The Five Mistakes People Make When Starting a Retail Brand
Venturing into the retail design industry is an exhilarating journey filled with potential and excitement. Many aspiring entrepreneurs, driven by this thrill, dive in with enthusiasm but often overlook critical aspects that could make or break their business. I have been working with retail brands for almost 20 years, and I have seen it all, but there are mistakes I see over and over again: mistakes that can cost hundreds of thousands of dollars, mistakes that will break your bank and destroy your business. However, with proper guidance, you can navigate these challenges and pave the way for a successful retail venture.
The good part is that you can learn from these mistakes and avoid them in your journey. I am here to share these lessons with you.
1. Renting a Space Without a Design Team in Place
Most of my clients call me after they sign a lease. They usually call three or four different designers and start getting proposals. By the time they decide on one and sign a contract, a month has passed—a whole month of rent is gone.
When building a brand identity, there is so much to discuss and plan. Start early to ensure you have a solid foundation and a clear roadmap for your retail venture. This proactive approach will give you a sense of control and preparedness without wasting your money.
2. Believing You Need a Location to Start Designing
Contrary to popular belief, you don’t need a physical location to begin designing your retail space. Most floorplans look the same. If it's the layout that concerns you, trust me; it's the least of your issues. When you look at any established brand retail store, you can see that they are more or less all the same. For instance, a Prada store in your town and another one elsewhere, if built during the same period, they have the same look. Once the design is in place, it gets replicated in each location, so why do you want to rent a space so early in the game?
It might seem strange, but you can design an entire store based on a dummy space; we do it all the time. Decide your typical store size, look at the average floorplan of the spaces you like, and use one of these to design your space. You can select or design colors, materials, furniture, lighting, customer flow, technology, and so much more without the actual space. You can spend a year on the design if you want to. You can take as much time as you want if you don't have a monthly rent to pay. When you are ready, then you can find a space and adapt the design to it in no time. Do you know how much money you just saved?
3. Selling Before Building a Brand
Many believe that a brand starts with a logo, but a logo is not a brand. A brand is what people say about your business when you are not in the room. Jumping into sales without a well-defined brand is like trying to sail without a map. Your brand encompasses your mission, values, and the overall experience you promise your customers. Building a solid brand foundation before selling helps create loyalty and distinguishes you in a crowded market. A strong brand goes beyond visual identity; it involves creating a memorable story that resonates with your audience. This is why it's crucial to focus on building your brand identity and customer perception before you start selling your products or services.
4. Lack of a Clear Mission and Differentiator
In a saturated market, what makes your retail store unique? Without a clear mission and differentiator, you risk blending in with the multitude of other stores. Your mission should reflect your core values and resonate with your audience. Identify what sets you apart—be it product quality, customer service, or a unique story —and emphasize this in all aspects of your business. A clear mission helps attract and retain customers who identify with your values. This is where market research and customer feedback play a crucial role. Understanding your clients and their needs is critical in such a crowded marketplace.
5. Insufficient Funding
Opening a retail store is expensive, and underestimating the costs can lead to premature closure. According to industry reports, a significant number of retail stores fail within the first 6 to 12 months due to financial strains. It's estimated that about 20% of retail businesses fail in the first year, primarily due to financial mismanagement and lack of capital. Ensure you have enough capital not just for the initial setup but also for sustaining operations through the early stages of growth. Detailed financial planning and securing sufficient funding can prevent your dream from becoming a nightmare.
I hope the insights I shared here prove to be helpful in your journey into the retail industry. Remember to stay proactive, keep a clear vision, and ensure you have the necessary resources to support your venture. With the right approach and careful planning, you can navigate the challenges and pave the way for a successful and sustainable business.
Good luck!
Image by @rrmedicinals
