More new business questions!

[Jay H]

I think I have found the best forum for framers. This is why I have chosen to ask my question here. I, like many others here, have decided to open a frame shop. I have a basic knowledge of framing techniques, and have dreamed of owning my own business ever sense my first job at a fast food restaurant. I already have a wall mounted glass/mat cuter, mat cutter, guillotine cuter, manual underpinner, oval cuter (I have no idea how to use this thing), a dry mount press and iron, tables, mat storage bins, and other various framing implements that I have received from my dad’s ex-shop. I have three questions. #1 5 to 6 months of living expenses is all I have right now. Is that generally enough time until I can draw any type of paycheck? Even $300 a week is plenty for me to survive on. Rent and supplies will be about my only start up expenses for the business. #2 How do you decide what you should pay for space. In my city 1000sq/f rents for $1200 to $400. I don’t need to explain the differences here. How should I balance location with cost? #3 I am thinking that in order to keep startup at a minimum not dealing in art (possibly ever). How would selling art effect or not the custom framing business? My mother works at another frame shop here that has art and said that they have very little turnover in their prints and it a lot of overhead there. My dad’s shop here did fairly well selling art (especially Charles Frace’s). Does anybody have any insight on any of the subjects? Sorry it’s so long but it will eliminate multiple posts. Thanks!

[Barb Pelton]

Only a partial reply since lunch break is only 15 min today. (My boss is a slave driver!)

Do more homework. We can't answer if you can survive for the first 6 months or not with what you have stashed back--only you can decide that and there is no way of really knowing for sure--it's a gamble. You need to find out what it is you will HAVE to do to make your goals a reality and then decide if you are willing to do them.

I'm suggesting that you do more homework because of your statement "rent and supplies will be my only ..." Deposits deposits and more deposits, liscences, business cards, signage, etc etc etc will add up in a BIG hurry. These things need to be prepared for and carefully thought out.

Call your SBA office and talk to someone there who can really guide you and warn you about all the possible scenerios and pitfalls of opening a business. You can't prepare enough! Also make an appointment with your Chamber of Commerce and get as much info from them as you can about demographics, your competition and who they are, etc. Even if you DON'T plan to get a loan, do up a thorough business plan anyway.

Get the best location you can possibly afford. Decide who you are targeting and find out where they shop. It's better to pay more for a good location than to spend a fortune to get people to walk through your doors. Also, get the best signage you can afford.

No prints for now. Outta time. Good luck!

[Jim Miller]

Welcome to The Grumble.

You'll get good general advice here, but it might not be as useful as your own judgement for your particular case. We don't know your specific market, your goals, your costs, or other factors that affect your situation.

Generally, the better your location, the more business you will take in. And the more you'll pay for it. Where's the balance? You have to plan that. If you have a so-so location, perhaps you can make up for it through exceptionally good advertising & marketing.

Should you sell art? Most of us do, but some of us shouldn't. Be careful. Countless "art galleries" would go bankrupt if their framing business didn't keep their bills paid. So, your question is well-founded. In my case, we sell a small amount of art, but less than we used to. We have a minimal investment in art inventory, and it will continue to diminish.

You need to make a thorough business plan. That would answer all of your questions. Also -- and maybe more important -- the process of planning will bring up lots of other questions you haven't even thought of yet. Some of those issues will determine the degree of your success or failure.

I suggest you check online for business plan forms & instructions. Also, your local office of the US Small Business Administration can help you a lot.

Join PPFA. Your Kentucky/Tennessee PPFA chapter is active and friendly.

If you have budgeted to attend a trade show, the West Coast Art & Frame show in Las Vegas is next, in January. It is one of the most economical to attend, because casinos subsidize almost everything, including hotels and airfares. WCAF has more classes than any other framing trade show. Take all the business classes you can schedule. Every one of them will save you many times its cost in a matter of months.

For example, Bob Carter teaches classes on business. He can tell you all about using sales per square foot of space as a measure of success. Check the Grumble archives for more information, too.

Good luck to you.

[Maryann]

Having equipment is only part of your startup costs. You will probably have more than rent and materials.
Consider:
rent (security deposits and remodeling costs)
electric
phone
trash/water/sewer
web page/internet connection
taxes
CMC rental
Professional dues (PPFA and Chamber of Commerce minimum)
Insurance
credit card fees/terminal rental
business cards
advertising
computer
pos software
moulding samples (hold out for fee samples)
signage
Subscriptions to trade magazines
trade show attendance and education

You may be able to eliminate a few of the costs in the beginning but most of them will be necessary and ongoing.

