What it costs to open a retail store gas efficient suv 2015


Costs that you didn’t plan for will certainly pop up as you prepare the store for opening. Many of these oversights will be small, but some can be large and they can all add up, possibly affecting your success in the long run. You can prevent these surprises by being as thorough, accurate, and realistic as possible. Basic Startup Costs

Your list of startup costs should involve everything that you need to open the doors, keep them open, and plan for the future. Sit down and brainstorm every single expense that you can think of—right down to the toilet paper for the bathroom—then start researching how much each line item will cost.

• Licensing and permitting fees. These include numerous licenses and permits for things like an Employer Identification Number (EIN) for tax purposes, state and local licenses as indicated by the SBA, a Resale Certificate (if you’re not selling exclusively independent products), a seller’s permit, and a certificate of occupancy. These costs can vary from $200 to $2,000 depending on your business and the state in which you’re operating.

• Initial inventory. You need to be fully stocked with inventory on opening day and enough product to last at least four months. If you don’t know the exact prices, use an estimated markup assumption to back into the rates you’re likely to see from your distributors. For example, if you know the sweaters you want to sell normally retail for $20, you can assume that with a 25 percent margin, you’ll be able to purchase them from the manufacturer for $15.

• Equipment and technology. Essentials such as point of sale (POS) systems, computers, web access, televisions, mobile payment platforms, and other IT expenses are not cheap. POS systems cost around $2,000, with an additional $550 for each workstation. Televisions may be $300 to $500 each, while web access can cost $100 or more a month.

• Web hosting. If you want a website, you need a website builder and a host to keep it online. Free builders and hosts are available, but their capabilities are limited and may reflect poorly on your brand. Instead, expect to invest a minimum of $30–$200 a month for a website.

• Janitorial supplies and services. If you choose to hire a cleaning service, you can expect to spend between $50 and $200 a week, while personally handling cleaning in-house will likely cost $500 to $1,000 for an initial investment in supplies and heavier equipment, such as vacuums.

• Interior decor and aesthetics. You may need to paint the walls, install shelving, add a counter, replace flooring, and make other changes. While some fixes can be handled independently, bigger projects may require a general contractor at a rate of $50 to $100 an hour, in addition to the cost of materials.

If you are an entrepreneur, then you will most likely want to pay yourself a salary to run your store. Don’t forget to include this cost, but you should only pay yourself if you are physically working in the store. There is rarely enough money in a retail startup to pay the manager and the owner. Borrowing Costs

Starting up any kind of business requires an infusion of capital. The two ways to acquire capital for a business are equity financing and debt financing. Usually, equity financing entails issuing stock, but this approach does not apply to most small businesses, which are proprietorships. For small business owners, the most likely source of financing is debt that comes in the form of a small business loan. Business owners can often get loans from banks, savings institutions, and the SBA. Like any other loan, business loans are accompanied by interest payments. These payments must be planned for when starting a business—the cost of default is very high. What Will Your Store Cost to Open?

A grand opening event can ensure you gain exposure in the community, guaranteeing a steady flow of customers on your first day. You can invest nothing in your grand opening. On the other hand, on the high end, you could allocate 20 percent of your first-year marketing budget or no less than $6,000 to the promotions and advertising materials that go into this pivotal day.

Whether you hold a grand opening or not, with 98 percent of all businesses in the U.S. qualifying as small businesses, with the right planning, you’ll be joining a huge community of entrepreneurs that have shown that with the right planning and hard work, you can have the American dream.