When do you cut loose from a losing store?

I'm still learning a lot about starting up a new business in SL, and mostly learning from my mistakes. Some decisions are hard to make when you don't have any measure for comparison, so I'd love some comments or feedback on my newest "challenge."

In addition to a shape store that is on my land, and costs me nothing extra to run, I've also rented store space in an island that seemed a good fit with my market niche. The rent is quite cheap, cheap enough that if I sold just one shape I'd pay for two months of rent. So I figured it would be a no brainer to keep that location going.

Well, six weeks have passed and I haven't made a single sale. Even the landmark giver has only only been used a few times, whereas the one on my land is used at least several times a day. Part of the problem is that lag has been so bad that I don't dare advertise that location -- my products don't even show up until you stand in place over a minute. But at the very least I expected some foot traffic from residents who have, presumably, given the mall area time to rez.

Rent is due at the first of the month, and I'm wondering whether it's worth it to renew for yet another month. Is 6 weeks too short a time for assessing a store's viability?

My regular sales -- from my land and from the SLE and SLB -- are quite modest but steady. Which makes me really wonder why there's such a black hole at that location.

and of course, marketing is allways king, if you dont market hard, ppl wont know about it.

you can't expect to make much on 'random passerbys' you gotta drive traffic

As a newbie myself, with plans to go the same route you have, I'm interested in a list of those mistakes

I had a similar problem myself.

I wanted to try adding a 2nd location, so I went to a mall in a sim where I really liked the sim owners, they're great friendly people, and the mall is almost always full (very few empty stalls). The rent was very reasonable so I payed four weeks' worth. After about 3 weeks I hadn't had a single sale, and was getting disappointed.

The owners of the sim were very helpful, I would say they went above and beyond in fact, in helping draw interest to my products. In addition, I added a L$50/week classified and updated my profile Picks to include my spot in the mall. As these things all happened around the same time, I can't evaluate their effectiveness individually, but I will say that the sales in my main location have increased, traffic at both locations have increased, and sales at the secondary mall location picked right up, now accounting for about 15% of my overall sales.

I know this doesn't exactly answer the question... but perhaps some ideas to help you if you decide to extend it a bit more. Two comments you made stand out in my mind - you have not advertised the mall location, and the mall location suffers bad lag. I would suggest that any location that isn't getting advertising is going to show poor results. My experience has been that two L$50 ads do not 'compete' with each other but instead work in tandem, so advertising a secondary outlet, IMHO, does not draw customers away from your primary location.

The lag issue is more problematic. For me, that would probably be the deciding factor right there. Regardless of how great your product is, if your customers cannot see it because it won't rez, or they can't walk over and buy it because the lag is holding them back like walking in treacle, then the sales are going to suffer.

Shameless plug: Check my in-world profile for a great new mall on a brand new class-5 island. Competitive rates, available space.

-Atashi

Having been through this myself, I'd say the combination of lag and no sales in six weeks should cause you to write off that location. There are many, many malls out there. My advice would be to do a search and go to several that have extremely high traffic. Make sure they're not laggy (a major turnoff for shoppers), and try renting a stall there. You'll pay more, but you generally get what you pay for exposure-wise. Don't pay more than two weeks rent -- I've generally found that to be ample time to tell if a location is good or not. Once you have your items in place, post a L$50 classified ad to give it that extra push. If after two weeks you haven't made enough to cover what you paid for rent and the classifieds, look elsewhere. Eventually you'll find the perfect spot for your products.

I would worry a lot if I came to my store location and nothing rezzed for several minutes. If you can't see the merchandise, neither can anyone else. And they won't buy what they never see.

I usually give a new mall location 2 to 3 months to pan out. During that time, I have it listed in my picks and I take out a minimum-price classified ad. More often than not, if the location is good, they are breaking even or at least showing promising sales by then. While that trial period is going on, I randomly go to the locatiion. Can I move, or is it a lag fest? Do I see shoppers, or is it empty? Is the sim busy, and are there people coming through the store, or are all the green dots clustered at some zombie farm on the other side of the sim? If conditions look good, I might extend another month. But I watch the sales progress week by week. If there's hardly any interest in 2 months, I move elsewhere.

I tried opening a full-sized store in January. The sim came up high on the search listings for the sort of items I planned to sell there, and seemed to have good traffic ratings. After 3 months, I closed the store. I hardly got any sales there, even with a L$1K ad and my store mentioned in ads paid for by the sim. I rarely saw anyone else in the sim, except for in the club, when it was having an event. So I cut my losses and closed that site.

