On the Beach : Retailing: Entrepreneurs along the shore enjoy the lifestyle, but their operations are at the mercy of recessions and the elements.

They come from South Korea, Philadelphia, Hawaii and Van Nuys. Former engineers, manufacturers and personnel directors, they are 60-ish and 20-something. They battle Mother Nature, escalating rents, oil spills, resort developers and tough economic times. Yet they endure and, often, thrive.

And many of them do what they do so that they can skipout on sunny afternoons to catch a wave.

Life is truly a beach for the entrepreneurs who make their livings along the strands of Southern California’s storied coastline, from Santa Barbara’s palm-studded sands, through the long, skinny ribbon of Malibu, to the rough-and-tumble shores of Ocean Beach in San Diego.

Not for these business owners the ball and chain of a 9-to-5 desk job, even if laboring near the sea means having at best a flimsy financial safety net.

“I would not give up this industry, this lifestyle, for all the security in the world,” says blonde, tanned Terry Merrick, who with her husband, Al, operates Channel Islands Surfboards on State Street in Santa Barbara. Her attitude, firmly in place the last 20 years, is typical.

How many millions of dollars or thousands of jobs sift through the Southland’s myriad coastal restaurants, inns, art galleries, bookstores, arcades, souvenir emporiums, sunglass and T-shirt stalls, skate rental booths, bikini places and surf shops?

Jack A. Kyser, chief economist with the Economic Development Corp. of Los Angeles County, estimates that something just under $1 billion a year is spent by beach-goers in the Los Angeles area alone. He also notes that a good portion of waterfront commerce is conducted “underground” and therefore goes uncounted.

Clearly, many Californians benefit mightily from this seaside commerce when economic and atmospheric conditions are good--and suffer proportionately when the climate is not so hot, as in the case of this unseasonably cool, gloomy, recessionary season.

Indeed, cloudy weather of all sorts seems to be keeping the sun from breaking through for beachfront entrepreneurs.

Merchants in Huntington Beach, for example, endured weeks of down time last year after the American Trader oil spill closed beaches. Businesses in Santa Monica and Malibu are hurt by frequent closures for sewage leaks and other pollution.

In Santa Barbara, State Street stores and restaurants hung by a thread during three years of Caltrans construction as the city’s main shopping street was routed under a new U.S. 101 underpass to eliminate a string of anachronistic stoplights. That was on top of the devastating 1990 fire, the drought, the recession and war.

At Los Angeles County beaches, attendance peaked in 1983, when 79 million people took to the sands. By last year, the number had shrunk to 56 million, as people turned to other diversions, worried about water pollution, grew wary of too much sun or balked at higher parking fees, said Jinx Wible, secretary to the chief lifeguard for the Los Angeles County Beaches and Harbors Department.

Yet, she added, “there are just as many shops as always.”

Between Point Conception and the Mexican border stretch 300 miles of coastline, 35 state beaches, 65 county and city beaches and 22 public piers (many of them under repair because of storm damage and poor maintenance). Along the way, a traveler encounters more than 30 seaside communities, a number of them--Summerland, Silver Strand and Dulah, for instance--no more than motes on the map.

To get a picture of what keeps the beach economy sailing along, a reporter spent a week cruising California 1, Interstate 5 and various coastal byways. What follows are the stories of business people who share the spunky spirit of Southern California’s coast.

Santa Barbara

Like swimmers caught in an undertow, some Santa Barbara merchants near the beach have had to battle to keep their heads above water.

Sales at the Channel Islands Surfboards shop are down about 24% from last year, despite a move closer to the beach on State Street to get out of Caltrans’ construction path.

“It all started with the fire,” co-owner Terry Merrick says of the June, 1990, blaze that destroyed nearly 600 houses and caused $500 million in damage. “The whole city was in mourning.

“Then the city came along and closed the street from both ends. They tore up the street two weeks before Christmas and left us with dirt clods for eight months. The sidewalk was jackhammered clear up to the doors.”

The construction and general economic downturn also pounded the Merricks’ retail business, which until last year had been steadily climbing.

What helped keep Channel Islands’ retail business going, she said, was the reputation of her husband Al’s surfboards, used by such hot shots as Kelly Slater and three-time world champ Tom Curren. Sales of the boards, made a block away from the shop, continue to grow apace.

Al Merrick began surfing at age 10 in Encinitas. Later, as a boat builder in Santa Barbara, he borrowed money to buy a bolt of “cloth”--fiberglass, in surfer speak--and resin to make his own surfboards. He began shaping them in a garage in 1968 and went into the manufacturing business in 1972.

At 47, he still shapes boards and surfs almost every day. He and four employees produce 4,000 boards a year. “I can’t make enough,” he says.

