2. Don’t reinvent the wheel. Ask the experts how things work. Alan and I did a fair amount of networking with other people in the industry, but looking back, we also let a lot of opportunities go that could have helped us learn more.
From all our networking, we thought we grasped the basics, but still didn’t realize just how important storage would be. It's quite complicated to balance out the assortment you want with the quantities you need (i.e., not too much, but not too little) with the order minimums and pricing breaks that different distributors give. It's like a giant logic game to make an order. Meanwhile, our basement is extremely hot because the heating pipe that runs along our ceiling isn't insulated and there isn't an easy way to cool the space. This means that, until we figure out a solution, we can't store any inventory there.
Having more conversations with more store owners and distributors would have helped us realize the importance of being able to accept extra inventory. You should talk to as many other people in your industry as you can. Find out what their biggest obstacles were when setting up their businesses. Learn the inside scoop. And then, when you think you’ve learned enough, talk to more people.
3. You always need a back-up plan. For everything. Even items on your to-do list that seem taken care of can suddenly fall apart. For example, we first signed a lease for a space in south Williamsburg in Brooklyn. But even with the lease in hand, we should have kept looking for spaces. New York law says your entrance needs to be more than 200 feet from the main entrance of any schools or churches, and even though we had worked with a lawyer to qualify our space, our liquor license application was denied. It turned out that a charter school had moved into the building and was using an entrance that was within 200 feet. We walked away with about $15,000 to $20,000 lost in rent, minor improvements and architectural plans. Then it took us another five months to find our new space in Clinton Hill.
Another example: Our Internet went down one day, and we realized we needed an alternate way to run credit card transactions. We were able to use my phone as a hotspot to get us through, but I won’t always be around. Now we’re looking at getting a separate device to be the hotspot, as well as one of those old-school carbon-copy sliders in case there is a broader internet outage.
If you’re unsure what types of plans need backups, ask your network for their experiences — what you’ve missed and how to create a back-up plan for it.
4. Be careful about how and when to involve family and friends. My boyfriend built our shelves, which saved us at least $15,000 and four weeks of time. But whenever you’re having business dealings with someone, or whenever someone is doing you a favor, there are bound to be sensitive conversations. And obviously, it's way more delicate to express concerns about money, staying on schedule or to say you don’t like the design of something, when it’s someone close to you. Being under the gun only makes it worse.
For us, it was worth it because we saved lot of money and were able to open in time for the holidays. But I did underestimate how much stress it added, not to mention that it dominated every conversation my boyfriend and I had when it might have been nice to keep my personal life a bit more separate. Do the math to figure out whether it's really worth it to involve close friends, romantic partners or family members. If you're only saving a couple hundred dollars, it probably isn’t.