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Gift Shop Opens in Durham, N.C., Shopping Center

Posted on: Tuesday, 1 November 2005, 00:00 CST

By Sue Stock, The News & Observer, Raleigh, N.C.

Nov. 1--Tre Bella gift shop had its grand opening in a Durham shopping center this past weekend, but the company has been in business for more than a year.

Until now, the small floral and gift business has operated out of Becky Simmons' Durham home. Simmons, along with her sisters Rachael and Kate Price, took orders by phone and relied on word of mouth and good, old-fashioned shoe leather to generate sales.

The trio tested their business as a home-run, phone-order operation before committing the time and money to a brick-and-mortar store.

"We had to see if it would have enough business to sustain itself," Rachael Price said. "We had to see what the demand would be."

They decided demand was there, and Tre Bella's gift store opened Saturday in Durham's West Village. The sisters plan to open a second location to house the floral portion of their business in early 2006.

Their approach to starting up was a bit unconventional, but it's growing in popularity locally and nationally among smaller entrepreneurs.

Before signing a lease for a store, some business owners harness technology to test their ideas as Internet-only or phone-order operations. Two big benefits are lower startup costs and less risk.

But there are challenges to having no address except one beginning with "www."

"It's really hard when you go to someone and say, ŒWe don't have a storefront,' " Kate Price said. "It kind of lowers you in their eyes."

There's the additional challenge of helping people find you on the Web, said Kim Grant, who runs a Raleigh-based online store selling pet gifts and bereavement items (www.kimspets.com).

"You have to learn all about search engine marketing, trying to be really high up on the list if people search for a certain thing on Google or another search engine," she said.

To help prospective customers find her site, Grant started an

e-mail newsletter. She also tries to get her site linked with other pet-related sites and mentioned on Web logs.

"It's a little harder than I thought it would be," she said. "There are more and more people coming online, which makes it harder to stand out."

For many, the online tryout is the way to go. An Internet business can be set up for a few thousand dollars. A phone-order business run from home may only need materials and supplies, depending on the product.

"I have a small amount of cash, so it makes sense for me to sort of walk before I run," said Alison McLaurin of Raleigh, who sells her own line of greeting cards online at www.tikilynn.com.

"This way I can still follow my dream. Slowly but surely, it's getting there."

The testing approach reduces overhead, including what a business owner would pay employees and vendors.

Tom Best said he chose a phone-order operation because he didn't want to hire employees immediately. He spends most of his time making by hand the nine varieties of cheesecake he sells through his Raleigh company, Peacock Moon Cheesecakes.

"I've had a retail business in the past," Best said. "I knew cooking and being at the counter weren't necessarily going to work well together. Hopefully, by the time you get popular enough to open a store, you'll have some money and be able to hire a staff."

Online retail is growing as national chains place more emphasis on their Web sales and more small independents such as Tre Bella start up.

In 2004, online sales increased 24 percent, to $141 billion, according to Shop.org, the online retail branch of the National Retail Federation. But the proportion of online retailers reporting profits declined, from 79 percent to 73 percent, which may indicate an increase in newer, not-yet-profitable businesses.

"Some things always remain the same," said Scott Silverman, executive director of Shop.org. "Eventually, you need to build your brand and draw customers to you."

On average, Silverman said, it takes three to five years for an online business to become profitable.

"But it all depends," he said. "There may be some businesses that grow slower or become profitable sooner. It really all comes down to if you've got a good product -- no matter what you're selling -- or if you're a brick-and-mortar retailer or an online store."

The most successful online businesses can make the jump to a retail outlet. But if a business does well enough online, there may be little reason to open a store location, Best said.

"I've read about businesses that kind of stop at the Web," he said. "Your whole country is your market. If it catches on, you could be quite busy, even without a store."

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Copyright (c) 2005, The News & Observer, Raleigh, N.C.

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Source: The News & Observer

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