Economy may stink but not her business

While the U.S. Small Business Administration estimates that more than half of all new small businesses don’t survive the first five years, the recent recession and its lingering unemployment have brought out the entrepreneur in many people.

Gelin is among those who are forging ahead, despite the country’s slow recovery from what economists call the worst recession in decades.

Chris Tavel and his partner Kareem Shehab opened Loose Nuts Cycles in Grant Park about six months ago.

This is their first venture into the business world, but they believe that their bicycle sales and repair shop will thrive despite the economy.

“We looked at this for two years before we opened,” Tavel said. “We honed in on our market and location.”

Tavel said that they cater to both hard-core bicycle enthusiasts and casual riders.

“One of the reasons we opened was that, with the price of gas, people seem to be using more bikes for transportation,” he said.

Professor Greg Henley, director of the Herman J. Russell, Sr. International Center for Entrepreneurship at Georgia State University, said that the problem for many startup businesses isn’t a lack of good ideas.

“It’s that most entrepreneurs aren’t prepared to run a business,” he said.

“People need a business plan, with solid research, Henley said. “The biggest question is always, who is going to buy this product? And what will they pay for it?”

Gelin said that she’s spent several years doing market research on her idea for the soap company.

But she began in earnest in 2009 when she found herself without a job. Her career as a mortgage banker ended with the housing bubble. Instead of sticking with banking, she decided to go out on her own.

“I have two boys of my own, and my sister has four boys,” she said. “Every time they come in from playing ball, it’s a chore to get them to drop the ball and get in the shower. With this, they can take the ball in there with them.”

Many of Gelin’s friends have praised her initiative. But to make her new business successful, Gelin, like others opening small businesses, will have her work cut out for her, said Bernie Meineke, the director of the Small Business Development Center at Georgia State University.

“A good idea is always a good idea,” he said. “Financial backing might be a little tougher to come by, but success in business in good times or bad boils down to just a few concepts.

“Will the company bring in more money than it costs to produce and sell the product? Are you being ruthlessly honest with yourself? Are you willing to accept the idea that you might be wrong, and change your plan? And, most importantly, do you know who your customer is?”

Henley said that success or failure can depend on whether your company can distinguish itself from the competition.

Rahel Belfield, owner of the Grant Park Coffee House, opened her shop on Cherokee Avenue last February, with an eye toward filling a neighborhood need.

“There are a lot of people living in this neighborhood, but there wasn’t a place where people could just sit and drink coffee and surf on the Internet,” she said. “I have a restaurant background, so I thought we could fill that need here.”

Gelin also thinks she’s found a niche market — boys between ages 6 and 18 and parents who have had the same hassle she had with her sons.

She used her banking connections to raise startup money and has a silent partner who helped pay for about two years’ worth of research and development.

She’s visited soap manufacturing plants in California, but no one she found could meet her cost plan for making the soap. She wanted to keep the price of the soap under $10.

So she went to China.

“I went to a tourist bureau and hired a translator and a driver, and I’ve been back four more times.”

She has a contract with a Chinese manufacturing company. Her 8-year-old son is featured on her website as the classic stinky kid.

Her products aren’t in stores yet, but her website, www.stinky-boyz.com, is up and running and accepting orders.

Gelin has approached some nationwide store chains and says she’s in talks with them.

“We have to make sure we can get enough of the product made, because some of these chains have thousands of stores,” she said.

Henley said that it sounds like Gelin has her act together.

“Luck is part of the formula for any successful venture,” he said, “but the more prepared you are, the luckier you get.”