Le Travel Store
Moving with the Times
From the casual beachfront store to the glitzy urban shopping mall to the big-box retail model (selling more for less), Bill and Joan Keller have successfully adapted the location of their travel business, Le Travel Store, to match the expectations of their customers. Even as the location changed and the business evolved, however, the Kellers have continued to indulge their original passion for independent travel. The Kellers started Le Travel Store in 1976 in a beachfront store near San Diego. They used $3,000 in wedding presents to rent a storefront, from which they sold charter flights, rail passes, travel books, and other items for the budget-conscious international traveler. In their first year, while Joan continued to work full-time at a bank, the couple set themselves the goal of selling 300 flights to Europe; they managed to sell 328, and the business survived.
Thirty years later, Le Travel Store is in its third location. The Kellers' decisions to change location were, in part, prompted by changes in their target market. The first customers of Le Travel Store were students, who would pull up to the store in beat-up Volkswagen bugs and vans. Over time, Bill began to notice those same customers pulling up in Volvo sedans or station wagons. These customers now had less time but more money to spend. They were taking shorter trips and staying in better hotels. The customers no longer needed-or wanted-budget travel materials (think Europe on $20 a Day). The Kellers decided to adapt to this changing business model and move off the beachfront property into a new development, Horton Plaza shopping center, which was part of the city's revitalization plan for the San Diego downtown area.
As exciting as the Horton Plaza location was, Joan calculated that the Kellers had paid a million dollars in rent over the 10-year term of the lease. For that kind of money, they could own a building. With an SBA loan, they purchased a 10,000-square-foot building in a historic district that soon became energized with retail ventures. Having realized the potential for growth and revenue in the new setting, the Kellers now invest their profits back into the building. Joan calls the excitement surrounding the re-growth of historic city centers as ideal places for business "the wave of the future." Before answering the questions and working the activities, re-read and watch the video on Le Travel Store.
Questions
1. Review the five key factors in selecting a good business location. Which of those factors guided the Kellers' choice for the site of the original Le Travel Store? Explain.
2. Referring to the video, determine which factor or combination of factors the Kellers seem most excited about in their newest location. Recall how the text describes the importance of a building's "image." Describe how each of the Kellers' locations reflects the evolution of their business plan.
Activity
Many successful entrepreneurs got their start working out of their garage, basement, or home office. But part of what made those entrepreneurs successful was their ability to visualize and plan for growth. In essence, the company had to grow up and move away from home.
Imagine your start-up business is ready to move out of the house. (Give your business idea some shape-for example, consider what you're going to sell.) Review local or regional newspapers or real estate websites for business properties for sale. Choose two properties and analyze the advantages and disadvantages of buying each for your startup venture. Then make your final selection
• What were the three most important criteria you used when deciding where to locate your company? Why?
• What were the three least important criteria you used? Why?
• Write a brief paragraph about the advantages and disadvantages each location offers your business and why you ultimately selected the location you did.