reacted early in diversifying its products and services.
  7. The Drive-In: Transit Drive-In Theatre

    The Drive-In: Transit Drive-In Theatre

    Drive-in movie theaters peaked in the 1950s, when there were about 4,000 nationwide, according to Fewer than 400 endure.

    One survivor is betting that nostalgia and novelty will keep him in business. "The drive-in has much more going for it than downloading a movie or even an indoor theater," says Rick Cohen, owner of Lockport (N.Y.)-based Transit Drive-In Theatre. "It's an event." Cohen built a miniature golf course in 1995 to encourage viewers to arrive early and dine at Transit before the show unspools. He also added screens and updated the sound system. Cohen says that his theater, which closes in the winter, has regularly sold out on summer weekends since 2002.
    Transit Drive-In Theatre
  8. The Furniture Repair Store: Creative Design Guild

    The Furniture Repair Store: Creative Design Guild

    Census data show the number of furniture repair and upholstering businesses dropped more than 30 percent from 1998 to 2008. Caught between the recession and a consumer tendency to buy cheaper furniture, midsize independents have been particularly hard-hit, according to the Professional Restorers Organization.

    Luann French's Clawson (Mich.)-based Creative Design Guild is small -- just French and four employees. She has watched Detroit-area competitors dwindle amid an economic downturn that hit the city with particular fury. "When people find out the cost [of a repair], they think, 'Oh, I can go buy a sofa'" for that price, she says. French offered only repair and upholstery until she moved to a new location three years ago. She then changed the company's name from French's Upholstery and started selling furniture and fabric, too.
    Creative Design Guild
  9. The Hatter: Optimo Hat Company

    The Hatter: Optimo Hat Company

    In 1940 there were 180 U.S. hatmakers, according to the Headware Assn., the oldest group in the hat trade. Today there are 10. 

    Graham Thompson, owner of custom men's hatter Optimo Hat Company in Chicago, says the decline began after World War II, when hat companies started offering cheaper, lower-quality products in response to consumer demand. Once factories downgraded, they found it difficult to upgrade for consumers who were willing to spend more, he explains. Those individuals are Optimo's customers -- paying from $400 to $20,000 per hat. Thompson says he had around $100,000 in annual revenue when he opened in 1994; he estimates it's $1 million now. 

    Roark Johnson
  10. The Hobby Shop: Schaefer's Hobby Arts and Crafts

    The Hobby Shop: Schaefer's Hobby Arts and Crafts

    The National Retail Hobby Stores Assn. has annually lost about 10 percent of its members for the past eight years, according to Art Schaefer, chairman of the trade group's board and owner of St. Louis-based Schaefer's Hobby Arts and Crafts.

    Schaefer has kept sales steady through the economic downturn by shifting the shop's focus from items that are complicated to construct to those that can be put together quickly. "Young people don't stay in the hobby now," says Schaefer, whose grandmother founded the business in 1946. Instead of specializing, Schaefer tries to have something for everyone in the family.
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  11. The H.R. Consultant: Leadership Collaborations

    The H.R. Consultant: Leadership Collaborations

    The number of human resource consultants -- offering services that include compensation and benefits assessments to companies and retirement plan consultations to their employees -- shrank 55 percent from 1998 to 2008, totaling just over 7,000 now, according to U.S. Census data. Consultants specializing in this area have had to diversify to stay in business, says Susan Murphy, spokesperson for the National Human Resources Assn.

    Murphy has been an independent consultant for the last 10 years. Four years ago, she began to market herself as a leadership consultant, with services that included recruiting, strategic planning, and in-house training, among others. "More companies are looking for one-stop shopping," Murphy says, explaining that her business has survived because she offers multiple services to individual clients. Now expanding, she recently incorporated her business as Leadership Collaborations in Nashua, N.H.
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  12. The Luggage Dealer: It's in the Bag

    The Luggage Dealer: It's in the Bag

    From 1998 to 2008, the number of luggage and leather goods retail shops dropped 43 percent, to just under 1,200 establishments, according to Census data.

