With lifestyles that usually incorporate healthy choices, it’s no surprise Los Angeles has made the juicing trend a way of life. I had the privilege of interviewing Lucy Wagner, one of the original employees of The Juice, a cold pressed organic juice bar in Atwater, Los Angeles.

Lucy Wagner has been working at The Juice since day one and she has been through the business changes and expansion of the company for over 2 years. She shared with me her understanding on the day to day challenges the founders of The Juice has faced and her first hand perspective on business development.

What makes The Juice different from other stores is that they cold press all their juices. Cold pressing it’s a newer process in which the fruits vegetables are first crushed and then pressed in a huge hydraulic press (with a pressure equal to 5 times the pressure found in the deepest part of the ocean). Because cold pressing don’t produce much heat, it keeps more of the fresh ingredients’ nutrients intact. Traditional centrifugal juicers uses a fast spinning metal blade that generates heat which destroys some of the enzymes in the fruits and vegetables rendering less nutritious juice.

The founders of The Juice, Elizabeth and Melissa both believed in high quality juices and splashed out on the cold presser despite it’s $50,000 price tag. This was a huge cost to them but ensured the quality and nutritional value of their products.

The process of cold pressing is very labour intensive and each batch can take up to an hour. Since all juices are pre-made and bottled up, customers have complained about the lack of customization and not having juices made to order.

Even though The Juice now has 3 locations throughout LA (two in Atwater and one in the Arts District) they only have 1 juicer. Juices are usually transported to the two newer locations because it’s more cost efficient this way.

One of the biggest challenge that all juice bars face is the season’s effect on business. No only are these juice bars impacted by seasonal produce but they also have to deal with lower demand in the colder months. People often assume that with biotechnology we are able to get fruits in season all year round, this is not true. When fruits are off season, it’s harder to maintain the quality and a consistent menu. Organic Juiceries such as The Juice are particularly affected by this as they only serve organic produce which is more natural and harder to control.

And just as juices are hard to maintain in the colder months, business is too. In order to keep business during the winter Elizabeth and Melissa position the juices as post holiday cleanses and defence against the flu season. At $9 a bottle, The Juice is considered a luxury in the eyes of many people. Even though the US economy is no longer in a financial crisis, when people are not doing so well juices are the first things cut out. Restaurants experience a similar decline too especially when people try to eat in more and reduce unnecessary spending.

In the beginning, the Juice served customers ranging from regulars to locals and people visiting the area. It was very much dependent on the customers within the vicinity. However to expand their customer base, the Juice has done promotions in local farmers markets and also partnered with other local stores and cafes around the area.

Currently they collaborate with Undefeated, a hip sneaker store in the Silver Lake area. Undefeated carries The Juice products in a small in-store fridge. For this partnership The Juice created a special “undefeated” flavour only available in that store. They’ve also worked with small cafes and coffee shops around the area to expand their local customer base and increase brand recognition. These small businesses are usually close enough that the customers can return back to the original The Juice store however not so close for cannibalization. The Juice has also partnered with Pop Physique and Soul Cycle in order to reach potential health conscious customers.

Apart from expanding to other local businesses, The Juice is now available on Amazon Fresh. The Juice used to deliver their juices and cleanses to their customers for a small fee, however with the emergence of more online delivery services, it has allowed them to focus on creating a high quality product. This development has enabled a larger reach, as customers who were too busy to go in-store can now reach the product online. Association with a corporation like Amazon has also boosted it’s brand image.

Since starting the business in 2013, one of their greatest reasons for success is the location and the support from the surrounding community. In 2013, Atwater was a hip up and coming place in LA and there were cool new businesses in the area. Melissa and Elizabeth were very much a part of that community so they knew the trends of their potential customers very well. The seized the opportunity to set up in Atwater before the market was saturated with other stores. The neighbourhood has changed a lot since then, with more artisan coffee shops and boutique restaurants.

