In the final edition of our how-to guide, Drapers asks four independent retailers how they knew the time was right to open branch number two.
Nicola Scott, owner of contemporary womenswear boutique Paper Doll in Pocklington and York
“After graduating from my BA in Art & Design at the University of Leeds in 2003, I started working at York-based premium indie Sarah Coggles [now closed] as a returns administrator, at which point I realised I really wanted to own a shop in York. However, when I decided to make the leap in August 2006, I thought it would be less risky to open up first in a small market town like Pocklington, especially as at the time I lived nearby in Barmby Moor.
By 2013, the 700 sq ft store in Pocklington was established and it felt like the right time to look at York. I reviewed different units and considered moving the store to York, but weighing up the location and the size of store, I thought it would be beneficial to open a smaller 300 sq ft second store to spread our brand name.
I went from employing one part-time member of staff to five staff members across the two stores, including a manager for my York shop.
While we do rotate stock between our stores, we carry more of some brands in one than the other. We carry more Maison Scotch in York, for instance, because the brand is already well-known in the city. We keep the visual merchandising consistent across the two shops. So, for example, the rails and ladders I designed with a local blacksmith for the Pocklington store were replicated in York.”
Sam Withall, owner of mainstream womenswear boutique Sam Brown in Edinburgh and St Andrews
“I opened my first 850 sq ft shop in Edinburgh’s West End Village in February 2011, which cost me £8,000 for the shopfit, excluding stock. Three years later, it felt like the right time to launch in St Andrews, a town I knew really well and that was only an hour away from Edinburgh. I didn’t want to be anywhere further away as it would have been hard to manage the two sites.
I tested the market first, opening a 1,000 sq ft pop-up on Bell Street on a monthly rolling contract in an empty unit waiting to be redeveloped. I used props from home and an old till, so it only cost £250 to open up. I called it The Secret Boutique as I didn’t want to use the Sam Brown branding in case anything went wrong.
After a year in St Andrews, I decided to upgrade to an 800 sq ft permanent store under the Sam Brown name. I chose a location around the corner from the pop-up on Market Street, next door to Monsoon and Fat Face. I spent £8,000 removing a false ceiling and adding new lighting and fittings.
I work Wednesday, Friday and every other Saturday in St Andrews, and Monday and every other Saturday in Edinburgh. In terms of part-time staff, I employ six in Edinburgh and five in St Andrews.
I would not consider a third store. Two is manageable, but three becomes tricky and then you might as well have four or five.”
Karen Hume, owner of two-store country lifestyle outfitter A Hume in Kelso, Scottish Borders
“Established in 1929, our 1,500 sq ft flagship store at The Square in Kelso was struggling to accommodate the product we carry across menswear, womenswear and accessories. We explored the possibility of opening a second store in Melrose, a Borders town 20 minutes away, but decided we wanted to stay in Kelso. We weren’t actively looking for new premises until a rare 750 sq ft retail space came up for sale in May 2012, a matter of yards away in Kelso town centre.
While buying is not right for everyone, I don’t see the point in wasting £30,000 on rent. It’s hard enough to make a crust and if you invest in property that will hopefully appreciate in value. We bought the property for £150,000, with the refit costing an additional £40,000.
We wanted to create a separate space for our technical and footwear stock; moving these products out freed up space to expand womenswear in the flagship. The store’s focus also meant we could introduce new brands such as outerwear specialist Schöffel and footwear label Loake. We try to have separate brands in each store to avoid confusion. Our second store represents 15% of bricks-and-mortar turnover, a figure that’s growing every year.
When we considered expanding, our main thought was about how it would benefit our online operation, which represents 63% of business. We couldn’t sell Schöffel online, for example, without a bricks-and-mortar store. We’re always thinking about how we can get key brands online and increase turnover.”
Paul Monks, owner of premium store Purple Menswear in Harpenden and Berkhamsted, Hertfordshire
“In 2009, aged 23, I opened my first store in a ground floor retail space on the high street in Harpenden. Then, in 2012, I extended upstairs in order to grow our tailoring selection, taking the store to 1,500 sq ft. I decided August 2015 was the right time to branch out with a second store as financially I was in a good place, having achieved £500,000 in turnover during 2014.
I started looking at Berkhamsted, a market town 35 minutes’ drive away from Harpenden with the same retail mix and strong spending power. The town is far enough away to attract a different customer, but close enough for people to be aware of the brand. I thought there was room there to carve out a niche for a premium menswear independent.
Two years ago, I would never have looked at that unit as it was facing an old Royal Mail post office. However, after extensive redevelopment, the unit is now opposite an M&S Simply Food, a Costa and Porters restaurant, attracting just the right clientele for Purple.
I invested £80,000 in opening up the new shop. I have a similar brand mix between the two stores, but opening in Berkhamsted has enabled me to add labels such as Thomas Pink, Hackett, Michael Kors and Boss Green, which I didn’t have space to carry in Harpenden or that crossed over too much with my existing stock.”
Viewpoint: Rinku Loomba, chief executive of womenswear brand Viz-a-Viz
Only expand to a second site if you are achieving consistent profitability from the first.
Opening a new store will take capital to fit out and to build up the stock, so do a full business plan and cash flow forecast to ensure you have sufficient funds.
Make sure you have the right team in place to keep the first store on track.
In terms of location, find a site that’s near enough to manage without cannibalising sales from the first store.
It’s better to keep the brand mix the same in both stores because you can negotiate better terms from existing suppliers and switch stock between sites to maximise sell-through.
A successful second store will drive sales and profit, and bring your brand in front of a wider audience.
You might also have a formula that can be rolled out to create a chain across multiple sites.