Brower: Sometimes doing nothing at all can be a success in entrepreneurship (column)
There are few occasions in life when doing nothing can be considered a success.
But this is one of them.
An ambitious, motivated and perhaps well-funded individual comes up with a great idea for a new business. In this case let’s say that new business is a gift shop and boutique in an extremely seasonal tourist town right next to a prominent national park and a bustling ski area.
This entrepreneur got her idea for this boutique after she spent a week vacationing in a town near this ski area and national park and she noticed that the place was slammed with people looking for places in which they could spend their money. She noticed there was no boutique that offered the particular sort of product line she had in mind.
And voila, she got excited.
She had savings in her bank account. She had a rich uncle who was willing to lend her money at a better rate than going market rates and she had always wanted to live in the mountains anyway. And there was a surprising surplus of retail spaces for lease right on Main Street. Now was her chance.
And she’d be her own boss, as well.
So she moved to the mountains, leaving behind her comfortable life in a prominent Midwestern city, opened her store and was so overwhelmed with business that she used her surplus profit to franchise her gift store idea in numerous resort towns in America and after five years she sold her chain of stores and retired at an early age to live a life of luxury? No, sorry, just kidding.
What really happened is she opened her new boutique in the beginning of the off-season and she started wondering where all the people were. She started using her uncle’s money to fund operations and when the high season arrived she couldn’t afford to hire the help (or even find the help, for that matter) she needed to maximize the good times and she went from high season to low season barely breaking even.
She still loved living in the mountains but after two years she threw in the towel and moved back to her old job in that prominent Midwestern city and she wondered what had possessed her to take such a risk that had cost her two years of her life and ruined her once warm relationship with her rich uncle.
For her, doing nothing at all would have been a success.
Which is not to say there isn’t anything she could have done to fulfill her entrepreneurial dream.
She could have done a serious, year-round market analysis (talked to the chamber, talked to other business people, looked at other business trends in the town), done a cash flow projection for her business based on that analysis, determined the honest start-up costs, set aside cash for one year of operating (to include marketing) and then decided if it was worth it all based on her business plan completed before she opened her doors.
Which is to say she could have seen it all coming and developed realistic expectations about the business. What this usually means is she would have still opened her business, but she probably would still have another job to fund her investment and she’d truly be aware of the hard work, lower pay and pitfalls that come with starting a new retail business in a resort community.
Then her rich uncle would have made a five-year investment based on a solid business plan that showed positive cash flow after three years and she would have been able to live happily in the mountains just like she had always wanted.
In this case being forewarned is being fore-armed, as they say. And with the right expectations, she could make it a success — not by doing nothing, but by doing the right things ahead of time.
Patrick Brower is the Enterprise Facilitator for the Grand Enterprise Initiative. He provides free and confidential business management coaching for anyone who wants to start or expand a business in Grand County. He can be reached at 970-531-0632 or at firstname.lastname@example.org.
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