To the Melissa and Elizabeth expansion is all about timing and knowing the your customers. The neighbourhood needs to be new enough that rent prices are still low and other businesses are beginning to set up. Another great indicator is when there are a few health conscious restaurants who are beginning to be successful. Highland park is the current location The Juice is looking to expand into, it is a location that is starting to experience gentrification and already has a successful vegan donut place and vegan taco place in the area.

Visit the Juice at 3145 Glendale Blvd, Los Angeles, CA 90039

It’s been seven years since the burst of housing bubble in 2008, and the market started showing signs of recovery after 2012. It seems to be a good time to consider buying a house now, with the still-going-down 15-year fixed-rate mortgage fell to 3.08 per cent, slightly above the record low 3 per cent in May 2015, according to a Freddie Mac report.

As the mortgage rate now running below 4 per cent for nine straight weeks, the cost of getting a loan to purchase a new home has become a lot lower when compared to the data earlier this year. However, many potential first-time home buyers in low-income community, such as East Los Angeles and Boyle Heights, took a wait-and-see stance instead. More people in low-income areas have chosen to rent instead of buying houses.

“I’ve seen people renting for over 15 to 20 years,” said Alicia Bonilla, a mail carrier who moved to East L.A. in late 1990s.

Slow wage growth is not the only reason deterring potential homebuyers from owning houses in East L.A. In fact, the median home price has been hovering around $350,000 in the last quarter, which is still affordable comparing to surrounding areas of East L.A. and Boyle Heights. The median home value in Los Angeles County is much higher, at the price of $503,700.

(A house was put for sale in East Los Angeles. Photo: Zihao Yang)

The booming for-sale housing market is on its way to reach record high since the housing market collapse in 2008. The median price for a 3-bedroom house in East L.A. and Boyle Heights was around $200,000 in 2012 and $310,000 last year, according to data released by Zillow.com.

For a neighborhood highly populated with working-class families and new immigrants, living in their own houses has always been a dream for many young residents. However, many potential homebuyers see this area merely as a springboard in their life to a better community.

“The accessibility to a lot of utilities such as transportation, Metro, freeways, airport – that’s why [people are renting in this area],” said Luis Negrete, a real estate broker who started his business in 1983 on the E. Third St., “other than that, I don’t see that much incentive to own.”

A housing market with ever-rising prices but sluggish real demand has seen an increasing number of houses for sale, but the number of potential buyers didn’t go up. Investors are less interested in investing in the area because of historical reasons, so most of the buyers are immigrants or families that have been living there for a long time, said Negrete.

(Real estate agent Luis Negrete stands in front of his agency in Boyle Heights. Photo: Zihao Yang)

Due to its vicinity to downtown Los Angeles, Boyle Heights enticed many blue collar workers who want houses near their work locations but have no desire to own properties in the neighborhood.

“One thing that’s undeniable is the location. This is a prime location [for commute],” said Sergio Ramos, a realtor whose major business area includes Boyle Heights and East Los Angeles.

According to Negrete, the ideal final home destinations for the younger generation no longer include East L.A. and Boyle Heights, and the cultural root is not a factor as important as people thought to be. Instead, neighborhoods such as Pasadena and Hacienda Heights are becoming more attractive as places to own a property.

Take a walk on the streets in East L.A. and Boyle Heights, and you will be surprised to find how many houses were put for sale in the neighborhood recently. “They were not even for sale last month,” said Art Kawaguchi, an auto repair shop manager on the E. Third St.

But the number of home sales transaction remained flat and sluggish. Since 2012, not including investors, East L.A.’ housing market shifted further toward renting, said Ramos.

According to East Los Angeles Community Corporation (ELACC), the homeownership rate was only about 11 per cent in Boyle Heights, far lower than the average 46.9 per cent of Los Angeles County. On the national level, the homeownership rate is about 64 per cent, reported the U.S. Census Bureau.

“In this building, a lot of young families did move in. They are just trying to find a place to live on their own. But for them to buy a house, I believe they are not ready yet. They haven’t really mentioned it or talked about it,” said Jeremias Tomas, a property manager of Sol Y Luna Apartments on the E. First St.

