To open a retail store, or in my case a medium sized dollar store, there are many questions that I needed answers to. First, why a dollar store versus any other type retail store. How much I will make? What's the best location? What's the best square footage? How much rent should I pay? How do I negotiate the lease? How much do I pay for rent? Where do I find the money? Do I need a business plan? How do I prepare a good business plan for the store? Where do I get the equipment and merchandise? Do I need a franchise? How do I set up the store? What kind of merchandise do I need? etc. Many studies regarding dollar stores reveal that one can make money opening a dollar store. However there are many risks involved. To make money, you have to choose the right location, control costs and expenses (which include, rent, wages, and losses attributed to theft), buy and sell the right merchandise, etc.
In view of the many risks involved, a key to success is to learn how to manage these risks. In my case, when I decided last month to open my dollar store, I wanted to obtain as much information as possible. Therefore, I created the website http://www.dollartarget.com as a reality website where people can participate and help me make step-by-step decisions from the beginning until the store is up and running. Some of these decisions include selecting the store location, lease negotiation, financing, merchandising, interior design, hiring, etc. Right now, I am at my second step, which is, "how to choose the best location for the store". I have to admit by doing this, I am minimizing my risks greatly because not only I am getting common sense advice from people that have done it themselves but also I get to hear from the experts in the retail industry. For example, I wanted to know for example what is a preferred size of the store for a beginner like me to have any chance of success. I learned that it's best to start with a very clean store between 4000sq to 5000sq, with low rent near a big shopping center or supermarket with heavy traffic, with the right merchandise for the store. The type of merchandise I will buy depends on the community where the store is located. By community, I don't mean the city. I have learned that in a city, you may have several stores but yet carry different types of merchandise depending on the location of the store. For example, where I live, there are two universities in town. Since I don't like the idea that my business will dip during spring breaks and holidays, I don't plan to open the store near the universities. Therefore, I will not carry a lot of items that will appeal to students.
Did you know that dollar stores are frequented mostly by women? Therefore, I will have to have a lot of merchandise that appeal to them. Did you also know that about 60% of people going to a dollar store turn night as they enter? How does this info help, you ask? It is suggested that you put merchandise that is harder to sell on the right at the beginning. As you realize by now, information is the key to make the best decisions. As I am going through all of the steps necessary for opening my own store, I have to admit that it is an exciting experience. My goal is to open the store in about four months from now and publish a book about my experience. Therefore any constructive criticism from other readers is welcome.
