Building a business can be a rewarding experience or an
expensive lesson in life. Success depends on the business climate
in one’s community and one’s knowledge of basic business rules.
After 20 years in business, I’ve learned to live by five simple
rules.
Building a business can be a rewarding experience or an expensive lesson in life. Success depends on the business climate in one’s community and one’s knowledge of basic business rules. After 20 years in business, I’ve learned to live by five simple rules.
No. 1: You’re in business to make a profit, not give the store away.
No. 2: Price depends on supply and demand.
No. 3: Save for the lean times.
No. 4: Continually invest in capital improvements.
No. 5: When someone makes the right offer, sell the business.
Owning a business is really quite basic, except for the fact that one must devote their whole life to making it succeed. Oh, and also put their entire life’s savings into it. But no matter, there will always be those people that want you to give them everything for free and in exchange they will tell you what you’re doing wrong.
Of course these people aren’t the ones that come into your business to show their support financially. No, these valuable non-consumers believe in redistribution of wealth. They feel as a business owner you have hordes of money and should split the proceeds with them.
Unfortunately, “the give me everything you got crowd” is on the move again in San Benito County and is working the circuits from the farmers to local government.
Recently, one individual from this crowd attacked my business (The Vault) for having the audacity to try and make a profit during the biker weekend. Call the police! It’s true! I plead guilty. I made a few bucks over the weekend.
The concerned citizen was furious that my restaurant had the nerve to charge an incredible $15 entry fee during the evening. I know, $15 will send most of us to bankruptcy court, but I was following rule No. 2 in business. I didn’t know what else to do. What would you have done in my situation?
Here’s the problem. I had 500 people inside my restaurant (which is full capacity) and another 500 people waiting in line to get in. About 300 of those inside the restaurant were our frequent diners, which we love to death, and, of course we let them in for free. The rest of the people in the restaurant and in line were people that we’ve never seen before.
Adding to my problem was the fact that I had to pay the bands, the DJ, the extra 20 security guards needed to ensure a safe environment, plus the overtime for all of our regular staff.
Oh, then there’s the bill that just came in from PG&E for $4,000, which only two years ago used to be $800 per month (thank you governor).
I guess I should also add that worker’s comp and liability insurance is skyrocketing and that every governmental agency in the nation wants a piece of the action, plus someday I hope to recoup the half-million dollars that I originally invested into the business.
Now, as an aspiring business owner what would you have done? Remember rules 1, 2, 3 and 4.
Dear Mr. Give Me, maybe you should look at rule No. 5 and make an offer or spend the next Fourth of July weekend dancing in your garage.
Ignacio Velazquez is the owner of The Vault restaurant and regularly contributes to the Free Lance.
