You’re all set to start a brick-and-mortar store in NYC, with a space you’ve picked out. The rent for your little store comes at a steep price of $50,000 per year, at $100 per square foot. And that’s not all — you still need to factor in the costs of insurance, utilities, and internet before you can reach profitability.
As you stroll through the streets of NYC, peeking into shop windows for inspiration, you can’t help but notice something that catches your eye — framing shops. These establishments resemble small art galleries, showcasing framed art in their windows, albeit with fewer visitors.
You begin to wonder how these stores make money, how much they can earn, and why there are so many of them. Let’s delve into the business of frame stores and explore their revenue potential.
Margins and Money:
In the retail custom framing industry, it’s common practice to apply a minimum markup ranging from 30% to 40% over the wholesale costs of materials and labor. However, for projects involving rare and exotic woods, the prices can be significantly higher. Many framing shops adopt a pricing strategy known as the one-time double cost, where the price for custom work is set at twice the total cost of labor and materials. The ability to command higher prices largely depends on the specific clientele served. Collectors with valuable artworks are often willing to pay several hundred dollars or more to have their paintings professionally framed, even if the framing cost exceeds the original artwork’s price by a significant margin.
Ongoing Expenses:
To maintain your frame store, you’ll need to consider the following ongoing expenses:
· Rent
· Utilities
· Marketing campaigns
· Home delivery of flyers
· Flyers with discount offers
· Door-to-door distribution
· Targeting fine houses in specific areas
· Cost of printing flyers
· Cost of hand delivery to houses
Revenue Potential:
Let’s crunch some numbers to see how you can break even on your yearly cost of $50,000. Framing is not a cheap service, with lower-end frames starting at $50 and higher-end options going up to $400. Let’s use $100 as our baseline.
To cover your expenses, you would need to generate approximately $136 per day. Assuming your margin on a frame job is 70%, you would need to sell around 2 lower-end frames per day to break even. It’s not a remarkable figure, and if you can upsell higher-end frames (which require the same amount of work to cut and assemble), it becomes more feasible. However, even selling just 1 frame per day, the store’s situation doesn’t make it a lucrative business, unless you can establish an online presence and diversify your offerings with additional products like printing services and marked-up delivery.
Why Are There So Many?
Running a frame shop comes with relatively low overhead costs. You only need minimal staff (and training) to operate one. With an empty space, some racks, and wall hangers, you’re good to go. The most critical skills required to run this business lie in framing, marketing, and sales. With enough entrepreneurial spirit, it’s possible to get started. Add a Stripe terminal, and most of the operational tools are in place. The amount of tech needed to run this is pretty low even if you add printing and delivery services.
Overall, starting a frame store in NYC presents its challenges, but with the right approach, creativity, and diversification of services, it can become a viable venture if your shop can get a lot of free foot traffic advertising.
Written by: VimalV5Final
Read more here
