How to succeed in business

Three entrepreneurs and one city councillor discuss the tribulations of small Winnipeg businesses

Nils Vik, owner of Parlour Coffee in the Exchange District, says government red tape has the potential to cripple small businesses looking to start up in Winnipeg. Matthew Zylstra Sawatzky

The successful opening of Parlour Coffee, a new café in the Exchange District, raises the question of the feasibility and practicality of opening and running a small business in Winnipeg.

Nils Vik, the owner and founder of Parlour, found attaining certain permits to be an unduly lengthy process.

“The city was always very friendly and helpful but they were just slow,” said Vik. “If someone wants to open something downtown, I don’t know why (the city doesn’t) try to jump on it.”

Vik explained that for someone investing their entire savings into a new business, waiting for the city to grant them permission to open can be discouraging or even fatal to the business.

“Every month I had to pay rent without making any sales,” he said. “I would say most people, if they were not so passionate about their businesses, would give up.”

Though Justin Swandel, deputy mayor and chair of the downtown development committee, was unable to comment in person on such delays, he offered some explanation via email.

“In many cases delays are caused by the project proponents when drawings are incorrect or incomplete and the appropriate professional stamps are not in place,” wrote Swandel.

Winnipeg classifies and licenses 27 business types ranging from food handling establishments to escort agencies. However, these umbrella policies often force owners to adhere to unnecessary regulations.

For instance, Vik said the city essentially regards his store as a full-fledged restaurant. 

“I had to put a grease interceptor into my sink, even though I don’t do deep frying,” said Vik. “I realize it is in the interest of public safety, but they are not really willing to bend.”

Scott Bagshaw of Deseo Bistro also finds grease trap regulations surprising.

“Winnipeg now has a grease trap inspector,” he said. “I thought someone was playing a trick on me when I heard this.”

For Avi Waldman, owner of All City Modern Convenience, Interac is a Winnipeg business inconvenience.

Waldman explained that when a customer uses Interac their income is removed from their account instantly, but a business owner is not transferred the funds for several days. This delay potentially prevents owners from replacing out-of-stock items, purchasing new products and paying bills.

“For a small business, Interac is deadly,” he said. “I would spend maybe $100 on tobacco and if 80 per cent of my clientele were using Interac, I would not have any cash for it by the end of the week.”

“I am using all my profit to get a new item every week and if I am playing catch up with Interac there is no room for growth,” he added.

Swandel emphasizes the importance of planning and familiarizing oneself with small business laws.

“If someone is investing a large sum of money in a business, they should be taking the time to understand what is required and carefully plan the timelines,” he explained. “They should also use reputable contractors and consultants who have a proven track record and are familiar with the process.”

Alejandro Mora, who co-founded Deseo along with Bagshaw, agrees that a business plan is essential.

“You need to know what you’re getting yourself into,” said Mora. “Little things you would have never considered will make themselves apparent once you create a business plan. Little things, (such as) sugar for coffee, which you would consider unimportant, become a large part of your expense plan.”

Bagshaw contends much of the key to success lies in hired help.

“Have a good lawyer and an accountant,” he said. “And a lawyer. Did I mention get a lawyer?”

Published in Volume 66, Number 4 of The Uniter (September 22, 2011)

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