Free daily tips, information and advice for people in small business
from someone who has been there, done that in several small operations.
Small restaurants and cafes can go through difficult times. They are among the first businesses to feel the pinch of bad economic times.
They can become neighborhood gathering places and this can be the bedrock on which these operations grow and expand. People return again and again because they know what to expect. Customers usually settle on a few items from the menu and they re-order frequently these favorites.
Kick-starting small restaurants and cafes to the next level takes some careful planning. You don't want to mess with what success there you have, but you need more business.
Example: Bob decided to add music. He made contact with a local Irish group and found that several members played traditional Irish musical instruments--they even got together occasionally to practice. A place to practice was a problem for the group. Bob offered them exposure at his modest restaurant on Sunday afternoons--no payment was involved. Soon, the word spread and a full house of customers arrived--not only on Sunday afternoons, but on other days as well.
To expand your customer base, think outside the box. Sometimes, by solving someone else's problem, you solve your own.
Example: Jackie took an approach that involved her love of different cuisines. Her cafe sat less than 50 people. She was busy at breakfast and lunch, but there was little dinner traffic. She decided to add an International Night on Thursdays, thinking that it would attract more attention. The first week she offered a Jamaican Holiday meal, followed the second week with Casablanca Night. By the third week, every seat in the house was filled with diners clamoring for more of the Tex-Mex Specials.
Every idea you try might not work. And what works for one business might not work in another. But you never give up.
Example: Frank wanted to expand his restaurant business to become the "go-to" place for parties and gatherings. He began putting out the word--to organizations, companies, and groups. Everyone, it seemed, needed a space for small gatherings. And Frank could serve up food and drink from the restaurant side. He redid the decor, and his restaurant business became the caterer for the events that took place. As word spread, people wanted to hold other events at Frank's--private parties, birthdays, retirements, reunions and the like. He's thinking of franchising the concept, and he has already expanded with a second location.
You never know where an idea for change will lead you. But you stay on top of your game by testing every idea that holds promise.
Questions? I retired when I turned 75 and keep active with writing and coaching. You can email me at AlWarr16@gmail.com with your questions--put BLOG in the subject line so I don't delete. Quick answers from my 40+ years experience founding and growing small businesses. Your privacy is always respected.
Friday, May 30, 2014
Thursday, May 29, 2014
Expanding hairdressers
Free daily tips, information and advice for people in small businesses
from someone who has been there, done that in several small operations.
In yesterday's world, many hairdressers started their business working at a single station. The small operation served the neighborhood, and the owner of the shop did all the work.
Such places still exist, but they are relatively rare. More commonly, today's hairdressers are salons. And the services offered cover much more than hair.
Example: Mary began "doing hair" more than 30 years ago. Today, she has a six-station salon. The specialty is color and cut. Over the years she expanded with the times, carefully adding employees--no freelancers here. She sends her people to training sessions to keep up with the latest fashions and trends in styling and color. Not only do women drive considerable distances to her shop, but she is seeing an increasing number of men.
This example is fairly typical of expansions in the hairdressing business. A business must keep up with the changing times, or it will be left with a smaller and smaller customer base.
Example: Janet also began as a single-operator hairdresser. Over several years, she successfully transformed her operation into a full-fledged spa. Both women and men come to her spa today. Customers can select from a menu, from an hour long refresher to a full day of total transformation. Hair is cut, skin is cleaned, nails are trimmed, bodies are massaged and waxed, and a nutritionist is on hand to counsel clients. Beginning as a single-station operation, Janet today employs more than two dozen specialists--and the referrals keep the appointment desk buzzing.
The decision to expand a hairdressing operation into a full-fledged spa takes lots of determination, space, funding, and a careful business plan. Clearly, spa services can include many different possibilities, and the appeal is to an up-scale clientele.
Example: John went through professional training and spent several years in a New York salon. His ambition was to become the hairdresser to male and female movie stars, politicians, CEOs and business magnates. During all those years of training and experience, John was building up his list of contacts and networking his way to many more. When he decided the time was right, he quit his position at the New York salon. His cell phone became his business office as he made calls to prospective clients. With a pocketful of appointments, he regularly boards a flight to meet the client--whenever and wherever. He does not have a bricks-and-mortar location, nor does he need one.
Many avenues can open up for expanding a hairdressing business. These three examples are from people I have worked with--names changed, of course.
