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For you home based framers that moved to a commercial space.

Discussion in 'Picture Framing Business Issues' started by KevinAnnala01, Jan 9, 2017.

  1. KevinAnnala01

    KevinAnnala01 True Grumbler

    Hi grumblers.

    I'm currently working in a double car garage, and want to get into a retail space asap. Actually, I have a realtor out looking at this time. I'm a bit freaked out with the move, as I'm hoping it results in a very quick increase in business. I guess I'm looking for you to share your experience with moving from being home based, to a commercial space.

    Looking at the search data, I do have people looking for, and requesting information as to my hours (currently by appointment), and my location. I suspect that being home based is costing me business, however, to move to a space I need to essentially 2.5x my sales almost immediately to support the change.

    When you made the jump, did you see sales increase? Any things else you can share about making the move would be greatly appreciated.
     
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  2. Gilder

    Gilder MGF, Master Grumble Framer

    If I had a double car garage and some business I would stay there as long as possible. And longer.
    About the space: I would be looking for it myself, no matter how long it takes. Location and right space
    is essential. Don't rush Kevin, if you can of course, because I don't think you can increase your sales
    that much right away. Your goal right now is finding right place to rent. If it's good, you good. If not,
    you're going to have really hard time.
     
    Jim Miller and shayla like this.
  3. David Waldmann

    David Waldmann SGF, Supreme Grumble Framer

    I'm with Gilder on this one.

    One option you might consider is to pursue business that doesn't care if you're home based, such as meeting at the clients' site - decorators, interior designers, commercial, etc.

    BTW, IMO you already have a leg up on many home based framers in that you have a ground level (possibly detached?) space in which to meet. As a "sometimes sales rep" I've been amazed at some of the locations our customers work in as it's very invasive to their private space. Our town allows a small sign for "home businesses" in residential zoned areas. If your locale allowed that, and you have a stand-alone building that is paid for*, I would be hard pressed to up the ante. I know someone in a totally different business who wants to expand, but they are currently working out of their (paid for) garage, and the amount of business that needs to be generated to just break even by moving to a pay-for site is staggering.

    *By which I mean, if you take your business elsewhere, you will not "save" any money by not using the space for the business. You are paying for it, or already paid it off, personally, and that will not change if the business starts paying rent elsewhere.

    BTW, welcome to The Grumble. I wish you the best.
     
    Jim Miller, shayla and Rick Granick like this.
  4. Ylva

    Ylva SPFG, Supreme Picture Framing God

    I would stay home based for a bit longer until your current sales warrant a retail space, not vice versa.

    Start by keeping some regular hours, not just by appointment only.
    Maybe update your current space a little to make it more customer friendly.
    If you don't have a website, create one now
     
  5. CB Art & Framing

    CB Art & Framing SGF, Supreme Grumble Framer

    I have a tiny space, 200 sq feet, in an Artist Studios building and its working out pretty well.
    No walk by traffic, but can meet by appointment, can receive deliveries and I keep it very tidy.
    Customers can sense that overhead is low and it reflects on their perception of pricing.
    Many comment that the location is 'cool'.

    If you do go more retail, signage is crucial!!!!
     
  6. Joe B

    Joe B SGF, Supreme Grumble Framer

    I am home based and am extremely busy. I'm in a stand alone 24 X 24 garage behind a privacy fence and meet with customers by appointment only. I would never go to retail space because I would have to triple what I'm doing here to come close to what I am doing here. I have 3 Michaels, 1 Hobby Lobby, & 2 JoAnnes within a 5 mile radius and I do not consider them as competition. Several of my framer friends have gone from store fronts to home based and are glad they have.

    If you are doing business being home based stay there if you can and if you have significant space. Go out and promote your business. Introduce yourself to resturants, hotels, hospitals, and so forth and give out your card to the buyers explaining what you are doing. All three of those industries are always changing out old art. Hand out your card to everybody you meet, you will be surprised by the return. I have even had a couple people at the garage that changes my car oil come to my shop for framing.

    I promote my appointment only as a convenience to the customer, which it is. My customers don't have to wait around while another customer is getting waited on, my customer gets one-on-one attention, there are no disturbances, and I will be there and not out to lunch or picking up supplies when my customers show up. My customers love the appointment only and I'm sure that me being home based is not costing me any business. Promote being home based as being home based, don't be embarrassed about it. Make sure you give you customers their money worth with your knowledge, designs, quality of your work, and your person to person attention.

