Back in the 60s or 70s, opening a retail store may have been relatively simple. You would rent a storefront, open your business, and do it all in the span of maybe four to six weeks. Today, regulatory environments in larger cities like New York are delaying businesses from opening and are incurring exorbitant costs on merchants through fees and permits before stores even open their doors.
The truth is that mom n’ pop businesses are often run by one, two or even three individuals that barely have the time and resources to dedicate to navigating permitting and licensing processes. As a result, many of these small businesses incur fines once they’ve erected a non-compliant sign (or awning or roll down gate). Meanwhile, guess what kind of businesses can afford to navigate the permits and regulations, pay for professional architectural and design fees, and therefore continue to thrive in such markets? The thwarted national chain stores.
At a recent NYC council hearing, LOA Principal Larisa Ortiz testified “…What we need to do is help our small businesses remain competitive” If they can remain competitive, they might just be able to weather rent hikes. After all, when we really stop to think about the costs of operating a retail or restaurant business in a city like New York, rent is only one factor.
Think about the time and costs that go into sourcing products, managing inventory, staff and training, utility bills, liquor and business license fees – simple things that enable a store to flip its sign to say ‘Open for Business’. After all of that, there is still marketing. Before we can even begin to talk about online marketing (which is incredibly crucial to the survival of most types of retail and restaurants today as customers switch to omni-channel shopping), there is storefront marketing.
Storefront marketing quite simply refers to all the things you can do to your storefront that help draw the attention of potential customers on the street. This includes everything from your window displays to your signage, awnings, exterior lighting, outdoor racks and tables and chairs. Whether businesses like it or not, each element of a storefront reflects the store brand, the price point, and product offerings. Get one thing wrong and you may be turning away a potential customer who may have felt uncomfortable walking into a laundromat with no transparent windows or into a corner store that had expired products on display. You might say ‘Don’t judge a book by its cover’ but the truth is most customers are judging businesses by their storefronts.
So if we want to make sure our small businesses remain competitive, then shouldn’t we be making it easy and cheap for them to do good storefront marketing? Unfortunately, in most cities like New York, it’s not easy or cheap.
Virtually every other type of storefront marketing tactic requires a permit from a city agency. And when they don’t, merchants need to be acutely aware of the regulations to avoid incurring fines after installation. If we’re being honest, the whole process of enacting good storefront marketing tactics can be extremely prohibitive, especially for small businesses. In addition to hiring licensed engineers, sign hangers, designers, and contractors (of which there aren’t too many creative ones around), businesses also need to sometimes pay renewable annual permit/license fees.
Still not convinced that this whole affair is cost- and time-prohibitive?
Let’s take a look at very simple examples of non-national chain stores in NYC and let’s see how many of these good storefront marketing tactics required business owners to navigate and fund a permit, license, or petition:
Now imagine you’re a small business owner thinking of opening up a small café in your neighborhood. You’ve found a small vacant space to avoid paying exorbitant rents but now you’re buying equipment, furniture, product, and outfitting the interior of the store (because it was previously a barbershop), and paying for barista staff training, and then finally, ……storefront marketing (all of those basic things I’ve just highlighted above).
While the complaint against high rents may be loud, municipalities around the country also need to turn their attentions to the regulatory frameworks that place burdens on small businesses from day-to-day. At LOA, we believe that zoning and regulatory environments play a critical role in shaping vibrant and viable business districts. That’s why as part of our work, we often assess zoning, permitting, and regulations to ascertain impediments to innovative and sustainable businesses. As the Small Business Jobs Survival Act in NYC continues to unravel in city council, let’s also acknowledge the various other factors that impede business success and growth. In this rapidly changing retail climate, physical retail locations are now more than ever key marketing tools. They are physical manifestations of brands and lifestyles, and need to be relevant to the customers seeking unique experiences and products. Let’s help small businesses with their storefront marketing so they can effectively compete for foot traffic.