    When Chuck Weisbart opened Palm Desert (Calif.)-based It's In the Bag 20 years ago, he was just one of five travel goods and luggage stores in Southern California's Coachella Valley. Then 9/11 devastated the industry, says Weisbart -- who adds that In the Bag is thriving. "We have become travel outfitters, with everything from the outwear to the bag it all goes into." In addition to selling luggage that ranges from affordable to high-end, he offers such travel accessories as his patented Tags for Bags, as well as in-shop repairs and travel-enhancement and security classes for customers.
    It's In The Bag
  13. The Pharmacy: Barney's Pharmacy

    The Pharmacy: Barney's Pharmacy

    From 2000 to 2008, the number of independent pharmacies declined about 9 percent, to 22,728, according to data from the National Community Pharmacists Assn.'s 2009 Digest. With a steady decline in prescription drug reimbursements and competition from mail-order and national chains, many of these low-margin businesses have struggled to stay afloat. A key survival tactic has been to offer new services, says Kevin Schweers, the NCPA's vice-president of public affairs.

    "Dispensing medicines is the least of what pharmacists should be doing nowadays," says Barry Bryant, who bought Barney's Pharmacy in Augusta, Ga., in 1984. Today, Barney's has a clinic that it plans to duplicate when the pharmacy's sixth location opens next year. In 2004, Bryant started offering diabetes classes and has since added insulin-pump-training and cardiovascular classes. The pharmacy sells its curriculum to 450 pharmacies enrolled in Barney's online program. When Bryant bought the store, Barney's had yearly sales of about $240,000. Now it achieves that much in about five days, he says.
    Barney's Pharmacy
  14. The Piano Dealer: Classic Piano

    The Piano Dealer: Classic Piano

    The music products market slipped from $7.1 billion to less than $5.9 billion in the last decade, according to statistics from the National Association of Music Merchants. The piano market shrank at about twice that rate, with the number of units sold falling 28 percent.

    Gayle Ross and Tom Thompson, co-owners of Albuquerque (N.M.)-based Classic Piano, watched as four piano dealers in the city closed in the last 10 years. This husband-and wife team found a way to endure: About five years ago, they closed the brick-and-mortar store they had opened in 1997. Now they use their website to sell used pianos. With fewer overhead costs, Ross and Thompson say they make a profit by offering a combination of piano sales, repair, and tuning.
    Classic Piano
  15. The Photofinishing Store: The Finer Image

    The Photofinishing Store: The Finer Image

    As Americans continue to embrace digital cameras, the volume of photos they print is steadily dropping, according to research from trade group PMA, the Worldwide Community of Imaging Associations. In 2001, Americans printed about 30 billion photos at home and in stores. Last year, PMA estimates, that number dropped to 17.7 billion. Photofinishers, who process photographs, are disappearing.

    Barry Kaplan, owner of Danvers (Mass.)-based The Finer Image, opened his lab in 1983, during what he calls the dawning of the one-hour photo lab. To stay in business, Kaplan specialized. "I don't really [offer] a range of quality [any more]. We used to do economy print or custom print. For custom print, we'd tweak the color more, for example," says Kaplan. "I do that all the time now." Perhaps most important, Kaplan has embraced the move to digital. He says he can now do work that would once have required three or four employees.
    The Finer Image
  16. The Seltzer Delivery Service: Jerry's Soda and Seltzer Services

    The Seltzer Delivery Service: Jerry's Soda and Seltzer Services

    There are just a handful of seltzer-delivery businesses left in the country, according to John Sicher, editor and publisher of online trade journal Beverage Digest.

    Steve Soontupe bought Miami-based Jerry's Soda and Seltzer Services 19 years ago, when his competition in South Beach was about five or six delivery services. "I still have some original customers, [but] a lot of them have passed away," says Soontupe. Staying afloat has meant cutting back; he now operates his trucks during just half the week, although he still uses old-fashioned glass bottles.
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  17. The Shoemaker: Allen Edmonds

    The Shoemaker: Allen Edmonds

    As footwear manufacturers moved offshore for cheaper labor, cobblers vanished with them. "There's not a lot of need for shoe repair when people are buying $20 shoes," says Jeff Milchen, co-founder of the American Independent Business Alliance, a nonprofit that supports independent, local businesses.

