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Thread: Opening a Retail Store

  1. #1
    smartcookie
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    Default Opening a Retail Store

    I was just wondering if there are any SW people who have opened or are thinking of opening a retail store. My interest is specifically in small speciality retail stores. I'm well aware of the high failure rate...any tips? Thoughts? Resources?

    Thanks.

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    Default Re: Opening a Retail Store

    Quote Originally Posted by smartcookie
    I was just wondering if there are any SW people who have opened or are thinking of opening a retail store. My interest is specifically in small speciality retail stores. I'm well aware of the high failure rate...any tips? Thoughts? Resources?

    Thanks.
    Go to your nearest library or local bookstore and get a book on writing a business plan. Preferably one which gives an example of one for a retail store. You can also find bp software to help you write your own, but others here would have more knowledge about some of the best software for this than me.

    But make sure you write your own bp for whatever retail item(s) you're planning on selling. You'll be at least 100% ahead of most people who try to start a business!

    Good luck!


    PhaedrusZ

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    Veteran Member leebay88's Avatar
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    Default Re: Opening a Retail Store

    I've just started the process of looking to open a boutique retail space here in the SoHo area of NYC. Obviously in any situation Location plays am important role. The place i am looking at is 400 square feet for $6,500 per month. very expensive... Landlords would like to see what improvements you are planning a doing (sometimes there is no rent during the build out phase). What type of store will it be? Will it improve the area? Will you be working in the store on a daily basis? And of course... your personal finacials.

    Good Luck..

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    Veteran Member Yea's Avatar
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    Default Re: Opening a Retail Store

    I have been strongly considering retail myself for a while.. What is holding my back is the market being so unpredictable. I think what is really important is to have products which cater to a target market which is particularity large in you area also preferably a product line which is not currently being offered.

    Good luck!!


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    Banned Katrine's Avatar
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    Default Re: Opening a Retail Store

    I can write a business plan for you darling, I've completed several successful plans and am working on another at the moment. We'll talk.......

    "Have you ever been to American wedding? Where is the vodka, where's marinated herring?" - GB
    "And do the cats give a shit? No, they do not. Why? Because they're cats."-from The Onion

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    If a cupcake was tossed at me... well, I'd only be upset if it missed my mouth

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    Veteran Member Yea's Avatar
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    Default Re: Opening a Retail Store

    KATRINE, Very cool you do that!! I have also worked on a few startup plans.


    A business plan is great but ultimately it will be your products DEMAND, location and management capabilities that will sustain your business into profitability and growth.


  7. #7
    smartcookie
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    Default Re: Opening a Retail Store

    Well, I'm moving back to New York, but I would never even consider opening a store in Manhattan, at least not the first time around. The gross profit margins you must make in order to pay the rent are unbelievable...

    I'm considering a lingerie store. Not stripper stuff, but high-end luxury lingerie. I would consider Brooklyn and parts of New Jersey as possible locations.

    I'm not afraid of a business plan, though I'll gladly accept Katrine's offer. The personal finances issue, however, is a difficult one. I'm knee-deep in debt and have no equity to speak of.

    So, what do I do?

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    Banned Melonie's Avatar
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    Default Re: Opening a Retail Store

    So, what do I do?
    A. fugeddaboudit, given your personal credit situation

    B. finance your business with expensive sub-prime credit, with everything structured to allow yourself and the business to go bankrupt in 4-6 months if it doesn't 'click'. No risk, no glory !

    C. take advantage of affirmative discrimination gov't programs that will provide seed money for 'minority owned', 'women owned' new businesses

    The type of product you're talking about selling, and the areas you're talking about selling that product in, place the product as a 'luxury item' for working/middle class customers. It is virtually guaranteed that working/middle class potential customers in these areas are going to see four things happen over the next 12 months ...

    - little or nothing in the way of pay raises
    - significantly higher property taxes to cover local gov't budget deficits
    - dramatic increases in winter heating bills
    - rising ARM mortgage payments, rising credit card interest payments etc.

    ... thus the customer base you'll be appealing to is very likely going to be 'scrambling' to keep their household budget in the black. The first step in accomplishing this is to reduce/eliminate spending on 'luxury items'.
    Last edited by Melonie; 08-20-2005 at 02:44 PM.

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    Veteran Member leebay88's Avatar
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    Default Re: Opening a Retail Store

    Your product needs to be in the right place. Will lingerie do well in Williamsburg, Brooklyn or Hoboken, NJ? A product like that seems to need to be placed in a high end area.

    Mel is right. There are a lot of beniefits for minority and women owned business. I qualify as a minority business. When getting loans it can help a lot.

