A retail business

Thinking Of Owning A Business In UK?

A retail business
Retail business. Picture from: citytour.porhomme.com

Retail Business Advice.

We’ve all thought about it, a few have tried, many have failed.
Most of us have dreamt at some time of chucking in the job to start-up our own business. And often that dream takes the form of setting up a shop. It seems as though there is a shop for everything, and a lucrative niche to suit every potential shop owner. What’s more, you can be your own boss and move out of the city to a country town. It might be hard work, but for your own ends.
According to government records, there are now more new start-ups in retail than in any other sector, and perhaps surprisingly for a nation that had long regarded shop keeping as rather an inferior profession, a quarter of those taking the plunge come from managerial or professional ranks.
But, there’s a risk that setting up shop is becoming a sort of modern – day equivalent to seeing the streets paved with gold, a lot of people who’ve never been in retail think they’ll open a little shop. It looks easy, but many people get their fingers burnt. A lot of people have lost a lot of money.
I’m not advising people to steer clear of retail or owing a shop.
Everyone has seen the remarkable successes of Body Shop and a plethora of other new shops that have taken local high streets by storm.
But, it doesn’t alter the fact that 40 per cent of business start-ups collapse within four years – and the shop is no exception.
To succeed requires a more cautionary than cavalier approach, and however much you feel there’s a market for the products you wish to sell, a clear- headed analysis is paramount:
Is the market you’ve chosen large enough to give you a living;
• Who is the competition;
• What are the best profit margins you can achieve;
• How expensive will the right location be;
• Can you afford any staff or can you cope alone;
• Will you expand to achieve greater operating efficiency?
If you are after an easy life, forget it. The hours will be long; the weekends working.

DOS AND DON’TS
Do:

  • Think hard: why do you want to be self-employed? You must be ready to work very long hours running your own shop.
  • Take a course in financial management. Very important – VAT, PAYE, PROFIT AND LOSS ACCOUNTS, CASH FLOW, cash is the lifeblood of a business.
  • Research your market carefully. Who are your customers?  Is the market likely to change?
  • Draw up a realistic business plan; remember that profit is what you’re left with after paying for everything. Don’t forget your business rate, VAT if your sales is over £83,000 per year, minimum wage – it is criminal to pay any staff either full-time or part-time less than the minimum wage, National Insurance Employer contribution. Employer Insurance etc.,
  • Shop around to raise your cash. Interest rates vary widely.
  • Read your lease very well for rent reviews and rent increases, any buy out clause? The lease is a legal document so get the services of a competent solicitor.

Don’t:

  • Rush into it.
  • Borrow money to buy all the latest technology before you know it’ll work.
  • Sell on credits.
  • Rush into a property. Ask yourself why the other person is selling.
  • Above all prayer, prayer , prayer.

ISAAC NAMABIRI is a retired chartered banker and CEO – Helena’s Hair Care Ltd manufacturer of THE FUNMI HAIR BRAND IN UK. And CEO – Praise banquet Hotel

2 thoughts on “Thinking Of Owning A Business In UK?

  1. An excellent article Kole with sound and sensible advice for all who are contemplating going it alone.
    I’d add to this that it is essential to carefully consider the pros and cons of either taking over a going
    concern business or taking on a franchise or opting for a “cold start” venture.

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