adminWith over 150,000 convenience stores in America, there’s a clear demand for these one-stop shops. But to run one, you’ll need to take an organized and strategic approach to gain the most profits.
Curious to learn more? Read on to discover eight things you need to know about opening a convenience store!
1. Make a Business Plan First
Before jumping into any new business idea, you’ll need a clear roadmap known as a business plan. As part of your business plan, include a summary of your mission and goals. You’ll also want to lay out financial estimates, including revenue projections.
Research your competition, too, and explain how you’ll carve out a customer base. Ultimately, your business plan should be a concise and organized explanation of your intentions that you can share with potential funders. Make plans to review your business plan quarterly to see how you’re meeting or not meeting expectations.
2. Consider Location Options
To be successful, your convenience store should be in an accessible location. Ideally, you’ll want a place with good road visibility in a bustling area.
The area also should have the customer base you’ll need to get traffic in the store. For instance, you might want to situate yourself near office spaces or apartment complexes. Choose a popular area of town, too, so you don’t see dwindling traffic over time.
Consider whether you want to buy a building or lease a space. And regardless of what you decide, invest in clear signage. You’ll need to be obvious to drivers on the road.
3. Don’t Overlook Logistical Items
A new business requires obtaining several documents that enable you to run the business legally. Not completing or obtaining these items can result in fines or even the closure of your business.
For starters, you’ll need an employee identification number and a business license from your city. You’ll also need safety and occupancy permits.
Further, you’ll want to get business insurance to protect your store if it incurs damage. Failing to do this could set you up for some hefty bills that could put you out of business.
4. Prioritize Product Selection
Products are what will draw people to your convenience store. You’ll need to research what items are in demand in your area. Making your inventory more targeted will cut back on stagnant items that fail to sell and take up space.
Make a list of essential categories, like toiletries and packaged snacks. Then add other items, like makeup and cold drinks. And consider whether you want to provide hot food and medication.
Look at profit margins for different products. And see what your competition is not selling. You might be able to fill a void that helps distinguish your store from the pack.
Along the same lines, you’ll want to establish good connections with vendors. You’ll be depending on them to make timely deliveries to keep your store’s shelves stocked.
5. Plan on Equipment Costs
Before you open a business, you’ll need to have the right equipment for the job. At a convenience store, you’ll need at least one cash register and the means to process credit cards.
You’ll also need large refrigerators and freezers for food items. Plus, you’ll need shelving units to keep your inventory organized and accessible. These items can add thousands of dollars to your start-up costs.
If you’re planning on having hot coffee available, beverage dispensers are a must. And if you’re planning to sell lottery tickets, you’ll need the official equipment to do that.
Additionally, keep security in mind. Convenience stores can be easy targets for theft. Investing in mirrors and a proper security system can help avoid losses that hurt your bottom line.
6. Use Software to Stay Organized
Running a convenience store means overseeing lots of details. You don’t want to have lapses in inventory or expired food sitting on the shelves. A good software system can help you stay organized.
Choose software that enables you to track anything from sales to employee performance. With everything housed in one platform, you’ll be able to check quarterly profits quickly or file maintenance reports.
You’ll also be able to track progress and stay on top of inventory. And you’ll limit how much paperwork accumulates when all reports are digitized.
7. Be Prepared for Turnover
You’ll need a reliable roster of employees to make running your store easier. However, convenience stores and other hourly jobs often face more turnover than other types of positions. This is particularly true if you’re trying to staff your store during overnight hours.
As a result, you’ll need to be prepared to be looking for new employees regularly. And you might have to put in some long hours to fill the void at times.
It pays to have a clear onboarding program in place to maximize efficiency when you’re introducing new staff to your store. Equip new hires with the knowledge and customer service skills needed to earn return customers. And make sure they know how to card people for alcohol purchases or issue refunds.
8. Invest in Marketing
Lastly, one of the best ways to drive traffic to a new business is through marketing. While you can generally count on steady traffic at a convenience store, you shouldn’t assume you’ll get it right away.
Marketing can happen through how you present your team members and the store’s interior, too. A cohesive color scheme, professional name tags, and crisp signs can create a professional brand.
Consider using social media ads to generate interest. Take advantage of local news outlets, too, to reach your local audience. And look into offering incentives, like discounted products or freebies, to get people in the door.
Open a Convenience Store
Starting a convenience store can be a satisfying way to delve into a new business. But you’ll need to consider your location and upfront equipment costs as you map out a business plan. And you’ll want to invest in user-friendly software and marketing strategies to streamline operations and gain a customer base.
Learn more strategies to open a new business. Check back soon for fresh and informative articles!
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