Anyone here own a retail store (brick and mortar)?

SVreX wrote: In reply to Giant Purple Snorklewacker: Your 1099 idea is illegal 9 out of 10 times. Proceed with caution.

In this situation, I would say 10 out of 10.

Wow, lots of good information gang. I knew this would get good response here. I will now try to go back and make responses accordingly.

Mitchell wrote: Also, schoolteachers are often a frugal bunch, out of necessity. These supplies are often coming out of pocket, so value is paramount. If you are marketing to teachers, what kinds of hours will you keep? Could you be open nights and/or weekends?

My wife is a school teacher and the cheapest person on the planet and she still bought stuff from the previous store.

FYI The previous store opened in 1986 and then changed hands in 2009. I think that the new owner didn't know what she was getting into.

Datsun1500 wrote:

singleslammer wrote: This will be open regular retail hours (nights and weekends). What about running employees through a temp agent? That way I don't actually have ever any employees to pay for.

It's much more expensive. The temp agency has all of the employee expense and profit that is passed on to you... Older retired people are the way to go. They do it more for the social aspect than the paycheck

Got it, moving on!

aircooled wrote:

singleslammer wrote: This will be open regular retail hours (nights and weekends).

Is that even necessary? Theoretically you could be open nights and weekends for your demo. Or, are you going to be supplying home schoolers? (if there are many around you). Some sort of home school support "programs" might be an income source (I suspect you have already thought of this)

There, apparently, is a large home school community in the area with no stores that offer this type of item anywhere near.

poopshovel wrote: Lots of great thoughts/suggestions in the last few posts. IMO. You may be surprised how cheap a million dollar liability policy is. I highly recommend it in the interest of being able to sleep at night. In the first MONTH, I had one employee get a bad cut that required an ambulance, stitches, and left a scar. Didn't have worker's comp set up yet. She could've sued my ass off. Then a customer busted her ass HARD on the steps out front. I went for the big policy and never looked back. RE: The slip & fall thing. My landlord's policy probably covers a lot, but it's literally "cheap insurance." YMMV.

My friend's DIY auto shop carries a liability policy and pays very little. This is a must.

In reply to EVERYONE!:

I do know who the previous owner was and plan to pick their brain once I get this fleshed out a bit more.

SVreX wrote: In reply to singleslammer: I like your idea. Especially the fact that you have identified a market already. Having said that, there is no way I would consider selling school supplies without: A- including an online component, B- selling to homeschoolers (online, and conventions). It's a huge expanding market. And, C- recognizing that the person who makes the most in the majority of brick and mortar businesses is the landlord.

Thanks!

A- My wife thinks this a must and I tend to agree. However, at the very beginning I think that this might be a bit more than I can handle. Alternatively I could start online and then go local.

B- Planning to.

C- I would love to buy a place but I am not sure that I can swing that at the beginning.

In reply to Toyman01:

I am curious if the 20k included the money used to start your business (you offer a service though right?) That is a major concern of mine is making sure that I have coverage until the business is making enough to pay me. I am not afraid to working as much as needed initially. My goal is that I can stop manning the register in a year or less and then just worry about running the business. I should have mentioned earlier that I didn't mean to say I would hands off so much as not being on the schedule permanently. I want to be able to come and go as needed to perform marketing duties and so forth.

The $20K was start up capital in the company checking account. I put in $10K, my business partner put in $10K. We used no debt when we started so it was a cash only deal. I had other funds to keep the household running and my wife went back to work until the business started paying. That realistically took about 6 months. We waited a couple of extra months to build up the business checking account before we started drawing earnings off.

Be prepared to watch every dime and squeeze it until it screams.

Keep in mind your situation is a good bit different. We don't carry a large stock of product. We buy as needed. Unfortunately most of our customers are on 30 day terms and pay in 30-60 days. We end up paying for product before we get paid, but we only have to carry it for 30-60 days. Sometimes that's a large amount, but it's usually short term.

