Small business in a small town, no cash!

**popsandfriends** · 07-29-2006 11:28 PM

Hey all,
me and a trusted friend have been thinking about starting a small business in a small town called Brunswick, ME. We figured out that the younger part of the community like high schoolers would be a popular crowd to attract to a downtown cafe. We could provide a wide selection of drinks and snack foods, standard tables, a couple window booths. A jukebox with modern music, a modern interrior look to the place. Internet and a few computer terminals (wirelss access as well) and then a HDTV you can play games and movies on. Of course we have no idea HOW to get this ball rolling, or how grants work but we beleive that we can do this and make it work. We're determined and pretty professional about most things in life, why stop now

Any help or guidance is appreciated! Thanks!

Hunter

**paul2145r** · 07-29-2006 11:44 PM

My wife and I talked about doing the same thing in our small town in TN. PM me, and we can maybe share ideas!

**akula** · 07-30-2006 12:36 AM

Originally Posted by popsandfriends

Hey all,
me and a trusted friend have been thinking about starting a small business in a small town called Brunswick, ME. We figured out that the younger part of the community like high schoolers would be a popular crowd to attract to a downtown cafe. We could provide a wide selection of drinks and snack foods, standard tables, a couple window booths. A jukebox with modern music, a modern interrior look to the place. Internet and a few computer terminals (wirelss access as well) and then a HDTV you can play games and movies on. Of course we have no idea HOW to get this ball rolling, or how grants work but we beleive that we can do this and make it work. We're determined and pretty professional about most things in life, why stop now

Any help or guidance is appreciated! Thanks!

Hunter

Hunter,

Point 1: Make a decision. Ok...to move forward, you first need to make a distinction between lifestyle and high-potential business. Lifestyle businesses are those with projected revenues of under $100 million in 5 years, or total market share of under 20%. High potential businesses are those with projected revenues of over $100 million in 5 years or, projected market share of over 20% (of the total global market).

Because certain people specialise in financing high-potential businesses, lifestyle ventures (what you have) are harder to finance. For all practical reasons, if you just put the money you borrowed for your cafe into an index fund - you'd get a better return than running your corner shop. That's why it's a lifestyle business (i.e. you're doing it for lifestyle reasons) which is often an unattractive investment.

So you need to decide whether you're gonna be starting lifestyle or high-potential ventures.

Point 2: Risk - Return Equation: To cut the analysis short, the conclusion is this: to make your life easier and get better results quicker, forget about doing a greenfields operation (starting from scratch). Open a franchise business.

You currently do not have the skills to make your lifestyle business successful. To protect your self from bankruptcy and your marriage from unnecessary stress - contact your favourite franchisor and enquire about how you can open a shop in your community.

Hunter, on a personal level I need to tell you this. Virtually every single married couple I've known who've started a business, ended up in divorce. Franchising is just one way to avoid getting into severe arguments with your spouse, but ideally - you should have a serious talk with someone about how your business will impact on your relationship.

The nightmare scenario is this: either the husband or the wife have invested a lot of energy in the company, but it's just not working (which is the normal thing - success is very rare). The other partner has had enough and drops out. The husband or the wife now has to work even harder and invest even more energy. Then, the other partner ask for the business to be wound up - but the first partner can't bring them selves to close shop because that would mean they've wasted up to 5 years of their life on a black hole. The resulting tension leads to a break up because the first partner can't stand being disrespected, and the second partner can't stand being further down on the 1st partner's list of priorities.

And there are other equally bad situations.

Finally - have a think about this stuff. Running a small lifestyle business is not fun, and it's definitely not financially rewarding. I'm guessing that you're the person who is keen on making this startup happen and you may want to realise that what you're suggesting is not rosy. It's gonna be years of pain and tension. Do consider if the rewards are sufficient enough to justify the sacrifices.

**BOG** · 07-30-2006 04:07 AM

You just crushed hopes and dreams

**akula** · 07-30-2006 06:34 AM

errr...yeah...i dunno why I posted that

i'm just trying to be helpful

a) either do a franchise
b) provide a very good reason why you shouldn't do a franchise
c) if b) is compelling - there are a number of steps that make for a successful greenfields operation, and I can cover those as well

NOT MEANT TO BE NEGATIVE

**paul2145r** · 07-30-2006 09:29 AM

Akula is a dream crusher, lol. Negative feedback is often the best kind- it helps you re-examine your idea, and find the flaws and week points in the concept. But you should never forget an idea just because of negative feedback. If you believe it will work, push through, and Make it work.

Franchising is one method to make things easier, but then again, it has its share of headaches. You have very little creative control, and are watched over by someone that isn't even an investor. If you can find a lenient franchise, so much the better, but otherwise, I would rather try finding other people trying to do the same thing, network with them, and go from there.

**popsandfriends** · 07-30-2006 11:02 AM

Unfortunately, on Main St (the only place where there are a few buildings for sale or lease) there arent many franchises. Isn't starting a cafe/coffee house just like starting a regular business? Sorry, i dont know very much technical stuff right now. Still learning about LLC, franchising, etc. I have heard that its easier to get grants if you are a youth because it shows you are dedicated. Also, I heard that the business plan is key, and professionalism is also key

**WanganRunner** · 08-01-2006 12:44 PM

Well, franchises have already figured out most of the hard stuff, i.e. the product, the pricing, the marketing, and all of that.

You're just buying the ability to use their good ideas to your advantage.

With a from-scratch venture like that, you have to endeavour to get all of that right, and what's worse, you have to beat those big guys at their own game should one of them move into your area, which is not a good position to be in.

**popsandfriends** · 08-05-2006 11:20 AM

Yeah, we have tough competition accross the street. But if we make our cafe have more, much more, than any other (and its streamlined and no random) then we can really begin to blossom. I return from my vacation on august 20th, what should my friend and I do to prepare and get this rolling? Also, how long would this planning process all take(ballpark)?

Thanks!

**adrizzle** · 08-08-2006 03:22 PM

I would go to my website Topitoffpromotions.com and sign up as a distributor. Either use this to make money to get your business going or stay with this business that has a lot of potential to make a good amount of money.