by Lina Martinez
Setting up the perfect retail business can be rewarding, but it is hard work. Many new companies will fail, this might be down to several factors, all of which you need to consider before jumping in with both feet.
Here are a few things that you really must be looking at when you are first starting. Maybe you are new to retail, or perhaps you've worked for a significant chain. Regardless of your experience, you need to enter into such an undertaking, having done your research and planning.
Brand
Think about what type of retailer you want to be. Have a mission statement and work towards that goal. Having a sense of clarity will make it easier to make decisions as well as making defining yourself more straightforward. Pick a name that lets people know what you are about. If your name is too abstract, it might pass people by. A memorable name that rolls off the tongue.
Get your branding designed by a professional. If you want to stand out, you need to be unique. A clear, identifiable logo will do so much work for your brand.
Forward Planning
Planning ahead will ensure you have every eventuality covered. You will need a robust budget which factors everything you may need, assuming the maximum cost for that item. You will need to consider rent, rates, shop fitting costs, till systems, payment processing companies, hiring and paying staff, paying accountants, the value of your stock, depreciation and of course taxes. You will need to think realistically about how much you are likely to make. How much footfall do other traders get in the area? What is the appetite for your products?
Getting an unplanned charge when setting up your retail business can be a huge setback. If it is too large a cost, you may not be able to cover it, and it could postpone or halt your plans. With this in mind, you need to include a contingency fund in your budget of at least 5 percent.
The Right Product
You might have some great products in mind for your new venture. You might really love them. However, be aware that others may not. Do some market research around your products if you are able to. Friends may be helpful, but you might find that they don't give an honest opinion for fear of offending.
When setting the prices for your products, make sure and think about stock loss. You may get items stolen from time to time; stock gets damaged by customers or in transit. You might have bought your stock without a returns agreement with your supplier, in which case you will need to factor a percentage of write-offs into your profit margins. You will also need to account for taxes. If a product is perishable, think about how many you will lose if they don't sell quickly enough. The cost of the lost stock will need to be covered through what you actually sell.
The Right Space
Getting the right venue is vital. You need to make sure that you are going to get the footfall that you need. Look at other retailers nearby, consider if they match a similar demographic to you. If you are opening a high-end outlet, you don't want to be nestled between bookkeepers and bars.
Have a look to see if there is planning in place for any substantial changes in infrastructure near your potential location. Big changes in the area might be a benefit or a hindrance to your business. Get into the details of the planning permission and try to understand the impact it will have on you and your business.
An online store is pretty much essential these days for any retailers. You might want to have a fully branded website, or just run an Etsy store. Whatever you pick, having a digital presence will make sure that more customers will be able to visit your store.
The Right Team
The face really does fit when it comes to retail. You will need people working for you that are excellent "people" people. Having staff with the right level of energy, or the right kind of subtlety is important. Make sure you get people who seem to naturally embody elements of your brand.
Get legal advice and make sure you set up contracts with all of your employees. Contracts are there to protect both you and your staff.
Training is vital. Take the time to let your new team know your expectations. The more time you spend training your staff, the stronger they will be.