Any One Ever Work In Retail?

[iLander]

I've never worked in a shop, but I'm considering opening a small gift store as a retirement "job". I have no idea what the figures would be, so even if you've worked for a giant retailer, I'm interested in hearing what you have to say about it.

What does a store gross in a typical day?

What days do you get the most customers?

What's considered a decent profit?

Would you do it again? Why or why not?

 

[Dee*Jay]

iLander, I think the answer to some of your questions will depend on:

What type of store it will be? I.e., what will you be selling?

Where it will be? (I'm not necessarily asking what exact location, but generally will it be in a "downtown" area that is walkable to the working public or will it be somewhere that people need to drive to; will it be in a "strip mall" sort of setting where there are other stores [and preferably a grocery or anchor store] to attract customers for other reasons; that sort of thing)

This sounds very interesting and I'm excited for you!

 

[VRBeauty]

I worked in retail for about one month - in a high-ish end department store. Suffice it to say constant customer service is not for me. (It probably didn't help that this was during the holiday season, so I was subjected to the same loop of holiday music over and over and over. )

Owning a retail store is a different proposition than just working in retail, though - in the sense that it's all that and more. One resource you might consider is SCORE, the Service Corps of Retired Executives. This group exists largely to help small businesses and people who are considering starting their own business. The SCORE group in my area offers both comprehensive classes and one-on-one meetings.

Good luck!

 

[aviastar]

I've never worked in a shop, but I'm considering opening a small gift store as a retirement "job". I have no idea what the figures would be, so even if you've worked for a giant retailer, I'm interested in hearing what you have to say about it.

What does a store gross in a typical day?

Completely depends; I don't have a lot of daily consistency. My monthly totals always seem to work out, but no two days are ever the same.

What days do you get the most customers?

Saturdays. Then Sundays and Fridays. But there are the random, crazy Tuesdays, too. Almost everyone in my local mom and pop shopping district is closed on Mondays.

And December, every day.

What's considered a decent profit?

Again, this is heavily dependent on your product. When I worked in restaurants 1-2% was what I heard. That sounds low to me for actual retail, but then again that 1-2% was over a million every year, net, which *ahem* I am certainly not hitting. I friend of mine works in sporting goods and he said he can mark small things like gum up at a higher percent than the big ticket shoes.

So for me, the decent profit is when I'm in the black and the black is enough to let me take care of my family comfortably. That number and what percentage it is of the gross is going to vary widely across industries and geographical locations, and truly year to year.

Keystone, or doubling the wholesale cost, is pretty standard, as is triple key, which is tripling the wholesale cost, for pricing. It gets trickier if you are working with small producers. I work with local craftspeople and artists; there isn't really a wholesale cost, just what they need to get from the piece, what I need to get from the piece, and what the market will bear. Then we do a little dance until it has a retail price.

Would you do it again? Why or why not?
'm doing it now . I don't see myself ever doing anything else; mostly because I don't think I could ever have a boss again. I love the creativity, the empowerment, and the joy when it all works. I love the very nice people I get to meet and work with; they are the overwhelming majority. I love working with my husband; not everyone can say that, but I do. I don't love the 24/7 time commitment or the worry when the month is lean. I don't love the snotty, crazy customers who you just can't please to save your life; this is not the norm, but it is a reality of retail. It happens and you have to be prepared for it. This is my husband's and my sole income- we're in it for good. There is a wonderful lady with a shop near ours who has retired from one career and now does this with her daughter. She's able to be much more relaxed about things because it's not her sole income; she has a pension and her husband still works. If you could do it like that I would say go for it, but if you're looking to start up something brand new and have it put food on the table it won't be...relaxing. Rewarding, yes; relaxing, no.

Location has been absolutely key for us. Malls are too expensive for mom and pop places, but you need the critical mass of foot traffic to make it work. We've been very lucky that our locality has a vibrant district of all mom and pop places, no chain restaurants, lots of local goods. And the landlords all own one or two spaces so the rents are reasonable and not determined by 'corporate', but my our neighbors who want the district to thrive. The location has been a gift, a real gift.

