PDA

View Full Version : Opening a 'physical' shop - advice



aliwade
01-08-2008, 06:43 AM
Hi, everyone - sorry this will be long!!

I have sold online for several years - mainly through Ebay - but also had a couple of market stalls and worked in a friend's craft shops (papercrafts and cross stitch/fabric/haberdashery). Always thought about having my own shop, and hubby kept bringing the subject up, but always thought that it would be too much of a commitment (financial and time) and obviously my friend would be a competitor. However, my friend has moved abroad and is closing one of her shops (the other will remain open, as she has a good manager to run it) in a town reasonably close to us (we live on our farm in rural Pembrokeshire). Suddenly it became clear that perhaps opening my own shop could be a good thing and yesterday we went to view a possible shop and also visit estate agents asking for details on others. Hubby is willing to finance - he is even talking about buying a whole building and taking the income from rental of flats above the shop!

I need general advice on setting up a physical shop - best places for insurance, taking credit card payments etc.

Also - can you give opinions on the 2 'favourite' shops so far. One is at a slightly cheaper rent (by 10 per week), but a lot smaller. However, on the best retail street in the town, with lots of passing traffic (cars and pedestrians). Most of the storage is a separate building - accessed by steps and footpath (with vehicle access at rear) - which looks like it may be damp (the current user is a florist, so that doesn't affect her). There is an office and small storage area next to the actual shop, so could store paper products in there. We live on a large farm, so could also use a building here for storage, and just take in stock as and when needed. The landlord is someone we know - and I think perhaps the rent could be negotiable (perhaps we could have the shop and not the storage building - or perhaps he would improve the storage building to make it more paper-friendly!).

The other shop is a lot larger, with excellent office and storage at rear. However, on the edge of the retail area of the town, lots of cars going past, but a lot less pedestrians. Hubby says that a lot of my customers would be making a special journey to the town from other parts of the county (or further afield), but I am afraid of missing out on casual custom (we are strongly linked to tourism, and this town is a ferry port to Ireland - so there are always lots of visitors walking in the town). Again, the rent could be negotiable, as the shop has been vacant for sometime and because of the location. What do you all think?

So much to think about!

Ali xx

Fluffy Squirrel
01-08-2008, 07:37 AM
Good morning Ali,

I have no experience in this field therefore am unable to offer advice though I'm sure someone will be along soon with lots of practical advice to help you in your decision.

I just want to wish you luck with your new venture and hope everything goes well for you.

Laura x

Kiamyka
01-08-2008, 08:50 AM
Hiya Ali
Have you done any financial forecasting yet? The reason I ask is I am in the same position right now and getting close to making it happen. Taking into account all expenditure (excluding rent as I am buying the property and it will be a cash purchase) outgoings will be on average 2000 per month - given that a large percentage of my profit is made on what I create with stock that doesn't include much in terms of raw material purchase. My income is also not soley dependent on sales but on income form the healing centre part of the business. I looked at the renting scenario but came to the decision that buying was the best option - If i can help in any way I will - I have a spreadsheet which you could use for the planning (all the formulas are in there to do the calculations for you - Pm if you need to :)

gypsypunk
01-08-2008, 08:56 AM
traffic is the top consideration for physical shop. how to make people visit and all that.
expenses is the next consideration... study ROI

then, yes, what your husband told you about your commitment is another. it is like being married to your fulltime job you would bring home even some problems...

but if you really like it that much with help from hubby, your on a good start

0103media
01-08-2008, 09:21 AM
Don't forget to factor in business rates as this can be a massive expense..

Location location location..

You can also consider piggy backing.. e.g. on the way to my local ikea you drive past loads and loads of furniture outlets within meters of the store.

Yep you want traffic but its worth looking at what the traffic is.. Work of the target customer.

Someone going to a pub or football game is unlikely to buy vs a sewing shop or fabric shop near by...

I'd spend 1hr outside the location and count the people walking past with a sheet of people with something like "will never buy", "might buy", "Will buy" of course you should judge a book by its cover but you could get a gist..

Also ask people walking past, Would you be interested.. I'd invest so much time in the research before considering a location..