[ 12-08-2003, 03:13 PM: Message edited by: Maryann ]

[Jay H]

All very good points! Thanks again. I have Entrepreneur Magazine's book "Start Your Own Business" and have read every word. So I am aware of alot of these things I was just attempting to keep the question as generic as possible. I know that question 1 is relatively impossible for anybody to answer with any degree of certainly. I guess I really wanted to know how long it took your business to produce a paycheck (even a small one)? Especially anybody with a similar scenario like mine when majority of the high-ticket equipment was paid for. My tentative open will be sometime in late March or early April for various reasons. That means that, unfortunately, I wont be able to take in many trade shows beforehand. However I was thinking about taking American Picture Framing Academy’s class in Vegas in January. Thanks again for all your help.

[Barb Pelton]

Jay-
Where are my manners? Welcome to the Grumble.

I didn't get a chance to say that you are off to a good start simply by searching for answers and questioning everything. Good luck with your endeavor. I really enjoy being in business for myself and have never regretted the decision. I sure wish there had been a "grumble" when I started--it's great to get answers and to have a sounding board.

[Framerguy]

Jay,

You have received alot of valuable information here from people who have already gone through what you are contemplating. Make no mistake about startup costs, though, they will be far more than what you stated up front.

I moved my shop recently and started over building a new business from scratch. Had I figured on only rent and supplies for startup costs, I wouldn't be answering your post now.

My rent is $1060/month for 1240 sq. ft. and supplies will increase as your work grows. In addition, I have an $85.00/month utilities and trash pickup bill, I pay about $65-80.00/month for phone, $30.00/month for internet, $90.00/month for electric, $60.00/month for gas, my business license cost me $56.00/year paid up front, my signage cost over $500 for minimal signage, I recently traded off $1250.00 worth of framed art for a complete window treatment including painted lettering, arched openings, shading, and a painted logo with business hours. If it hadn't been for the guy wanting to barter the costs, I would have had to put out that much money for the aesthetic window dressing.

I had over $2000.00 worth of deposits before I ever opened the doors. Bookeeping is $75.00/month. Advertising is running between $1000.00 and 1300.00/month. Renovations were minimal but still cost me almost $1000.00. We haven't discussed insurance and taxes yet.

I came down to Florida with $25,000.00 for startup and that lasted about 6 months. Now I am struggling to make ends meet at the beginning of each month.

Did I happen to mention that it will be almost a year after you open in late March before you will appear in the telephone book?? You will need to figure out how you are going to let the public know that you are open for business until then (and afterwards also) and all that will take money for advertising.

If you are on your own, you will have most of these basic bills, ie., utilities, phone, electric, trash pickup, insurance, etc., to deal with a second time. Where is this money to come from? Car insurance, gasoline, tires, unforseen bills, (I just had a tire delaminate on me recently and had to buy a new one.)

I have been framing for almost 16 years and am not a newbie to the framing business. But, it really doesn't matter if your equipment is paid for or not, it doesn't matter how much you know or don't know about framing or running a business. If you don't come up with a method to get people through your doors that first time, all the money and paid-for equipment in the world won't do you much good.

You HAVE to get warm bodies through that front door opening to generate income, period. How much depends on how particular you are about your finish work, how much you know about all aspects of framing, your background in art, the target group of customers you are trying to entice into your business, your working knowledge of small business, and a helluva lot of raw guts to risk all that you have for a dream.

I am speaking from personal experience, not conjecture or second hand knowledge of what somebody else has done. I won't quit. I won't make excuses. I will simply do everything in my power to generate new business any way that I can and that is what you have to be prepared to do. I basically eat, sleep, and work right now. I dont collect a paycheck. I don't go out on weekends. I don't buy anything more than what I need to get by. But, I go out and beat the bricks every weekend handing out business cards, brochures, and fliers, and introducing myself to other business owners, prospective new customers, and perfect strangers in hopes that I will generate some new business out of these contacts.

One example: I had a small booth at a street fair here in Fort Walton Beach this past weekend. It was cold, windy, and cloudy all day Saturday and the turnout was less than expected. But I met each person who passed by my booth with a smile, said "Good morning" and handed out business cards and fliers offering new clients a 15% discount on their first visit to my shop for custom framing. Today (my normal day off) I was in the shop putting away all the stuff from the street fair when I got a phone call from a couple from central Alabama. They had met me at the street fair and wanted to know if they could come over and get an estimate on a small canvas that they had bought at the fair. To shorten the story, they spent over $350.00 and had the canvas framed and also a large black and white photo double matted and framed w/fillet! Those handshakes paid off with at least one new customer.

