I cannot believe we are on episode 18 of the Creative Business Breakdown and celebrating 18 months in our most recent location. Our business has gone through several different transitions and locations over the past few years as an LLC. In today’s episode we are covering a little bit of the history of our physical locations as well as the reasoning behind why we have made the moves/transitions that we have. We also share a few lessons we’ve learned along the way and where we want to put our focus moving forward.
To give you a little history, Rachel and I used to be two different businesses working from two very different locations. Rachel was teaching out of her home while I was traveling to see clients in each of their individual homes. As Rachel’s personal life underwent several changes (i.e. the birth of her first child), I was wasting a great deal of time and energy on the road and working out of my car. Three years ago this February, Rachel and I sat down to discuss how we could more together more functionally and make the most of our time, space, energy, and unique talents.
When we decided to form our LLC, we also took the leap into renting our first space. Our first location was perfect for just the two of us. We were renting a couple of studio rooms within a music store and using a large room within their building occasionally for groups. With this new, set location we were both able able to fill our schedules by adding services and taking on new students. As Rachel and I quickly filled every time slot we had available, our income grew but quickly hit a plateau. There are only so many hours in the day and after filing those hours weren’t able to grow any further. As we looked to our future goals for our business, it quickly became apparent that we would need a larger space that was all our own.
When we were looking to find a new location, there were several things we had on our list of wants/needs. We wanted a location with:
- the opportunity to control/decorate any way we needed.
- a seperate entrance for our clients
- a large sign
- several seperate small rooms
- multi-stall bathrooms
- a waiting area
- a large area for groups
- some sound proofing between walls
- room to grow
- natural light & windows
Being a music therapy business (especially one that works with children) presents its own unique set of challenges that can be a turn off to realtors. When realtors hear that we are musicians they immediately red flag us for being too loud and disruptive to other tenants. We had to be persistent in order to even get a foot in the door and needed to provide a full explanation of what we do and what kind of noise we really make.
As we looked at potential locations, we made a list of our top three. Each location had a special set of circumstances that made it both the perfect location for us but also came with a series of challenges.
Location #1 – Pros: It was a brand new structure in the newest part of our community. It was close to a highway entrance and had ample parking. Because the structure was brand new we could build out the space in whatever way we wanted! Cons: COST. Not only was the rent higher because the property was new, but the cost of simply building out that location was astronomical and would have required a large loan. Also, deciding how to build out a new building can be a daunting task. For us it would have been especially challenging because we had no idea what our business would look like 3 years down the road. The location was also a little too far from the center of town and could be isolating to some of our clients.
Location #2 – Pros: Cost. This property fit perfectly in our budget. It had so many of the features we were looking for including a large group space and a few smaller rooms already set up the way we needed. The location was also more central as well. Cons: This was an older building that would have needed a little more TLC and could have some small structural issues moving forward. While the space was nicely divided, it would have required us to get creative to make the space function exactly the way we needed. The entrance also led to multiple business spaces.
Location #3 – Pros: GREAT LOCATION with awesome visibility and a large sign. There is a separate entrance for our clients and the rooms were all ready set up in a way that we needed. Cons: We were concerned that this space would be too large and possibly out of our budget, but was on the border line. The interior also needed updating, including new carpet and a fresh coat of paint on EVERYTHING!
In the end, we decided on location #3. It has been perfect for us and we have very quickly grown into the space, filling every room several days of the week. We’ve even been afraid that we would outgrow this space. Before signing a contract, we negotiated with the owner regarding updates in order to keep everything within our tight budget. He has always been splendid to work with and covered the cost of new carpet while we repainted the entire interior. 🙂
During the process of looking for and leasing a property, we learned several lessons that we shared throughout the episode:
- Patience is so important. New properties come on the market every day!! It is ok to take your time and wait for the right fit for you.
- Location is everything! We have gotten so many comments from the families we work with regarding how convenient our location is.
- Having a separate entrance where clients can walk in the door, know where they are going, and feel at home from their first time entering our space was incredibly important to us. Take time to figure out what you (and your clients) value and how that factors into what you need in your space.
- Having a business plan and goals can help inform your decisions when it comes to finding a physical space. We are so lucky that we went with a larger space. We had to have a serious conversation regarding how we wanted to grow. Even though the space we were in felt massive when we moved in, within six months, it felt like we had perfectly settled in and filled every room.
- A coat of paint and the right decor can make a HUGE difference. However, you do not have to go into debt to create the perfect space from day one. Get thrifty, look for deals, and know that you can always upgrade as you grow.
- Make the most of what you have and do what is right for your business. Not every business needs a separate physical location. If driving to client homes is what makes sense for your business then stick with that. Decide what you NEED and what you are ready for before jumping into something that isn’t the right fit for you. When it was just Rachel working by herself, she was most profitable when working out of her own home. What is going to be the most profitable for you?
- Crunch the numbers. What can you afford? Have you taken into account all of the extra little things that you will need? (ex. furniture, shelving, cleaning services, insurance, a sign, advertising, wifi, etc). Are you leasing or buying? Are utilities & maintenance included in your lease? Get specific. Ask all the questions. And plan as much as you can so you know what to expect without getting in over your head.
- It is ok to take out a small loan to open the doors to your business as long as you have a plan to be profitable and be able to pay off that loan and still pay yourself.
- Be ready to walk away and say no. Negotiate in order to get what you need. Know what you want, stick to your guns, and stand your ground. People will try to take advantage of you when creating a contract, especially if they know you are in love with the property/product they are trying to sell you.
- Ask for help! If your forte is not reading contracts/negotiating or if you don’t know the right questions to ask, find someone who will go with you to look at spaces or who will help you work through an agreement. I definitely had my husband take a second walk through of the spaces we were looking at so that we could get a fresh set of eyes and a new perspective. I asked my family and friends for advice and what questions they would ask a realtor. It is always helpful to have an extra person in your corner rooting for you and helping you stay focused on what you really need.
We say it in every episode and mean it from the bottom of our hearts: do what is right for you and your business. Always make your decisions based on what you and your company need in order to help you live the life you want. Take time to ask yourself what you will need moving forward and be patient so you find the perfect solution.
Until Next Time,
Katey & Rachel