Coletta's Lamps and Shades in Warwick to close

John Kostrzewa

Oct. 18, 2009 (McClatchy-Tribune Regional News delivered by Newstex) -- WARWICK -- The economic recovery in Rhode Island won't come soon enough to save Patricia Lena's small business.

She plans to turn out the lights at Coletta's Lamps and Shades for good on Oct. 31, after 21 years. "It's very sad for all the small companies that are closing," she said, "The economy is not getting any better."

Lena, the owner of Coletta's, survived the state banking crisis in the early 1990s, and the slowdown later that decade. She got through the recession in 2001. But when she closes the doors in two weeks, she has no plans to reopen, ever.

That's one of the tragedies of Rhode Island's recession, now in its third year.

Small businesses are disappearing at an alarming rate.

That's important because of the clusters of jobs that are lost, and the income, sales, property and other taxes that will no longer be collected to pay for state and municipal services.

It's also important because when the national expansion starts, there will be fewer Rhode Island companies ready to fill orders or provide services. It will take time for new small companies to organize, get financing and open to do business. That means Rhode Island's recovery will be slower and shallower than in other states that compete for the same contracts.

Like a lot of small businesses, Lena and her company had to change with the times over the years.

She bought an existing enterprise from Katie and Paul Coletta on Bald Hill Road in 1988 and kept the name to hold onto the customers and suppliers. Most of her sales came from selling lamps and wall fixtures.

But when the national, big box stores arrived selling similar products at cut-rate prices, she said she switched business plans to sell more replacement lamps, shades and glass. She specialized in finding or repairing silk, hard-backed, antique, paper, fabric or laminated shades. She did chandeliers, yard-sale lamps and museum pieces. He husband, Peter, did the labor-intensive repairs, on a part-time basis while he collected a full-time pay check at another company.

She expanded to land some corporate accounts from the University of Rhode Island, Rhode Island College and MetLife. (NYSE:MET PRA) (NYSE:MET PRB) (NYSE:MEU) (NYSE:MLG) (NYSE:MET)

The company became a family business, offering work to a daughter, son and daughter-in-law. She became part of a network of smaller, independent businesses, such as Greenwood Electric and Wizard Electric. When a customer couldn't get exactly what he wanted at one shop, the owner directed him to one of the other stores. The favor was returned.

Lena was able to balance the books, tightly controlling expenses for rent, utilities, supplies and compensation. She started out taking in $200,000 in revenues annually, which covered costs -- until the recession arrived in 2007.

Then she noticed fewer familiar faces were walking through the door. Last year, sales were down to $125,000 and this year there will not be enough revenue to cover expenses, she said.

With plenty of idle time behind the counter, she figured out what was going on: With more people out of work (74,000 Rhode Islanders were jobless in September, or 13 percent), and others worried about losing their jobs, consumers had less money to spend on fixing or replacing their lamps.

And Rhode Island's housing bust, with prices and sales still way off from their peaks, means fewer houses are being built. There are fewer people with the money or interest in renovating or buying an existing house. They certainly aren't in the market for lighting fixtures.

With walk-in traffic declining, Lena tried to reach out to attract new customers with targeted mailings and newspaper supplements with coupons. She's also considered building a presence on the Web.

"It was money out the window," she said.

She once tried to see if there would be a buyer for the business, but "there were no bites," she said.

Last week, Lena, 64, of Warwick, recalled that she came to Rhode Island from a tiny town near West Point, N.Y., called Cornwall on Hudson. She said Rhode Island had that small-town feel, but also had the beauty of a place where the land meets the ocean. There was good theater here, she said, and a deep, colorful history.

It's been a wonderful place to live, she said. But as a place to do business she has fewer warm thoughts.

"It's not a friendly state to get people to come to," she said, "If anything, they leave."

She mentioned the inhospitable business climate. She said the inventory tax on unsold lamps left on the shelves was costly. She said at one stage of the business she would have liked to hire more employees, so she didn't have to work seven days a week. But the taxes, specifically under the workers' compensation law, made the cost prohibitive.

"My situation right now is not all that important," she said, "But I do want to speak out for all the other mom-and-pop shops that are struggling to get by, if they haven't already gone out."

For years, motorists who stopped at the intersection near her shop on Route 2 would be attracted to the creative window display of colorful and ornate lamps and lights.

Now, behind the glass, they see a block-lettered banner that reads, "The economy is horrible. I quit!"

John Kostrzewa is assistant managing editor/commerce and consumer news. Reach him at (401) 277-7330 or jkostrze@projo.com.

Newstex ID: KRTB-0161-38940011