Selecting the right business model is a pivotal decision. Whether you’re in retail, beauty, health, or hospitality, your choice between suite models and traditional brick-and-mortar locations can significantly impact your growth trajectory, customer experience, and operational efficiency.
Based on my extensive experience scaling business models, including the Waxxpot franchise system, here are the key factors business leaders across industries should consider when determining which model best aligns with their goals.
Flexibility and Growth
For businesses focused on rapid expansion or entering new markets, suite models provide unmatched flexibility. This model, which involves operating within a shared facility, allows businesses to scale quickly without the high overhead costs of a traditional storefront. It’s an excellent option for entrepreneurs looking to test new markets with less financial risk.
The ability to adapt and scale swiftly makes suite models particularly advantageous in dynamic industries where trends and customer preferences evolve rapidly. For any business focused on growth, this flexibility can offer an edge, making it easier to adjust as market conditions change. This proves challenging for brick-and-mortar locations as finding the ideal real estate for your business may take time. Additionally, if opting for a lease agreement, it may require legal experts and extensive time to reach fruition.
While suite models do prove beneficial for flexibility and growth, brick-and-mortar locations continue to supersede expectations and offer new growth benefits. This rise in popularity is fueling a switch in mentality in business leaders who traditionally focused on suite model locations. For example, CEO and Founder of Waxxpot, Daniel Sadd, is widely known for his success with Salon Lofts – a suite model that reinvigorated the beauty space. However, he now understands the complexities of such a model and what business factors indicate that a brick-and-mortar model will yield a stronger growth path. Thanks to his expertise, Waxxpot continues to achieve flexibility and growth with a robust leadership team, advance real estate support, and active and community-minded franchisees.
Brand Consistency and Customer Experience
If maintaining brand consistency and delivering a seamless customer experience are your top priorities, a brick-and-mortar location offers greater control. From the layout and design to how staff interact with customers, a traditional storefront allows you to manage every detail of your business’s environment, ensuring a unified brand experience.
This level of control is harder to achieve in suite models, where shared spaces may limit customization. For businesses that thrive on creating a premium or highly personalized customer journey, a brick-and-mortar setup offers a more direct route to crafting and sustaining that experience.
Initial Investment and Operating Costs
When considering financials, suite models typically offer a lower barrier to entry. With reduced initial investments and shared resources like reception areas or utilities, these models can make sense for entrepreneurs looking to minimize upfront costs. This can be particularly advantageous for startups or businesses with limited capital, as they focus on reducing financial risk in the early stages.
That said, while suite models may be more affordable initially, brick-and-mortar locations often offer long-term advantages in terms of revenue growth, customer retention, and upselling opportunities. Brick-and-mortar locations also provide additional future revenue thanks to the investment in the real estate. In the end, it’s important to consider and balance short-term savings with the potential for higher returns in the future.
Visibility and Market Presence
One of the key benefits of a brick-and-mortar location is increased visibility. A physical storefront in a high-traffic area can attract walk-in customers and help build a recognizable presence in the community. This visibility is invaluable for businesses aiming to strengthen their brand and attract a broader customer base.
In contrast, suite models tend to rely more on appointment-based or niche clientele. While this can work for certain business types, if market presence and foot traffic are central to your growth strategy, a traditional storefront might be the better choice.
Operational Control and Maintenance
Brick-and-mortar businesses provide full control over their space, from daily operations to maintenance and upgrades. This level of autonomy allows business owners to design their physical space to their exact specifications and maintain it according to their standards.
In contrast, suite models often involve shared responsibilities for maintenance and operations. While this can streamline management and reduce daily responsibilities, it also limits the control business owners have over their environment. If controlling the look and feel of your space is crucial, a traditional model may be a better fit.
No matter what industry you’re in, choosing the right business model comes down to understanding your priorities. Both suite models and brick-and-mortar locations have their benefits, but aligning the model with your long-term vision and business goals is essential.
By carefully weighing these factors and evaluating the right step for you, business owners can make informed decisions that set them up for long-term success in a space of their choosing.
Contributed by Mike Abramson, COO of Waxxpot
Suite stock image by wee dezign/Shutterstock
