Opening Stores Since The Recession Seems To Be Over

Copyright 2014 Dennis S. Vogel All rights reserved.
This blog post was transferred from another service.

Note - I'm not including specific information & references from this & my reply. I've kept the general questions & advice in.
Though I didn't write this advice directly for other blog readers, the issues are applicable to many situations. You can use what I've written (with further consideration & planning). You should use the questions to determine if you have enough information for your (potential) business.

Here's the general part of this message I've based my reply on-
Since the recession seems to be over, some of us are considering either opening stores to replace those that were closed by owners or reopen stores we closed. What advice do you have for us?

In nearby cities, there are successful regional chains, strong big box stores & some struggling independent retailers. The independent retailers are mostly specialty stores.


Subject: Re: Opening Stores Since The Recession Seems To Be Over
This issue can have a potential infinitude of permutations. More details can help you limit what you need to investigate further.

Unfortunately, details may be accurate for short periods, so due diligence is necessary to determine how reliable details are now & will be in the future.

Anybody, who reopens her/his store, should check with a lawyer about possible legalities after having a "going out of business" sale.

It's generally illegal to have a long-term "going out of business" sale. Reopening could be interpreted/misinterpreted as a "going out of business" sale extension, depending what's done & how.

Why Did Some Stores Close - Permanently?
You may've heard rumors/gossip & theories about why stores are shut down. There may be some accuracy in whatever people say.

Were there cash flow problems? Usually, businesses are closed because there isn't enough cash flowing in compared to cash flowing out - or what would flow out if cash were available.

So low 'cash flow' doesn't explain much. Why were expenses higher than income? Why was income too low?

Analogy: A person will faint without a continuous oxygen supply, but diagnosing & solving the problem requires more relevant information. What interfered with oxygen absorption?

Lack of sales revenue may be a partial reason. A business can sell a lot of things & lose a lot of money.

Better questions would be - Why was the sales volume low? - or - Why wasn't there enough of a margin per sale to cover expenses?

"You Cannot Change What You Do Not Acknowledge."
This is Life Law #4 from Dr. Phil McGraw's book "Life Strategies: Doing What Works, Doing What Matters". It applies to every aspect of every life.

Some former business owners might not admit to themselves or to others what went wrong.

When businesses fail, instead of focusing on their choices that led to failure, former owners may blame competitors &/or consumers. Their main problem could be blaming others instead of taking responsibility for solving problems.

Optimal marketing isn't a matter of waiting for consumers to find a business & decide to buy. Business owners should promote products, services & their businesses.

Business owners & staff members have a duty to serve customers by selling enough of what customers want/need.

Some retailers close stores because they want to do it by choice, instead of seemingly being forced by circumstances.

Some retailers want to sell their stores & use the money for retirement funds. If they notice it won't likely work that way, they may close their stores instead of risking more losses.

Knowing why they closed may help you as long as you interpret their reasons as potential warnings instead of predictions of your fate.

Their reasons are based on perceptions of what had been, is happening & could happen. Apparently they felt they didn't have sufficient resources for what they perceived.

You might disempower yourself if you believe your situation will be the same as theirs. You can make necessary changes if you think a particular situation would be the same or similar for you.

You may have or be able to get resources former retailers didn't have or find.

Why do businesses fail? Any business failure could be due to one major mistake or problem, but there are apt to be multiple factors.

Many accurate reasons & theories could apply to one case study. Did a retailer have: 1- enough startup capital? 2- the right inventory & market niche? 3- optimal marketing? 4- enough product knowledge?

The answers for each of these issues (plus others) could be 'No'.

If each cause would be rated as a percentage, the primary cause of failure could be 40% or less. The other causes could combine into 60% or more.

Having enough startup capital is vital, but how much money is enough?

If a store starts with positive cash flow in the 1st month, enough startup capital could be $1,000. But if expenses are far higher than positive cash flow, millions of dollars may be too little.

Is the local market saturated for that product category? Is the overall market mature & declining?

How durable are the products? How likely soon might an upgrade or disruptive product be available to you?

Disruptive products may be produced & sold through different supply chains than the products that are disrupted. Stores in other supply chains get disrupted with the other members.

Are there enough early adopters to buy the latest upgraded or disruptive products?

Optimal Marketing can offset some location issues, not all.

Did their advertising promise/imply more than the in-store experience provided?

Did they (try to) copy "successful" business practices that are inconsistent &/or incompatible with their positioning, USP, 3 Ps, RPV business & customer service brands? Were all aspects of their stores compatible with their market niches?

As you learn more about what your niche members want, need & expect, you should determine what your business culture, strategy & tactics should be.

Businesses May Be Brought Down By Non-Business Problems
Some external problems may contribute to business failures.

