Profitable expansion plan: from 8 to 13 points of sale in 18 months.
The challenge
The operator wanted to grow but lacked a solid financial model to evaluate new locations. The last 2 openings had been unprofitable and management had lost confidence in their site selection process.
The strategy
- 1
Development of a per-location viability model with 14 key variables (demographics, competition, occupancy cost, etc.).
- 2
Scoring of 22 candidate locations and selection of the 5 with highest risk-adjusted potential.
- 3
Lease negotiation with flexible exit clauses and graduated rents.
- 4
Design of an operational playbook to reduce time-to-break-even for new stores.
The results
5 new openings with an average ROI of 2.8x in the first year.
Total group revenue increased by 22%.
Average time to break-even reduced from 14 to 7 months.
0 forced closures in new locations after 18 months of operation.