One of the most asked questions during my appearances on MSNBC's Your Business revolved around timing a new business.
Many people will rightly ask you, “The economy is so tough. Why would you want to open a retail store or start a new business NOW?”
Look, the economy has always been tough...
But remember, in 1945, the world saw both the dropping of the bomb and the French invention of the bikini.There is always an entrepreneur to look at things differently because they are up for the game.
Maybe you’ve always wanted to be your own boss. You’ve always enjoyed shopping and think opening your store will be fun. It can be fun but make no mistake, succeeding in retail is about planning, change, and making yourself available.
Scads of store customers know who the owner is because they are seen on the premises practically every day. Then there are the unsuccessful absentee storeowners -unmotivated employee inmates running what seems to be a prison within sterile surroundings.
The choice to open your store should be made with your eyes wide open. Deciding to have a child or adopt a pet is a significant lifestyle change, and so is owning your own retail store.
Before you pick out a dog from the ASPCA shelter, you need to know who will feed it, clean up after it, take it to obedience school, wash it, walk it twice a day, etc.
As the business owner, you’ll need to know who will run the store, what you will sell, and how this will affect your vacation plans, family responsibilities, and finances.
While you might have inherited or purchased a family business, the choice is still the same – do you want to jump in or tip-toe around? I call tip-toe hobbyists – they are owners when it is convenient for them. They take few risks and would rather not be bothered with the day-to-day challenge of running a successful business. Hobbyists are great to compete against, though – they give you a clear picture of the dangers of slacking off.
How do you know if a retail store is for you? Answer these questions:
What would you feel like if you had to work Christmas Eve until 8 pm?
Realize it could happen, no matter how great your employees are. Like Roseanne Roseannadanna said on Saturday Night Live, “It’s always something.”
What would you do if a friend’s child broke one of your expensive baubles and did not offer to pay for it? It will happen, and it is best not to take it personally. You’ll need to be able to separate personal relations from your business.
How would you handle your manager leaving early and going skiing over the weekend without telling you in advance? Would you reprimand them, and what if the manager was a friend working for you?
What would you do if your favorite item you stocked heavily didn’t sell?
You have to separate your personal favorites from what the marketplace desires.
Have you ever had to fire someone?
It’s part of doing business. If you hire them, they will eventually leave you, or you’ll have to fire them. You need to have the stomach to put someone out of work.
What would you do if you caught a shoplifter?
Shrinkage occurs not only from customers but also from salespeople. A forceful response reduces it in your store.
Do you hate repeating yourself?
Training is about sharing your vision of service and making your employees as close to a carbon copy of you as possible. That takes a lot of time and repetition.
Do you genuinely like talking to other people?
Retail involves connecting with people, from your crew to your landlord to your vendors and customers. If you don’t like to do that, this is probably not for you.
Do you get a thrill from making a sale?
The sense of accomplishment and rush from a particularly large sale is necessary to balance the inevitable slow day or January doldrums.
Have you visited other stores that carry similar products and know where they are weak?
Competition is healthy for seeing how you would be different. You should not be afraid of anyone selling anything similar to you.
Could you survive financially for 8-18 months without drawing a salary from the business?
The greatest cause of retail businesses closing is having an unrealistic idea of breakeven and profitability. Get enough money from your bank so you don’t cripple the business.
Do you have a great location?
This can be a great asset, but test it by asking your friends if they go to that center and why or why not. You don’t want to get “a deal” on a property only to learn later if it was due to poor visibility or parking. You never want to be 100 feet from success, so visibility is key.
Do you like to create a team atmosphere, or do you want to be the "OWNER?"
Retail is teamwork. If they are afraid, employees rarely go out of their way for the boss or the customer.
Do you have a great idea of how your retail business will stand out?
A plan created early assures success. Who are your customers, and why would they be willing to crawl over broken glass naked to buy from you?
Are you prepared to work long hours?
The average retail store is open 70 hours a week, including weekends.