If you are planning to open up a new store, you have a lot to consider. You need to work out a business plan, consider who your audience is and how you can reach out to them as effectively as possible, in addition to setting a practical budget based on your expected expenses. Here are some considerations to help you identify whether your store idea will work or not –
1. Do you have experience opening up similar stores or how long have you been in the industry?
Have you done this before or are you a novice? If you have some experience opening similar stores or have been in the industry for some time, then you will have a better idea of how your business will run – statistically improving your chance at success. As a beginner, you could also do well – so long as you do enough research about your industry and competition before giving it a go.
2. How many competitive options are within a 5 to 10-minute drive? Are you different?
Do you have any competitors within a short distance? If not, you could be in a better position to sell your product. But if yes, what makes you better than others? Is it quality? Is it service? Is it a product? Think of your difference and highlight it as much as possible in your marketing and materials.
3. How will your prices compare with the competition?
Take a look at your prices and see how they stack up to your competition. Are you more expensive because your products are of better quality? Can you offer a better deal than your competition to draw in customers? This is an important factor as price is a big consideration for prospective customers today. Will your business model still work, if your prices need to drop by 30%? Be realistic and be cautious.
4. Who will manage your store?
Will you manage the store on your own or do you intend to hire someone for the job? If you are hiring someone, you need to make sure they can handle the operation and are trustworthy. Be sure to check past experience and references so you don’t end up making a mistake.
5. What is your digital marketing plan?
The days of physical flyers and mail order brochures are long gone. With nearly everyone today researching the Internet first for products and services, you need to have a strong, well-organized and well thought out digital marketing plan – including paid advertising, search engine optimization, search engine marketing, social media marketing, analytics and more.
6. Do you have a great product and great service?
Not even the best marketing plan in the world will work if you have a poor-quality product and/or poor-service. In order to sell successfully in the long haul, you must back up strong marketing efforts with a great product and even better service – adding value to your customers.
7. Do you have a space lined up in a great location?
You also need to have a store in a great location so you can reach out more successfully to people likely to buy from you. The store should be easily visible and easy to access to draw in more customers.
8. Can you survive the initial launch period where it takes time to grow a customer base?
Not all businesses start booming from the beginning. There is often a ramp-up period that takes months to grow a customer base. You should have the capital to see through these months before you start to see some real results for your business. We had one business that started off slow, but grew sales by 1,186% in just 3.5 years later (yes, this really happened and yes you read the ONE THOUSAND ONE HUDRED AND EIGHTY SIX percent increase correct).
9. Have you done market research on the need for the area?
Have you done enough research to know what the area needs? If you’re able to find gaps in what people in the area are looking for and what they actually have, you should be able to deliver a product successfully in the market.
10. What is your business plan?
A good business plan is one that covers every aspect of your store – from expenses like rent, utilities, payroll, and product to goals and objectives to your target audience to potential demand and so much more. A more comprehensive business plan that includes opportunities and weaknesses will help you better plan for your market. The business plan should include everything from how you will launch to when you will launch (i.e. seasonality and timing matters), to how much it will cost you.
Use these guidelines to determine whether your store idea is good enough to work.