The next most important thing has been our signage and our decor. Get a pretty sign and make sure people can see it. Sounds basic, but far too many businesses don't do it. Make the shop inviting and pretty, spend time on the product layout and your gift packaging. Presentation matters.

So there's my rambling thoughts while trying not to include super identifying info about my business. Happy to discuss or answer anything I can!

 

[pinkjewel]

Going back many years, my Mom and I opened a higher end women's boutique and had it for about 15 years. Most of your questions are difficult to answer as it varied so much. We had our store during the 1980s and early 1990s which was a wonderful time to have a store. We were quite profitable even from early on. Women's clothing is usually a keystone markup with many vendors also giving 8/10 eom terms. We also had a small gift section in the store. That section was much harder to make a good profit on. Very few vendors gave terms except net 30. Many wanted COD even though we had impeccable credit. I think a gift store would do well depending on where you were located. In my area so many discounters have taken over the gift industry, that most gift shops have gone out of business.

If you decide to open a store- make sure you have a large working capital. Most shops that fail don't have enough capital behind them. What they say about location, location, location is sooooo true. It's best to pay a bit more for rent and be in an excellent location. Make sure your decor is attractive and that your employes are friendly, and offer pretty free gift wrapping. Our best days were generally Thursday, Friday, and Saturday. We were not open Sundays or evenings.

I loved our shop for about 13 years. We travelled everywhere on buying trips-including Europe. It was sooo much fun. Sometimes we'd have the irritating customer or the funny regular customer who would come for psychiatric advice once a week- after all, we were a captive audience-lol. But- it was 24/7 for us. Whenever I wasn't at the shop- I was thinking about the shop. I never took a vacation (the buying trips were the only time I got away). I got burnt out and felt I needed a life. That's when we decided to close it.

So, would I do it again? Probably not now- but I wouldn't trade my experience of being a retailer for anything. I've contemplated working in a jewelry store part time- but don't want the responsibility of owning a store anymore.

eta- forgot to add that the first year we opened we grossed around 350,000/year and towards the end we were grossing close to a million or a little over.

 

[woofmama]

Great reply by aviastar! I also own a retail store. It's a ton of work, the first two years I worked every weekend & six days most weeks. Now I take an occasional Saturday off and every Sunday as well as a mid week day. My business had to be a success, I have always worked, I was in several well paying sales jobs prior to this and my family depended on my income.
We opened in 12-08, and have consistently grown every year. I have now outgrown my space and am looking for a larger store front.
It is very rewarding, I love my customers, have had a few challenges with staff but overall it's turnkey.

I went to SCORE for consulting prior to opening. Very helpful with writing my business plan. I was able to secure two SBA loans to help cover my build-out. I also joined as many professional organizations as I could relative to my field and subscribed to all of the trade publications.

Five years later we are solid and healthy. There were a lot of bumps in the road but opening at the height of the economic downturn was a big risk. My husband has continued to work but the business income meets or exceeds his income. We keep his job for benefits and household expenses.

I highly recommend http://www.whizbangtraining.com/
http://www.retaildoc.com/
http://www.retailmavens.com/

Whiz Bang speaks at most of the gift shop retail tradeshows nationwide.

EDIT TO ADD: pinkjewel posted while I was writing so I want to comment, very true about the always on duty. I pretty much never stop thinking about work. Also have only taken two vacations in five years. But I still enjoy my career. Sounds like pinkjewel had a very nice business I'll be keeping our store for at least another 10 years. Then either close or sell and retire.

 

[minousbijoux]

Great thread and a wealth of experience here. WoofMama, Pinkjewel, and Aviastar, I have profound admiration for your self-confidence, hard work and courage. It sounds like you all deserve the success you achieved.