All sorts of possibilities and opportunities are out there. It's a matter of deciding where you want to take your talents. And doing your business plan.
Questions? I retired when I turned 75--these days, I write and coach. You can email me at AlWarr16@gmail.com with specific questions--put BLOG in the subject line so I don't delete. Quick answers from my 40+ years experience founding and operating small businesses. Your privacy is always respected.
from someone who has been there, done that in several small operations.
In yesterday's world, many hairdressers started their business working at a single station. The small operation served the neighborhood, and the owner of the shop did all the work.
Such places still exist, but they are relatively rare. More commonly, today's hairdressers are salons. And the services offered cover much more than hair.
Example: Mary began "doing hair" more than 30 years ago. Today, she has a six-station salon. The specialty is color and cut. Over the years she expanded with the times, carefully adding employees--no freelancers here. She sends her people to training sessions to keep up with the latest fashions and trends in styling and color. Not only do women drive considerable distances to her shop, but she is seeing an increasing number of men.
This example is fairly typical of expansions in the hairdressing business. A business must keep up with the changing times, or it will be left with a smaller and smaller customer base.
Example: Janet also began as a single-operator hairdresser. Over several years, she successfully transformed her operation into a full-fledged spa. Both women and men come to her spa today. Customers can select from a menu, from an hour long refresher to a full day of total transformation. Hair is cut, skin is cleaned, nails are trimmed, bodies are massaged and waxed, and a nutritionist is on hand to counsel clients. Beginning as a single-station operation, Janet today employs more than two dozen specialists--and the referrals keep the appointment desk buzzing.
The decision to expand a hairdressing operation into a full-fledged spa takes lots of determination, space, funding, and a careful business plan. Clearly, spa services can include many different possibilities, and the appeal is to an up-scale clientele.
Example: John went through professional training and spent several years in a New York salon. His ambition was to become the hairdresser to male and female movie stars, politicians, CEOs and business magnates. During all those years of training and experience, John was building up his list of contacts and networking his way to many more. When he decided the time was right, he quit his position at the New York salon. His cell phone became his business office as he made calls to prospective clients. With a pocketful of appointments, he regularly boards a flight to meet the client--whenever and wherever. He does not have a bricks-and-mortar location, nor does he need one.
Many avenues can open up for expanding a hairdressing business. These three examples are from people I have worked with--names changed, of course.
All sorts of possibilities and opportunities are out there. It's a matter of deciding where you want to take your talents. And doing your business plan.
Questions? I retired when I turned 75--these days, I write and coach. You can email me at AlWarr16@gmail.com with specific questions--put BLOG in the subject line so I don't delete. Quick answers from my 40+ years experience founding and operating small businesses. Your privacy is always respected.
Wednesday, May 28, 2014
Farm businesses
Free daily tips, information and advice for people in small business
from someone who has been there, done that in several small operations.
People are very concerned about the foods they eat. We are encouraged to "eat healthy" and "eat fresh" every day.
Roadside farm stands are common. Farm markets are popular. Organic farming and all natural production methods enjoy rising acceptance.
Some of this is a reaction to big agriculture. Large corporations long ago discovered they could make a buck raising grains, veggies, fruits, and meat animals. The problem is, they have taken big production a step too far--frequently ignoring taste, nutrition and the utter joy found in a vine-ripened tomato.
Increasingly, people are moving away from big agriculture. It has its place, but "not on my table" seems to be the siren song attracting people back to small farms.
Supermarkets advertise freshness and establish an organic veggie section. Chefs attract people with fresh inputs, grown locally. And farms are eagerly supplying the herbs, veggies, fruits, berries and meats.
Example: Working full time, a lady had little time to tend the garden behind her house. She had a few roses, some bulbs, peonies, and a patch of lawn. She cut the grass herself with a manual mower, and everything else took care of itself. One day she had an idea. First she got rid of the grass. Then she had two raised beds built, each 4 feet wide and 20 feet long. Today, she plants more than a dozen types of lettuce in the beds. With successive plantings throughout the season, she harvests and sells to restaurants. She emails availability to chefs, and they email orders. She left her corporate position and is now a full time farmer.
