Final day of 2007

Wow, 2007 will go down in history as one of the most eventful years in my life! Tracy and I have really been "hopping" in 2007. Here is a quick recap:

We started the year having already signed our lease, and were in full Demo mode. I had completed six or so weeks of construction late in 2006, only to find out from Regional Bldg Dept that our proposed layout would not work. In order to utilize that much square footage for the cafe, we would have had to reconstruct the entire store front, adding very expensive UL listed fire doors with crash bars, as well as install double stall bathrooms for both men and women.

We completed the framing of walls in January 2007 and began working some business organization logistics. We continued construction in February, and even received our building permit on February 17th (after that, we were able to take down the coverings on all of the front windows). February had it's own challenges, including dealing with Colorado Springs Wastewater Division of the Utilities to resolve the grease trap issue, working with Regional to resolve the issue of previous fire damage in the building's electrical distribution system that was never repaired to code, and in dealing with Ethan breaking his leg!
March brought electrical and plumbing, as well as drywall and paint. Ryan and I began some extensive custom wood work, which is one of the major contributors of the 'character' of the shop! We also began advertising for hiring, expecting an early April opening.
April 2007 was a complete construction frenzy! I personally laid all of the hardwood flooring in the studio, kids room, and the cafe. Rob and Ryan laid way, way more slate tile than we had originally planned. I think it turned out to be one of the best decisions, and I kind of wish the entire cafe were slate tile. We also dealt with incorrect electrical wiring which blew up our brewer, and incorrect wiring for our espresso machine. We also wrapped up the drop ceiling (via contractor), finished the cabinet installs and custom woodwork, etc. We had experienced several delays for our expected open date, but I promised Tracy we would get open by her birthday. I spent the night of April 25th in the wood shop and at Nemo's wrapping up last minute priorities. It was an all-nighter, and I was completely exhausted from a very crazy several months of construction. But... at approximately 9:00am, we received our final blessing from the El Paso County Health Department and we opened for business on Tracy's birthday (I spent much of the day asleep in the kids' room)!! Woo Hoo!

We watched sales build quickly, and we were able to show profits of $14,500 in our first six months of operation. We paid our selves $6500 and spent the other $8000 on additional equipment purchases and upgrades. We learned very quickly that our shop is very slow around holidays, and November and December have been below average months for us, as compared to the first six months. We are looking forward to bouncing back in early '08.

Of our original hires (Michelle, Artie, Pam, Nicole, and Dion) we still have Artie and Michelle. Our new hires have been James, Robert, and Vanessa. Vanessa just finished her last week with us, and Tracy is currently interviewing for a replacement.

Our personal finances have suffered, having gone from Dec 2006 until October 2007 with basically no income. We were prepared to go a year or more without a personal income, but Ethan's broken leg cost us $4000, and we ended up with an empty rental house that costs $1000 per month for the payment and utilities. I went back to work in October 2007 at Intel, performing their site water chemistry control scope. Although it pays well and I enjoy what I am doing for them, it is a temporary position since they will be closing this plant in early 2008. My contract with them is currently through March 2008. As a result, I began a job search, looking for something in Construction Management or Project Controls, which is my career background. I thought it would take a few months to land a solid position, but I found a job with RK Mechanical almost immediately, as a Project Engineer on the Fort Carson expansion project. Our scope is all mechanical (HVAC and Controls, all plumbing and wastewater systems, as well as radiant heated flooring, hot water boilers and distribution, etc). We have five 4 story barracks to build, as well as three TEMF's (Tactical Equipment Maintenance Facilities). This construction is to accommodate additional troops being assigned to Ft Carson by 2011. They announced last week that another full brigade will be reassigned to Ft Carson by 2013, which will result in another $170 million in construction efforts! I may be busy there for awhile...
In the meantime, I am working the Project Engineer job during the day, spending a couple of hours with Tracy and the kids, then working the Intel scope at evening/night. I did not want to back out of my commitment to Intel, as I have many friends there from the last seven years. It would be very difficult for them to bring someone in to take over my scope for just three months. It is difficult, but I am getting enough sleep, and having two full incomes will help us to rebuild our personal finances! Although this is hard, I am very thankful to have both opportunities.

