Two Months Later -SCORE!

The good news is I've been so busy that blogging has taken a back seat on my agenda of "things to do" since the end of January. The bad news is I'm still uncertain what direction to take my blog in. But let me at least pick up where I left off on January 25th with some really good advice.

...I checked my email. Something I do at least 10 times a day. I find it hard to accept that some business owners I know check their email maybe once a week or less. They would have missed the opportunity that I received back sometime around March of 2009 from Wilmington SCORE.org. It was an open invitation to attend a SCORE awards breakfast at the Landfall Country Club. I didn't know what SCORE was so I clicked the link in the email to their website. It did not take me long to realize this was a valuable invitation and an open door we needed to walk through. (this is where you should pause, click the SCORE link and learn about them) then come back and read on. I went to the breakfast not knowing what to expect and heard three incredible success stories from entrepreneurs who received counseling advice from a SCORE adviser and how that help continued long after they had opened their businesses. I heard from advisers themselves telling why they are volunteers in the organization, giving back to the business community after retiring from successful careers. And I had the opportunity to meet Sara Raleigh, then Wilmington SCORE president and retail professional. Crescent Moon at the time wanted to secure working capital to help get us through the tail end of the recession. We had made all the right adjustments internally, so a little external help seemed the right choice. But our bank wasn't listening or helping. Sara Raleigh agreed immediately to come to our shop for a meeting and assessment. I felt optimistic right then and there. What amazed me is that this meeting was not going to cost us a penny. Every bit of advice, hand-holding, document reviews and planning help wasn't going to cost us a penny. That is invaluable. Sara Raleigh subsequently helped me through 4 months of writing a business plan and marketing plan that ultimately allowed us to secure a "community express" loan from Superior Financial Group (more on SFG in the next post). Sara was a mentor and a tutor and sounding board all in one. I've written a few business plans for others in the past, but writing one for our existing business and not a start up was new for me. The thing about SCORE is that they have several advisers that come from different business backgrounds and can assist small businesses in lots of ways other than BP writing. They are volunteers whose passion is helping others thrive. That the service is free is priceless. I should make note here that SCORE is a resource partner of the Small Business Administration. Wilmington Score has recently joined the social media environment and can be "liked" on Facebook and "followed" on Twitter.

My priceless advice to add to this? Open your email...you never know what you will find there that could take your business to the next level.

The lesson of nothing is constant.

Issuing in 2009 we celebrated a new president and loathed the bailouts to the banks and car companies. One positive and one negative should provide somewhat of a balance, right? The powers that be made economic corrections, the banking system was saved so that they could continue doing what they are in business to do, investing and loaning money, only now they would be more responsible, assess risk better and continue to work with the business community allowing us to get back on balance. Wrong. Balance was not in anyone’s vocabulary, and certainly nothing seemed fair to the millions losing their jobs in the first half of 2009 or to the thousands of small and micro businesses who were having their credit lines and credit limits slashed to practically nothing. Crescent Moon was one. I have to admit I was naïve about why Bank of America who was our business and personal bank, and we the loyal customer who had never had a late payment or much money on the business credit line, would have our credit limits slashed by 90%. The average consumer and worker does not realize that small businesses rely on capital, (usually in the way of credit lines) to fund inventory, make payroll, invest in improvements or expansion for growth. And as long as you are responsible and make your payments on time and pay it back the relationship continues. Uh Uh, not now…they changed the rules. There was no negotiating, the bank’s stock answer was that it was new policy to address the instability of the current economy and they no longer could afford the risk. It was across the board and across all industries. To many it was like cutting our legs off at the knees and asking us to run a marathon through the rest of the recession. I stayed naïve for most of 2009. In relation to how the banks would operate.

Crescent Moon was going to bootstrap it with lean operating strategy and self capital from savings if necessary. We were being responsible and we knew we could survive through 2009 with all things staying constant. But the retail industry continued to track downhill steadily as the months rolled on though. At times it was difficult not to take it personally. I started to question myself on whether we were stocking the right product mix, was our new social media attempts not making an impact; our networking fruitless and my fear of the economy began to overshadow my confidence to run a business. Customers would walk in the shop and make positive comments and walk out. Nothing was constant except for the concern. Mike and I kept talking it over though, we kept placing one foot in front of the other, moving forward each week making small corrections as we found necessary. We even patted each other on the back and celebrated with a business dinner now and then on how better informed we were becoming and how much smarter we were working. Recognizing what you are doing right is as important as addressing what you may be doing wrong!

