#111 Thoughts on opening an additional shop (14/7/2024)

Welcome to this week's journal! Last week I mentioned the possibility of opening a third store. Lately I've been busy preparing for this. Many people think that opening a store is expansion, and expansion means success, but that's not always the case. Sometimes there are hardships to be overcome. Let me use my own Re Pillow Co. as an example, while things are quieter, to explain:

1. Currently, Re Pillow Co. only has two stores, one in Tsim Sha Tsui and one in North Point. Because we have so few stores, our bargaining power with the mall is very low once the lease expires. The mall knows that these two stores are the lifeblood of the company, meaning we've essentially been "held hostage." It would be fortunate if they didn't raise the rent ... Adding more stores to diversify revenue streams is actually a way to protect ourselves. Sometimes, adding more stores is actually about increasing our bargaining power .
2. Adding branches and expanding the scale can spread production and R&D costs, ultimately benefiting both the company and users. The principle of economy of scale should be quite clear.
3. After adding stores, it becomes easier to compare which location is better and which has better business. Then, the unprofitable stores can be closed down and shut down, which is commonly known as "exchanging goods". It is a way to both advance and retreat, and in the long run, it is a more efficient way to use resources.

It's worth mentioning that doing business is a high-risk endeavor. Opening multiple shops also incurs many additional costs, making it not easy. I'm still learning as I go. The above is just my own opinion and may not be correct. But that's how doing business is; you bear the risks yourself.

The above is what I wanted to write this week. I'm trying to make sure my weekly journal entries aren't all the same; this week's format is a bit different. I hope everyone is doing well. Life can be tough sometimes, but I'll do my best. There are many things I don't know how to say, but let's all keep going. The days of hardship, grievances, and things that can't be expressed will eventually pass, and things will get better afterward.