| Fully understanding the costs before you open a retail | | | | Employees: hiring costs, uniforms, training and any other |
| store is important to being financially prepared for the | | | | sign-on costs. |
| road ahead. While some retail store start-up costs are | | | | Opening: marketing, promotional gifts, advertising, |
| obvious, others are not. The key is to develop a | | | | additional employees for any event. This needs to |
| comprehensive business plan and budget which take | | | | cover all costs to support any opening event as well |
| into account all possible start-up costs. This is best | | | | as marketing to be undertaken by the business for the |
| done by people connected with the business as well | | | | first three months of trading. |
| as external advisors who have experience in the area. | | | | Early trading: budget for the cash necessary to pay |
| Here is a list of retail store start-up costs which will | | | | the bills of the business which it is establishing itself. |
| apply to almost any type of business. The list is broken | | | | This will depend on how soon you expect revenue to |
| down by area: | | | | kick in. Budgets for between three and six months |
| The store itself: lease preparation costs, legals, shop-fit, | | | | coverage. |
| signage, electrical, lighting, plumbing, parking, window | | | | Contingency: once you have all of the expected costs |
| signs. In developing these costs, get quotes from a | | | | worked out, add a line for contingency - for anything |
| range of suppliers and use the higher quotes for | | | | which may go wrong. As a guide, this should be in the |
| budgeting purposes. | | | | vicinity of 10% to 15% of the total start up costs. |
| Stock: initial floor stock, backup stock. Make sure that | | | | The more accurate the cost assessment the better |
| you have ordered enough stock to support the | | | | prepared you will be should the business plan proceed. |
| opening of the business, to fill the space and have | | | | A retail store starved of cash is a business waiting for |
| enough to replace stock as it is sold. | | | | all sorts of challenges. This is why deciding not to |
| Infrastructure: computer system, security system, | | | | proceed because of lack of cash is better than just |
| motor vehicle(s), phone system. | | | | scraping through and opening with barely enough cash. |
| Other: business incorporation, accounting fees, other | | | | Take your time and work out what the real start up |
| legal fees, any government registrations necessary, | | | | costs are likely to be. This time spent before you sign |
| initial supply of stationery and consumable items, | | | | any agreements could be invaluable down the track |
| insurance, banking relationship setup fees. | | | | even once the business is open. |