Really need advice - stuck in a long lease!

[rachael204]

I am hoping that someone can help me!

Long story short - I have 7 years left on a 10 year lease. I am seriously struggling, cannot afford the weekly rent let alone all the salon bills and products etc. Things were ok until the hairdresser I sublet to left with no warning and I have not been able to find anyone else to rent from me.

My landlord agreed to let me pay half rent (with the other half still owing) which has been a struggle for the 5 weeks so far. I am having to put salon bills on my personal credit card to avoid getting court action for non payment of business rates and the phone line being disconnected.

So in the last 5 weeks I already owe myself nearly £700 and nearly the same to the landlord.

I am trying promotions, offers, etc but the customers are just not coming through the door in high enough volume to make a dent in it.

The landlord (who lives above my premises) is now coming in everyday, checking up on me, commenting on how I run things - sometimes when I do actually have a customer. He even let himself in the other day when the front door was locked, good job I wasn't doing a treatment.

I really can't go on like this, I already suffer with depression which I try to manage and this really isn't helping!

Sorry for the long post, but if anyone has been in the same sort of position I am looking for words of wisdom, advice, anything really!!

Thanks xx

 

[EMMA AT ELITE]

Just want to send you a hug :hug: you poor thing.

You said things were ok until the hairdresser left, so I am guessing this is the best place to start, I know you said you have not been able to find anyone to rent from you, where abouts have you advertised? How about on here? Post in the hair geek? Ads in the local collages? Even on your profile on facebook "hairdressers chair to rent in hrh beauty salon - please copy & paste to spend the word"
Have you put an ad in your salon window/ reception area?
If not a hairdresser, how about a colourist or hair extension specialist?
What about getting a nail desk in that area & renting that to a nail tech?

Is it a big salon? How many rooms do you have?
Could you maybe rent a room to a holistic therapist, reflexologist, botox doctor, chiropractor, oestopath, reiki healer, anyone!!! Maybe one your day(s) off?

What is your most popular treatment & least popular?

How about doing something like book & pay for 5 massages & get 2 free? Or any bulk treatments, that way you can get some lumps of money in quick.

I think that is really bad that your landlord just comes in even when the door is locked, & every day. Can you not speak to him about this? Say its not good for your business & unprofessional talking about personal matters in front of your clients, say it makes you & the clients feel uncomfortable. The salon I rent my room from I dont think our landlord even has a key! Get the locks changed!

If I think of anything else I will let you know.
Chin up hun x:hug:x

 

[persianista]

Firstly, do you trade as a sole trader or ltd co? Do you have the head lease or a secondary lease? The reason I ask is that even if you want to give up, you are liable for the rent. If you signed on behalf of a ltd co it is easier to get out of.

I would stop the special offers unless you are offering extra free. Any offer that reduces the money going in your till will not help you.
Open longer hours as this costs you no extra and will increase revenue. Keep on advertising for a hairdresser as well as all the extras that Emma suggested in the above post. Cut your costs to the bone.

All salons go through tough times, people wanting a salon rarely realise that. It can be scary when you are not earning a penny and you realise that you cannot walk away from commercial property. Your landlord has actually been very kind letting you pay half rent. He could take you to court for non payment, so accept that he is trying to help, rather than antagonise him. You signed legal documents agreeing to pay him for the term of your lease.

In short, you have just got to keep going, keep trying, and grow an extrordinary strong backbone. We are a here to listen, help and advise.

Chin up and carry on.

 

[SJK]

It sounds like things were ok until the hairdresser left? If so, why not look at getting another hairdresser in (or somebody else, anybody). If not, you need to relook at things altogether.

One thing that may help, I've noticed your website link isn't working. You've obviously got a website up and running, and a website really helps so it would be worth getting it active again.

Best of luck

 

[fozzyo]

See if you can get some free legal afvce from your local business link. Entry to propert you rent without written notice could be grounds for breach of contract which will give you a get out.

Mat

 

[fozzyo]

Also if hairdresser left without giving notice on there sublet they may still be liable to pay you rent. Check your contract with them on termination etc. Then use a debt collection agency to get owed money without cost to you ( well no more then a very small amount)

Mat

 

[persianista]

See if you can get some free legal afvce from your local business link. Entry to propert you rent without written notice could be grounds for breach of contract which will give you a get out.

Mat

No it won't, especially given the circumstances that he is allowing her breathing space. Please don't give false hope that she can walk away from a commercial lease. In reality it is difficult.