    Above all, don't give away your work. If you undercharge you customers will think that you are cutting corners and are not doing quality work. No matter what you decide, lots of luck. Joe B
     
    Last edited: Jan 10, 2017
  7. Bob Carter

    Bob Carter PFG, Picture Framing God

    Another opinion...

    determine your goals and see if your skill sets can attain that goal. The biggest mistake, IMO, is not being honest in that inventory. There are many self-employed framers that are perfectly content at your current level

    However, if you expect/need more consider the option from a purely biz point of view. Pretend it's a muffler shop, florist, shoe repair

    If you go 'storefront' you might be wise to create a list of 'new requirements' a store need. I mean signage, displays, employees, etc. A keen sense of business management is essential. You might privately seek some guidance from many grumblers. Count on a pretty sharing group

    Lastly, my personal opinion:It concerns me that you seek opinion on taking a step. I might suggest you build a better plan before engaging a RE Agent. First, I would do a personal inventory on your abilities. I used to teach a class on determining strengths/weaknesses on you, your competition, your market

    I can't tell you how many legal pads I have gone through starting several businesses. But, lets say case lots comes to mind LOL. You would be wise to seek a mentor outside the framing biz, too
     
  8. FramerCat

    FramerCat SGF, Supreme Grumble Framer

    This is just an idea. Have you looked into setting up a retail space (basically counter and samples) inside another existing business. You could still do the chopping, joining, mat and glass cutting at home while taking orders and fitting at the retail space. This could be considerably less costly depending on the arrangement you can set up. You might be able to work with a gallery who does not currently offer framing or a sports memorabilia shop or any number of other compatible businesses.


    Ed
     
  9. KevinAnnala01

    KevinAnnala01 True Grumbler

    "Lastly, my personal opinion:It concerns me that you seek opinion on taking a step. I might suggest you build a better plan before engaging a RE Agent. First, I would do a personal inventory on your abilities"

    Thanks for the concern. I've run the numbers, know how much I'll need to generate in additional sales per month, margins required, etc. Looking for people to share experiences with making the jump, as with anything, I don't know what I don't know and might get some nuggets.

    I agree with you regarding needing a mentor... working on that.

    Thanks all, much appreciate the replies and would love to hear more.
     
  10. DVieau2

    DVieau2 PFG, Picture Framing God

    Welcome to the Grumble.
    Your smart for asking questions.

    Use care with Property Managers and Agents.
    Many use the warm body with a pulse as a standard to qualify.

    Trust your instincts when it come to a location. Go around by yourself to interview other stores in the same building or area to get a feel for the landscape.

    Be very wary of centers with lots of vacant space or an anchor tenant about to close.
    Look to the city for future road closings.

    The trend for framers is to jump in the opposite direction your headed. I spent 30+ years with a retail location and now work from my home.

    What kind of location do you visualize for your business?

    Doug
     
  11. Bob Carter

    Bob Carter PFG, Picture Framing God

    one more thing, many framers look at rent/location as a way to 'save' money by leasing a 'cheaper' place. Many will disagree, but in Biz there is a reason for 'location, location, location' advice. Not suggesting getting 'prime location' but taking a 'lesser space' to say a small amount of rent is short sighted. I'm a big fan of getting close to places frequented by a 'target' customer. For example, a Starbucks can easily generate a lot of traffic and perhaps someone willing to pay $5-6 for coffee may not as price sensitive LOL

    may I 'volunteer' Doug? PM him to see if he might help. He has seen a lot, done a lot. He's a bright guy with a lot of experience especially at your level. I know him and he is a sharing guy
     
  12. samcrimm

    samcrimm CGF, Certified Grumble Framer

    Location Location Location, I am moving into a Building that has women bouquets in it. It got to be a hot spot! I am hoping to capitalize on the location. Rent is a little high but the location is a great one.
     
  13. Grey Owl

    Grey Owl SGF, Supreme Grumble Framer

    2.5 times increase sounds like a lot, to me. Is there a way you can build your business more before you consider a move? As a very rough rule of thumb, I figure that, based on general ratios that I have heard, for a retail location to be successful, you need more than $100,000 in annual sales, and at that you would probably be paying yourself minimum wage, if that. And in some locations nearer $150,000 is a minimum.

