The Business Life Cycle: Final Thoughts and Small Business Advice

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This is the 7th and last post in a series by Bradley Saul, called “The Business Life Cycle.”

Over my past few posts, I gave a glimpse into the rise and fall of the bike store I co-owned for five years.

There are loads of business books full of tips and advice on how to succeed in business. I created my own list to share with you. I tossed it in the trash.

Throughout these posts, I haven’t told you one thing: I never wanted to run a bike shop. That is, I did not want to deal with customers or managing employees. Continue reading →

The Business Life Cycle: Business by the Numbers Part 2 – Inventory

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This is the 6th post in a series by Bradley Saul, called “The Business Life Cycle.”

In the last post, I looked at my business’ total sales revenue over the course of its existence. In the graph below, I broke down sales by inventory category. I defined an inventory product as an item that we stocked and expected a frequent turnover, as opposed to rentals or service.

The first stacked bar chart shows the proportion of sales for each category.

Sales by Inventory Category

Continue reading →

The Business Life Cycle: Business by the Numbers Part 1 – Sales

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This is the 5th post in a series by Bradley Saul called “The Business Life Cycle.”

In the next two posts, I’ll share sales reports for the five years of our business.

The following table shows 2008 as the best year for sales. Though 2008 was the first year of the recession, it was boom time for cycling in California as summer gas prices stayed over $4 per gallon. This initial boom tapered off by October 2008; then it became time to learn to actually run a business. We managed to make it through 2009 and 2010. A variety of factors including increased competition, owner burnout, and a wet Spring led to a remarkably poor 2011.

Sales by Year Continue reading →

The Business Life Cycle: Business Mistakes And Work-Life Balance

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This is the fourth post in a series by Bradley Saul, called “The Business Life Cycle.”

In my previous post, I discussed the mistakes we made in 2008 that eventually led to our demise.

We started to get the hang of running a business in 2009 and 2010, but a few factors stood in our way.

First, my business partner wanted to invest additional funds to both remodel our store and commit to a high-end bike brand. The remodel was desperately needed. As business increased in 2008, we found that employees were tripping over each other and the retail space could be much better used. Admittedly, I cautioned against making a huge commitment to a high-end bike brand. We were having trouble with cash flow and maintaining inventory levels on entry-level bikes that sold well. If there’s money to invest, I said, let’s invest in products that we know are turning over. Continue reading →

The Business Life Cycle: The Reality For One Start Up Business

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This is the third post in Bradley Saul’s series, “The Business Life Cycle.”

Upon opening, we were immediately well received by the community. We realized just how tough and how much work small business ownership can be, but we were excited. We were exceeding our sales projections. We felt like we could pull this off.

While many businesses struggled at the beginning of the recession, we exploded in the Spring of 2008. As James Macpherson of the Associated Press wrote in May 2008, “Four-dollar-a-gallon gas is good for business — if you run a bike shop.” If you know how to scale your business and manage an overload of business, a sales boom can be great. Otherwise, it’s a curse disguised as a blessing. Continue reading →

The Business Life Cycle: The Small Business Plan Becomes Reality

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West County Revolution 3

This is the second post in Bradley Saul’s series called “The business Life Cycle.”

The executive summary of our business plan began:

A June 20th Press Democrat article identified Sonoma County as a “New ‘Must Ride’ for Cyclists.”  From the waves to the wine, western Sonoma County is a popular destination for cyclists from all over.  Sebastopol is home to a large population of avid cyclists.  However, in an area crawling with bicyclists, there is no bicycle shop in a 6-mile radius of Sebastopol nor is there a bike shop west of Highway 101 from Cotati to Healdsburg.  The West County Revolution aims to fill that gap. Continue reading →

The Business Life Cycle: What I Learned After 5 Years

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This is the first post in the series, “The Business Life Cycle,” about my experience opening and closing a bicycle shop.

On July 15th, 2012, the West County Revolution Bike Shop closed its doors for the last time. My business partners and I made a go for five years, but with our lease up for renewal and a business that, well, wasn’t quite worth it, we decided to lock the doors.

In this series of posts, I will reflect on my experience as a small business owner. So often you read about what it takes to make a successful small business, but sometimes we learn more from failure. Whether you have an established venture or intend to start your own business, I hope my retrospective is useful to you.

We interviewed many fellow business owners before we opened, but we did not have any specific sales numbers from which to make educated projections from. I will share some of our sales reports, and though the numbers come from a bicycle store, the lessons from our business apply to any retail business owner.

Before picking apart the West County Revolution, let’s look at the retail sector as a whole. Using data from the Census Bureau’s Business Dynamics Statistics, I’ve plotted the probability of survival for retail firms established in 2005. (They presently don’t have data beyond 2010, so I chose the first time at which I could see a 5-year trend).

Probability of Business Survival

Relative to the rest of the retail sector reaching the 5-year point defies the odds, but surviving does not mean thriving. For the most part, we were trying to keep the business alive.

In the next installments, I talk about turning our dream of owning a business into reality and what that looked like for us.

