Like many people Jasmine Graham decided to become an entrepreneur after getting laid off, but unlike many of her peers she’s still in business. “I incorporated in 2008,” the former fashion business executive tells EBONY. “[After the layoff] I went went on a few interviews and realized they wanted to pay me less to do more. Then I started asking myself, ‘Are you really going back in?’ My mother suggested that I write down all of things I was passionate about and the top thing was coaching and fitness.” Graham spent the next few months learning how to run an enterprise. She joined professional networks, mastered marketing and created a kick-butt business plan. And when she finally launched her business, she elected to work from home.
“I signed my first space lease in 2012,” says the owner of Pace for Success and Fit Factory NYC, a boutique fitness center. For the initial four years of operation Graham worked from home (her dining room doubled as an office) and shared spaces (she rented an open area in a colleague’s space for indoor classes). She was purposefully patient. “I had a business plan and understood what kind of cash flow I needed to sustain a space for my boot camp and other services,” says Graham. “I also knew I needed to find a broker who understood my business’ needs and respected my budget.”
As a trainer to high-income professionals, Graham, who chose the thriving and trendy neighborhood of Chelsea, New York City for her brick and mortar location, knew having the right address would be a key component to longstanding success. Still, deciding to commit to buying a commercial space or entering into a lease agreement isn’t the right move for every business. Graham, who also mentors small business owners, talks to EBONY about how entrepreneurs can evaluate whether their business can support an upgrade in location. Here are four questions every entrepreneur should ask him or herself before signing on the doted line:
- How Much Money is in the Business’ Bank Account? Entrepreneurs often mingle business and personal funds. But if an owner is considering taking on a commercial space he or she should take inventory of the business’ true revenue and costs. Tally how much money is coming in and out weekly, and determine what is available to cover new expenses that accompany the space such as rent, electricity, water, etc.
- Can You Afford a Lease, Security Deposit and a Build Out? Many entrepreneurs focus on amassing the funds to secure a lease, but many spaces require significant renovations before they can used — and that financial responsibility falls on the leasee. Another hidden cost is the 2-3 months security deposit most landlords require. Other additional expenses include buying the furniture, resources and supplies needed to operate. Create a budget to account for all of these expenses beforehand to ensure you are prepared.
- How is Your Credit? Most entrepreneurs need an infusion of cash at some point and whether that additional financing comes from a bank loan, line of credit or credit card it will require a check of your credit history. Ensure that you’re in a position to succeed by adopting responsible credit habits early on and clearing up an issues that you have.
- Can You Afford Employees? Taking on a brick and mortar space typically requires an increase in staffing (associates, cleaning services, benefits, etc.), and employees must be paid regardless of what the owner is experiencing i.e. late invoices or slow seasons. Make sure you have the financial reserve to float any costs that may arise even if cash flow is compromised.
Follow Jasmine Graham on IG @coachjaz. And find out more about Fit Factory NYC at fitfactorynyc.com.