Why Being a Local Retailer is So Tough

Are you hoping to one day to open up a boutique or store? Are you wondering whether it is a good idea and whether it will be a profitable business in the end?

Well, firstly, there is no such thing as a bad business idea, but every business’ success rate depends on the market in which it is placed.

Namibia has a low population density, which means that creating a business here is less competitive, but a lot more work when it comes to profitability.

So do you open your business to see if it works or do you rather not try at all? Commonly, giving up should not be an option, but doing your research is by far the most crucial part of opening a business.

Talk to people who have tried and find out why they failed, talk to people who still have their doors open. Find out all you can before you decide to take on the retail industry because it will let you in and swallow you whole if you don’t know what you are doing.

1. Your business cannot solely depend on the local market. The problem with depending on the Namibian market is the fact that it is not large enough to support the scope of business you are entering. When people want to compare local retail to all the exciting foreign entities, it simply does not make sense. Your boutique/store won’t make it because the Namibian market cannot sustain you, whereas stores like Edgars do not have to worry if their Namibian stores are not doing as well as they should because in their other markets, they might be doing better than expected. You cannot compete with them, so don’t.

2. If you are going to be in retail, especially in Namibia, you need to make sure that you either have a unique product. Selling your local customers what they find elsewhere for less will not keep you in business. Your profit margins must make sense. You can come with a great product for a higher price, making it luxury. Or sell more for a lower price, which would make it premium or mass market product. Quality is everything in this market and that has to correlate with your sales and still cover your cost price.

3. The people you bring into your business have the ability to tank it. If you are not able to manage your own business, make sure you allocate this responsibility to someone who is able to. The right management coupled with the right product and a workable market can send your profit margins soaring, so source your team wisely.

Remember, business is not easy, but it is not something that has not been done before. There are a few formulas and they work. All you have to do is adapt them to your business and your market.

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