From time to time at Insourced, we will forego the standard article format to bring our readers an interview of a friend, associate or acquaintance with a particularly interesting job or work experience. For this week, we’ve interviewed Beth Joy, a former Visual Merchandising Manager at the well known Macy’s department store who started her own women’s clothing store in December, 2003. We’ve spoken with Beth about the various challenges of being self-employed, the startup process and continuing to run a business as a sole proprietor.

Insourced: What made you want to start your own business, and when did you start the business?

Beth Joy: Working for a large company was very frustrating because I always felt that things were being done very inefficiently. Working at Macy’s had its bright spots, but generally I felt that my department was improperly run. I really didn’t like the red tape, the layers of management, and I really knew that I’d be able to run a business more efficiently. I started the The Fashion Attic in December, 2003, but didn’t open the doors until the following month, in January, 2004.

Financially, working with Macy’s was fine, but there was always a high level of anxiety for me because expectations were often very unreasonable. In one instance, upper management laid off a number of employees and then had me take on the roles of the other managers and supervisors who were let go. I had the job of four people, but the same pay rate. It was at that point that I seriously began considering becoming self-employed.

In: Why did you choose the particular business that you did?

Beth: I’ve been in a retail environment for roughly 20 years and have a lot of experience with merchandising in general. Though Macy’s held some poor experiences for me, I did learn quite a bit while I was there and it enabled me to start the type of business I did.

In: What, for you, are the advantages and disadvantages of working for yourself?

Beth: Autonomy! I love being able to do what I want, when I want. I have to keep certain hours, of course, but there is no one to answer to and my only concern is making enough money to support myself. The disadvantages are closely related though – at Macy’s, I had 5 weeks of paid vacation. Now, I’ve got to carefully plan even a single day off. Also, I don’t have the luxury of not worrying about the financial aspect of the job. I get paid based on what I sell, so a bad month leaves me a bit anxious.

In: What was the hardest part about starting your own business?

Beth: The fear. It was scary to leave my job - which offered steady income, sick leave, vacation time, a set paycheck - and then go into the unknown. It was a big step, but one that I’m glad I’ve taken.

In: Are there any particular sources of information that were helpful to you?

Beth: There were a number of web sites and books that I used to bring myself up to speed. I don’t remember them specifically now, but I’d recommend that any new business owner take some time to read, read, read. I also talked to a number of business owners to get their take on starting a business and to find out what to expect.

In: What would you do differently if you were starting your business today?

Beth: I’d find a location with plenty of parking. There are generally spots to parallel park near my store, but those coming from outside the city have a phobia when it comes to parking in anything other than a standard pull-in spot. And they let me know about it!

In: What type of legal entity is your business?

Beth: A sole proprietorship.

In: Why did you choose that?

Beth: It was recommended by my accountant and a business advisor, though I’m considering incorporating.

In: What type of corporation would you form?

Beth: An “S” Corp., also at the recommendation of my accountant. He generally recommends that over an LLC, though he’s also noted that they’re very similar. Since income from the business passes through to me anyway, an “S” Corp. is an appropriate way to set up the business.

In: Is there any history of self-employment or business ownership in your family that served as an inspiration?

Beth: My brother owns his own contracting business. That made me realize that it’s possible, that I could really do it. He’s been self-employed for at least 10 years and he’s generally done quite well and, most importantly, is happy doing what he does.

In: Was there anything you learned in school that has been helpful or relevant to your job? Was there anything learned in other jobs that was relevant?

Beth: As I noted, Macy’s taught me a lot about what I’d have to do from a merchandising perspective. In school, I studied art and became interested in visual merchandising. That lead me to Macy’s, which in turn taught me essentially every aspect of operations that I needed to know to do my job now. What I had to learn on my own was the accounting and IT aspects, which I didn’t study in school at all.

In: Beth, thanks for taking the time to talk with me, and I wish you luck with The Fashion Attic.

Beth: No problem, and thanks!

By taking the time to talk to Beth about starting a business, including the potential pitfalls and the most difficult aspects of doing so, we hope to bring a bit of an inside look into the process for those who may be considering self-employment. Having been through the process myself, I know that the most difficult part is typically not the hours upon hours of hard work that go into starting and running a business but the odd feeling that comes from realizing that you don’t have to answer to anyone. It’s both freeing and frightening, and can be debilitating to those who haven’t properly prepared themselves. Those unaccustomed to structuring their own time must quickly learn to do so.

Another specific area of interest to those starting a business is the type of business they will have. The sole proprietorship is quite common, but doesn’t offer the same protection as a limited liability company (LLC) or what is known as an “S” Corporation. Speaking from experience, the first thing to do when starting a business is to find a GOOD accountant. He or she will be able to help you decide which type of legal entity is appropriate for your business and will also be able to help you with the filings necessary to form a sold proprietorship, corporation or LLC.

Tags: business owner, s corp, self employment, sole proprietorship

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