Sunday, March 30, 2014

Get By With A Little Help From My Friends

Glazed Doughnut Shop in a Dead Man Walking building

One of the really hard things about renting commercial space for your mom and pop business -- which includes the vast majority of Amherst small business owners -- is you have no incentive to put tons of money into the physical structure, since you will only be enhancing the value for your landlord.

Which is why you sign a somewhat long lease at start up, because there are of course finishing costs particular to your business that you can't expect the landlord to cover, but consist of items you can't very well take with you when you leave somewhere down the distant road.   Hopefully, for a building you can call your own.

Like hot water heaters for instance.  When the Glazed Doughnut Shop first moved into the space formerly occupied by Family Wireless, the hot water heater was the size of a breadbox; and being a bakery you need a fair amount of hot water.  So out went $3,000 for a new larger unit with all the copper piping now required to meet commercial building codes.

In all owners Keren and Nick Rhodes, high school sweethearts who now probably see more of their business than they do of each other, estimate they spent $15,000 two years ago on finishing costs that they can't take with them.

Why leave a lovely location with three years left on a lease (and an option to renew for five more years)?

Well, town insiders pretty much now agree that the entire Carriage Shops complex is toast -- actively sought for a classy mixed use commercial/residential complex that will act as a major anchor for that side of the downtown.

And will be great for business in Amherst.  But not so great if you are a current tenant of the Carriage Shops.  Hence the problem.  On the one hand the Rhodes support the revitalization of the commercial complex but can't take the risk of losing the roof over their heads without another place to go.

Meanwhile, a doughnut throw away, a commercial spot opened up, larger and in an even better a location (although slightly haunted by frequent turnover).  A perfect port in a gathering storm.

Problem now is they need $15,000 to prepare the new space.  A big hit for a small business barely out of their rookie year. 

So they are turning to you.  "Mm going to try with a little help from my friends."  Which of course means a crowd funding website like Indiegogo.

Come on Amherst, we talk the talk about supporting local business.  Well, here's your poster family.





28 comments:

Anonymous said...

I have to express my concern on this move. This totally cool donuts shop is moving into the most expressive leases in town, in fact at over $50 sq ft it’s one of the most expensive leases in the whole valley. There is a reason that that bank of store fronts turn over regularly.

My other concern is that if the owners don’t have the $15,000 to move, then they are severely underfunded and might have trouble covering the overhead during the slow times like May to Sept.

I wish them luck but would highly recommend looking for another space with less overhead and a better chance of successes.

Anonymous said...

If I sell a multi family home in which I have tenants under lease, I must either sell it contingent upon the new owner honoring the lease, or give the tenants incentive to break the lease, (buy them out). Is it not so with a commercial property? Richard Marsh

Larry Kelley said...

Yes, the landlord would have to buy them out of the remaining three years but the process would start a day or two before the wrecking ball.

And by then there may not be any decent commercial spaces left in and around the downtown.

Plus, when you have only been in business 18 months, it's hard to prove how much profit you would have made in those remaining three years of the buyout.

Larry Kelley said...

Anon 7:02 PM

Yes I shared that concern as well, but they have negotiated a better than usual lease (partially because the Lincoln Real Estate wishes to put that haunted designation to rest and, maybe, because they like doughnuts).

Anonymous said...

Need a location with parking

Larry Kelley said...

Parking Garage directly behind.

And maybe the town will get around to adding a new deck soon.

Anonymous said...

NO. This is a bad location for them. They need to have better parking, I agree with the previous post. And the "parking garage" does NOT cut it as an answer for a quick stop at this location. I urge them to reconsider, this will be the death...

Larry Kelley said...

Not much parking where they are now.

Anonymous said...

The parking turnover in the carriage shops is pretty good, I always find a spot when I want to stop in, ...and for frees, btw...

Larry Kelley said...

Well, their new location is not very far up the street. Park in the Carriage Shops and walk. Except that parking lot will be gone soon enough.

Anonymous said...

Donut eaters do not walk- Any chance for a drive thru?

Larry Kelley said...

That would probably require Zoning Board approval.

Walter Graff said...