Hopefully nattynetty can help too as she has just opened a shop. :D

crafty_clare
01-08-2008, 12:00 PM
I have had a B & M shop for 4 years and would suggest that you check the business rates on both properties. They are likely to be higher on the smaller high street property. Also would you be running workshops? If so do you have room in either? Concider space and light. You will need public liability insurance. Calculate the cost of fitting the shop out, display items often come free if bought full of stock initially but are expensive otherwise. Would you be running a web site alongside the shop? What parking is available nearby?
Retailers are having a tough time at the moment especially hobby/craft shops, are you able to offer something unique?
Good luck,
Clare

nattynetty
01-08-2008, 02:14 PM
Sounds like a lot of the advice I'd give has already been given - completely agree with checking out the business rates as they can vary so much and makes a big difference to the total cost. Also Clare has a good point re fitting out the shop - the bigger premises will cost a lot more regarding fixtures, fittings and stock (and fuel costs to heat and light it too).

I've only been open a few months but from what I've experienced so far people are willing to travel to a spe******t shop - will the shop premises on the outskirts of town have nearby parking? Having sold online too you'll have some readymade customers too who I'm sure will visit you which ever premises you opt for.

Our shop is in a small town and we definitely have people travel here especially to visit us so your husband is right in that aspect but our town is quite touristy and we've also had a number of customers who have noticed us while wandering around on holiday - so you have a point there too! :confused:

We've had to advertise quite a bit so people know we are here (you wouldn't necessarily drive past us if you were going through the town) so you might want to budget that into your costings too depending on your location although word-of-mouth is a wonderful thing!:)

I think once people know your are there (whichever premises you choose) they do think of you if they need something crafty, for example we've had lots of non-crafty grandparents this week buying bits to keep the grandkids amused and we had a teenage boy buy a reel of ribbon to decorate a bike he'd bought for his girlfriend - not your typical customer.

After all that waffle I think what I'm basically trying to say is make sure your shop is easy to get to and easy to park near, factor in ALL the costs and make sure everyone locally knows you are there. Some very successful craft shops I know of are based on industrial estates but I know of others on industrial estates that are struggling very very badly - so location can't be the only factor.

And by the way, yes it is a massive commitment money and especially time-wise and don't believe your husband if he promises to do all the housework once you have the shop...believe me that's a lie ;)

aliwade
02-08-2008, 11:40 AM
Thanks for all the advice and support :)

I am having serious doubts as to whether having a physical shop would fit our lifestyle - now and in the future. Hubby keeps talking about having staff to run the shop - so I don't need to be there all the time (as he often needs me to help on the farm, I have arthritis and sometimes need to rest, and we are also planning to travel to Spain a lot) - but I know from working in my friend's shops that financially that may not be possible; certainly for the first year or so.

Will have a chat with him later. We are just about to redevelop our farm - into tourism and a livery yard - and I think that will be enough to keep me busy for the next year or so! I was planning to run craft workshops from here anyway (residential or just for day visitors) and then perhaps I could have a small shop onsite, which could be open to the general public at certain times as well? If I advertise it well, then I am sure that people would make the journey out to the farm (when I lived in the Midlands I used to drive out to a shop based on a farm quite regularly) - especially as we are only a few miles from the main road and close to the sea. We also hope to have leisure facilities - spa pool etc - which could be an added attraction for residential holidays or day visitors. When I had my market stalls, I used to get people coming out to buy stuff on the days when I wasn't in the market.

Lots more to think about and research. Anyone on here with experience of running workshops/holidays?

