‘It is not an easy market’, businesses closing in Colorado Springs experts point to several reasons

COLORADO SPRINGS — Over the past couple of weeks, it seems numerous businesses have announced their final departure dates for the end of the year.

Longtime businesses like Mountain Shadow’s Cafe and Drifter’s Hamburgers, according to our partners at The Gazette, are among the businesses closing doors for good.

“We’ve seen a business boom across the United States, believe it or not, but we also have seen a record number of closures,” Aikta Marcoulier, Regional Director for Region 8, which includes Colorado for the Small Business Administration said.

Is it the pandemic? Inflation?

“There’s a number of factors, and these are not a surprise to any business owner in our community or across the United States,” Marcoulier said, she pointed to factors including buying behavior changing after the pandemic and uncertainty with the economy.

Marcoulier, who has worked with small business owners in the Pikes Peak Region for more than decade, said small businesses should be tapping into the myriad resources available before it’s too late.

“Every time I meet with the business, it’s the financials that get them,” Marcoulier said, “at the end of the day, it’s mounting debt versus maybe the loans they had or the economic injury, disaster loans or whatever else they had to do to put a Band-Aid to move forward, but that Band-Aid needs to be ripped off at some point, and you need to be profitable and to do that, you need to have the right plan in place, and what I see is people don’t and they don’t take a look at that.”

Downtown Colorado Springs is seeing more businesses close than in previous years, but not by much. In 2024, 23 businesses have closed, at the same time 29 businesses have opened downtown, which has a high concentration of locally owned small businesses. In the past few years, the Downtown partnership says about 15-17 businesses have closed annually.

“We have amazing foot traffic downtown, but that’s not to say that there aren’t still headwinds,” Austin Wilson-Bradley, Director of Economic Development with the Downtown Partnership of Colorado Springs said, “inflation, the rising cost of doing business, the rising cost of labor. So all those things are definitely still still playing a part.”

Wilson-Bradley points out these are not challenges unique to downtown and he’s optimistic about the future with inflation easing.

“Downtown is still strong,” Wilson-Bradley said, pointing to visitation increasing 27 percent during the most recent Small Business Saturday. Revenue is down three percent, but up one percent for restaurants and bars.

“It is not an easy market to be in right now as a business owner. Inflation costs, as I mentioned, cost of goods, supply chain disruptions, less people eating out. I mean, those are all rising costs, you know, on both sides of the table,” Marcoulier said.