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Economy

New year, new costs for local businesses

A triple whammy of high power bills, an increase to the minimum wage and even the soaring price of eggs are hitting small businesses in San Diego.

It's all a bit too much for Meghan Smith, who owns Batch and Box Signature Cookies in Carmel Valley.

“You are constantly having to juggle all these balls and think about how it impacts your employees and how you want to reward them, and you want to pay for benefits,” she explained.

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Starting this month, the minimum wage in San Diego rose from $15 an hour to $16.30 an hour. Great news for employees, but it’s another cost to manage for small business owners. Smith said she's even considering using machines instead of people for some of the work at her store at Del Mar Highlands Shopping Center.

“My husband is actually a mechanical engineer and has a master’s in robotics,” she said, “He’s working really hard on how to automate a lot of our processes, particularly how we roll dough balls, how we package things so that we don’t have to rely on labor so much, and we can still provide quality products and an exceptional experience, while still keeping our prices reasonable.”

The huge spike in the cost of eggs is another headache for Smith, whose business goes through more than 200 dozen per week. California has some of the most expensive eggs in the country right now, with a box of 12 large ones costing around $6.

And then there are new gas and electric rates, which have seen a large increase from commodity prices. Bills have doubled for many San Diego Gas & Electric customers, with households who paid around $105 last January facing bills of around $225 this month. SDG&E blames the high cost per unit of natural gas for the steep rise, and all this has left Smith with no choice but to up the price of her cookies.

One local non-profit, however, is on hand to offer some much-needed support and advice. Business For Good provides resources to locally run companies and advocates for policy change.

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“This year, we’re actually launching a new series of workshops that specifically focus on employer help, any type of marketing, operations cause we know how hard it is out there,” managing director Danea Ramos said. “And if we can help them as much as possible to be as efficient as possible, and let’s say give them as many resources as we can, we can do that as well.”