Three Card Monty

By Evan Prieskop on October 20, 2006 in Start-Ups

Keep up with Elise and her story of becoming a successful entrepreneur:

Weeks of research behind her, Elise crouches over three disheveled packets of glossy real estate information sheets. She has to choose between three possible future sites for her store.

The first site she found is her dream location. It is a large storefront, right across the road from the college’s main entrance. The unit has 12-foot display windows, 2,000 square feet of floor space, and is surrounded by other stores that, though not in direct competition with her, cater to her exact clientele. Of course, a preliminary discussion with the site’s owner reveals that he would likely require 2,000 dollars per month for rent, plus an as-of-yet unspecified annual adjustment.

The second site is not too far away from the first. It is several streets back from the main road, but still arguably a part of the affectionately labeled “student ghetto”. This site commands an unusually shaped lot at an acute angle created by an oddly-aligned intersection. The freestanding building features a small outdoor area (which Elise has no idea how to use for a clothing store). Also, because the site was once a restaurant, it has full, customer-accessible restrooms and a plethora of kitchen utility hookups (once again, pretty useless to Elise). The site has sat empty for several months and the owner is willing to be quite flexible about lease terms. Initial negotiations implied a deal in the range of 1,600 dollars per month and a three-year lease.

The last site is small but not unattractive. Though more than five miles from the college and therefore Elise’s original conception for the store, this site most recently contained an outlet clothing store. As a result, it already has built in changing rooms, several wall mirrors, and an ideal display window. The store only offers 600 square feet of usable space, but at 1,100 dollars a month, Elise has little to complain about. Finally, unique among the available sites, it has a half-dozen reserved customer parking spaces.

Enthusiasm and idealism draw Elise strongly to the first site. All of her original budgeting projections where built on an assumption that she would be paying around 2,000 dollars per month in rent. Now she is having second thoughts. Her mentor, Dave, speaks constantly about cutting costs out of her budget, especially in the face of her uncertain financing situation. Furthermore, come conversations with other renters on the same block (who also lease from the same owner) reveal a consistent pattern of discontent with his building management style.

After much deliberation, Elise settles on the second site. As odd as some its features are, the site is large enough to do anything she wants with the space. None of the features of the third site quite make up for its distance from the vital walk-in traffic from the campus. No amount of available parking space makes up for not having any customers.

Knowing her floor plan allows Elise to finalize her layouts and start making specific decisions about furniture needs. Now all she needs is the money to pay for it.

Next week: The best things in life…

learn how to make money from your passion

Read some related articles:

If You Cannot Sell It, Give It Away One thing my game store had was space. If fact, we used to boast that we were the largest game store in New Mexico…and we...
Golden Numbers Having been forced to write out her whole business plan, Elise is finding the experience less painful than anticipated. It is really just a series...
Walking Many Paths Keep up with Elise and her story of becoming a successful entrepreneur: What do you Know? Education Just Notes Golden Numbers How Much? Neither Borrower...
What Do You Know…? It is story time. Every Friday I will tell another piece of a growing story centered on one or more fictional young entrepreneurs. Throughout the...