A convenience store can be a very profitable venture because the products sold generally carry a high margin of profit. Many stores use gas pumps to lure customers but generally only break even on these sales. The real income is provided by items sold within the store. Developing a business model is the first step in starting a convenience store business. After identifying the target audience and a suitable location, the entrepreneur must meet state and local compliance guidelines and purchase displays and inventory.
A sales and use license should be obtained from the state department of taxation. This allows the store to collect sales tax and remit this money to the government. Specialty products like cigarettes, lottery tickets, gasoline, and alcohol require special permits. To protect the company from legal liability and take advantage of tax savings, the business can be incorporated. If the store will be operated under a fictitious name, the owner should register a DBA (doing business as) name.
Before the store can begin doing business, the local fire department and state department of health must inspect the premises. These inspections should take place before inventory is purchased because any delay in scheduling can cause products to spoil. In the meantime, an inventory list should be developed and a few reputable vendors should be secured for each item. Many vendors sell items wholesale or in bulk and some provide financing.
After deciding on their inventory, entrepreneurs must figure out what type of displays they need. Retail store displays include shelving units, wall-mounted dispensers, and wall, countertop, or freestanding racks. Checkout register wraps feature a display area under a sturdy countertop meant to hold a cash register and one or more display racks.
When ordering inventory and displays, some vendors may require a comprehensive credit history and legal information regarding the business. Storeowners should request small quantities when placing initial orders so items will not spoil while the supply chain is refined. A purchase contract should not be signed until a new entrepreneur has determined the reliability of a vendor.
Once the business gets into a groove, it will become easier to determine how often inventory must be replenished due to expiration and sales. Money-saving purchasing contracts can then be signed for the provision of products for a designated period. Convenience store shelves, racks, and containers will then offer the correct amount of inventory at all times.
Post time: 05-18-2017