This is a very bad business decision by these folks and a death knell to their business. Sure it sucks losing your place but the type of business they have requires easy parking and easy access. The fact that this new place is known as a hunted designation itself is reason not to make the mover there. I understand their desperateness to continue business but it's that desperateness that is forcing them to make very bad decisions. I do wish them luck but wish they'd step back and look at a few realities.

Larry Kelley said...

If negativity were negotiable currency they would have hit their target goal by now.

Anonymous said...

Why not next to Mission Cantina? They could deliver to Black Sheep or the new locally grown place and have the storefront right on Rte. 116 with free parking.

Crowd funding for a retail business is not a wise idea. Customers fund a business by buying the product, not giving charity.

SJA said...

There more than welcome to move their donut shop to Holyoke

Anonymous said...

Unfortunatly I agree with anon 10:37. I think this move will be the kiss of death for them. Parking will be the major issue. I think what they will experience is many of the people that used to frequent their business will find it inconvenient to do so now and will not continue their patronage. A possible solution could be make several of the parking spaces 10 minute parking for morning commuters. this would only be implemented for the morning thus the town would not miss out on the valuable metered parking they prize so much. I hope they can hang in there as they have a great product and are good people, but the reality is the cards are against them as mentioned earlier many businesses have come and many have gone from that very expensive real estate.

Keren Rhodes said...

I find all your comments really interesting. We had many of the same concerns when we were weighing our options.

The most important thing for everybody to understand is a very significant percentage of our business is foot traffic, followed by catering that we deliver. Of course we have people who park and run in, but it is not the majority of our business.

So anywhere we move must have the high foot traffic. Therefore we must stay within the immediate downtown area.

Parking. Yes there is a lack of parking downtown. Especially at busy times like Friday/Saturday nights. But the rest of the time you can almost always find a spot. On the street, in front of town hall, or behind Boltwood walk. We spent a lot of time walking around town all different times of day and days of the week to assess how big a problem parking was going to be. We think that the "dire lack of parking in Amherst" is more a perception than a reality. We would note that during the most busy times when downtown parking is full, the carriage shops parking is full too. So we deal with this problem now as well.

If anybody has a suggestion of a location that is actually currently open , has foot traffic, has lower rent then what we will pay uptown, and is set up to be a commercial kitchen with a ventilation hood, then we are more than happy to entertain alternate ideas.

Anonymous said...

I think the new location will be great, mainly because you will have that foot traffic. Good luck!

Keren Rhodes said...

Anon 8:59
Short term 10 minute parking is a great idea. We will look into it.

Anonymous said...

You will have even better foot traffic than your current location.

Anonymous said...

Keren: Have you ever considered whether it's possible/feasible to maintain/staff a cart out in front of that space, maybe with just donuts? I think you could get a common victualer license for about $100/year? I wonder if you'd get a lot of people grabbing one on the go that wouldn't have stopped inside, or if it would get people to pause and then consider going inside for something more like a drink, etc. Maybe during peak times during good weather and when there are events going on in town like farmer's market, book sale, craft fairs, of course the ganga fest! It could be a simple but functional cart with glass or plexi display case, wouldn't require energy, part-time minimum wage staffer. a small extension of the space into the pedestrian way that would make it more approachable...you'd get people stopping to consider without the pressure of feeling obligated or committed like you do when you go into a place. I walk downtown all the time and I haven't happened to stop in your shop, if there was a cart I would have definitely stopped to see what was available.

Anonymous said...

They are not begging for charity. Each dollar level gives something of value. Yum!

Anonymous said...

Lincoln is the kiss of death for any business. Try asking Rich Slobody about space on University Drive.

Anonymous said...

I think all of these comments show the biggest problem small business owners face. Negativity! Is it too hard for anyone to just be positive for the donut shop owners and give them a sense of encouragement? With the lemons that they've been giving, can't we all just support their decision and hope they make awesome lemon glazed donuts?
If we love their product, we will all continue to patronize their shop . . where ever they end up.

Best of luck!

Anonymous said...

If they tear that whole building down what will become of that mural in the back? Are they going to try to preserve it?

Anonymous said...

I hope they make delicious, lemony donuts, for sure, but some landlords make it nearly impossible for any business to survive. There is a reason that certain locations are constantly churning; learn from history or repeat it.

Anonymous said...

I think some community constructive criticism is a great gift to these folks. I don't want to see them fail, but sometimes from the outside it's easier to see why they might.