Location is very important. If you're in a Victorian sim, you still probably will do poorly if you're selling high-tech toys. If you're in a sim that is mostly furries, then jewelry worn on Human ears won't sell as well, nor would prim skirts that conflict with wearing tails. Make sure the sort of people who go to that sim are the sort who buy what you sell. Look at the other merchants there. Are they similar items? Do you offer a competitive product?

Ask yourself this: If you hate a laggy location, why would a consumer think any different?

Personally I am on both sides of the equasion here as both a retailer and a landlord.

As a retailer I pick my spots carefully. Any excessive lag and I will not even think of renting, even if the spot is free. I also look for professional management. After I do pick a spot I give it 8 weeks. If it pays for itself, great! If its close to paying for itself and the landmark traffic is good, I will likely keep it as well.

I do take some spots outside of these rules that are small, and sometimes laggy in specialty areas, really more as an advertising endevour more thatn anything.

As a landlord I try to provide a place that I would rent in, so I have quite stringent rules regarding what I allow renters to do. I try to keep it as a balance and so far it has worked well, with a relatively lag free sim, and 100% occupancy since I started.

To me 'extremly high traffic' is a sign of campers, and is an inflation of the true traffic numbers, or is ALL the traffic.

Moderate traffic, WITHOUT camping devices (chairs, dance pads, window washers, gardeners....etc) and also without clubs and casinos I have found are my best bets. People are going there to shop, not to party or gamble or be zombies.

Simply put:

If your rent for a given period exceeds the amount of money you make from that location in the same period, it isn't worth it.

To a point. If you have a main store, to me the value of the people taking landmarks from the smaller stores and visiting the main store has value, because if you did not have that location, they wouldn't have necissarily shown up (and hopefully bought something).

I'm curious about how people feel about malls? Do they really do more business over a singe store??? Personally I hate them! In RL and SL...lol

When i am shopping I rarly go out to just look and see what is out there, I have a purpose and want something specific. So when I do a search for skins and the search brings up the word MALL and shows a picture of a mall, I don't even look at it, if the search brings up a store, and a picture of a single store, I will TP. Also, if I want skins, it really helps if the add in search is really promoting skins and not a huge list of things for sale...........I'm a very determined shopper, and hate having to waste time....lol, which is why the search feature is starting to really bug me.........but that is a whole nother thread....

The second I'm in a laggy place, my impatience runs out of control, and I TP my butt out of there...lol

If you never sell anything it just nothing more then display space.
I rented several displays in areas I hope to show my creations.
Issue is if there too many business around no one will see your stuff.
If its rent situation the owners for whatever reason can decide they don't want you there for simple things like island owner who decides he and she want a watersports area or they don't want any vistors to buy products other then there own.
Then there marketing issue, how do you get people to even find you within set up in SL.
Either way it cost money or you're going to make enemies spamming popular places with notecards.
It would be just easier to find at networked system or several.
I have been thinking about that instead of renting or using my prims on my land for shop space
Only people who have ever bought anything of mine were friends with few exceptions.
The real way to get sales is make lot of friends who care about you, your product.
Which can be challenge in itself.

There was a thread or two on this subject quite recently. For what its worth the question is oversimplified, IMHO. There are good malls and poor malls, and there are good single stores and poor ones.

For instance, I prefer a well-run, efficient, low lag mall over a poorly designed 8-acre sprawling single-creater laggy store. If I'm in the mood for idle shopping, a mall with a wide variety of products and creators appeals to me.

However, if all other factors were equal (and they seldom are) and I'm looking for something in particular, I tend to prefer a single-store.

-Atashi

Perhaps I am not typical, but If I show up and things are not rezzing ... I'm out of there.

I'd kill it, and let the mall owner know why - lag.

So many useful comments, so little time (I'm at work still). I'll jump in here for now.


I was very careful to choose a location on a sim that I *thought* catered to my primary audience (I'm being vague here on purpose, 'cause don't want to diss the mall owners, who are very nice).

The shopping centre is very attractive, consisting of a series of nicely designed little shops clustered together in a courtyard. I had been to the place myself a few times and figured it was too expensive for my budget, but asked anyway and was pleasantly suprised at the rental. Again, I thought the place would have foot traffic from a particular niche of shoppers, so that ads sending people to that location (rather than the store on my land) wouldn't be needed.

If two locations are identical in what they offer, what benefit do two classified ads offer? The only advantage of the second spot, to my mind, was the foot traffic. I had hoped to pick up sales from people who weren't necessarily looking for my product when they began shopping, but either did some impulse shopping or asked for a landmark.

Eventually, my plan is to open a main store with a much larger selection, in which case the satellite shop would help feed one particular audience to that store. But it doesn't seem to show any promise for supporting that future expansion since requests for LMs have been practically non-existent. Even without sales, an interest in the LMs would make this location worth developing.

