What to do when your retail refurbishment costs more than planned
Whether you are upgrading your store’s look and feel or doing structural changes to layout; renovations and refurbishments are notoriously unpredictable. But if you want to stay on top of your game, they are necessary because when done the right way they increase value, attract customers and decrease long-term spend on maintenance. The important thing to keep in mind is to watch your bottom line like a hawk. Even then though, you run the risk of unforeseen expenses. So what can you do to manage your retail business renovation costs and what can be done if and when things get out of hand?
Maintenance costs VS. Refurbishment costs
Whether you are running a restaurant or clothing store, you are bound to find snags in your infrastructure: A scuff here, a lighting issue there, each of which needs to be dealt with. Maybe it feels okay at the time to put off what feels like a potentially expensive exercise. The problem with this is that holding back on general maintenance can land up costing you a lot with more serious refurbishments down the line. Nip these issues in the bud early and get smaller nips and tucks out of the way when you can.
Refurbishments must always add value
When considering your renovation or maintenance plans, there are three key things you should always consider:
- What does your customer want?
- How can you do this at minimal expense?
- What should your be spending your cash on now?
With these three things in mind, you will be in a good position to manage your costs and optimize your plans. The most important thing is to always have return on investment in your peripheral vision. Then plan for work to be done in under a few weeks, at a time of year where loss of trade is at a minimal.
So what happens if things go over budget?
Rest assured, if this is your worry, you won’t be the first or last entrepreneur to have this problem. Our advice is don’t try and dig yourself out of the problem alone. Cash in hand may be just the thing you need to put the refurbishment blues behind you. At Merchant Capital we encourage investment in necessary upgrades to your establishment because it ticks the box of being a growth enhancing activity. Here the cash flow from a Cash Advance will allow you to tweak plans on demand and fund unforeseen changes and delays, without it impinging on day-to-day planned running costs. Best of all, a Cash Advance is tailored to the retail industry as it will be paid back as a small percentage of future turnover via your card terminal. Meaning your operation can recover directly in line with turnover.
The bottom line
When it comes to refurbishments, its best to plan for the unpredictable. By keeping all these cardinal rules in mind, your retail business will remain updated, upgraded and upscale. So even if costs do land up higher than planned, you have options to mitigate risk. For more information on how to grow your retail business with funding for refurbishments and renovations, apply online by clicking the button below or contact our team on 011 217 2880 today.