Another big part of 2007 has been my photography. I shot numerous senior photos and family portraits this year, and that income really helped (it was before I went back to work). The photography income bridged the gap and looking back on it, I realize it was a necessity, not just a nice to have 'side income'. I have pretty much stopped all photography efforts since I am working two jobs, plus working 10 or so hours at Nemo's a week. I am looking forward to resuming the photography work next year when the Intel scope is completed.

Tracy and I have also continued to volunteer at our church, but we are working in the nursery instead of teaching a Sunday School class. It is much easier to show up and hold crying babies than to prepare a lesson and crafts for 20-30 kids. We enjoyed teaching, but just don't have the time resources to do it well right now. So, Babies-R-Us for now...

Josh, Jonah, and Ethan have done well this year. They rarely have to spend time at the shop, and typically enjoy their time when they are there. Since we are so busy, it has made us take a very close look at our schedules, and to insure we are spending significant time with the boys. Almost all of our non-work time is spent with them, and I think we have more quality time as a family than before we opened the shop. Having fewer time resources makes us appreciate the time we do have, and we use our time much more wisely now...

Thoughts on 2008...
We will be doing some marketing and advertising for the first time ever in early 2008. We have had success so far, but we have not even begun to reach the 18,000 daytime workers that commute into the area (one mile radius of the shop).

I will continue to work two jobs until the end of March. I'll keep you posted on things after that (Intel may extend my contract, unless they are able to sell the site).

We will be joining the YMCA early in January. We don't have time right now to have the kids in basketball, soccer, baseball, football, judo, etc... Instead, we will be taking them swimming, playing racquetball, etc at the Y, and we will be starting BMX bike racing and mountain biking when weather clears in the Spring. Those are all activities that we can do on our own without regard to schedules.

We have not had a family vacation in a couple of years, and we want to make that a priority this year. Tracy's parents have wanted to take the boys to Disneyland, and we are looking at Memorial Day as a good time to head for Florida! It will be fun to see Orlando again. I lived there for a year in 1984-1985 when I was in the Navy's Nuclear Power Program.

Well, it is 1:50am and I need to finish my lab work here at Intel. I need to wrap things up and get home by 3:45 or so. That is when Tracy gets up to go to the shop...

Everybody have a safe New Year's celebration. Have fun, but don't get all crazy!
Take care,
JD

Here are a few of my favorite photos from 2007 (I literally have thousands more that I don't have time to go through... these are just a few favorites from the few I had time to edit and post). You can click on them to see a larger version. Use your 'BACK' button in your browser to return to this page.

Merry Christmas!

I would like to say Merry Christmas and thank everyone who has been a part of Nemo's this year. This goes out to our employees, our vendors, our customers, and to family and friends who have encouraged us. I hope you have all had a wonderful Christmas!

As for us, Christmas is not quite over, since we still have to mail our Christmas cards, and I still have a couple of presents to wrap and send to family in Indiana... When you are a procrastinator, Christmas can last for as long as you like!!

As for the shop, we have hit a few milestones recently. We have served over 21,000 customers in 8 months. I had planned to post when we broke the 20,000 mark, but I missed it, so... you get 21,000.

We average just over $4 per sale, and as a result, we are over $95,000 in sales and rapidly approaching the $100,000 mark! Woo Hoo! I'll keep you posted...

We sold 102 gift certificates in 2007, with most of those (approx 75) being sold in the last two weeks. Those sales do not show up in revenues yet in our POS system. Those sales will show up as the certificates are redeemed.

Tracy is changing our hours to close at 6:00pm instead of at 8:00pm beginning in January. I'm interested in seeing how that will work out. Her plan is to not cut labor hours, but to use those extra labor hours during the day shift to boost sales during our busier times. I'll let you know how things are trending.

I've completed my first week of working as a Project Engineer at Fort Carson, and continuing the water chemistry control scope at Intel. I was able to perform both scopes, spend time with the kids, and still get enough sleep (enough for me, probably not enough for the average person). I can do anything for three months...

