The growing popularity of online shopping is forcing more business owners to question the value of running brick-and-mortar operations.
A recent case is Victoria’s Alex Zohar. The owner of Victoria Kiteland and Victoria Miniland has watched his online buyers climb and has decided to close his leased downtown Victoria store at 651 Johnson St. to work from home.
Zohar said it’s more than the costs associated with high rent and overhead.
It’s also about his time.
Zohar, 56, has been working seven day a week since starting the business in 2004. “I’m getting my life back because I won’t need to work such long hours,” he said Friday.
Since launching online shopping about a decade ago, cyber sales have climbed to represent 70 per cent of his business. Overall, about 80 per cent of online sales are to U.S. customers and five per cent are within Canada.
He’s holding a sale to sell off toys and products that are difficult to ship. The storefront will likely close sometime in April just before the lease expires.
“It’s a part of business dynamics,” Zohar said. “We are closing the store. We are not closing the business.”
Zohar plans to set up a local system that will allow area customers to avoid shipping costs.
He first opened Miniland on the lower level of Market Square, where he filled his shop with Lilliputian-sized miniatures for small rooms and dollhouses. He makes and designs many of his products, including intricate cakes and plates of food using polymer clay. A tiny battery-powered LED chandelier with real crystals he designed is manufactured offshore.
In 2008, Zohar moved to a larger space within Market Square and began carrying kites and parts.
Five years ago, he relocated to Johnson Street.
Downtown has been a good base for the business, and was a way to showcase products to tourists.
The kite business is seasonal as sales usually surge in summer. Zohar does, however, sell kites for up to $1,500 that skiers use to pull them along the snow. They also use these kites while riding boards with wheels.
“I believe I’m the largest kite supplier in B.C.”
For the online business, he will be selling kites that can be folded and shipped in small packages.
Mark Colgate, associate dean at the University of Victoria’s Peter B. Gustavson School of Business, said the question for any business should be: who is your customer? “If your customer can find you online, then why would you need a physical store?”
Colgate said a community of this size has a limited market of potential shoppers.
“But if you effectively sell online you can reach millions of people. Obviously it depends if your product can be shipped,” he said.
The fear of Internet shopping has diminished as the online retail giant Amazon has “shown us you can sell virtually anything online,” Colgate said.
Customers can send items back and see that such businesses are trustworthy. “I think all those reservations that people originally had about shopping online are gone.”
As well, the logistics of shipping and packaging goods have improved.
The biggest costs for businesses are normally labour and rent, Colgate said.
On the Web: kiteland.ca and miniland.ca
