If you are wanting to enter the world of retail as a small business owner, you are in good company. Small retail businesses have been growing in America for several years and in 2021 there were 32.5 million of such ventures. The world of retail, like the world of business in general is highly competitive, but a successful retail enterprise can make substantial amounts of income and can provide a valuable service to the local community. If you are looking to start a retail enterprise, there are some key facts to consider first. In this article three of the most important considerations to decide on before you enter business will be discussed.
The 4 P’s
As any business student will tell you, the 4 P’s concept of marketing is an old but highly effective way to plan your business venture. It can be broken down into the following sections:
Product: You must ensure that there is suitable demand for the product (or range of products) that you are selling in the local population. The demand should be long term rather than fad based. Clearly there is little point in setting up a shop selling fidget spinners when the craze was short lived and has passed. Put simply there must be steady, long-term demand for what you plan to sell.
Price: Your products must sell for a price that your potential customers will be prepared to pay and must be competitively priced so that you are not undercut by any competitors selling an identical product. If you are selling at a price higher than your competitors you must be able to differentiate on quality or features to justify the price.
Place: Choosing your shop location is integral to your retail success. In short, the land rental prices must be low enough to allow you to generate profit, but you must be in an area with a high footfall of potential customers.
Promotion: Marketing activities must be designed to drive custom to your premises and raise awareness of your business venture in the beginning. Introductory offers are great ways to gain a strong customer base in the beginning of your retail operation along with regular promotions and sales.
Funding your business
In the initial stages of your business, you must ensure that you have sufficient capital to buy stock and purchase your retail outlet premises. It can be wise to research private money lender services such as those offered by Sachem Lending. Such organizations can provide a range of short-term loans that can give you the capital to fund the purchase of your premises and get your business up and running. When it comes to finances for your retail business, you should have clear expectations of your projected revenues and costs incorporated into a comprehensive business plan.
To Sum up
When starting a small retail business, it makes sense to ensure that you have access to sufficient funding to enable its inception and first stages of operation. You must be certain that there is sufficient demand for your products or services and that you are pricing them to be competitive with other similar firms in the locality. The location of your premises is vital to ensure that you attract sufficient customers who are likely to be interested in what you are selling. Promotional activities should drive customers to you and be an integral part of retaining them long term.