Walls are closing in!

**dsung** · 06-02-2008 12:09 PM

Hello all the entrepreneurs out there. I have quite a predicament and am not sure what direction to take. I started a commercial cleaning company with a business partner 6 months ago. We currently bring in $1,500 a month with all 4 of the companies. My business partner and I also have a rental property that has 2 vacancies right now and is costing us $1,800 a month (the $1,000 is because he didn't pay the taxes on the house, so for 6 months it will remain like that). The other business we started 2 months ago is a console video game center. The bills for that comprise of $2600 a month for everything. Both of our personal bills constitute $2,500 a month from loans and monthly bills. Our gaming store has gotten a very good response from the people that have come in. We know that it will be profitable, but the reason we have not had a lot of traffic is because the word is not getting out fast enough and a video game center is still a very new concept to our area. We are maxed out as far as credit is concerened and very much want to keep our store. The only other option we can think of is closing down the store. We even thought about one of us getting a job...to help out. However, we can not come up with a sure fire way of meeting all our monthly bills, while still having enough income to cover gas and food. So, if anyone has any ideas of how to raise money in our situation or just general advice please respond. Thanks.

**rogercbryan** · 06-02-2008 12:24 PM

Poor planning = poor results.... Just had to throw that out there. You may have to look for another partner to bail you guys out. It does sound like you all are trying to do to much at once. Figure out which project is the most cash intensive and has the lowest ROI and cut it. It's better to loose one element then to try and hold on for too long and loose it all.

Good Luck... and life could be worse.. you could be in the desert with people shooting at you so take a breath and you'll figure it out.

**david90** · 06-11-2008 06:06 PM

It does seem like you are doing too many things at once. U might be due for a burnout.

I would get rid of one of the businesses.

**aeolus** · 06-11-2008 06:36 PM

Before starting best is to have a business plan and have it approved by a commercial court judge/lawyer.

It does cost some extra money but overall they do have far more expertise when looking at a business plan if it will be sustainable or not.

Now a big mistake that a lot make is due to the fact that starting a business doesn't cost a fortune anymore as it was in the past. And that they just think... money will roll in...

They seem to forget the advertising part, advertising costs money, even as your company didn't cost much. You do need a decent ad budget. Not one time, but every month again and again.

Here was our initiall plan how to, note that we provide services so it's way different than a company that sells goods.

revenue:

20% Ad budget
20% Safety Fund (liquidity)
30% Operating costs
30% owners (if no employees)

Now note that this is all gross, not net so you need to calculate also in what will go to the tax department, social security etc... the 30% owners will be easy 15% after reduction of all extra stuff to be paid.

Now back to your topic

File for bankruptcy and see it as an expensive lesson, learn from it. Or find a 'dumbass' that will take your business over so it will be a 0 operation for you and your partner.

On a personall note, I wouldn't dare to think starting a business that makes a few k a month... minimum goal should be 12,500-25,000 a month imo

md