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Jeremy wants to leave his office job as a tax inspector to go into business by himself. He is sick of boring work and being stuck indoors. He wants a job with regular hours working five days a week. He wants to be active and has done running in the past but he does not think he will be able to do heavy lifting or lots of manual labour due to a previous injury. Getting home in the evening and having time for his family and pets is important to him.

He is yet to figure out his budget but has checked Seek.co.nz and found four potential options.

Case Study - Running a shop

Jane shares her story of her six-month business adventure.

“I definitely bit off more than I could chew” she says “I became obsessed and it was the only thing that was important. I lost my identity. I was so stressed..”

After attending a short business course at ARA, Jane decided to buy a small cafe. She had done Hospitality at high school and loved it. The cafe she settled on was in Central Wellington and had a bakery as well as a cafe next door.

“I did not see that it could be hard to run two businesses that were so closely related. I see now that that was pretty naïve.”

Before buying the place, she looked over the accounts. But in hindsight she realised that the accounts (which looked good), did not show the businesses operation in the final months. In these final months a competitor had opened down the road selling similar products and services and was too much for her cafe to survive. The previous owner was helpful but blamed Jane for not checking the final accounts. She urges people looking to buy businesses to check the accounts very carefully and talk things over with an accountant before making the big decisions.

Jane found she was spending 12 to 16 hours there a day. The book work took hours and she spent the evenings cleaning and tidying up. There were costs she hadn’t considered like the need for a new bathroom. It was a big job getting a variety of food ready for the cafe/bakery and she did most of it. She can now laugh at the effort she put in one day to make two chocolate cakes only to have them squashed by the box in her car on the way to a customer. “My staff worked hard but I was exhausted because I was doing too much and I took it out on my staff, which I regret.”

In the end Jane was not making much profit and due to unexpected events like two freezers dying, she had to fork out repair costs. Thankfully insurance covered most of it but it was the final straw and Jane sold the business. She reflected that in the end she had broken even but only by putting in more hours than she’d ever be paid for. “This all came at such a personal cost but I have learned a lot.”