There are likely to be multiple reasons for closing a store - some reasons would have higher priorities than others. Some reasons may be personal or familial - private.

Recessions could be local instead of national. Retailers may suspect employers may lay off some workers or leave town.

New taxes &/or proposed laws could cause concerns about business viability.

Was the location unfavorable as far as safety (crime, dark sidewalks &/or parking lots.

Were there enough parking spaces with favorable time limits so people could shop without getting parking tickets & those who looked for spaces could quickly find some?

Were stores handicapped accessible (wide enough doors & aisles? Were stores close to handicapped parking slots?

How many small stores in that city were/are direct competitors?

Even if the risks would be essentially identical no matter who owns a store, some people are better prepared turn some problems into challenges & find opportunities.

Expectations, Goals & Perceptions Of Success & Failure
If retailing partners expect different year-end profits, one partner may think their store is a failure. The other partner may think their store is wildly successful. It wouldn't mean either is wrong or right.

One partner may want to close a store to end perceived risks. If the other partner doesn't have enough resources to continue, the store is doomed.

Anybody may perceive a business as successful, though the owner didn't achieve his/her goals.

People shouldn't expect to have a perfect startup. At some point, planning & analysis could be too much & take too long with not enough action.

Often despite extensive & expensive research, there's no way to know how well a business will work until it's started & attracts prospective customers.

If a perfect business startup is possible, that state of perfection would be relative to a specific situation. By the time a business would be perfect for a specific situation, conditions would change.

You could fail by using whatever standards were good for highly successful retailers.

You need confidence in yourself & the situation you're building. If you think you don't have enough resources, your lack of confidence could work against you.

A balance of working on & working in a business is necessary. Working on a business should start before it's launched. Yet until a business is started, it's just a theory. Eventually, optimal work on a business requires results that are analyzed.

It may be helpful to have experience in retail & with product categories, but it depends on the experience.

Doing the wrong things & learning can be more helpful than not knowing or admitting what went wrong. Not knowing about or refusing to admit mistakes could be a problem with pride.

People may be confident & competent because of successfully doing the right things for years. That thorough experience could be unhelpful now.

Dealing with paradoxes may be frustrating, but necessary.

Thank you for using my blog. Please let me know if I should clarify anything.

Copyright 2014 Dennis S. Vogel All rights reserved.
When you compete against big businesses with big budgets you need powerful marketing strategies & tactics. You'll find them here-
https://thriving-small-businesses.blogspot.com/
http://www.voy.com/31049/


Subject: It's All Competition, All The Time

Some business owners think they offer such special, unique value they don't have any serious competitors. I hope you realize there is always competition that can delay or prevent sales.

I usually avoid redundancy unless I determine extra emphasis is warranted.
Even if you don't have direct product/service competitors, as a marketer:
You'll always compete to be a priority in your niche members' lives.
You'll always compete for your niche members' attention.
You'll always compete for your niche members' interest.
You'll always compete for your niche members' desire.
You'll always compete for your niche members' action.
You'll always compete for your niche members' physical & mental energy.
You'll always compete for your niche members' money.
You'll always compete for your niche members' time.

As your niche members, they may be predisposed to your advertising as long as they recognize your messages as offers of superior value. Since situations continually change, you should maintain superior value.

That predisposition & superior value don't guarantee you a high priority in their lives. Nothing guarantees they'll remember you.

Like random access memory (RAM) in computers, anything can be quickly lost & replaced by something else. You need to be like a computer central processing unit (CPU) & keep the right information in the right "computer code" in people's memories. It's one of your responsibilities, so don't blame consumers for forgetting.

Consumers may opt-in for updates (choose to pay attention to your messages), but sending the right updates is your responsibility.

Is That Relevant? Relevant To Whom? Relevant When?
In case you need a reminder - The statements (above) starting with "You'll always compete" also indicate how many external distractions people endure.

External distractions may be less severe than internal (physical & mental) pains. Each distraction & pain, whether external or internal - adds to & aggravates the others.

It's even worse when external distractions are irrelevant to a person's general life. Each time a person receives an irrelevant advertising message it's like a affirmation of how necessary it is to ignore advertising.

In addition to general life relevance, another concern about making advertising effective is what I call 'situational role & immediate relevance'.

A part/role in a play/movie is a good analogy for each role people have in their lives.

In real life though, it's as if people are in multiple plays & they have to rush from one performance to the next. If they don't perform well, they'll interfere with other people's performances.

Performing well requires mentally & physically focusing on the current primary role & setting aside conflicting roles.

They need you to offer resources they need for optimal performances.

Wouldn't You Like To Get Away?
1st verse of the theme song "Where Everybody Knows Your Name" of TV show "Cheers":
Making your way in the world today
Takes everything you've got;
Taking a break from all your worries
Sure would help a lot.
Wouldn't you like to get away?