Framerguy

[dns ynko]

i think framer guy sums it up. it is not having this or being that that makes a buisness. it is having the desire and the ability to sacrifice and keep your head in the game. if you let up it won't happen. you should have a buisness plan and fianaces in order way before this is attempted. i think it is good to work for a smaller company first to see what they do in order to make money. and many owners are more willing to be honest with you if you work for them and they know what your plans are. use as many sources as possible. trade shows can help a great deal, thay also allow you to meet other framers in your area. these folks can give you some wonderful advice. it is good to take in some of this stuff before you open the doors, and then you should go to keep up on your education.

welcome to the grumble. education is big here and we all want the best for each other here, so ask away and hopefully we shal help.

d

[Jay H]

Framerguy, I could never think you enough for being so candid with me. I think I will have reread your responce several times untill it all soaks in. The number I have been tossing around for opening is $10,000. Maybe I will rethink that a little bit. Your responce is EXACTLY what I needed. Any regrets yet? Thanks again!

[AWG]

Hi Jay:
Welcome to the Grumble. You'll get some of the best advice you'll ever get right here. Follow it, and you've got a better-than-even shot at being successful. Follow your own drummer and disregard any Grumbler-offered advice at your own peril ;)

That being said,I can second what Framerguy tells you:
It's all about bodies through the door. Great mouldings, lots of knowledge, a winning personality and all the skills in the world mean NOTHING unless people know who you are and what you can do. You must do anything and everything you can to get footsteps through your door.

My wife and I bought an existing, 7 year-old gallery last January. We've spent more money than I care to think about advertising our business :mad: . Why? The previous owner spent the last 18 months deciding to sell, and pulled every penny out for himself - little or no marketing for almost 2 years. :confused:

It's easy to make an expensive mistake or oversight that will kill an otherwise well thought-out plan. Have a plan - both for your business financing needs AND a marketing plan. Stick to it, be aggressive and don't let up.

The hard part is -- and I think there are some folks here who would agree -- it is HARDER THAN YOU THINK. I've managed all kinds of business for the last 20 or so years, and I'm still learning something new every day when it comes to running a business. You've got to do it EVERY DAY, without fail, even when you're at the edge and thinking you're doomed.

All that said, Good Luck! :D

Tony

PS to FRAMERGUY: Glad to hear about your folks from Alabama. Good thing you've got that new fillet cutter! :D The blades are on their way.

[ 12-08-2003, 09:34 PM: Message edited by: AWG ]

[Framerguy]

Originally posted by Jay H:
Framerguy, Any regrets yet? Thanks again! Yeah, I have one regret.

I am really sorry that I didn't have the kahunas to make this move down to Florida about 20 years ago!!

I love it here and will do whatever is needed to keep from being homeless.

(Actually, they have a really neat bridge going over to Okaloosa Island that would be a scenic spot for a refrigerator crate and a sterno stove, if the need arises.) ;)

Framerguy

Edit:

There are 2 things that I believe you MUST have to succeed in anything. One is a strong faith in whomever you believe put you on this planet.

The second is a good unwaiverable sense of humor! If you can't laugh at the hard times, they will get the best of you!

[ 12-08-2003, 09:42 PM: Message edited by: Framerguy ]

[Jay H]

That faith is was has led me her thus far and I know that I will be provided for.

My first idea for a living was (are you sitting down?) construction. Yea that’s right. I went to school for five years to be an electrician and have been able to work 5.5 months this year. Five of those months were in a different state than the one my family lives in! So I can't believe that I am that anxious about this.

I think it was Zig Ziglar who said in his book Success for Dummies: "Finding humor in an otherwise aggravating situation is never a losing proposition."

Zig is always so happy. I hate him! LOL

[JRB]

Jay, welcome to The Grumble, you have one heck of a good head start, open your business, get your signs up and get to work.

Forget about when you can draw a paycheck, that ain't how it works. If you have money when your bills are due, you pay them. If you don't have money when your bills are due, you start hustling your business to get some.

You go door to door if you have to. Nothing will build a business faster than fear.

Important: If you can't pay your bills, call your creditors. They will ask you when you can make a payment. Take the time to explain to them that if you could predict the future, you would be a stock broker instead of a picture framer. You can take it with humor or be all serious, but no matter what, call them.

As long as you remain in contact with them, even if you haven't made any kind of a payment in several months, they will hang with you. They do not want you to go chapter seven, believe me.

If you blow them off and don't bother calling them, you problems will be greatly compounded. If you need money for food, again, hustle your business and get some dinner.

The best advise I can give you is,no matter what, no matter how bad it gets, DO NOT QUIT, once you get started.

Put your business plan together , rent your store, just do it. Don't think it to death before you even start. You will be able to figure it out as you go.

