Help please - where do I start and is this a good idea?

paulwf

Colin2511 wrote: »

this worked very well in Harrogate, the shop was near the maternity hospital. - if you have the nurserys close by it could work with a little marketing to these.

Opening near a maternity hospital sounds like a stroke of genius, a constant supply of new customers. My concern with nurseries is although they may be busy is it the same 30 children every day? (Genuine question, I have no idea). Long term what would happen if one of the nurseries closed or relocated? Again, genuine question as I have no idea how stable the nursery industry is.

To put it in perspective although my town is only small to mid sized it has a high shop occupancy rate, party because the tourism trade and local colleges brings in a fresh influx of customers, you aren't marketing to the same people day in day out.

Although having a low rent is good you also need to balance it against your footfall, you are going to need to attract customers from a lot more than a couple of nurseries to survive. Do a simple calculation, if you want to earn say £15K a year and your average net profit per sale is £5 how many customers do you need? Obviously adjust the figures depending on your research, but you will need a few thousand sales per year just to stand still!

This forum is great to bounce round ideas, but it's also easy for people to go with the flow and just give supporting answers so I wanted to give the other side as well. I think your idea could work but it also needs to evolve a lot and needs a very stable foundation, both in terms of finances and business skills. Perhaps you could look at a 5 year plan to get there? Sort your debts out and do some retail work, preferably in the industry (a job in Mothercare would be ideal) or at least in retail. It looks like you haven't done any retail work for a long time so even doing it for a year would be a great help.

Also be very honest with yourself and work out exactly why you want this business. I don't want to get all Freudian but is part of it you thinking that instead of having a baby you can be in a shop surrounded by babies all day? A passion for the industry you work in is a must, but your primary reason for entering that industry must be because you think you can make a large profit from it.

cally6008

bailey59 wrote: »

Savvy_Sue I wouldnt sell second hand prams, cots etc, just clothes. I maybe thought of getting a supplier that would give me a discount and then ordering items from them, maybe have a catalouge in the shop that people can look through?

If people are just going to be looking through a catalogue in your shop, whats to stop them getting your suppliers name and going to them direct thus cutting out the middle man (you) ?

eschaton

Look at costs involved for reality before anything else.

Rent/rates for shop - how much?

Kit the store out - f&f aren't cheap. Fascia sign - simple ones aren't cheap.

Maintenance, insurance, loan repayments, cost of stock in hand, staff cover, shrinkage, heat & light costs.

I'm sure if you look into your plan in any detail you will find it's a non starter.

Someone suggested a job in Mothercare - good idea to build knowledge.

AHZB

My family is in a similar boat where I was made redundant last year.
I am currently looking for standard employment but my wife was wanting to startup her own business for some time but we didnt have the money. So some of the redundancy money has gone to starting up her own small business.

She didnt know where to look at first but then found the following site which gave her all she needed to startup. It explains in details how to setup a business plan and methodicaly plan out what you need to do and how to go about it.

www.bgateway.com

She is now up and running and making a good profit.

Also you say that you were made redundant. Whilst I have been off I have been trying to keep busy and am in the process of starting a Redundancy Cooperative to help people like us get back on out feet. If interested give me a shout

BUT whatever you do . . .DO check out the Business gateway site . . .my wife swears by it.

good luck
Anthony

bailey59

cally6008 - If I arranged the discount with a supplier via my shop surely the customers purchasing one thing from them wouldnt get the same discount as my business?

paulwf - Maybe they are the same children every day but I thought I could hand out leaflets at the local nurseries/schools to make people aware of where I am? Unfortunately there would be no way to open a shop near the maternity hospital as its just surrounded by houses, no commercial properties.

eschaton - the only way I could even think of starting this up would be a loan from my Dad. That would have to include money for sign, f&f's, stock, leaflets & marketing etc. Then just as a rough calculation, rent £350pm includes all heat & light, my wage £1000pm, insurance £90pm? have no idea how much PL insurance is. Then there is phone line, dont know what shrinkage is or cost of stock in hand? So say £260pm misc? Then I would need money to re-stock. So as a very very rough guide £2000 pm net. = £461 approx pw. So if I was open 6 days a week thats £77 per day. Which is why I need larger items to sell otherwise thats a lot of pens, book and clothes to sell. Dont forget please this is just an idea of mine and I appreciate all your advice but please dont laugh at my estimates, I wont pretend I know what I'm talking about thats why I'm on here to learn about trying to set up a business and get your opinions.

What about instead of a shop I try a market stall and work my way up??? We have a good large Saturday market. I know I'm downsizing quite a bit from my original thought but maybe instead of going all guns blazing I could start on a smaller scale?

moneypooh

Perhaps a website linked to your shop would give you a broader outlet?

eschaton

bailey59 wrote: »

What about instead of a shop I try a market stall and work my way up??? We have a good large Saturday market. I know I'm downsizing quite a bit from my original thought but maybe instead of going all guns blazing I could start on a smaller scale?

Certainly less risk than a shop. Also ideas of ordering from a catalogue - I wouldn't do it, I would want to see something.

Also discounts from supplier - they would give a discount based on volume sales, they are not going to offer discounts based on the chance of an order here and there. Also - is there a catalogue in the first place ?

paulwf

Selling from catalogues can work if you have a range of that brand already in stock. Or it is a niche product and no one else stocks it. However most customers are fickle and will just drive up the road to a store that does stock what they want.

Maybe they are the same children every day but I thought I could hand out leaflets at the local nurseries/schools to make people aware of where I am? Unfortunately there would be no way to open a shop near the maternity hospital as its just surrounded by houses, no commercial properties.

Good thinking, forging links with your local community is a really good idea. At the end of the day though strong footfall is still very important, especially as you are selling fairly low end generic goods (sorry for being blunt) so aren't really a destination shop. There is a real "theme" on this board that people look for the cheapest possible premises in the most out of the way areas, I have no idea why this is.

Re: your figures OP. You can get 5 year plan templates from Business Link and they may also have startup figure templates, post a separate thread if you like to number crunch in a little more depth. I'm concerned about your wage bill, you will need holiday and sickness cover plus 6 day a week working isn't ideal. There's also no point in investing so much time, money and risk in a project for a return of £10K a year before tax!

The market stall is an excellent idea, any good business plan relies on market research and a pilot project like this would be ideal. It is also low risk and could be combined with a full time job so suits your current circumstances.

bailey59

If I went down the market stall route to begin with do you think 2nd hand clothes would sell on a proper market? Or would I be better selling new clothes? If second hand what sort of money do you think I could charge as I'm guessing for 2nd hand it would be a lot less. And do you think if I did a Saturday market I could then do a Sunday car boot? But car boots seem a bit more ruthless than markets, everyone seems to want to pay a lot less on car boots. Does anyone have experience of markets and car boots stalls?

Paul thanks for your help and sorry to be dim but what is footfall, you have mentioned it a couple of times and I dont know what you mean. And what exactly is a destination shop? I still could hand out leaflets or some sort of marketing campaign to market the stall.

I agree thought that perhaps a stall incorporated with a full-time job would probably be better suited to my financial and personal situation nd also lack of experience.

eschaton, if possible would you mind telling me how you started and grew in the retail industry? I'm not trying to do a get rich scheme I just want an opportunity to try something I have always wanted to do.

cally6008

footfall = the number of visitors your shop is likely to get (or the number of people passing your shop that might be enticed to enter)