Is it profitable to Open a Store?

Opening a new store is a costly and troublesome business, so many investors are wondering how profitable to open a store? There is a time-tested technology of literally opening a store in order to ensure a stable and high revenue in advance.

Step One "Business Idea"

A business idea is a unique commercial idea, the concept of your future retail business, a guarantee that it will be profitable to open a store. Until now you can see a lot of gray, faceless stores like "Products 24", "1000 trifles", "Fishermen". These stores have the same range, roughly the same price, poor service. In conditions of severe competition in all spheres of trade, only the store that offers a bright, interesting, notable idea will be successful.

At the core of the business idea should be factors that are valued by future buyers. In the case when you have already decided on the placement, in order to identify such factors, usually to conduct a small marketing research of buyers and competitors, following which you develop the core of your business idea. The price of the research depends on the scale of the work and the individual specifics of the order, but approximately the amount in the region of 40,000 rubles can be called. If you do not decide on the placement, you lay down the success factors yourself, and select the premises strictly according to the business plan.

Step Two "Detailed Business Plan"

A commercial idea for business must necessarily be transformed into a business plan. Here is an approximate enlarged business plan structure:

1. Introduction
2. Marketing information
3. Technical requirements for premises
4. License requirements
5. Budget for non-recurring investments
6. The budget for current investments for a period of 1 year.
7. Calculation of the recoupment of the project.

In the introduction it is recommended to give general information on the business idea. Marketing information is needed to work out the issue of future trade revenue, the issue of the gegraphy of the shopping district (if you have not already chosen the premises), the questions of fitting the business idea to the shopping area (if the premises have already been selected), and a list of competitive advantages. This section is written on the basis of the above study.

When calculating both budgets, it is necessary to take into account the level of minimum required investments. For example, for a deli with a sales area of 100-120 sq. M. Such a budget at the opening will be 3-3.5 million rubles. Take into account everything: rent and deposit for rent, repair, purchase of equipment, obtaining licenses and permits, buying goods, developing, manufacturing and registering a signboard, an advertising campaign at the start of the project will also require money. In current investments, it is necessary to take into account utility payments, compensation for PHOT in the first 6 months, advertising support, overlapping of various losses.

When calculating the payback, put the probable revenue, taking into account that the first 6 months of revenue will gradually increase from zero to the planned figure. The revenue forecast is usually made with the above mentioned study. If your payback period is less than 1.5 years, then the store can be safely opened. If the payback period exceeds 1.5 years, then you need to choose either another room, or else work out the business idea.