OWNER’S THOUGHTS ON CLOSING HIS BUSINESS
By JIM KENDALL
This material originally appeared as one of Jim’s Daily Herald columns
At the end, Paul O’Neill went out on his own terms – closing his Run Today store in Glen Ellyn before the financial hit became too big for the self-funded business.
Closing the store “wasn’t an easy thing to do,” O’Neill says. “Do I continue to fight a battle I don’t think I can win or go out on my own terms?” O’Neill agreed to talk about the thought process in closing his seven-year old business in the hope that his experience might be helpful to other entrepreneurs facing a similar decision.
“We probably lost a little from the initial investment, but I don’t feel I failed,” O’Neill says. “The hardest part was closing the door on customers I helped, people we made a difference for.
“We did make a profit, but we had nothing left in the bank. I knew I had to help myself. I had to take care of my family.”
O’Neill knew last summer the business wasn’t working.
“I kept thinking there was something I wasn’t doing (as the business slumped). I had to look at the situation from a business perspective. We were losing customers, and I couldn’t stop the bleeding,” O’Neill says.
In fact, O’Neill did a lot of things right. Run Today, for example, sponsored races and worked with local high schools, but that wasn’t enough.
Unexpected internet competition and a lack of vendor support were the primary culprits in Run Today’s demise, though O’Neill blames neither for the closing.
“I opened right as the internet started to be a player for (running) shoes and apparel,” O’Neill says. “The competition hurt us. It hadn’t been in my mind. I thought the service we provided – making sure people got the correct shoes – would make a difference, but service never entered into the equation.”
Customers would come into O’Neill’s store, take photos of shoes they wanted to buy and go home to buy on the internet. How does O’Neill know the customers’ intent? He asked.
Problem two: Most of the sales reps “stopped coming around. The realization that vendors were focusing in a different direction (other than retail support) was a surprise,” O’Neill says. “We would have benefitted from better terms and more marketing support.”
Ultimately, O’Neill continues, “I went on the vendor sites as a consumer.” That’s when he noticed customers were getting Facebook messages from vendors and that vendor sites had no click-here-to-find-a-store service.
O’Neill does have advice for business owners approaching a close-or-stay-open turning point. The advice is pretty simple:
* Look at your total exposure. Can you manage expenses until your exposure is minimized? Our lease was up and the timing was right, O’Neill says.
* Make certain you understand your relationship with vendors – their plans and what (support) you get.
* Don’t burn any bridges. You never know when you’ll see someone again.
© 2016 Kendall Communications Inc. Follow Jim Kendall on LinkedIn and Twitter. Write him at Jim@kendallcom.com. Listen to Jim’s Business Owners’ Pod Talk at www.kendallcom.com/podcast.