La Verne Magazine
Spring 1998

"La Verne's Small-Town Businesses"


In Search of Business Success:
One Student's Journey to Start a Business in La Verne

by Michael Anklin

 

The west was won by independent, self-sufficient, brave men and women. Well, times have changed, and the west is not so wild anymore; rules and regulations have replaced smoking Colts.

Accompany me, when I, in true pioneer spirit, seek to conquer new ground and try to establish my own place. To honor my Swiss heritage, I wish to open a Swiss specialities restaurant in La Verne. Dishes like "Fondue" (melted cheese eaten out of a pan with bread), Roesti (diced potatoes with onions and bacon) and, of course, Swiss chocolate as a dessert, could cast their magic spell on downtown La Verne.

But hold on; here comes the reality check. Establishing a business does not necessarily go as smoothly as Swiss chocolate melts.

According to Dr. Ahmed Ispahani, professor of business administration and economics at the University of La Verne and former senior adviser to the Shah of Iran, millions of businesses go bankrupt every year because the owners are not prepared.

"Anyone can get a business license from the city," Dr. Ispahani says. "The three most important ingredients of having a business are selecting a location, selecting a location and selecting a location," he emphasizes. You could be well prepared and have good financing, but if your business is in the wrong place, you will never be successful.

Indeed, to get a business license in the first place, one has to come up with a location and present it to City Hall. If the Planning Department approves of the business in the location's particular zone, one is ready to take the next step. But money is needed -- lots of it.

According to Dr. Ispahani, though, banks are reluctant to give loans without any security to back the loan. My TV and my roommate's stereo are probably not going to be enough.

If you are in the same situation, don't despair; there is hope. The Small Business Development Center in Pomona is an organization that helps small entrepreneurs gain loans.

The director of the center, Toni Valdez, says the organization offers two-hour orientations weekly. It provides the future business people with generic information and arranges appointments with a consultant.

"Our services are free of charge," Valdez says. "We are a joint economic development project between small business administrations, the California Trading Commerce Agency and Mount San Antonio College,"she says.

In 1997, the center provided 9,000 hours of counseling to more than 1,700 clients. "We trained more than 3,100 individuals and were able to track 387 jobs created and 379 jobs retained due to our services," Valdez says.

The Center could observe an economic diffusion of $6,374,839 as a result of its services-which means the businesses improved and made millions more than the previous year.

Big bucks are not made easily, however. Once one has the money, one has to know how to handle it. Dr. Ispahani advises one to hire an accountant if one has no knowledge of bookkeeping. One could also "out source" it, which means paying an accountant to take care of it. These people usually do a very good job, says Dr. Ispahani.

Who is going to buy what is being offered, though? One has to make sure that distribution channels for the products are available. What if you disappoint your customers? Whom are they going to run to? How many competitors are in your area?

Why should they come to you? Well, there is no business like show business, and advertising and marketing are very important in the land of the free. "Small business has an extremely important role in America," Dr. Ispahani says. "It is the backbone of the American society. There are more small than large businesses."

Lloyd Cox owns one of those small businesses in La Verne. In July 1997, he started Caffe ala Mode, a coffee, ice cream and sandwich shop on Bonita Avenue.

Those who want to start their own business should listen to Lloyd; he has been there and done that.

"I started out with not only a dream but a concept," Cox says. This is not to discourage future business owners, but those who think they can do it all by themselves should think again. "You got to have money. Geez, I had $10,000 to start. It was nowhere near enough," he says.

Cox got another $10,000 from his mom. "What I learned that was important was getting guidance and the support of an accountant. Without the community support, I wouldn't have gotten anywhere."

The community also provides some competition, however. The owner of Warehouse Pizza, Kenny Schonfeld, is not going to open up Roxy's, a Mexican Restaurant, in the near future just for the fun of it.

A pizza place was going to be opened in the Old Town Square building. When Schonfeld heard of the potential competition, he simply bought the building, which was owned by a friend of his who was thinking about selling it anyway (see Page 28). Schonfeld says, "It's better to compete with myself, and there is a niche for Mexican Food in La Verne."

Schonfeld also owns the Warehouse Pizza building. He says the advantage of owning his own building is that "I always know what my expenses are. "With a lease, you never know what is going to happen."

The business owners seem to agree that it is not much of a hassle to get a business license from the city. That is, as long as one plays by the rules. If the Planning Department doesn't want one to open a certain business in a certain zone, the Department is not going to provide the license.

Once Cox had followed those rules successfully, it took him about three months to actually open up. It normally takes about two years for a business to make any real profit, he says.

He needs to make a few $100 a days to keep going and to pay his rent, which is $1,000 a month, he says. Somebody has to help one make that money. "Don't hire anyone who doesn't know [things] you don't know. It's like the blind leading the blind," Cox says. "There are no particular ways of doing it,"Cox says. The important thing is to do it; it is not going to happen by itself."

So here I am, trying to open my business. I have the most important thing-a location. There is space available in the Old Town Square building -- 200 square feet for $2,500 a month. Since I am not going to open a pizza place, I should get the space. Once I have it, I'll get the business license.

But wait, business is all about supply and demand, isn't it? My friends on campus, especially my European friends, agree that a European restaurant is needed in the La Verne community.

My rich grandmother, who is a master when it comes to European cooking, has agreed to support me financially. Now, I'm all set. There is one small, important detail left, however. I am not an American citizen, but an international student at the University of La Verne, and I do not have a work permit. Well, there goes my dream. But to those out there who can make it happen, good luck.


Students' Choice

Do you want to start your own business in downtown La Verne? You will have to know what is likely to succeed near the University. Here are some University of La Verne students' ideas:

1. A "cool" coffee shop, which is open longer at night, especially on the weekends.

2. A bar with an atmosphere directed toward young people.

3. A pool hall.

4. A record store.

5. A 24-hour (fast) food place.

6. A computer store.

7. A old-fashioned grocery store that offers fresh food.

8. A car rental facility.

9. A public storage place.

10. A pharmacy.



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