5 Reasons Why You Should NOT have a Store Front

Posted by 19 March, 2009

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Opening a business is tough. A lot of great companies have started when the economy is down such as GE, Google, Microsoft, and Allstate. Whether times are tough or the economy is going strong, when it comes to a business, you’re only going to stay open as long as your sales exceed your expenses unless you happen to have a pile of cash to burn through. If the latter is the case, please e-mail me and I can help with that :).

Personal Story

My wife and I spoke having a store front the other day. She is interested in becoming a baker specializing in cakes and cupcakes. I hadn’t posted anything about her blog before, but you are welcome to take a look at it. If you take a look at her blog, you can see that she’s gotten pretty darn good at the art of baking and decorating cakes and cupcakes. If we were to make a pro/com list, there would surely be a good list for both, but this article will be focusing on the con portion of the list.

5 Reasons Why You Should NOT have a Store Front

1. Store Fronts are Expensive – This is a no-brainer, and the main reason why I don’t want a store front. Before you make any profit for the month, you have to make, in most cases, at least $1000 (I’m guessing on the rent) and up to $1000’s of dollars a month for nicer locations. This seems backwards to me. It seems silly that people should have to work really hard just to break even, not to mention how hard you have to work to make a few bucks on top of that. When I think of store fronts, I can’t help but think about being a sharecropper and that’s is not a positive image for me.

2. Vacations are gone – My dad had 3 different stores during his tenure as a business man. I always had a lot of fun in the last two stores (I was not born for the first store). The second store sold comics, costumes, and magic tricks. The third store sold sports cards, comics, magic the gathering cards, and Pokemon cards. Both stores were really cool as a little kid and teenager. If there was something I really wanted in there, I could talk to him about a way to work for that item. Looking back on my childhood though, there was one thing missing from our vacations: my father.

3. Time Away from Family – When you are getting a business off the ground, lots of time will be spent on the business. Most people value time with their family. If the business is located away from the home, this is more time spent away from your family. If you are able to keep your business at home, this inherently gives you more time with your family, although probably not much in terms of quality time. However, having the business at home may also allow you to avoid daycare partially or all together.

4. Less Flexibility – Here’s the deal. You have a store and it must be occupied by either yourself or an employee at all times. In the case of a bakery, hours during the week are typical and on Saturday at a minimum is required for potential customers. In addition to less flexibility in terms of time, there is also a lack of flexibility in terms of businesses’ finances. A lot of people are feeling the pain of America’s current financial state. If you have a store, and business goes down, that could certainly put your finances in a crunch. If you worked from home, you have less expenses overall and are more flexible if there is a dip in your business.

5. Added Expense – Rent is not the only cost associated with renting a space. In addition to the utilities such as electricity, cable, gas, there is also the expense of making the space as you see fit. Your landlord is more than likely not going to turn the space into what you desire. For example, my wife is interested in opening a bakery. If we were lucky enough to find a store front with a kitchen included, I think we should consider ourselves lucky. If we find a store front with a kitchen, we will need to make the kitchen to fit to the needs of a bakery. Some additional costs could be if there are repairs needed for the rented space and the cost of any potential employees.

I understand that some businesses have more of a need for a store front than others. For instance, a fast food place might rely on foot traffic for a lot of it’s revenue plus hunger is a pretty urgent need, but an online book retailer might be able to get away with not having a store front (i.e. Amazon).

What do you think about having a store front for your business?

Photo by: Any Jazz65

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Comments
March 19, 2009

My side business are consulting and blogging, so I don’t need a store-front. I would prefer to always never have a publicly known location, just word of mouth and referrals for the business. If either blogging or consulting starts to make enough for me to leave my full-time job, I’ll set up an office near home.

I will never get into a business that robs me of my time with my family though. Not worth it.

Does you wife send out cake samples? I love a good cake!

Posted by the weakonomist
March 19, 2009

Hi Dustin,

First of all, l LOVE the name of your wife’s blog – Chic Cakery. It’s a brilliant name! I completely agree that having a store front has a lot going against it. Lots of small businesses operate from home until they have enough cashflow to go ‘public’.

