Britannia Teas closing storefront, moving online - Owner says rising overhead costs prompted move

Daniel
Daniel MacEachern
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Overhead costs are driving a downtown business owner to move her operation online.

Kelly Jones, owner of Britannia Teas on Water Street, said rising wages, rent and ferry problems have all contributed to her decision to close her storefront and turn the business, which sells teas and accessories, into an online delivery operation.

“For a small business, overhead costs are huge,” she said.

“You look at it,” she said. “You’re

paying rent, and your salaries — they’re your two hugest (costs) when you’re running a small business.”

Crunch of overhead costs problem for retailers

The store has been on Water Street for six years, but Jones said she knows rent will be going up, and as tough as a decision it was — “I cried a few tears,” she said — she decided moving to the Internet was her best option.

“It’s hard because you have a bit of an emotional attachment that big business doesn’t have in the same way that small businesses do,” she said. “You’re dedicated to your customers, and they are a big part of your life, and you really enjoy seeing them every day. And your staff is important to you in a different kind of way, as well. When you’re a small business, you tend to have staff that have been with you from the beginning.

Jones wondered how she’s supposed to keep a bricks-and-mortar store open when even giant corporations are having difficulty.

“Even this morning, on the radio, they were talking about Best Buy and Future Shop, and how they were closing stores, and they said that the reason they were closing their stores is because of overhead. So if big corporations like those guys are feeling the crunch of overhead, we’re doing the same thing.”

Parking has proven to be a problem, she said — but mainly in her customers’ perception of it; Jones says parking isn’t as scarce downtown as people believe it is.

“Everybody complains about how hard it is to park,” she said. “I’ve had customers who emailed me and said, ‘I drove around for 20 minutes and couldn’t find a spot to park so I went home out of it.’ … As much as people complain about the parking, I’ve worked here for six years. I’ve twice not found a parking spot. … There’s a lot more than people think there is.”

Having to lay off her three employees was hard, said Jones.

“Fortunately, I’m really lucky, because they are amazing. They are just really excellent and great and understanding,” she said. “They’re committed to the store, too. Not everybody can say that, I’m sure. They feel like they’re a part of this store, and they’ve even volunteered to come in and work for free, which is great, but is not fair to them, so I wouldn’t do that.”

Jones plans to announce soon when she’ll be shuttering the store and moving entirely online. And while she’s sad about closing the store, she said she’s excited about her Internet plans.

“We’ll be doing delivery of the tea, so we’ll take your order online. We’ve got to get that up and running,” she said, adding that she also plans to take part in more markets, such as Some Good Market in Makinsons.

“It’s exciting, and terrifying — it’s a lot of things,” she said. “But you’ve got to be sensible about what you’re doing. You’ve got to make a decision that’s to the benefit of the store, the benefit of the business, and to the benefit of yourself.”

dmaceachern@thetelegram.com

Twitter: TelegramDaniel

Organizations: Best Buy and Future Shop

Geographic location: Water Street, Makinsons

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Recent comments

  • david
    February 12, 2013 - 11:41

    Sitting around, waiting for someone to walk in and buy some tea....earning a "legally dictated" $80 a shift. You know how much tea you need to sell to make $80 profit, just to cover the cost of overpaying that person? ...et voila, eejots. And get an internet scon to go with your internet tea.

  • sandy bottoms
    February 03, 2013 - 10:41

    with 0.04% of our population now filthy rich, surely everyone can afford to buy these specialty items...yepper, it must be the lack of parking spaces down along water.

  • Brett
    February 03, 2013 - 08:23

    I don't understand the difficulty. If you could keep your revenues the same + or increase profit + not be risking the future viability of your business - why wouldn't you have moved online earlier + phased out the bricks and mortar store? It's a business - a businesses purpose is to make money. Why the tears? Lower your costs - increase the cash coming in - use your new found freedom to focus more effectively on growing your business. I wish you all the best.

  • a business man
    February 03, 2013 - 07:03

    Good for her! Sure, even if she may lose some sales overall, her profits will likely increases. I have done the same thing do.....close down a retail outlet and move to online sales. Sales dropped 40%, but profits went up 300%. It is amazing how much more money you can make when you cut out the employees and the rent. I make a point to buy online to demonstrate to stores that cutting out employees and offering cheaper prices is a good thing. I will be sure to order something from this company's website.

  • original townie
    February 03, 2013 - 06:50

    Sorry Ms. Jones....I can't agree with your statement about parking in the downtown area. It simply does not exist. If you are fortunate enough to find an empty spot, it will most likely be some distance from the establishment you plan to visit. All I see is "no parking" loading zones. Your business has suffered for this reason. I and many more do not go downtown because of it. Reality check.... Meantime good luck in your new business endeavours.

  • Sue Hickey
    February 02, 2013 - 12:23

    Ah Kelly, so sad to see you have to close because of the overhead expenses! I loved going to Britannia when I was out to St. John's. But I will be getting my Lapsang Souchong and my Bonfire Brew (which Dale sent out to me after a visit). Good luck and here's to the tea drinkers that supported you over the years.

  • Jim
    February 02, 2013 - 10:31

    The parking thing... in my experience the people who complain the most about lack of parking are suburbanites - if there isn't an extra big spot directly in front of the main door, they say there is nowhere to park (insert comment on suburban obesity here). I rarely have trouble finding a place to park downtown (of course, I often WALK). Sometimes I have to go to Duckworth or the Harbourfront, occasionally even Church Hill or Garrison Hill, but there is almost always something. Attica tried to blame their business problems on parking a couple of years ago - making themselves look like fools and ignoring the fact that their problem was that their products were ridiculously overpriced and underquality. We'll miss you Britannia - you run a good business and bring life to the street. Sorry to see you go!

  • P F Murphy
    February 02, 2013 - 09:37

    She has a nice store with unique stuff which is what would normally keep customers coming, but the parking is a relativity. When you can go to a Mall or a strip store and be in and out rather than know that you'll have to spend a couple of hours or half the morning going to Water Street, it counts against your enterprise. For me going to Water Street is an expedition with a expected half day duration rather than a drop by one. I don't see why any company would build in the downtown except for the egotism of its CEO wasting his shareholders' returns because he wants an office with a view out the Narrows. Perhaps relocation would have solved this store owner's problems. However with Dominion, Walmart and the other big companies sitting on their empty space for some kind of a 5-year-being-empty tax write-off, those little entrepreneurs who could have prospered in that divided and renovated empty space come crashing down to closure in bottom line reality. Perhaps we should be removing those tax loop-holes so the big stores can't clog the retail space and prevent the little stores who are the real "job creators" from starting and growing. How much more in business, jobs and taxes could we have if Nfld Drive, Churchill Square and Ropewalk Lane were occupied instead of sitting empty?