Based on what I'm reading here, though, six weeks should be long enough to judge whether or not the location is going to work. Both the lack of sales and the lack of requests for landmarks tells me that I misjudged the effectiveness of that location.

Perhaps the problem is lag, which isn't likely to go away soon. Or the foot traffic is much lower than I had expected or the shoppers have no interest in my product (which is admittedly a very narrow niche). Either way, there doesn't seem much point in staying.

Thanks for the feedback everyone!

There are some definite advantages to "spreading out".

1: Protection from region failure. If you have a single store, and that sim crashes, lags out, or just plain goes away, you're out of business. Multiple sites can keep you available and selling. I once lost three sales locations in two weeks, due to factors I couldn't hope to control. Two of the sims got reformatted completely. My other 3 stores kept me in business.

2: Brand recognition. Quick... Who are you more likely to buy from? A merchant you only found in one odd location? Or one that you've seen in almost every place you go to shop? Most people will go to the one that has multiple locations, because it's a sign they have invested a lot of money and effort into being available. It's an indication of success. The one-shot store might be gone tomorrow. A merchant that is in 20 malls is likely to stick with it.

3: Diversify the audiance. Some people only go to certain areas to shop. Some people detest the mainland. Some love Asian things... Being present in a wide range of sim types makes you available to a wider market demographic. Maybe you're selling BDSM toys. There are a wide range of types that like that narrow niche market of product. Some are furries, some are Humans, some might shop in Gorean sims while others won't set foot in one... I'm an Asian-appearing Furry. A Kitsune, to be precise. But if I only sold stuff in Asian Furry sims, I'd miss a lot of people who would appreciate and buy my clothes, furniture, and other merchandise.

Good points, all. I will keep the concept of mutliple stores in my expansion plan, just start scouting for a different location.

So I think for now, my primary focus will be developing a main store, THEN worrying about other store locations.

Ceera just took the words right out of my mouth but to add...

I'm also wondering if you are in a location that markets to a particular client? One of your items is "Dyke in a box" (LOVE that btw - lol) so, maybe a location such as "The L Word in SL" would be a good place to sell? Or any of the other popular Lesbian/Bi themed locations? There are tons of them and most have a small mall or vendor areas.

Sol

*edit: Oh, wanted to add - I personally HATE shopping in the gi-normous malls. Not just the lag issue, but it's so overwhelming; all the colors and shapes and twirling things....argh! I much prefer to shop in stores that are stand alone and offer a main product (such as skins) and a few other items (clothing or whatever). My 2 cents.

Yes, that happens to be the particular line I am selling (or, not selling, in this context). If lag is not the only problem at my current location, then I greatly suspect that I selected an area more frequented by gay men than gay women. The great decor should have tipped me off to that risk.

Given a limited amount time in my day for working on SL, I've been focused on product development rather than marketing, so I haven't explored a lot of other promising locations. Arggh. I feel like I'm pulled in five different directions at once! Which is another "challenge" of launching a business. What pressing issue gets priority?

I've added a new line of Otokoyaku Avatars, which are a different market entirely from the ones for gay women. For that, I'll need to find store locations in Japanese-themed sims.

So again, I think I need to keep my focus on building the main store brand that will pull all of these seemingly different lines under one umbrella. Then I can spread out to smaller store fronts that will focus on a particular line but provide an LM to the main store.

Whew! None of this would be worth it if I didn't enjoy the work itself. I'm still in the red, and have no idea whether I'll even turn a L$ profit. But I'm having fun, which is my main motivation.

It is a long list indeed, but I'll try to summarize the salient points rather than upchuck my pain points in long-winded detail.

Technical errors came from not fully understanding the SL building tools and interface. Mistakes like not using the right shape template so that I was listed as the creator, or not setting the right permissions in a group of objects I was trying to bundle together. Not to mention learning the appropriate settings for a poster vendor to transfer a product to a buyer.

I struggled with presentation strategies -- how to transfer a wide range of objects to a person without drowning them in an onslaught of items. That involved some trial and error until I found the right balance in boxing some components and not others, then putting all of that into yet another box.

Marketing is another area rife with decisions I made that didn't work out. My L$50 classified ads work fine; the L$200 was a waste of money. And I'm still clawing my way up a steep creative curve for generating the marketing materials -- nicer signs, more dramatic photography, designing a larger store to give me room for more appealing displays. I still need to create some freebies, and there are some smaller accessories that I'd like to make so I'm not just selling a few high ticket items.

But the most fundamental "mistake" I've made is one I'm not willing to correct. My production approach is incredibly labor and L$ intensive.