    Regarding your busineness plan. Nothing against kat and her ability but I would strongly suggest you write it yourself. It doesn't need to be too extensive, it's just a great exersice for you to work out the kinks. The plan I am presenting for this store is only 5 pages (including financial projections). My primary business' plan is 30 pages with financials. Whe you get a basic plan written you can get somebody to clean it up.

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    Default Re: Opening a Retail Store

    I had a retail store once and it bombed mainly to lack of customer research and marketing.

    I would say before you even consider having a shop is to research the area, demographics of the potential buyer, profit margin, business rates and taxes and how much savings you have. You will have high overheads. Do you qualify for a small biz loan?

    Firstly, what other competition do you have in NYC? Research the other shops and their locations. Try and go for a fashion area since they are easier for shoppers.

    Redesiging a shop interior always costs more than the estimate. Complications can arise and builders always find a way to charge more. Also I expect the shop rent to be astronomical in NYC. You'll probably make a loss in the first year due to startup costs and break even in the next.

    Marketing and PR will take a chunk out of the budget. A good PR group can probably help you with the opening party. Also try and do press releases, AD work yourself. It will save you a ton of money.

    Estimate the profit per item including the costs involved (i.e rent, employees etc). Having a shop is a great way to make neighborhood friends with fellow shopkeepers and customers. Other times, if you have no employees it can be kinda boring.

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    Newbie starman1148's Avatar
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    Default Re: Opening a Retail Store

    I own a successful retail gourmet store that has been in business since 1979 in St Louis. Let me know if you have specific questions and I will try to answer them.
    A few quick pieces of advice:
    1) As previously mentioned do your market research.
    2) Make sure you have adequate finances .
    3) Keep your cost low, don't sign too expensive a lease .
    4) Start at a comfortable size and THEN expand.
    5) Get the right computer system that works for your business.
    6) IF you have a partner work out your "arrangement" in writing in advance.
    7) Plan all finances on a "worst case" scenario.
    Do something you find interesting and exciting.
    9) Try to be creative yet do something that has worked elsewhere.
    10) Be prepared to work like a sled dog in Alaska during the busy season.
    11) GO FOR IT!!!

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    Default Re: Opening a Retail Store

    I have owned a gym and tanning salon for 3.5 yrs. I have done this off of creative financing, blood, sweat, and tears. I had no business plan or major loans. My husband and I did it off money we saved and slave labor . Doing it over again?

    Absolutely! But I would never go about just jumping in like we did. We are both very knowledgable and involved with the business. As for doing more homework on demographics, having capital funds, and so forth would be a must. If my husband did not have the oportunity to personal train and "float" the business through the slower summer months , we would not have made it. Ditto for dancing as well.

    Going into business with out a plan and money damaged our credit , which hurt when we tried to get a loan. After the money started going into the black, our credit has been repaired and I got an outside investor. Live and Learn!

    Be prepared for the stress and ups and downs. If you take the advise of all these posts and plan hopefully you wont go through as much stress as I did. Good Luck!

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    Default Re: Opening a Retail Store

    Have you thought of starting your business online first? This would help on the overhead expenses and start up . Then as things start going in the right direction finacially start with a small boutique.

    If things dont work out at home you are not going stuck in a lease. Not to meantune saving money , personal time, gas, insurance, utilities, City hassles, and payroll.

  14. #14
    God/dess montythegeek's Avatar
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    Default Re: Opening a Retail Store

    Quote Originally Posted by starman1148
    I own a successful retail gourmet store that has been in business since 1979 in St Louis. Let me know if you have specific questions and I will try to answer them.
    A few quick pieces of advice:
    1) As previously mentioned do your market research.
    2) Make sure you have adequate finances .
    3) Keep your cost low, don't sign too expensive a lease .
    4) Start at a comfortable size and THEN expand.
    5) Get the right computer system that works for your business.
    6) IF you have a partner work out your "arrangement" in writing in advance.
    7) Plan all finances on a "worst case" scenario.
    Do something you find interesting and exciting.
    9) Try to be creative yet do something that has worked elsewhere.
    10) Be prepared to work like a sled dog in Alaska during the busy season.
    11) GO FOR IT!!!
    Starman speaks volumes about small businesses and why they often fail. The two biggest are not deep enough pockets and signing too expensive a lease for the sales volume. Also remember that you are the last one paid, not the first. What are your competitors? Victoria Secret at the mall or Walmart, or both. Where are people going to park to come to your shop and who is going to want to schlep their in th cold/snow/rain. the next thing is help --they have to be reliable or you fill in for them at no pay and all hours cause you can't say the store is open from A to B and have no one there and be fark.

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