Ali xx

Critchley
02-08-2008, 11:56 AM
I have had a couple of shops - not craft ones - and yes, the initial outlay is tremendous with insurances, rates, telephone lines, enough power points etc.,.
Considering your damp storage in the rear. If the landlord is not prepared to put this right it could also cost you an arm and leg depending on the cause.
Space for courses is an excellent idea. There are many tutors around looking for space so you get income from that plus the student always buy if you carry the right stock.
Presumably you will carry on selling on the net which you will have to do from the premises so need space for packing an posting. This you normally do from home but you won't be at home.
Put money aside for advertising - very important.
If you can afford it after doing your sums go for it or you will spend years regretting it.

doodles of Tadley
03-08-2008, 07:00 PM
:pc:Hi - I'm in the process of opening a shop so thought I' but in on this one! So far, it has taken nearly seven months, cost us in excess of 4,500 in legal fees and we still haven't completed! :mad: Just as well legal work isn't an Olympic event as I don't think our solicitor would qualify!!!
If you can get a shop for 10 a week then I am green with envy!!!!!! Ours will cost us 14,500 per annum, business rates will be nearly 6,000 per annum, and god only knows what electricity costs and insurances will work out at once we finally open ............
Not only that (you see what you've done?! Im on a rant now!!!!!) but the shop is in a terrible state - we don't even have a door as it used to be a supermarket which has got cut in half and we're getting the half that doesn't have a door, so we've got to put a brand new shop front in; we've also got to put in electrics, a new floor, decorate and completely fit it out before we can even start getting anything back for our investment, which is likely to be in excess of 35,000 once everything is done!!!!
Obviously, I am completely mad. If I was sane, I'd go and get a job in Sainsbury's or something.
:mf:Having said all that, it's the most exciting thing I have ever done, and we should (please pray, cross your fingers, kiss rabbit's feet etc) be signing the contracts this week and then we can start with the mammoth task of turning this unsed derelict wreck into the sort of art and craft shop that nobody with half an ounce of creative spirit will possible be able to walk past without wanting to come in and spend an entire week's wages on gorgeous hand crafted items.
If you have a dream, go for it! If you have a nightmare as a result, then at least you'll have tried!

Fluffy Squirrel
04-08-2008, 09:58 PM
If you have a dream, go for it! If you have a nightmare as a result, then at least you'll have tried!

I couldn't have worded that better myself!!

Chris W
05-08-2008, 08:46 AM
I own and run a freehold shop. My comment would be if you are hoping to make good money to put location as the number one factor. My business falls down because of my poor location, however because it is freehold, the rates are low and I run it single handedly I manage to make a profit. If you enjoy meeting people it is so much fun, it is definately the best thing I have done in my life. It isn't as physically demanding as you might imagine and many of my customers offer to do the shop for me to give me a break whenever I need one. At the present moment in time I wouldn't be keen to take on a lease but it is a great time to snap up a freehold if you have the funds. My shop is for sale as I am going to start an imaging business and I have reduced the price right down as commercial loans are difficult to get.

GlamGlass
05-08-2008, 05:12 PM
HI. Some great advice there.

I would also factor in the hours YOU would be working....what happens if you are sick???

Staff - wages, paye, accounts, etc

As for the location, I have to say, the farm that you live on sounds ideal, especially if you are making it a tourist attraction.

You could have workshops and the shop side by side that would complement each other and you can roll out of bed and into work!!

You are also around should your hubby need you, or visa verse.

I am sure with the right sort of advertising, the Farmhouse Craft Shop would work wonders!!!!
:mf:

sharon
06-08-2008, 11:14 AM
Hi
I think both premises have their pros & cons & need careful weighing up however I think you've come up with the ideal solution yourself without possibly realising it!!

The fact that you have arthritis & may not be able to man the shop yourself at certain times, having to employ staff which will eat into your profits (what if your member of staff takes ill at the same time as you having a bad bout of arthritis - will the shop have to be closed?). Hubby is thinking along the lines of having staff, so I don't think he sees you actually running the shop - he may still want you at home & is looking on this as just a hobby for you

I would go for converting one of your farm buildings into a craft workshop & shop. Hold craft days (say 6 - 8 people at a time for a day @ 70 -80 each inc lunch = 420-640, say 3 -4 days per month = 1260-2560 per month)
Have the shop open for 4-5 days per week + a website, hubby is happy as you will still be 'at home' & you'll be happy as you will have your work but will have expanded into teaching & running an outlet.

Overheads will be a lot less than having a shop in town & you'll be able to pick & choose your opening hours to work around your home life, & also to organise the workshop days around your time in Spain

Good luck

Sharon :)