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Old 03-28-2015, 07:12 AM
 
Location: Henderson, NV
1,073 posts, read 1,039,067 times
Reputation: 2961

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As the father of three failed business ventures and one plan that I canceled prior to funding, allow me to share some wisdom alongside the others here.

1. Time and Effort. No matter what you have done up to this point, if you own it with significant skin in the game, you must pour everything into it including your time. You will find this goes far beyond opening and closing, ordering supply, hiring and firing, and engaging your market--and at the end of the day, if you are exhausted and still smiling, it might be right for you.

2. Most important part of your plan is market intelligence...the information that defines your market and the competition for shares of it. Although a requisite standard in Business Plan 101, few understand what all those numbers and statistics mean to their business. Just because you have a traffic study that shows 32,000 cars drive by your strip mall every day doesn't mean 5 people will stop to eat a sandwich. Fads, like food trucks, can be lucrative in the early life of the fad...but market matters more. The question is not should I open a café? The question is who is the market, is the market being served, and if yes, how do I capture a share of a served market? Example: Your cousin works at the bus station and tells you that everyone has to use vending machines, including the customers waiting on buses and there is no hot food. You do some research and find that 6000 people loiter an average of 17 minutes between transfers and the staff, including the maintenance garage, numbers 31 souls, who you casually surveyed would love to have an alternative to bringing their lunch and drinking vending machine coffee all day, everyday. How do you translate that information into a business plan? Many have tried.....

3. There are tons of free resources to help you get started--don't let people on here scare you. Start with the Nevada Secretary of State. Next, find out where you can find the local chapter of SCORE (Service Corps of Retired Executives) and get connected to these folks (it is free) and you get advice and coaching from people who do well in business instead of people like me who are still working for that success.

My best business endeavor was deciding not to go forward on my latest plan. It was a gem, and I modeled it and ran simulations under best and worst case conditions and could not see profit in worst case, so I stopped work. It is possible that my researched best case was really the worst and the plan was solid, but I trusted my research and feel pretty good that my math was right. And referencing #1 above, in my simulations, it dawned on me that it would be at least 2 years before I could take a day off...maybe 18 months if I could find and train the right employee (another major business challenge). Too attached to my vacations for that mess.

My worst business endeavor was failing to market and network with the right clientele. I had a hot service with little competition, but the market was difficult to penetrate. I thought I could keep my day job and keep up with the business. I failed to support my employee (whose services we were built on) by not understanding the right balance between production of results and driving future business (adv, marketing, and networking), so even though we had 6 months of cash raining down on us (it was amazing), I did not lock down the next 6 months of work, so instead of finding the next client, I was counting sick cash. Unfortunately, new and repeat clients are worth more than a couple of big strikes. The lesson is that I put neither enough time or effort into the business. And no, I was not a one trick pimp.
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Old 03-28-2015, 08:53 AM
 
46 posts, read 63,449 times
Reputation: 82
Some good responses in this post
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Old 03-28-2015, 12:17 PM
 
1,384 posts, read 1,674,937 times
Reputation: 737
This is the BEST POST in a long while. Thank you!

Quote:
Originally Posted by WVREDLEG View Post
As the father of three failed business ventures and one plan that I canceled prior to funding, allow me to share some wisdom alongside the others here.

1. Time and Effort. No matter what you have done up to this point, if you own it with significant skin in the game, you must pour everything into it including your time. You will find this goes far beyond opening and closing, ordering supply, hiring and firing, and engaging your market--and at the end of the day, if you are exhausted and still smiling, it might be right for you.

2. Most important part of your plan is market intelligence...the information that defines your market and the competition for shares of it. Although a requisite standard in Business Plan 101, few understand what all those numbers and statistics mean to their business. Just because you have a traffic study that shows 32,000 cars drive by your strip mall every day doesn't mean 5 people will stop to eat a sandwich. Fads, like food trucks, can be lucrative in the early life of the fad...but market matters more. The question is not should I open a café? The question is who is the market, is the market being served, and if yes, how do I capture a share of a served market? Example: Your cousin works at the bus station and tells you that everyone has to use vending machines, including the customers waiting on buses and there is no hot food. You do some research and find that 6000 people loiter an average of 17 minutes between transfers and the staff, including the maintenance garage, numbers 31 souls, who you casually surveyed would love to have an alternative to bringing their lunch and drinking vending machine coffee all day, everyday. How do you translate that information into a business plan? Many have tried.....

3. There are tons of free resources to help you get started--don't let people on here scare you. Start with the Nevada Secretary of State. Next, find out where you can find the local chapter of SCORE (Service Corps of Retired Executives) and get connected to these folks (it is free) and you get advice and coaching from people who do well in business instead of people like me who are still working for that success.

My best business endeavor was deciding not to go forward on my latest plan. It was a gem, and I modeled it and ran simulations under best and worst case conditions and could not see profit in worst case, so I stopped work. It is possible that my researched best case was really the worst and the plan was solid, but I trusted my research and feel pretty good that my math was right. And referencing #1 above, in my simulations, it dawned on me that it would be at least 2 years before I could take a day off...maybe 18 months if I could find and train the right employee (another major business challenge). Too attached to my vacations for that mess.

My worst business endeavor was failing to market and network with the right clientele. I had a hot service with little competition, but the market was difficult to penetrate. I thought I could keep my day job and keep up with the business. I failed to support my employee (whose services we were built on) by not understanding the right balance between production of results and driving future business (adv, marketing, and networking), so even though we had 6 months of cash raining down on us (it was amazing), I did not lock down the next 6 months of work, so instead of finding the next client, I was counting sick cash. Unfortunately, new and repeat clients are worth more than a couple of big strikes. The lesson is that I put neither enough time or effort into the business. And no, I was not a one trick pimp.
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Old 03-28-2015, 01:35 PM
 
29,474 posts, read 22,487,125 times
Reputation: 48169
Really good and fascinating advice and information on here.

In the employment section, whenever people talk about struggling to find jobs, some seem to automatically chime in with, "open your own business."

If it were only that easy, from choosing one in the first place, to actually making it work and profitable for the long term.
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Old 03-29-2015, 02:32 PM
 
13,586 posts, read 13,077,256 times
Reputation: 17786
Quote:
Originally Posted by winter-rabbit View Post
If you really want to do it, buy or lease a place that has been in operation with the equipment in place.
Anthony Bourdain's first book, Kitchen Confidential, should be required reading for anyone even pondering the idea of the restaurant biz.
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