Business problem turnaround: Second location isn’t replicating the original location’s success

October 4, 2017

Business was booming and you decided to take the next step—a new location. You’ve tried your best to clone the success of your first location, but your new location just isn’t performing as it should.

It’s a frustrating problem, so we’re putting some thought-starters on the table. Think through whether any of the five tactics below might start you down the road to a turnaround.

1. Get scientific.

Isolate the problem by comparing locations to determine how your new space is underperforming. Are overall sales slower? Are costs higher at the new place, eating into profits? How does the per-ticket transaction amount compare between the two? Is there enough foot traffic to generate enough sales? Clover Insights is tool that can help you dissect the problem. Not only can you compare your two locations, you can compare your stores to competing stores in both locations. This will give you a sense of whether the location itself is contributing to poor business performance, or whether there’s something not quite working yet in the new store that you need to address. Isolating the issue can help you trouble-shoot quick ways to turn the business around.

2. Take stock.

Now that you have a good idea of what the problem might be, it’s time to take stock of your resources to turn things around. Do you have enough staff at your new location to help increase sales? Do you have money to do some special promotions?

Take the information you gleaned above and determine whether you have what you need to address the problem. For example,

  • If the per-ticket amount is lower in the new location, you’ll need to come up with ways to increase the amount of each sale. This conclusion can raise more constructive questions like: Is the staff in the new location trained to upsell or cross-sell additional items? Would temporarily moving some of your more experienced staff to the new location to train the newbies help? A different tactic might be to display impulse buys near the register to encourage impromptu sales: Do you have enough inventory of these items, and are they displayed effectively?
  • If foot traffic is low, perhaps you haven’t successfully gotten the word out that you are open for business. Try promotions directed at local businesses or residents. Spending money on converting locals into customers is a good investment, because they are more likely to become return visitors. If you have some customers, you can test giving them special deals that they can pass on to family and friends. Apps like Digital Word of Mouth let customers share information with their contacts easily and can simplify marketing. Also consider trying location-based marketing techniques, including SMS push notifications with TapLocal Marketing, Adwords, or social media sponsored ads. The Clover App Market has tons of tools to help you market a new location. (Also check out our previous post, “Dealing With Slow Foot Traffic“.)
  • If costs are higher at the new location, look for ways renegotiate some of these costs. For example, ask the utility company to do an energy audit, inquire in the town if there are any tax breaks for new businesses, or buy in bulk to reduce delivery fees. If the new location is just too expensive to keep open as a brick-and-mortar business, consider whether you can open a mobile location like a food truck or rent space from another retailer.

3. Automate and outsource.

Many entrepreneurs fall into the trap of trying to do everything themselves. While your passion and drive are likely key reasons your business was successful enough to open a second location, it’s highly unlikely that you’ll be able to split that passion into two locations without a little help.

Take a step back from the business and consider what key elements are necessary to make your business work. Brainstorm ways to replicate those success factors with minimal involvement from you. Can some of the more mundane tasks, such as scheduling and staffing, be automated with an app? Are you getting the most out of the equipment and people you already have? Clover can help you leverage your POS system to manage different aspects of your business from accounting, to marketing, to ecommerce.

4. Go mobile.

If you’re not able to spend enough time at the new location, make sure you have real-time access to your systems and progress at both locations. A mobile POS helps you maintain visibility into both locations—so you can spend more time where you’re most needed. If long lines are discouraging sales, you can also use your mobile device to line bust, or experiment with sidewalk sales or other mobile locations.

5. Rally around the cause.

If you reach the point when you think you have a good idea of what’s not working and have the makings of an action plan on how to tackle it, it’s time to get your staff behind you. Make sure they understand their role in making the business a success. Ask top-performing staff to train others in customer service and upselling techniques, and make sure to motivate them periodically. For example, consider tracking who brings in the most sales and motivate them further with an extra perk or a piece of the action. Now that you have a second location, you need a team of people to help you make it a success. Don’t go it alone: Call and ask for our multi-location support. Related: 4 Employee Empowerment Strategies You Can Try Tomorrow [on-demand webinar]

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[image: Sidewalk by Simon Zirkunow on flickr]

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