Wednesday 17 January 2018

Is it worth refocusing my business to a single base when one isn't performing well?

Problem Solver

Fergal Quinn
Fergal Quinn

Feargal Quinn

I run a print business with a print retail unit in two separate towns 80km apart. One outlet performs very well while the other is just breaking even. All of our printing is done at one separate location. Can you give some advice?

Fergal Quinn replies:  One of the many definitions for business strategy is "to attack when you are strong and retreat when you are weak". All too often, I meet businesses who fail to take this advice on board and try to fix something which may already be broken beyond repair. I have no doubt there will be a big temptation to keep working on the outlet with the lower performance and hopefully someday it might just turn around. The bigger question is what resources and energy are being wasted that could otherwise be put into the main business?

From what you describe, the production process is isolated from the two shops and the shops act as a public "shop front" to promote the business. My advice would be to close the poorer performing of the two. However, in advance of this, mount a strong marketing programme to service the business via the other branch and central facility.

Strong communication with the existing customers of the branch that will close will be really important. You will find that many of them will be more than happy to stay with you if they understand what is happening. Perhaps get some promotional incentives to continue to do business after the branch is closed. You may also be able to redeploy some of the staff from the shop and put them on the road as sales executives to recruit new business. I know it will be a difficult decision for you to close a branch that has taken you so long to establish. However, the business is giving you signals that you should listen to and I firmly believe you will be in a far better place once you have made this transition.

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