Every business owners’ dream is to grow their business. Growth comes in many different forms; you may be experiencing new customers, more repeat customers, or increased revenue. One way to capitalize on this momentum and avoid stagnation is to expand into additional locations.
In this case, you have either reveled in the success of your first business or perhaps, seek to build upon your booming franchise. When doing so the location of your business is essential.
Irene Dickey, a lecturer at University of Dayton’s School of Business, said “In the brick-and-mortar retail world, it's said that the three most important decisions [you'll make] are location, location and location.”
Your customers are the lifeblood of your current location, meaning the potential customer base that make-ups your desired location is critical to its success. Here is what to look for:
It goes without saying that foot traffic and density of that location translates to the foot traffic you expect to see in your business. To get more granular in your forecasting, map the foot traffic for times of day in relation to your business hours. Is it a ghost town at night? Is there increased traffic during lunch times during the work day? Catherine Heany of CHARburger took note of the pattern of traffic before opening her second business. “I also knew before we opened that people tend to have very short lunch breaks here in downtown Fresno. And so I wanted to make it so they were spending less time waiting in line, more time ordering, more time sitting down enjoying their lunch, their break.“
Identify your current customers with advanced Customer Relationship Management tools to get a snapshot of the demographics and psychographics of your customer base. Then, do your market research to see if there are enough potential diners in your interested locations who mirror the demographics and psychographics of your current customer base.
Financial and Operational
Each location will have its own specific rates and expenses. While renting the building will eat up most of your costs, there are state and local taxes, insurance rates and minimum wage laws that you will need to comply with. Restaurant Owner outlines all the costs that goes into opening a restaurant.
Additionally, get a list of zoning laws and restrictions that may curb your traffic or offerings. If it affects your business to strongly, you may want to reconsider the locations.
Keep your friends close, and your enemies closer. While a bit theatrical, this can be aptly applied to business expansion. By setting up shop next to a larger competitor you can benefit from their efforts. Ride the coattails of your competitors bigger budget, business researcher, Greg Kahn, asks and answers, “Why spend the money when they've already [spent it] for you?" "It's that easy."
When choosing your next location, it is important to anticipate future growth and set contingencies in place to mitigate growing pains. Revel iPad POS System can take on a huge part of the workload with an iPad POS system designed to scale with your business, from single location to multi-location. Revel takes the guesswork out of inventory management, reporting, accounting, online and mobile ordering, staffing, loyalty programs, and a host of other business challenges. You’re going to face a huge amount of work getting your franchise operation up and running. Why not let Revel lend a hand with the heavy lifting?