how to start a retail business: 7 steps to success

Download How to Start a Retail Business: 7 Steps to Success

Post on 29-Nov-2014

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Welcome to our retail startup guide—a comprehensive “retail roadmap” that walks you through the ups and downs (and sometimes confusing parts) of setting up a brick-and-mortar store. You’ll learn how to choose what products to sell, how to select the right location, how to finance your venture, and more.

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  • 1. HOW TO START A RETAIL! BUSINESS 7 STEPS TO SUCCESS BROUGHT TO YOU BY
  • 2. Let us walk you through the ups and downs (and sometimes confusing parts) of setting up a brick-and-mortar store. ! Youll learn how to choose what products to sell, how to select the right location, how to finance your venture, and more. ! To help you apply the things youve learned, weve also included action checklists after every chapter. These checklists include instructions as well as the time and materials required to complete each step. OPEN
  • 3. During this presentation you will also meet people--not unlike yourself--who were able to open thriving retail stores. ! From a stay-at-home mom who turned her love for antiques into a retail store, to an environmental scientist who decided to start a design shop, the examples in this guide will give you a better picture of the inner workings of a successful retail business (and how you can achieve it). ! We hope that by the end of this guide youll have enough knowledge and confidence to open your own store. ! OPEN Lets get started, shall we?
  • 4. 7 Steps to Start a Retail Business from Scratch OPEN 1. Decide what youre going to sell 2. Size up the market and your competition 3. Zero in on the perfect location 4. Figure out your finances 5. Comply with the laws, rules and regulations in your area 6. Hire superstars 7. Get real with the challenges of retailing
  • 5. Step 1:! Decide what youre going to sell Your products are the cornerstone of your retail business. The question is, how do you pick the right ones? ! Many factors come into play when youre deciding what to sell, but the top 3 things you need to consider are: ! 1. Knowledge / Interest 2. Demand 3. Margin
  • 6. 1. Knowledge / Interest While you dont have to know every little detail about what youre selling, you should have some knowledge or at least a genuine interest in it. Retail is already a challenging adventure as it is, so dont make it harder on yourself by trying to sell something that you dont like or that bores you to death. ! On a more practical level, knowing your product well will help you make the right business decisions down the line. If youre already familiar with your goods, youll find it easier to pick the right suppliers, find the best OPEN people, decide on pricing, etc.
  • 7. Here are some ways to generate product ideas based on what you know or what youre interested in: OPEN a. Look at your hobbies Start with something close to home. ! What are your personal hobbies and interests? Can you make money off of them? ! For instance, if you like gardening in your free time, perhaps you can look into selling plants or gardening supplies.
  • 8. Meet Tammy Biedeman, owner of lifestyle store Sweet Elizabeth Jane in Ellicott City, Maryland. According to her profile on Main Street Story of the Week, Tammy was a teacher turned stay-at-home mom who had a passion for refurbishing and re-purposing items she picked up from flea markets. ! Pretty soon, her house started to fill up with these items, so she decided to sell them through antique cooperatives and other retail outlets. And in 2011, Tammy made a choice to open her own retail store. She did the legwork, leased a space in downtown Ellicott City, and opened up her shop six weeks later.
  • 9. OPEN b. Tap into your line of work Do you have a day job? ! What did you take up in school? ! See if you can use your professional knowledge and skills in the retail world. ! Say youve been working at a salon for years and are looking to venture into retail. You could use your know-how to set up a beauty supplies store.
  • 10. Meet Karen Besson, another retail store owner in downtown Ellicott City. ! With nearly 7 years experience running an art gallery, she decided to use her knowledge as a springboard into retail. ! Karen did some research, interviewed other business owners, and acquired a lease in Ellicott City. She renovated the space and within a month, opened an art gallery-slash-jewelry store called Art and Artisan.
  • 11. OPEN c. Go out there and pique your interest Sometimes, simply keeping an open mind can help you generate ideas. ! Talk to people. ! Visit marketplaces and attend trade shows. ! Look at the businesses that are out there and see if there is a gap that you can fill or if theres something you can do better.
  • 12. Harriet Vaight, owner of design shop Chirpy, is a former environmental scientist who was no longer satisfied in the corporate world. ! Harriet always liked arts and crafts and had a dream of opening her own shop. ! Her retail journey began after she attended various arts and design events. I went to craft fairs and arts trails and saw so many local people making such lovely things, she said. Harriet then noticed that these individuals didnt have a permanent place to sell their creations, and thats when she saw the opportunity to establish her shop.
  • 13. 2. Demand Lets get real here. Interest and passion by themselves wont be enough to build a successful business. ! You may have found products that you love, but if there isnt a real need or desire for them, the business probably isnt something you should pursue. ! Thats where product demand comes in. Validating whether or not people would actually purchase your products is something you should do early on. The last thing you want is to manufacture or purchase merchandise only OPEN to find out that customers dont want it.
  • 14. How can you gauge demand for your products? Take the following steps: OPEN a. See if people are actually buying (or at least searching for) it! One of the easiest ways to gain insights into what people are buying is to check online marketplaces such as Amazon or eBay and finding their bestsellers.
  • 15. Head to Amazons Best Sellers page and study the products. The items or brands on this list will likely be the ones thatll do well in your store. Also note customer reviews, as they can give you insights on demand, as well as the sentiments of shoppers. OPEN
  • 16. On eBay, you can gauge product demand by looking at how well items have performed at auctions. ! Find your product (or something similar to it), and determine how it did at auction. ! How long did it take before it was sold? ! Was there a bidding war? ! How much did it sell for? OPEN
  • 17. You can peruse eBays popular listings on popular.ebay.com and see which items and brands are doing well on the site. If you need something more automated, consider using eBay research applications that provide information on keywords, product demand, and more. OPEN
  • 18. Google Adwords Keyword Planner can also come in handy. You can use this tool to see how many monthly searches are being conducted for your products. Type in keywords or phrases related to the merchandise you want to sell, then note of the number of searches that come up. More = better. OPEN
  • 19. For more thorough insights, be sure to take your research offline. Visit retail stores that carry the products youre thinking of selling and evaluate their performance. ! For example, if a product is on sale or i