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40% of California's small businesses died in the last two years

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Re: 40% of California's small businesses died in the last two years

#41

Post by happycube »

anamax wrote: post #17
russdpale wrote: post #2

Not surprising, I see so many downtown areas still closed in the SJ area. It's tough to open a business when the people in the area don't have the money to buy your products. When 2/3rd's of the nation are paycheck to paycheck, even in an affluent area like SJ, if your business is not providing something extremely essential, then you are effectively marketing to just 1/3rd of the population with money. This tautology…

> Not surprising, I see so many downtown areas still closed in the SJ area. It depends. The Mexican restaurants did really well. (They went to outside seating in tents that was much larger than what they had before and are packed.) The Asian restaurants, not so much. It might be a downtown thing more than an Asian/Mexican thing. San Jose has spent hundreds of millions of dollars over the decades trying to create a do…

Yeah, I lived there in the 90's and visited occasionally after and it was struggling then - they opened up a big outdoor mall with a large movie theater... that failed.

It was much easier to build a fake downtown a few miles out (Santana Row) than gentrify^Wdevelop the real one into something successful. And in the noughts it had a Borders while pretty much all that was left of the mall was office space and a Waldenbooks, IIRC...

Re: 40% of California's small businesses died in the last two years

#42

Post by JoeAltmaier »

obviouslynotme wrote: post #25
JoeAltmaier wrote: post #18

The normal rate for small business failure is 20% in the first year. Does 40% in two years seem out of line? Without some normal value, '40% died' is just clickbait.

It's higher than that depending on the industry, but you are assuming that 100% of small businesses started right as the lockdowns hit. Most small businesses that make it past the first couple years last a long time.

{citation}

Re: 40% of California's small businesses died in the last two years

#43

Post by 6bb32646d83d »

listenallyall wrote: post #37
wilkystyle wrote: post #35

Earlier quoted context omitted.

It's almost as if they're friends who talk about things that happen in each others' lives!

Not on this planet. This sounds like how you talk to your accountant, not your friends. You don't burden your friends with details this specific.

I could totally see a friend spending 5mn explaining that his cost has gone up 300% when venting while getting a drink together. I don't understand why you're finding this so unbelievable.

Re: 40% of California's small businesses died in the last two years

#44

Post by _dujt »

londons_explore wrote: post #39

Are these actually real businesses closing, or are they people opening and closing small 'on paper' businesses for tax purposes? There are lots of tax breaks and incentives to open a business... And when it's a few years old and those are gone, it makes sense to wind up the business and do the same again.

There’s a corollary to Betteridge's law of headlines that states “A headline is Clickbait if it contains the word California”.

Re: 40% of California's small businesses died in the last two years

#45

Post by listenallyall »

6bb32646d83d wrote: post #43
listenallyall wrote: post #37

Earlier quoted context omitted.

Not on this planet. This sounds like how you talk to your accountant, not your friends. You don't burden your friends with details this specific.

I could totally see a friend spending 5mn explaining that his cost has gone up 300% when venting while getting a drink together. I don't understand why you're finding this so unbelievable.

You talk to your friends about "total burdened costs"? Or something went up exactly 170%? Not "almost tripled"? Sure.

Re: 40% of California's small businesses died in the last two years

#46

Post by MrWiffles »

eek2121 wrote: post #34
eigenrick wrote: post #19

Earlier quoted context omitted.

> The fact of the matter is most small businesses are crap businesses. > They also abuse their workers in ways big business can't get away with, both illegally and legally. Really? You know this to be a fact? It appears that the only thing you know about small business comes from what you read on /r/antiwork The fact of the matter is that 47% of Americans are employed by small businesses. That percentage keeps droppi…

Funny enough, I'm in a position to be friends with many small business owners (I've done work for them over the years, and it has involved into friendships) The folks that are successful don't look at pennies. They produce or sell their products for a healthy price and focus on delivering a quality experience. I went to dinner with the owner of a small business last week that just closed on 30mm in revenue across 15…

Nailed it.

Not rocket science; focusing on delivering VALUE in exchange for the money you charge has always been the obvious, unsexy, boring, fundamental thing that makes any economy function.

