Transitioning from Partnered Ski Boot Alignment Business to Stand-Alone Business (Adding Pedorthic and Retail to Scope of Service)
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1 Transitioning from Partnered Ski Boot Alignment Business to Stand-Alone Business (Adding Pedorthic and Retail to Scope of Service) INTE 6750 October 15, 2011 Introduction Boot Fixation is a ski boot alignment shop in Breckenridge, Colorado that has been in business for 15 years. Boot Fixation offers high-level service that optimizes ski control through the modification of ski boots. Modifications include a 100-point skier evaluation, ski boot canting, internal canting and sole planing. Boot Fixation has a loyal and deep client base with a nearly 80% return rate. The shop is owned and operated by Jeff Bergeron. Jeff hires employees on an as-needed basis to give fast and quality service in the busy winter months. I am Jeff s wife and co-owner of Boot Fixation. Current Situation Boot Fixation has almost always been located within an existing ski shop. The advantages of being within another shop to Boot Fixation are: 1. Boot Fixation has not had to carry retail products carried by the ski shop: Ski boots Outerwear Accessories 2. Space Not having to carry retail products, Boot Fixation can operate in a small space ( square feet) The small space of Boot Fixation appeals to ski shops that have unused floor space where Boot Fixation can operate and draw in additional clientele. Boot Fixation has rarely had to pay rent, as both Boot Fixation and the ski shop agree on the mutual advantages of the partnership. There is a significant off-season to the ski industry and partnering with another shop rent-free is an advantage to Boot Fixation s expenses during the spring and summer months 3. Being within a larger shop allows Boot Fixation to find and operate in busy foot traffic areas. While clients wait for their products to be fabricated they can shop, eat and enjoy Main Street, Breckenridge, Colorado A large ski shop, especially one that is well established, is a landmark and easy for first-time visitors to find
2 Opportunity The three main advantages of partnering with another ski shop also offer opportunities to Boot Fixation if Boot Fixation chooses to separate and become a stand-alone business. 1. Retail In the last five years, Boot Fixation has averaged sales of $50,000 - $60,000 in ski boot sales for the retail partner shop. There is an opportunity for Boot Fixation to retain that revenue instead. Even a fraction of those sales would be a significant boost in annual income. 2. Space Boot Fixation does not need a large space for operation. Rent is manageable at an estimated cost of $7,000 - $12,000 annually. Minimal retail sales can more than make up this expense. Boot Fixation would not be tied to the reputation of an existing shop, the owners or employees. 3. Most of Boot Fixation s clients drive to the area for their appointments with Jeff. Prime retail location is not important to them and many would rather avoid the tourist traffic and come directly to Boot Fixation for their boot work. Purpose The purpose of this project is to explore the advantages and challenges that exist for Boot Fixation as the owner decides whether or not to move from a partnership business to a standalone business: Retail Space Client education Planned Intervention Three aspects of the change require analysis, 1) the cost of buying retail goods and displaying those goods, 2) finding affordable rent then arranging the physical shop space to accommodate retail and client services, 3) finding an accessible location that is easy for clients to find and 4) teaching clients about the location and availability of new retail goods. The way clients perceive the change is going to be as critical as the physical changes themselves. Jeff will examine each of the three steps above to ensure the smoothest transitions for everyone involved. (Danes, 2008) Retail Goods Jeff will investigate the cost of carrying a small line of the products that have been shown to be high quality and popular with clients. Jeff investigates all seasonal product updates at trade shows throughout the year and by reading trade magazines and hiring equipment testers. Jeff has found an interested investor who will back the cost up to $5,000 toward the first year s inventory. 2
3 Retail Timeframe Action Date Goal Create list of retail goods September 5, 2011 Research and decide which products to carry Create spreadsheet of Create concise list of goods September 12, 2011 cost of goods and cost Present investor with Write an agreement for first September 19, 2011 contract presentation to the investor Space Jeff has been looking in both Denver and in Summit County for retail rental space. Over the past decade he has built relationships with several property owners in Summit County. Recently he was contacted by a property owner on Airport Road in Breckenridge who offered rent at $675/month plus $80/month in utilities. This is the same location Jeff occupied in 2004 when he paid $575/month. Jeff will explore comparable rental spaces, cost and contract requirements. Timeframe: September 10, 2011 The timeframes are a guide rather than a rule because other people are involved, such as the investor and clients. Jeff will adjust the schedule as needed to collaborate with the necessary entities. The relationship is more important than the schedule as long as decisions are being made that keep the process moving forward and moving toward success. Jeff has worked both on and off the visitor-laden path in Breckenridge and Frisco in Summit County. He has seen advantages and disadvantages to both. As a small business operator, cost will determine that he open his shop off Main Street, most likely within 2-5 miles of downtown Breckenridge. While Jeff is exploring rental spaces, he will consider the implications of location, traffic to and from the location and distance to town. Timeframe: September 10, 2011 Client Education Jeff will update clients via , phone and Facebook about the new location and about the expansion into retail as soon as the lease is signed. Jeff s intention will be to let clients know what is right with the change. A positive message will help create the proper environment for clients moving forward. (Rutledge, 1998) Evaluation Plan Success will be measured in five ways: 1) client retention rate 2) new client visits 3) retail sales 4) rent cost 5) rental location 3