John

[ 12-08-2003, 11:12 PM: Message edited by: JRB ]

[David W]

Jay,
Glad to hear of someone else opening a shop, I'm in the process now. All of the posts to your questions were very helpful for me also. Especially helpful was how encouraging the advice is and the underlining message of "Don't Quit". I chose a Main st. location with 1050 rent. I'm hoping the location will pay off, parking is not the best, but it's a busy street. A big part of the location decision for me was based on my personality and what work environment I wanted for myself. I know a woman who opened a shop in more of a back alley industrial space, I'm sure her rent is cheap, it has a very different vibe, but cool. Best luck to you. I'm sure I will be posting many questions of my own on the grumble.

[JRB]

David, parking can and will be a critical factor on your success. People do not want to carry their projects for much distance at all. Take for example a large framed picture with broken glass that needs repairing. A whole stack of pictures that need re-framing. A collection of whatever that needs shadowboxes. These are almost daily occurrences in a frame shop.

The corporate customer is not going to want to have to park a block away to get to you. Even your deliveries can be affected by lack of parking. Another factor is glass shipments. If you purchase glass by the pallet, is there a place for the driver to park his rig? Can it be brought into your store once it's off the truck?

Sometimes we are blinded by "what a cute shop this would make" and we forget the practical side of a custom framing business. Cute ain't worth a darn if they can't get to you with an armload of pictures to be framed.

You may want to re- think this location you have selected. If you can come up with at least two or three guaranteed parking spots for your store, it is probably going to be OK for a while.

John

[Jay H]

That’s neat David. Maybe we can keep each other in check a little bit. I did look at the demographics of your town and WOW you sure do live in a small town. That is around the same price IM looking at here on "Main St". I looked at one this week that 1080 sq./f for $900 a month. It’s in a newer strip mall with pretty good traffic flow. When are you opening?

What I like most about the people here is exactly how candid they are. I have read hundreds of post on here, and I am constantly amazed the quality of help that is offered.

I am opening in April and going to rent in March. Right now I am honing my matting skills, and have just started looking at buildings. Starting January 1st I am going to start fund raising. Here is what I have figured right now.

Start up: Remodel $2000, Card reader $200, Software $200, Advertisements $500, Permits $100, Business Cards $50, First mo. rent $900, finished frames for display $500, mats and glass $500. This totals around $5000. The only thing I don’t have in here is signage because that will vary greatly with where I rent.

Operating costs: Rent $900, Electric Internet and phone $150, advertisement $500, accountant $50, business debt payment $300, insurance $50. This totals around $2000. I left out taxes and supplies because it is directly proportional to my income.

Feel free to compare and contrast off your numbers David. Anybody else feel free to pick apart and shoot holes in these numbers. My skin, at last check, is about 3 inches thick.

[Framerguy]

Jay,

It would be difficult to pick your numbers apart since all areas differ in specific demographics and you sound like you have done your homework on your area of the country.

I spent about 6 years travelling down to the Florida coast and looking at towns from Gulf Shores, Alabama all the way down to Naples, Florida. That is a large area to check out! I narrowed the selections down to Gulf Shores and Fort Walton Beach mainly because of the progress that these 2 towns had made in their city plans to create/re-create an attractive business area for visitors. Most of the "rejuvenation plans" that I saw in other towns are still in the paper stages but these towns have made great progress in making their downtown areas much more attractive for street shopping.

New sidewalks and storefront renovation are only part of the attractions that brought me to this place. They have attracted many new businesses that are unique and they have gotten many of the less attractive stores closed down. (Bars and tattoo parlors and the like)

The only question I have is your advertising budget. Media advertising is expensive no matter where you locate and I wonder if your figure will buy you much in the way of productive advertising. It costs quite a bit to get your name out to the public until the phone book comes out with your listing. I spend about your figure per month in TV advertising alone.

I do wish you the best of luck in your opening and also wish Dave the best of luck. I know how tough it is to get started and maintain a thriving business.

Framerguy

[Jay H]

It’s funny that you ask about my advertising dollars. I am most unsure about that as anything. I figured I would post some questions about this in other threads when that time comes. There are 5 couples in my Sunday school class out of about 15 that already own their own business. I was listening to two guys talking the other day. I about choked on my coffee when one said, "When we first opened we had budgeted $100,000 a year for advertisement. After we learned what type of ads worked best we now only spend about $20,000." I learned right then that I would have to come up with a good game plan quick as I don’t have that type of money to "learn what worked best".

