Having successfully created and profited from your own home business, it is not uncommon to start thinking about expansion.
However, with just under 40% of new store businesses closing within the first five years, it is important to have a business plan and foolproof strategy in place to make sure your store business is as successful as you hope it to be.
There are a lot of factors to contemplate, which could be overwhelming at first, but taking it step by step through each of these points will help to break down what seems like a monumental venture.
A budget plan for a big scale move is a sensible place to start. You will need to have a strong idea of how much this expansion is realistically going to cost you, and more importantly, how you are going to fund it.
It is crucial to include all of the factors listed below, and do a broken down, well-researched budget plan. Companies like https://nucleuscommercialfinance.com/, who specialise in business loans, can work with you to find the funding that will best suit you and your business.
It is important to secure funding before you start expanding, as it wouldn’t be wise to be working out of pocket if you do not have the appropriate savings in which to do so. It is also advisable to check your finance health before applying for any loan to check you are eligible.
It would be beneficial to start marketing for your upscale as soon as possible. Remember when drafting the marketing materials that you can use your business size to your advantage.
Marketing that you are a local and independent business can help to maximise interest and anticipation for your opening. Be sure to use buzz words like “unique”, “handmade/crafted”, and “locally sourced” to set you apart from the corporate chain stores around you that you may be competing with.
Tailoring your marketing to your given clientele is important, but do be inclusive of others as pigeonholing your business could be damaging.
The use of Social Media is imperative nowadays as it is the 21st-century version of word of mouth, and gives you the ability to reach more people in less time.
Many local areas have their own Facebook group to advertise and promote smaller businesses and local events. Holding a small giveaway competition that is won by sharing a particular post, for example, on groups such as these can increase your online presence dramatically and therefore your business presence.
Without effective marketing, the quality of your store and product is all but meaningless, as people won’t know you are there in first place. It is imperative to you and your business to not take this process lightly, and not skimp or rush on planning.
Are you looking for somewhere on the high street right in the midst of competitors, or somewhere a little less built up – and what effect will this decision potentially have on your business?
This is a case of balancing up the cost of the premises, and the likelihood of footfall. Be honest as to whether you are a business where you need to go to the customers or a business where the customers will come to you.
Typically if you are a store that offers a general service customers will tend to come across you, but a more specialised service, for example, a wedding dress tailor, will have customers seeking the establishment out.
If it’s the former, then a high traffic pedestrian area like a shopping centre or high street would serve you best despite the increased rental cost.
If it’s the latter, you can save money by either being in a business park/industrial area or sticking to the outskirts of town. Either way, make sure the location is going to serve your business needs best, do not just settle for the cheapest or stretch to the grandest.
Size And Interior
Depending on your product(s) you will need to consider the size of the establishment that will best suit you and your business needs.
Your budget may be a limiting factor here. However, you don’t want premises which could become overcrowded and difficult to navigate through.
On the other hand, you wouldn’t want a large warehouse if you have a limited number of products to sell. Envisioning a scale floor plan and product displays will help when viewing potential properties, and allow you to balance what you would ideally like and what is possible.
It will also be beneficial to look into the type of interior design that will compliment your product, i.e. if you are selling large pieces of furniture, a two-floor property with no lift may not be best.
On the same lines, you will need to imagine what interior decoration will compliment your branding, and whether transforming the space is in line with your budget.
Be mindful that finding the right space could push back your timeline considerably, you do not want to settle for something that is not ideal only to pay for your hastiness further down the line.
Avoid Rapid Recruitment
When moving to a store business, it is easy to focus on creating a strong in-store team. However, this could be less cost-effective in the long run. Furthermore, depending on the size of your desired store, this may not be the most feasible option.
Outsourcing is a great way of making sure you have reliable people focusing on the jobs that don’t necessarily need doing on site. This leaves your in-house team to focus on what is extremely important – exceptional customer service.
Website maintenance, upkeep of social media accounts, customer aftercare, and accounts are all services that can be managed off-site should your budget allow.
Outsourcing guarantees a specialised and reliable employee, rather than the responsibility of effective training being placed on you. Also, recruiting too many employees for in-store is also something you’d want to avoid.
Hiring a small team, and then expanding if you need to, is more reputable than hiring more people than you need and having to let employees go if the budget does not allow for them.
Timeline and Deadline
It is essential to know what kind of timeline you are working with. For example, setting up in a time like December would mean you have a quick turn around before the start of the new financial year.
Setting up for an opening in July would mean you are launching in Independent Retailer Month. Therefore, it is important to give thought to what time of year you want to open, thus giving you the timescale in which you are working with.
It is key to keep in mind that certain factors may push your deadline back, hence having contingency time is crucial if you are set on opening on a certain date.
Plan every aspect of your opening process and how long it should take, then add more time. Even a carefully planned and executed timeline will rarely run on schedule, so be realistic with your goals if you have a finite amount of time to work with.
It is better to plan something basic and do it well than to plan something extravagant only to have it fall short of expectations.
You will want to include funds to cover this event in your starting budget, as this will involve staff, marketing, and potentially an opening promotion to entice customers in.
This may also include the possibility of paid staff marketing the event locally – for example, leafleting the high street and nearby local areas, and displaying posters in accompanying stores.
Having the opportunity for customers to sign up to a mailing list while marketing the event, leaves the opportunity of sending reminders and increases the potential development of loyal customers.
Don’t Be Afraid To Team Up
If you are setting up in an area with lots of other local businesses – be a friend, not a foe. Unless they are a direct competitor, there is no reason why teaming up with other independents could not benefit all businesses involved.
Especially when you are standing on your feet in the commercial industry for the first time, it is good to network with others that have been in the industry a little longer and can help you to work out the kinks that every new business undoubtedly comes across.
Event evenings that offer discounts and promotions for all stores and market for all the local businesses in the area as your starting out can be a great way of building your loyal customer base up.
This is by no means an exhaustive list. However, it is the bare bones of a comprehensive strategy which you must flesh out with your product and branding to ensure continued growth and success in the coming years.
This is about starting right, to continue right and therefore creating a sustainable foundation for your business to lay.