Leaving the Nest

When is the right time to leave home for a commercial embroidery location?
June 9, 2008

By Steven Batts

Working from a home-based location has definite advantages. Low overhead, control over your own schedule and a relaxed atmosphere are hard to beat. There are times, however, when leaving the comfort of home and expanding to a commercial location it make sense.

By their nature, certain niches of embroidery shops have to be in a location other than residential to begin with. It's nearly impossible and impractical to try a retail set-up at home. Retail operations, with the exception of Web-based businesses, belong in malls and retail centers where there is high foot traffic. Large contract operations require a lot of space and are generally set in warehouses and business parks so large trucks can get in and out easily.

Most home-based shops fall somewhere between those two ends of the spectrum. They may do small onesie, twosie orders, dozen piece orders or even orders of a couple hundred pieces. This is not indicative of their being home-based, but rather typical of the business mix of custom embroidery shops.

Moving Choices
So when does it make sense, as the owner of a home-based shop, to make the move to a commercial or retail location? That really depends on the individual situation, but usually it is for one of two reasons: The business has grown too big for the house or you want the business to grow bigger than the house.

The reason you want to move may determine the type of property you look for. If it's simply a matter of outgrowing the house, you'll probably be looking for something less expensive but with adequate room like a business park setting. You would have a small office in the front and a small warehouse in the back.

In this situation, the amount of increased exposure to the public is not a factor. You already have the business, and you're just looking for room to expand. Of course, you should factor in all the costs associated with operating from a separate facility before you make the move. Set up your pricing structure beforehand as if you were working out of a commercial location. This way, it's not a shock to the budget when the time to move comes.

If you're moving out to try to increase the business, you'll most likely be looking for a place with more exposure. If not a retail setting, you'll at least want to look for something with high visibility to attract customers. The main factor to weigh in this situation is whether the cost associated with being at a commercial location is more than offset by the increased revenue. Many times it will, but if it isn't, then why bother moving?

Not all of the costs are simply rent and utilities. There is additional insurance, store fixtures, etc. Also, there may be the need to hire additional help to man the store when you're not there. All of these factors must be considered when making the move.

Other Options
There is a limit to how large the business can grow in the typical home-based setting. For some people, that comes quicker than others. If you aren't careful, as the business grows, it can eventually take over the whole house. Once it starts to significantly disrupt normal family life, it's time to look at other options.

Being the tight wad that I am, the "other options" I looked at first was a Dutch barn in my backyard. So far, that has worked for me. But now, as I have added equipment, that arrangement is even getting a little tight. Fortunately, I still have plenty of space on my land, and I'm thinking down the road a garage would look really nice in the side yard.

That isn't a good option for everyone. To grow, you need space and sometimes exposure.
A good commercial location can give you that. Just don't forget the three laws of real estate when you move. Location, location and location.

Steven Batts, a 14-year veteran of the embroidery industry, is a regular speaker at the Imprinted Sportswear Shows. He owns Righteous Threads Embroidery, Greensboro, N.C., which offers digitizing, embroidery, machine maintenance and repair, and consulting. Call him at (336) 379-9380, e-mail righteousthreads@gmail.com or hear him speak at ISS Schaumburg in August on the following topics:

•    Conquering Caps: Tips and Techniques for Embroidering Conventional and Specialty Caps
•    Embroidery Essentials: Backings, Needles and Threads
•    Embroidery Fixes & Garment-saving Repairs
•    How to Create Special Embroidery Effects

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