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Crisis Mode

Economic crises are trickling down to entrepreneurs. How are they fighting back?

This story appears in the August 2004 issue of Entrepreneur. Subscribe »

Things look good for Matthew Stewart, co-founder of College Works Painting, an 8-year-old Santa Ana, California, home improvement and construction firm with 160 full-time employees and 3,000 seasonal workers. His business has grown 400 percent over the past five years, with company sales expected to reach $27 million in 2004.

But underneath the surface, large economic crises are threatening to chip away at the company's profit margin. College Works Painting is paying one-third more this year for gasoline-it adds up quickly when employees have to drive long distances between projects. Stewart is adjusting to rising gas prices by hiring subcontractors if a job requires a lot of driving and incorporating changes such as using five-day delivery instead of overnight mail.

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