4 Research will be deemed a success once a plan is formed as far as retail items and cost, rent expense and location. After deciding on these three factors, the success will be determined by operations, the number of clients seen and how much retail goods are sold. If Boot Fixation can make more in retail sales than it spends on rent, that will be a successful retail operation for year/season 1 (winter of ). This success measure combines the issue of retail and of space discussed in the introduction. success will be measured by client reaction. The first challenge will be to let existing and new clients know that the location has changed then provide simple directions to the location. The second challenge will be the flow of clients with the space and establishing the entrance, waiting area, evaluation area, fabrication area, payment area and retail area. Success will be determined by client opinion and feedback (Braverman, unknown). Expected Findings Topic Retail product cost Rental space cost convenience Expected Findings Jeff will find a location due to the real estate downturn in Summit County. Jeff will be able to stock a limited and exclusive number of boots and ski accessories with the investor s contribution. Rental cost will be within budget (under $1,000/month). options will be made available again due to the real estate downturn in Summit County. Ethical/Stakeholder Impacts Several entities will be affected by Boot Fixation s physical move and retail sales addition. Clients Clients will need to have detailed direction to find the new location Clients are expected to enjoy the convenience of retail within the new location Clients are expected to be minimally impacted by Boot Fixation s move out of town center Competitive Retail Shops All of the equipment Jeff sold to clients in the past was a benefit to the bottom line of the shop he partnered with as well as with nearby retail locations. He was treated fairly and shop owners welcomed him and his business. Boot Fixation will benefit from a small but top notch retail selection and existing retail businesses will still serve as suppliers of items beyond Boot Fixation s inventory. 4
5 Jeff Bergeron Boot Fixation has always prided itself on its professional image both with staff and with shop design. Opening a new shop means that to maintain that professional image, Jeff will want to design the interior to be industrial, chic and well-organized. He has a client who has offered his retail design services in exchange for ski boot alignment work. Jeff, as the owner, will be solely responsible for moving into the space, arranging the proper set-up of equipment and retail inventory, staffing and overall atmosphere. In the past the main shop with which Boot Fixation partnered, was responsible for maintaining the quality of the initial customer interaction. Sometimes it was expertly executed but more often was not taken seriously. This new role of Jeff will be new, time-consuming but also welcome. It will be important for Jeff to take the time to see how the change is affecting him as the sole owner and operator as well. (DeMaio, 2009) Current Status This project began with two options, Boot Fixation setting up shop inside an existing retail shop and Boot Fixation becoming a stand-alone shop. A third opportunity of contracted employment was offered by another party. I will add that information to the remainder of this report. Current status of the project is shown in the following table. Shaded areas are complete or not applicable. Action Date Goal Status Create list of retail goods September 5, 2011 Research and decide which products to carry. Complete Create spreadsheet of cost of goods September 12, 2011 Create concise list of goods and cost. n/a Present investor with contract September 19, 2011 Write an agreement for first presentation to the investor. n/a Educational opportunity 1: announce new shop/details to current clients Educational opportunity 2: announce new shop/details to new clients October 1, 2011 October 15, 2011 Create new Facebook page; invite current friends to new page; send s to best clients. Article in local newspaper the Summit Daily News; offer incentive for visiting that can be forwarded through Facebook. In progress In progress Move into and set up shop November 1, 2011 Arrange shop in most efficient, appealing way. Plans in progress 5
