Wednesday, June 12, 2024

Recognizing Small Business Opportunity

I was in a large city in the midwest on vacation with friends and I stumbled upon what would later change my life. As many of you may have done, I got my idea for my small business walking past and going inside another business. While inside, I noticed how many women were in awe by what the store offered and practical applications showed these women how they could have the same thing. I browsed around with my then girlfriend (now wife) and looked at prices and noticed that the everything was so cheap. My initial question was, “How could this store be making any profit?” Then I got to the checkout line and noticed some of the totals! We were in a scrapbook store and I thought that paper could never turn such a profit. That cash register changed my mind.

We returned home an I began to look into the specifics of the business. I called the owner of the store we visited and asked questions and got names of companies to purchase product. I found that a piece of nice scrapbook paper can have a 400% markup and still seem cheap to some (me). When talking pennies, that markup doesn’t seem like much but those pennies add up. The product is not only limited to paper but also to albums, stickers, pens, markers and much more. The markup on those products would be similarly profitable. I found that the market in Cincinnati had four scrap booking stores of similar size and all had been in business for at least two years. All four, when asked, said that business was very good. I noticed that here in Lexington that no such stores existed. This prompted me to talk about starting one of these businesses with some other partners. I discussed the opportunity with the others and decided that this was a business that needed to be started in this area.

The smaller town of Lexington probably did not have the market of a Cincinnati-size town because of the population. This was a thought in the beginning but again, we felt that this business was overdue. We also expected within a couple of years some added competition from a new store in town. That wasn’t a guarantee but it was planned for just in case. Our doors opened and business began by word of mouth. Business was great right from the start and we were able to move to a larger location after only two years.

After being in business for five years, I have recently sold my share of the store. I received all of my initial investment and more. Isn’t that the point of a business? To see what a area needs and provide the solution? If you make a profit, it is a business. Small business provides a large and key role in the economy. Your small business provides the economy that your area needs so you must find the product that your area will need in recession or not. Grant it, a scrap-booking store isn’t a need but when you are the only one in the area, it is a monopoly effect. When you recognize that your area is missing something, don’t hesitate to give it to them because someone will. Recognize the small business opportunity and take advantage.

Full of wit and humor, Brandon White is an entrepreneur and former editor and writer for Murdok, Inc.

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