 

[fozzyo]

Thats why I said seek legal advice and could.

 

[Helen v]

Hi, if you really cant keep things going check your lease agreement some leases do give you a get out clause, alternatively you should be able to put it up for an assignment, however you will be liable for the cost of this (in terms of the agent) but not necessarily any legal fees as this can be made part of the agreement for the person that takes over. It is a VERY tough decision to make. We had a retail outlet along side our salon and were hit very hard at the start of the recession and had to let it go, our only way out of the lease was to get someone to take it over (assignment).

I do feel for you, but there is always a way. hth xx

 

[rachael204]

thanks to everyone for all your help and advice so far - looks like I have got a lot to think about!

xxx

 

[Terese]

Sending big hugs

At the end of the day - you have to think is it worth the stress continuing?

What is the landlord going to do - hes keeping you there making gestures with half rent amounts as he knows you dont have the money and he wants some money(after all he will have to pay rates on prop after 3 mths if he doesnt let it)

Have you thought of approaching another Beautician? Putting a big ad in the window - hairdresser/beautician wanted - nail tech wanted.
Have alook outside your front door and see how many potential clients there are - ring the local paper and invite in for a free treatment in exchange for a write up.

I dont know the area your are in or your personal situation but if you dont have the money - lease or no lease theres no money to be had, worse case scenario landlord takes you to court- but if you personally dont have any money, hes not going to get the amount of money he wants is he?

it is easier if your ltd as the debts etc are with the company name as been mentioned before.

What you dont want is your health to suffer - depression to spiral downwards - lm sure you have but make a list of all your outgoings last month and this month - see it in black and white -

I wouldnt get myself into personal debt over a business, your local cab or business link would be a good call - take your lease, your outgoings, what arrangement youve come to with your landlord, how your funding through your difficult time.

Most of all I would say that you have to think, do you want this? If you do - take positive steps, approach your bank, why dont you employ a hairdresser on a selfemployed basis?, tell your bank about your expansion plans - getting a hairdresser in - apprentice programmes offer money. If you take on someone whos been unemployed you get some money for 3 months - this would enable you to do more work.

I woud be doing the right thing by myself in this situation - and only you know what that is:hug:

This reply is my own personal opinion in answering the question.

 

[~cHeRiSh~]

:hug:

I would definately look at getting advice from all available sources - legal, business link etc. If you are held to the lease or decide that you want to stay at the shop the its a case of evaluating your business and making some changes.

As already said - looking at increasing opening hours (maybe offering longer evenings/weekend hours where this is in demand), cutting costs, maybe changing suppliers/brands where you need to, negotiating costs/terms with current suppliers.

What do you currently offer? How much room do you have to sublet?
What is your competition and what are they doing?

Could you organise a relaunch/anniversary party or charity event to generate interest or get publicity? Would your local paper offer a free business editorial?

How does your shop look? Could it benefit from a lick of paint/deep clean etc etc

Are you able to forge reciprical links with wedding venues/suppliers/other local businesses?

Just a few ideas that may help. I hope this works out for you and understand how stressful this must be. :hug:

 

[jes]

It would be unusual for your solicitor not try and negotiate a 'break clause' (get out option) into the terms of your lease. Are you sure you don't have one?

 

[rachael204]

Just to update you all, I was very, very lucky and my landlord agreed to let me out of the lease early!! Took a great deal of negotiation, loads and loads of help from my dad, boyfriend and friends but its all over as of today!!

Its still been an absolute nightmare, but I am out, all set up ready to start working from home and its hopefully going to be great!!

Thank you all for your kind words and advice!

 

[~cHeRiSh~]

Aww well done in your negotiations and you must be so relieved to be able to start again from home. Good luck to your business for the future :hug:

 

[katiebbaby]

Seriously this is a lesson to be learned,, 10yr lease is an awfull long time to sign and an awful lot could happen in that time,,,as did, but usually a lease this long is not offered unless established already and lease has been renewed prev and a forcast can be seen, first 3 yrs of any new business usually 70% fail imagine signing 10yr lease and no business

xs

 

[rachael204]

You are so right!! I went into this not really considering the next ten years! My friend that sublet from me in the beginning was 23 and I was 31, it was almost a dead cert that one if not both of us would have a family in the next ten years!!
She beat me to it, but hopefully my turn soon!!

Its just such a relief to be free from it - emotionally and financially!!

thanks for the support guys :hug: