To move or not to move

[pollyann]

We are in the process of buying an existing frame shop located in a small rural community of appx. 3000 people. The previous owner opened the shop about 2.5 years ago and did moderate sales. We have the option of keeping it in it's existing location, somewhat off the beaten path, or moving it to a new strip mall in a busier part of town about three miles away. The new location is almost triple the existing rent. Should we risk the higher rent payments and move the shop, or keep it where it is and concentrate more on advertising (which the previous owner did little of) We have both been in framing for approx. 18 years each.
Thanks for your advice!
PollyAnn and Jeff

[DTWDSM]

A small town of 3000, what is considered "moderate" sales? What is current rent?

With a limited population like that and with studies that have shown that only 10-15% of the population ever uses a custom framer, I really don't know if a location change will make as much as a difference as advertising does.

[pollyann]

The current rent is 500$ a month plus utilities, the new mall would be about 1300$ We have his records for the last 4 months of 2005, but he was ill and was not open on a regular basis so it's hard to estimate what he could have potentially done in sales. His records show that he was pricing his jobs extremely low, far below the industry average. His P&L's for last year show he broke even, but again we are not sure how accurate his records were. With this in mind we have decided to change the name of the shop and try to reopen as a new store offering custom framing, prints and gallery pieces. We will also work with local artists and feature their work as well.

[JohnR]

Pollyann,
Welcome to the Grumble!

It would be hard for anyone to give conclusive advice without lots of research of your area. $500 is a great price if the store is the size you need and in good shape. It ain't worth a darn if you're not getting people in it.

$1,300 is great price for a strip mall location. At least from where I’m at it is. As long as traffic can see your sign, I'd think you could easily outperform the current location.
John

[Roxanne Langley]

Pollyann:

Tim's right a small town of 3000 can actually only bring in a certain dollar amount of sales. Do you have any larger towns close by that would travel for great custom framing and local art? If so you'll need to allocate advertising funds for that sector.

If you stay in the current location (by all means change the name, you never know what type of baggage you may have to deal with) you'll end up spending the extra funds on advertising that you would spend on the mall location. If you have a chamber of commerce, get with them, have them help you with the demographics of the area and look at where the prior client base was coming from. The mall location can give you instant ease on directions for folks, higher visibility, good parking, etc. Not to say you won't still have to have advertising dollars, but make your life a bit easier in the beginning.

As to working with local artist and featuring their work. This is an area that I pursued last year and many people told me that they weren't sure it would work all that well. A year later I have 27 local artist and hold a very successful monthly open house for them. If you'd like I can give you alot more info about this just e-mail me and I'll be more than happy to answer any of your questions. It can be very lucrative and help ease some of the financial burdens.

Roxanne Langley
Langley House Gallery

[Jerry Ervin]

I have learned over the years that renting a location is just like anything else in the world. You get what you pay for.

The rent would be a little more than double, but I bet you could double your sales numbers.

I have been in poor locations before and no matter how much I spent on advertising, it never returned what was spent.

I firmly believe that you can not out advertise a bad location.

Welcome to the Grumble.

[Canton Crew]

Location, location, location. It's a cliché, but a very important one. Ask yourself this: What happens if you stay in the old location, and a year or two down the road somebody opens a frame shop in the strip location? Can you then compete? I'm not saying move, but think hard and plan it a couple of ways. Also, why buy if all you have to do is lease the shop in the strip mall, buy some equipment, and start from scratch? If this fellow was operating sporadically, perhaps his "goodwill" is not worth much, and you already have questions about the location. If he was under-pricing, your base may walk when you try to charge a "living" price for your work. What, exactly, are you buying?

[pollyann]

Thanks for the responses everyone,

Our biggest concern, as I am sure it is with everyone, is making a profit. The previous owner's P & L's showed he broke even but was not taking home a salary. Financially that is not possible for us. I currently manage a frame shop in one of the BIG BOXES and my husband runs a private frame shop. I would be quitting my job in order to run the new shop and Jeff would remain at his job. The nearest town is Green Bay and is saturated with frame shops. I do believe that we both have been in the business long enough to bring some of our clients with us, but the majority will not drive 20 miles out of town to Pulaski. The previous owners clients were 90% from Pulaski with appx. 10% from the surrounding rural towns, Gillett, Oconto Falls and Shawano. Pulaski has struggled for years to revitalize the old downtown area, where the shop is located now. The new strip mall is the first sign of anything new happening in this town. When I talked to the developer of the mall he said he has had so many inquiries that he is going to raise the price per sq. ft. to anyone new coming in. I do feel that if there is that much activity and interest in the mall that it won't be long before they build more or before the downtown area finally becomes a point of interest. Green Bay is bursting at the seams and people are moving out of town, Pulaski is one of the fastest growing towns in the area. I guess we are leaning twords staying in the downtown area but moving across the street to double our space (same rent) and increase advertising, work with the local schools (offer to show art students work) and bring in local artists and see how the area responds. If the new strip mall is that much of a success I am sure there will be more to follow and we could move to a location with higher rent when we are in a better financial position to take the risk. Any thoughts?

Thanks, Pauline

[Elaine]

I would suggest moving and changing the name (let the current customer list know with a direct mailing). I opened a shop next door to where another shop had closed. People assumed that I did business as she did and ran my business as she did. I inherited a lot of bad baggage just by location association.

