Sunday, November 16, 2014

"The reason small businesses are disappearing"

That's the title of a long and very interesting thread on Reddit.  Here's part of the opening post.

Now i want to start out by saying that i am a 27 year old male with a small business in Sacramento CA. I started this business a few years ago with savings of 15k. With a lot of hard work and determination i have succeeded, but it sure as hell was not easy. I am a long time lurker and have never seen anyone go in depth about what its like to own a small business and the reason why they are disappearing. Without going into to much detail, i own a furniture store so obviously things are different then other businesses but a lot of the things are the same. I wanted to begin with the things that are killing small businesses. Also only my opinion.

Permits and Licensing - In opening my specific business the first year totaled about $2000.00.

Street Advertising - While this used to be a good portion of how you get business it is now off limits. Code enforcement will not allow you to put anything outside. No balloons, signs, anything with your store name, window paint more than 50%, or any mattresses. Also delivery vehicles can not be closer than 50 feet from the curb. In my case that means behind the building.

Merchant Fees - This is for credit card processing machines. The machine itself costs 600.00 plus the percentages on sales and cards. Companies such as BofA charge once a year on top of the regular fees $150.00 to protect you from fraud (which they can't even stop) and yes its mandatory. Paypal or Square seem to be the best options these days.

Fire Department - Yes even the Fire Department wants a piece. Starting last year you must do your own visual inspection and send them a check for 150! Basically if you don't they will come to your store and give you a million violations for wasting there time.

There's more at the link, along with (at the time of writing) 194 responses from readers.  If you're a small business owner or operator, or work at one, or you're interested in why our economy's going to hell in a handbasket, I strongly suggest that you read the entire thread.  It'll open your eyes to the obstacles small businesses face in today's economy.



JMD said...

We live in a very tiny town and each year see more and more small businesses close. The licensing fees are horrendous here and the city keeps wondering why small business close. I think this is a very truthful and accurate assessment of what is happening. Very sad.

The only larger stores are a Walmart Super Center ( :-( ) and a small JC Penney.

Old NFO said...

Fees, fees and more fees, for basically NOTHING! Sigh...

Will said...

Along the same line, had the water heater replaced at the house. Required a PERMIT from the city, even thought installed by a pro. Cost about $150, for a 30 second look by inspector.

c w swanson said...

I own a business in Sacramento as well, and I concur with everything said. As a business, you are seen as little more than a pot of money to reach in and steal from. I could go on and on, but it is indeed a struggle to make much money after all the fees, costs, taxes, etc, are paid. Don't even get me started on how many clients think it's a-ok to delay paying your bill until you are screaming at them. Ugh, one would have a much easier life with a boring but predictable state job, from which you could retire at 55 with 80 or 90% if your highest pay and lifetime medical for you and your spouse.

c w swanson said...

Another case in point. Up at South Lake Tahoe, a home owners well went dry, so she had to connect to the water main at the street. That cost 3000. The permit from the authorities cost 9000. Insane.

Anonymous said...

"Basically if you don't they will come to your store and give you a million violations for wasting there time."

A business owner that does not know the difference in "there", "their" and "they're" won't be in business long.

California public education on display?