Hello and welcome to my first column as I share the challenges of developing my new store in Inkberrow, Worcestershire, for the next 12 months.
From an outside perspective, taking on a new store can seem like an exciting challenge, but with some big caveats attached. The government shouts that there are more entrepreneurs in Britain than ever before, yet in the world of convenience retailing it is almost harder than ever to maintain good profit levels in the face of the evolving retail landscape.
Growing your business by acquiring more sites does not equal automatic success. Acquiring more sites requires a lot of capital, increased overheads, good staff and, above all, excellent management. When the owner of a good business has to divide his or her time across different sites, then to provide a high level of standard consistently across all sites requires great interpersonal skills.
Acquiring more sites is also more difficult. In the current financial period where banks are more careful about lending, where the multiples and independents are after the same sites, and the increased demand causes higher prices, it is tough to find a good site at the right price. The convenience market is very much in demand.
If you're a business owner that is performing well from one site then before departing with all your hard-earned savings and expanding, you should ask yourself whether you could squeeze more out of your current business. Do you have the right systems and processes that will allow your current business to perform well and replicate that at a new site? Do you have a good team you can depend on to offer good service when you are not there? If you already run two sites, what has worked well and can you replicate those experiences and processes at a third site?
Finally, if you know somebody who has 10 sites and you have one, do not automatically think they're more successful. More sites means more overheads. More sales does not directly translate into more profit. However, if, like me, you feel that you have a formula that works, then why not push yourself and expand? I purchased my third site earlier this year and in my next column I'll explain the process I went through to find it.