It is projected that the mortgage rate will stay low after the Federal Open Market Committee decided to keep interest rates at record lows. But according to Fed Chair Janet Yellen, a Fed rate hike, which could affect domestic housing market, is still likely in 2015. The FOMC will host two more meetings this year, in October and December respectively. A Fed rate increase could make home loans costlier and discourage people from buying houses.

Economists predicted that in 2016, more first-time and younger buyers will “take the plunge on homeownership because the cost of renting will keep going up”, and that will “make the security of a fixed mortgage payment more attractive to more otherwise content renters,” according to a Los Angeles Times article.

Even if predictions suggest that the decreasing cost of buying a house will incentivize more young homebuyers to consider owning properties, in many low-income communities in Los Angeles, it seems that the younger generation are thinking of somewhere else to settle down in the long run.

 

 

Sources:

http://www.freddiemac.com/pmms/index.html

http://freddiemac.mwnewsroom.com/press-releases/mortgage-rates-calm-ahead-of-federal-reserve-decis-otcqb-fmcc-1217973

http://la.curbed.com/archives/2015/07/los_angeles_housing_market_bubble.php

http://www.chicagotribune.com/business/ct-mortgage-rates-slip-20150924-story.html

http://www.federalreserve.gov/monetarypolicy/fomccalendars.htm

http://files.zillowstatic.com/research/public/Neighborhood/Neighborhood_Zhvi_AllHomes.csv

Entrepreneurship is such a trending word it seems anyone can start his own business. But not everyone is lucky enough to obtain an entrepreneurial opportunity. The owner of Home Brite Cleaning Services, Siraj Mirza, is part of an alternate trend which people buys an existing business and makes smart modifications to help the business prosper.

Home Brite Cleaning Services is a professional cleaning services company started in 2009 that provides private home cleaning, pre move-in and pro move-out cleaning, office cleaning and post construction cleanup services. The owner of Home Brite, Siraj Mirza, currently in his mid-40s, used to be a banker working with foreign banks; he was laid off during the recession in 2008, leaving his wife, Tess Zaidi, under heavy financial pressure. After changing jobs for a few times, Mirza decided that he didn’t want the stress of managing credit portfolios anymore, so he purchased the national franchise and canceled original contract deals restricted to cleaning services in Beverly Hills and Studio City areas. Instead, Mirza and his wife created their own brand, Home Brite, and started serving personalized home cleaning services to multiple areas within LA County.

Mirza recalled that when the business first started out in 2009, sales kept going down for a year because of the downturn that entire U.S. economy was undergoing back then. “Life was very stressful in 2009, we had lost one of the properties we owned to foreclosure”, said Tess. Thanks to the recovery of overall U.S. economic conditions and Mirza’s hard work, Home Brite has been able to double its business sales every year since 2011. In addition, Home Brite improved its service quality, and it started its marketing campaign, as well. As a result, Home Brite is able to reach steadily growing annual sales of 200,000 dollars in 2014.

The most dominant change that Home Brite made to its business is personalizing its services. Mirza knows his customers very well in person and remains accessible to his customers through text messages and phone calls daily. For private home cleaning service requests, Home Brite is able to respond very quickly and arrange timely services for its customers. By maintaining its high quality of service, Home Brite is able to maintain its loyal customers while increasing the number of new customers. Another factor that helps Mirza with increasing sales is diversifying the projects his team works on. For example, he himself would work on smaller apartment cleaning, and his other team of 6 people would work on larger projects such as post construction cleaning for an entire house.

According to Home Brite owner Mirza, he refers the housing market and national unemployment rate as two broader economic data that impact his business. Since the service Home Brite provides is essentially a discretionary service, the demand for home cleaning services depend largely on people’s economic conditions. When unemployment rate is low, people can afford discretionary services; however, when unemployment rate rises, people are losing jobs and thus are less likely to afford discretionary expenses. Another factor Mirza concludes that affects his business is the housing market. A robust housing market creates more demand for house cleaning services, yet a weak economy reflects a low level of investment that results in less demand for services.