 

[facetthoughts]

hey hello,
I have been involved in the gemstone trade for better than twenty years , and i thought to post a reply to your questions
I have a true love in working with tourmaline and have found in the most recent time period that this gem is becoming almost impossoible to obtain , 2 years back it was fairly able to be obtainded in the meriod of colors that mother earth has created..
- well to your questions , some need an objective answer - but putiing together a small shop is and should be everything you want it to be , the customer base requires a fair amount of advertizing , and getting people interested in what you have to offer , personally i found that if you can offer items that are quit unusual and of great inteterest to almost every one when it comes to bling , you will build a reputation for the fine and unique , as to the profit margine you have to work out a budget and than to make sure that you find a balance in the price of your items , that will be atractive to your potential clients and will allow you to be able to offer new items and yet cover what is considered you opporating costs , i have found that this is an artful talent that can only be learned with gaining feed back from your customers and what their spending budgets are , and than to get creative with how you might make items you offer
financially attracive for them to make that buying descsion , and as time moves forward you will be able to create a more attractive
balance between you and your potencial clients...
larry of facetthoughts

 

[sugarpie honeybun]

Full disclosure: I am not an attorney!


As someone who works in retail REAL ESTATE, I can only offer some insight from my professional perspective.

Assuming you are planning to lease a space for your business, you will want to create a shell corp to shelter your total income, and protect your personal assets (i.e. personal property, automobiles, etc). If the landlord insists on some form of an additional guaranty, I would recommend a security deposit or even a rolling personal guaranty, equal to no more than 6 months rent (the average length of time it should take a landlord to replace you with a different operation).

I also advise you should include some lease language that protects you in the event your sales are low. For example, if after your 3rd lease year, your sales don't exceed $XXXXX (this should be your break even point in the 3rd year), then you have a right to terminate your lease.

There are many, many, many other suggestions I could give - these are just the basics.

Good luck!

Sugar P.

 

[JulieN]

Some questions:

Do you think you'd like working in retail, and dealing with customers? You should take a job in retail for a few months.

Would the cost of starting this business compromise your retirement security?

 

[iLander]

YOU LADIES ARE AWESOME, THANK YOU! PLENTY MORE QUESTIONS!

DeeJay: I'm not really sure of any of that, I'm pretty much just thinking out loud.

VRBeauty: Score is an Excellent suggestion, absolutely going to look into that. What made you crazy?

Aviastar: Thank you, you're so informative! I'm going to look for you when questions come up, seriously big help. Anything you would do different? How do you choose your product?

PinkJewel: It helps to have number, I was thinking take home would be about $50K, if I'm lucky. I suspect your average price point was around $500, yes? Clothes I'm not good at, but you're right, high end items have better return. Anything you wish you had known before you opened? What is 8/10 and what terms are best?

Woofmama: How do you know when to reorder an item versus discontinue it? How do you decide what to order?

Minous: I know, these ladies got it going on, right?

facetthoughts: You should start a thread in Colored Stones, they will talk tourmaline all day there [URL='https://www.pricescope.com/community/forums/colored-stones.11/']https://www.pricescope.com/community/forums/colored-stones.11/[/URL]

sugarpie: So store landlords get a piece of your action? Wth, seriously? I've rented office space many times, but not retail space,this is news to me

Julie: I do think I would need to take a job at a store for a while to see how it suits me. I might run away screaming.

 

[monarch64]

I've worked in retail off and on for about 18 years. I've done basically everything from sales to managing to buying. My degree is a B.S. in Textiles/Apparel/Merchandising. The most helpful and informative tools for me as far as owning/operating a business were my Mathematics for Retail Buying class in college and all of my real-world experience. If you've never worked retail before, I suggest you try doing that first before venturing too much farther into this idea. Retail sales takes a lot of energy and a very thick skin.

Not sure what your plans are exactly as far as who will actually be running your business (will you basically run it or will you just hire keyholders and come and go as needed?) but you'll want to consider whether you'll stay open on all holidays like most stores or whether you'll risk losing a lot of sales by closing. October through December is most stores' bread and butter. That's not to say that only the Christmas season is considered "holidays." Memorial Day, July 4th, Labor Day, are all holidays most stores stay open on. If you run your own business and are there most of the time you might have to give up those days off or spending those weekends with family, or take those weekends off while someone else runs the store and know that your employees probably hate you for it.

Local politics and networking with other business owners is also a huge factor in the success of a new business, in my opinion. If you are not already, I would get involved in at least your local Chamber and start attending city/village meetings to get a close up idea of how things are run, who's who, and just to network in general.