    I don't know about your background in framing. Have you gone to the WCAF in January? There are lots of classes, and it offers a great chance to talk face to face with lots of other framers. Get lots of great ideas, and also meet alternative suppliers. If you can't afford to go to this trade show, you probably can't afford to consider having a store front.

    I am also home based. Pluses and Minuses. I do quite a bit of corporate, so that is a plus. For me another plus because I have lots of doctor appointments for family members I need to go to. I don't have to try to get store coverage when I'm gone. Working by appointment helps overcome this. Yes, one of the minus's is I don't get any walk-in traffic.
     
    Joe B likes this.
  14. JWB9999999

    JWB9999999 SGF, Supreme Grumble Framer

    I will be the third person to say it: location, location, location. The right location will make it easy, and the wrong one will bankrupt you, regardless of anything else. But no one here can tell you what that magic location is, you will have to find it yourself using your local knowledge of demographics, shopping patterns, traffic, target customer base, etc.

    I also agree that 2.5x is a lot. That doesn't mean you can't do it. How long are you willing to wait to make it to that number? If you REQUIRE it in your business plan to happen in 6 months, you are setting yourself up for failure. If you can afford to move to a new location and can take 3 years to get to that number, then you are very likely to succeed.

    And keep your estimates on sales conservative. Very conservative.

    I started a new retail business 3 years ago (non-framing), in a retail location, shared with my framing business. I developed a range of sales estimates in my business plan, after being in this area for 8 years and learning a lot about my potential customers. But it took me 3 YEARS to hit my absolute LOWEST sales estimate that I predicted I would get in year one. Just got there this last December, and I forecast better things in the coming years. But it has been a much harder path than I'd anticipated. So far, my biggest challenge is getting the word out that this new business exists. My sales volumn could easily be triple what it is (hence my original estimates), but people don't know the business is there to serve them. It's been a real challenge in today's fragmented media market.
     
  15. Bob Carter

    Bob Carter PFG, Picture Framing God

    Hey Grey always enjoy your insight. Do we have any industry numbers on average volumes? $100K Revenue seems really low to make a biz a biz. Seems like years ago, ind average was about $160K? Perhaps people can be viable at that level, but 'risk/rewards' seems awfully poor.

    Any numbers?

    I love that 'fragmented media market' phrase. It would be interesting to see if anyone has any Market Share size for BB's, indie retailers, ma and pa's, internet? Been too long since I had access LOL

    Any guesses?
     
  16. KevinAnnala01

    KevinAnnala01 True Grumbler

    hah... "And keep your estimates on sales conservative. Very conservative."

    I can assure you I've been slapped quite hard by that reality a few times lol I'm sure we all have at some point.

    Fantastic group here. Appreciate the feedback so far.
     
  17. dsmframes

    dsmframes Grumbler in Training

     
  18. dsmframes

    dsmframes Grumbler in Training

    I've been framing on an wholesale basis for years and am trying to expand a bit. I'm looking for advice on pricing retail. Is there a formula that you use?
     
  19. Larry Peterson

    Larry Peterson PFG, Picture Framing God

    Another alternative is to expand online. I am online only after closing my shop in 2006. My main site, thePaperFramer.Com, has been open since 2001 and is primarily for people framing newspapers and magazines. I opened an Etsy shop, https://www.etsy.com/shop/thePaperFramer, two years ago and have done well by it. Not for everyone but Etsy is an interesting alternative.

    One thing I should note is that I don't use glass, acrylic only on my frames so no expensive packaging required to protect glass.
     
  20. Joe B

    Joe B SGF, Supreme Grumble Framer

    Sorry, I do not discuss pricing mark-ups or COG on the open web. You can post your question in the "Members only" at the top of this front page of this section.
     
