What do you wish you had known when you started your own business?
May 13, 2016 7:16 AM   Subscribe

I am starting a business, a hybrid retail/studio/community space. I have a lot of experience in running and developing all three of those concepts but I've never owned a business of my own before. If you started a business, what do you wish you had known? What would your advice be now?
posted by Marinara to Work & Money (12 answers total) 17 users marked this as a favorite
When my husband was starting a small business, he found a consultant through-- as I recall-- the local chapter of AARP partnered with the Small Business Administration. AARP not because he was retirement age but because they were offering free consulting by retired business owners. He wound up changing his business model based on comments they made about the poor foot traffic in that area. The location was still not ideal for the business he had, but with that awareness he was able to make it work. Honestly I wouldn't have done it the way he did; he had to work so hard that he was never properly compensated in my opinion. This was a business where you couldn't have much of an online aspect, which would have helped.

So, location and making sure you can be compensated for your work earlier rather than later. And find a consultant if you have any doubts about these. And explore options for online sales.
posted by BibiRose at 7:32 AM on May 13, 2016 [1 favorite]

Our community space failed because we thought a higher percentage of "very interested" people would actually do what they claimed to want to do. We were later told we should have counted on about 10-15% follow-through from people who seemed guaranteed to participate/contribute.
posted by michaelh at 8:07 AM on May 13, 2016 [3 favorites]

Set aside the money you need for taxes and DO NOT TOUCH IT for anything else. Not following this advice is what led my brother to bankruptcy and debt that he is still paying back, years after his business folded.
posted by xingcat at 8:07 AM on May 13, 2016 [7 favorites]

Work with an accountant when incorporating. My job involves cleaning up a lot of messes when people just decide to do the incorporating DIY because a podcast commercial said it's so easy and then they make a mess out of it and pay us $$$ to fix it.
posted by griphus at 8:12 AM on May 13, 2016 [3 favorites]

Work/life balance will be much harder to maintain. When you own & run your own business, the buck stops with you. If you don't do something, you don't have anybody to pull you up for not doing it. Time-off is going to be scarce in the first couple of years unless you put a system in place before you even launch. Be prepared for very long hours and needing to be on the ball constantly.
posted by kariebookish at 8:25 AM on May 13, 2016 [1 favorite]

I am surrounded by community space companies. Highly recommend you really do your homework, and decide if you are there to be a consultant provider or a landlord. Most pretend to be the former and then are mainly the latter, it has devastated the market.
posted by parmanparman at 8:42 AM on May 13, 2016 [1 favorite]

Seconding griphus' thoughts on the role your accountant/bookkeeper will play and finding someone who you have reason to trust and who seems to want your business. I had a family business with the accountant we had been using for some time who was . . . not someone i would have picked/continued to retain (this is not an issue for me any longer but you should definitely invest in this relationship).
posted by Exceptional_Hubris at 9:16 AM on May 13, 2016

When we received the cease and desist letter from a shop more than 2 hours away with the same name citing trademark infringement, we wish we had paid the $500 to have a trademark lawyer do the a name search for us.
posted by humboldt32 at 9:59 AM on May 13, 2016 [1 favorite]

2. Do you have a realistic plan to make enough money to pay salaries even if you aren't working? If you don't, then you are just buying yourself a really low-paying job.
3. You should have guaranteed money coming in; grants, rental contracts, something
4. If people tell you you are under-capitalized, don't start the business. (this is something I learned painfully)
posted by flimflam at 10:19 AM on May 13, 2016

Our community space failed because we thought a higher percentage of "very interested" people would actually do what they claimed to want to do. We were later told we should have counted on about 10-15% follow-through from people who seemed guaranteed to participate/contribute.

Seconding this -- in fact, the number may be even lower than 10%. I make a physical product, and when I announced it on various forums, the feedback was tremendous. Hundreds of people were saying, "take my money!" When it came time to actually take their money, though, only a handful followed through.
posted by bradf at 11:35 AM on May 13, 2016 [2 favorites]

A good accountant can save your neck.

Same for a good lawyer.

NEVER fall behind on your taxes. Payroll, Sales and Income Tax problems can kill a business faster than a lack of customers.

Spend time and effort in the hiring process. Call references and do a background check. With everyone! The handsome young man with the great resume may just be a hustler and con man. The scruffy kid with the tattoos may have left the Army with a Silver Star.

Take advantage of every resource you can. Get advice. Listen to it. You are not always the smartest person in the room. (But sometimes you are - develop a feel for when you are right.)
posted by Colonel Sun at 12:02 PM on May 13, 2016 [1 favorite]

Having owned a successful boutique in San Francisco, and being the sole person running things, I learned the following:

-You will be working a minimum of 70-80 hours a week if you're lucky
-Interns saved my ass. If you run a recording studio, haul in some students from the best local university who are interested in learning about running a studio. Talk to the music department head, they will help you.
-Retail is a crapshoot unless you're in a high foot-traffic retail area or have such a specialized product that people really really want that they are willing to travel to get in person (this is rare, and takes years to build to that point regardless)
-People buy far more things online these days. Don't kid yourself. Have an online store too.
-Online marketing is the heart and soul of your promotional life. If you aren't a whiz at this, hire someone who is, and make sure they know how to take really really good photographs
-it's a full time job to maintain a full spectrum media presence with an online store + blog + newsletters + instagram + pinterest + twitter + facebook, yes you need all of those.
-networking at events that your customer base hangs out at is also critical. try to get a vending booth, or doll up 5 of your best looking friends and give them business cards or fliers to hand out
-if you don't know how to design nice, professional promotional materials (including signs in your store, your website, newsletters, etc) again, hire someone who does
- it might take a few years before things really take off. be patient. make sure you can afford to do that.
-don't try to do your taxes yourself. talk to an accountant beforehand to get an idea of how you should be categorizing and tracking your expenses

Best of luck!
posted by ananci at 10:06 AM on May 14, 2016 [2 favorites]

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