Example: A small farmer grew tired of the government price support program for the corn he grew. He had four small fields, and he rented additional land--just to make ends meet. He figured he could do better. The following spring, he planted corn in all his fields except one--this began his transition. In the smallest field, he planted about 3 acres of strawberries. The following year, in another field, he planted raspberries. Today, he no longer plants any corn--except the sweet corn which he sells in his farm stand. All the berries are offered to the public in a pick-your-own operation, and he sells at farm markets as well as at his own farm stand. Chefs love the fresh berries. Any left overs from these marketing endeavors are made into sugarless preserves. He's making more money and enjoying it more.
Example: A teenager converted his grandmother's greenhouse into a farming operation. Here the teen grows a wide variety of herbs for the local markets. He is experimenting with different types of eggplant. He tends the operation before and after school, and he is putting away savings to expand or go to college.
Example: A few chickens in the backyard led Jennifer to establish her current small business. She raises free range, all natural chickens for the eggs and the meat. She sells at local markets and direct to the general public.
Farming is a business. All these examples show what can be done on a small scale. You must adjust your operation to the local needs or reach out beyond your area. Small operations grow bigger all the time--it's all a matter or your ingenuity and sweat.
Questions? I retired when I turned 75. You can email me your questions at AlWarr16@gmail.com and put BLOG in the subject line (so I don't delete). Quick answers from my 40+ years experience founding and growing small businesses. Your privacy is always respected.
from someone who has been there, done that in several small operations.
People are very concerned about the foods they eat. We are encouraged to "eat healthy" and "eat fresh" every day.
Roadside farm stands are common. Farm markets are popular. Organic farming and all natural production methods enjoy rising acceptance.
Some of this is a reaction to big agriculture. Large corporations long ago discovered they could make a buck raising grains, veggies, fruits, and meat animals. The problem is, they have taken big production a step too far--frequently ignoring taste, nutrition and the utter joy found in a vine-ripened tomato.
Increasingly, people are moving away from big agriculture. It has its place, but "not on my table" seems to be the siren song attracting people back to small farms.
Supermarkets advertise freshness and establish an organic veggie section. Chefs attract people with fresh inputs, grown locally. And farms are eagerly supplying the herbs, veggies, fruits, berries and meats.
Example: Working full time, a lady had little time to tend the garden behind her house. She had a few roses, some bulbs, peonies, and a patch of lawn. She cut the grass herself with a manual mower, and everything else took care of itself. One day she had an idea. First she got rid of the grass. Then she had two raised beds built, each 4 feet wide and 20 feet long. Today, she plants more than a dozen types of lettuce in the beds. With successive plantings throughout the season, she harvests and sells to restaurants. She emails availability to chefs, and they email orders. She left her corporate position and is now a full time farmer.
Example: A small farmer grew tired of the government price support program for the corn he grew. He had four small fields, and he rented additional land--just to make ends meet. He figured he could do better. The following spring, he planted corn in all his fields except one--this began his transition. In the smallest field, he planted about 3 acres of strawberries. The following year, in another field, he planted raspberries. Today, he no longer plants any corn--except the sweet corn which he sells in his farm stand. All the berries are offered to the public in a pick-your-own operation, and he sells at farm markets as well as at his own farm stand. Chefs love the fresh berries. Any left overs from these marketing endeavors are made into sugarless preserves. He's making more money and enjoying it more.
Example: A teenager converted his grandmother's greenhouse into a farming operation. Here the teen grows a wide variety of herbs for the local markets. He is experimenting with different types of eggplant. He tends the operation before and after school, and he is putting away savings to expand or go to college.
Example: A few chickens in the backyard led Jennifer to establish her current small business. She raises free range, all natural chickens for the eggs and the meat. She sells at local markets and direct to the general public.
Farming is a business. All these examples show what can be done on a small scale. You must adjust your operation to the local needs or reach out beyond your area. Small operations grow bigger all the time--it's all a matter or your ingenuity and sweat.
Questions? I retired when I turned 75. You can email me your questions at AlWarr16@gmail.com and put BLOG in the subject line (so I don't delete). Quick answers from my 40+ years experience founding and growing small businesses. Your privacy is always respected.
Tuesday, May 27, 2014
Expanding your business
Free daily tips, information and advice for people in small business
from someone who has been there, done that in several small operations.
If sales are down in your business, you look for answers. It might be the economy in general. It might be the weather or the seasonal changes. It might be you need a new sales person.
Or it might be that you are in the wrong business. Not wrong, but maybe in the wrong segment of the business.
It might be time to expand into another area of the on-going business. Begin to offer additional services or product lines.
