With the changing nature of retail, brick-and-mortar stores are evolving into different types, each with its strengths and weaknesses. There are now three leading brick-and-mortar stores: the flagship, the urban, and the neighborhood. While the flagship is the ultimate retail experience, the urban store is designed with ease of purchase and convenience. Neighborhood stores are limited in selection and are often drop-in hubs for purchases made online.
The Advantages of Brick-and-Mortar Stores
The benefits of brick-and-mortar stores go beyond the transactional aspect. Stores serve as showrooms for online products, pickup locations for omnichannel orders, and distribution points. On the other hand, the online platform is practical for marketing tools, building brand awareness, and for customer relationships. For promo codes and coupons, click here. The benefits of brick-and-mortar stores are best measured in the lifetime value of a customer. It is important to note that financial leaders are primarily motivated by the help of brick-and-mortar stores.
This advantage may be overshadowed by e-commerce’s free shipping and return policies, but brick-and-mortar stores offer more flexibility. Brick-and-mortar stores also have more employees, enabling them to perform various business functions.
Brick-and-mortar stores are a proven retail strategy. They are a proven way to boost sales. Brick-and-mortar stores are projected to outsell eCommerce by nearly four to one by 2021. Furthermore, customers can interact with products in person and try them on in fitting rooms. Moreover, sales assistants can guide them through the entire process, from greeting customers to checking stock availability.
The Disadvantages of Brick-and-Mortar Stores
Regardless of the size of your business, there are disadvantages to operating brick-and-mortar stores. While traditional brick-and-mortar online sales still far exceed many customers browse online stores before making a purchase. According to the U.S. Department of Commerce, 14.3% of all retail sales were made online in 2018. That number is growing yearly, and more consumers are making purchases online.
A physical store has higher operating costs, including space, shopfitting, and security personnel. Additionally, physical stores may be inconvenient to visit. Customers may drive to the store, which can be time-consuming and less attractive than online shopping. Lastly, brick-and-mortar stores have limited hours and may not be as well-stocked as online ones.
While brick-and-mortar stores have many advantages over online businesses, one major disadvantage is their high overhead costs. Online retailers save on overhead costs and pass those savings on to consumers. In addition to lowering the costs of operating brick-and-mortar stores, online retailers often offer free shipping and returns.
Costs of opening
The costs of starting a brick-and-mortar store can range anywhere from $2,000 to over $100,000, depending on location, product, and services. Although the prices vary from one retailer to the next, the general cost of starting a brick-and-mortar store ranges from $1250 to $42,000 per year, or roughly $3500 per month. So if you’re planning to sell clothing and other small goods, you should plan on spending around $3000.
As you are getting ready to open a brick-and-mortar store, you’ll want to plan and figure out what expenses you’ll have to pay for inventory, supplies, and staff. By carefully calculating costs and planning, you’ll avoid some of the most unexpected costs, such as credit card processing fees. In addition, you’ll need to invest in a point-of-sale system, accounting software, and a storefront. Finding a good business name is another critical element of planning.
Another significant expense is finding retail space. While it may be tempting to choose the cheapest location, you should consider a prime location if you’re planning on generating a steady stream of customers. Likewise, while affordable places might be tempting, it’s best to invest in excellent retail space, as this is more likely to draw a lot of foot traffic. Finding the right location for your brick-and-mortar store is also essential because prime locations are often pricier than cheap ones.
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