How on Earth do you start a buisness

mxmarks

This is slightly shameful, as I feel a person my age should know...but I have zero idea. Less than zero.

I'm going to just copy/paste what I wrote in the comics thread, but I'd like to open a comics shop. But as I learn more about what it takes and what I need to do, and how to do research, that idea could morph into something else. Basically I'm fed up with job hunting, I'm fed up with the way things are, and I feel like if other people I know can do this, why can't I.

Thanks for any advice.

Alright, really long and random tangent that I will absolutely cross-post in Help/Advice, but thought maybe someone here wouldn't see it there, so here we go!

I've been looking hardcore for a job for about a year now, and the pipe-dream of "jeez, just open a comic shop or something" has inched closer and closer to a viable option over that time. Viable in the sense that my initial grand plan of "go back to school!" is looking sillier and sillier in this day and age. I have an associates degree, 10 years experience in my field, and I can't find anything over $9/hr. Talking with friends, and seeing people in my life with MASTERS degrees in very, very similar situations has made me realize that the cost of going back to school, in loans, would actually be GREATER than the cost of taking out loans to open a business. The debt vs. payoff seems to be roughly the same to me. The chance of finding success also seems to be about the same.

I've been looking more and more online about opening a business in general, since I literally know absolutely nothing. But I feel a lot of people start where I am, so I'm trying not to get discouraged. I know I'm not alone, and I know not every 31 year old in history who was totally lost in life ended up dead and pennyless, so there's absolutely hope I can do this. I'm well aware it's going to be a ton of work - and that's all the advice I seem to find online. "Oh its a horrible thing." "Oh its a ton of work." "Oh all businesses fail." "More specifically, comics are a horrible business and you shouldn't do it." But people DO do it. Because shops exist! And people make a living off of it. Not become millionaires, but spend their life doing something that they enjoy and excel at. So I'm growing tired of every avenue I look to for advice being "Don't do it." Because that's the advice for a lot of things in life right now.

So - with that said! - if anyone at all here knows anything about opening a shop, I'd love to talk about it. PM me if you think it derails too much here. But after yet another day of job searching it's time I really do my due diligence and look into my dream. It's corny, but it's true. I have all the time in the world to pour into this, I just have no idea where to start.

Thank you, and hail HYDRA.

noir_blood

There was a thread not too long ago that a guy started about buying a comic store from a friend of his. You should read over that.

Have you considered moving somewhere else? I don't mean to dissuade you from your dream of owning a comic book store, but like most will tell you, that's a BIG gamble.

Why do you want to open up a store? The answer has to be better than "I want to be my own boss and I like comics." How many stores are in your area right now? Can your location sustain a comic book store? Do you have business/retail experience? Can you use Quickbooks?

If you're serious about this, I recommend starting off by taking some business classes at your local community classes?

ASimPerson

Here's that thread: http://forums.penny-arcade.com/discussion/184990/questions-regarding-buying-out-a-game-store/p1

Jasconius

that guy was buying a business though, not starting a business

There two components to starting a business

1) Obtaining legal status
2) seeding your business with the assets required to Do Shit

1) Obtaining legal status is easy and relatively cheap. I actually just started my own company literally two weeks ago. You can do this on LegalZoom. It cost me $300 to do it in Florida. Every state is different. YMMV

Generally what you want is an LLC. It's the simplest form of business and the best if you plan to be a sole proprietor of the business, meaning no other owners.