The biggest challenge Home Brite faces with currently is to find reliable employees due to the nature of service it provides. “It makes me nervous”, said Tess, “we have not experienced anything bad, but I always want them [the cleaning team] to be extremely careful with expensive items”. Indeed, many people who use cleaning services worry about the same trust issue. In order to maintain the loyalty of both its employees and customers, Home Brite owner Mirza says he would choose to grow the business at a controlled manner. He notes that he does not want employees who are “constantly not available or constantly changing jobs”; it is not the size of a cleaning team that matters but really the quality of its service that matters.

In general, the lowering of interest rates has allowed investments pour into construction, which creates more jobs in post construction cleaning for cleaning services such as Home Brite. “When more buildings are being built, it increases our sales”, said Mirza. One may think that access to capital is a requirement for starting a business, but for a smaller business like Home Brite, Mirza used his savings to finance the initial stages of the business. Once the business is up and running, there is little capital they had to acquire from banks.

The major competition for Home Brite comes from independent workers who are not registered with residential apartment buildings. Another competition comes from national cleaning franchises such as Merry Maids and Molly Maids, because these companies are capable of much stronger marketing campaigns, especially their powerful online presence. On the other hand, Home Brite holds its own advantages. Mirza and his team are flexible in time scheduling and they always respond quickly to customers. Besides, their services have no territory restrictions. “When I talk to people who used to use other larger maid service companies, customers have complained that they never answer the phone or response to text messages, and they keep changing the times”, says Tess. Although Home Brite has not been able to raise prices for the past 5 years, it has not yet had to offer discounts to attract customers either.

“We are currently bidding for a few larger projects over 100,000 dollars per job”, Mirza says. “We now show up as the No. 1 post construction cleaning team in LA County.”

Diversification of jobs has increased Home Brite’s competitiveness in the market. In the mean time, by maintaining good relationships with its current customers, Home Brite is taking the purchased franchise onto a fruitful path.

In the mid-to-late 2000’s, a number of college students might have lamented graduating into the worst economy since the Great Depression.

Not Brenton Sullivan and Kai Sato—they launched a business in the face of a crashing financial market in 2008.

The 2007 USC graduates’ concept for what would become FieldLevel had been named “Best Business Plan” by the Marshall School of Business’s Lloyd Greif Center for Entrepreneurial Studies, and the pair had even received an offer of $1 million for an 80 percent stake in the company but we unmoved. Instead, they took the more difficult path, opting to bootstrap through the early part of their existence.

Numerous sleepless nights and pivots later, FieldLevel was accepted into the Los Angeles Dodgers’ Sports and Entertainment Accelerator—a distinction that came with $20,000 in funding—last month.

Sullivan and Sato maintained a cash flow positive business well ahead of being accepted into the accelerator. While cash flow positive and profitable are two very different distinctions, and the company still has a ton of work to do, the fact that FieldLevel has taken off in the face of a horrific economy is impressive.

Both entrepreneurs attribute their success against the adverse economy not only to their passion and flexible business model, but also to the generosity of friends and family, who provided them the initial funding that enabled them to avoid the typical path of venture capital (and reject the early offer to cede 80 percent of the control in their business).

Sullivan and Sato have always been leery of traveling down the VC path and seemed almost thankful that it’s nowhere near as established in this half of the state as it is up north in Silicon Valley. The tech industry, as a whole, has numerous stories of VC’s either making small investments as a means of basically stealing entrepreneurs’ ideas and putting them out as their own or as a takeover (the initial overture FieldLevel received).

Perhaps what makes this story most interesting, though, is the fact that at no point were economics a driver for this business. Ultimately, the business needs to transition from cash flow positive to profitable, but the duo is in no real hurry to make that happen.

To these two former high school athletes who were largely invisible to recruiters, it’s more important to get it right.

“Finding the right fit is the key,” Sullivan said. “I was probably a guy who should have been at a DIII school somewhere, but they had no way to find me. I would have had to go to them.”

FieldLevel is a free service that aims to bridge this disconnect, enabling coaches at all levels to have the same access to prospective players.

One major differentiator, though, is that college coaches would be connected to high school and travel team coaches—not to the players themselves. This (theoretically) shields college coaches from being spammed.

