Seven Things to Consider When Opening a Second Retail Location


When a burgeoning business gets off the ground, the undertaking is both strenuous and exciting for all new retail owners.  The same can be said when the successful first location gears up to open a second.  Rappaport’s Director of Brokerage, Chris Pamboukian, has advised several local retailers through the leasing process, find their footing as a small business, and continue to prosper and expand.  As a former retailer himself, Chris understands what goes into such a feat and assists retailers any way he can.  With over 30 years of retail industry experience, here are a few things he says retail business owners should consider when opening a second location:

  1. Show Me the Money
    Before anything else, ensure your business is fully capitalized and generates enough revenue to sustain additional business. Until the financial wherewithal and investments for a second location are settled, a new space is a nonstarter and should not be on the table.
  2. Get Organized
    If your restaurant, service or retail store is profitable enough to consider expansion, Chris states the key to creating an equally successful second location is organization. From management to customer service, inventory to quality service and cleanliness (QSC), these pillars of the retail experience are easy to manage as an owner of one shop.  With two, delegation becomes the name of the game.  Trusting your management team is competent, committed and fulfilled is necessary to ensure a smooth-running operation as the owner loosens the grip on the wheel.
  3. Find Your Target
    Who is most likely to visit your establishment? Answering this question is imperative to identifying the business’s brand, the correct neighborhood to set up shop, where and how to market and more.  Recognizing customer demographics simplifies the choice of market: insert the business into the fold where the target consumers live, work or spend their free time.
  4. Fill a Void
    Understanding who your competitors are and where they are located could be the difference between success and failure in a new area. If the market is oversaturated with a certain concept, piling on another choice is futile as consumers will become torn between the options, thus splitting the revenue amongst the concepts and driving down sales overall.
  5. Create Spokes on a Wheel
    Chris says to view every new location and space as “spokes on a wheel”. With the flagship at its core, branch off from the original market just enough to avoid infringing on the core customer base, but remain close enough to easily travel between the two.  As the business grows, the spokes should continue until a full wheel is formed before shifting to a new market with different demographics and lack of brand recognition.
  6. Keep Your Ego in Check
    An owner of a thriving single retail store should be proud, especially considering only about half of all establishments survive past the five-year mark*.  This, however, can also be a fledgling retailer’s kryptonite.  Too often, fallaciously viewing a successful single location as a predictor of future prosperity translates to leases signed when the profit margins simply do not add up.  Business owners may opt for the flashier zip code or prettier storefront, but the exorbitant rental rates or build outs may cripple the entire operation.
  7. Stay True to Your Theme
    At the end of the day, the goal is to get customers through the door. If your initial concept had a specific atmosphere and build out, this is what customers come to expect and reinventing it could turn off loyal patrons and new clientele who anticipated an experience similar to the first place.  While creating new brands is potentially lucrative, it is quite a challenge for a local retailer who is still ironing out the business’s system and standards.  When opening your second location, best practice is to stick to what you know.


After following these tried and true guidelines, Chris urges retailers to remember this rule of thumb: life gets easier by the third location.  For additional information on the retail leasing process, how to open a second retail location and leasing opportunities, please contact Chris Pamboukian here.


*U.S. Small Business Administration 2018