Online Chat

What is the truth about location and where to open your salon?

Posted on 8th July 2016 by

Location Blog

If I was given £1 every time I heard somebody say, “there are three important things in business, location, location, location,” I’d be a very rich man!

But the reality of today is that the whole location, location, location thing is a load of rubbish!

You see, for so many years I used to nod my head in agreement at these words of wisdom passed down by up and coming entrepreneurs, eager to bestow their experience and knowledge to younger businessmen such as myself. As the words sounded so logical, I was ready to listen and agree at the drop of a hat, nodding knowingly to confirm my understanding. Before long, I found myself eagerly repeating these words when I was presenting or coaching and felt quite righteous in sharing such words of obvious wisdom.

The only problem with the whole concept is that it is flawed: and it took a recession to prove it.

Although the last recession is becoming a distant memory, the aftermath is still very much with us and there is a very valuable business lesson to be learnt from it.

We just need to look at some of the big names that went bankrupt during the recession. From high-end lingerie companies like La Senza to camera retailers like Jessops and even mobile phone companies such as phones4u who either closed or had to restructure. We saw some very well-known high street retailers fail under the adverse economic conditions.

This got me thinking! Some of these high street brands were on the high street! They commanded fabulous locations and yet still were not strong enough to withstand the very cold winter of recession. So what is the truth? How was it that despite having a great location these businesses failed anyway?

Well, the answer is really quite simple. They just weren’t profitable enough!

Despite having a great location, their economic model was flawed by the fact that their margins were too small and their rents were too high and it led me to believe that there should be a new business mantra to replace that old saying about location.

The new age mantra should now say “there are three important things in business, profit, profit, profit.”

So in hindsight, and having spoken to many salon owners over the years who have expanded their already successful businesses into a new unit only to find themselves working for the landlord or the building society. I would always advise being realistic when it comes to anticipating the benefits of being in a prime location.

My personal feeling is that although a good high street location has a lot of benefits, it comes at a price and a price that has to be lived with for the length of the lease or mortgage irrespective of how your business is doing. Location is increasingly becoming less and less important for the modern-day online shopping customer. Fantastic online exposure and marketing combined with a great customer experience will keep customers coming through the door and coming back for more, regardless of where you are positioned.

Greg Web

about the author

Greg Christie is a fully qualified Master Business Coach and salon owner for over 30 years. He helps other salon owners unblock the common challenges that face most businesses today using a proven, industry-specific formula that’s guaranteed to work - even in today’s market. He specialises in significantly increasing profits and at the same time, showing you how to structure your business so you have the time back and freedom to enjoy the increased profits.

For further information, or just have a chat get in touch now

e:              greg@salonbusinessacademy.co.uk

w:             www.salonbusinessacademy.com


3 comments so far

POSTED ON 10th July 2016 BY   Aishath
Thankyou for this Article. I belive what u have said is very true. Location is not that very important for now a days, costs high rent unlike a small business which can make more profit. Profit is what we all need in a running business.

POSTED ON 9th July 2016 BY   Steve Hilliard
Great words Greg! I would also add having a strong brand really helps, which some salons struggle with. My first salon is right out of town and we have been out town for 20 years!

POSTED ON 8th July 2016 BY   Christopher Graham.
Wise words - being the owner of 2 salons we are finding the more rural location of our secondary salon the more profitable and more of a "destination" salon. Incorporating plenty of free parking on site with an award winning cafe and deli on site,niche and independent shops on site. Moving to this site was a gamble, but instinctively we had a "feel" for it and thankfully it paid off. There are also benefits in respect of business rates and your salons USP! I would encourage any young start up business to think out of the box in respect of high street locations and the increasing burden of rents,management fees ,insurance fees,trading restrictions and of course competitors. The high street unfortunately has become saturated with chains of shops,retailers,and hair salons that suck the life out of any medium or small towns across the UK.Paying substantial rents that young business's can ill afford and setting rental premiums that can only head sky high. Think long and hard about that site next to Starbucks - take a bike ride and you may discover just what you have been looking for over the hedgerow tops. Good luck and best wishes.

Leave A Comment

categories

archive

Promotional Banner Webinars


© Shortcuts Software. All rights reserved. privacy
Microsoft
background
INDUSTRY KPI'S - DEC 2012
Shortcuts Collective Market Intelligience
stat:
xxxxxxx%
stat:
xxxxxxx%
stat:
xxxxxxx%