The other? It’s free.

“This is where the economy, I believe, worked in our favor,” Sullivan said. “Recruiting services are outrageously expensive and, generally, get minimal returns. College coaches we talked to hated them.”

The combination of frugality, recruiting service fatigue and use of prep coaches as a buffer enabled FieldLevel to amass the largest network of coaches in the industry quickly. But instead of rushing to “monetize” or “maximize valuation” like venture-backed Silicon Valley companies, Sullivan and Sato are looking to continue refining their business—a process aided by the Dodgers Accelerator.

“Developing this business has been an evolutionary process, and we’ve had a number of pivots along the way,” Sato said. “We needed a partner that understood that, which is why we chose to do the Dodgers Accelerator. We didn’t need the funding, but the collocation space with other entrepreneurs and the corresponding added brainpower are invaluable.”

The heavy focus on product and willingness to proceed in the face of a negative economy have been key to FieldLevel’s growth, but that doesn’t mean the entrepreneurial team behind the company hasn’t paid any attention.

“We grew our business in the face of an economic downturn, and sure our [friends, family and business model] made it possible, but there was also a lot of chatter on Capitol Hill about helping small business as the economy was at its worst point,” Sato said. “But even as we hired, we never saw any of it.”

True to startup culture, though, they refuse to spend any brainpower on it.

“It sucks, but we’re too busy building our business to worry about it,” Sato said. “We’re not taking the company public or anything like that, but we firmly believe that the best is yet to come for us.”

The economy and a couple high-profile flops have made the IPO market essentially stagnant over the last few years, but hopefully his optimism is not in vain. While he company will still face the dilemma of how to monetize a network of users, it can look to the successes (and failures) of predecessors like Facebook and Twitter (albeit on a much smaller and more targeted scale).

The economy might not have factored heavily into its growth to this point, but now that FieldLevel has taken on capital and is looking at adjacent business opportunities, it is unlikely that the company can continue to ignore it.

“September and October of 2008 was the worst financial crisis in global history, including the Great Depression.”, the former head of federal reserve, Ben Bernanke, said. Although seven years have passed since the country has broken out of the crisis, many companies are constantly affected by the fickle health of the economy.

Richard Martin, who is a publicly certified accountant, founded Martin & Associates in 2003. The company provides accounting and financial accounting services such as business consulting, investment review, and tax planning to individual and business clients. For example, it calculates the gross profit percentage for its customer and gives advices on whether its customer needs to adjust production quantity or the pricing. Moreover, Martin & Associates analyzes businesses from a financial perspective, often resulting in financial advisements. When their customers are in debt, Martin & Associates evaluate the financial health of the company and make adjustments necessary to return to a healthy cash flow. What differentiates Martin & Associates from other accounting firms is its commitment to establish valuable relationships with its client base customers. The company truly believes that the success of their clients impacts the success of Martin & Associates significantly.

Further, Martin correlated the state of the economy to his firm by insisting it is all a “chain effect.” The prosperity of Martin & Associates depends on the financial health of its clients. When its clients are financially healthy, there is a more rapid rate of payment and a steadier flow of consulting appointments as they seek advice with investing their surplus cash; however, during times of economic hardship, more effort is required on part of Martin & Associates to ensure that payments are made within a feasible period. If one of its customers is not performing well, it affects Martin & Associates directly because the customers do not have the means to pay the company for its financial services. When their clients file for bankruptcy and go out of business, Martin & Associates feel immense pressure d to actively seek out more clients by going through additional service providers and networking. Interestingly, a large amount of their new client base comes as a result of referrals.

Besides the broad economic environment, the movement of the federal interest rate impacts the client of Martin & Associate the most, inversely impacting them. “The lower the interest rate, the less interest expenses for my clients, resulting in more liquidity. In times of notably high liquidity, my clients seek additional financial consulting”, stated Mr. Martin. When Martin & Associate’s client owns greater amount of capital, they tend to invest in capital goods therefore demand more financial advices. For example, a client with additional cash flow for any given time period, may want to invest in additional land or equipment, and seeks advice from Martin & Associates as to what the financial return of those investments may be.