    Last edited: Jul 14, 2017
    Grey Owl likes this.
  21. wpfay

    wpfay Angry Badger

    Kevin, you sound like you've done your homework with your business, but have you shopped your market to see what other shops are charging? You have based your current pricing on what your current overhead and expenses are, how do you plan on adapting to the increases other than plan/hope for greater volume? I don't know how you price your products now, but if you plan on moving into retail space and are going to successfully take on the added expense, the time to start tweaking your pricing is probably last year.
    We've been in a retail location for 44 years and the thought of downsizing the operation to a 1000-1500 sf workshop is really appealing. Working from a home base has all kinds of advantages, and a retail location has new and different challenges. Again, I don't know your particular situation, but in arguing a bit with Bob and the other "location" folks, the maxim now may well be "SEO, SEO, SEO". Amazon didn't have a storefront (until they bought Whole Foods). Buying into a bunch of overhead by renting retail space will only insure that you have to work a lot harder for the same return.
    If I were starting out in the industry where you are today, I would seriously consider spending a couple grand and get some in depth business consulting from someone like Ken Baur (KB Consulting). He also teaches at WCAF and other regional events. He can look at your business and tell you exactly what you need to do to get where you want to be, and how hard you will have to work. This place is great for advice, but it doesn't get to an in depth level with your local economy, and your personal goals.
     
  22. Grey Owl

    Grey Owl SGF, Supreme Grumble Framer

    Bob, I just realized that I never answered your question. I have no numbers, but for home based, I personally believe the numbers can be smaller, and I know several home based that are much smaller than the $100K figure. But it works for them because their spouses work, or they are retired, and they just need to make something to supplement their income.. And yes, they do have POS systems, CMC's, etc.

    I do believe one of the mistakes many home-based framers make is not pricing high enough. And most home-based framers don't get the volume discounts that store front retailers get, so their COM's are generally going to be higher than most. [I am the exception there, because of what I do, I believe my COMs - cost of material % - are much lower than most framers.

    For a retail location I figure some framers would be able to make a go around a minimum of $100k levels, depending on the customer base they cover. For example, one of my framer friends that is an economically depressed area was paying around $650 a month rent. Add electrical and gas, POS system rental, Insurance, I suspect their total fixed costs were less than $2,000 a month. And if their COM's were near the average, they could certainly have a going business.
     
  23. Bob Carter

    Bob Carter PFG, Picture Framing God

    thanks, Grey. I agree most HB do less than $100k and their needs work for them. I presently use a former employee that is retired but has full shop. I am her best customer at about $200/wk. cutting mats and mounting. I supply materials; she pockets almost everything. Works for her

    The retail example is hard to understand for me. But, there is nothing wrong with being a self-employed framer. If I used your numbers at $8k ave/month; if we accept 30% CoG that leaves a little over $3k/month for wages, personal taxes, retirement travel to trade shows, health insurance and those ever present misc expenses. That takes it down to about $10/HR or less depending on rigid 40/hr week. I suspect 40hr work week is rare?
    To Wally's point I agree very few framers should pay top dollar rent. Bt, I'll share a real example. A frame shop here is in a 'L' shaped strip center, Long leg faces very popular street, short leg faces secondary road. biggest attraction store pretty much middle of long leg. Frame shop at end of shorty leg. Short leg has three stores; one vacant for long time. Parking in front of short leg maybe 7-8 spaces. They say it's worth it btraffic.ecasre it's $700/mon cheaper for maybe 1/10th the traffic.

    My opinion: an extra $1100/month and you have covered the 'nut'. Maybe 1 additional customer a week? That's what I'm talkng about in 'saving rent'

    I full well understand that works for some but I'm guessing most had a 'rosier' expectation when they opened

    thanks for your thoughts
     
  24. Paul Cascio

    Paul Cascio SGF, Supreme Grumble Framer

    I think those outside of the industry, and many within, would be surprised if they could learn just how volume much some home-based businesses might generate. More so, (I always wanted to use "More so" in a post.) when we stop to calculate how much of that could possibly trickle down to Net Profit. Not all of them, and not the semi-professionals who are only interested in financially supporting their hobby, but running a framing business from home has a lot of advantages.

    I'm confident that there are many retired retail framers, who are now working from home.
    And they should. They've earned a very nice advantage, and IMO, they're smart to take advantage of it.


    HB's operate their business with the luxury of having virtually no fixed overhead. That alone is a huge positive, potentially enabling you to compete against even the largest competitors. And, it lets you give consumers more of what they want. I could write for hours on this, but I just don't have enough time to give the subject justice in this space.
     