My demographics are on the low side - approx. 7,000, only 2,800 homeowners, but in a more affluent area compared to the neighboring towns. I draw customers from within a half hour drive based on reputation. I moved my location a year ago, and have a noticible increase in local business just because of location and signage. Visability has been a plus. My rent increase was double, but I think it was worth it.

my 2 cents, but you have to do what works for you and your area.

Elaine

[pollyann]

Hi Canton,

Here's how it all started, about 3 years ago I was going to open a frame shop in Downtown Pulaski, I was working with a guy who was willing to give me the store front for free until I turned a profit and could in return pay him rent. He said having a business in there was better than having it sit empty (and it was empty for over a year) within a month after, to our suprise, a frame shop opened across the street. There was no way I could open a second frame shop in such a small town so I put the idea to rest and continued to manage the frameshop in Green Bay. 3 years later, and I am now married to a framer, the guy who owned the frame shop passed away and his brother contacted me to see if I was interested in buying the business. This happened in January, after 2 months of negotiating and getting the price down, basically to a point where we are just buying the equipment and inventory, we find out a new strip mall is building in town. We had all intentions of staying downtown, as there were no alternative options at the time. Just this week we were able to get access to his last 4 months of reciepts and we find out he was charging way below the average, there for we have decided to change the name and change the image from just framing to a gallery and frame shop and draw new interst. Realisticly I am not sure the strip mall will generate that much more business for a service based industry. Based on the figures that my husbands shop does, after being open 5 years in a brand new strip mall with traffic that would blow this town away, we would have to do the same business he does in this small town to break even. I think the risks may be to high.

Pauline

[pollyann]

I did forget to mention the rent at the location now is month to month and if we move across the street and double our size it will be on a month to month as well. The new strip mall 3 miles away requires a 5 year lease. The community is very small and I have heard nothing but good about the previous owner (perhaps because he was selling his services so low) I do know that there is alot of loyalty in this small town to help out fellow businesses in the downtown area.

Pauline

[JohnR]

I'd go for the strip. Like the other Grumblers have said in a round about way, a framing business storefront needs exposure.

Also, don't forget to invest in a nice lighted sign that includes "Picture Framing" on it.

I have a framer friend who moved from one strip to another. The first strip was a bit nicer, but with weaker exposure. The second strip was an older place and right up to the road. His sales increased dramatically yet he pays less in rent.

John

[RozR]

Location. Location. Location.

I am just curious as to what is part and parcel of the purchase of this frame shop that you are in the process of buying. And to buy it then move, why not just open your own from scratch with the experience you both possess?

Just a thought...

Roz

[pollyann]

Our first reason to buy it was to prevent anyone else from opening it as it was. The previous owners brother is selling it to close his brother's estate. He is selling it as is, everything inside the 4 walls would be ours. Equipment, inventory, worktables, computer ect ect. The price is right (I doubt we could buy everything new for what he is asking). I also know from experience that there are to many people out there with nothing to do with there time and will buy it because it's cheap and it sounds like a "FUN JOB" I worked in a private gallery for a while that was just the case. She was bored so her husband bought her the business, it had been around for years and the name spoke for itself, unfortunately she knew very little about the framing and I was hired after she took over. I saw her dry mount signed and numbered prints, stapled x-stitch to cardboard and the list goes on, while the customers had no idea waht was being done. I love what I do and the thought of someone else in this small of town opening a frame shop would be the final straw! Guess I would have to move then!!

Pauline

[trapper]

Hard decision to be faced with..
Based upon what I am hearing you say, I would stay small, and not move at all..least for now.
Probably not the popular opinion, but I think it would be the safest at the moment. Give it awhile and see how it goes. Right now you say it is breaking even without having done lot of work. I am gethering from this that with a little more effort on your part you will make a profit. Save the profit or live on it..! Be nice if you could figure out a way to save the profit and not spend it on anything but the business for awhile. In other words put every dime back into the business.
Build it up.
Location might be everything, but around here it doesn't mean that much. It is often the business owners that make the location. Many poeple will go way out of their way to see a particular place. Pass right on by several. You can be right in the thick of it all, but if you have a bad rep or a dirty looking place or are just too spendy people will drive right on by or not shop at all. I can think of several places within a ten mile drive. Only place in town, but I for one will not even slow down to pull in..Instead I drive another 10 miles across the other side of town and pay more..!
What does this new place offer you? Take all that into account. How much more floor space? Separate rooms? Better lighting, more wall space..Etc.
Consider all these issues then make a final decision. Take your time and don't be is a rush.
Put it all down on paper. A list of all the pro's and cons..Talk it over with each other. Beat them to death if you have to. Obviously the more time you spend on any one item the more significant it will be to you. Be surprised at what seems to jump off the paper at you. Has a lot more importance than you thought..Especially now that its down on paper. For Diane Lighting as in Natural was of extreme importance. For me it was having space available downstairs and it had to be finished..not a dirt floor basement.
Heated..lit,,carpeted and walled off..Location and rent came next.Location was only important to me if it had a place to work comfortably and cleanly in. Fortunaltely all worked out for me to the plus side.

The final choice will always be your of course..Move or not to move..Like I said in the beginning tough choice.