Depleted Stocks

If you ever doubted whether you're a tough customer, look what entrepreneurs have done to the big publicly held companies that cater to small business. They're a disaster, if stock price is any indication. Of 40 companies identified by frontier as dependent on small business, more than half were selling near their 12-month lows in late July. Average decline: 52%, with many showing drops exceeding 70%. Some companies never even got to the starting pulled its public offering in May. Even companies with long track records such as Staples Inc. (down 52%) are suffering. A notable exception: Paychex Inc., the payroll processor, up about 60% this year.

What's the problem? Common themes that crop up include rising tech costs and the tough competitive environment. Likely culprits include their efforts to deliver more to small companies over the Web, and the cushy deals for free services and cut-rate products you've been enjoying. For this year, at least, you've been better off buying from their stockroom than buying their stock.