There is very, very little competition here in custom framing. The 2 business that is open isn't actively seeking new customers. They never advertise. One that my mom worked at said that they have as much business as they want with mostly other businesses. They are only open 3 days a week. Many of my friends thinks that Sloppy Lobby is the only place here to get something framed. This is why I think that my location and signage may be my main advertisement.

[Cliff Wilson]

Jay, I am running about 1k/month on advertising this year. This was my first year. I still experimented to try to find what might work. Although you will get great comments from TG, you have to figure your area out.

For example, I am currently paying about $183/month for a Yellow Pages display ad, and feel it is BY FAR my least productive advertising. I know others feel it is their best form of advertising.

Also, I did print ads in two different local weeklies. (after about five months I ran a 1 month special that was different in each paper. One yielded results, the other yielded 0! I dropped the zero one.

A couple of years ago I read that you should advertise at 7% - 10% of the revenue you WANT to achieve. (NOTE, not the revenue you have now!) I feel that is high for my shop and my area. But, the key is you WILL have to experiment.

[David W]

John, Thanks for the advice on the parking situation. It is something we took into consideration, it's not terrible and I'm hoping not too much of an issue. There is often a spot right out front, but also a back lot that I'll need to bring attention to(not that noticeable from the street). Suppliers can pull right up to the back door, but yes, I'll have to try and pull some strings to get some reserved parking. It's probably not the perfect spot, but very little became available in the 6 months or so that we looked, which I hope is a good sign. Jay if you checked out the demographics in Brunswick it's a bit deceiving, the surrounding area has a lot of people, and seems to be growing as people move up from Portland and Boston. There are two frame shops(none on Maine st.) and I hope there's room for one more, but how do you really know? Good luck in your search and I would highly reccomend Mark Bluestone's "What I need to Know.." class. I took it after I had negotiated my lease and realized I should have made many more requests. I'm spending more than I wanted to on rennovation partly because I had to undo what was there from the previous business, a tuxedo shop with dressing rooms. I thought I could turn them into storage units before realizing how stupid an idea that was. If you know any real estate attorneys have them take a look at your lease. I didn't realize how common it is to negotiate in a commercial lease. Oh well, live and learn, I'll be more prepared next time.

[Jay H]

If I may ask: what exactly did you get changed and what would you have also had changed on your lease?

[Kathy B]

Random thoughts about Marketing 101:
Plan two approaches: one for marketing, one for advertising. Develop a plan that encompasses frequency and reach...the biggest bang and that may not be print advertising.

An all-encompassing program will include press releases, direct mail (postcards), perhaps outdoor (bus benches, billboards, bus panels). Must have: thank you notes that you write to every single person who helps you along the way...and to every customer. When you plan your advertising strategy, do utilize the talents of a professional graphic designer who can create a look for all your promotional materials so that there is consistency in everything you do. This is critical: each piece of collateral should have the same color scheme, 'voice', and feel.

A strategic partnership with a Realtor, mortgage broker, or anyone aggresively marketing is excellent and cheap. Welcome Wagon type stuff, too. Donate to silent auction/fundraisers to get the word out. Get 'em in the door. Establish a referral thank you for customers who bring you new customers. How about Frequent Framer points?

After a framing job is complete, send the client not only a thank you note but a 'report card' so that he/she may grade you. Ask what other services could be offered.

Have a workshop about creative framing and invite groups to come. Offer your self as a speaker to clubs and groups.

And that's just the beginning! Good luck!

Kathy

[JRB]

David, don't beat yourself up too much for not negotiating.

If your store has been empty for a while, six months or more, then you could probably have done some serious negotiating. If it has only been empty a short while, then no, you probably didn't give up very much by not trying to negotiate.

When your dealing with $1000.00 per month, or thereabouts commercial freestanding rentals, you are not going to get very much thrown in anyway.

If your going into a strip mall, thats a different story all together. You can usually negotiate quite a bit with the mall owner, IF you are giving them a substantial lease, ten years or more. You can get free signs, remodeling, carpets, paint. You can also usually get from thirty to ninety days set up time, free rent.

Don't fool yourself though, it is not actually free. The cost of all these "deals" are usually worked into the cost of the lease. All you are really doing is getting a long term loan from your new landlord.

John

[Bob Carter]

John is most correct, as usual. And I wll add to his point by saying that any landlord that os offering a lot of concessions is doing so only because the property is not as desirable.

If it's a great location, they usually don't need to offer a lot of freebies. The more they offer, the more skeptical I would be as to how desirable the location really is

[David W]

Well that's very refreshing to hear. I do feel lucky to be in the space, the landlord I like very much, and it seemed there was a fine line between being a desirable tennant or a pushy one. I wasn't able to get any free set up time which I could have used, but she has consented to any changes made. Thanks for the replies