Annette Watkins had major abdominal surgery
on Sept. 11, 2001. In the next three months, she had two knee
surgeries, the second one in the middle of the crucial Christmas
season.
But she didn't worry that her collectible
doll shop, Annette & Friends in Westminster, would
fail.
Her customers volunteered to help at the store
just so she wouldn't go out of business, like so many other
doll shops across the nation had since 2000.
Watkins has a special affinity with her customers
because she's a collector, too. She has managed to build a
successful business without losing touch of the hobbyist's
passion that motivates her customers. That bond saved the
shop during a difficult economic and personal time.
Sales of collectible dolls have been flat
for three years, partly because of the economy and partly
for lack of a sizzling new product, according to Maria Weiskott,
editor of Playthings magazine. Manufacturers including Effanbee
and Knickerbocker went bankrupt, and others cut back
their product lines.
| FAST
TRACK |
Turning
a hobby into a business:
• Structure the entity like a business with proper record
keeping, financial software, separate business bank account,
etc.
• Write a business plan to lay out what work your business
will do and how it will make money.
• Plan to be profitable. If you don't make a profit in
three of the first five years, the IRS will be skeptical
about your intent to do more than write off hobby costs.
• File for business documents such as a city business
license and county fictitious business name, and obtain
an IRS taxpayer number if you have employees.
• Keep important records such as lease and telephone bills
separate from household bills.
• Obtain business cards and stationery.
• If you have employees, pay all payroll taxes. Failure
to do so is the swiftest way to be put out of business
by the government.
• If you use outside contractors instead of employees,
be sure to structure the relationship to avoid penalties
by the state Employment Development Department. |
Watkins had seen the troubling signs in 2000
when some of her customers who worked in dot-com companies
started canceling orders. She laid off her two employees to
have more cash for inventory.
So the surgeries could have been the last
straw.
"I have the most wonderful customers," Watkins
says. They don't come in here for 15 minutes. They spend hours
looking around and playing with the dolls."
She encourages that play.
Annette & Friends isn't a toy store. Some
of the dolls cost hundreds of dollars. Yet Watkins and her
customers, mostly adults age 35 to 80, like to dress and pose
the dolls, group them and rearrange them around the store.
"You can't buy a doll that doesn't bond with
you," she says in all seriousness. "In a lot of stores, the
dolls are locked up. You can't really see them, touch them,
see if the fabric is top quality. They follow you around like
you're going to steal something. I don't do that."
Annette & Friends started as a home-based
mail-order business in 1994 shortly after the birth of Watkins'
son.
She had been a paralegal and had sold Tupperware.
"I hadn't worked for anyone else for years,
so I thought what kind of business can I start that will allow
me to spend time with my daughter, 10, and infant son," she
says. "I had always collected dolls, so I thought that would
be easy."
She ran a few ads in doll magazines, and her
phone started ringing. When East Coast customers started calling
at 3 a.m., Watkins decided it was time to open a retail shop.
She found an empty shop in a small strip center
on Springdale Street. Someone gave her a vintage cash register
that she calls a glorified cash box. She bought shelves from
a closed Thrifty store in Long Beach and the locked
display cases from the old Buffum's department store
in Long Beach.
Working alone seven days a week, Watkins made
$25,000 her first month. Now the shop is open five days a
week.
Doll collecting is an obsession, she explains.
Some of her customers go on a binge to buy a specific doll
and every matching outfit and accessory, and then sell it
all off so they can buy another doll line.
The locked case displays one-of-a-kind dolls,
some of them prototypes from Watkins' personal collection.
Sometimes a customer will linger around a special high-ticket
doll for months. Watkins notices and tries to find a way to
make that purchase possible.
"The satisfaction I get from the joy I bring
to someone else is worth more than money," she says.
The best part of her business is interacting
with customers. About five times a year she brings doll and
clothing artists to her shop for her customers. Once a year,
she hosts a tea that brings customers from all over the United
States and Europe.
She won't even take orders on her extensive
Web site, www.af doll.com.
"I love customers. If I did all Internet,
what would be the point?" she asks. "Half the fun is talking
to customers. Some of mine have been with me since day one."
Business is getting hectic again. Through
June, Watkins had sold as much as she had in all of 2002.
She attributes the increased business to the fact that so
many former competitors are no longer in business.
She's not hiring yet, however. "I can't afford
employees because of workers' comp insurance," she says.
But she's not complaining. "I go to sleep
each night looking forward to coming to work the next day.
How many people can say that?"