Sometime around March 2009 I got an email in our inbox that would impact us immensely. Something was changing finally.

Listen and Learn From Others...they really like to help

There we were in November 2008 with only one income. Not the age to collect, not the age to be hired particularly, if we even wanted to be hired somewhere, but with a small successful retail business that we were still rounding the learning curve with. The key word there is successful. We needed to keep it successful.

One of the first things I did was draw on my marketing background and from some very smart people that I had met at a few networking events to realize that there was something to the social networking or “new” marketing as I referred to it. I had explored some, created accounts in some but I was not focused or working any of them. Thanks to people like Gayle Tabor who is part owner of Glynnes Soaps and owner of Biz Buzz Social who sat down with me and helped me understand Twitter and to Action Coach Reggie Shropshire who reinforced the value of these “Free” marketing tools such as Facebook, Merchant Circle, and Twitter for networking and brand building. I’m a good listener and quick learner. My advice is to take every offer of assistance seriously and make time in your already busy business schedule to learn from others.

One of the first things Mike did was look at our expenses. Wow…we needed to give ourselves a military high and tight buzz cut. We were ordering too much art with each artist order. We were using our credit line to seasonal buy in quantity. We had too much on our shelves. We were doing very little true sales projections. Our packaging supplies were over ordered. We agreed to advertising opportunities too readily. We ate out too much. We were buying and giving our logo brand t-shirts away. The list went on… Mike’s advice is list your expenses or print them if you are using a program like Quickbooks and go down the list to see where a change can be made even a small change to start.

For us it was inventory. We were paying for art that might last us 2-3 months on display or in stock on shelves above the shop. We adopted the not so new JIT - Just In Time order philosophy. Each time we had to order we negotiated lower minimum order requirements from our artists and Net 30 terms. We might order more often through the year but we would not be tying up cash and we had a month to sell it before we had to pay for it. From end of year 2008 to end of year 2009 our inventory valuation dropped 37%.

That was a step in the right direction and only one of the steps we took moving into 2009.

Our advice…take some steps in 2011 to continue your success and be open to advice and help from others.

post 3 of It's a new year, it's a new blog...

Our Wake Up Call

year over year change in retail sales, source: census bureau

Looking back is always easy. It’s looking ahead that is tricky when you are a small business that relies on the consumer. But looking back for me is important in assessing what was working and what wasn’t working. 2007 when we purchased our fine hand-crafted glass shop the economy was still strong, though those watching the indicators saw the dominoes shaking in place. Mike and I knew very little about retail and jumped in head first with excitement. We ordered too much and we planned too little. We simply loved selling beautiful art glass, interacting with people and were caught in a high of owning our own business together. Even the beginning of 2008 lulled us down the same path of stocking the shelves, adding artists and not asking what if?

It really took the October 2008 stock market crash to wake us up. That was a good thing actually for us when I look back now. At the time it was devastating. Our comfortable bubble burst. Our savings took the hits of the shattering stock market. Consumers abruptly zippered their wallets and tightened their belts. If we had maintained the same modus operandi at Crescent Moon we surely would not have survived the recessionary period in 2009 and 2010.

Looking back, I can clearly see our weaknesses:

1. Overstocking product – tying up cash
2. Didn’t pay attention to cash flow as closely as we should have
3. No business plan or setting our goals
4. Taking the economy for granted
5. No marketing plan – operating on a hit or miss plan
6. Didn’t understand our client clearly

But we were having fun! Thankfully we both have solid business backgrounds that we could draw from when we finally opened our eyes in the retail reality world.

Looking back, I can clearly see our strengths:

1. Educating ourselves on art glass and techniques of the trade
2. Building solid customer service practices
3. Drawing on our backgrounds in Marketing (me) and Operations (Mike)
4. Attending every free seminar that came our way
5. Willingness to work hard
6. Solid partnership with each other

November 2008 we woke up and put our thinking caps on.

New small business journal started January 10, 2011 - check the archive