Stupid Question About Closing....

Business By Michelle104 Updated 2 Dec 2010 , 6:22pm by sari66

Michelle104 Posted 28 Nov 2010 , 7:14pm
post #1 of 16

Have any of you on here had to close your business for lack of funds? I've been open for a little over a year and am out of money. A little business on the horizon but not enough to pay the bills. Do you just close the doors? Do you file bankruptcy? What's the process? Not completely positive this is the step I will take (discussing options with DH) but I am just trying to figure out how and what to do...any help or advice would be greatly appreciated. Thank you.

15 replies
CWR41 Posted 28 Nov 2010 , 7:44pm
post #2 of 16

You shouldn't just close the doors if your customer base has value. You could contact a business broker... they would have their list of interested buyers who could buy you out.

If you wanted to supply the link to your website or list the city where your storefront location is, perhaps someone on CC would be interested.

(a broker would let you sell to your own prospects that are named during the process.)

-K8memphis Posted 28 Nov 2010 , 8:25pm
post #3 of 16

I just wanna say I'm sorry it din work out.

(((hug)))

johnson6ofus Posted 28 Nov 2010 , 8:50pm
post #4 of 16

step 1--- add up debts, and add up assets. That gives you a starting point (yes- "goodwill" or your good business name is an asset that someone may buy.). Do you have a storefront, business rents, outstanding business debts? Know where you are, is the first step in deciding the next step.

It is tough--- I am so sorry for you. icon_cry.gif

jillmakescakes Posted 28 Nov 2010 , 10:36pm
post #5 of 16

I'd suggest sending a PM to IndyDebi. She closed her business almost a year ago, different reasons, but same process.

Aside from looking into someone buying the business, what about taking on a partner? Might it be possible that there is a decorator in your area who might want to take over the business, but maybe keep you on?

Also, you mentioned you've been open for a year.... what were your figures like for the year? is this just a tough time of year (i know it is for me, to) or has this been a consistent issue for the whole year?

ColinLeger Posted 28 Nov 2010 , 10:59pm
post #6 of 16

I was just on your website. We've also been in business for one year and things are NOT easy for us either. We don't have a 'store front, we had actually converted a 10x12 dining room into a second kitchen. Second kitchen required by our province of NB (aka state). This summer we spend some time looking for a bigger location and possibably a storefront. A local party planner wanted to share space with us so we looked at the possibilities and crunch the numbers... we never went through with it. We're looking at finishing the basement instead. Cost for the first kitchen were about $1500, basement would be about an extra 2-3500. a building we found was 90,000, rent... well that ranged from 400 to 900. That's a lot of cakes and cupcakes whatever your markup is.

I know this doesn't help much but you might still be able to salvage your business buy finding another location. Do it from home, find a local kitchen that you could rent out. Your site had awesome photos, it's not the talent you're missing.

The biggest thing you must remember is that you can have no regrets about giving it a shot! Learn from this, maybe the timing just wasn't right.

jason_kraft Posted 29 Nov 2010 , 12:09am
post #7 of 16

If you scale back and close the retail shop, you should be able to keep the business running by appointment only, either from your home kitchen (if that's allowed in your state) or a rental kitchen. In either case you should have very little fixed overhead cost.

There's no need to declare bankruptcy unless you have debts you cannot repay, if you want to close up shop you can just liquidate the business. The process for doing this varies depending on what kind of company you have set up.

Michelle104 Posted 29 Nov 2010 , 4:53am
post #8 of 16

I have a sole proprietorship. I started with just enough money to buy the equipment that I needed and it's been pretty much self supportive. I had an accountant and continually asked her opinion about the numbers she was seeing and never really got any conclusive answers. I made some stupid decisions in the early spring and hired some help and overpaid them. I felt like that was ok since I could pay them and pay the bills. That was ok for several months but things have been going downhill since about July. I fired the accountant and decided to take care of things on my own. Have since laid off both employees which I have to say was one of the suckiest things I've ever had to do. We have 4 children from 14 to 3. When I opened the shop I really was doing it for my family. To help to teach my kids work ethic and pride in what they do. Plus to hopefully take some of the burden off of DH. I definitely didn't expect to make a profit but counted myself lucky to be able to just support the business with what I brought in. I feel like I'm at the end of my rope and am just not sure where to go from here. Thank you all for your encouragement and ideas of how to handle this. I really do appreciate the responses. Sorry about all the rambling.....

