I'm torn about doing postmortems on businesses that are closing. I don't want to add to their angst.
Then again, I pointed out the dangers at the time they opened, and it's fair to point out that those observations were correct.
There was a period between 2005 and 2008 where a series of stores opened; the Bulletin would herald their coming, and at the same time actually trumpet the amount of money invested in these new ventures. But it was those very 'enterprise costs', the very thing that made the stores and restaurants seem so interesting, that made it all that much more difficult for them to succeed.
The amounts of money talked about, as initial investments in equipment and inventory, made me cringe. Two especially, seemed to be way more money than could ever be recouped --even by a very profitable business. Even if the business earned enough money to keep open it's doors. The Investment itself was the problem.
One of those two ventures is still open. The other, Riley's Market is closing.
I mean, could you find a more bubbly moment that September, 2007, to open? Could you find a more bubbly spot than N.W. Crossings nascent 'retail' center?
The article in the Bulletin only makes passing mention of: "....part of the closure is related to debt on the store."
They also mention paying 2.35 a foot in rent, plus not being able to sell cigarettes. (Does N.W. Crossing think residents will stop smoking if they don't have a local outlet?)
When I finally had a chance to visit the store a few months ago, they'd basically turned it into a deli.
Linda was talking about some friends of hers, who had moved here from California, and opened a farm where they sold jellies and jams and spices and vinegars. They recently lost the land to foreclosure. They found out, the hard way, that their land was too far from anywhere to get many visits.
I've often thought -- you shouldn't open a business in a town until you've lived in it for at least a couple of years. By then you will have gotten more of a sense about which locations are busy all year long, which locations are seasonal, and which locations look good but really aren't. Or, vice versa, which locations look bad but are good.
There is a tendency, I think, to just follow the crowd.
Linda and I came very close to not opening the BookMark. I mean, we wanted to but we looked everywhere for a good spot, and damned if we could find one. I kept mentioning -- "I wish that spot would come open, I'd grab it in a minute..." and sure enough, just as we were about to postpone our plans, up popped the space and we were on the phone to the landlord.
So Location is #1.
Inventory is #2. What I see happen over and over again is way too much money is spent on the furnishing and equipment and fixtures and fancy new everythings -- and way too little on inventory. You know, the stuff you're supposed to sell. But even there, start with a smattering of many types of inventory, and THEN -- by holding back on spending too much upfront -- pursue the types of product that show some strength.
#3 is labor. Why is it that most closed business I visited never had the owner working? I've been in one local business 4 times, and only once did I see the owner, who was going out the door. A business that recently called for "help."
Really, you know, the hours in a downtown business are at most 48 hours if you close on Sundays-- not so much that a serious owner couldn't work all the hours if he or she was serious about staying open. If you open a business and aren't willing to work 48 hours -- don't open the business. Really. Expect more like 60 hours (working at home, as well) for the first few years....Sorry. That's just the way it is.
#4. Miscalculation. As I said above about living in a town for a couple of years before opening, it'll give you a chance to gauge 'real' demand. Not the demand you saw wherever you came from. Not industry averages. Not the demand you imagine from watching too many Christmas movies which only show the hoards of customers in Hollywoods' version of retail.
Bend, itself, I'm convinced, is an illusion. We have enough retail to serve a town twice our size, in my opinion, while costs aren't much lower than bigger metro areas -- and in some cases, MORE expensive than much bigger metro areas.
So my advice to anyone wanting to open a store in Bend; be very careful in location, spend less on accoutrements and more on inventory, work the store yourself, make sure you have enough flexibility in your costs to last long enough to gauge demand for your product. Don't invest all your money upfront, but hold back and get a sense of the business, and do it in stages. (Grow the business.)
And in Bend, expect to make half the sales you expected, at least at first, and twice the expenses.
48 minutes ago