    Port Washington (Wisc.)-based shoemaker and cobbler Allen Edmonds does not do cheap: The company's biggest sellers go for $225 to $325. Unlike its competitors, the company kept most of its facilities in the U.S. and focused on "medium value" dress shoes, rather than high- or low-end shoes, says Chief Executive Officer Paul Grangaard. Last year the company sold about 400,000 pairs of shoes and repaired about 60,000, he says, adding that same-store sales are up 26 percent, year-over-year.
    Allen Edmonds
  18. The Slipper Manufacturer: Sundance Sheepskin & Leather

    The Slipper Manufacturer: Sundance Sheepskin & Leather

    By 2007, 99 percent of the shoes sold in the U.S. had been manufactured overseas, according to statistics from the American Apparel and Footwear Assn. Today, U.S. slipper manufacturers still in business can be counted on one foot, according to Census figures.

    Jean and Barry Anderson, owners of Guffey (Colo.)-based Sundance Sheepskin & Leather stumbled into selling handmade slippers and other sheepskin and leather products back in 1971. Their leather supply nearly disappeared in the 1980s, when pollution concerns forced many tanneries to close. So they learned to tighten their belts. "Staying small has really saved us," Jean says. Sundance is now ready to expand. She says the 39-year-old business will open a new storefront in Buena Vista, Colo., in June 2011, its first since 1975.
    Sundance Sheepskin & Leather
  19. The Sock Manufacturer: Baker Hosiery

    The Sock Manufacturer: Baker Hosiery

    Sockmaking followed the path of other footwear in this country: overseas. In 1998, there were over 570 hosiery and sock mills, according to Census data. By 2008, 190 remained.

    "You have to redefine yourself on a daily basis" in order to survive as a sock maker, says Jimmy Baker, owner of Fort Payne (Ala.)-based Baker Hosiery. Baker began working at a hosiery mill while attending high school in the town that was once known as the nation's sock capital. He opened Baker Hosiery three years after graduating. Now, he says, to be successful "you have to find smaller volume, higher profit items." Baker focuses on specialty hunting and running socks and niche fashion items. Part of the difficulty, he says, is finding retailers that will stock his socks. To increase distribution, Baker is about to begin selling products directly from his website.
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  20. The Stationery Store: The Write Occasion

    The Stationery Store: The Write Occasion

    Estimates from the National Stationery Show indicate that about 30 percent of independent stationery shops closed their doors in the last five years, felled by an onslaught of electronic invitations, Big Box retailers, and e-tailers.

    Offering better customer service and higher-end products is keeping Wyckoff (N.J.)-based The Write Occasion in business. Storeowner Tracey Pernetti says new customers often come to her after finding that invitations they ordered online from competitors were misprinted. "When stores explode or expand, it seems like they lose sight of the business," says Pernetti. "We are in touch with the small stuff." She focuses on individual attention to build a dependable client base: customers who come to her for wedding invitations often return to get birth announcement stationery.
    The Write Occasion
  21. The Travel Agency: Travel Partners

    The Travel Agency: Travel Partners

    From December 2001 to December 2009, the number of retail travel locations declined 43 percent, according to statistics from Airlines Reporting, to 15,928.

    Agencies that survived are those that specialized, says Chris Russo, president and chairman of the American Society of Travel Agents and a longtime agency owner. After years in the business, Russo bought Travel Partners in Broomfield, Colo., just nine months before 9/11 -- when national travel came to a halt. Russo and his team began to focus on destination weddings and honeymoons. Even now, in the midst of an anemic economic recovery, his business is stable. "No matter what's happening, people are still getting married and they're still going on honeymoons," says Russo. "They may not go to Fiji this year; they may opt to go to Vegas."
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