In 2019, many consumers think about online shopping when they hear the term “retail.” While smaller retailers are finding success online, there’s still a market for brick-and-mortar retail stores. Most of these businesses also maintain a web presence, but there’s something about the in-person shopping experience that can’t be replicated online.
Several studies suggest that in-store purchases aren’t a thing of the past, and online and in-store retail can coexist. If you’re interested in opening a retail business, it’s important to plan for the event. We spoke with experts in the industry to learn more about how to open a retail store.
Generate an idea and business plan
The first step to opening a retail store is coming up with your idea and developing a business plan. You’ll want to start by figuring out what type of store you want to open. You’ll want to answer each of the following questions:
- What will your business sell?
- Who is your target customer?
- What type of prices will your business set?
- Who are the competitors in your industry and local area?
- Who will be on your team?
There are dozens of other questions that need to be answered, but opening a retail store is like opening any other business. It’s critical that you determine what you want to sell and who makes up your target audience. It’s important to create a retail store that satisfies a need of your customers.
“Know your competition,” said Juli Lassow, founder and principal of JHL Solutions, a retail business management consulting firm. “No ideas today are fully original. Understand what options your customers have to you and your offering. The option might be doing nothing at all.
Once you understand your competition, build out your strategy to compete. Will it be on price? On quality? On service? On variety? Be specific on what your competitive advantage is. Know how you will communicate that to your customers through marketing and presentation.”
Like Lassow mentions, 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.
Lassow said being lost in the crowd is a common risk associated with opening a retail location.
“You risk not standing out in a crowded marketplace,” she said. “Consumers have so many options today to learn about products. They have options in where to shop. They have options for how to buy. Your retail strategy of product and marketing must reach your consumer. It must resonate with them.”
Other basic factors to consider include business funding and marketing ideas. Will you need to use business loans? Will you take on investors? What types of marketing channels will you use? Does your team need people specifically for social media marketing? What online channels do your customers use?
Marketing and business funding are both important considerations that should be addressed in your business plan. For funding, it’s a good idea to research business loans and how to attract investors. For marketing, you should be familiar with online marketing channels.
Consider all of your costs as well. Create a list of the fixed and variable costs that may affect your business. It’s easy to brainstorm a potentially successful idea only to forget about hundreds of thousands of dollars in costs. You may find in your research that the cost of starting a brick-and-mortar store is too much for you to handle, and, instead, you should start an online business before eventually saving up and opening a small physical location.
You may also generate new ideas upon learning about the costs of inventory and other business items. Thinking through how to create your retail business in detail will help you find success when it’s time to open your store. For instance, you’ll need a point-of-sale system and a way to process credit card transactions. And you’ll want to invest in the right accounting software for your business.
Read more: https://www.businessnewsdaily.com/15169-how-to-open-a-retail-store.html