Start Thinking About Taxes

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Sure, it’s only January. But April 15 will be here before you know it! And with plenty of time before filing day, now is the perfect time to start looking for those deductions and credits. Nolo.com provides great tips and often overlooked expenses that you can use to ease the pain of filing business taxes.

1. Business Start-up Costs – Before your doors even open, you incur several costs just getting your business off the ground. You can deduct $5,000 of these capital expenses the first year of your business. Remember that all the daily expenses of advertising, utilities and supplies can also be deducted – but only AFTER your business doors are open.

2. Auto Expenses – We probably all use our vehicle for work. So always keep track of your car expenses! There are two ways to deduct auto costs. The actual expense method requires you to track and deduct all your business expenses. The standard mileage rate method means you add up all your work-related miles travelled and multiply it by the IRS’ standard mileage rate.

Not sure which options is best for you? If your car is used for both business and personal, you can only deduct the business portion. In this case, tracking the mileage may be your best bet. However if you have a newer car, the actual expenses method may provide an overall larger deduction. Plus with this method, you can deduct the vehicle depreciation amount.

3. Books and Professional Fees – Do you subscribe to industry magazines for your business? What about business books you’ve purchased? These are both fully deductible as a cost of doing business. And all those fees you paid your lawyer, CPA or consultant? Yep, those are tax deductible as well.

4. Bad Debts – This one may not apply to everyone. But it’s worth considering, especially if you’ve had a client or customer who skipped out on paying you. If your business sells actual goods, and a customer took your products and stiffed you the payment, then you can tax deduct the cost of those goods. Unfortunately the same cannot be said for services that were not paid.

5. Interest – Did you know you can deduct interest on business purchases? If you use credit or a personal loan to pay for business expenses, the interest incurred is fully tax deductible.

Being a business owner or entrepreneur can be tough at tax time. But if you keep track of your expenses and deduct the items you are entitled to, you are likely in much better shape than you expect. Don’t let April 15 come without being prepared!

5 Tips to Make Your Business a Success

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In today’s economy, it’s crucial for your business to stand out among the competition. Here are five tips that will bring success to your retail shop. 

1. Customer Service is Key! One of the main reasons consumers are shopping in stores as opposed to online is for the extra level of in-person service not available on the web. And with online rating websites like Yelp, a little bit of good (or bad) customer service goes a long away in people’s minds. Treat customers like a pro and remind them that the level of service they receive in your store is their reason to keep coming back.

2. Use the Best Signs and Displays to bring in the customers. According to Entrepreneur, storefront signs and displays are the best way to grab customers as they walk by your store and tell them there’s a reason they must go inside your store. Key words like sale, discount and last-chance are motivation and action words that draw crowds not wanting to miss a bargain.

3. Stay current on trends. It’s important to know the latest fads and what people are buying. But on the flip side, it’s also important to know your customer and not try to entice them with a trend that they clearly won’t  benefit from. Entrepreneur encourages business owners to ask the key questions: Will it sell in your store? Does it fit your theme? If the answer is “no,” then it’s best to leave that trend by the wayside.

4. Draw Them In (and Keep Them Coming). Once your display signs and banners bring the shoppers in, what’s next once they’re inside? Place the deep discount items at the back of the store so the customers have to walk by all the regularly-priced items first. Keep a theme in mind when stocking your shelves. Having dozens of options and items may be very cool, but it can also be overwhelming to the buyer.

5. Location, Location, Location. If you already have a shop, you’re probably not looking to move right away. But for those of you just getting started, be sure to put research and thought into the location you select to start up a retail shop. Go to where your customers are. If you’re selling to teenagers, a mall may be a better bet than a small shopping center in a suburban community. And if you opt for the mall route, pay attention to the stores around you. You don’t want to sell beauty products at the end of the shopping center that contains mostly men’s interests.

Today’s economy and the age of the internet are tough. But retailers are thriving because they are following the right steps to be successful. Knowing how to market to customers, provide quality service, and knowing your audience are three of the best lessons you can learn as you run your business.

Why Your Business Needs to be on YouTube

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Online video has become one of the fastest growing content areas on the Internet. YouTube sees 800 million unique visits each month and 72 hours of video are uploaded to the site every minute. With impressive statistics such as these, you may want to think twice if you don’t have a presence on YouTube. Let’s look at four reasons you want to host your company videos on this popular video sharing platforms. youtube

The Cost – If budget is a concern, there is no better place to host than YouTube because the service is free. Videos take up a lot of storage space. So if you opted to self host, your company would be spending significant cash on large servers.

The Audience — There’s no question that YouTube has the audience with more than 3 billion videos viewed every day. People are on YouTube and looking for content. With the right keywords and descriptions, your video can be found easily and by many people.

No Techie Skills Required – With YouTube, you click a few buttons and your video is uploaded to the website in an instant. Any non-technical user can accomplish this, and HTML coding is not required.

The Search Capability – Every video that is uploaded to YouTube is mined by the Google search bots since the video sharing site is owned by Google. In addition, Google often fails to recognize iframes and embeds that are not from YouTube, thus making it tougher to find your company’s videos by search if they are not on YouTube.

There is no question that YouTube is a powerhouse in video sharing and search. The hosting site offers several advantages for hosting.