You are going to have to carry stock. My retail experience was working at a hobby shop. I was there for 12 years. Our stock levels were in the $60K-$100K range. If you don't stock it, you can't sell it. People don't want to hear that you can order something. Especially when they can order it too. Keep the store looking full. I used to spend an hour a day just fronting shelves.

You might also want to put together a budget of what stock is going to cost. No one likes shopping in an empty store.

My dad owned a chain of speed shops in SC and he would have echoed what Toyman just said: keep the store looking full, and I'll add: Know your A,B,C movers. As in:

A= stuff that moves QUICK so stock a lot of it, typically small stuff.This needs to be your highest margin stuff, too so be prepared to shop hell out of your suppliers. This will be your bread and butter, it needs to cover your employee costs, rent etc. and that's why it needs to be high margin. Ex: maybe you sell pencils for 2 cents each. That's not a helluva lot, but if you pay 1/3 cent each and sell, say, 5,000 a week that's a considerable chunk of your gross income. If you have, say, 100 quick movers with that kind of margin that starts looking pretty good for your bottom line even though each individual item is not much money.

B= stuff that won't move as quick as the A's but you still need to stock because your customers can go elsewhere. Maybe stuff like special calculators, etc might fall in this category.

C= stuff that you should not stock, special order only. This tended to be expensive low margin stuff in the speed equipment business, dunno if that applies to the teaching supplies biz.

There's also D movers in the parts biz, this is typically stuff that is special order from the manufacturer. Hint: C and D mover orders need to involve a non refundable deposit which should at least get close to your cost.

Dad mentioned more than once he wanted the store's inventory to turn at least 3 times a year. That means start on Jan 1, then by April everything in the store should have been sold and replaced. By August, once again. By the end of December, well you get the idea. Anything you buy that sits on your shelf too long ('dead inventory') is killing you.

Big C has a point. Your categories need to be arranged in the store properly as well. Bread and butter stuff toward the back, big ticket in the middle and impulse at the register. Don't sacrifice organization too much to get that affect.

There is a reason the milk is usually at the back of a grocery store and candy bars and rag papers are at the register.

Did the deed for 8 years in the form of a Brewery.

by the end, I was of theopinion that anyone who worked retail should be allowed to kill one customer a month and get away with it. The public is an interesting collection of people.

33% of every dollar that comes over the counter belongs to the governmnet in some way shape or form. Plus you get the honor of accounting for it and being responsible if you dont dechipher the complex formulas just right.

Safety and ocupational asshats will tell you to spend a fortune on stuff you never thought of.

Your employees will know how to run your business better than you and you are an shiny happy person who must be made of $$$.

If you opened a business based on a talent or passion, realize that you will never get a chance to participate, you will be managing those that do and working for the government in what would have been spare time.

Nobody walks away from a moneygenerating business, so if a person is selling, treat the deal as if you were buying used race car parts; be very susicious and never fall for the "It brings in so much cash, but it cant show on the books" story.

Other than that, being your own boss is cool.

Being your own boss is cool. And the job never ends. I would have responded earlier, but this is the first chance I had.

I have a brick & mortar speed shop. Specialize in '60's & '70's domestic stuff. I do both parts sales and service. Currently the service side is doing better than the parts sales, but that's improving too.

I don't have any employees. I'm it. My wife will volunteer to help when she can.

I can't offer up anything better than what's already here. So I'll just emphasize some points. Don't get crushed by overhead. Have inventory but don't go nuts (see overhead). Expect to work longer hours than ever before. Expect to put plenty of your own money in it. Know who you can count on when you need help.

For the record, I love having my own business. I'm sore, worn out and tired every night. But it's the only job I've ever had where I look forward to going in the next morning.

Thanks guys.

Curmudgeon - I have experience with A B and C parts. My previous position in Utility industry sales dealt a lot with this concept.

I know this is going to be a TON of work but I feel that I have a support network that can make this happen. Inventory is something that I will plan out before I commit fully to this.