Insights from our subject matter experts.
It’s no secret that retailers face a constant balancing act— keep sales high and costs low. Many brands underestimate the power of strategic renovations in addressing this ongoing challenge. Even in today’s digital world, a strong physical presence remains crucial. According to the National Retail Federation (NRF), 80% of all shopping still happens in stores. While a store renovation involves an investment, the potential rewards can far outweigh the cost.
Increase Revenue — the obvious goal of any remodel. Store renovations hold the power to attract new customers, keep them browsing longer, and keep them coming back. Even simple improvements like upgraded lighting are proven to increase the amount of time customers browse, leading to larger ticket amounts. In our experience, we’ve seen store renovations produce sales increases of up to 50%. However, increased revenue as a result of renovation is variable and inconsistent. Because of this uncertainly, these other hidden factors must also be considered to justify the capital investment.
But the true return on investment (ROI) of any renovation isn’t only about a top-line revenue increase. Renovations provide other benefits that, while less obvious, significantly impact a business’s bottom line.
Think Beyond Aesthetics.
Look past the cosmetic appeal of a remodel. Strategic renovations deliver lasting benefits that extend far beyond aesthetics. The true power of a well-planned renovation comes in the form of increased sales, smoother operations, a stronger brand identity, and a more satisfied team. These improvements all contribute to the success and longevity of your business.
Bottom Line Benefits Driving Retail Success
1. Boosted Operational Efficiency.
It’s not just about what you see, it’s about what works better. Renovations done right are a double win for your business, providing both cost savings and optimized workflows. Reports from the U.S. Department of Energy suggest that strategic upgrades in the retail, food service, and grocery sectors can lead to energy savings of 15-30%, depending on the specific measures implemented.
Alongside these savings, well-designed layouts can significantly boost employee productivity by streamlining their workflow. Improved traffic flow, optimized product placement, and dedicated zones for tasks like order fulfillment can minimize wasted steps and time spent searching for items. This translates to a happier, more efficient workforce, ultimately contributing to your bottom line.
*image courtesy of Walmart
2. Enhanced Customer Experience.
Customer experience is often the battleground for brands vying for differentiation. There’s much at stake when you consider that one-third of your business will shop elsewhere after just one bad experience. On the other hand, customers who rate companies with a high customer experience score spend 140% more (SuperOffice). Modern, well-designed spaces elevate the customer experience and reflect a customer-centric brand.
3. Brand Loyalty.
Customer experience extends further than the single store. When a customer has a pleasant experience at one location, they are more likely to anticipate (and seek out) the same positive experience at one of your other stores. Renovations offer an opportunity to capitalize on this compounding effect of positive experiences across your portfolio. According to a report by McKinsey, a 5% increase in customer loyalty can lead to a profit increase of 25-95%.
4. Competitive Edge.
Renovations offer a strategic opportunity to keep your brand relevant. By integrating new automations and technologies like self-service kiosks, frictionless technology exits, and smart meeting rooms, you can elevate the customer experience while simultaneously reducing staffing needs and streamlining operations. These are improvements that lead to a significant reduction in costs.
5. Improved Employee Retention.
Happy employees stay put! Well-designed workspaces can lead to higher employee satisfaction, translating to lower turnover rates and significant cost savings on recruitment and training. Additionally, studies suggest that satisfied employees can be up to 12% more productive, while unsatisfied workers can be significantly less productive. Creating positive workplace environments not only improves employee morale but also contribute to the company’s bottom line.
Ready to take your brand to the next level with a renovation program? Learn more about how you can get your pipeline of projects completed 25% faster and avoid costly unwanted delays in our recent article, Another Grand Opening Delay. Read it here!
