Retail Case Studies for Occupancy Costs
How closing loss-making stores and negotiating rental rates can maximise your bottom line and save your business. How much are you paying in rent?
Occupancy Cost Case Studies
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Case Studies

Case Study – Retail Fashion

The Client: 43 store national retail fashion chain
The Challenge: Average 23% occupancy cost across all stores
The Solution: BDC conducted a complete portfolio review and immediately negotiated the closure of 16 stores (10 mid-term and 6 at lease expiry) at zero exit cost to the lessee. Over the following 3 years BDC implemented a growth strategy and grew the network to 68 stores across Australia. The client achieved an average occupancy cost of 18% with all stores contributing to head office profitability.

Case Study – Retail General Goods

The Client: National retail chain of 53 company stores
The Challenge: Average occupancy cost at 26%
The Solution: BDC negotiated 15 store closures (12 mid-term and 3 lease expiry) at zero exit costs to lessee. The client achieved between 15-30% gross rental reductions for additional 28 stores on existing mid-term leases with no penalties or surrender fees. BDC returned the chain to profitability and reduced average occupancy costs from 26% to 17%.

Case Study – Pharmacies

The Client: Two branded pharmacies with mid-term leases in place and 4 years left to run
Location “A” – Annual Rental $892,000 gross p.a.
Location “B” – Annual Rental $650,000 gross p.a.
The Challenge: Occupancy costs crippling profitability
The Solution: BDC negotiated rental reductions of $142,000 p.a. and $150,000 p.a. respectively. New 7 year leases for each pharmacy were also negotiated. A net saving (excluding escalations) of >$2.0 million over the lease term were achieved.

Case Study – Famous Fish

End-To-End Google Commercial Chrome Technology
BDC’s client Steve Costi’s Famous Fish has become the first business in the world to adopt end-to-end Google Commercial Chrome technology. BDC worked with Nuon, a strategic partner of digital signage leader AOPEN, along with Famous Fish to integrate this digital technology into their first store in Victoria. The technology has helped boost brand awareness and transaction values by nearly 29% while blending seamlessly with a historic seaside aesthetic.

Click here to read an article on the Official Google for Work blog about this case study, and watch the video below.

 

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