Everybody have a great New Years...
JD

We are still here!

Wow, have we ever been swamped. I don't have much time, but wanted to leave a quick note to let you know we are still here!

As expected, December has been slower than normal. We plan to get through it, and get aggressive in January and February to boost sales.

We had our staff dinner at Mirch Masala on Saturday night. It was very good Indian cusine, and then we went to see Bourne Ultimatum afterwards. It was a fun night.

As for the coming new year, Tracy has been evaluating our night time business. I crunched some numbers, and in the last three months we have shown $400 in profit during the 6:00pm to 8:00pm timeslot. We have had several special events (live music, group holiday parties) that account for more than $400 in sales during that time. Basically, that means the shop has been roughly breaking even during that timeslot over a three month period (if you take out the special events). Tracy's plan is to start closing at 6:00pm instead of 8:00pm starting in January. She wants to take those labor manhours and pull them into the dayshift to assist with catering to Premiere and Time Warner. She feels she can develop better sales with those labor hours during the day than we are getting at night. We are also looking at being open on both Saturday and Sunday for half days. We are currently open half days on Saturday, but Sunday would be a new endeavor. There are lots of churches in the vicinity, and we can distribute fliers to them to let people know we will be open. We should be able to develop a decent following on Sunday mornings with local church-goers... We go to church on Saturday night anyway, so it does not affect us in that manner.

I started a new job as a Project Engineer for RKMI (RK Mechanical, Inc). RK is the largest HVAC/Plumbing contractor in Colorado. It is a privately owned company and is non-union. Knowing that Intel is a temporary situation (Site Water Chemistry Control) I started looking for a job, hoping to line something up before my contract at Intel ends at the end of March 2008. I thought it might take a few months to find something decent, but I found the position with RK almost immediately. My project scope involves the expansion at Fort Carson (Army Base here in Colorado Springs). We are doing the HVAC and plumbing for 8 new buildings, including three Tactical Equipment Maintenance Facilities and five 4 story barracks buildings. I will be continuing my scope at Intel in the evenings. Although I will be very, very busy, I will still try to post the shop's progress every week or so.

Gotta run...
Take care,
JD

11:30pm and the power is back on!

I turned off several of the circuit breakers for large loads, shut down the computers, and waited for awhile. I had no idea how long it would take for the power to come back on, so I made a bed in the studio. I took the upholstered cusions off the Stickley mission style chair in the cafe and used them for a bed. Table cloths worked for a pillow, and one of my muslin studio backdrops worked for a blanket. I got a good half hour nap before the adjacent business owners started showing up and talking very loudly to each other. They all congregated outside our shop because we have emergency lighting on battery backups and it works for quite a few hours. They were all trying to figure out why we had power and no one else did.

I've restored power to everything, confirmed no other breakers tripped, and got the point of sale computer back up and running. I'm going home...
Later,
JD

Been Awhile...

Wow, did the last two weeks really fly by this fast???

I guess so...

Here are a few key events:

We have had several highly successfull Photoshop classes in the studio. I really enjoy teaching, and it forces me to expand my own knowledge in Photoshop. I love having the digital projector! The kids love it for watching movies 14' wide on Saturday mornings when they are at the shop with us.

The Photography Group continues to have great meetings, and great participation. We are currently showing work by the group for our gallery exhibition. If I remember, I'll bring a camera and post some photos of the shop with the artwork up.

Tracy is hosting an Arts/Craft fair on Friday December 7. It will start in the morning and last all day. She has lots of artists participating, and I honestly don't know how she is going to fit everyone in... I need to break down my studio strobes/stands, backgrounds, etc and store them before Friday.

I have organized the Photoshop and Photography groups through www.meetup.com and it has been a great mechanism for publicity and organization for the group events. Tracy is going to start a meetup group for artists and begin having biweekly drawing groups here at the shop. The arts community in Colorado Springs is very disjointed and not organized. If Tracy makes an effort to organize an event that caters to artists, I think it will take off like my groups have.