Additionally, government regulations are one of biggest challenges Martin & Associates is currently facing. Every time a new law or act is put in place, its clients must reallocate their budget breakdown to meet the needs of the change. An example of this may be additional health insurance costs as a result of the Affordable Care Act, or a change in minimum wage. In addition to these widespread regulations, there are also additional changes that vary from industry to industry (being that their client base varies from insurance brokers, to tech companies to restaurant chains). For this reason, it is important that all the employees at Martin & Associates stay up-to-date on changes within various industries and have the knowledge to respond to those changes.

Furthermore, Martin & Associates is an outstanding company because of their personal ethical decisions within their own firm. Since the 2008 global financial crisis, many businesses have made changes within the company in order to survive and remain its status within the market. Some companies offer discounts to its customer in order to maintain its competitiveness. However, instead of lowering the price, Martin & Associates decided to maintain its original price but provide added service. “Once you lower your price, you are competing with other companies on the price level instead of competing on service. Lower price may imply lower quality, and competing on price alone does not build loyalty with customers”, Martin said.

Another significant obstacle that Martin & Associates have strategically conquered is the growing popularity of the Internet. The Internet era not only affects the way people communicate with each other, but also affects the competitive landscape in the accounting field. With the convenience Internet provides, instead of seeking financial advices and services from traditional accounting firm, people turn to online software. In order to raise its company’s competitiveness, Martin suggested that his company understand the trend and further provide extra services to its clients. He mentioned, “Online software servers are able to reach a huge amount of audiences. Technology brings competition, therefore companies have to keep up with the technological innovation to provide added value services.”

Starting a business of your own might not be easy task but keeping the company running through economic hardship is certainly harder. By maintaining relationship close relationship with its clients, creating added value services, and constantly monitoring the economical trend of the market, Martin & Associates is able to withstand through the ups and downs of the economy.

The Medical Marijuana industry has been a controversy in the United States for years.  It is a touchy subject that maybe an old man and his son would get in an argument about because of the interesting changes that have taken place through the generations. However, many are making an entrepreneurial leap of faith and creating Medical Marijuana as a business that thrives. This is the case for Nate Taylor who is a Seattle native and has spent the last five years in the industry with his Medical Marijuana Company called Fweedom Collective. Nate has done more than create Fweedom Collective as a well-known million dollar business in Seattle. Fweedom Collective has benefited consumers, the city of Seattle, and influenced the legal changes that are being processed today.

Three years ago recreational Marihuana was legalized in Washington State. Since then, the government has started to regulate the Medical Marijuana by joining it with Recreational Marijuana and push it all into one system. Before the law was passed, Medical Marihuana was only loosely regulated. Though this may seem beneficial for Nate’s business, it has definitely takin a toll on the company.

On Sunday, September 13^th, I gave Nate a call. It was 12 P.M. and Nate answered to the sound of a football game, Seattle Seahawks vs. St. Lewis Rams, which was playing in the background. Nate is an avid Seahawk fan who attends the games frequently.  The Seahawks were down by nine points, It was the third quarter, and when asked if the Seahawks would come back he said, “Oh, for sure!” While the game was still playing he was more than willing to answer the questions I had for him, with an occasional burst of excitement or dismay from the game.

Many economists are probably wondering: has the Medical Marihuana industry been impacted by cyclical or secular shifts? When Nate was asked this question he said that the answer was most likely secular. If the economy goes down, people don’t stop spending money on the product, it is a necessity to them. However, they may buy less of it at a time.

With the economy changing and new technology constantly being developed, businesses have to adapt. Nate said that over the last few years Fweedom Collective has had to make some beneficial changes. It increased its Search Engine Optimization, worked on improving and creating more online orders, and developed different apps that profit the company. The business also increased its hours of operation due to demand. Nate noticed early on that people get off work later and by creating longer hours improved sales. These changes helped Fweedom Collective stay on track with today’s basic needs for consumers.

