From the very first conception, the thought of opening a retail business is an exciting one. Often it is a way in which a keen hobbyist can turn their passion into a way of making cash, as have so many before them. It makes sense that someone should pursue a career doing what they love. Being their own boss is rewarding but enjoying the work they do is priceless and can lead to a happier, wealthier life.
So you are about to take the leap and move into retail. It’s not going to be a cheap project. Here are some of the major, and minor, costs that you will encounter before the doors open to the public.
Ask yourself whether the business is going to rely on passing trade or is it more of a niche outlet. If the business specialises in a particular field then it may be possible to rent cheaper premises away from the high street. Often car parking is a big factor in business accessibility so this should be considered too.
If the shop does rely on passing trade then a prominent position is desirable. This will cost more in rent and business rates than a side street store of comparable size but, hopefully, the increase in footfall will bring more business to cover it.
The business rates are based on the rateable value of your property that can be sourced from your local authority or online. Business rates are high, but there is a scheme currently in place where a new small business can receive up to one hundred percent relief on rates where the rateable value is below six thousand pounds. A rateable value between six and twelve thousand pounds will receive a rebate on a sliding scale. Above twelve thousand pounds there is no rebate available at all. Rates are a big problem for retailers so be sure to check them out well in advance.
It is often the little things such as shelving or sweet dispensers that add up and cost a lot of money. Be realistic when planning the interior design of the shop and add an extra amount for contingencies. These things often cost more than people anticipate and catch people out when the allowable budget is too small.
The shop and people working there will need adequate insurance in place. Employer liability insurance is a legal requirement to protect your workers as is public liability insurance for the protection of the public.
Firefighting equipment is another expense that is often forgotten. It is not a legal requirement in this country to have fire extinguishers in a small shop but the insurance will probably be invalid if they are omitted. Most shops will need a foam extinguisher and a co2 extinguisher for electrical fires.
Installing a scanning cash register at the point of sale will be expensive unless you are able to build your own using a computer and a touchscreen There is free software available online for this, and it can be integrated with stock control software too.
All of these things must be paid for before stock is even considered. As you can see, opening a shop is an expensive business. Luckily, some of the expenses are one time costs and after a couple of years the shop should be self-sustaining and making a profit. Opening the shop could be the best step you ever take to improve your lifestyle.