By CAROLINA MADRID
Cronkite News Service
DOUGLAS _ G.T. Bohmfalk remembers the days when shoppers flooded in from Mexico to buy from his western wear and saddle shop and from other merchants along G Avenue in this border community.
But business is worse than heâ€™s seen since he began running the family-owned Marlinâ€™s Saddle Shop in 1986.
â€œIâ€™m getting battered at every turn,â€ he said. â€œEven people in their 70s who have been working here say, â€˜I donâ€™t know how you make it,â€™ and the truth is, I donâ€™t know how Iâ€™m making it.â€
G.T. Bohmfalk, who manages Marlinâ€™s Saddle Shop in Douglas, says business from across the border is the worst heâ€™s seen since he started in 1986. He and other business owners blame a slide in the pesoâ€™s value.
(Cronkite News Service Photo/Carolina Madrid)
But for businesses in Douglas and other border towns in Arizona, the problem is bigger than just the shaky U.S. economy. A slide in the pesoâ€™s value against the dollar has made it more expensive for Mexicans to shop in the U.S., so fewer customers are making the trips across the border.
In April, the average exchange rate stood at 13.3944 pesos to a U.S. dollar as opposed to 10.5146 in April 2008, a decline of 27 percent.
â€œItâ€™s just not worth it for them these days,â€ Bohmfalk said.
Lupita Ruiz and Enrique Torres, assistant managers at a Factory 2-U store down the street, said 80-90 percent of their customers come from Mexico. Sales have plummeted along with the pesoâ€™s value.
â€œEvery day is worse for us,â€ Ruiz said in Spanish. â€œWeâ€™ve started closing two hours earlier, and a lot of employeesâ€™ hours have been cut.â€
Torres said their regional manager tried to boost business at border stores by offering to buy the peso at a flat rate of 10 during the holidays.
â€œBut I donâ€™t think it was worth it for him, or he was losing money, because that only lasted a few weeks,â€ Torres said.
Jose Mendez, an economist focusing on international trade at Arizona State Universityâ€™s W.P. Carey School of Business, said the pesoâ€™s slide is an indication of Mexicoâ€™s strong dependence on the U.S. economy.
â€œI would not have expected it, but I suppose because all of their sales are to the United States, the dollar has weakened, but the peso has weakened even more so,â€ Mendez said.
Joe Morris, store manager for Wal-Mart in Nogales, said the exchange rate isnâ€™t the only factor that has put a damper on border businesses.
â€œThat, combined with the long waiting times to cross and increased security, has just discouraged a lot of people from making the trips,â€ Morris said in a telephone interview. â€œTheyâ€™re just staying in Mexico.â€
Olivia Ainza-Kramer, president of the Nogales-Santa Cruz County Chamber of Commerce, said that April proved better than March.
â€œI think that right now, though, this is a general, nationwide issue,â€ Ainza-Kramer said in a telephone interview. â€œThe uncertainty in shopping has also affected the Mexican consumer.â€
Ken Rosevear, executive director of the Yuma Chamber of Commerce, said wait times at the border have always been a concern for there.
â€œWe have a meeting once a month with the customs people about keeping the line moving because people just turn around and go back home if they have to wait too long,â€ Rosevear said in a telephone interview.
Mendez, the ASU economist, said Mexicoâ€™s economy will improve when the U.S. economy picks up.
â€œI guess the bright side is that itâ€™s equally sensitive on the upside, in terms of strengthening,â€ he said. â€œOnce the U.S. economy starts to move out of the recession, then Mexicoâ€™s situation will improve.â€
But Bohmfalk, owner of the saddle shop, said U.S. Customs should try to make the border-crossing process easier for Mexican shoppers.
â€œIt canâ€™t be so burdensome for the shoppers,â€ he said.
Elena Verdugo, manager at a Dollar Tree store in Douglas, said long lines have always been a problem.
â€œItâ€™s more the peso (exchange rate) that has been hurting is,â€ Verdugo said in Spanish. â€œI just hope it gets better soon.â€