My First Business Failure, And What I Learned the Hard Way

I have a confession to make. Many years ago, I failed in my first business. That experience left a lasting mark on me, but I'm grateful to say it ultimately became a positive turning point in my life, bringing me to where I am today.

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From Dreamed Business to Business Nightmare

I'm originally from Guatemala, but throughout my childhood, I went back and forth between countries because my dad and his family live in Miami, so I was pretty used to the American lifestyle. When it came time to go to college, I decided to immigrate and come to Dallas, Texas, to attend school there.

Growing up, I have always dreamed of having my own business and thought it would be cool to own a boutique. So I chose to earn an associate's degree in Arts with a focus in Fashion Design and Merchandising to be able to pursue my dream business. 

Interestingly enough, my best friend's brother had a boutique in Dallas, and when we graduated, he asked if I was interested in buying it. I couldn’t believe I was so close to achieving my dream! I didn't have any money, but my father helped me make a down payment so I could buy the business.

I was super excited about owning my boutique! I was there day in and day out, from open to close, Monday through Saturday, every week, working hard. I had all the excitement, the will, and the spirit to make it happen. 

However, I didn’t know anything about running a business, even though I thought I did. I realized that what I had learned in college really had nothing to do with what actually happened in a day-to-day, real business. And while I was supposed to get some help from the previous owner, that never happened. Still, I was there every day, trying to figure things out on my own.

I also didn’t know that this was already a failing business. I was having trouble getting inventory from vendors, so I didn’t have enough new clothes to offer and entice people to buy from me. And what I did have for sale, which came with the business I had bought, wasn't the type of garments customers wanted to buy. So, the weekly sales weren't enough to cover the bills, and I barely had enough to pay my rent.

I had no one to turn to, no one to mentor or coach me, and nowhere to get information of any kind because back then there was no internet, no Google, and certainly no AI.

Little by little, I came to understand that the business was failing because there weren't enough sales to sustain the operations. Less than a year had passed, and after just 10 months of running my dream boutique, I decided to close it.

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Closing the Business

I remember sitting at the bottom of the stairs in my apartment complex thinking about what had happened. I was willing to do whatever, but I did not know what I needed to do or how to turn things around in my failing business. And now I had to close the business, which, again, was something I didn’t know how to do, but I had to do it before falling into serious debt.

But the most painful part was acknowledging the failure of my dream and admitting it was turning into a nightmare. Over the following 30 days, I put an end to everything. I took out the inventory I could and spoke with my landlord to let them know I didn't have any more money and couldn't continue to pay the rent.

I was done and ready to figure out what the next thing would be for me. As I was closing the doors of my cute boutique at the shopping center where the store was, a pizza delivery driver drove in front of me.

I remember thinking to myself, ‘What a great job that must be!’ I mean, you're always in your car, listening to music and delivering pizzas; people are always happy to see you when you arrive; there’s no stress and no big responsibilities; you just do the work, go home, and then you do it again the next day…

That's when I thought I could do that until I figured out what was next for me. But I don't wanna say much more about that, because that’s a story for next time!

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Lessons from My First Business Failure 

What I do want to share with you is what I learned out of that phase of my life.

1. Knowledge is power. While having an entrepreneurial dream is amazing, the only way you can truly make it happen, succeed, and thrive is by knowing and understanding how to run a business. I thought I could just figure it out, but I was wrong. If you don't have a mentor or a coach to guide and teach you, or the education to base your decisions on, it’ll be difficult for you to make it. This happens even if you are in franchising, where you have your Franchisor and Franchise Business Consultant to support you, because they're not going to be there with you on a day-to-day basis to teach you everything you need to learn.
2. Running a business is not easy. Even when you know what to do, it’s still a challenging endeavor. Fortunately, it becomes easier over time with experience, a great team, and growth and scaling. But it's really hard work, which is why I have a whole lot of respect for business owners, especially the men and women who are single-unit Franchisees, running a business by themselves or with their families, because at that stage of the franchise journey, you cannot delegate unless you truly scale. 
3. The struggle is real and deep. The most important lesson I learned is how painful it is when your business is failing, not only because of the failure itself but also because of the anguish over what to do and the uncertainty of what’s next. That level of understanding is a lot of what drives me in the academy today. People always say I’m truly passionate about what I do, but I will tell you that most of it is driven by understanding what happens when you fail and what it takes to come out of that to make it better. This experience gave me that clarity, and now I do everything I can to share it with our clients, customers, and the Franchisees we serve every day.

Those are the lessons that I learned during and after that phase of my life. It was not a fun time, but I will tell you I don't regret going through it because it really built a lot of my character and my understanding of what business owners go through, and of the impact of not knowing what you do not know.

If you are a Franchisee, or you know a Franchisee who’s going through hard times and you believe they could be doing better, please let them know about us!

Help us spread the word and tell them about the American Franchise Academy and how we can provide the help and support they need to make their dreams not only continue, but also thrive in the long term, based on 35-plus years of my personal industry experience as well as from the experiences of all the customers and franchises we have served.

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