Monday, February 15, 2010

Dreams

I've had a dream in the back of my mind for quite a while - move to a tiny town that's eager to revitalize its population and gain more businesses. Get a small business loan from an entity that's willing to take a chance on a woman-owned small business and purchase (or construct) a quaint building in the heart of town that has room for a business on the ground floor and living quarters above, with a small plot of land in the rear on which raised garden beds can be installed. Then, I'd open a bookstore/bistro/craft store. I'd offer both used and new books, CDs and DVDs (with a purchase and resell system in place), as well as a small bistro with homecooked eats (some of the produce used would come from my raised garden beds), and yarns, knitting books/needles, crochet and sewing supplies. I'd also have a consignment system in place for local producers to sell their crafts, canned goods, etc. I'd even look into having an online presence, if needed. In the afternoons and evenings, I'd have storytime for the school kids, book discussion groups, invite local residents to host classes on handcrafts and hobbies, host writing workshops, blogging basics, and the like. Ideally, this town would be far enough away from a big city that it's a hassle for the surrounding communities to drive all the way to the city when they want a book, movie or to socialize, but close enough that getting supplies wouldn't be an issue, either, and it would be possible for Jamie to continue with his violin lessons. And I'd love it to be in a place that gets cold enough to snow. Is this a silly dream that can just stay up on the shelf in my mind, or is it something I should pursue? What do you all think?

Update (2/16/10): Thanks for the comments and suggestions. One question, though. Do you all think this is a viable plan, or is this type of business pretty obsolete in this day of Internet bookstores, etsy accounts and "free shipping right to your door"? Is this type of business doomed to failure? Or would the draw of a place to congregate and socialize, as well as participate in commerce, in a relatively-isolated community be enough to keep the business going?

7 comments:

Suze said...

I think owning a business is always more work than it sounds like. But then, so is single motherhood and you have handled that with aplumb! I know squat about running a business but I say if you have a good plan, you should go for it.

Jessi said...

It sounds wonderful!

Mrs. Allroro said...

pursue!

Strangeite said...

Since I have in the past started a new business and now am currently running another, I might be able to offer a little advise.

First, Susan is right that running a business is harder than most people assume. Very rarely will you make more money in the first few years than you would have made working for someone else.

I don't say that to discourage you though. Quite the opposite. The first thing you should do in order to take this idea from the realm of daydreaming to reality is by writing a business plan. I am sure that your local library has books on writing business plans and most cities have some kind of small business development center, where you can take free classes on developing a business plan.

Strangeite said...

Short answer is that yes, it is a viable idea.

Brief answer is that it depends. There are several factors that would contribute greatly to the success or failure of such a business. Location, location and location, would be the biggest determining factor. Second is the amount of capital you would have at your disposal. Besides just paying for the real estate, utilities, inventory, insurance, equipment, etc., you have to consider paying yourself. It isn't quite as simple as writing yourself a paycheck. You have to consider the fact that you no longer would have employer based insurance but have to purchase it on the open market.

Unless you operate the business without any employees, you also would have to worry about payroll, payroll taxes, worker's compensation insurance, etc.

Last but not least, is the fact that restaurants and retail stores are two business categories that have the lowest profit margins. I once helped a friend write a business plan for a restaurant and discovered that a very successful restaurant has a profit margin of about 3%.

None of these are impossible hurdles, but they aren't to be taken lightly either.

Writing your business plan is the best way to see how feasible your idea is.

Suze said...

Well I always have something to say, so even if business is the farthest thing from my expertise, I'm going to weigh in. I think when it comes to competing with the internet, think hard about what you could offer that isn't online. Used books and CDs, for example, most likely wouldn't be worth the trouble. But craft supplies that people like to see and touch in person before buying (not that those things aren't available online) might be a different story, especially if you are offering classes or some other community service as part of the deal. I went to the neatest store in a tiny town in SW Wisconsin (like, there wasn't even a stoplight, just a couple of stop signs) and they sold all kinds of eclectic stuff, including local crafts, local art, locally made yarn, random used stuff (not clothes, except for more unusual vintage items) and even used books and had a small section of organic groceries. They have a website: http://www.rivervalleytrading.com/
Who knows? It might give you some ideas.

Anonymous said...

As others said, it's harder than it looks. And location is the most important factor.

I'd think it may be hard to do what you're wanting in a small town (or perhaps I'm thinking smaller than you).

However, I could also see adding in another factor---say, niiice laundromat with wifi... on a college campus, and in my head, this suddenly blooms into something very very cool.