Seminar Aimed at Keeping Shopkeepers in Business : Merchants Offered Tips on Beating the Odds

Eight weeks ago, Ellie Brooks mortgaged her home to launch her Canoga Park flower shop and quickly discovered that opening a new business was like opening a can of worms.

In short order, Brooks said, she found herself up against tightfisted bankers who would not allow her to accept charge-card business, hard-nosed utility companies that demanded surprisingly high upfront cash deposits, shady suppliers, advertising scam artists and an electrician who almost burned down her new Victory Boulevard store.

“These are things you never expect,� Brooks said. “When you’re new, there’s no one you can turn to for advice when you come up against some of these things.�

So Brooks showed up with plenty of questions Monday night as the Woodland Hills Chamber of Commerce initiated a weekly symposium for West Valley merchants struggling to get healthy--or to stay that way.

Avoiding Pitfalls

Billed as the first Valley effort of its kind, the continuing Monday night sessions are designed to steer shopkeepers around the pitfalls that nationally kill off nine of 10 new businesses.

“That’s a frightening statistic. But starting a new business is so capital intense that the vast majority of little mom-and-pop companies can’t get over the third-year hump point,� said Jerry Garner, an assistant Los Angeles district director for the Small Business Administration.

The free Woodland Hills seminars will give business owners “a place they can come to on a regular basis to discuss common problems and listen to speakers covering bread-and-butter topics,� said John H. Craig III, a Canoga Park lawyer who initiated the program for the 800-member Woodland Hills business group.

Although other business groups occasionally stage programs aimed at owners of small businesses, the West Valley program is the first to be targeted at local problems on a weekly basis, Craig said.

“We’re not looking for national stars as speakers, but local people who can share important information with local business people.�

Monday’s talk by Ernie Lipton, manager of the Robinson’s department store in Woodland Hills, focused on ways of coping with post-Christmas sales slump.

Future Topics

Topics at future meetings, to be held from 5:30 to 7 p.m. Mondays at the Woodland Cottage restaurant, 21335 Ventura Blvd., will include such issues as use of local part-time help and ways of finding “friendly� bankers.

Lipton’s message was reassuring to Brooks, who was dismayed when business slacked off last week at her fledgling Warner Center Flowers & Gifts shop.

“Being able to commiserate with someone about dead business was so good. I didn’t feel so bad,� said the 44-year-old businesswoman, who quit a longtime insurance company job to open the flower shop as her first-ever business venture.

“Until you know someone to talk to, you’re reluctant to pick up the phone and call strangers for advice,� she said. “You don’t want to appear stupid. You need someone you can trust to talk to--someone who’ll speak in the same language.�

Brooks said she found that out when she signed up with a advertising salesman who promised to circulate coupons for her store in Woodland Hills. She said she stopped payment on her check when she found out that the Warner Center office building she had paid to advertise in is not yet completely occupied.

A closer call came when she picked an electrician at random to install lighting in her 900-square-foot shop. The rewiring done by the man was dangerously improper, a second electrician said when he showed up to help install new flower coolers.

“Where to turn to get a reliable handyman? We’re just lucky we were saved from disaster,� Brooks said.

Brooks’ husband and business partner, Sid, helped save her from early financial disaster when he tracked down a banker who would accept charge cards after several other banks refused to handle the shop’s credit card transactions. They cited policies that require shops to be in business for a year before such transactions are accepted, she said.

Other early scrapes involved suppliers “who tried to take advantage of us because we were new� and utility companies that demanded hundreds of dollars in hookup deposits.

“Our personal credit didn’t mean anything,� she said. “The fact that we’d been residential customers for years in Woodland Hills didn’t mean anything. I guess they’ve been stiffed by so many guys who have failed in business.�

Because of such unanticipated costs, her new store cost about $15,000 to open instead of the $12,000 she and her husband had budgeted, she said.

“I know that many new stores close. But I figure I can be a better businesswoman than most. That’s not to say there’s not a hole in the pit of my stomach; there is,� she said. “But there have to be a jillion short cuts out there for me to take. If I spend money needlessly, I can’t buy inventory. And, without inventory, I won’t make a profit.�

Seminar founder Craig agreed. “There are all kinds of ways to run a business. But if you can handle the bread-and-butter basics the right way, you’re gonna make a buck,� he predicted.