So you’ve found your premises, stock and supplier - now you need to start considering general business issues. Just because your goods may be cheap does not mean you’re going to be able to pay any less attention to all the official legislation and red tape which goes with being your own boss. Tax, National Insurance, VAT, Health and Safety all still have to be thought about.
In terms of recruitment, finding suitable retail staff is rarely going to require more than a notice in your window or a cheap ad in the local paper. You should have access to a pool of either mature workers or teenagers, who’ll mainly be working part-time, depending on the size and scale of your operation. Once you have your workforce in place, chances are any additional members you decide to take on board will probably come your way via word or mouth or through speaking to other businesses.
When all this is in hand, you can start to think about making some profit. With a pound shop you’ve got every chance of developing a good customer base who will probably spend more than they an anticipated.
If you can keep new lines coming in every week, this customer satisfaction will be further enhanced. When customers start to see the items in your pound shop are much cheaper than in their local supermarket, and just as importantly they will always be the same price, you’re onto to a winner.
And of course there’s something nice about being able to work out how much your goods are worth before you get to the till! “I don’t know how many times a day I hear ‘I only came in for a shampoos and now I’ve picked up a basketful,” says pound shop owner David Wilson.
Though you’ll be popular with customers, don’t expect the same treatment from your fellow shopkeepers because you’ll probably be busier than them most of the time and you’ll probably undercut some of their range on price. Never forget you are doing the same job as any other store. Buying and selling goods, managing staff, paying taxes and so on. The secret to success is the ability to keep an eye on all this, but also on your profit margins.
“The reason a lot of new retailers and shopkeepers fail is that they don’t think like business people,” says Len Griffin. “They don’t think in terms of money and instead just become far too engrossed in the day to day running of the store and end up employees of the proposition, so rather than owners they’re acting like managers.”
On top of this, it will be a help if you’re physically fit - because there will be plenty of stock shifting to be done - and make sure you don't get flustered when the shop’s teeming with customers. Though each shop is different, you should be aiming to be able to take away 25% of what ends up in the till, after the VAT-man has had his 17.5 per cent cut.
Out of that you’re going to have pay all your overheads such as wages, rent, insurance, and so on. What’s left you get to keep but only after you have sorted out your own personal tax. We're not talking millions here, but you certainly should be quids in.