With legal status, you are the owner of a company and that company can have assets and bank accounts and liabilities that are separate from yours in every way that is convenient, and as a sole owner you can move cash between the business in yourself fairly easily (STILL NEED TO TRACK IT, BECAUSE TAXES ARE A BITCH)

2) generally what you'll want to do is obtain all the formation paperwork, then go to a bank and start a business bank account. business bank accounts cost money. you create one, put money in it, and that becomes the assets of the business, and you use money from that account to purchase goods for the business. you'll probably need a point of sale and merchant services and I'm sure that people will fall over themselves to hook you up with that, ask your banker

at this point, you have everything required to do business. you can shop commercial real estate, sign a lease, purchase inventory, etc



because you want to start a Real Business with bricks and mortar and (hopefully) daily transactions, you would probably do well to either get some kind of basic accounting training, or hire an accountant, because taxes will be an issue that enters your life in a significant way, as you'll have to write off Tons of Shit

Gabriel_Pitt

I was going to ask if that was Ziac's thread about buying the game store, which, I will mention (if he doesn't drop in himself as he's rather busy these days), he's having a good time running, and is 'only' having to put in 60 or so hours of work a week. :P

mxmarks

Thanks. That's a huge help.

Obviously it's so easy to get overwhelmed, and every time I've visited sba.gov, I end up feeling like there's no way on Earth to comprehend all of this.

But I take a step back, and realize every single business, big or small, started somewhere, and I just have to get through the basics of it. These posts have been more helpful than anything yet in just breaking it down.

I know I have a lot of research to do, but simply typing "How do you start a business" into google is incredibly unhelpful and a ton of scammy "pay me for the 10 secrets of success!" links.

I am actually looking forward to putting 60+ hours a week into this, honestly. I've been out of work so long I just want something to work at, work hard, and pour everything I've got into. It sounds stupid, but seriously I'm so ready to just take pride in my job and work work work. I've just started to decide to channel that energy into working for myself (and for the people that want to come in and buy awesome things at my shop!)

Jasconius

i could be wrong but by and large SBA is probably not going to be for you

if you believe that the path to starting a business is by deciding that "i want to start a business" and then having someone give you free money to do it, I have bad news for you, they already thought of that and their standards are a little higher

MOST SBA loans require evidence that you know what you're doing and are already engaged in operations. again, banker.

mxmarks

Jasconius wrote: »

i could be wrong but by and large SBA is probably not going to be for you

if you believe that the path to starting a business is by deciding that "i want to start a business" and then having someone give you free money to do it, I have bad news for you, they already thought of that and their standards are a little higher

MOST SBA loans require evidence that you know what you're doing and are already engaged in operations. again, banker.

I just went to sba because prior to deciding to ask for some more personal stories and advice, and posting here, I saw it recommended a few places online as a great resource. A lot of "here's what you should know" articles. I've seen nothing about getting a loan from them, and had no idea that was even something they offered.

But learning about where to take a loan from is absolutely something I need to start learning about myself.

Jasconius

as a new business, you will have no credit in the way that a newborn baby has no credit

you generally can't get a loan without collateral or some long record of credit history. the only exception is SBA where they just need to see that you are trying and have a plan to succeed

so in your case, you need collateral. like savings, or a house, or something

without it, it will be pretty tough sledding

for the record, this is why most "comic shops", tend to be in seedy strip malls or generally low rent districts. it's not a business model that is known to inspire confidence in the financial industry

Grunt's Ghosts

I'm very interested in this a I live in a college town that is growing and the closest this place has to a comic store is a poor Books a Million on campus with half a shelf of comics/anime. I even know a great location (used to be a Christian Books Store funny enough) but I've just been bogged by the lack of info on the web.

VeritasVR

One of the key pieces that people sometimes don't consider before they dive into a business is how to make the business profitable. I would create a scenario or model to demonstrate this before considering your own business:

1. Does the money you take in exceed the money you spend, after taxes and all that jazz? By how much? Can you live off this now or eventually?
2. How does your business make itself better than other similar businesses? Location/convenience? Efficiency (low prices?) Some unique service?

Cauld

Write a business plan. Before you invest a lot of money in a business do what research you can to be sure it will be profitable. Make as few assumptions as you can.

Not Mandatory

My advice is:

1. Be ruthless. Make money. That is what business is about. Don't allow people to walk all over you because you are inexperienced.

2. Go down to City Hall and make sure you are on track legally. I...have plans to do this...

3. Realize you are not alone in wanting something better for yourself and working hard for yourself instead of someone else. People do it every day. You could be one of those people if you keep at it. It takes a lot of making things happen on your own without really knowing if it is the right thing to do, but you just have to keep doing it. Plow through. If the court has questions later, you'll have a nice ledger available for them to peruse. Watch a couple episodes of Shark Tank to motivate you in knowing it doesn't take a mastermind to become successful.

CelestialBadger

Do open a shop. Don't open a comic shop. They are notoriously hard to make a profit on. Assess what your town actually wants, and open that.

Pacificstar

I started and ran my own business for the better part of 2 years. Did everything from raising capital to sales and collections calls. Now I'm a financial planning & analysis manager a well funded startup.

1. Create an LLC - legalzoom as mentioned is a great resource
2. Create a bank account. Often, community banks will offer better rates than super large banks like BOA. Shop around and see what your options are.
3. Since your business has no credit history, you may be asked to guarantee credit purchases against either a) hard assets of the business or, b) your personal assets
4. You will need some way to process credit card transactions. A variety of companies offer these services. Everything from Square (the plug into smartphone dongle) to Quicken. Quicken is more expensive than other choices, but the upside is that you can integrate all your transactions into a quickbooks suite and it makes it a LOT easier to track your accounting stuff.
5. Understand the economics of your business. If you don't know your numbers, you don't know your business. PERIOD. This includes setting a monthly budget and tracking yourself against that budget. Knowing your numbers also makes it easier for you to get working capital loans and the like from a bank.
6. The first price a vendor offers you is never the ONLY price they can offer, and is rarely the BEST price they can offer. Negotiate hard.
7. For a company like a comic book store, you need to understand how to manage your cash. How long can you put off paying your bills? I'm not saying go 60 days past due, but even the largest companies rarely pay their bills as soon as they receive them.
8. Location is important, but be careful when signing a lease. It's probably worth hiring an attorney to review whatever lease you're given, you don't want to be trapped in something that is going to fuck you.
9. If you are going to have partners/investors in your business, you need to get an operating agreement together. You can find samples online, and can probably get some kind of stock form from an attorney for a couple hundred bucks.
10. Don't spend money on things in such a way that you don't know the outcome. The most obvious example is marketing. If you're going to spend on marketing, try to include some method to understand how well it worked. That might be including a coupon on direct mailings, so you can count redeemed coupons to get an idea of the efficacy of your campaign.
11. If you're going to have a physical store, make sure it's laid out in such a manner as to be compliant with ADA standards. In states like California there are people that go around suing small businesses that aren't in compliance.

This turned into a stream of consciousness list, sorry about that. Hope it's helpful.

mxmarks

CelestialBadger wrote: »

Do open a shop. Don't open a comic shop. They are notoriously hard to make a profit on. Assess what your town actually wants, and open that.

Yeah, I agree, but that's why I think this is a decent place to open a comic shop. Just from looking around, and going around here, I've never lived in a more comic/gaming friendly environment. I was thinking of maybe just literally going to the mall today and asking random people, gathering data on my own and seeing if there's an interest for a comic shop here. It's very close to 2 colleges and a navy base. There are more GameStops here than anywhere I've ever lived. There was a comic con last month. It seems like theres a market for a shop here.

I don't really have the money to hire someone to do actual research, and a decade of working in TV has made me believe that they're pretty hit or miss anyway. So I may just literally start asking around and seeing what kind of response I get.

Feral

mxmarks wrote: »

CelestialBadger wrote: »

Do open a shop. Don't open a comic shop. They are notoriously hard to make a profit on. Assess what your town actually wants, and open that.

Yeah, I agree, but that's why I think this is a decent place to open a comic shop. Just from looking around, and going around here, I've never lived in a more comic/gaming friendly environment. I was thinking of maybe just literally going to the mall today and asking random people, gathering data on my own and seeing if there's an interest for a comic shop here. It's very close to 2 colleges and a navy base. There are more GameStops here than anywhere I've ever lived. There was a comic con last month. It seems like theres a market for a shop here.