Each of my shapes has a very detailed wardrobe, specific to that figure, and her own set of accessories like jewelry or tattoos or props. My newest line has two complete outfits, one of which is a costume. I also select a set of animations characteristic for each figure. I spend a lot of time with photography, creating a collection of ad shots, but also a set of 4-5 shots of the shape in different skins. So anyone who buys a Dyke-In-A-Box shape can see immediately how that shape would look in a skin by Robin Sojourner or Chip Midnight or a number of other leading skin designers who offer no-makeup or low-makeup skins. Then there are the styling notes, detailing where each accessory and piece of clothing was purchased.

All of this means each shape box comes with a large collection of landmarks and reference photo textures (hence the bundling issues). And the sales box itself is decorated on almost all sides with various photos of the purchased shape.

The end result is that each shape costs me about L$2000 in out-of-pocket expenses and at least a few weeks in development/marketing time. And I sell them for relatively moderate prices, because the shape market is VERY crowded and most of the really high-priced models ($1500 and upwards) are bundled with skin and other essential body parts which I don't offer.

NOT a business strategy that I would recommend, but the development is where I get the most fun. I don't want to just sell shapes for money; I want to create characters. And to create a character I need a detailed construction process. I love doing the photography, too, which I'm now seeing more as portrait photography rather than product photography. I'm not nearly as good as I'd like to be, but I'm getting better with every new shape.

It's going to take me a lot longer to recoup my costs, much less make any profit, than other shape makers. And my inventory offering grows very slowly indeed, further reducing my potential profit margin. But if I don't do it this way, there wouldn't be any point in doing it at all.

I have one location that is like that way to much lag

I was in the process of letting the rent run out to move however it also appears the owner of the mall is aware of the lag and just bought a sim as he was sharing with another mall. So I am moving to the new location and hoping the lag is better. He has put all kinds of rules in place to limit lag and am hoping that this will change things. I have sold some items while in the space but I know i would sell many more if the lag was not crippling. I went one weekend to add a couple of new items and could not due to the lag so I had to leave it was at that point that I had given the location enough time (3 weeks) to turn around lagwise.

If the mall owner does nothing about the lag then its time to leave in this case the mall owner spent about 2 weeks trying everything to reduce lag with no results and in the end decided to buy a sim so I since he is doing everything in his power to lower lag and I think a dedicated sim will be the cure then I of course I changed my mind.

Typicall though I find most mega malls aweful I tend to do go "strip" mall type places with only 10 or so stores instead of 50 or something like that because obviously there are less issues with lag in the smaller malls (err of course the rest of the sim has to be in decent shape lagwise as well )

That's one reason I'm so disappointed in the location. It's NOT a mall. It's a lovely little courtyard of shops in a very elegant sim build, and the lag was just as bad early this evening as it has been on previous visits.

I stood in the space I rent and the room rezzed first, but it took a long time for my handful of poster vendors to rezz. So for at least a full minute, it simply looked like a vacant room. A passerby would have no reason to think there was any reason to go in, much stand and wait.

Sigh.

Oh doh yes this happens to still my best selling stuff is at a main store with low lag as I take measure to keep lag low although its rising now some guy is selling dance floors on a lot next door..

I got lucky and found a great little gathering spot when I first started just because I was out site seeing and have been there for a long time now since before christmas actualy but it was a place with 4 or 5 stores. Its not elegant but its pleasant and fun and I even became a staff member of the place to help with the patrons who use the rest of the facilities. These places are best really. At the time I was on a small lot that was realy my home only 1k of land and it was full of all kinds of gadgets I was playing with so this place was my starting place. I found though that in order to do it right and have room to grow 8k of land was about a minimum. I'm still farting with it though I'm slow to build because like you I have other things happening so some building are still partly textured (namely my "house" at the back because I simply have not had time to get back to it) but its coming along. I still make satellite stores though it does seem to help a lot as far as being seen goes which is why I put one in a large mall. In my case I have not as of yet lost money on a mall rental I came close with one due to its over head but in the end I broke even and this time round I in fact am making money because I finished the set themed for that area. (I rented early worried that the place would fill up or something and didn't want to not get a space hehe)

Anyhow yeah the smaller areas are great if you can find one to match your theme.

A while ago I went out and set up a load of new locations, I ended up renting in about 20 different places. I learned quickly that I can't sell anything from malls, I was lucky if I got a single sale from each location so they just weren't paying for themselves.

I do, however, have vendors set up in a couple of bondage releated sims and sales there are great, even though none of my products are in anyway kinky. I guess it has somthing to do with those sims having such high traffic driven by people who actualy want to be there rather than campers etc. People seem to walk around the shopping areas in those places looking for intreresting things to buy.

My advice would be, regardless of what you're selling, go after the perverted money

Vale