How to Start a Retail Business?
If you’re considering launching a business in the retail sector, you’re not alone. Small retail firms make up the vast majority of all retail businesses in the United States, despite not receiving the same level of attention as national names.
To assist you, Brisk Logic will walk you through all of the processes required to start a retail business, as Brisk Logic will provide additional resources to aid you along the way.
In ten easy steps, Learn how to Establish a Retail Business.
You’ll be running your retail business in no time if you follow these procedures. Let’s get this party started.
Step 1: Determine your area of expertise:
The first step in learning how to start a retail business is to figure out what your company’s niche will be. You might already know what kind of business you want to start, or you might be trying to find out where to focus your retail business.
Brisk Logic recommends the following steps for determining your specialized market:
Investigate your passions and interests: Decide what you want to sell or what you enjoy doing.
Examine your Rivals:
It’s time to research your competition after you’ve established a niche market using the three procedures above. Determine what you can learn from them and how you can improve on what they have to offer by looking at how they market and sell.
Examples of Retail Businesses:
It can take a long time to find your niche. It takes extensive research and a strong desire to work in a specific market.
Here are a few retail business examples to assist you to get started in establishing your niche market:
Clothing stores eyewear sports apparel, undergarments, outerwear
Restaurants and bars decide on a theme, such as cuisine, small plates, or a canteen, for example.
Centers for games board games, video games, etc.
Step 2: Create a Business Plan:
Brisk Logic does not doubt that you have a fantastic retail shop concept, however, an idea isn’t enough to make a dream a reality. You’re giving yourself and possibly future lenders and other stakeholders a physical roadmap documenting every step you’ll take to launch and run your retail business by drafting a business plan.
As a result, you may begin writing your business plan for launching a retail store by answering the following questions regarding your business model:
However, keep in mind that your early business strategy is just that: preliminary. As you gain expertise with beginning and running your firm, you can always return to your retail shop business plan to make modifications, updates, and additions.
Create a Business Budget:
Along the same lines, you should also create a business budget, to the best of your ability, well before you’ve opened your doors. At this stage, you should be paying especially close attention to your startup costs.
Unfortunately, if you’re wondering how to start a retail business with no money, you’re going to find it’s extremely difficult. Although there are a variety of ways to cut costs—selling online instead of opting for a physical location, for example—there will always be a handful of costs associated with starting and launching your retail store.
This being said, in addition to standard startup costs like equipment, business insurance, and payroll, if you’re opening a brick-and-mortar retail store, you’ll have to cover some specific costs, like a down payment, potential renovations, and monthly rent and utilities for your store. You’ll also be responsible for purchasing your merchandise, shipping and delivery costs, and storing excess inventory.
Step 3: Register your Business:
With your business plan and budget in hand, you can now move on to the next step involved in learning how to start a retail business—making it official.
Come up with a Business Name:
If you haven’t already, you’ll first need to come up with a business name. Choose a name that reflects your business’s purpose and brand identity, allows you room to grow, and, perhaps most importantly, is available for use.
Once you’ve landed on your dream business name, run your moniker through a Google search to make sure another entrepreneur isn’t already doing business under that name. Then, check for trademark filings in the U.S. Patent and Trademark Office, and conduct a Secretary of State business search to make sure there isn’t another business in your area with your potential name.
Step 4: Obtain Licenses, Permits, and Business Insurance:
Some states require a general business license, while others require licenses and permits at an industry level. You may also need to acquire local permits and licenses, so consult your county or city clerk’s website for their particular requirements, too. The SBA is an excellent resource for licensing and permitting information at both the federal and local levels.
For those learning how to start a retail business, you’ll likely need to obtain multiple retail licenses related to your field, including a resale certificate, seller’s permit, and a certificate of occupancy.
Brisk Logic also recommends partnering with a trusted business attorney during this step.
Step 5: Find a Physical Location and Build an Online Store:
If your retail business will include a physical store, finding the right location is arguably the most important aspect of this process. Your location can make or break the success of your business: If you’re located in a heavily trafficked area, then your marketing efforts are practically built-in. If it’s in a tough-to-find location, or if parking is limited, then your bottom line might suffer.
Step 6: Establish Relationships with Vendors and Suppliers:
This is the next step to learning how to start a retail business—and beyond your store’s location, arguably one of the most crucial aspects of your potential success—is finding trustworthy vendors and suppliers. Your vendors might become your most valuable partners and a great vendor can present you with new merchandise, determine which products will sell best, and cut costs for you.