Seattle is a booming city, and many businesses have either expanded or moved there for better opportunities. Some of these big local businesses are Amazon, Expedia, T-Mobile, and Microsoft. Nate mentioned as long as these companies are prosperous, steadily growing and no economic down turn, the city benefits, including his company. “As crazy as it sounds”, Nate said. “When professional teams in Seattle perform well, spending has increased at Fweedom Collective.” After the Seahawks won the Super bowl in 2014, sales dramatically went up at Fweedom Collective.

Of course being in the Medical Marihuana business is not easy, especially since it is loosely regulated. Mentioned earlier, Recreational Marihuana was legalized in 2012, though this might seem like it would benefit Fweedom Collective right away, it actually has presented many challenges. “My industry is at the end of an area, the probation of Marihuana, therefore making it a grey area,” Nate continued, “a lot of changes are being made.” Even though the law was passed over three years ago, the government is still in the process of making regulations for recreational Marihuana and should be resolved by 2016. With no heavy guidelines, many smaller recreational businesses have entered the market and have changed the prices of products. He elaborated on how he has seen products that were priced at $13 drop to $10. “We constantly have to change prices and adapt to the environment around as more businesses are evolved,” Nate said. He also believes many of these stores are in it for the money and only want to be open for a short period of time. In July of 2016 Recreational Marihuana should be fully regulated.

In some cases today, the economy does not look at Medical Marihuana as a legitimate business. Therefore interest rates or access to capital do not play a major role in Fweedom Collective, for consumers anyway. The company only takes cash or credit cards. Nate mentioned that he could get a loan through his business if necessary. However, what affects the company the most is business loans because banks and financial institutions will not grant them to a business like Fweedom Collective. Nate said its loans come from private investors. Most likely when regulations are officially submitted for Recreational Marihuana, banks will be more willing to loan money.

The most surprising news that can be learned from this interview is the impact Fweedom Collective has had on the community it operates in. Nate elaborated on the positive impact the company has on its small location north of Seattle. “With our business being there it has helped the neighborhood out a lot, cleaning it up, put illegal deals off the streets and into a legal business, and crime rates have dropped.” Nate also mentioned his business has brought money to an area that was demolished and made it more commercialized.

After eight years, Nate Taylor and two of his coworkers, Sky Nielsen and Tyler Godfrey, took an idea and brought it to life. Now at 28, Nate is a successful business owner who is looking to expand in other areas. Though his business is succeeding, the Seahawks are not. They lost 31-34 to the Rams.

 

 

Los Angeles roots for the underdog while riling businesses with proposals to hike the minimum wage.

Mayor Eric Garcetti says his proposal to raise the minimum wage in Los Angeles by nearly 50 percent over three years will boost struggling families above the poverty line, making the city affordable even for busboys, cashiers, janitors and others living off $9 an hour. In turn, he says, these workers will pump dollars back into the economy.

But business owners say the pay boost – which would reach $13.25 by 2017 – could trigger side effects that would endanger businesses and cut jobs. Some companies have said they would consider skipping town altogether. Restaurants and stores that depend on their locations may need to slash labor hours or take a gamble on hiking prices. Entrepreneurs might jump ship into the underground economy. Even businesses outside of the city could wither if compelled to hire L.A.-based companies at steep rates.

At the root of this debate are 3.3 million people nationwide earning the federal minimum rate of $7.25 an hour or less. According to the Bureau of Labor Statistics, half of these people range from 16 to 24 years old, and 77 percent are white.

[Read more…]

With a growing number of cell phone repair stores in Los Angeles, how do they grasp their competencies, how do they survive, when new technology updates and brings new phones to the market every year?

In a 1500-square-foot store on South Figueroa Street in Los Angeles, Nathan Kim sat in front of his work station all alone, covering his eye with a head loupe magnifier and installing the last tiny round widget on the back of an IPhone screen. As soon as he finished up, he put the screen aside, away from the pile of different brass and gray widgets sprawled all over the desk.

