Start My Own Business

What new business would you start and why?
What are the steps you would take?
What type of accounting system would you use and why is it important?
What are the pros and cons of owning your own business? Americans enjoy various entertainment places, such as beer bars, music bars, sports bars, gay bars, lesbian bars, etc. Coming from another country, I had hard time finding a quiet place where I didn’t have to raise my voice to conduct informal communications with my friends or with somebody important while enjoying a cup of fresh green leaf tea. I believe there are tea bars in New York or California where Asian people reside, and I heard that there is one in Miami, but there is nothing in Ft Lauderdale, where I live. Luckily, we have Starbuck Cafe, which is close to the environment I am looking for; however, it is still a fast food industry, where people come to grab a cup of coffee and go. Others, like me, try hard to find a quiet corner in all the noise. I miss the times that I spent with my friends in the tea bars in my country. So, I dream of having a tea bar here, where it provides a peaceful place for people to enjoy a calm chat while having a cup of quality tea, and a little relaxing time for themselves. Americans could realize the potential of slowing down and smelling the roses. The economic slowdown might be that opportunity for people to slow down and enjoy a cup of hot tea that they have to drink carefully and slowly fully appreciate the beautiful tea leaves and flowers are works of art floating in a cup of clear water.

Oriental teas are not the teas that Americans understand. Although Starbuck Cafe has a good collection of worldwide teas, such as Earl Grey, Africa Red Bush and Indian Spicy, they are westernized and flavored instant tea bags. Retail store TEAVANA, has many oriental tea collections of original leaf tea, flower tea and herb tea that I am plan to use in my tea bar, however, there are many other herb teas with functions that decrease the effects of stress, help digestion, lower blood pressure, and, of course, the many teas that help with weight loss.

Before starting the business, I would need a business plan that includes the start-up costs, sales projections, and profit at least for 3 years, determine the break-even point, finance plan, sales demographics, and marketing segmentation. I need to decide what form of business organization structure and what accounting method to be used. Most importantly, I must create a plan on how to market my business. My biggest cost would be to lease the space. Location is the most important concern for the success of this business. A high-end location would be good for a classic tea bar, which must attract my target customers. They will include business people who look for a quite place to meet customers, young romantic couples who want to have a private place intimate chats, retired elders who enjoy an afternoon of teas and snacks. Downtown Ft Lauderdale or the Las Olas area would be my number one choice. My second choice would be along A1A, close to beach hotel area.

To maintain the high-end location and the necessary working capital, I have to obtain financing for this business. A Small business loan would be my first choice. I would apply for a business loan that is specially designed to help women’s business under preferential interest rate. Partners with friends who have capital would be another choice.

The cost of inventory- teas would not be a big concern, because first of all, they are low cost; second, I can get suppliers who will give me a payment terms.

Another concern is the management team. Since I have no food or service area management experience, I need to hire somebody who has the management skills and experience in this area. I can also attempt to partner with someone who has these qualifications so as to reduce risks and maximize the most in operational potentials.

A Limited Liability Corporation would be the best business structure for my tea bar business. Under this format, every partner would have limited liability to business losses to extend of their investment, so nobody would worry about losing their personal property if the business fails. Tax wise, this format will avoid the double taxation that a regular C-corporation has to pay.

The accounting method, I would choose is Activity Based Cost accounting (ABC). This is a more complicated and expensive accounting method compared with more simple methods. Since I am an accounting major and I know how to implement it, and since I will use it from very beginning, there will be no complicated transformation procedure. Another reason I use ABC is that I have many different teas and herbs, and the ABC method would be the best to trace each item’s sales, costs, and profitability. Besides consuming different teas and herbs, this tea bar is a service oriented business. So, the service will be another cost pool, and the ABC method is best to trace overhead costs associated with each order for different items.

This tea bar is not another fast food or beverage business, so its interior decor will be classic. It will be an oriental cultural atmosphere that provides customers with a quiet, peaceful, relaxing, and private environment. The tea utensils will be traditional eastern style. The service people would be also oriental who will offer an eastern kind of softness, and charming manner to the atmosphere. The background music will be classical eastern music.

I have not done market research, but I believe there is a niche for tea bar business. I don’t see a big competition for this business. The key to my success, I think, is marketing. Since I am not really good at marketing, I might need to hire a professional marketing intermediary who would make an efficient and effective marketing program to help me get the business off the ground as quickly as possible. The tone in marketing for this business would not be a new “bar” opening; it is an Art of Tea and a new Culture Exploration. It is also a healthier way to live.

I know that running my own business is a rewarding but also a tough career and life choice. It demands my time and focus. I might not able to make as much money as if I work for somebody else. Once I operate my own business, I would have to take bigger responsibility, not only for myself, but for employees, investors or partners. If the business does not take off like I planned, I may get discouraged. I have to prepare for all kinds of unexpected situations and be strong.

I would rather not do it for making a living, which would put too much pressure on me and push me to rush for a profit. If doing it as a hobby or passion, I would be more flexible and creative. Once the business starts, I would not expect net profit in year one or year two, but be prepared for three years to break even. When I started to see the business take off, I would make it as a franchise business and give other ambitious young people opportunities to duplicate and develop this business. By then I would enjoy much freedom to be my own boss.