Renovating in a Recession
October 21, 2009 - 6:33am

For many retailers, plans to expand or even just spruce up the showroom have been placed on hold indefinitely due to tough times. But some stores are differentiating themselves by investing in their showrooms’ appearance with the hopes of engaging customers and positioning themselves for the upswing.

During the height of the building boom in Florida, business was thriving for the Fort Myers-based Brothers Lighting & Fan Gallery, which specialized in outfitting new construction homes. Back in 2005, the business had outgrown its 4,000-square-foot showroom and expansion was inevitable. Co-owners and brothers Charles and Andy Bebber purchased a sprawling plot of land on a high-traffic road a couple of miles away. By the time the new, 16,000-square foot, two-story showroom (pictured) — with its elegant atrium that displays oversized chandeliers and fixtures and a grand staircase — opened its doors in November 2008, the present recession had already begun.

It was too late to lament the timing, says Charles Bebber. Although they have not been able to “use the facility to its full potential,” the brothers still see the long-term value of their investment. “The new place has that ‘wow’ factor,” he says. “We get a lot of business through word of mouth because we did a two-story building in Florida, which is very unusual, and we put in a lot of interesting things like decorative trim and designer accents. Customers who had visited us at the other location were amazed at what we did.”

To offset the increased overhead costs, the showroom has had to stock more of its “to-go-items” that they know will sell fast and have cut back on stocking their larger fixtures that are less likely to move in this economy. They’ve also focused on increasing sales by training salespeople to advise customers on complementary products with every purchase.

The fact that they have grown their business when others are folding left and right bodes well for the future, says Bebber. “We’ve had a number of competitors close. Just by maintaining existence we’ve gained market share.”

Foothills Lighting & Supply in Denver expanded through two acquisitions in 2007 and 2008, but is “holding tight for now,” says Showroom Manager Don Peterson.

While Peterson says it’s always good business to look for opportunities, they are channeling their energies internally. “We are in a constant state of renovation,” he says. “We have a large base of repeat customers and they need to see something different each time they come in. If my store is different each time they return, they will not have the need to see what my competition has to offer.”

For customers, appearance matters, says Peterson. “If a company is healthy, or at least appears healthy, [customers] are more likely to buy from them.”

In Florida, home to many retirees who saw their security blankets vanish before their eyes, many businesses have been hit hard. Jinkie Bays, owner and President of A Shade Above in Melbourne, FL, has been much more strategic about the merchandise she buys and has marked down costs considerably.

In August, she started renovating her showroom one room at a time, an ongoing process that includes repainting the inside, changing the flooring and rearranging displays so when their customer traffic picks up again, a fresh new look will greet shoppers.

For some stores, such as A&A Light Fixtures in Sacramento, CA, money for remodeling is just not there: “Ideas, yes; working capital, no,” says owner Gary Vian.

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