There are a few considerations to keep in mind as you’re searching for vendors.
Budget: Your vendors need to work within the supplier budget you’ve established.
Quality: The quality of their merchandise is crucial.
Reputation: You want to work with a supplier who is guaranteed to deliver your agreed-upon items on time and in good condition—every time you place an order.
Customer service: Remember that you’ll be working closely with your vendors, so their service team must be reliable, personable, and easy to contact in case you run into any issues.
Brisk Logic recommends establishing relationships with several vendors. Even if your vendor of choice is stable, reliable, and cost-efficient, you need to have a contingency plan in place without merchandise to sell, you won’t have a business to run.
Step 7: Hire staff:
If you’ve never hired an employee before, take a look at our guide on how to hire great employees who’ll stick with you for the long run. When hiring for a retail position, make sure to interview as much for their attitude as you are for their experience. While you can train your employees to use your POS system and manage your inventory, you can’t teach them to be kinder, friendlier, or more trustworthy than they innately are.
In advance of hiring your first team member, make sure you understand your state-regulated employer requirements. Your state might require that you buy certain types of insurance for your staff. Additionally, you’ll probably need to complete some other steps, like creating a state withholding account for payroll, reporting new hires, and verifying your potential new hire’s employment eligibility as well.
Step 8: Find the Right POS System:
Your POS system just might become your retail business’s best friend. It’ll certainly become your employees’ best friend—assuming you choose an intuitive, easy-to-use model, of which there are tons on the market right now.
A point of sale system combines hardware and software that enables your business to accept and process all kinds of payments. Most POS software is loaded with valuable back-end capabilities, like inventory management, employee management, CRM tools, sales reports, and vendor tracking.
If you’re opening a brick-and-mortar location, you’ll need a POS system that can accept cash, checks, contactless payments, and both chip and swipe cards. In addition, you’ll need a barcode scanner, receipt printer, and cash drawer.
For more flexibility, you might want to look into a POS system that allows on-the-go payments, too. For example, Square (and most other POS systems) has mobile card readers that plug into your phone or tablet so you can accept payments from virtually anywhere, whether that’s at a pop-up shop, craft fair, or trunk show.
Similarly, Clover also has a fully equipped, handheld POS device so you or your staff can ring up your customers from anywhere in your store.
Ultimately, you have options—a lot of them. To help you navigate the selection process, consult our guide on the best retail POS systems.
Step 9: Organize your Finances:
As Brisk Logic mentioned earlier, it’s nearly impossible to figure out how to start a retail business with no money—so, whether you have a large amount of startup capital or are operating on a tight budget, it’s extremely important to organize your finances.
First, you’ll want to open a business checking account. If you’re happy with your current bank, you may want to open a business bank account there. It’s logistically easier for you to maintain all your finances with the same institution. In addition, many banks offer discounts and other incentives when consumer clients open business accounts. If you want to compare your options, Brisk Logic recommends looking into our best business bank accounts guide.
Next, you’ll want to get a business credit card. Most credit card companies allow business customers to apply for a business credit card online—which makes this step even easier than opening a business bank account.
If your business is too new to have any financial data, you can provide your personal financial information on your application. If you’re approved, you’ll receive your card in the mail in about a week or two. Use it for your business’s smaller, daily expenses, and be mindful of only using it for business-related purchases to maintain personal and business financial separation.
Most entrepreneurs need a little (or a lot of) financial help to get their businesses off the ground. That may be especially true of retailers and brick-and-mortar business owners, who have a few extra startup costs to contend with.
Step 10: Market your Retail Business:
At this point, you’ve learned the most important pieces of how to start a retail business, and now, you’re ready to open your doors and get to work.
Of course, to get the word out about your business, you need to develop a small business marketing strategy, which provides you with an opportunity to get a little creative. The best marketing strategies, especially for brick-and-mortar stores, use a combination of SEO, social media, email marketing, paid online marketing strategies (if their budget allows for it), and analogue marketing efforts.
The Bottom Line on Retail Business:
As you navigate the business formation steps, be careful not to lose sight of why you’re opening your retail business in the first place. If you remember the passion that inspired you to launch your business, you might even enjoy the finer points involved in the process—who knew finding a POS system could be so fun?