Surfing, Merrick adds with pleasure, “is part of my job.”

Zuma Beach

“Malibu,” the sign says, “27 Miles of Scenic Beauty.”

Planning consultant Madelyn Glickfeld, a Malibu resident and one of 12 members of the California Coastal Commission, couldn’t agree more. “The entire economy of Malibu lives and dies with the sun,” she says

Increasingly, though, Malibu and its fabled beaches are becoming miles and miles of minimalls. Many sit vacant or nearly so, after being put up hurriedly in advance of Malibu’s conversion to cityhood last March, an action taken to control what many residents viewed as a frightening pace of development.

Where Pacific Coast Highway rounds the bend at Zuma Beach, the troubled economy and other circumstances claimed a victim in Beach Asylum, a short-lived surf wear shop that had been the pioneer tenant in a new two-story shopping plaza.

The owner, Sherry Satriano, said the store’s failure--on the day the Persian Gulf War started in January--put her heavily in debt and “pretty much devastated me.” Restrictions imposed by the landlords made it difficult to advertise, she said, and parking--as at many beach locations--was inadequate.

Satriano, who used to surf years ago at Little Dume and had run a successful store for 11 years elsewhere in Malibu, is now working as a nanny and has no plans to get back into a beach business. “I’m about to be a grandmother,” she said. “It wouldn’t be appropriate.”

Other businesses are likely to follow in Beach Asylum’s wake. Rex Levi, a commercial property consultant, said this summer of bad beach days has been tough on coastal merchants. “The summer months are typically what save business through the winter,” he said.

Venice Beach

“This is my booth,” 63-year-old Hwan Song said proudly, offering a visitor a chair in his cramped quarters on the Venice boardwalk.

From this makeshift, 400-square-foot emporium, Song for five years has peddled Ray Ban sunglasses, costume jewelry, combs, belts, woven handbags and suntan lotion. He competes with dozens of other vendors--many of them immigrants like himself--who ply their wares all in a row along Southern California’s most colorful beachfront thoroughfare. They pay thousands of dollars a month--some of the steepest retail rents around.

“We work 365 days if it’s not raining, 8 or 9 a.m. to dusk,” said Song, an immigrant from Seoul who, unlike many of the immigrant booth workers, speaks nearly flawless English. “The rainy days are the only time we rest.”

The commute from Buena Park can take two hours. Is there no leisure time? he is asked. Overcome with what seems to be long-denied emotion, Song bows his head and softly begins to weep. Is it a hard life? “Yeah,” he whispers.

Years ago, Song managed construction jobs for Cummins Engine in Columbus, Ind. But after six years, he said, a “new boss came, and he had kind of a prejudice against Asians.” So Song brought the family west in 1980.

Since then, he and his wife, Okhui, have made enough to buy a house and see three children through UC Berkeley. Their son, Insop, is studying business there.

During the recession, Song said, sales have plunged 35%. The gloomy July didn’t help matters.

He pointed to a bruise on one ear and some scratches on his head, injuries sustained after he pursued three shoplifters who had made off with some sunglasses. He is a member of the Venice Action Committee, a community group concerned with crime and other issues.

Song hopes to become an exporter. “I speak Japanese like a native, Korean, Chinese and English,” he said. “And recently I started learning Spanish.”

Hermosa Beach

Harold Cohen’s mood was foul, like the late-morning weather in Hermosa Beach.

“Today I got a ticket for too much signage,” sighed the tanned, 39-year-old owner of La Playita, a small eatery half a block from the sand on 14th Street. “I have to go appear in court Sept. 17.”

He pointed to the attractive mint green lettering on the side of his hacienda-pink building. La Playita Mexican Cafe, it read, above a mural of a sunset and a palm tree. The city complained that it took up more than the allowable space.

For Cohen, it was just one more bureaucratic straw. Months ago, after six years of battles with city officials and a developer, the former La Playita was demolished to make way for a new beachfront hotel.

By that time, Cohen said, the restaurant, which he bought with borrowed funds in 1980, had become a “very profitable landmark, with people coming in from all over the world. It was unique, right on the beach, casual.”

He moved into the new location down the street with just 22 seats, down from 100 at the old spot. The staff has shrunk by 75%, to four, and receipts have likewise been reduced. Said Cohen: “We’re not making any money, we’re breaking even.”

Although Cohen maintains that he is not bitter about losing the hotel fight, he said he is “environmentally against” construction of the new hotel: “I’ve been in L.A. all my life. I’ve seen the changes. There’s no more open space.”

So there it sits, a gaping, fenced lot where developer David Greenwood hopes to build his 180-room Hermosa Hotel, if and when he secures the necessary permits and financing.

