From Bagel Shop Owner to Homeless

The bagel shop I owned for six years closed in 2009. The store had been in existence for more than 30 years. When the economy took a turn, I raised prices, reduced inventory, borrowed cash, and sold personal property, but people just weren't eating out as much. Now I am living on the streets, looking for work every day. My credit is terrible, but the only thing in the world I want is to reopen my shop. Is there any way I can do that?
—L.F., Rancho Cucamonga, Calif.

Yours is a very sad story: I'm sorry to hear about the loss of your business and your personal misfortune.

How do you reboot your life after this grueling experience? Having an honest discussion with yourself, some trusted advisers, and perhaps some former colleagues would be one way to start. Figure out what you did right, and where you went wrong, over the six years you owned the bagel shop.

Meet with your former accountant and your banker, if you had one. Talk to customers about what went wrong with the business from their perspective. You may gain valuable insights that did not occur to you when you were in survival mode, says Robert C. Seiwert, senior vice-president of the American Bankers' Association's Center for Commercial Lending & Business Banking in Washington, D.C.

You can get formal business counseling through the Small Business Administration's Small Business Development Centers or the SCORE organization.

Getting Some Income

Obviously, until you are back on your feet with an address and steady income, you will not be able to secure the capital to reopen your business. So finding employment is your first goal.

Emphasize your experience—not your misfortune—as you search for a job and be sure to give the impression that you are flexible and willing to learn. Be ready to start part-time behind the bagel counter and move up the ranks, says John P. Delmatoff, a small business coach with PathFinder Coaching in Murrieta, Calif. "This sounds like counsel I'd give to a young person who's out looking for their first job, but let's face it—the whole market has been turned on its collective ear. All the rules have been broken or discarded. This is a time for doing whatever it takes," he says.

If retail shops are not hiring in your area, consider contacting some franchise bagel outfits that might be looking for help with employee training or support, suggests George H. Harrop, managing director at CapitalSource (CSE), a small business lender with headquarters in Chevy Chase, Md.

"Get a job with an organization that does relief work or a nonprofit that helps homeless people find jobs," he says. "With your experience in food preparation and service, you could help train and counsel people in your same situation." Volunteer with such organizations if they can't hire you immediately: At least you'll be making contacts and participating in your community.

"Keep Hope Alive"

Once you are employed and more stable financially, there are many routes back into entrepreneurship. You might persuade your employer to open a store you could manage and eventually buy out. Perhaps the space where your business was located is still vacant and some private investors—loyal customers who miss the old shop—would help you reopen.

Buying a bagel franchise is another possibility, as is a microfinance loan, says Laura Kozien of small business microlender Accion USA. "Continue following your passion for entrepreneurship," she says, "and consider this an opportunity to learn new things that you can incorporate into your reopening."

Most of all, don't lose hope. A self-help group might lift your spirits, Delmatoff suggests: "I think there's a big and mean mental game that must be played here. If you lose hope, then it's game-over. So I'd focus on doing everything to keep hope alive."

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