So yeah, it's not surprising your friend has closed over 30mm. Especially if he's treating his employees well (which is what it sounds like, esp. wrt. pension). And there's unsexy rule number 2: you treat the people who do the hard work really well, you pay them well, and you hire accordingly because that translates into an intangible competitive advantage that doesn't lend itself well to quantifiable measurement, but something we all have a word for anyway: OPTIMISM!

It's no secret why these shit-for-pay businesses all over the country are having a hard time filling open hiring reqs; because the pay sucks! And that's usually a fair indicator of how your employer's going to treat you if you join them, too. If they're not willing to pay a reasonable living wage, you can be pretty sure they're also not going to bother making the working environment anything even marginally better than the law requires as an absolute minimum. And frankly that legal bar is far, far too low to begin with (and we're not even talking minimum wage here, just basic human decency is lacking most of the time).

So yeah, kudos to your buddy there. If small businesses want to compete with the big guys, this is how you do it. You don't undercut, you charge fair, you pay better, and you over-deliver.

It's called "hard work", and that's precisely why it's so damn rare.

Re: 40% of California's small businesses died in the last two years

#47

Post by MrWiffles »

listenallyall wrote: post #30
eigenrick wrote: post #19

Earlier quoted context omitted.

> The fact of the matter is most small businesses are crap businesses. > They also abuse their workers in ways big business can't get away with, both illegally and legally. Really? You know this to be a fact? It appears that the only thing you know about small business comes from what you read on /r/antiwork The fact of the matter is that 47% of Americans are employed by small businesses. That percentage keeps droppi…

You sure have a lot of details about your friend's business. Most friends might say, "hey my cost of goods went way up" or "almost doubled". Your friend is oddly specific. And he doesn't have "a bunch of workers" but exactly 8. You must be a very close friend!

Eight is not exactly a difficult number to count up to.

You get all employees in a room and count each one individually and you'll get there in under 5 seconds.

Well, maybe not you, but...

Re: 40% of California's small businesses died in the last two years

#48

Post by MrWiffles »

I just tried to look at the tweet to see where this data's coming from, but "[...] quoth the server: '404'".

But really, forty percent!? For a statistical study that's an unusually convenient/round number, and for a state with the population of California, the chances of that statistic being accurate for any measurement methodology are astronomically small. Sure the dude could've been rounding it, which is totally fine of course, but I also question the validity of that statement because that's nearly half the entire small business segment for the most populous state in the nation!

And that just doesn't sound right, fundamentally. It's possible, sure, but c'mon, really? Near half?! I don't buy it, not without data from well-respected sources to back it up.

So I go to click the link, only to find it no longer exists. Which further casts doubt on this statement.

(18 hours after tweet linked on HN is when I checked Twitter; or in my world, "just now".)

Re: 40% of California's small businesses died in the last two years

#49

Post by larrydag »

MrWiffles wrote: post #48

I just tried to look at the tweet to see where this data's coming from, but "[...] quoth the server: '404'". But really, forty percent!? For a statistical study that's an unusually convenient/round number, and for a state with the population of California, the chances of that statistic being accurate for any measurement methodology are astronomically small. Sure the dude could've been rounding it, which is totally fi…

I saw that yesterday and it said the data was produced by Womply. I can't find the source though.

BUMP: could this be it?

https://tracktherecovery.org/

Re: 40% of California's small businesses died in the last two years

#50

Post by grogenaut »

listenallyall wrote: post #37
wilkystyle wrote: post #35

Earlier quoted context omitted.

It's almost as if they're friends who talk about things that happen in each others' lives!

Not on this planet. This sounds like how you talk to your accountant, not your friends. You don't burden your friends with details this specific.

My friend wants to own a brewery and was an accountant, my other friends are in finance, banking, etc. Last time we hung out we had fun going over the business plan of the brewery my friend was working for in detail down to costs. It was a fun chat. My other friend wants to start a honky tonk in his hometown, he's in construction but was also quite interested.

I don't remember all the details that's what paper is for, we got down to salary and % ownership stake while at a burger joint in rural Texas on our way to a lake.

I got to Texas 2 days early to hang out with my friend who I hadn't seen in a while. We went to 5 micro breweries in 5 meals so he could scout them out and get my feedback (just general dude) on the decor, food, beer selection, location. We talked about that interlaced with talk of families and friends.

I really don't think it's uncommon.

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