7 reasons why Staten Island small businesses fail

STATEN ISLAND, N.Y. -- When Adriana Peri opened her own business, Peri's Pearl Tea, at 23 years old, she felt she was destined for success.

Selling a niche product -- bubble tea -- Peri, now 25, felt she had created a unique business right in her home community of Tottenville.

What Peri didn't think about, she admitted, is the obscure location of the business, which is located on Page Avenue, but not on a main retail strip.

Peri said she chose the location due to it having a lower rent rate than high-profile locations on busy retail strips.

"There's not enough traffic on the South Shore as there is on the North Shore, or there is by the (Staten Island) Mall," said Peri, who will close her store on March 1.

"I love the business, and I wish I could keep it open. We were making the money to pay the bills and the employees, and there was only a little bit left over for ourselves. But we needed the extra traffic and people to make a bigger profit each month to be able to stay open," she added, noting she is selling the business.

And Peri is not alone. According to the Small Business Administration (SBA), about 50 percent of businesses fail during the first year of operation.

"Some people go into business on a wing and a prayer. They don't really realize they need to have a main financial reserve for certain things," said Dean Balsamini Sr., director of the Small Business Development Center at the College of Staten Island.

"It takes about a year to go through all the seasons to find out what the pluses and minuses are in a particular business," he added.

REASON #1: LACK OF RESEARCH

Some experts say small businesses fail because of lack of research about the business, area or operation cost.

"It depends on how wide open your eyes are when you open that business," said Ted Potrikus, president and CEO of the Retail Council of New York State.

"What happens to a lot of small business owners is there's some excitement at the beginning, then the bills start to come in, and the people aren't coming to the door. And your Facebook page isn't generating what you thought," said Potrikus.

Linda Baran, president of the Staten Island Chamber of Commerce, said many times new merchants just don't understand the expense associated with running a business. "I think a lot of people don't do their homework," she said.

REASON #2: BAD LOCATION

Johnpaul Perrone knows all too well how choosing a location for a business is important. He and his wife, Dana, opened Papa Perrone's Rice Ball restaurant on St. Mark's Place in St. George in February 2013. But they closed in April 2014.

"We thought the area was great. We figured the courthouse would be opening, but it was delayed. We knew the NY Wheel was coming, and we figured we'd get our catering in place," said Perrone, noting before opening the restaurant the couple owned food trucks in Manhattan, which were very successful.

"People would say, 'You're all the way over here,' referring to Stapleton. I would say Stapleton is 'five minutes away'," he recalled, noting a financier also backed out soon after opening.

REASON #3: IT'S NOT EASY

Most merchants who fail within the first few years admit that running a business isn't as easy as they thought.

"Sometimes it turns out to be a lot harder than one might have thought when they open that door. And the excitement gets replaced by the reality," said Potrikus.

"In retail, if you want to compete, you really have to be open seven days per week, and you need your location to be someplace that's easy to drive to, or near public transit. If people can't get to you or you don't have a web presence, this could lead to a business failing. There are so many things to juggle today,"  he added.

Janine Detore -- sister of the late Mob Wives' Angela "Big Ang" Raiola -- opened "Bee Tween," a clothing and accessory store for tweens, in August 2015 on Forest Avenue in West Brighton, only to close the store in less than a year.

Detore, who purchased the Country Mouse -- also on Forest Avenue -- eight years ago, said she didn't realize how hard it would be to run both businesses.

"I closed in May 2016. The rents were a little high. I was paying $3,000 (monthly rent for Bee Tween). He (the landlord) actually went down (in price) for me," said Detore, who noted the Country Mouse has been open for 44 years.

"In my case, I kind of dropped the ball. I was running both businesses, and taking care of my sister (Big Ang). To run both businesses I was closing the Country Mouse a lot to be with my sister for her treatment," she added.

REASON: #4: ONLINE COMPETITION

Studies show that between 75 percent and 79 percent of people nationwide shop online.

Thus, the convenience of shopping online -- especially from retailers now offering free shipping with the promise of speedy delivery services -- has hurt mom-and-pop shops across the country.

"You can do anything online and your price points are probably cheaper," said Balsamini. "You can try on clothing or see an item locally in the brick and mortar store then purchase it online."

REASON #5: NO PARKING

If you live on Staten Island you likely have a car, and you also know it's hard to find a parking space for any destination that doesn't have its own lot.

"There are some businesses for which people will walk a couple of blocks, but others if they can't park, they won't go. It depends on the business," said Baran.

Those businesses for which people are willing to scramble for parking are often service-oriented or high-demand businesses, she added.

REASON #6: ONLY OFFERS PRODUCTS

Balsamini said many Staten Islanders patronize local service businesses.

"With a high median income here on Staten Island, people can be -- and are --selective with services. Personal service organizations are in demand," he said.

Said Baran: "Offering a service, like opening a hair salon, has more chance of success in certain cases."

REASON #7: 'TOO MANY REGULATIONS'

Small business owners on Staten Island have complained about city and state regulations, such as the hike in minimum wage, for which they have to comply.

"You have the city, state and federal regulations, and you just throw your hands up and say, 'It's not worth it. It's too hard,' and you then go to work for somebody else," said Potrikus.

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