When you hear the word retail in 2020, you immediately start to think about online shopping and e-commerce businesses. And while you could find retailers who are successful online, there’s still a chance for brick and mortar retail stores, who while they could have an online presence, recognize that the in-person shopping experience is unique and couldn’t be replicated online.
The latest studies have proven that the in-store buying is not obsolete at all and that online and in-store experience is possible to coexist together, so the real question here; how to plan for opening your retail store? We have gathered the insights of experts in this article so that they could guide you on your journey:
How to Open a Retail Store ?!
Starting your own business by opening a retail store is not impossible, but it requires some measures and procedures to ensure success in this niche. Hence, we put for you a great listing of aspects that you need to open your own retail store, which are:
1- Create an idea and a business plan
In the beginning and prior to opening your retail store, it’s logical to come up with an idea and develop your business plan, so that you figure out what the kind of business you want to do is. Here are the top questions to answer:
- What are you going to sell?
- Who is your target audience?
- What will be the prices?
- Who are your competitors?
- Who will form your team?
There could be possibly many questions to answer, however opening a retail store is just like opening any business; defining what you want to sell, who your customer comprises of so that you create a retail store that fulfills your customer needs.
Understanding your competition is important. Because original ideas are almost a few nowadays, realize what are the options available to your customers and what sets you apart from them. You might realize that you are exclusively providing what others are not, or you may find that it’s better not to compete in such a specific niche at all.
After you have known your competition, you should now start to formulate a strategy and decide what your edge is; is it quality? Is it the pricing? You will need to be specific. Next, you will need to decide you are going to communicate that to your customer in your marketing plan.
It’s important to understand your competitive advantage and what makes your business unique. Retail is competitive, and you need to be clear on your plan to find success. Identifying how your business helps your target market is arguably the most important aspect of opening any business.
Those efforts are important to avoid getting lost in a crowd of competition and offerings when you first open your retail store.
You risk missing out without a retail strategy that resonates with your customers, as they have many options to choose from; they have options where to shop, and how to get it, so it’s crucial you take care of a strategy that will take care of you.
Other essentials include your funding and your marketing efforts. Will you need to resort to taking loads? Will you accept investors? What types of marketing will you employ? Is your team capable of running social media campaigns? What will be the online marketing channels that your customers will use?
Both business funding and marketing activities are important to prepare in advance. Some considerations could be on how to attract investments and learning more about business loans. As for marketing, it could be of immense use to learn more about online marketing channels where your customers reside.
It’s important to forecast your costs, too. You should create a list of both fixed and variable costs that may impact your business so that you really prepare to open your store. You might learn for example that a brick and mortar storefront is too much to handle in the beginning so you resort to an online business before saving up for a physical store later on.
You may also learn a couple or more ideas when you understand more about the costs of your business elements. Thinking about all the details of your retail business will noticeably increase your chances of success when you decide to open your store. For example, some aspects could be needing and deciding on what point-of-sale you are going to use, how you are going to process credit card payments, and what accounting system you are going to adopt for your business.
2- Pick up a name for your retail store
It’s also important to spend time thinking of a good business name when trying to cover all the aspects of your business plan, so when you brainstorm on having a good business name, you could consider the following:
- Meaning – you would want a name that is recognizable to your customers and also that should have a relatable meaning from your customer’s perspective
- Simplicity – Short and easy should be what you are looking for, make sure that your brand name is as proper as Nike, Apple, Google, and so on, so that your chosen name is a good fit for your branding purposes.
- Uniqueness – opt for a name that’s nothing like those of your competitors, make sure it’s original as much as possible and relatable to your business. Some good advice is to try to brainstorm without looking at other brand names.
Also, it’s important to make sure that the name isn’t taken, and you could confirm so by doing a quick search on google. While naming your business isn’t the most important aspect in the success of your business, it’s worth it to invest some effort in naming your business.
3- Handle your legal basics
Covering your legal basics will mean deciding on a business structure, acquiring the proper licenses and permits, and following the necessary regulations, so that you maintain your operation and stay compliant. Some of these basics include:
- Basic business operation license, which allows you to operate in your city, country or state.
- Employer Identification number that will allow you to hire employees and ensure that your business collects payroll taxes.
- A seller’s license. Needing it or not depends on the kind of items your store sells, and that’s what you get to know when you check your state’s government office.
When selecting a legal structure, you follow a process that is similar to ones other businesses have followed. However, it’s crucial to bear in mind the importance of adopting a business structure that doesn’t place liability only on the owner, so that you mitigate any risk in case the business doesn’t work out. One way is to become a limited liability corporation (LLC) or corporations, that way both options can help limit personal liability.
4- Seeking the right location
If you are opening a brick-and-mortar retail store, then you will need to make sure you choose the best space for your business.
Picking out your main retail space for your business should be extremely important. While it could be tempting to pick a cheap location and hope your business bring thousands of customers using marketing efforts, sometimes there is no substitute for opening in a busy part of the town. Though pricier, opening downtown could bring in many more customers, the thing your business could very much need.
When choosing a location, find where your customers reside; if they live out of town and your open your store downtown, then the ROI will not that high, as the rent will be pricey and the customers will be few. While this tip might appear simple, businesses might overlook opening a retail storefront in an area with their target audience being around.
If you expect to have a lot of inventory, it could be wise to invest in a location with additional space for storage, as you sell at reasonable prices. Other businesses however who have few high-end items don’t need much of space to store inventory. So, don’t forget to take inventory into consideration when picking up a location.
Wait for our second part to find out your full guide of how to start a retail business and launch your own retail store…