On our last post we discussed reason #3 in Michael Ames and Gustav Berle's 10 reasons for small business failure: Poor Location. In today's post we will discuss reason #1 on their list: Lack of Experience.
When we come up with a business idea, we usually envision ourselves as the sole owners of the project. We dread the idea of sharing our precious (future) creation. The problem with this approach is that it is extremely unrealistic to think that you will be an expert on everything that building your small business will entail. You may be the "idea" person, but do you hold all the other necessary skills? For instance, if your idea is a great concept for a restaurant, are you a chef that knows how to run a kitchen and design a menu?
Determine what you are bringing to the table and then determine what other areas are vital for that idea to become a reality. Are you well versed on the legal paperwork that you will need to register your company? Do you know anything about negotiating a lease? Do you feel competent requesting a business loan? Do you have the tools to complete and analyze a market research? Can you do your own branding? I could go on and on.
Being first time business owners, we lost many months trying to do things ourselves and even the few things we did well, still did not guarantee that we would be safe from error. The first thing we did right was get a broker to negotiate our lease. I still remember the first time I got that endless amount of paperwork. I was so overwhelmed. Once I got the lease with the broker's notes, I felt more at ease reading through with some guidance.
By mid summer we knew what the lease entailed, so we spoke to contractors. We needed to get a general idea of what the impact fee would be. The "impact fee" is the amount of money needed to turn an existing space into the proper space for the new business. This was tricky because we didn't have official plans yet. Getting plans from architects can cost several (5-10) thousands of dollars.
We decided to draw up a detailed floor plan ourselves and get a quote on that. Fast forward to today, after we have signed our lease, the contractors now have an official plan (from an architect) and realize that there are certain requirements that had not been taken into consideration on their first bid. Their prices have now doubled! Adding to this is the fact that construction is a booming business right now and many companies have a lot of work already. They are not interested in taking on any more projects.
This was a scary point for us because, even though we had expected the original bids to go up, we did not anticipate the bids to double in price. We were not ready to give up, we just needed to figure out what our next step was. We had a few meetings with construction experts who helped us edit our plans. This, however, meant going back to the architect and making changes on the plans, which of course, meant more money.
Finally, and I cannot stress this enough, is the importance of looking through contracts carefully. Our lawyer very wisely said "there aren't any 'good' or 'bad' contracts, there are just 'informed' and 'uninformed' parties". A contract is a negotiation, you shouldn't sign one until you are completely clear on everything that you are agreeing to. Some things will benefit you and other things will benefit the other parties involved. We each have our reasons as to why we would agree or disagree to the terms listed. Having an expert lawyer walk you through each point is crucial. You are committing yourself legally and could be spending thousands of dollars in the future if you try to save a few hundred in the present by skipping the professional council of an attorney.
This all seems pretty daunting, I know. But you are not alone! We live in the USA, and if there is one thing that this country has, it is resources! I've mentioned ProsperaUSA.Org in my past posts. They are an organization that helps small business owners who are hispanic in obtaining all of the help they need. They even subsidize some of the costs! It truly is a wonderful option if you qualify and have time. Everything we did through them took a long time to process. Be mindful that if you are not paying directly for a service, you may be waiting longer than usual for results. Prospera helps hispanics, but there are many similar organizations that help other ethnicities too. Look for your country's chamber of commerce in Central Florida, they may surprise you with similar aid. I have listed a few below to give you an idea:
We are all in this scary adventure together. I wish you all the best in your own journey as a small business owner, whether its now or in the future, its never too early to start teaching yourself about the steps you will need to take. Through this blog you are a witness of all our successes and failures, hopefully it will serve as a reminder that the road to success is never a clean straight shot, rather a steep hill with sharp turns and abrupt stops.
Below links to the experts that have been guiding us through this process:
Rishi Bagga (Attorney) : http://www.rsbesq.com/
Chris Gremley (Broker): http://gremley.com/
Bimi Solutions (Architect): http://bimisolutions.com/
Insurance Matters (Insurance Broker): Insurance Matters Facebook
JoLynna Kholer (Graphic Designer): https://justbeingjo.com/
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