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women-owned businesses or husband/wife partnerships. In many 

 cases, you will find a son or a daughter also sharing in the family 

 enterprise. 



3. Thirdly, while the Small Business Administration may define 

 "small businesses" as those with 500 to 1,500 employees, a retailer in 

 Sitka with five full-time year-round employees is considered large. 



4. Finally, because of our size, most of our small businesses — even 

 if incorporated -- are required by the lending institutions to assume 

 full debt responsibility. This means that we lack the ability of big 

 corporations to protect personal assets. 



These circumstances make us extremely vulnerable to any event that 

 would reduce Sitka's population or current economic stability. In the 

 event of the loss of a major employer, what would be our options? 



First, we are not chain-store operations. While extended chain-stores 

 may balance losses in one location with a flourishing operation 

 elsewhere, small businesses in Sitka have no choice but to ride the 

 economy to the bottom. 



Secondly, our small size is reflected not only in the relatively few 

 employees but also in the level of inventory which our current 

 population base can sustain. Many businesses in Sitka operate at or 

 near the minimum quantity orders that wholesale suppliers will fill; 

 this is particularly true during the period September-May when 

 fishing and tourism are at minimal levels. What this means is that 

 we have almost no flexibility — either through employee or 

 inventory reductions — to adjust to a significant change in Sitka's 

 population base. 



And, finally, since our businesses and personal property are tied 

 together in small business financing, we have no protection from the 

 loss of our homes and personal assets when our businesses fail. 



