Difficult first year in business?

Question

We opened a discount/dollar store in September. We used all our savings and used a lot of credit for this to try and make a better future for our kids. We were the first store in the plaza and it has been very tough. Things slowly got better and we could pay everything and get new stock (no profit though) and we did well in December for Christmas. But, things are VERY bad now in January. We are behind paying our rent and suppliers this month and can't afford new supplies which isn't good. We hope things will pick up after January so we can get caught up and another store is opening in late February which hopefully will help us out too. Is it normal for the first year and January to be this tough in small business?

Answer 1

its always hard the first 2yrs of a new business,most businesses have a slow period after vthe holidays,it will pick up around the end of feb,and then march u should see more business again..talk to ur ventors they usually will work with u..also u need to cut back on ur expenses during this time...gl

Answer 2

Yes, it is normally difficult for small businesses to launch and get profitable. In fact statistically more than 3/4 fail. As you mentioned, the holiday season was good but as you will find, this is when even major retailers make most of their money. They live for the period from November to December. After that consumers are shop-weary and have to pay off their credit cards. Honestly you have made some classic mistakes in starting your business. You seem to be significantly under-capitalized. Your choice of location also raises questions, i.e. why did you choose a place where you as an unknown entity would be the first and only store instead of choosing a location with proven draw? Hopefully you got significant breaks on your rent for being first. All is not bleak however IF you had the foresight to develop a good business plan/strategy before you ever started, and have a wise marketing strategy to deal with slow sales. If you do not have a business plan, develop one now! There are plenty of helps in this regard so don't despair. I would suggest seeing if there are some small business counselors in your area, e.g. check out a local university business school or look online. There are many experts familiar with your type of business that may give you advice you could not come up with on your own, and many are low-cost or free. For starters now, you could create a website (you can get a fairly inexpensive one) to make your business known and even get online sales. Talk to your suppliers and see about returning items that don't sell, getting better payment terms, and delete (have a sale) on slow movers/dead items from your inventory so you have some working capital. I would also talk with your landlord since you say you are behind. Don't ignore the problem. The landlord may be willing to cut you some slack seeing as you are the only store there. From the landlord's perspective, at least some rent is better than totally vacant premises. What ever you do, don't hock your house to raise money unless you can live with the risk of losing it and winding up on the street.

Answer 3

January is always a slow month for consumers. After Christmas, most people don't have a lot of money to spend, and they have a lot of credit cards to pay off. Things usually pick up in February or March, depending on the nature of business. Hang in there and try to thing of some inexpensive ideas to promote your store. You need to give people an incentive to come in. Good luck and I hope everything works out.

Answer 4

Befopre contemplating opening a business, a person has to sit down and see if they have enough money on hand to cover the first six months of business expenses, money to replenish stock, etc. If you don't have this capital on hands, I would not even consider startring a business. It takes time to get clientele, and if you have no cash reserves to fall back on, the situation is NOT good, to say the least. My prayers and best wishes to you.

Answer 5

we own a tv business, and january is always slow. People are still recovering from the expesive holidays, but tax time i s around t he corner, and VAlentines is always a good time for dollar stores, try to keep it up a little longer. where is your store, i'll advertise a little on my websites.

Answer 6

Well as a bartender (Part owner) of the bar there are slow times but spring is coming and that means BBQ's and out door events it should pick up then, the best times for us is holidays and late summer.

Answer 7

Where's your Dollar store? I'd buy something to help you out.

Answer 8

I will pray all your dreams come true !!!! Good Luck