Daphne @ Joyful Days’s last blog post..How To Find Happiness in 5 Minutes

March 19, 2009

I agree 100%. It doesn’t make much sense to have a storefront (or even a physical store) that can only serve thousands of people. It seems much easier and faster to serve the billions of people on the internet.

B7’s last blog post..Why Most Financial Advice Is Useless

Posted by B7
March 20, 2009

I can’t speak from experience, but perhaps the vacations issue was a question of delegation and management practices, rather than inherent to having an offline retail store?

Besides that, interesting insights into a world I don’t know much about!

Gab Goldenberg’s last blog post..WP SEO Plugin Conflict Report

Posted by Gab Goldenberg
March 23, 2009

@ Weakonomist – Thanks for the comment. I agree. your business is one that certainly doesn’t warrant a store front, initially. Yes, cake does sound good. We try to give away any cake she makes as soon as possible so we aren’t eating it :).

@ Daphne – Thanks for the comment. We are working with Texas legislators so hopefully she’ll have the option of working from home. Currently, it is illegal to sell baked goods from home in Texas.

@ B7 – Great point. Why limit your exposure to your surrounding area?

@ Gab – I agree. There was certainly a lack of management. My father tried to have a few different employees in there, but he often got complaints about the employees. Again, this could also be due to lack of management.
Thanks for the comment!

Dustin’s last blog post..5 Reasons Why You Should NOT have a Store Front

Posted by Dustin
March 24, 2009

Hi Dustin,
I had a shop for several years and really enjoyed it but it is a lot of work and it takes at least 2 years before you are making money to pay yourself.

I now have online shops and I’m trying them out. Waiting to see how they go but I agree with a lot of what you said. If I had a lot of money and could do a shop as a hobby I would probably do it again:)

Mem

Mem’s last blog post..THIS WEEKS FEATURED ARTIST~DEBBIE HANN

Posted by Mem
March 25, 2009

What a great post – excellent points about why having a brick and mortar really is the “old school way” of starting a business.

I teach clients about starting an online business and have a firm conviction that ONLINE is the BEST WAY TO START! Grow in to the brick and mortar if that’s your long term goal – however, read this article first and RECONSIDER the store front!

One of the things that bugs me most about traditional businesses, especially wholesale suppliers, is that they require many new start ups to have a “Store Front” before they’ll even work with them. Hopefully this will end sooner than later when they realize they’re LOSING MONEY by not working with the peeps that know how to cut costs and grow their bottom line!

Thanks again for the great post!

Nate Moller’s last blog post..Is Shaquille O’Neal Your Friend on Twitter

Posted by Nate Moller
March 25, 2009

I love this post! I think it is similar to renting office space when you sell professional services. If you manage well out of your home, then perhaps that’s the place to stay. But you never know the foot traffic and the visibility you might be missing out on if you don’t get a store front.

Miranda’s last blog post..Reader Question: Why Aren’t Banks Lending?

Posted by Miranda
March 25, 2009

Thanks for sharing your wife’s blog, I found it really interesting to visit!

Oh, and absolutely on the storefront thing. My father owns a brick & mortar service business, and it’s tough for him to take a vacation.

Nathalie Lussier’s last blog post..The Hidden Costs of Cloud Shoveling

Posted by Nathalie Lussier
March 25, 2009

This is an awesome article packed full of really good and useful insights.

Posted by The Quail
March 25, 2009

Dustin! Heya, you are right about store fronts being a necessity to cater towards industries that serves urgent needs. Food and medical services are two important ones in this case.

The one regarding vacation is rather subjective. My mom runs a home business, where the products are kept in a room. When the need to serve walk in customers arise, let’s not talk about having a vacation for the day. 🙂

Daniel Richard’s last blog post..How To Be A Financial Failure

Posted by Daniel Richard
March 29, 2009

Hello, your blog gave me a idea for a blog. I’m thinking about creating a top list of pros/cons of becoming a long distance trucker. I think 27 years should be long enough to offer a perspective. Thanks for the idea. Good luck with the bakery idea, let me know if you get it going, I have a healthy offering for you that taste great with cupcakes and baking period. And would be a awesome income addition if you decide on a store front, the bottle sitting on a shelf sells itself.

Posted by Stephen Fryer
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