Entrepreneurs cash in on Y2K paranoia
Monday, March 15, 1999
By Liz Garone
GETTING A LITTLE nervous about the Y2K bug?
Are you worried your credit cards won't work come Jan. 1, 2000? You could always buy $5,000 worth of coins housed in a World War II ammo case.
Scared that global financial chaos will cripple food production for months? Why not purchase a year's worth of dehydrated food for $1,200?
Paranoia over the Y2K problem is proving once again this economic truth: For every fear, no matter how outlandish, there is a product -- often at an even more outlandish price.
While a whole crop of computer consultants are dedicating themselves to solving the problem with new software, another less technology-minded crowd is focusing on the buzz surrounding Y2K.
The numbers these people care about are not related to zeros and double digits; they're preceded by dollar signs.
Some of the new wave of products have practical merit -- generators, coinage and dried foods, for example. Others -- like Y2K-compliant beer and bug spray -- have been created in pure jest.
In Burlingame, Y2K preparations come stacked in neat columns of shiny gold and silver coins.
Camino Coin Company offers a basic "Y2K Life Preserver" package for $4,295. The "super" version sells for a cool $5,300.
"A prudent person would get himself one of these collections," said Burt Blumert, owner of Camino Coin. "My prediction is that stores are going to be stripped of goods."
Included in the sets are British gold sovereigns, silver dollars, half-dollars, quarters and dimes. The basic set has a total face value of $560, the "super" set $600 -- but will be worth much more on the open post-Y2K market, according to Blumert.
Credit cards and checks may no longer be accepted, he said, and bartering and flea markets could once again become the standard.
The life preservers come packaged in WWII army ammunition cans and include solar, battery-free radios.
The company has set up a special 800-number hotline for Y2K orders. Blumert said that he has sold approximately 2,000 of the sets since he began marketing them two years ago -- and that coin sales, in general, have doubled in the last year.
It won't matter what kind of coins people have if the power goes out for an extended period of time, according to Bill Slade, manager of Bayside Equipment Company in Redwood City. Bayside sells generators for both home and business use.
December's blackout caused a surge in sales, some 30 percent, according to Slade.
The blackout was the equivalent of a training exercise, he said.
"People got scared, and the calls started coming in."
The 8,000-watt gas-powered generators are the most popular models, according to Slade. They cost about $6,000, including installation, and offer enough juice for a "modest-sized" home.
Francis LeBaron, who owns the Beehive Country Store in south San Jose, said that he has experienced a 500 percent increase in sales of water and other emergency supplies since August. He attributes much of it to Y2K.
"What we're talking about is a life insurance policy; you can cash it anytime you want to," he explained. "The other stuff we buy: car, home, health insurance, those are all death insurance policies."
LeBaron sells individual food storage units, which hold one year's worth of food for one person. The units are about the same size as a medium refrigerator and range in price from $1,200 to $2,000. LeBaron also sells 55-gallon barrels for water storage.
"It's like the Boy Scouts and Girl Scouts," said Linda Evans, who lives in the Sierra Foothills outside of Placerville. "Always be prepared."
Evans said that she has ordered a three-month supply of food and a couple of water-storage barrels from the Beehive.
"I'm not going crazy," she said. "I just don't want to take any chances."
San Jose resident Karl Reimer isn't taking any chances either.
"I'm doing this for my family's sake," said Reimer, who has already purchased a generator, barrels of water, extra batteries and flashlights, and a six-month food supply for a family of four.
Reimer, who is an engineer, said he expects to spend around $6,000 in preparation for Y2K. He's considering the purchase of a shotgun.
"If it really gets bad, we can always hunt for rabbits," he said.
The Beehive will be exhibiting at next month's Y2K Expo at the San Jose Convention Center.
More than 140 businesses are expected to participate in the event, according to trade show organizer Dan Torhjelm.
For some people, Y2K doesn't signal an end to the world economy or bring on visions of martial law -- just an opportunity to poke fun at people's paranoia.
"It suddenly hit me that this was a once-in-a-lifetime opportunity," said Dale Miller, a Sacramento-area building contractor-turned-purveyor of "Y2K Bug Spray."
Miller sells his "solution," as he calls it, for $4.95 on his Web site. Fry's Electronic in Palo Alto charges $3.95 for the 7-ounce bottle of air freshener in a fluorescent orange bug spray disguise.
"My goal this year is to make a million dollars off of it," said Miller, "and I think I just might do it."
So far, he has sold more than 10,000 units of the spray and has had orders from as far away as Germany.
If all else fails, there's always the option to toast Y2K, according to Marcos Quinones, general manager of the Tied House Cafe and Brewery in Mountain View.
"We know Y2K is what's being talked about," he said, "and we felt it important to Y2K-proof our beer."
The beer comes with its own Y2K compliance statement.
"Because beer is intended for human ingestion, it therefore does not maintain or require any internal or external date arithmetic, Boolian, calendar or date conversion routines during the brewing process," reads the statement on the brewery's Web site. "Tied House beer can be certified today as being Y2K ready because it was designed from the outset, and subsequently tested, to be drinkable both in the present and next century."
Quinones plans to release three new millennium-themed brews in time for the new year: Y2K Pale, MM Stout and Amber 2000.
At $3.25 a pint, the brews just may be the cheapest "fixes" around.
Anthony Bellante, shopping at Home Depot, said he cares more about mourning the passing of his childhood idol, Joe DiMaggio, than preparing for something that might not even happen.
"When you get to be my age, you worry about tomorrow," said the 74-year-old retired seafood broker from San Bruno, "not next year."
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