Example: A small independent web designer expands his business considerably by offering on-site services to customers. Services at their site, not his. Previously, he did web design for other small businesses. His new customers are larger--15 to 50 employees. Now he helps them set up networks, troubleshoots systems, offers maintenance contracts, and holds training sessions. He just bought a new car.
This shows how you might be missing opportunities to do more for more people. Your customers now have needs that are related to what you do. Right now they are calling other businesses to satisfy those needs. Think through your own talents and experience, looking for ways to expand your operation.
Service businesses are almost always easy to expand. You might have already tried several approaches. Keep trying. Keep looking. And remember--what you tried and discarded in the past might just fill the bill tomorrow (it can take the world a while to catch up with you).
Example: A struggling frame shop expands by offering local artists a place to show their works--paintings, photographs, sculptures. It's the backdoor approach to establishing a gallery or high end gift shop. But the change does not stop there. The frame shop owner now reaches out to banks and large companies in the area, offering to rent artworks for display in their offices, hallways, lobbies, etc. This is not easy to set up (think insurance, security, deliveries), but it can all work together. And it expands considerably the reputation of the frame shop.
Build on what you have when thinking of expanding. Keep the core, and look for ways to enlarge it. A way is always there to nudge your operation in one direction or another, expanding your business in the process.
Questions? I retired when I turned 75. You can email me at AlWarr16@gmail.com with your questions. Put BLOG in the subject line so I don't delete. Quick answers from my 40+ years experience founding and growing small businesses. Your privacy is always respected.
from someone who has been there, done that in several small operations.
If sales are down in your business, you look for answers. It might be the economy in general. It might be the weather or the seasonal changes. It might be you need a new sales person.
Or it might be that you are in the wrong business. Not wrong, but maybe in the wrong segment of the business.
It might be time to expand into another area of the on-going business. Begin to offer additional services or product lines.
Example: A small independent web designer expands his business considerably by offering on-site services to customers. Services at their site, not his. Previously, he did web design for other small businesses. His new customers are larger--15 to 50 employees. Now he helps them set up networks, troubleshoots systems, offers maintenance contracts, and holds training sessions. He just bought a new car.
This shows how you might be missing opportunities to do more for more people. Your customers now have needs that are related to what you do. Right now they are calling other businesses to satisfy those needs. Think through your own talents and experience, looking for ways to expand your operation.
Service businesses are almost always easy to expand. You might have already tried several approaches. Keep trying. Keep looking. And remember--what you tried and discarded in the past might just fill the bill tomorrow (it can take the world a while to catch up with you).
Example: A struggling frame shop expands by offering local artists a place to show their works--paintings, photographs, sculptures. It's the backdoor approach to establishing a gallery or high end gift shop. But the change does not stop there. The frame shop owner now reaches out to banks and large companies in the area, offering to rent artworks for display in their offices, hallways, lobbies, etc. This is not easy to set up (think insurance, security, deliveries), but it can all work together. And it expands considerably the reputation of the frame shop.
Build on what you have when thinking of expanding. Keep the core, and look for ways to enlarge it. A way is always there to nudge your operation in one direction or another, expanding your business in the process.
Questions? I retired when I turned 75. You can email me at AlWarr16@gmail.com with your questions. Put BLOG in the subject line so I don't delete. Quick answers from my 40+ years experience founding and growing small businesses. Your privacy is always respected.
Monday, May 26, 2014
Planning basics
Free daily tips, information and advice for people in small business
from someone who has been there, done that in several small operations.
Talking about planning comes naturally to me. I tend to concentrate on where am I headed and what things do I need to do today to clear the pathway there.
I was lucky in that regard. Since I was very young, it has never bothered me to put the past in its place and move on. As long as I kept my eye on the future, the present fell into place--and the past really didn't matter that much.
Don't misunderstand. The past is important. It teaches us valuable lessons. Good and bad avenues have been traveled by all of us--and we owe it to ourselves to learn from both.
But business planning is all about the future. And nothing in the future of your business is more important than the marketing aspects.
Marketing: Your customers determine your future. That outrageously complex computer game you devised will not turn into a business if no one buys it. That new beer you brewed and lovingly bottled will stay stacked away in the back room if no one buys it.
You can find outlines of business plans on the Internet, along with lots of information on the process of business planning. Most of it is written by good writers with good intentions. But, reading between the lines, you can tell they haven't been there, done that.
