Running a shop is often overlooked as a biz opp. However, as old, inefficient retail businesses go out of business in the crunch there are more and more opportunities to start new shops. Here’s some advice to help you decide if starting a shop could be for you.

What You Need To Know About Running A Shop

First of all you need to bear in mind the pros and cons of running a shop as a biz opp. Shops tend to have higher than average overheads, and it’s particularly important to pay close attention to the fixed costs – the things you have to pay for no matter how much or how little you sell. On the plus side, you can (hopefully) benefit from a good footfall past your door that costs nothing in terms of advertising costs. Also, shops can benefit from a high degree of customer loyalty.

Here are some important points to bear in mind when considering a shop:

Do your market research. Make sure there’s a good demand for the products you intend to sell in that area. Find out how much of it they buy, and what price they are prepared to pay. Find out if any other shops in that area already sell that product and what they sell it for.

There’s no substitute for really getting to know the market in that area before taking the plunge.

Location, location, location… is everything when it comes to opening a shop. Make sure there’s good footfall past your chosen location, since passing trade is the bedrock that all shops need for success.

If your location has handy parking, is near a station, or has other busy shops nearby so much the better.

Work out your costs carefully. Overheads are a significant element in any retail business, so estimate them carefully. Get estimates of everything such as rent, business rates, utilities, insurance, staff costs etc. Now work out your likely daily sales and gross profits. Does everything stack up financially?

There is a lot to be said for overestimating your likely running cost by 30% and underestimating your likely sales by 30%.

Check the details of the lease carefully. Of course you should check that the monthly rent is competitive and fits within your budget. But there is more to consider too…

Unlike renting a house or flat commercial leases often make the tenant responsible for the costs of insuring and maintaining the property too. Check if that’s the case and budget for these costs in your plans. It could make what seems a very reasonable monthly rent higher in practice.

Consider a pop up shop. Pop up shops are the latest thing in retail. They allow you to test a new retail business idea, make lots of sales quickly, and keep your overheads down.

Here in simply terms is what a pop up shop is: basically you buy a job lot of stock and just rent a shop for just a few weeks, or even just a few days. Make a big splash, price your goods at very competitive prices, and aim to sell as much as possible in the shortest possible time. The idea is that you enjoy all the benefits of running a retail business but don’t have to meet the overheads week after week.

Pop up shops can be especially good for seasonal retail – say selling holiday goods in summer and Christmas gifts and decorations in the autumn.