Answer by Syama Meagher:
Here are a couple things to think about when starting one’s own retail store – brick and mortar
- Demographics: How much money does your demo make? What are their needs? Preferences? What other options do that have to shop similar products to you?
- Location: What competitors are in your neighborhood. Its great to position yourself next to other businesses that will drive traffic to your store. If you are the only store in the neighborhood- ask yourself- WHY?
- Product: Choose the right product based on your customers- not on what you want. Know that what you carry in store today might be different 6-12 months from now once you know customer needs. You are testing.
- Pricing: Don’t just look at what you can markup a price based on keystoning (x2) or the desire to have a 60-75% margin. Price yourself competitively.
- Inventory Management: Get a good inventory management software- saves you time and money.
- Vendor Negotiation: Begin sourcing product ASAP. You need to see what is available, look at shipping options, delivery timelines etc. This takes time. Vendors will have their MSRP, and know that the best brands might give you the smaller margins simply based on demand. Fashion markups can be anywhere from 20 > 75%.
- Consignment + Traditional Buys: Consignment is harder work with as the inventory liability is still with the vendor. If you have no proven record of sales than how do they know they can actually sell product through you. Traditional buys put the responsibility on the retailer.
Don’t forget ecommerce…Goodsie () Storenvy ( ) and Shopify ( ) As you build out a multi revenue stream approach.