I estimate that the five stores together bring him $500,000 or more in profit in a good year. Out of that, he takes a share. Store owner-managers can also earn a share of the profits, in addition to their salaries and bonuses. A good owner-manager of a successful store could earn around $100,000.
The rest is rolled back into the stores to create a cushion.
Labor is the biggest expense, followed by rent.
The average New Balance store costs about $250,000 to launch; there are 160 in the United States.
“I want my manager-owners to own 20 percent,” Strojny said. “If they don’t have the money, we will loan it to them, and they can pay it back on a monthly basis for three to five years.”
I asked Strojny how he competes with the Internet. If you have been buying the same brand and model of running shoes for the past 20 or 30 years, as I have, why would someone take the trouble to go to the store when they can just have the shoes sent with a few mouse clicks?
Strojny said the big “value add” for his stores is a New Balance machine that scans the customer’s foot, gauges the size and width, and maps the pressure points. The salesperson can more easily recommend the right shoe and insert.
“The inserts are a big draw and a substantial part of our business,” Strojny said, adding that customers asking for inserts are often sent by doctors. He pays $200 a month to rent the scanner but makes several times that on the inserts, which cost between $35 and $70 a pair.
Guzman was on the premises at the Merrifield store on Friday.
“It’s a lifestyle now,” Guzman said. “It’s not a 9-to-5 type of thing. As an owner, you feel like you should be there 24-7. There are going to be sleepless nights. My wife [who works elsewhere] is going to see less of me. If she wants to spend time with me, it’s probably going to be in the office at the store.”
Welcome to the world of the small-business owner.