2/16/2010 by Patrick Garmoe

(Photo by Patrick Garmoe: Tami LaPole Edmunds strings beads for an upcoming art project. After 22 years in the business world, she was laid off last year.

On a frigid January day, Randy Broin gazes out his office door. Where others see a series of model homes encrusted in snow and ice, he visualizes a victorious spring of home sales.Broin is the newly minted founder of Amity Creek Homes, which sells the Wisconsin Homes line of modular homes.

Across the bridge in Superior, Tami LaPole Edmunds strings together beads in a blossoming artistic business called Art in the Alley.

Both are passionate about their new ventures, and each stumbled into the opportunity partly because of the recession changing or eliminating their old sales positions. Broin became the owner of Amity Creek Homes in August, after 14 years with Easy Housing, later purchased by Bullyan Homes of Hermantown. Instead of staying on with the new owner, Broin accepted an invitation from Wisconsin Homes to open a franchise selling just its line of model homes priced between $70,000 and $500,000.

Instead of being part of a large organization with 30 or more FTEs, Broin has chosen to heads an office of two full-timers and one part-timer. When he needs to build a home on site, he relies on a multitude of independent contractors, avoiding significant overhead in the process.

“Being small gives you the opportunity to react quickly” to market swings, he said. “I want to be small and just do a phenomenal job for my customers.”

Meanwhile in Superior, Edmunds had a great job she loved, booking a private estate for corporate retreats. A career woman, Edmunds had spent 22 years in the corporate world. Her 2009 layoff came as a surprise.

But in May 2008, Edmunds and her husband Dan had opened Art in the Alley on weekends; envisioning the store as a way to pursue their hobbies, not necessarily leave their day jobs.

Partly because she loved her full-time job so much, and because the art gallery didn’t come with a guaranteed annual income, she knows she would have never made the leap to fulltime self-employment, had her position not been eliminated last year.

“We had kind of talked about the fear factor. How do you replace a pretty good income with an unknown?” she said.

While having your own business is much more of a challenge than working for a steady paycheck, she said it’s also a wonderful feeling to be working to improve your own business, not someone else’s.

Whether you’ve saved for years, or decided a layoff has given you the opportunity to pursue your dreams, adequate upfront research and writing of a business plan is critical to building success, said Jennifer Young, a business developer with the Northeast Entrepreneur Fund. She’s an entrepreneur herself with the company Cookie Temptations.

“If they don’t plan it out, prior to jumping in, they aren’t going to have any working capital,” Young said. It’s the business plan that keeps you on track, she said.

That’s the major hurdle Broin faced with his new business.

Based on experience, he knows his home-selling business will heat up with the weather. But to be up and operating when the customers come, he had to start the business last August, as things were about to slow down for the year. He ultimately got the short-term financing he needed through the Entrepreneur Fund, and is confident 2010 sales will provide at least enough operating capital to get him through next winter.

Young said no matter how much research a start up business owner begins with there will be surprises. Therefore, it’s critical to write a business plan with price quotes in writing, so actual costs aren’t double estimates.

Young said it’s also critical to accurately gauge profit margin, so you can determine how many customers are needed to calculate the revenues needed to cover expenses. Too many would-be entrepreneurs, and some already in business, rely too heavily on guesses and gut feelings, Young said.

“A lot of people can’t tell me how they’re coming to their projections,” she said. So what often happens is they launch the business with a lack of capital, and end up running out of money, she said. Her organization boasts an 85 percent success rate for businesses that go through the business-planning seminar.

Patrick Garmoe is a freelance writer and social media specialist for PureDriven.com, a Two Harbors-based Web analytics company.

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