    Last edited: Jul 18, 2017 at 2:46 AM
  25. Grey Owl

    Grey Owl SGF, Supreme Grumble Framer

     
  26. Grey Owl

    Grey Owl SGF, Supreme Grumble Framer

    I agree that $100,000 a year is not pretty for a store front, and that is why I think of it as a probably a minimum, but many framers in smaller or remote communities are not going to be going to trade shows or doing many of the things we would like to do. And they may only be open 5 days [or less]. So with 8k per month in sales, 2k in expenses, 2.5k in COM, yes all one has is 3.5K a month for everything. And it works for some. And again, in smaller / remote communities, a job / any job at $10.00 an hour is good.

    I met a framer couple from Akron Colorado when I was picking up some materials at our local distributor. They have a frame and gift shop. They drive 116 miles each way every two to 3 weeks to get groceries and framing supplies, as no one delivers there. The town has less than 2,000 population, and the county has less than 5,000 for an area of around 2,500 square miles. In talking about their market, they basically said, there are no jobs [except for the agriculture], and if they didn't have their shop they didn't know what they would do.

    In more suburban markets $100,000 is probably too small, but in many parts of Colorado, Wyoming, Nebraska, Kansas, and New Mexico, the market is certainly different.
     
  27. Bob Carter

    Bob Carter PFG, Picture Framing God

    thanks for that perspective, Grey. Key here is to know your market, know your numbers and know your expectations.

    I just automatically think Albuquerque, Denver, Laramie, Omaha...:D

    Lot to be said about what works for them
     
  28. Chris Chewning

    Chris Chewning True Grumbler

    I'm 100% with you on this Paul. And I honestly think HB's have been underserved in the communty for discussion as a whole. It's part of the reason I started a HB Framers facebook group. So we could discuss the HB perspective of running a framing business.

    Btw if anyone is a Home Based framer and is interested just shoot me a message and I'll send you a link.
     
  29. Joe B

    Joe B SGF, Supreme Grumble Framer

    Hey Chris, I'm interested and sent a PM. Joe
     
    Chris Chewning likes this.
  30. David Takes

    David Takes Grumbler in Training

    There are advantages to being home-based, but there are obvious disadvantages. The advantages of making the switch to a commercial space are NOT going to hit your bottom line as quickly as the immediate overhead will, so you need to have the resources to bridge that gap. I wouldn't make a move like unless I had at least 24 months of projected overhead in the bank as a reserve. As a whole, in the long run, you would be better served with a highly-visible commercial location. That comes with some risk, so you will need to do your market research to evaluate if your business model's demographic is currently being served well in this format. In your situation, only you can determine if this is wise business decision for you. I know in my market of about 80,000 population, we have dwindled down to only one professional frame shop outside of the services offered by Hobby Lobby and Michaels.
     
  31. Joe B

    Joe B SGF, Supreme Grumble Framer

    So you say - and why is that? You really haven't given a compelling explanation to your statement. I have known many framers in the last 16 years that have gone from commercial storefront to home based. At one time the High Visible commercial location was necessary but in this day and age that is not so true. I've been home based for my full time and my shop produces income that many commercial storefronts only wish they produced. My expenses are less only by the lease because I still pay for heat, electricity, maintenance, & insurance. I have to carry as much insurance as if I were commercial and I have a stand alone building so the maintenance, heat, electricity, and garbage is all on my business.

    Picture framing is not looked at as a necessary expense by the consumer like it was in the '80, '90, and early 2000s. Frame shops are now a destination not a "OH LETS WALK IN THERE AND GET SOMETHING FRAMED" - we are not the spur of the moment type of business. If you have an art gallery attached, that is a totally different story but still you don't need a highly visible commercial location for that either, though it would help. I have several friends who are framers and also have a gallery that are located in low visibility industrial parks and old remodeled buildings that are doing well.

    You will hear pros and cons from both sides of the fence but there is no proof one way or another that high visibility locations are the way to go for a frame shop without a gallery in todays market. just my $0.02 Joe B
     
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  32. David Waldmann

    David Waldmann SGF, Supreme Grumble Framer

    Both answers are right, depending on what your business plan calls for, or possibly even where you live.

    For instance, I think you would have a hard time running a multimillion business out of a home. So if you want a multimillion dollar business, HB is probably not for you. In fact, some jurisdictions don't even allow businesses in residentially zoned areas. In our town you are allowed to have a home business, but you can't advertise (including not having a sign) or have more than 4 employees.

    OTOH, as Joe points out, it's possible to be more profitable as a one-owner home business than a multi-employee store front.
     
    Chris Chewning likes this.
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