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More Businesses Shutting Down than Starting Up

When I was researching for a now-nixed business concept the main issues were costs for bringing buildings up to code: Pay for inspection, hiring a crew, purchasing the materials needed (etc). All this is cost related - and my store concept was retail, so things like air filtration systems and other high cost elements were at a minimum.

But imagine being a restaurant: higher restrictions in regard to materials used - things like 'the distance between the nearest food-prep area and dinning area' are regulated, too - as are the filtration standards for equipment.

In some ways some regulation changes are for customers safety and they really do make sense.

However, that doesn't mean they aren't costly - and business concepts rely on a balance of cost and revenue.

One small change here, one new addition to the registry there, one advancement in filtration here . . . and those costs add up.

They do add up, but do we have a shortage of places to eat? There are at least 30 restaurants with a one mile radius of my business, and probably over a hundred within a ten mile radius of my home. Obviously these expenses aren't preventing too many restaurants from starting up.

Don't get me wrong, I totally understand that regulations to affect business decisions, but they are supposed to do that. When I built my commercial building, I ended up making it one foot shorter than I had originally intended, so that I would avoid some regulations which were based upon sq footage. If I had been a little richer, or if my business would have been a little more successful, I would have likely not even worried about those things though. That's the great thing about the American small business owner, we are flexible and solve problems creatively.
 
Obama's socialist policies?

Do you mean socialism for Wall Street?

He is a socialist in the same way Hitler or Mussolini were. ;)
 
Obama's socialist policies?

Do you mean socialism for Wall Street?

He is a socialist in the same way Hitler or Mussolini were. ;)

As was Bush. There is little difference between the parties these days, aside from rhetoric that they preach but don't practice.
 
As was Bush. There is little difference between the parties these days, aside from rhetoric that they preach but don't practice.

Obama governs like Bush on steroids.
 
Obama governs like Bush on steroids.

Pretty much.

As much as we love to complain about Obama, if we would have elected most anyone else from either the Dem party or the Repub party, 99.9% of the policy would have been the same.

We actually would have likely had much more growth of government spending if we had elected a republican, we always do. Thats because republicans are only concerned about the growth of government and deficits when democrats are in charge, so republicans would have been passing pork spending bills left and right, and dems would have been happy to join in on the action. With a stalemate in congress and a dem as potus, spending is almost always restrained.
 
They do add up, but do we have a shortage of places to eat? There are at least 30 restaurants with a one mile radius of my business, and probably over a hundred within a ten mile radius of my home. Obviously these expenses aren't preventing too many restaurants from starting up.

Don't get me wrong, I totally understand that regulations to affect business decisions, but they are supposed to do that. When I built my commercial building, I ended up making it one foot shorter than I had originally intended, so that I would avoid some regulations which were based upon sq footage. If I had been a little richer, or if my business would have been a little more successful, I would have likely not even worried about those things though. That's the great thing about the American small business owner, we are flexible and solve problems creatively.

An established business is given flexibility when new regulations are introduced - they have to comply within a certain amount of time. Sometimes regulations won't affect long standing businesses at all, sometimes they do. Yet others are often stung with lawsuits (new regulations regarding the disability act come to mind: wider aisles, handles that aren't round - etc - some lawyers make circuits and seek out businesses that might not be up to standards and then press a suit against them. Good money, apparently, for the lawyer)

Also, upgrading equipment, for example, is a small cost spread out over time. A new business has to cover it all up front which boosts starting costs and makes it harder to raise capital.

A lot of people find the hassle to just not be worth it.

In my view: sometimes this is a good thing - we don't need a glut of businesses by people who aren't quite business savvy. If someone sees the measures necessary to start a business to be not worth it then there are many things about running a business that might prove to be too demanding, too.
 
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