If you’re debating whether to take your online business offline and create a brick-and-mortar shop, it’s crucial that you consider the advantages and disadvantages first. Here are some key points to keep in mind.
Pro: You Get More Space and Visibility
By starting a physical storefront, you make your business more visible to potential customers. If high-traffic areas are available to you, take advantage of them! Otherwise, having any physical presence makes your company seem more professional and dependable.
A physical storefront can also help with promoting events and stocking up on inventory. If you host in-store events, such as signings or product launches, your customers will appreciate the opportunity for a unique experience that they can’t have simply by shopping online. And, if you need to store a lot of inventory, having a physical space will make the process much simpler.
Con: You Have to Pay a Lot
In order to have a physical storefront, you will need to build some things first. The most important thing you’ll need is a space to house your store. This can be an existing building that you retrofit, or you can construct a new building specifically for your business. You’ll also need to install shelving, racks, and cabinets to store your inventory. If you have a large enough space, you may be able to put in a small warehouse section to store extra stock.
And, finally, you’ll need to build or purchase the necessary equipment to run your store. This includes cash registers, computers, and credit card machines. You’ll also need signage and displays to market your products.
All of these things will come with a price tag. The cost of constructing or renting a physical space can be high, especially in high-traffic areas. The cost of outfitting the space with the necessary equipment and signage can also be expensive. And don’t forget about the ongoing costs of maintaining a physical storefront, such as utilities and employee salaries.
On average, it will cost around $50,000 to $100,000 to start up a physical storefront. This amount will vary depending on the size and location of your business. For a more accurate estimate, you should consult a commercial construction contractor.
Not to mention, you’ll need to factor in overhead costs. With a physical storefront, your overhead costs will be higher than if you stuck with an online business model. You’re also responsible for maintaining the space like utilities and other bills as well as staff salaries. You also have to keep your shop and staff safe, so you’ll need to invest in security staff and equipment. You will also need to pay for different types of insurance. You may already be paying for insurance for your stock or other aspects of the business, so you’ll have to figure out with your insurance provider about whether your current package covers your next move.
Pro: You Have Better Engagement with Customers
By having a physical store, you are creating an experience for your customers that strengthens the relationship between customer and business. When they come into your store, they can see, touch, and feel what it is you’re offering. This type of engagement builds trust and respect—something that’s challenging to do when speaking to someone only through a computer screen.
If you can maintain your customers entertained and interested in your store, you’re more likely to close a deal with them. This could potentially lead to even more sales! There are multiple ways to achieve this task, such as displaying various products, giving away free samples of items or services, or hosting events in-store. If you make shopping fun and engaging for everyone who walks into your establishment, they’ll be likelier to spend money with you rather than the competition.
Con: You Have More Competition
A disadvantage of starting a physical store is that you will probably have more competitors than if you only sold online. Nowadays, there are many prosperous businesses that function both on and offline. Therefore, if you’re considering opening a brick-and-mortar business, be aware that big names in the industry may stand in your way.
There are many upsides and downsides to having a physical store over just an online one, but there more advantages than disadvantages. Some of the pros to having a physical storefront include being able to talk with customers face-to-face, seal deals easier, and make more sales. The cons would be that you have less control over your store, such as if it’s in a city with high rent prices or foot traffic isn’t great. Overall, starting up a physical store can net you more potential customers which could lead to higher profits.