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opening next door to competitor? Ethics v/s food on the table

toucan_graphics

toucan_graphics

New Member
As I research locations to open my first store front location I found one interesting property for low rent, perfect location, perfect for my needs.... except for the other sign shop nearly right next door.

The question is this: Do I take advantage of the low overhead and open my shop near the other guy? Given my expanding customer base and the extremely low overhead I could easily turn a profit almost immediately and I could maintain a significant competitive advantage over the other guy. Should I move forward or should I keep looking for a different "perfect location"? On one hand, business is business and can be cut-throat, but also, that other sign shop owner is trying to feed his family just like me.

Your thoughts?

Thanks
 
niksagkram

niksagkram

New Member
We are in a city of 80,000. We moved to our present location 10 years ago. Two years later a competitor moved in on the next block. Two years after that another sign shop moved in a block away in the other direction. All three of us are still here, mainly because we had a strong client base, and specialize in different things, though, of course, we do many of the same things. So it is possible to work in close proximity.

We also have two more sign shops in the same industrial sub-division, and they seem to be doing fine too.

Maybe speak with your competitor and let them know your intentions. Maybe a good relationship can benefit both of you. Just don't start a price war..... everybody gets hurt then.

JMHO. :smile:

Mark
 
niksagkram

niksagkram

New Member
Wow.... just looked up Mocksville, NC, and you only have about 5000 residents? I might re-think my first reply. :omg:

Do you have a lot of commercial business in your area?
 
Stanton

Stanton

New Member
Second thought, in 35 years, only 50 walk in customers.

I have no experience in retail signs.

carry on.
 
Dave Sears

Dave Sears

New Member
If it is a great location, I would take it. The fact that is so close to another shop would make things interesting but ultimately people buy from people they like, not because of the location. Only caveat being if your new neighbor is a likeable, knowledgeable, sign person they might steal your accounts.
 
S

StopSignGraphics

New Member
I wouldn't do it. Too easy to get prices from the competition.

You might as well arrange meetings in the parking lot with the customer and the competition and see who willing to do it for less.
 
iSign

iSign

New Member
I could throw a rock to 3 other sign companies from where I've been for 18 years... & we've all been here all 18 years, except one guy... but there was someone else there when he wasn't...
 
toucan_graphics

toucan_graphics

New Member
The location is just outside of Winston-Salem NC with a heavy commercial customer base. I don't know the owner, but he specializes in channel letter and fabrication type stuff, with a some highway billboard work, which I don't touch, so it might be mutually beneficial.

I suppose a meet and greet is in order to establish what the atmosphere is like. Would they be welcome to a smaller shop moving into the neighborhood or would they just pee in my Cornflakes whenever they had the chance?
 
phototec

phototec

New Member
toucan_graphics said:
The location is just outside of Winston-Salem NC with a heavy commercial customer base. I don't know the owner, but he specializes in channel letter and fabrication type stuff, with a some highway billboard work, which I don't touch, so it might be mutually beneficial.

I suppose a meet and greet is in order to establish what the atmosphere is like. Would they be welcome to a smaller shop moving into the neighborhood or would they just pee in my Cornflakes whenever they had the chance?
Click to expand...

Well, if he's not your brother-in-law or family, then he is competition, (look up the definition), so I don't think he will be happy to have you right next door, as I would NOT want to be next door to him either.

Most every shop I know started small and has grown, and offered all kinds of signs, many offer channel letters even if they have too outsource the fabrication.

It's funny that you say, "you can be cut-throat", well don't forget that can go both ways, as soon as you pull that stunt, he will do the same, and if he is a bigger shop, and been there longer and is established, I'm afraid you will be the looser in the end.

So, you asked the question, and you may NOT like the answer, but I'm pretty sure I'm older than you and made many more mistakes in life, so with that wisdom behind me, I would look for another location even if I had to pay a little more, then I know for sure there would be NO bidding war done the road, and I would sleep better from now on....

One thing you'll learn in life, piece of mind is actually worth $, IMO....

Good Luck on whatever you decide to do!
 
P

player

New Member
Conversely, it could go well for you. Ever notice how a McDonald's opens and it is not long until other restaurants open up around it? You should do OK. Find out what he makes, what products you compete on, and know what he charges. You will get some of his traffic asking for prices. Know his price and come in slightly less. Referring business you don't want his way could also lead to a good relationship. The Stanton Principle.
 
Dovette

Dovette

New Member
niksagkram said:
We are in a city of 80,000. We moved to our present location 10 years ago. Two years later a competitor moved in on the next block. Two years after that another sign shop moved in a block away in the other direction. All three of us are still here, mainly because we had a strong client base, and specialize in different things, though, of course, we do many of the same things. So it is possible to work in close proximity.

We also have two more sign shops in the same industrial sub-division, and they seem to be doing fine too.

Maybe speak with your competitor and let them know your intentions. Maybe a good relationship can benefit both of you. Just don't start a price war..... everybody gets hurt then.

JMHO. :smile:

Mark
Click to expand...
:goodpost:
 
Marlene

Marlene

New Member
we moved into our current location in 1996. since then we had another shop move in and I can see them from my window they are so close. another one moved in just down the street. we aren't a retail shop but we still do get people doing the circuit of all three shops when price shopping. all we can do is offer what we do, our services and our reputation. if you are a retail type shop, it doesn't sound like a great idea as people will shop around and that could be a headache for you
 
Rick

Rick

Certified Enneadecagon Designer
Having just left your Facebook page and site...
Unless this shop has really crappy design work, don't see
any advantage you might have over an established shop
except maybe price. I think if the shop has some skill, you might
end up being the loser here... based on your site and facebook page
you are only offering the basic of sign/ad services.
 
d fleming

d fleming

New Member
I wouldn't do it. I wouldn't appreciate anyone doing it to me. Especially the landlord. Just the way I'm wired. There's plenty of space even a block away and we can help one another, but right next door? No.
 
C

Chriswagner92

New Member
If done right I think you can have fun with it, Think audi vs bmw billboard war. If you have different services, even a few, you can create a symbiotic relationship with the existing business and make everyone money
 
Techman

Techman

New Member
Price is your #1 competitive advantage????
I'd say, "your gonna lose".
Click to expand...


100% correct.
Price is never an advantage for the small shop. The economies of scale law cannot apply on short orders.

As for right next door? Go over and talk to the guy. See what he offers. IF it is different then all will be fine. If it is identical then move on. I have several shops within blocks of me. All are doing well. Each does something different
 
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