For any small business retailer, the shop fit-out is one of the most significant capital expenditures you’ll face. It’s expensive, and the hard truth is that a reasonable return on that investment is rarely achieved in the world of local small business.
We often fall into the “monument” trap. We’ve seen many small business owners commission a shop fit they are immensely proud of: a beautiful, polished monument to themselves, one that simply doesn’t deliver the necessary financial return to the business.
We are reminded of a franchise business in our channel where they pushed a new franchisee into a $250K+ shopfit that did nothing for sales and was not paid off before the business closed. What a waste.
We must remember a fundamental misalignment of incentives: A shopfitter wants to profit from their work on the project. The retailer needs to profit from the space over many years. Their needs are not aligned.
We often think a shopfitter’s recommendations would be quite different if they were paid a commission on sales generated by the new fit-out over the next several years.
A Case for Frugality and Longevity
Years ago, I opened a shop in a major shopping centre. The lease required a substantial, expensive fit-out update five years in, at the renewal period.
We had that shop for 13 years and only closed it because the centre was being redeveloped. In all that time, the shop fit was never updated.
Not once.
Despite protests from the landlord, my sales continued to grow as the product mix evolved. This strong performance made it difficult for them to demand I incur what was clearly an unnecessary expense. The $250,000 we’d spent on that initial shop fit delivered 13 years of returns, far exceeding the five years I had originally expected.
The lesson is clear: A dynamic product mix and good sales will always trump a static, “perfect” fit-out.
How to Be Frugal and Build Character
Our advice is to be aggressively frugal with your shop fit.
Use readily accessible, free, or low-cost everyday items wherever possible. Only invest in purpose-built, custom fittings when there is absolutely no other option.
The benefits go far beyond cost savings. Regular furnishing items, “found objects,” and repurposed pieces bring a unique character to a shop. They reinforce your local connection and subtly show customers that you care about sustainability and the environment.
Instead of custom-milled shelving, consider these ideas:
- An old dining table in a fashion business, with chairs holding jackets and shirts “served” on plates, with a dress as the centrepiece.
- Old, rusted farming equipment used as a rustic display for locally made gifts.
- An old cast-iron bath filled to the brim with bath bombs, soaps, and lotions.
- A classic old school desk (complete with lift-up lid) for displaying stationery.
- Wooden chairs dotted around the shop, each hosting a small stack of books or a family of plush bears.
- A decades-old wooden workbench used to display modern, high-tech tools, creating a powerful contrast.
- A rack of old school lockers used as a quirky bookshelf.
- An old tool shed workbench repurposed to display gifts for men.
Warmth Wins Over Polish
While shoppers may occasionally comment positively on a beautiful, expensive shop fit, they are highly unlikely to purchase more because of it. The main exception is in high-end, luxury fashion, where customers are buying into an image built on overpriced brands.
For the rest of us, our product is the hero.
Be frugal. Create your retail space with items that, in and of themselves, add warmth, history, and character to your shop. That’s a return on investment you can’t get from a catalogue.
