Area entrepreneurs share tips for success
by Jack Criss
The Bolivar Bullet
About one in five U.S. businesses fail within their first year of operation, according to the latest data from the U.S. Bureau of Labor Statistics from May of this year. Given there are 33.2 million small businesses across the country, it’s almost a certainty that a percentage of them will fail.
According to LendingTree.com, after five years, 48.4% have faltered. And, after 10 years, 65.1% of businesses have closed their doors.
So, what do local business owners think are ways in which these odds can be beaten if you’re thinking about, or have already, gone into business for yourself?
Entrepreneur Will Bradham currently has five businesses in operation to his name. But, he said he’s made every mistake that can be made along the road to his success.
“I’ve got Right At Home, Delta Maids, Bradham Rental Properties, Lenny’s Subs and a new business which will open in about a month, Pinnacle Adult Daycare,” said Bradham. “I’ve worked hard to make my businesses successful but I’ve learned a lot of valuable, sometimes painful, lessons along the way — and you never stop learning those lessons no matter how long you’re in business.”
When asked if he would advise someone to go into business for themselves today, Bradham was candid.
“Do your homework before you follow your dreams,” he said. “Just because whatever you’re thinking about doing might work in one area of the country, or world, it may not work where you are. Fixed costs, overhead, and accounting for unexpected costs have to be figured out before you jump into anything.”
Bradham said a new business owner should determine at the outset how long they can go without a paycheck.
“Whatever you think the amount of running your business for six to eight months, maybe a year, will be without you drawing a paycheck? Well, double that amount,” said Bradham. “And that’s the honest to goodness truth. Just to be safe. I learned that lesson early on because I didn’t listen to people who told me just what I said myself.”
What about the option of obtaining and securing capital to open a business? Bradham advises caution, especially in one possible area of possibly gaining revenue.
“My suggestion is to go into business with as little debt as you can possibly have,” said Bradham. “If you don’t have the capital to start a half a million dollar business, if you don’t have at least, at the very least, a quarter of that amount to do it? Then don’t. Try to start out as lean as you possibly can without sacrificing the service or product or having the stranglehold of a financial institution hanging over you.
“And, by all means, I strongly suggest borrowing from friends or family members,” said Bradham. “If you need capital, try Small Business Association loans or a home equity line. Do you really want to look an old high school buddy in the eye or be at the Thanksgiving dinner table with family members and say that you lost their money? It’s a huge mistake. I’ve seen it happen many times.”
Brett Boykin is owner and president of Southgroup Insurance in Cleveland and offered some valuable advice to those considering going into business for themselves.
“I think the most important thing you can do is be very resilient and persistent,” he said. “But, at the same time, always be smart about it. You have to be prepared for the constant grind that you will face as a business owner. I think success comes to those who are willing to simply do more than anyone else.”
Stafford Shurden is owner of Stafford’s on Main in Drew and has spent years working hard to keep his business thriving. Even in tough times he said he just knew he couldn’t give up and had to stay the course.
“I love the restaurant, as well as my farm and I simply can’t imagine not doing both,” he said. “I guess the key is to find something you love so much that you are somewhat obsessed with it and that obsession will more than likely lead to some success.”
The biggest mistake new business owners make?
‘You overextend yourself or you under-capitalize your business and you can literally go out of business by taking on too much at one time,” said Bradham. “Too many clients can actually be a problem. With my own maid service, we grew so quickly and so fast, but we did it poorly at first. We had under-capitalized. It almost ruined us. Thankfully, we recovered, but we learned a lesson the hard way. Having too much business and not being able to handle it is almost as bad as not having enough business.”
“I have been through periods when I simply did not pay enough attention to cash flow,” said Shurden. “At the end of the day a business is nothing without cash flow. I advise anyone in private business to always ask their accountant to provide a statement of cash flow on a regular basis.”
“I am going to be honest and say that I have made many mistakes throughout my business career but they have all bought me valuable lessons,” said Boykin. “I know at the time when I was struggling with the consequences of mistakes I would not have said this, but looking back I am grateful for those lessons learned. At the end of the day you can’t let fear of failure stop you from pursuing a passion or a business.”