I recommend starting the planning process with the most important aspect--and that is marketing. Like the good witch says in the Wizard of Oz, the place to start is at the beginning. And the beginning of your business planning is with marketing.
Who are your customers? How to you find them? Is their need a continuing one that you can supply? How will you expand the customer base in the future? Have you accounted for the changes that future technology will impose on your business? Is marketing (and selling) one of your strengths? If not, how do you plan to compensate?
The answers to these questions will help you through the daily grind. The answers also provide the basis for the most important part of your business plan. You can carry it around in your head, or you can write it down--preparing it as a formal document accompanying a request for a loan.
Other aspects: The heart of business planning is marketing. But a formal business plan must cover other aspects of you and your business.
These include long term goals (think at least 5 years into the future), purpose of the plan (for your own eyes? for an investor? for a bank?), background (what's the business history to date?), management background (what are your own strengths and weaknesses?), your products/services and production (what, actually, are you selling?), and finally, the numbers.
Reducing everything to numbers is like wringing the water out of a wet towel. Doing the numbers gets the crap out of your verbiage. Your history to date and your projections into the future--this is where the rubber meets the road.
The numbers give validity to all that you say in a written plan. This is where you convince someone else that they can believe in your marketing projections.
For more about planning, see past blogs--Planning Box, Funding Sources, Business Check-Up, and Daily Planning.
Questions? I retired when I turned 75. You can email me at AlWarr16@gmail.com with your questions. Put BLOG in the subject line so I don't delete. Quick answers from my 40+ years of experience founding and running small businesses. Your privacy is always respected.
from someone who has been there, done that in several small operations.
Talking about planning comes naturally to me. I tend to concentrate on where am I headed and what things do I need to do today to clear the pathway there.
I was lucky in that regard. Since I was very young, it has never bothered me to put the past in its place and move on. As long as I kept my eye on the future, the present fell into place--and the past really didn't matter that much.
Don't misunderstand. The past is important. It teaches us valuable lessons. Good and bad avenues have been traveled by all of us--and we owe it to ourselves to learn from both.
But business planning is all about the future. And nothing in the future of your business is more important than the marketing aspects.
Marketing: Your customers determine your future. That outrageously complex computer game you devised will not turn into a business if no one buys it. That new beer you brewed and lovingly bottled will stay stacked away in the back room if no one buys it.
You can find outlines of business plans on the Internet, along with lots of information on the process of business planning. Most of it is written by good writers with good intentions. But, reading between the lines, you can tell they haven't been there, done that.
I recommend starting the planning process with the most important aspect--and that is marketing. Like the good witch says in the Wizard of Oz, the place to start is at the beginning. And the beginning of your business planning is with marketing.
Who are your customers? How to you find them? Is their need a continuing one that you can supply? How will you expand the customer base in the future? Have you accounted for the changes that future technology will impose on your business? Is marketing (and selling) one of your strengths? If not, how do you plan to compensate?
The answers to these questions will help you through the daily grind. The answers also provide the basis for the most important part of your business plan. You can carry it around in your head, or you can write it down--preparing it as a formal document accompanying a request for a loan.
Other aspects: The heart of business planning is marketing. But a formal business plan must cover other aspects of you and your business.
These include long term goals (think at least 5 years into the future), purpose of the plan (for your own eyes? for an investor? for a bank?), background (what's the business history to date?), management background (what are your own strengths and weaknesses?), your products/services and production (what, actually, are you selling?), and finally, the numbers.
Reducing everything to numbers is like wringing the water out of a wet towel. Doing the numbers gets the crap out of your verbiage. Your history to date and your projections into the future--this is where the rubber meets the road.
The numbers give validity to all that you say in a written plan. This is where you convince someone else that they can believe in your marketing projections.
For more about planning, see past blogs--Planning Box, Funding Sources, Business Check-Up, and Daily Planning.
Questions? I retired when I turned 75. You can email me at AlWarr16@gmail.com with your questions. Put BLOG in the subject line so I don't delete. Quick answers from my 40+ years of experience founding and running small businesses. Your privacy is always respected.
Friday, May 23, 2014
Space cost, landlord
Free daily tips, information and advice for people in small business
from someone who has been there, done that in several small businesses.
The first time you lease space for your business, you can negotiate from strength. Toward the end of that first lease, you will be negotiating from weakness.