Jeff Caylor is playing live again this Friday! It will be his third live show here at Nemo's, and we are really looking forward to it. Check out www.jeffcaylor.com for the latest news on his CD release. It is quickly accumulating lots of awards and recognition as one of the best indie album releases of 2007! By the way, Jeff was born and raised in Anderson, Indiana, which is my hometown!

OK, now for the bad news... We have proven over and over again that our location absolutely dies around holidays. We don't just suffer on the given holiday, but the entire week is typically slower than ususal. Well, we are finding that November sales were off our trend by about $1800. That is not a huge drop, but it does hurt since December is our first month at our full budget. Writing a check for $2800 in rent was painful... With slower holiday sales, we are operating under the break even point, which means we are burning capital dollars. We are prepared for that, but I don't like seeing it. Nemo's has performed above expectations right from the start, and revenue growth outpaced our expense growth (with negotiated step increases in rent over time). I looked at some of the numbers, and from April 07 to Oct 07 was very good to us. During that time, we paid ourselves $6500, and we spent an additional $8000 on new equipment, both for the cafe and for the studio. To perform $14,500 above your break even point during the first six months of operation is stunning! Finding ourselves a little below break even now is tough to swallow given our track record up until the holidays hit.

OK, so what are we going to do about it?
1. We are not going to stress about it during December. We have a proven track record of slower than normal sales around any holidays. We expect December to be in the red, and we are just going to get through December without any stress or anxiety.

2. Once January hits, we are going to aggressively tackle some inexpensive marketing. We are having 120" x 36" banners hung on the front and the back of the building. Our signage is not great, and we don't want to invest in signage since the property owner intends to upgrade the building facade soon. I am working on a flier and will send it to a print press to have 10,000 copies made. To this point, we have only reached the large buildings within walking distance of us. There are another 14,500 employees within a one mile radius of us. Some of the industries close to us that we have not marketed to:

Olympic Training Center
Memorial Hospital (largest hospital in the city)
Regional Building Department
El Paso County Health Department
Printers Parkway is innundated with medical complexes, way too many to count (1000's of people)
Memorial Hospital Admin Building (800 people)
Colorado School for the Deaf and Blind (huge campus right up the street)
The Gazette (Colorado Springs only newspaper, a very large complex, lots of employees)
I could go on and on... There is an enormous unreached market out there just 5 minutes from our front door by car.

Tracy is going to aggressively pursue the catering to Premiere Global and Time Warner in the Chidlaw building directly behind us.

Tracy is flirting with the idea of closing at 6:00pm instead of 8:00pm. Over the last two months, we have paid more in labor dollars to operate those hours than we have brought in in sales revenue. The challenge I see there are the groups we have scheduled to use the studio for events at night. If Tracy goes this route, I will come to the shop at 6:00 and stay for the events. We have solid bookings for every Tuesday for the indefinite future. The photography and photoshop groups meet at times when I am here to participate anyway. I will be able to stay at the shop and take care of things by myself during those times when it is necessary. That will allow us to continue to pull in the revenues generated by the groups, but cut labor costs to exactly Zero dollars!

What is the advantage? Well, Tracy can take those labor hours and dedicate that budget money to implement the catering to Premiere and Time Warner. We were considering hiring another daytime person to facilitate the catering. Closing sooner and pulling that labor to earlier in the day will give us the opportunity to use those labor dollars in an endeavor that should have much higher revenue returns than our slow 6:00 to 8:00pm timeslot.

OK, that is enough for now... It is after 10:00pm and I'm still at the shop.

Oh great, the power just went out. I saw a bright flash of light and heard an explosion from the transformer about a block down the street.
I looked outside and there are no city lights for as far as the eye can see. No buildings, no street lights, no traffic lights, nothing...
I've got to post this and shut down the computers (they are on battery backups).

Looks like I may be sleeping here tonight. I will have to stay until the power comes on to insure all of the refrigeration and other large loads do not trip any circuit breakers when everything comes back on at once...

Good night,
JD