Wednesday, September 3, 2014

Mil Muros

I’ve been trying to write a post about the store for some time now, but I haven’t been able to get much traction.  This is partly because the store is such a complicated subject that it doesn’t lend itself to easy summary, it is also because the store itself is so all-consuming that I don’t have many blocks of time that lend themselves to writing posts.  I have one now, sort of, so I’ll give it another whack.

So: the store.  Mil Muros.  Three years in, almost, and I haven’t gone out of business.  At least not yet.   For those of you who don’t know what my store is about, I have the only graffiti shop in Salvador, specializing in spray paint and the specialized caps you need to paint graffiti.  Every graffiti shop also sells markers, usually big ink and paint markers to write tags on the street, but also smaller markers and sketch books.  I have become The Source for such markers in the city.  I also have some clothes and stuff - most graffiti shops need to sell material that allows for a higher markup than spray paint, and many store sell clothing and/or sneakers and such, but I don’t know much about fashion so I’ve extended my offerings to more traditional art supplies, gradually trying to transform the place into the alt art store in Salvador.  This process is ongoing, but I've had an increasing number of clients with no interest in spray paint.  They are very welcome.

 I was thinking about it and if I had to sum up my relationship is to the store in one word, that word would be: hustling.

I am hustling, big time, to keep the store going.  It is more work than one person can do, but not enough for two - at least, it’s not taking in enough to maintain a second person full time - I tried that and it didn’t really work out.  But between the paying of bills and the stocking of shelves and the purchasing of merchandise and the waiting on the customers I have an eternal list of things-I-can’t-quite-get-to that, you know, just sits there and waits.  Because I can't get to it.  I figure we all have these lists, I have at least one more that has nothing to do with the store.  At least two.  Probably more.  Prefer not to think about it.

But as I analyze things three years in I must say that I am cautiously optimistic about how it’s going.  Like I said, I’m not bankrupt, and by one measure I am almost “breaking even.”  By that I mean that if I had just gone out and spent all the money I invested in the business it would be about the same amount that I have taken out in profit over the last three years.  If things keep going as they have, in a couple months I will reach this magical threshold in my mind, which means that everything I have in the store will be the return on my investment, at least what is paid for at that time.  Did that make sense?

By a separate measure I probably have another year to go to break even, but I’m not going to get into that measure.  I would prefer to keep focused on my current goal, thank you very much.  And it probably should be said that without other supplemental streams of income the store would have folded some time ago, but I hustle, so I have separate income streams (thank you Airbnb).

So I said I was hustling - part of what I mean by that is that I have a stack of bills that I am constantly maneuvering to pay, most of my purchases are broken into several payments over a month or two and I have all my bills ordered by date to see what I have to pay today, or tomorrow, or what’s coming up next week.  Cash comes in in waves, as anyone who works in retail will tell you, and a lot of my payments require a good deal of patience.  A lot of my credit card sales work just like the payments I have to make, because here in Brazil a client has the option to pay in parcelas, or installments, on their credit card.  This means, for example, that if they buy 600 reais worth of goods, and divvy it into three parcelas, that I will get 200 reais a month for the next three months.  But I have to wait a month to get the first 200 reais.  Patience!  Debit card payments are received the next day, which is why many store owners offer a discount for debit.  And/or cash.  If I sell something on the internet, my payment processor makes me wait three weeks to receive the payment for whatever I sold, to make sure it arrives at its destination without mishap.  So I spend a lot of time waiting for money to be released to me.  It’s part of the hustle, checking to see if I can get the cash in in time to make the next big payment.  This morning I received 900 reais for a big internet sale, but now I have to wait three business days for the money to be transferred to my bank account.  Patience!!

One of the nice things about the credit card sales is that, since I can't (don't)  keep track of when the payments are coming in, sometimes I check my balance and get a very pleasant surprise.  And the more credit card sales I make, the more money is in the system, and the more pleasant surprises I will receive.

