Perhaps you’ve been yearning to scratch your entrepreneurial itch for a while. You even have a business type in mind. Good for you! Unfortunately, you’re clueless about how to go about it. Or maybe you kick-started the setup process but are now stumped.
If you want to know how to start a grocery store business, this post has you covered. Let me clue you in so you have a better chance of getting your enterprise off the ground.
1. Draft a Business Plan
A business without a plan is like a traveler without a clear sense of direction. Having a plan eases the management or operation of a business. It details what your enterprise stands for, the path you intend to follow to grow it, and other vital elements.
For instance, how much do you need to invest in a typical grocery store? Operational expenses, cost of equipment, pre-opening expenses, and recurring expenses should be part of your plan.
2. Conduct Research
Consider this to be your fact-finding mission. Thoroughly research your market to establish the potential demand for your products, suitable locations, level of market saturation, pricing, market size, and more.
A sound plan also identifies your target market, preferably a local community, since you would be setting up shop in a competitive space dominated by big-box stores. Don’t punch above your weight by attempting to find ways to outmaneuver such stores.
Instead, focus on similar businesses that are direct competitors to your store. Assess their strengths and look for weak links that your business can exploit. A competitive analysis would also reveal barriers to entry and other aspects you might have missed.
3. Select a Name
Pick a business name that resonates with your target market. Your name also needs to reflect your brand- what your store stands for and how the public perceives your business.
Also, consider protecting your business name by registering it with relevant authorities. For instance, your domain name would safeguard your business’ website address, while your entity’s name protects your business at the state level.
4. Pick A Location
Where you intend to launch your business could make or break your endeavors. Ideally, your location should be in an area with considerable foot traffic. Alternatively, an online store introduces different dynamics- legal considerations and taxes.
Once you’ve done the legwork, the location you pick should consider setup costs and zoning restrictions- these may allow, ban or restrict particular types of business in an area. Your city’s planning department would point you in the right direction as far as zoning laws are concerned.
5. Get Licenses and Permits
Acquiring the relevant licenses and permits means you’re not on the hook for hefty fines or even subsequent closure for non-compliance. A grocer’s license is the bare minimum in most states. If you need to understand specific requirements for a grocery store, the Small Business Administration’s website provides a reference point for related state licenses and permits by business type.
If you intend to deal in food, you’ll require authorization from a local health department. Liquor sellers also need valid permits, which vary from one locality to another. A certificate of occupancy is also necessary, which confirms your business’ adherence to building codes and zoning laws, among other regulations.
6. Remember Insurance
Besides safeguarding your financial interests in case of the unexpected, insurance allows you to operate lawfully. Most small businesses need general liability insurance, which would be ideal before you can accurately assess your risks and review your policy. Plus, workers’ compensation insurance would be required if you plan to employ individuals in your grocery store.
7. Set Up an Accounting System
To gauge your business’ financial progress, keep proper books of accounts to track your expenses, revenue stream, inventory, equity, and more. Besides, accurately detailing your business endeavors simplifies tax filing, which ensures statutory compliance.
It also allows you to make informed business decisions. An accounting system may also be handy if you need to secure additional funds to grow your business.
8. Establish Your Brand
Have a plan of attack that would promote your store and build your brand. For instance, your value proposition would include low pricing and high-quality products. How do you plan to scale or encourage customers to seek your products once the initial buzz dissipates after launching your business? Ideally, have a long-term plan in mind as you get started.
Find ways to differentiate your business from competitors. For example, you can infuse some creativity into your marketing campaigns and create an experience that wows and lingers in your customer’s minds.
All in all, this guide covers most of what you need to start a grocery store. Take care of these basics to create a solid foundation for your business. To succeed in such a venture, you may also consider leveraging other resources such as local support networks that can help you personally or professionally.