We are talking leasing space for small businesses here--not bigger companies. Big operations are slow to move, small operations are fleet of foot. What this means is critical to the process of renting space. Landlords know that small businesses can leave at the end of a lease with relative ease, whereas a bigger company finds it harder.
The aim of the small business in the first lease is to get the longest term at the lowest cost. Landlords typically throw in sweeteners upfront to entice you--they offer to fix the door, upgrade the restroom, maybe move an internal wall you don't want.
But keep your eye on low cost and long term. You can assume that the landlord will up the cost when you go to extend or renew the lease. You'll get your best deal upfront. When you go to extend your lease, the base line has already been set.
Before signing anything, now or later, you deserve to check out rents being charged elsewhere for comparable space. This can be difficult because other business owners are reluctant to divulge such information. Real estate agents have this information.
A chamber of commerce or other business organization in your area can be helpful in gathering this information. Also, check out other locations in other areas. You might run up on a better location at the same or lower cost than where you are.
Some landlords oversell themselves on the value of the space they have for rent. They begin to think that the town or neighborhood is on the rise economically, and they begin to lead the way by offering space at higher and higher rents. This thinking on their part can lead to their asking unreasonably high rents, losing tenants, and contributing to economic downturns locally.
Landlords might think that once you move your business into their space, you won't leave. Sometimes, it's true. Think about the costs of moving a spa with all that special plumbing. Think about a machine shop or a printing operation with all it's heavy equipment. On the other hand, law offices and accounting operations can pack up in a briefcase and move to another location.
Always try to make your lease coincide with your plans. Your business plan is very important here. A florist might be planning to expand into greenhouse operations in five years. Negotiating a five year lease on town space now can coincide with expansion into the greenhouse--at another location--in the same five years.
Also, if the space you're considering is larger than you need, try to negotiate for a smaller space with an "expansion" clause downstream in say, a year or two. Many landlords will not consider such a proposition, but in tight economies, they might. You can save a substantial amount of rental cost this way, and the landlord has a "sure thing" in the lease for renting you more space in the future. It can be a "win-win" situation.
See yesterday's blog, where size and location were covered.
Questions? I retired when I turned 75. Today I write and garden. You can email me your questions at AlWarr16@gmail.com. Put BLOG in the subject line so I don't delete. Quick answers from my 40+ years of personal experience in founding and running small operations. Your privacy is always respected.
from someone who has been there, done that in several small businesses.
The first time you lease space for your business, you can negotiate from strength. Toward the end of that first lease, you will be negotiating from weakness.
We are talking leasing space for small businesses here--not bigger companies. Big operations are slow to move, small operations are fleet of foot. What this means is critical to the process of renting space. Landlords know that small businesses can leave at the end of a lease with relative ease, whereas a bigger company finds it harder.
The aim of the small business in the first lease is to get the longest term at the lowest cost. Landlords typically throw in sweeteners upfront to entice you--they offer to fix the door, upgrade the restroom, maybe move an internal wall you don't want.
But keep your eye on low cost and long term. You can assume that the landlord will up the cost when you go to extend or renew the lease. You'll get your best deal upfront. When you go to extend your lease, the base line has already been set.
Before signing anything, now or later, you deserve to check out rents being charged elsewhere for comparable space. This can be difficult because other business owners are reluctant to divulge such information. Real estate agents have this information.
A chamber of commerce or other business organization in your area can be helpful in gathering this information. Also, check out other locations in other areas. You might run up on a better location at the same or lower cost than where you are.
Some landlords oversell themselves on the value of the space they have for rent. They begin to think that the town or neighborhood is on the rise economically, and they begin to lead the way by offering space at higher and higher rents. This thinking on their part can lead to their asking unreasonably high rents, losing tenants, and contributing to economic downturns locally.
Landlords might think that once you move your business into their space, you won't leave. Sometimes, it's true. Think about the costs of moving a spa with all that special plumbing. Think about a machine shop or a printing operation with all it's heavy equipment. On the other hand, law offices and accounting operations can pack up in a briefcase and move to another location.
Always try to make your lease coincide with your plans. Your business plan is very important here. A florist might be planning to expand into greenhouse operations in five years. Negotiating a five year lease on town space now can coincide with expansion into the greenhouse--at another location--in the same five years.
Also, if the space you're considering is larger than you need, try to negotiate for a smaller space with an "expansion" clause downstream in say, a year or two. Many landlords will not consider such a proposition, but in tight economies, they might. You can save a substantial amount of rental cost this way, and the landlord has a "sure thing" in the lease for renting you more space in the future. It can be a "win-win" situation.