Michelle104 Posted 2 Dec 2010 , 4:15am
post #9 of 16

cwr41....how do I go about finding a business broeker? Is it just like finding a real estate agent or something along those lines? Also, is there somewhere on here that I could list my business for sale or the contents at least? How do you liquidate???? Sorry if these are stupid questions.. icon_redface.gif

CWR41 Posted 2 Dec 2010 , 5:06am
post #10 of 16
Quote:
Originally Posted by Michelle104

cwr41....how do I go about finding a business broeker? Is it just like finding a real estate agent or something along those lines?




If you google "Business brokers Missouri" you'll get 314,000 results (keep in mind that most of those are going to be food dealers/suppliers, so you need to narrow your search to your specific area and weed out the supply companies).

I still think: If you wanted to supply the link to your website or list the city where your storefront location is, perhaps someone on CC would be interested.

If you'd prefer to not do that, maybe you can make a list of equipment and supplies that you are considering selling to make it easy to forward to those interested who might start emailing you for more information at the email address that you've provided in your profile (whether it's allowed or not, be prepared for inquiries since the word is out!).

Good luck and keep us updated on your decisions.

mombabytiger Posted 2 Dec 2010 , 1:14pm
post #11 of 16

Michelle - NEVER feel bad because you took a risk and followed your dream. Your children will remember that their mom had the guts to do something most people are terrified of. Don't give up unless you absolutely have to. Try to find some solutions, change focus, whatever. And if you do have to give it up, don't blame yourself. Really. thumbs_up.gif

Michelle104 Posted 2 Dec 2010 , 1:16pm
post #12 of 16

my website is mysweetmomentscakery.com

I am located in Crystal City Missouri, about 35 miles south of St. Louis if anyone's interested.

indydebi Posted 2 Dec 2010 , 1:16pm
post #13 of 16
Quote:
Originally Posted by mombabytiger

Michelle - NEVER feel bad because you took a risk and followed your dream. Your children will remember that their mom had the guts to do something most people are terrified of. Don't give up unless you absolutely have to. Try to find some solutions, change focus, whatever. And if you do have to give it up, don't blame yourself. Really. thumbs_up.gif


great comment. My kids say this all the time. They marvel that "at mom's age, she's always trying something new!"

As the song says .... "Dont' stop.... believin'.....!"

CWR41 Posted 2 Dec 2010 , 2:51pm
post #14 of 16

Thanks for posting your website... your cakes are really nice, and your storefront is appealing. The community will certainly miss you if you close, but won't you really miss the community and the creative job that you've made for yourself?

Perhaps if you reconsidered closing and raised your prices instead, would it solve the problems? I'd imagine you could increase your prices $1.50 per serving on your BC cakes, $1.50 per serving on your fondant cakes, and $1.50 per serving on your sculpted cakes (or more on all)... what do you think? Would the area support the higher prices? (maybe it wouldn't hurt to give it a try to see if it solves your profit problems.)

I need to reread your original post to see if there are more concerns. Good luck to you with your decisions.

CWR41 Posted 2 Dec 2010 , 3:35pm
post #15 of 16

After reviewing your original questions, I have a few comments and questions of my own...

Could you find an investor, or get a loan?

Do you have too many employees or not enough? (I don't know how fast you are, how busy you are, if you can get by without help, or if you need additional help so that you're able to take on more business or keep longer hours, etc.)

You're located on a cobblestone historic street (possibly with lots of foot traffic), but you only offer products for walk-in customers on Cupcake Wednesdays? (you might be missing your greatest opportunity if Wednesdays have been your greatest profit days.)

I see your Saturday hours are from 8:30 am - 12 pm... wouldn't that be the busiest day for foot traffic? (I understand if you're closed at noon to deliver wedding cakes, but wouldn't it be profitable to be open all day and have someone else running the store or someone else doing deliveries?)

sari66 Posted 2 Dec 2010 , 6:22pm
post #16 of 16

You have beautiful cakes and as another poster stated have you tried upping your prices? If you area doesn't support it or you're inline with others of your talent then try offering something they don't. Are you doing well with your cupcake Wed? if so maybe have them available other days. I'm sorry you had to let your staff go in such a stinky economy but did you really need all of them? If you're really busy during holiday times then hire help otherwise you may be your only staff outside of family.
Good luck

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