How to Open a Convenience Store
By Rory Singh
How to open or start a convenience store. This type of business is always in demand because it offers conveniences to customers. It also performs well even during times of economic downturns like recession. With that being said, it is still an entrepreneurial venture that needs to be thoroughly researched before taking any action. Failing to take the following steps can result to failure or poor financial results:
1- Business Plan:
Contact a lawyer who specializes in this field to draw up a professional business plan.
Most financial institutions will not grant you a business loan unless you have a lawyer approved business plan that makes sense to them.
Contact your local government agency that deals with vendor permits and incorporations for detailed zoning and building requirements. Find out what kind of requirements that your perspective retail store will need to comply to such as:
- Commercial and residential zones
- Square footage
- Number of customers that your estimated square footage can handle safely at any given time
- Food and water safety regulations
- Fire extinguishers and other safety supplies like first aid kits
- Number of exits in case of fire or other emergencies
This type of business offers customers a convenience of supplying a need mainly for impulse buying. People tend to drop into convenience stores on the way to work or home. They usually buy from this type of business when they are short on time or when their super market of choice is closed. The best location would be near highway exits, main streets and even in large residential areas. Most grocer associations will require that a store must be located one mile away from between 500 to 1000 potential customers. Make sure that there is enough parking to accommodate perspective customers. The more convenient your location is, the better your business will do.
Do a market and residential zoning research to determine if your perspective area can accommodate another business of this type. Find out if there are any local expansion plans to build additional homes in this area. Your main competition will be from other convenience stores and even larger grocery stores close by. If there are large grocers near by then your peak business time will be outside of their normal operating hours of business. If you are planning on running 24 hours,
then you will still need some kind of expectation of customers between the hours of 8 pm at night to 10 am in the morning (when larger grocery stores in your area are most likely closed).
Find out what kind of shelving, counters and fridges ETC, that you will need to get in order to run a clean and safe operation. Figure out if you are going to purchase new or used equipment.
You will have to establish connections with food and beverage suppliers. These suppliers have their own application process that you will have to go through in order to qualify to purchase products through them. Once you have established suppliers, they will be responsible for keeping up with your regular orders by delivery truck. You can also purchase supplies like tobacco, food and beverages directly from bulk cash and carry suppliers. These types of suppliers are sometimes cheaper than others since you will be required to provide your own pick up and deliveries. Most convenience store owners have a balance between the two types of suppliers in order to stock their stores and keep costs down.
7- Advertising and Promotion:
If you are in an area that is easily visible to the general public in your area, then you will not need to do much advertising. However, if your store is in a hide away, you will need to let perspective customers know that your business exists. Advertise by flyers and newspaper grand opening announcements. Establish a webpage or website to provide all of your company details. Contact your local community website (most small communities have them nowadays) and see if you can place a free or even paid add in the site.
Always keep in mind that word of mouth is always the best way to build a business. If you can provide your customers with quality, affordable prices and great service, you will never be short of customers. All business in every industry is based on building relationships.
The better the relations you build and keep with customers, the better you will do, and keep doing.
8- Franchise or Not?
Many convenience stores are now being operated by large franchise corporations. You will have to weigh the pros and cons of choosing a franchise or starting from scratch. Franchises will take care of all of the steps above for you which can be very convenient. However, anything that is convenient in life does have its costs. To start up a franchise you may need from $250,000 to $500,000 with $100,000 liquid cash in hand (individual franchises will vary). Starting from scratch will carry a lot of leg work but it can be a lot cheaper to get up and running with estimates of $30,000 and up depending on what type of area your in.
About the author:
Rory Singh is an Internet Entrepreneur and Investor.
Here is a business that has a lot more profit potential than a convenience store. Best of all; you can get up and running with a fraction of the cost!
Visit: http://www.networkopportunities.net/biz.html today!
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