See yesterday's blog, where size and location were covered.
Questions? I retired when I turned 75. Today I write and garden. You can email me your questions at AlWarr16@gmail.com. Put BLOG in the subject line so I don't delete. Quick answers from my 40+ years of personal experience in founding and running small operations. Your privacy is always respected.
Thursday, May 22, 2014
Space size, location
Free daily tips, information and advice for people in small business
from someone who has been there, done that in several small operations.
Renting the space you need for your small business can be nerve-wracking. Size, location, image, landlord, cost, length of lease are some of the worries.
Location: Some businesses can be run out of your garage. Others require a high-traffic location. Be honest with yourself when considering leasing space.
Consider locating your new or expanding sporting goods store in a country barn--once you get the word out, your customers will find you, and enjoy the ride in the country. A used car lot might benefit being located on a busy thoroughfare, but a travel agency can attract clients to a website operated out of your home office--most travel clients don't come to an office. A frozen yogurt stand can do well in a mall, but a shop that machines widgets can be just about anywhere.
Two things are of major importance when considering location--your business plan for the future, and pertinent zoning regulations. Is there a location impact in your plans? Is the location in a neighborhood in transition? Are there plans afoot to raze the building in 3 years? Talking with a local real estate professional might provide some answers.
Size: Some business owners walk into a prospective space, make an intuitive guesstimate about the size, and sign on the dotted line. A much more prudent approach is--again--look to your business plan.
If you are opening a restaurant, what's the number of tables you need to generate the income you've projected in your business plan? If you are performing accounting services for clients, how much space do you need working alone--and for those future employees you plan to hire?
The size of the space must be consistent with plans for the future. Can you grow your business here? Is the size big enough for growth but not so big that the growth will take 10 years? What are the "carrying costs" of leasing more space than you need now and "carrying" those costs as you expand to fill it?
Every business requires space--even a virtual business operated entirely on the Internet requires a place somewhere to operate. Translate your current/future business plans into a floor plan that will accommodate today and tomorrow.
In tomorrow's blog, I'll take up landlord, cost, and length of lease for space.
Questions? I retired when I turned 75. You can email me at AlWarr16@gmail.com with your questions. Put BLOG in the subject line so I don't delete. Quick answers from my 40+ years of experience founding and running small businesses. Your privacy is always respected.
from someone who has been there, done that in several small operations.
Renting the space you need for your small business can be nerve-wracking. Size, location, image, landlord, cost, length of lease are some of the worries.
Location: Some businesses can be run out of your garage. Others require a high-traffic location. Be honest with yourself when considering leasing space.
Consider locating your new or expanding sporting goods store in a country barn--once you get the word out, your customers will find you, and enjoy the ride in the country. A used car lot might benefit being located on a busy thoroughfare, but a travel agency can attract clients to a website operated out of your home office--most travel clients don't come to an office. A frozen yogurt stand can do well in a mall, but a shop that machines widgets can be just about anywhere.
Two things are of major importance when considering location--your business plan for the future, and pertinent zoning regulations. Is there a location impact in your plans? Is the location in a neighborhood in transition? Are there plans afoot to raze the building in 3 years? Talking with a local real estate professional might provide some answers.
Size: Some business owners walk into a prospective space, make an intuitive guesstimate about the size, and sign on the dotted line. A much more prudent approach is--again--look to your business plan.
If you are opening a restaurant, what's the number of tables you need to generate the income you've projected in your business plan? If you are performing accounting services for clients, how much space do you need working alone--and for those future employees you plan to hire?
The size of the space must be consistent with plans for the future. Can you grow your business here? Is the size big enough for growth but not so big that the growth will take 10 years? What are the "carrying costs" of leasing more space than you need now and "carrying" those costs as you expand to fill it?
Every business requires space--even a virtual business operated entirely on the Internet requires a place somewhere to operate. Translate your current/future business plans into a floor plan that will accommodate today and tomorrow.
In tomorrow's blog, I'll take up landlord, cost, and length of lease for space.
Questions? I retired when I turned 75. You can email me at AlWarr16@gmail.com with your questions. Put BLOG in the subject line so I don't delete. Quick answers from my 40+ years of experience founding and running small businesses. Your privacy is always respected.
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