Immediate relevance pertains to whatever can help a person thrive - or at least survive - the challenges in a situation. Physical survival may be assured (not currently threatened), but each chunk of stress seems to take a chunk out of a person. Injured pride & reputation can feel like physical injuries.

A person may feel grief when discovering money, time &/or effort were wasted when attempted solutions didn't work. In addition to the wasted resources, a problem still exists!

Successful retailers offer what people need for at least one of their roles. Superior offers could be helping people solve, mitigate or avoid problems (pain).

Superior offers could be helping people attain & maintain relaxation & pleasure (relief from stress).

Whatever results people did or didn't achieve, a superior offer could be a necessary, peaceful distraction to help them relax & recover from stress.

OK, It Makes Sense As Long As I Know How To Use It
Business owners tend to wonder how to use advice from Clayton M. Christensen, Michael E. Raynor, Scott Cook, Taddy Hall, Scott D. Anthony, Gerald Berstell & Denise Nitterhouse about focusing marketing on jobs-to-be-done. Each person has various roles to fulfill. Each role includes responsibilities which include jobs-to-be-done.

This insight about role fulfillment can be added to some insights from these other authors.

Instead of going into more detail about this concept, I'm giving you some gifts. I'm not authorized to give you or sell any copies of these documents, but I've listed the file names. If I included specific links, the links could be broken by the time you read this. You can use a search engine to find these (if they're still available).

As I'm writing this, there are copies of these documents that are available for free. Otherwise, these articles have been available either through paid subscriptions or are individually priced.

Since I have no control over the content or availability, I can't guarantee if what you get would be the actual articles or somebody's warped writings. Here are the file names: ChristensenMarketingMalpractive.pdf
Christensen_Finding_the_right_job_for_your_product_MIT_Sloan_2007.pdf
Finding-the-Right-Job-for-Your-Product-Working-Paper.pdf

People's roles (in business, their families & society) affect which priorities warrant full attention in various situations.

Example: A consultant may want to buy something special for his/her spouse, but a message about that product has a lower priority when it isn't relevant in the immediate situation. Serving a client could be disrupted by thoughts about a spouse.

By effectively & efficiently developing & implementing your strategy & tactics, you may get your messages to niche members, when they can buy what you offer (have time, money, energy & transportation).

What also counts is presenting your messages when your offers are relevant to what people are currently doing or will soon experience.

Sometimes, this can be done with mass media. Often to get your offers accepted, you'll need printed circulars &/or digital messages via mobile &/or web commerce.

Some products & services fit this jobs-to-be-done paradigm better than others. Even when products & services are useful for many roles, some of your messages may be included in relevant contexts. Some role-specific context examples are - events focusing on parents, business trade shows, written articles about a subject, etc. You should do your best to feature the kind of benefits wanted/needed by people in those contexts.

When people are focused on an issue, immediate relevance means other issues have (what I call) a lower action priority. Example - Loved ones are always high among a person's priorities even while that person focuses on another issue. But that person needs to focus on performing current actions even if those actions have a lower priority in his/her life.

What About Another Big Jobs-To-Be-Done Issue?
Find people who have similar jobs-to-be-done by demographic, psychographic, sociographic traits. People may be attracted to events or editorial content to get information to help them with their roles & tasks.

If there are no events or editorial content, you should find others to sponsor the events & content can be Internet/online &/or offline.

Other sponsors hopefully reach people you don't reach yet & vice versa. Build from there by increasing the value, so you get referrals.

Encourage referrals by showing how many more benefits can be provided when each sponsor scales up & can offer more resources.

Consumers may be members of clubs, unions, religious congregations, support groups, social & business networks. You could contact some consumers through their employers.

People can be reached through other stores they patronize. If owners/managers of those stores won't work with you, maybe you can arrange for notices/signs with nearby store owners/managers. There may be legal or policy restrictions in cities, business district & malls.

There are a lot more details I could include, but I also have other roles to fulfill. I squeeze reading & writing in between other things as usual, now there are more things squeezing energy out of me.

I've been struggling more lately to post useful content each month. I have a lot of content, but I need to focus on writing it clearly.

If you need me to clarify what I've written or you think I've excluded valuable details, please let me know. You can post messages here or send me messages via my email address in my sig file.

Unfortunately, I don't check for email as often as I used to do it. I won't guarantee any answers.

I hope we all have better lives in 2015.

Thank you for using my blog. Please let me know if I should clarify anything.

Copyright 2014 Dennis S. Vogel All rights reserved.
When you compete against big businesses with big budgets you need powerful marketing strategies & tactics. You'll find them here-
https://thriving-small-businesses.blogspot.com/
http://www.voy.com/31049/