What things should you consider before deciding to open a second store location?
In extension to the statements above, it is very important that the business owner/strategist has a process to measure the success or failure that is accomplished.
A gut feeling is simply not good enough.
Most accounting software has basic methods to assist.
Quickbooks has a Class / Location
Xero has tracking categories
Myob has locations/jobs
Using a client's example:
A beautician has three clinics with 20 packages of services and skincare products
Using Quickbooks as an example she creates three store locations
Then the 20 packages are tracked using "class"
She also mapped all her product sales against the appropriate clinic locations.
After three months the beauty salon owner discovered some surprising insights:
Ipswich sold mostly massage/waxing packages and in skincare, acne packages were the most popular
Moorooka did not break even in services or products, it was hemorrhaging losses.
Chermside clients loved the higher end packages and skincare products.
With this information, the beautician closed the Moorooka clinic, as the lease was due to be renewed.
A new product line of aromatherapy essential oils and massage goods were introduced to Ipswich.
The money she saved in rent by closing Moorooka went into more modern laser machinery and expanded the store in Chermside.
Knowledge is power.
Research, customer feedback, advertising/marketing, website SEO, blogging all work together well as long as you have processes in place to document their success or failure.
Can your business run on autopilot whilst you're away or will it stop running if you're not there?
To me it all starts with an effective strategic plan. Then you have a guideline to follow, if it's in place and working well, you know the things you expect from yourself and others will be in alignment with that. By the time you aim to go away... you know that the strategic plan has proven itself and your people are simply going through exceptional motions to do what they do, if there's a hiccup then it will show up fast and it will be solved. Here's an example.
You are away and an issue comes up witha key supplier, they are contracted to supply an item vital to production, they know you are away, and one of their team let things slide to give them some slack so rush out product for a new client. Your team doesn't know that but they know what to do. They call and chat about the issue, working on your key value of respect, everyone know the organsiations stance on that and follows it, it includes all stakeholders. Before long someone higher up in the organisation spots your team has an issue and knows that they need to take positive action. Hiccup attended to, and pursued until a resolution is achieved. Tey may be able to suply more often but in smaller amounts so you can keep going.
Anyything that happens along the way will be readily dealt with due to the team knowing they need to find effective and elegant answers asap. They have an intimate appreciation of the way things are done and how they can be solved.
Best overall example I saw was a guy and his wife who ran a business, he wanted more time, so he weaned himself off the business a half day at a time, to the staff it looked like he was out chatting with clients. Nope he was having some very well earned ME time. His wife took different times off. After a while they both took off a half week here and there and built up.
Along teh way he and his wife figured out the issues they could deal with from afar and plugged up the holes for any other issues that would come up operationally.
Each business will have differeing needs for what they need to develop for smooth systems, policies and procedures.
Have a client that has a product that is being used by major metropolitan cities (B2B) and wants to break into the Asian markets. The competition is fairly stiff with everyday household brands you...
Ask A.S.P.A - Australia South Pacific ASEAN Chamber of Commerce for some advice.
Are drone services practical and useful for your small business? What are the roadblocks and issues that can arise?
From a delivery point of view, using drone for delivery will provide better security so that you don't have to be home to receive the delivery. Currently you need to be at home or office to sign for delivery of parcels because leaving parcels in front of the house or unit is not safe as it can get taken or stolen by other people but if drone is delivering the parcel, the drone operator can leave the parcel in a more secure location such as the backyard of the house, or in the balcony in a case of apartment. This would save time for everyone involved in the process of delivery. No driving to post office or depot for the receiver and no repeat delivery for the courier.
I would like to know how I can try and build my business up a bit more to bring in my work & more income. But I must realise that at the end of the day, I am only one person & I still I...
When you start a domestic cleaning business, it's likely you'll do much of the cleaning work yourself, with the opportunity to hire experienced and skilled cleaners and take a step-back later on. Having the state-fo art cleaning equipment is the best way for you to gather some new, repeat customers. You can always count on your friends aand relatives to suggest your cleaning to business to their colleagues at work, and, suddenly, you have a lot more jobs to do.
I've read that some businesses actually lose money due to heavy discounts and people don't come back. Have you had any positive experience? Or bad experience? Does it help a small new business?
As both Greg and Jef mentioned, you need a plan in place before you talk to soeone from these companies. They are "hard sell" sales people and will pressure you into a deal you're not happy with. "If you sign up today, I'll give you an extra 5% of the commission" type thing.
