Simon and Eniko Sheehan are the founders of startup business Texture Cafe in the Auckland suburb of Flatbush. The business has five full time and three part time staff.
How did you come to start your own business?
Back in December last year my wife Eniko and I were looking for a business opportunity. We jointly have 45 years of hospitality experience, and taking the leap to start a business together seemed a logical progression in both our careers.
While we were considering our options, a new complex of shops was being built just around the corner from our home. We saw the opportunity to get in and secure a location as we didn't want to take over a failed business then rebuild the trade. We felt that starting with a fresh slate was the best option for us.
How did you go about putting together a business plan for the venture?
We came up with a concept that we believed had a unique selling proposition to attract the type of people who are moving into the area. We're in a very multicultural location and we wanted to cover a range of dietary requirements; affordability was another key consideration for us. However we also planned to have room to move on this as we were still only guessing who our customers were.
We priced out what it would cost to set up the business, and then created a sales forecast, including profit and loss. A key consideration for us at this stage was not to overestimate sales, so we set realistic targets and provided an in-depth breakdown of costs to convince the bank to lend us the money.
What benefits have you gained from having a business plan?
The plan was key to setting up the business. If we had jumped in unprepared we may have run out of money before we opened.
Although we were meticulous when we created the plan and thought we'd costed out everything, there were still missed items or new council requirements that we hadn't accounted for.
But the plan did cover 95 per cent of what we needed to do to achieve a successful set up; it meant there weren't too many surprises.
Once we were open, though, our sales forecast didn't match actual sales. But we had accounted for this with our planning in that we made the decision not to place large orders from our supplier, and made sure anything we did buy was on sale or return. After a few weeks a sales pattern developed making buying easier.
Given your own experiences, what business planning advice would you have for others looking to start up their own businesses?