I don't really have the money to hire someone to do actual research, and a decade of working in TV has made me believe that they're pretty hit or miss anyway. So I may just literally start asking around and seeing what kind of response I get.

Are you cool with selling gaming products?

Specifically, are you cool with selling CCGs? Magic, Yu-Gi-Oh, Pokemon?

I know a number of game store & comic store owners and every single one of them sells CCGs as a way to boost margins. It's even better if you have some space where you can fit a few gaming tables.

localh77

One thing to keep in mind, because it's easy to underestimate, is that it costs a fortune to stock a store (any store) initially. You'll have to shell out for tens of thousands in inventory, potentially tens of thousands for leasehold improvements, and more. And that's all before you even open the doors for business. So to open a physical location, you're going to need either a bunch of cash that you can invest in the business, or take out a loan, in which case you'll need a really solid business plan.

zekebeau

Another resource is the local chamber of commerce. It is just a club for business owners, but they often have good ties to the local government and can give advice about permits, banking options, and often just simple advice. Each one varies a lot, but getting some face to face advice can sometimes be a big blessing.

Also, local city hall to double check permitting regulations is big.

As for LLC setting up, it is not always the best option and in some places can be a big expense. (CA has a $800 minimum annual tax just to keep existing, plus many other fees). WORSE, in many states a single person LLC doesn't even give you the creditor protection that is supposedly the big benefit. Sometimes a DBA as a sole proprietorship is the best.

This isn't legal advice, it shouldn't be relied on, no attorney-client relationship has been formed from this communication, etc.

The Ender

I've been looking more and more online about opening a business in general, since I literally know absolutely nothing. But I feel a lot of people start where I am, so I'm trying not to get discouraged. I know I'm not alone, and I know not every 31 year old in history who was totally lost in life ended up dead and pennyless, so there's absolutely hope I can do this. I'm well aware it's going to be a ton of work - and that's all the advice I seem to find online. "Oh its a horrible thing." "Oh its a ton of work." "Oh all businesses fail." "More specifically, comics are a horrible business and you shouldn't do it." But people DO do it. Because shops exist! And people make a living off of it. Not become millionaires, but spend their life doing something that they enjoy and excel at. So I'm growing tired of every avenue I look to for advice being "Don't do it." Because that's the advice for a lot of things in life right now.

It's not a matter of 'DON'T EVER DO THAT!' - it's matter of wanting people to understand the risks involved before they jump into something where they can not only financially damage themselves, but financially ruin themselves for years to come. That's why the advice you will find is couched in extremely cautionary language: they don't want to discourage you or make you feel like you can't accomplish anything, they want to make sure you think really hard & make a concrete plan, so you don't end-up as yet another burned-out would-be entrepreneur.

For example:

Yeah, I agree, but that's why I think this is a decent place to open a comic shop. Just from looking around, and going around here, I've never lived in a more comic/gaming friendly environment. I was thinking of maybe just literally going to the mall today and asking random people, gathering data on my own and seeing if there's an interest for a comic shop here. It's very close to 2 colleges and a navy base. There are more GameStops here than anywhere I've ever lived. There was a comic con last month. It seems like theres a market for a shop here.

Asking random people in a mall if they would shop at a comic shop in the mall is not going to produce a lot of valuable data - in fact, it's probably likely to mislead you.

That's not to say that your area is or isn't a good one for a comic shop, but that you won't get that information with ad hoc surveys. In my opinion, one of the best ways to gauge your market is to try organizing some local events first. See how many people you can reach / how many people show up. If it's possible / reasonable / legal for you to do so, have a small quantity of stuff that is available for sale at your events. How many people actually bought stuff?

This can give you a rough idea of the scope of your market (while also building rapport with your intended customer base).

Liquid Hellz

I see a few people have said start an LLC.. it may not be right for you. Your best advice will come from your accountant. Find a good one and talk to them about what type of corporation may be best for you.