Here today, closed tomorrow

Today the buildings that were once occupied by Katie's Bloomers Floral Shop and Smokehouse Pizza stand vacant — a stark reminder of survival rates for small businesses.

Kathie Swan said her husband started to experience health problems shortly after she opened her floral shop, 2630 Broadway, and she was forced to close after only a month of business.

“We invested $25,000,” said Swan, a florist of more than 20 years. “That’s a lot of money, but I just felt like it was more important to take care of him.”

According to the U.S. Small Business Administration (SBA), only half of the new businesses that open survive five years or more and only a third will celebrate a 10-year anniversary.

Swan said her husband’s health has improved and while she would love to work in a floral shop again, she is unable to invest in another business venture.

Unfortunately, Bob Anders, a volunteer at SCORE, 1106 Meridian Street, said Swan’s story is a common one for small businesses. SCORE is a nonprofit association and resource partner of the SBA providing free education and services to small business owners nationwide.

“It’s a tough business, it’s a really tough business,” he said. “Lots of people really underestimate what it costs to start up.”

Great ideas do not always result in a success, Anders said. Like the story of the hare and the tortoise, slow growth often produces the best results.

“People grossly overestimate how successful they are going to be,” Anders said. “If you underestimate the money necessary to start the business and overestimate revenue, you are out of money and out of business.”

Expenses including taxes, insurance, utilities and advertising can cripple a startup if not carefully budgeted. Anders said business plans can help new entrepreneurs understand their strengths and weaknesses.

“There are no rules to business plans, there is a format, a guideline, but there is no fixed format,” he said. “Of course you also need to have a passion for what you do. But it’s a living, breathing document. Do it in pencil.”

Anders said most successful businesses have great ideas, but they are also methodical about what they do and they have invested time researching markets, strategizing how to make the best use of social media and free or low cost resources.

Networking and facilitating an introduction to key markets can also make a difference in business survival, said Kyle Morey, president and CEO of the Madison County Chamber of Commerce.

“Since I have been here in 2010, we have had maybe two startups that didn’t finish their first year - maybe three,” he said.

Morey said the chamber helps businesses work toward their goals because often, while people have a great idea, they don’t know how to network or built a product. But failing is not always the end of an entrepreneur’s dreams.

“I have been a part of a successful startup and one that was not a success and I gained experience from both,” he said. “Both were a success in my mind. The failed attempt would not have opened up other opportunities if I had not gone through those steps of failure. In my case, my failed product was a decent product.

Morey said determination is also crucial to growth and success.

“Once you lose that passion for a service or product, there is not much drive to keep it going,” he said.