Your Mystery Shopping Business - How Much Money Can
You Make.
By
Shari Joseph
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1008 [
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Mystery Shopping companies send
"mystery" shoppers out to dine or shop at their client's
Business. The shopping company then provides the
client with a report on the shopper's
experience. Shoppers love it - they get free meals,
merchandise and some income. Clients
love it - they get to see what their customers are
thinking and experiencing. As the owner of
a mystery shopping company, you would
love it - you would make a very nice steady income.
Owning a mystery shopping company is a great
business model for a number of
reasons:
- Costs nothing to start.
- Unlike many other business models, you don't have
to buy merchandise, and hope
someone buys it.
- Once you make a sale to a client, you usually
provide reports on an ongoing basis. This
equals a steady income on one sale alone.
- It's vital to the financial health of a business
to know what their customers are thinking and
if they will return. A mystery-shopping program provides this
valuable information.
How much money can you make as the owner of a
mystery shopping company?
Let us start by determining the expenses for a
single mystery shop. These are basic costs to
consider:
- Shopper fees, over and above reimbursements for
meals or merchandise.
- Report verifying and editing --if you pay someone
to do this.
- If you want to automate many of your processes,
there are outside automation services.
After an initial set up fee, most charge a per
report fee, and that amount is very little.
- Ongoing expenses like phone, office (if you have
an outside office), web hosting.
- If you have a tremendous amount of shops each
month, you could utilize the services of a
scheduling company to schedule the shops for you.
As a general rule of thumb, all these expenses
should add up to anywhere between $5 to
$20.
In addition, again, the beauty part of this
business is that most of these expenses are only incurred
in the process of doing a report. If you work out
of the home, then costs would be almost
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So, as a conservative example, let's say your
expenses per report are average to high and
they are $15 per report. I own a mystery shopping
company. Just so you know, the last time
I figured out our expenses, which includes an
outside office, the total expenses were $9 per
report. That means a whole lot of profit per
report.
However, working with the $15 a report cost -- for
the sake of this discussion -- let us say a range
to charge might be anywhere from $35 to $50. With a
$15 report cost, let us consider
charging $45 per report. Again, these figures are
just for the sake of this article. There are a
whole lot of other considerations before
determining what to charge.
If expenses are $15 per report, and you charge $45
per report, profit equals $30 per report.
Just so you know, our profit usually averages about
$35.
Now, let us multiply, using the following examples.
Client #1.
We try to do at least 2 shops per month per location. Let us say this client
has 3
locations. That equals 6 shops per month. At $30
profit per shop, you would make $180 from
just that one client. And remember, once you get a
client, you don't have to keep selling
them. The work automatically goes on unless you
have a different agreement with the client.
- Client #2. Maybe this client has 5 locations that
you shop twice a month. That equals 10
shops a month at $30 per report profit. That is
another $300 per month.
- Client #3. Maybe this client also has another 5
locations that are shopped twice a month.
This would equal another $300 per month.
From 3 clients, your profit would be $780 a month.
Since, in this example, you are paying
someone to edit your reports (that's part of the
expenses), your time is freed up to do
mostly sales. These numbers would skyrocket.
In this business, 3 clients is barely getting
started. I have one competitor (who is a friend)
who told me he has around 800 clients, most of whom
have only one location. While he has
to enlist the help of a scheduler and editor, his
income is still extremely healthy.
You can make even more money by being a little
creative
I have frequently had clients mention to me they
wanted more reports than they originally
signed up for. After all, these reports can
actually become addictive to your clients. Plus,
they can use the report scores for any bonus
program they have.
An example of this is a client we had many years
ago who had 7 stores. They wanted 1 shop
per month per store. Once they saw the value of the
reports, within a year, we were doing 4
shops per location per month. That was 28 shops per
month. The profit, after expenses, was
very nice! 28 x $35 (our profit) = $980 per month
just from one client.
Since store owners often use these reports to solve
operational problems, you can also
provide them with staff training. This alone would
add nicely to your profit.
Another possibility. This one came from one of our
clients. They wanted their competition
shopped so they could compare their operation to
their competition. This client told me that
the information received from these extra reports
was invaluable.
Want to really pump up your income? Get a Private
Investigator's license and provide shops
to "spot" for theft. You can charge a lot
more for these types of shops.
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So, how much money can you make as the owner of a mystery shopping company?
