Schrock Innovations Laying Groundwork for Omaha, NE Expansion

Omaha, NE is a very different beast from Lincoln, NE.  Everything is more expensive, less available, and more regulated.

Despite the challenges, Schrock Innovations is planning a massive expansion into Omaha in 2010.  Replicating what we have done in Lincoln for $850,000 we are planning to spend nearly $1.9 million to establish a presence in Omaha.

Didn’t Schrock Already Have an Omaha Location?

Schrock Innovations entered Omaha in 2004 with a small 1,500 sq foot expansion office on 84th and Maple Street.  We had a radio show on the lightly listened to KOMJ Magic 590 AM, and we managed to generate a profitable first year of operation with a light staff and a lot of small-ticket repair work.

In 2006, Magic 590 was flipped to an all-sports format and re-branded as Big Sports 590.  We lost our radio show, and with it the only means of marketing that we had cultivated in Omaha.

We tried to move to KKAR 1290, but after 6 months of radio we only had 2 new customers to show for it.  KFAB did not have any available air slots, so we cut our losses and killed the Omaha radio show.

From a financial perspective we should have rolled up the Omaha physical location right then and there.  From a moral perspective the right thing to do was to keep the store open to service the hundreds of warranties we had sold on new Modular PCs.

We tried to hedge our losses by locating our web development staff in Omaha and moving the location to a lower rent area on 93rd and Maple.

Our lease on that location expired in October of 2009, and our landlord had the opportunity to lease to a longer term tenant.  I was not willing to sign a long-term lease in that space, so we rolled up the location in November 2009 and went to 100% mobile service in Omaha.

What is Going to Be Different This Time?

In a word, everything.  The most basic barometer is money and the #1 reason our first entry into Omaha didn’t become a permanent fixture was capitalization.

On our original  expedition into Omaha we spent just under $200,000 and managed to cross break even on all start-up costs by mid 2007.  When we lost the radio show we did not have the time to develop and cultivate a new advertising medium while maintaining basic services.

This time we are entering the market with a few more factors on our side.  First, we are capitalized.  We are not borrowing one single penny to make this happen in Omaha.

Second, we have a primary and a secondary advertising medium developed and ready to launch.  One model should be enough to gain penetration rapidly, but if it fails or falls short, we have a backup plan that we have been testing successfully in Lincoln for months.

Third, we have a staffing plan that will allow us to add new people to our Lincoln Service Center and train them there and then move some of our existing employees into the new Omaha Service Center to assist and train our new Omaha staff.  This “culture graft” will help us maintain our normal service-focused edge as we bring in new people who may have been trained as technicians instead of service providers in the past.

When and Where Will it Be Opening?

We have narrowed our possible locations down to two possibilities – Village Point Mall at 168th and West Dodge Road, and The Shoppes at Legacy at 184th and West Center.

We are targeting September, 2010 as the opening date for the Service Center.

I will have more updates as we lock things in, but all in all this has been a VERY busy month and should be an interesting 4th quarter as well 🙂