Name: Steven P Sanderson II

Date: 6/12/06
Class: Intro to Business BA11 5040
Professor: McNamara

I am going to be writing a reaction paper on many of the points that were brought
out in chapter 6 which is entitled Entrepreneurship and Starting a Small Business. The
reason I am writing a paper on this is because I have started and ran small businesses of
my own and find the whole prospect of it quite fascinating. One of the reasons I am
taking this class and going back to school is to help refine what I have already learned on
my own to help my better succeed later on in life when I would like to start another
business. I personally like the empowerment and respect I get when I start a business.
Now since I no longer have a business I feel that I have come away from them with a
new respect for what it takes to run a business. Now I can look back on all of the years I
worked for someone else and realize what they were going through to an extent. Allow
me to tell you about one of the businesses I started with two of my friends which not only
turned out to be the “best ten years of my life but also the worst or most educating” I put
quotes around that part of the sentence for a couple of reasons. One I only owned it for
two years and two the fact that they were the best and worst years of my life to date.

It all came about when I was 22 and myself my roommate and his cousin bought a
bar. Now for someone my age, when I was 22 anyway the thought of buying a bar was
one of the coolest things I could think of. Needless to say I really did not do a whole lot
of thinking. Now I thought I had all of the right things going on. We were able to start a
company and get the necessary financing to get the ball rolling. We were able to obtain
just over $100,000 from the bank – which by the way was extremely difficult, now this
gave us what we needed to put a good faith deposit down on the business and its assets.
Now we thought we had the right mind frames which I still think we did, we were self-
directed, meaning we were comfortable with our decision to buy the business and run it
even if we might fail. This was also a time when we became quite self-nurturing. We
really did not have anyone who believed that we could turn the business around and make
something of it or ourselves with it.

All that being said heads up and away we went. We also thought that we had a
pretty good team together. I was to do all of the backend stuff, my roommate would take
care of marketing the bar and our other partner would take care of staff and customer
service. Sounds like we had it all worked out. Before we actually took possession of the
bar we had somewhat of a rocky start meaning we did not see eye to eye on everything
but shrugged them off like that is just how it is supposed to be, if everyone thought the
same this would truly be a boring world. For us there was nothing better than owning our
own business and especially being a place where everyone we knew would be able to
come hang out and make us a little bit of money. So far it all sounds good. Since we had
purchased a bar that in effect had to sell because it lost a customer base from a bad
incident and really was never able to recover, so he decided to sell and move on. The
person we bought it from has since become a close friend of mine and I still talk to him
on a regular basis. Since we were new to the area and we had a lot of friends between the
three of us it was easy to start a new customer base. This was important to us since we
really had to create a customer base from people in the area. This proved to be difficult.
At the time I was working a full time job that I had been at for 3 years at the time. Since
I would not have been able to quite my job and only work the bar we all kept our jobs and
rotated shifts at the bar. I would work during the day and try to build the day business so
that the bar would pay the bills for the week with what it took in during the day. Working
these shifts meant we had to be able to manage our time very effectively. This was not to
difficult since the full time job I was working was at an automotive shipping company
and I was used to time schedules. Not only did I work there but so did my roommate.
This proved to be one of the stressing factors that caused me to leave the business. We
will get to that later on.

Now when it came down to working within the rules of the city I really did it by
trial and error. When I went online and looked at the rules just for having a sign in front
of the business I felt like it was the never ending story. So I did what I should not have
done but it was cheap so I just rented a mobile sign and parked it in the parking lot so
everyone from the street could see it. Well that did not last very long. It did however last
long enough for me to realize it was very helpful. But I was not in any position to argue
with the city don’t think I would have gotten very far anyway. But this is just one
example of how I did not properly research things which I now understand why I should
have.

I liked the fact that we were a small business at the time. We only had 7
employees but it was a lot of fun, I really never expected that I would have been able to
do something like that before. Now earlier I said that my partners and I had disagreed on
some things that got us off to a rocky start, to me they were big issues and to them they
were small. For example we had bought new speakers and a PA system for the weekend
night times when we would have DJ’s and contests. I personally wanted to spend the
minimal amount getting the already installed system working good and they wanted to
spend $10,000 on a new system which I thought was ludicrous but we did it anyway.
Some things that we did not think of were the fact that there was another bar down the
road, but honestly we did not really think to much of it. When I look on page 186 of our
text book there is a section labeled causes of small business failure and I realize there are
many things on there that we did. When everything got going we really did not have
enough capital, tried to do to much with what we had, and in doing so we put ourselves in
a position that if an unexpected occurrence came by we would have been up a certain
creek without a paddle.

I am not sorry for how we came into business and how things went with it. After
all I would really consider it my greatest successful failure. It was the largest undertaking
that I had ever gone through with and I learned so many invaluable lessons that could
really never be taught from a text book. If I had learned about these things before hand
maybe I would not have made some of the mistakes that I did but I know I would have
made some of them. Another mistake that I made I think was going into business with
someone I not only worked with but was roommates with. It became very easy for us to
get into arguments basically because we were tired of seeing each other. But this is
something I feel is all part of the experience and was part of my real world business
education.

All in all I would have done some things different but most of them I would not
have. I had the time of my life for two years, not only did I have a lot of fun but I
experienced the American Dream, in a smaller sense, but I can honestly say that I did
what I wanted to and had a great time doing it. That being said and why I am back in
school I find that most of the things that I am going over would have helped me quite a
bit and might have made the experience last longer. I say might because if I had know
what I know now or new a lot of the things that we are going over I might have never
gone through with it and that to me would be a terrible experience to waste.