Cohen, who spent his teen-age summers surfing at Hermosa, doesn’t expect that to happen any time soon. Meanwhile, he’s planning to support an initiative this November aimed at turning the site into a park.

“Somewhere you have to make a stand and say enough’s enough,” Cohen said.

Huntington Beach

In “Surf City,” a.k.a. Huntington Beach, the newly redeveloping downtown is geared almost entirely to the beach crowd. Within an ultra-competitive one-mile radius, eight surf shops battle it out.

Down on the boardwalk near the pier--under reconstruction after being decimated in the storms of 1983 and 1988--Glenn Koshi takes a few moments out from a busy afternoon of renting skates and bikes.

“I don’t remember a summer this cold and gloomy,” says Koshi, who took over Paradise Beach Co. eight years ago at age 21 and recently had to lay off 20% of his small staff. “What’s keeping me alive right now is Rollerblade skates. We rent and sell them.”

Koshi and his partner ended up at the beach by chance after looking in vain for an inland shopping center location. Now he doesn’t want to leave.

The lifestyle has its stresses, though.

“We have to make a year’s worth of profit in four months,” he said. “It’s guesswork. And it’s true what they say. Owning your own business means working 16 hours for yourself instead of eight hours for someone else.”

Laguna Beach

Innkeeper Kevin A. Henry has spent his 27 years in Laguna Beach. And he’s distressed by the changes--notably the glut of T-shirt and yogurt shops and the bumper-to-bumper traffic that can make crawling through town a half-hour ordeal.

“It used to be a functioning, small, quaint town where locals could shop and find services. Now it’s almost all boutiques catering to tourists. It has almost become Newport Beach,” Henry said at his desk in Casa Laguna Inn.

“Which is, in fact, a fate worse than death,” chimed in his friend Catherine Watt.

Change is coming even to longtime landmarks along Laguna’s stretch of coastal highway.

In May, the Fahrenheit 451 book shop, a fixture since 1968, moved from its cottage to a new shopping plaza across the street. But the new digs are costing $8,000 a month, a ninefold increase.

“We’re still holding our breath,” said Dorothy (Dotti) Ibsen, a former TRW engineer who bought the store three years ago because she wanted to try something different. “It was a gutsy thing to do.”

Helping to offset some of the increase is a popular coffee and confections bar that Ibsen installed amid the bookcases. She also is sponsoring a series of performances by local artists that encourage passers-by to come in and sit a while. Since the move, she has noticed a big change in her clientele.

“In the old store during the summer, 80% were beach tourists,” she said. “Over here it’s 50% or a little less, and we’re seeing more people.”

The recession has taken its toll. But the coffee bar is a raging success. Says Ibsen: “I can’t wait to see what it’s like in a good economy.”

Ocean Beach

The neighborhood may be slightly seedy, with its “surfers, derelicts and old people,” as one business owner puts it. At least the rents are cheap, and there’s that super surf just a block away.

This beach in south San Diego is where Yvonne Cruz has held court at her custom wet suit shop for the last 13 years. For the 12 before that, she had worked at a semiconductor manufacturer in Orange County.

Overhead in her Surf ‘n Sea shop hangs a Cabbage Patch doll in a tiny wet suit next to samples of the brightly colored neoprene she uses to make suits for divers, surfers and swimmers. A sign on the front door reads: Yes, dogs, bare feet, swimsuits welcome.

These days, what with the recession, she has noticed her customers getting their old suits repaired rather than ordering new ones, which run about $235 for a full winter model. But she doesn’t see the surf business crashing.

“I have a lot of customers with kids learning to surf,” she said.

Across the street is the factory of another Ocean Beach entrepreneur, 25-year-old Julie Klein, who started making surfboard bags at home after Proposition 13 made it tough to find a job in her chosen field, public administration.

Her Julie Designs now sells board bags, duffel bags and Lycra surfer turtlenecks to 150 stores. When the surf business is slow, she makes jerseys for ski racers.

Klein keeps her prices modest and tries to outpace bigger rivals by being first with zippy new colors. “I’m not real trendy,” she said. “Even though the economy is bad, our sales are still strong. People will buy a bag to protect their board.”

She and Cruz are active in efforts to clean up Ocean Beach, lobbying against proposed new saloons and working on committees to aid the homeless.

As for Cruz, though she loves being near the beach, she has made a trade-off in income and lifestyle.

“I could make a lot more money back in industry,” she said. “I just don’t want to go back. I love it. Being at the beach gives me a strong sense of community. It’s a healthier lifestyle. And ultimately I’m the one responsible for my business.”

Times researcher Norma Kaufman in San Francisco contributed to this story.