How to Start a Retail Business

How to Start a Retail Business

Starting a retail store is a systematic process that requires knowledge and money.

1) Figure out what to sell and if there is a market for it

Whatever you decide to sell, be it a product or service, you need a business that will grow in today’s and tomorrow’s markets. Make sure that there is a demand for what you want to sell before a final decision is made.

2) Make a financial and business plan

Unless a person is independently wealthy and wants to use that money, they are going to need a loan from either a bank or another person. The startup costs may not be very high, but cash flow is needed for the overhead until the business can turn a profit.

Creating a business plan isn’t required for a successful business, but it is a good idea and the bank will probably ask to see it. A business plan basically outlines a business’s short and long-term goals. If you don’t know how to make a business plan, there are software programs out there to assist in creating one.

3) Finding a location and insurance

Once a product or service is decided on and you have the money, an exact location should be found. If you aren’t buying the property, a one-year lease is better than getting something longer because if the business must be closed, you don’t want to still be responsible for a long-term lease. In the area that you’re considering for the business, look at the competition in that area. Are there already businesses selling what you plan to? Is there a need for another business selling the same thing? While multiple gas stations grouped together may be profitable, several flower shops together probably would not be since gas is a needed item and flowers are a wanted item. Once the location is acquired, you must get insurance.

4) Paperwork

To keep your business name from being stolen, you must register your business name. A name can be registered for only your use in your city or county, in your state, or nationally.

In order to operate a business, you must have a tax ID number and a business license. A tax ID number allows a business to collect sales tax and buy items at wholesale from other companies.

When applying for a tax ID number, you must list whether your business is a sole proprietorship, partnership, or corporation. Each option has its own benefits, but when first starting out, a partnership makes more sense because you have someone who can help you. If you have a partner, that is also one less employee that you will need.

5) Buy stock and equipment

Once things start coming together and before your grand opening approaches now is the time to wrap up the loose ends. If you are selling a product, make sure you have enough stock on hand. Now is also when you need to purchase cash registers, displays, tables, decor, etc.

6) Hire employees

No matter what your store hours will be, you will probably need employees. At first, it would be best to ask friends and family to help you out so you don’t have to hire many people. Once business picks up and you can afford employees, then would be time to hire them. But if no one can help you, you’ll need to hire staff.

7) Advertising

Once you get to this point, your finances may be depleting. However, a successful opening doesn’t happen without people knowing that you exist. If you can’t afford a commercial, consider aligning yourself with a business near you and creating a commercial together. If a television ad isn’t an option, try placing an ad in a newspaper. But don’t rely on that alone.

Try hanging flyers at local colleges, giving discounts to certain groups like college students, creating a website, and being listed on search engines. Remember, a grand opening should be fun with food, gifts, and decorations.

Try hanging flyers

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