We don’t often advertise stalls for sale on Victraders but we did advertise one this week and it has raised a few questions. In particular, should you be selling your business on the basis of current takings or potential takings?
The global retail industry is in recession, or at least the brick’s’n’mortar category is. Retailers who sell strictly on line or have a strong online component may be doing better. The industry is transitioning from the old way of retailing to the new way and it will sort itself out in due course. It might take a few years but there will be a new retail order of profitable retailers.
So, right now stall sellers are selling potential. They are selling a framework which, with the right input, can be a significant business in the future. That input might be global buying, new product injection, and an online sales structure including websites and social media. Marketing online has great potential and opportunities to sell through Facebook and Instagram are improving all the time. If you have taken advantage of the SBMS mentors you will know of that potential.
But all that potential is likely to be built on a sound bricks’n’mortar base. We know there are many pure online retailers who have introduced physical shops because they know shops are an essential part of the full offer. Even Amazon is doing that.
It is true that making a profit in retailing is difficult at the moment. But this is an industry in transition, and for those willing to take on the challenge, stalls at The Queen Victoria Market have a real attraction – low cost, access to big crowds (particularly tourists), and a flexibility found in few other categories.
You may have decided it is time to move on. You have operated in a time of traditional retailing that now needs new skills and a new approach. Your business has value, particularly if you have good spots and a potential buyer will recognise that value. Handing over to new operators, passing the baton, whatever you call it, is a great opportunity for the right entrepreneur. That is worth something. Don’t sell yourself short.
By Greg Smith
By Greg Smith