Unique Vending Failure - No fraud
Here is an unusual story, a vending opportunity failure, which did not involve fraud.
WATERLOO --- When Ryan Madison started his business, Arquel Vending, four years ago, he just knew the business would flourish.Black-owned businesses would flock to him as clients, to support one of their own, he figured. Other businesses would follow suit, preferring to have a local vendor's vending machines in their workplaces. Within three years, his business would grow from his first, single bulk machine to 100,000 bulk and snack machines. He would move the business from the basement of his home to its own physical location, and hire employees.
"And after the vending machines, I was going to buy a game room, because there's not really anything for the kids to do," Madison said. "And then I was going to open a restaurant, and then I was going to buy a building ...."
That was the plan. The reality was different.
He hasn't been able to add a new client in eight months. The business has about 100 vending machines, many of which are kept in the basement of his home, where he still runs the business from. The business is making enough money to support itself, but that's all. Madison has started working a second shift job at Ferguson Enterprises, and has started contemplating closing down his vending business.
Well, what went wrong here? Here are some thoughts.
When start-up businesses fail, it's for any number of reasons, said Mike Hahn, senior program manager with the Regional Business Center. Citing a recent study published by US Bank, Hahn cited the most common reasons for failure:--- Not having a well-developed business plan.
--- Overly optimistic about sales and money needed.
--- Entrepreneurs don't recognize or acknowledge their weaknesses, and don't seek help in those areas.
--- Inexperience.
--- Poor at handling or understanding cash flow.
--- Starting out with too little money.
--- Improperly pricing product or service.
--- Poorly marketing the business.
--- Not understanding or ignoring the competition.
--- Focusing or relying too much on one customer.
--- Hiring the wrong people.
--- Micromanaging, or not being able to successfully delegate tasks to employees.
I would also add the obvious: contact the appropriate trade association, in this case NAMA, for some information about how to build a vending business.
