Stylist Cheryl Vasquez creates a new look for customer Natalia Nemeth at Artlab salon at 1410 Montana Ave. on Friday afternoon. (photo by Brandon Wise)

OCEAN PARK BLVD — The skyrocketing unemployment rate and the increasingly growing presence of going-out-of-business signs and bankruptcy filings all crossed Ingrid Morgan’s mind when she decided to start a restaurant.

But for the British native, who opened the Sunset Cafe in February, starting a business was a life-long dream.

With her sister, Michelle, and friend, Alyson Wyatt, the three Brits decided to open the restaurant at the former home of the Sunset Grill on Ocean Park Boulevard, changing the name but hiring the same chef and essentially keeping the menu intact, adding a few specialties from their home country.

“We’re in a rough economy but we’re doing OK,” Morgan, who also works at the British Consulate-General’s office in Los Angeles, said. “We’re hanging in there.”

A dauntingly tough financial time, which has forced consumers to cut back on spending, has done little to discourage entrepreneurs from opening up shop in Santa Monica over the past year, some of whom actually report that business has been good.

David Abrams, who in November opened artlab on Montana Avenue with business partner Jason Lara, said that the hair salon has received a steady stream of clients over the past several months, pointing out that his other business, LuxeLab, which is located next door, is enjoying its best year to date.

He believes the issue specifically with Montana Avenue, which has seen more than 30 businesses leave in the past year, has less to do with the recession and more with a natural rebirth.

“It’s spurred by the already-in-motion changes that are starting to happen,” Abrams said.

David Choi, an assistant professor of entrepreneurship at Loyola Marymount University, said a new venture’s chances of surviving depend on the type of business, noting that retailers of a high-end products or services might have a lot of trouble since those are the areas in which consumers are staying away.

“Anything that is not a necessity but a luxury right now would not be a good time,” he said.

Those interested in starting a research and development or technology firm could have better luck thanks to the federal stimulus package that comes with grants for such new businesses, he added.

The trick for potential businesses interested in opening during a recession is finding the right time to launch before the market picks up again, especially in real estate where rent could easily jump right back up.

David Whitworth, who is planning to open Pizza Fusion on Ocean Park Boulevard in mid-May, said he believes it is more crucial to begin business as soon as possible because of the rent he’s paid over the past year. The business will specialize in pies made from organic ingredients.

“There is no perfect time,” he said. It’s a tough time right now but I think that it will get lighter pretty soon and we’ll be ready.”

The Chamber of Commerce has began offering some services to help its members weather the economic storm, including allowing monthly instead of annual payments, making them one of the few organizations on the Westside to do so.

The chamber also offers seminars for prospective businesses and quarterly educational series on different topics, including health and marketing.

Edward Van Brusselen, the members services manager for the chamber, said that the organization has also began giving free mixer passes to prospective and new businesses.

Approximately 175 businesses have joined the chamber since the beginning of April 2008, more than 44 of which have been added since January. About 75 percent of those members are new businesses in the city.

But about 200 members have left the chamber since April of last year, much of which was a result of businesses closing or leaving Santa Monica. Many business owners said they couldn’t afford the chamber membership, which is on a sliding scale based on the number of employees, Van Brusselen said.

For Andrew Steiner, who opened Andrew’s Cheese Shop on Montana Avenue last August, business has been steady, but a drop in the past two months has given the owner a cause for concern.

“Early April has been horrendous and it makes me think we are not going to make it,” he said.

He said that word has been spreading more and more about the store, which offers several hundred varieties of cheeses. Steiner has began hosting more events at night and hopes to receive a liquor license soon.

Abrams said he doesn’t view the recession as necessarily a bad thing.

“I see a recession as presenting a different kind of opportunity, meaning that people just change their buying habits and what a good business will do is change the way they do business to accommodate for that and add value so you make it that people can’t imagine going anywhere else,” he said.

His newest venture embraces a movement he sees taking shape on the Westside of Los Angeles where more mixed-use developments are popping up and residents are getting out of their cars.

The salon doubles as an art gallery and night club at least once a month, bringing in a DJ who will spin music as clients get their hair done while drinking wine.

“We came up with artlab as a partner to that new L.A. client that we saw coming out,” he said.

For Morgan, her decision to open a restaurant was to fulfill a dream and jump on an opportunity that presented itself when the Sunset Grill, of which she was a long-time customer, closed late last year.

The trio of owners kept the restaurant essentially the same but added some personal touches.

She plans to expand the business by adding catering. The business is also open during the evenings, a change from the previous ownership.

“I knew that there was a lot of potential and I still think there is potential,” she said.

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