It’s one of the toughest decisions an entrepreneur has to make: When is it time to close your business?
With a tough economy and declines in consumer spending, some small businesses are experiencing challenges they are unable to overcome.
We asked two local retail shops that are closing about what led them to that decision, how they’re dealing with the change, what’s next and what they learned from the experience.
Gotta Have It
Five years ago, Mary Burns opened Gotta Have It, a chic shop in Mukilteo. The store specializes in fine gifts and home decor.
She located her business in the Harbour Pointe area of Mukilteo in The Village where there was a clustering of small restaurants and other one-of-a-kind shops.
She thought her store, and two others located nearby — Vintage Peddler, another gift and home decor shop specializing in antique items, and a local yarn shop, Let It Rain — would provide the destination shopping that shoppers who were weary of malls would enjoy.
As summer draws to a close, Let It Rain has closed and the Vintage Peddler and Gotta Have It are in the process of finalizing their sales. They are discounting their inventory at 40 percent and closing their businesses.
Burns said one of her key challenges was the economy. Her store specializes in gifts and luxury items — a tougher sell during an economic slowdown. In the past four years, every time the Boeing Co. had a strike or didn’t get the last government contract, she would notice the drop in her sales.
Another problem was inventory.
Burns’ inventory was so large that it required a much greater financial commitment than she originally planned. She noted that most small retail stores need to plan on reinvesting all profits to the business’s inventory for the first five years in order to be successful.
Running the business itself took a huge commitment. As the sole owner and employee of her company, so she did everything and was in the shop for all store hours.
Burns now plans to look for employment with a large retailer as a merchandise display designer. She looks forward to a regular work week schedule, which will be fewer hours than a business owner puts in.
Vintage Peddler
Burns said she struggled with her location, a challenge she shared with the Vintage Peddler, located across the street.
Kim Baxter, owner of Vintage Peddler with her husband Ron, said that the neighborhood setting lacked signage to draw in customers from the Mukilteo Speedway. Baxter and Burns believe that many shoppers drive by on the way to the mall, not realizing they were there.
The Baxters did use the Web to try to generate additional sales for their business, which mixes new and used items for sale.
In fact, many of their larger sales and estate sales were done via Craigslist. They combined online technology with their quaint storefront. Unfortunately, that wasn’t enough. Marketing and advertising was a very tough aspect of the business.
Kim Baxter plans to return to her teaching career and her husband has maintained his full-time job while working on their business together. Both are looking forward to more free time and less worries about their business, but they loved the experience and making friends with many of their customers and the creativity of owning their own business.
Pat Sisneros is the associate vice president of administration at Everett Community College. Lynne Munoz is the interim dean of EvCC’s Business and Applied Technology Division. Please send your comments to entrepreneurship@everettcc.edu.
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