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The UPS Store Small Business Blog
  • 30 November 2020
  • Kayla Meier

Considering a Brick and Mortar Location? Pros and Cons

As we near the end of 2020, we have an opportunity to look ahead to small business goals for the coming year. For many small business owners, one of these goals could be to open a brick and mortar location. There are many factors to consider before opening a physical store, especially during a pandemic, but with careful thought and planning, you can make the best decision for your business. Keep the following factors in mind when weighing the pros and cons of brick and mortar.

Customer Experience

Pros: Though many businesses have pivoted to digital sales this year, there are still many benefits to operating a brick and mortar store that can help endear shoppers to your small business.

  • Try before you buy — Some customers prefer to shop in-store so they can view and handle goods in person. For instance, they can try on clothes, swatch cosmetics or smell candles. This makes it easier for customers to
    customer with retail shopping bags
    find and purchase products that fit their unique needs and gives them the opportunity to uncover products they might not have considered before.
  • Instant gratification — Though many online services now allow for fast shipping, shopping at a physical location gives customers the ability to get what they need right away without the added cost of shipping. Plus, returning items to the store is often easier for customers and gives them more opportunities to continue shopping and spending in your store.
  • Immersive experience — If your small business started online, opening a brick and mortar location can help you build your brand and create a unique experience. Previously, many retailers designed their stores with spaces to lounge or even see live events. Now, retailers are focusing on personalized experiences tailored to the individual. This personal touch can help your business build relationships with the people in your community and encourage a loyal customer base.

Cons: While in-store experiences can help set your small business apart, there are some drawbacks in this area.

  • Tackling transportation — It is important to pick the right location for your store. In areas with inconvenient parking or limited access to mass transit, customers might choose to shop online rather than deal with the uncertainty of finding parking or the difficulty of carrying items home.
  • Crowded spaces — The design and layout of your small business’s space is more important than ever to ensure a sense of security and encourage product discovery. In this time of shifting regulations, customers may be wary of shopping in small, crowded spaces and interacting closely with associates or waiting in long lines for entry.
  • Comparison shopping — Though customers might visit a brick and mortar location to check out an item and learn more about it, they can easily research competitors’ prices online and might choose to order from a website instead.

Customer Reach

Pros: Though the retail landscape is in flux, opening a brick and mortar location can help you reach customers in new ways.

  • Court foot traffic — A storefront in a high foot-traffic area with an eye-catching display could help more people in the community discover your small business. A convenient location, highly trained associates and quality service can also help you attract regular customers.
  • Plan a partnership — With a physical space to display items or offer services, brick and mortar shops give small business owners the ability to partner and collaborate with others. Whether you set aside space on the shelves for a special brand or room for corresponding services like nail art in a beauty boutique, you can take the opportunity to grow your network and entice new customers. With the right partnership plan in place, you can troubleshoot for changing scenarios and make the most of your space.
  • Pop-up shop — Before you commit to a lease, you can test the waters with a pop-up shop. See what short-term spaces are available to test your retail concept, and build excitement with social media marketing. By staging a pop-up, you can gauge customer demand for your brick and mortar business and gain valuable insights into how to build and sustain a successful store.

Cons: Creating an exceptional experience for your customers takes time and money. In addition to the cost of maintaining your online presence and retaining professional services, you will need to account for a number of costs and expenses, including, but not limited to, those outlined below.

  • The space itself — To run a brick and mortar store, you will need enough capital to cover at least two years’ worth of rent. Additionally, you may need to account for renovations or interior design of the space, plus all of the fixtures and furniture needed to display your products and create an inviting atmosphere. On top of that, you will need a point-of-sale system, computers and internet, a security system, and other IT systems and services to keep your shop secure and running well.
  • Licensing and permitting fees and insurance — When you open a brick and mortar location, you will be responsible for a variety of licenses and permits that vary by business and state. Make sure to also protect your investment and your employees with business insurance, such as commercial property insurance and workers’ compensation insurance.
  • Advertising and marketing — To spread the word, you will need to develop an advertising and marketing strategy and even create signage and materials for in-store use. If you decide to go the brick and mortar route, the printing experts at The UPS Store can help you get the word out with everything from a grand opening banner to a set of business cards.

There are many pros and cons to consider when expanding your small business, but with thorough knowledge of your offering, customer preferences and location options, you can see if the time and circumstances are right to open a brick and mortar location.

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