Kim opened the iPhone repair store after he graduated from the University of Southern California with a bachelor’s degree in computer science. Seeing the fast updates and replacements in the cell phone market, many people like Kim were attracted by the potential profits and opened phone repair service stores.

In L.A., there are about 40 similar stores searchable on Google Maps. Some stores try to keep their locations concealed. Some of them run in apartment complexes; others provide door-to-door services by making appointments with repairers via phone or Craigslist (a classified advertisements website).

“They are doing home business without a proper license,” Kim said when he found an “iPhone screen repair” service on Craigslist. “This only costs $39 to fix a screen, while I charge $65.

“If there is any problem, they won’t be responsible for that, and their customers will become the victims.” The license he referred to was an Electronic Registration certificate issued by DCA (Department of Consumer Affairs), which hung in front of his work station.

Cutting the cost and keeping the business small but efficient are the core strategies for most store owners. Running the store in an apartment would be less nerve-wracking and probably cost less money than subletting a commercial property. Having only one or three people running the store would also allow each person to take home a larger share of the pie. Also, finding good retailers to supply continuously with cheap phone parts would help a lot.

Regardless the labor cost during repairs, phone parts suppliers have the greatest power of controlling the prices. “When the iPhone 5 was first released, the part (screen) cost about 180 bucks. Now it’s 80 bucks,” Kim said.

Every time a new phone came out, large demand would promptly cause the suppliers to lower the prices of the old phones’ parts. Particularly, the value adjusted a lot when iPhone 5 was released.

“There was a mass production of them (iPhone 5 parts) – the screens, the back plates, the batteries. Everybody needed them. Everything was super cheap,” said Herbert Reyes, the owner of All Wireless World located at East Hollywood. “Repair, that’s the best thing (to earn profits).”

China, the world’s factory floor, has become the biggest supplier behind these dispersed phone repair stores in L.A. “They (parts and accessories bought from Chinese retailers in L.A.) are pretty much the same quality you will get for $35 from somewhere else,” he said.

Purchasing large amounts of parts will give buyers cheaper prices than buying a single part. Thus, the cheaper prices the store owners could get from retailers, the cheaper prices they would sell to their customers. Kim offered the customers discounts depending how the prices vary. Reyes chose a new path by providing a customer discount once they did a check-in or a review on Yelp (an online service to provide consumers with information about local businesses). He would also evaluate the prices offered by the others on Yelp, and then lower his price $5 to $10 below than the average price.

The phone repair business is extremely competitive in L.A., which forces many business owners to compete with the lowest price that they can offer. Most business owners are confident and positive about their competencies.

Since cell phones have become an essential needs for most people, customers who come into the stores mostly need to get their phones fixed as quickly as possible. Having a background in Computer Science and engineering, Kim said he knew the basic structure of the phone, which made him an experienced, fast phone-fixer.

“My customers tried to fix their phone in other places but they didn’t know how to fix it; they didn’t know how to fix water damages,” he said. “I’m pretty sure they will have some problems whenever there is a new phone coming out.”

When the iPhone 5, 5C or 5S first came out, Apple did not only upgrade their iOS systems and cover them with better-looking cases, it also changed their interior design, which made the phones easier to fix.

“The first time I opened an iPhone (4), it took me 4 hours to open it and 2 hours to close it,” Reyes said. “Now I can do it within 20 minutes. (The screen of) iPhone 5 is actually much easier to fix, because you don’t have to take everything apart.”

As iPhone 6 and 6 Plus have been released on Sept. 9, most of the business owners are unsure about what will they do if someone bring a broken 6 or 6 Plus to their stores. Reyes said he would contact his suppliers to make sure they had the parts, so that he could get prepared for any upcoming damages to these new phones.

“I will get myself an iPhone 6. And I will open it to see which part goes with which,” Kim said.

Regardless of dealing with technological difficulties, Reyes values customer services more than anything else. “As long as you do really good customer service, people will come to you,” he said. “There is a well-established strong connection between me and people.”

To make extra profits, many owners like Kim and Reyes expand their businesses by selling accessories, such as phone cases. “People will get a phone, and they will need accessories,” Reyes said. “There is always something to sell.”