The only way to make this work for you is to offer a service that requires minimal manpower to provide. Offering a massage for $30 is not going to help - your staff will get angry as will your other clients when they can't get a spot because you are full. Now, an infra sauna on the other hand requires minimal manpower to prep/clean and would still give a reasonable profit margin (assuming you already had the asset).
Offer something that requires them to buy something or return. Using the massage example again, You voucher could be for $50 massage with a voucher redeemable for a second massage at $50. This way your margin is higher and you are enticing them for a second visit, where YOU get all the revenue, not the group buying site.
Be aware, depending on which company is used, the % revenue they take can be from 30% to 70%, giving you the raw end of the deal.
My last piece of advice is set a limit to the number of vouchers sold and stick to it. Do not let them talk you out of it. There is noting worse than waking up and finding you have sold 3,000 vouchers, in a service based business, knowing you can not fulfil them before the expiry date. Asking for the deal to be stopped early will fall on deaf ears.
I've seen many businesses close after trying to provide these deals, but I have seen a few run very smart campaigns. As long as you know what your usual cost per acquisition is and stick to that, you should be fine.
We have a lot of successful entrepreneurs in our community, while some members are just starting out. Can you share the biggest mistake you did when trying to grow your business? What did you do to...
The biggest mistake I made and many others have made as well, is growing too quick.
My favorite, oldest and most successful client, has grown his business continually for 12 years now and he's turning over something like $ 30 million now, but he grows slowly and steadily... he has 8 stores now, and in a few years he will have 12 or so, but he never opens a new store until the last one makes profit and unless the criteria he uses to assess a new opportunity are all perfectly alligned. He's walked away from many opportunities, simply because he wasn't confident enough they would work... many people have told him he should grow faster... but he won't and he makes more money than he knows what to do with and his staff love him and his customers love him and he loves his life....
Biggest mistake I made is to grow before I was ready
As your business grows, would catering to buyers' remorse with incentives be scalable?
I'm not exactly sure what you mean, however, I don't believe that "no buyer's remorse" even exists. But many companies please their customers, so why would I say this?
I'm sure there are more reasons that could be added to this list, however, I feel like the 10 reasons above cover the majority of cases.
You and your business can do things to minimize the above cases, but you can't completely eliminate the issue because the outcomes are based on a complex blend of customer expectations, personal baggage (issues) and human nature (psychology).
You set yourself else up for success by presenting customers with detailed, accurate and transparent information about your product and services prior to the purchase. You also help yourself by guiding the customer to the product and services best suited for their needs. Also by reinforcing the value they are getting for the price helps eliminate the feeling that they aren't getting a good (or the best deal). You can also do yourself a favor by having a clear return/exchange/refund policy, a detailed knowledge base or FAQ section and helpful and timely customer service.
The rest is really out of your control, but that's okay. Only focus on the aspects you can positively change.
My turnover isn't paying bills.
Having owned and operated a restaurant myself I can certainly identify with your problem.
The previous replies are good ones and should be looked into, the biggest challenge in providing any feedback though is the lack of detailed information.
This is the first point I always request of clients. Get armed with as much detail (information) as possible, when you have this then you can make informed decisions and choices.
I suspect your initial problem is not having enough information to ask for help that is more defined than simply 'how do I increase turnover'. Baseline data is the key!
Information for you, right now, is to quantify, do this by making everything measurable.
How many days are you trading? Breakfast, lunch dinner? What is the average spend for each service time?
What are you food costs? Wage costs? Rent as a % to turnover, you make the comment that there is nothing you can do about the rent, I would respectfully suggest this can only be answered accurately when the question is actually asked.
What is the value of the 5% monthly increase you are looking for? Is it simply more customers X the average spend? If so this will mean a different course of action as opposed to perhaps investigating starting a breakfast or lunch service.
You have hit a wall after 7 months, does this mean that you were achieving your 5% increase prior? If so have you stopped doing something, can you do more of what was working?
I agree that simply reducing staff levels to the point that it affects service is pointless, no or bad service = no customers. Is your staff mix and rostering balanced?
It may seem I have compounded the problem by asking questions rather than offering solutions but if you haven't gone through an exercise like this, then any answer is more akin to throwing a dart blindfolded. You might hit the target, you might not. The biggest problem is that you won't know either way!
I wish you all the best in whatever course of action you take and I acknowledge your courage in putting it out there for help...always a big first step to overcoming a problem.
In achieving such rapid growth, creating a working strategy and business plan is most difficult work to do. Your complete business growth is depends on your strategy, marketing work, quality of your products, your team work. If you want such rapid growth in your business, you must need to take these all together.