Small, local businesses have a familiar cycle that gets revisited again and again and again. That's why we call it a cycle, I guess. Some cycles imply a sense of renewal and health, while others are more like a downward spiral. I suppose this particular cycle could be one or the other depending on how you view it.
Energy with the New
There is nothing quite like an individual, or a family, or small group of people who decide to put an idea into action and use it to create a new, local business. The world apparently (and happily) seems to have no shortage of individuals who have ideas, who have energy to act on them, and who are willing to work hard to try to make them fly.
Let me clear here. I am talking about those folks who are looking to serve their local or regional communities with their business. I am referring to those who will work to provide a real product or service in exchange for fair compensation. I am not focusing on those who might call themselves an entrepreneur with the sole intent of growing money and influence for themselves.
Communities frequently extend themselves to encourage these new entrants into the business world. People are excited to visit the new restaurant, stop by the new coffee shop, take a gander at the new clothing store, or drop a dollar or two with the new local food producer.
Of course, there is a subset of people who look askance at anything new and many businesses fail to get enough notice to even have a fair start - so it's not all roses. Typically expenses are much higher early in a business as it tries to build the infrastructure it needs to do work. And, there is a great deal to be said about the inevitable mistakes that are bound to happen that will help them to become far better at what they do - if they can manage to survive those blunders.
There is often more forgiveness available for a business (and the people that make up that business) as long as they are still recognized as being "new." Often, services a new business might need are extended at discounts or other courtesies are offered to the new kids on the block just to help "get them started." I recall that we had several people sign up for our first year of our CSA program in 2005 because they wanted to help us get established.
All of this happens for as long as people perceive a business as new and exciting. Once it seems like that business is here to stay - things change.
The Curse of Being "Established"
A local business typically hopes to get past the initial growing pains as quickly as possible - if only to create some sense of stability for themselves. There is only so long you can run in high gear trying to just get things in place for a business to run. I recall clearly how anxious Tammy and I were to get ourselves to a point where we were no longer just trying to figure out HOW to do things and we could just DO them.
The reality of the situation is that, at least with our type of farm, you are ALWAYS in a continuous process of trying to figure out how to do things because circumstances are always changing. But, there was also a point where we needed to present an air of competence to our client base. Remember - they're only going to accept mistakes for so long before they have decided you are no longer 'new.' And, if you are 'established,' the appearance of incompetence is a quick way to find the exit.
This is the stage where many small, local businesses fold. The initial rush of interest has vanished. In our case, we found out the hard way that many of the folks who joined us in the first year would not return for our second year of production. Why? Well, they just wanted to help us get started. They weren't really interested in our produce or service. Their mission accomplished, they left us for some other new project. Happily, we did find enough new people to replace them, but we did not meet our projections because we had false information based on the initial interest.
Looking back, I would say that a small, local business does not really become established until year four or five. If it can survive that long, it will be an exception to the rule as most small enterprises will fold in the first three years for a whole host of reasons. The disconnect here is that the community typically does not see a business as new after its first or maybe second year. In reality, a community probably should incubate a business for three to five years just to get it to the point where it will continue to be there to serve.
If a small, local business happens to make it to its fourth or fifth year, it often becomes clear that the owners/operators of that business are not only investing themselves in their business, they are investing in the communities they serve.
You may feel free to disagree with me, but my observation over the years is that there are a couple of models that people follow for new businesses. One is to create the business and intend for it to always grow and get bigger. If you've ever watched "Shark Tank" (I've seen a few short sections of it a couple of times), that would fit this model. Once again, the goal is focused around making more money, building market share and increasing influence.
The other model is to create a stable business of a size that will sustain the owners/operators and their families while treating employees well. In this model, there is certainly a desire to make enough to be comfortable and to have the ability to make investments that could make the business better. But, on top of all of that is a sense that service and connection to the community is part of the equation.
A stable, local business recognizes that some of their return they must expect comes in the form of community support and community connection. Sometimes, these businesses must accept community connection as a partial replacement for monetary income. For example, a small restaurant in a small town had been owned by one family for thirty years. If you ran the numbers, it might be hard to understand how that restaurant kept going. But, if you went there, you came to realize that the owners were receiving all sorts of intangible benefits from their community and they were willing to accept those benefits in lieu of financial rewards.
