posted
Any thoughts or actual experience of expanding by opening a second locaton in a market that is far enough away that your not competing with yourself? We operate a 5 person biz, myself, wife, two single adult sons and one non-family adult woman. Our shop is well equipped, plotters, table router, wide format printer, edge II, bucket vans, etc. Were growing slowly but steadily, own (making pmts) our 3500 sq ft shop. Annual gross low $300,000's. Making a living and paying our bills, not able to put away money though. My sons will someday get married and will need more $ to raise families and buy homes. I'm thinking we need to be closer to $500,000/yr in sales to net enough to achieve these financial goals. Thinking that a satellite sales office in a market 30 miles away might generate enough new business to cover its overhead and more. The new site would be a short term lease with a computer, phone, fax, internet, plotter, worktables and a lot of displays. Staffed by rotating one of our staff each weekday and me spending half days there every day. There's more to it...but this is the general concept.
-------------------- Tony Lucero Eagle Graphics Waterford, MI www.eaglegph.com Posts: 305 | From: Waterford, MI, USA | Registered: Apr 2000
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-------------------- Dave Grundy retired in Chelem,Yucatan,Mexico/Hensall,Ontario,Canada 1-519-262-3651 Canada 011-52-1-999-102-2923 Mexico cell 1-226-785-8957 Canada/Mexico home
posted
Another way of thinking would be.. instead of expanding into new market, expand the range of products that you can sell the same clients; look into what it takes to print pamphlets, business cards, etc... safety manuals are big business these days, are you into mounting, laminating? You spent a long time getting clean vector graphics of all your clients artwork, what else can you do with it? If you serve restaurants, can you do their menus? Keep it under one roof, manageement might get thin otherwise. ... I've often thought of franchising, my strong technical background, my back ground with large corporations and my management skills have enabled me to build a strong diverse shop, with a product & service mixture that I could transplant to any market and do well; but the reality is that I've been able to build a good business and make real money and enjoy a good lifestyle with 1 location, I'm not sure that added responsibility and constant business travel would make my life any more fullfilling.
-------------------- Mike O'Neill
It has yet to be proven that intelligence has any survival value. - Arthur C. Clarke
posted
2 adult sons - there you go - I would concentrate on maxing out what I could do in your present location. After that set up the elder son in a satellite, let him take it for a spin & see what happens - having a different person in the satellite each day scares me - even if they are up on what's down - logistics would be tricky at best . . . that's just my initial thoughts but what do I know - I'm exhausted from doing installs in this Mississippi heat - - Carl
-------------------- Carl Wood Olive Branch, Ms Posts: 1392 | From: Olive Branch,MS USA | Registered: Nov 1999
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posted
Sounds workable, but why not just a display/sales office with all production at your current location. Then all you would need is one good sales rep. Of course they would need to be fully versed in all phases of your business. Just a thought, but if you were to operate it under a different name, you could limit your product line to better fit that particular set up.
-------------------- Tim Whitcher Adrian, MI Posts: 1546 | From: Adrian, MI | Registered: Mar 1999
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posted
I have tried something like that on a smaller scale, had a fairly inexpensive but visible office with displays and kept it open one day a week as a contact point in the next bigger town. I would go there to deliver finished work, pick up new orders, stay in touch with the local business people, schedule meetings with customers around this day, etc. The idea behind it was to have a presence that would keep them from going into the city with their sign orders. "If they're not coning to me - I'm coming to them" kind of thing.
After several month I found that I still ended up going to customer's places more often than they were coming into my new location. I crunched some numbers and dropped the project on the conclusion that I was better off touring the town every week or so and investing into extra advertising rather than keeping an actual office.
I think it failed mainly because I couldn't be everywhere at the same time. Somehow I still think in principle it was a good idea.
posted
I think having people take turns in the satelite office could cause problems. Customers get used to going into a business & seeing the same person. The familiarity builds a form of loyalty and helps build the relationships with customers.
-------------------- Chris Welker Wildfire Signs Indiana, Pa Posts: 4254 | From: Indiana, PA | Registered: Mar 2001
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10% should be building net worth, pure profit = 30k savings
30% should be your salaries and beny's 90 k a year.
10% should be pure marketing = 90k a year
10 % rent = 30 k a year
So to find a few more bux,, you can raise your prices just a couple points or you can cut costs. OR you can raise a point or two and cut costs.
If your not getting 30% salary range your not in the range of general manufacturign and services. Get yourself a raise
-------------------- Leaper of Tall buildings.. If you find my posts divisive or otherwise snarky please ignore them. If you do not know how then PM me about it and I will demonstrate. Posts: 5274 | From: Im a nowhere man | Registered: Jul 2001
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posted
Thanks all for the replies. I was hoping someone had done this and that it worked out both financially and logistically. I can see the points made of having a steady person there in lieu of a new face evey four days. My thoughts were to economize by not hiring a new player and an added benefit would be to allow our staff to take on a new challenge and break the monotomy of filling the same roles they do at our present shop. I can also see the logic of taking this same energy (without the extra overhead) and agressively applying time and effort into expanding our local market. Looking at my own efforts, I already miss out on some jobs because I don't follow through promptly or give the client or their project enough extra effort. My thoughts and projections were based on higher volumes of straight forward work like banners, magnetics, yard signs, window lettering and truck and van lettering. This is gonna take some more thinking.
-------------------- Tony Lucero Eagle Graphics Waterford, MI www.eaglegph.com Posts: 305 | From: Waterford, MI, USA | Registered: Apr 2000
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posted
Hiya Tony, A second location is good as long as you don't compete with yourself. It seems that you've got that covered. We dabbled with the idea for a while and we found it to be impractical because of the same reasons that Lotti pointed out. So we decided to expand our customer base by diversifying and marketing ourselved through different venues in markets that we did not already serve. What we are now doing is indirectly offering our services though resellers of complemenary products. Some of our new clients are advertising agencies and traditional print shops that would not normally offer the services we provide. For a fee, we will provide the reseller all the necessary tools that would be needed to sell our products; literature, showroom demo units, material samples and pricing. The benefit to these clients is that they are now able to offer a more diversified product line without having to invest in the equipment needed to expand their product offerings. They still have control over the finished product because they do their own design and they can charge whatever they want for the finished product. We benefit because we now reach a market that we did not serve in the past. We've increased our buying power, affording ourselves better discounts from our vendors while increasing efficiency because of the additional work-flow. The investment we have make into this type of relationship is the sales time required to locate these clients, plus the time to train the designers to follow our graphics specifications. The products just about sell themselves. We started this approach about 5 years ago and it took us this long to get the bugs worked out. We are now at the point that we can identify a potential client with little effort and the transition for the client is quite easy.
Good luck,
Checkers
-------------------- a.k.a. Brian Born www.CheckersCustom.com Harrisburg, Pa Work Smart, Play Hard Posts: 3775 | From: Harrisburg, Pa. U.S.A. | Registered: Nov 1998
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