One of the problems I face as a small business owner in Brazil is that I am mildly insane.  Everyone knows that you have to be nuts to open a small business in Brazil.  However, being mildly insane, I am well equipped for the challenge.  Actually, that wasn’t what I was going to say, although I did enjoy the diversion.  One of the problems I face is that borrowing here, for small businesses, is reserved for the stupid.  Or possibly the insane.  Thankfully my own personal insanity doesn’t run in the borrowing direction, or as I have mentioned before, the store would have closed some time ago.  For some reason interest rates here in Brazil are mind numbingly high, usuriously high, stupidly, insultingly, high, to the point where any money I could hope to earn by borrowing would be instantly consumed by the loan shark… I mean the bank… that so graciously made me the loan.

This leads to another aspect of the hustle.  Since I can’t really borrow money, and I have limited money to invest (but then again, who doesn’t?) in the business, I am constantly making tough decisions about what to buy, and how much to buy of it.  Mostly I buy black spray paint, and black markers.  Black outsells everything else.  By a wide margin.  I dream of the day when I can buy a surplus of the material I really need, but for now I have to pick and choose, decide what colors I will buy this month, and leave the other colors for the next purchase in two or three months.  I have a long list of material that I should have in the store, but I just can’t afford to buy it.  Yet.

But here’s the good news - I think I might finally be getting ahead of things.  Lately I’ve found that I already have enough cash in my account to pay relatively large bills without having to borrow from other sources.  Some art teachers at the local universities have been recommending my store to their students to buy their art supplies, and I finally have most of what they are asking for.  My location is lousy - in the basement of an undistinguished building that doesn’t even have a name (most places are known by names here), but it occurred to me that the store is something that I would have loved back when I was in college - literally an underground hidden treasure that few people know about.  Lots of my customers gaze around and sigh and tell me they wish they could buy everything in the place.  Others tell me they shouldn’t come in because they blow all their cash in there.  The graffiti crowd has provided a base, the other art supplies are beginning to provide some real income.  Underground is good, I like being hip and cool, but I also dream of a better, more visible location and more customers.

Another thing that works in my favor: the other art store in town, which happens to be right around the corner, is run by assholes.  They are extremely overpriced, and have a reputation for being rude to customers and completely inflexible.  I also discovered that if a customer walks in there and asks where Mil Muros is, they won’t tell them.  Having worked in customer service previously, and coming from a country that values quality service highly, it seems unconscionable that my competition could act the way they do and get away with it.  But lacking an alternative, not only have they been able to get away with it, they have flourished.  The artists in town are hungry for another option.  And I’m providing it to them.  Twice this week alone I had customers describe themselves as "hostages" to the other art store, and my hope is that they will no longer be so.

The other photos in this post I took this morning - the store in its most recent incarnation, including the ongoing collaboration I have with my clients on the walls.  Below is a photo I prepared two years ago, contrasting what the place looked like just after I opened it to its then-current incarnation.  As you can see, things have continued to evolve.


Adam Gonnerman said...

It takes nerve to run a small business in Brazil. So many taxes and way too much red tape.

markuza said...

Thanks Adam, although I don't relish paying taxes and nobody enjoys red tape, I've come to consider it all part of the hustle - playing the game with an eye on coming out ahead.

StephAnn said...

Absolutely encouraging to read this! I visited Salvador recently and absolutely fell in love with it. This post came up in the search engine in my research about the job market in Bahia. I'm not looking to open a shop, but it's nice to know that it is possible. =]

markuza said...

Thanks StephAnn - I appreciate the feedback. Please don't forget the caveat that one must be a bit insane to do something like this!

markuza said...

Postscript here: The magic 'break even' point I mentioned in this post? I achieved it yesterday! Not that the store doesn't have other debts, but by one important personal measure I have achieved a milestone.

Anonymous said...

Sua loja é muito simpática. Não é moleza ter negócios no Brasil, a não ser que sejamos empreendedores natos. O ramo que você escolheu (tinta para grafitar) é muito restrito, né?