Every day, entertainment entered the door of varying types and qualities. Customers were friends - so the owners and workers combined work time with social time. No one blinked an eye when the grandkids hung out at the restaurant all day long. If one of the kids came up to your table, you just said hello and gave praise for the picture they had just created. When, the owners retired and sold the restaurant, it became apparent fairly quickly that the new owners were not ready to accept those sorts of benefits as a substitute for monetary income and the restaurant was closed eighteen months later.
If a small, local business is fortunate (and if they have some skill), they will hit a period where they are at peak performance. They are able to produce a quality product or service reliably. They have confidence in their ability to produce and have enough experience to consider and make adjustments as times and situations change. And, they have a customer base that keeps them close to their capacity for production while they are compensated fairly for their efforts.
I am sure the amount of time it takes to get to that point differs for each type of business and for all sorts of communities. In the case of the Genuine Faux Farm, I would say we hit this point at about year nine. Don't get me wrong, we produced quality food prior to that point and we had skills before then. But, we had been continuously improving in all respects up to that point and were, in my opinion, putting it all together at a high level at that point in time.
We had finally built up a solid farm infrastructure that allowed us to do our work with a more reasonable amount of effort and we didn't find ourselves needing to invest anything and everything we earned back into the farm.
Were there still mini-disasters and mistakes? Of course! But, we had the skill and experience to handle them well - or at least better than we had in the past. It was also about that time that we heard people referencing us and our farm as 'long-standing' producers of or supporters of X, Y or Z. It might have been said prior to that, but it was at this stage of our farm business that we heard those words and processed them. I guess we hadn't thought of things that way because we were just doing what we thought was right. We were a bit surprised that some people had actually noticed. But, it was a nice surprise.
Thought You'd Always Be There
I wonder if there are examples of small, local businesses that find the size they want to be and manage to stay in the "peak performance" zone for a long time? I know that in the past, when local communities had fewer options to go for service, there would be numerous examples of small, local businesses that managed to run for more than one generation in a family. But, I suspect they had periods at peak and other times where that wasn't the case.
In the present day, competition is not just with other local businesses and, frankly, the connection members of the community have with local establishments is maybe not as strong as it once was. But, the truth of the matter is this - a small, locally owned business is often an extension of a family or a couple of families. This type of business is inextricably linked to those lives and if the business is in a down-cycle, the family has to bear that along with all of the normal stresses that come with life.
And this is part of the reason why these businesses finally come to an end. Imagine that your business has shown it can reach a peak performance level. Then, for whatever reason, it appears as if demand for your product or service in your community is stagnating and you find that you are no longer being compensated reasonably for your efforts. Perhaps you try to make adjustments and changes to address the problem or maybe you decide to stay the course and hope things come back around. But, maybe you just realize you don't have it in you anymore and that maybe a different opportunity is now calling your name...
You announce your decision to move on and an outpouring of dismay comes your way from the community. People you haven't heard from for two to five years bemoan the business's absence and others say things like, "I just assumed you'd always be here. I mean, you HAVE always been here, haven't you?"
Once again, these small businesses are often an extension of the people that own/operate them. How would you feel if you were essentially told that somebody expected you to hang out and wait for that moment they decided they needed you for something. Or worse yet, they just wanted you to keep going so they could feel good that you were "still there."
I am sure it would be tempting for those who read this to conclude that we are only talking about our own farm, the Genuine Faux Farm. Of course, much of what I write comes from that experience, so that's not entirely unfair. However, our farm is not finished - it is just moving in a different direction.
What motivated me to write this blog is the closing of a couple of small businesses we have patronized and appreciate. In both cases, I whole-heartedly wish them the best in the new phases of their lives, wherever that is taking them. Of course I am sad that the products and services I very much enjoyed will no longer be available. But, darn it all, it's not just about me now, is it?
We have seen various food producers, restaurants and businesses come and go in the communities we have been a part of over the years. What strikes me the most is that, regardless of their place in these local business cycles, they could always use the support of the community.
That support is very effective when it comes in the form of consistent patronage of the services or products rendered. But, we can also support a local business by reminding ourselves that it is populated from top to bottom with real people from the surrounding area. Sometimes these people need kind words or a little bit of grace. We can honor them with honesty and appropriate feedback. We can respect them by not pretending to know their business better than they do. We can help them get to and stay in their peak performance zone by promoting what they do to those we know who could use those products or services.
And, when they decide to move on, we can wish them well and do what we can to help them to be happy and healthy as they make the transition.