6 Actual Findings Compared to Expected Findings Topic Expected Findings Actual Findings Jeff will find a location due to the real estate downturn in Summit County. Jeff found several locations that fit his expectations. He chose a shop on Main Street that would accommodate his boot service and retail goods. Retail product cost Rental space cost convenience Jeff will be able to stock a limited and exclusive number of boots and ski accessories with the investor s contribution. Rental cost will be within budget (under $1,000/month). options will be made available again due to the real estate downturn in Summit County. Jeff made a list of the retail goods he wanted to carry. He contacted an existing retail shop in Dumont that wanted to provide goods on consignment with him. He began preparing a cost sheet for retail, laying out the shop and hired a retail design expert. Cost was well within budget for the space. The space had adequate parking, visibility from Main Street and was easy to find. Change in Options On September 9, one day before signing the lease for the Main Street location, Vail Resorts (VR) called Jeff. They purchased the shop he used to work from and wanted him to come back. This brought up a third option contracted service. Jeff will contract with VR. Expected results: Concern Expected Result Main Street location, same building Jeff has worked in for the last 6 years. Retail product cost VR will fully stock their store Rental space cost n/a convenience The space is convenient and familiar to Jeff s current clients. 6
7 Educating Clients As soon as Summit County got the first snow of the season in September, clients started calling Jeff for appointments. Current Communication The current communication strategy is to: Phone/ the best clients about the situation and location Spread news and upside of VR partnership Let them know he is in the same retail space on Main Street Set up a new business Facebook page and invite all friends to join and Like the page Future Communication Merrill s First Principle of Learning fits into this business plan as a way to frame communication to clients. Merrill suggested that learning is most effective when the learning product is problem-centered and involves the learner in four ways: 4. Activation determine where the learner is with the information. 5. Demonstration show rather than only tell. 6. Application use knowledge to solve problems. 7. Integration use new skills in everyday life and problem-solving. (Merrill, 2002) Boot Fixation s current situation can be communicated using this strategy as a framework. Step Format Description Activation Assume that the learner needs a summary of location and services provided by Boot Fixation This assumption will cover the issues of location and service for all clients, existing or new. Demonstration Application and Integration Website: Map Directions from I-70 Directions from C-470 Description of services How to prepare for appointment Facebook: Develop business page Weekly posts of new products, service reminder, inviting current and new clients in Referrals demonstrate the integration phase. 7 Visually letting clients know the location, directions and new layout of the shop will help them learn and integrate the information. Existing clients will be able to find the shop, but it will look different this year. Preparing them in advance will make them more comfortable. When clients refer people to Boot Fixation, the client has demonstrated that they apply their knowledge from their experiences and think of Boot Fixation as the solution to a problem.
8 Conclusion To date, Jeff has reached approximately 75% of his best clients with the news. Jeff has mostly used and his personal Facebook page to communicate. The ski community likes to be involved in upcoming ski trends, informed about the latest equipment and share on-hill experiences. Facebook posts and s have been effective tools. The biggest lesson for me in this process is to understand that when I plan for change and list options, I need to stay open to even more possibilities. This time, the actions necessary to communicate the changes in Boot Fixation did not change much but the end result is completely different than what Jeff and I had expected. Jeff will focus on a continuing education campaign for his clients. Being involved with VR will present many opportunities in advertising, expanded retail and connections to the other mountains VR owns and operates. The partnership will also have its challenges such as following corporate standards of operation, fitting the business inside another business and working out any conflicts. It is important to Jeff that clients understand that he is still an independent contractor with his own, proven systems. Communicating for a small business is following trends similar to education. Clients and learners want information fast and at their convenience (Johnson, Smith, Willis, Levine & Haywood, 2011). I expect that this client/learner expectation will offer many communication opportunities for Boot Fixation that will contribute to the business success. 8
9 References Braverman, M. (n.d.). Page 2. In Planning for "Change Management" (or: How to Waste Your Effort and Your Money With the Best of Intentions) ( [Online article]. Retrieved from Danes, S. (2008). Factors Affecting People's Response to Change: Loss, Opportunity and Resilience [Online article]. Retrieved from Regents of the University of Minnesota website: DeMaio, S. (2009, June 16). The Right Way to Take on a New Responsibility [Web log post]. Retrieved from HBR Blog Network: Johnson, L., Smith, R., Willis, H., Levine, A., and Haywood, K., (2011). The 2011 Horizon Report.Austin, Texas: The New Media Consortium. Merrill, M. D. (2000, October 28). First principles of Instruction [Abstract]. In C. Briggs (Ed.), Association for Educational Communications and Technology. Retrieved from Rutledge, M. (Ed.). (1998). Ideas for Leaders, a Periodic Report, 1(5). Retrieved f rom 9
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