How do you start a retail business out of my home and cost?

Answer 1

Operating a retail business from your home requires a few things besides the obvious funding.

You first need to discover if the area your home is located in is zoned for such a business. If it is not zoned for that type of use, you will not be allowed to have it there.

A home business requires a business license and, in the case of a retail business (which indicates that you will purchase physical goods for resale) a resale permit/tax permit or license. (Called different things in different states.) It is highly suggested that you also open a business account at your bank and keep all of your business finances separate from your personal finances for tax purposes.

Will your customers be allowed within your own personal living space or will you set your business up in a separate part of your home, with it's own entry door for your customers? Some people can handle mixing their personal space with their business space and some cannot.

A retail business may need shelving and store fixtures, adding to start-up costs. You might also need a cash register. Will your products be food-related? Will you need coolers and refrigerated units?

You, of course, will also need the merchandise to sell. You will need to purchase enough to fill your shelves. Nobody like shopping in a store where most of the shelves are empty.

Depending on the type of items you sell, and the business equipment you presently own, your start-up costs could vary greatly.

You will also need an advertising budget. If you don't advertise, no one will know about your business and how to find it. Advertising can be as simple as printing single-page flyers to slip under windshield wipers, posting notices on bulletin boards, or as complex and expensive as buying a block ad in the phone book.

You can reduce your start-up costs considerably by applying for 30-day net with your suppliers. When approved, they will allow you to order merchandise and not pay for it until 30 days after receiving it. This gives you almost a month to sell a good part of it to get the money to pay for all of it. You'll need to fill out an application, business address, business bank account information, etc. and wait for approval.

30-day net is how retail stores work. They did not need to pay for the merchandise before putting it on their shelves.

I do not use 30-day net, preferring to pay for my merchandise when I order it. I never need to worry about having the money to pay the bill when it comes due.

I sell brand new merchandise at flea markets and swap meets. It is technically a retail store. I purchase new goods wholesale, mark them up a bit and still sell them for less than retail. When an item sells, I get my original cost back plus at least the same amount in profit. I always double my money and in many cases triple it.

I started with a total investment of just $200 for the initial merchandise and $10 for the space rent at the flea market. I already had a couple card tables, and my goods did not need refrigeration. My business doesn't even need electricity.

$210 is the total start-up cost of my business.

I did not take any profit from the business for approximately the first six months, choosing to let the business build by itself by putting all of the profits back into the purchase of more merchandise. Since it is a weekend-only business, I was free to continue working during the week for a paycheck (for living expenses and paying my bills), and by reinvesting all of the profit, the business expanded without needing another penny out of my pocket. (I also did not need a small business loan.)

Once my business was built as large as I intended, I could begin keeping the profit for myself without hurting the business, and it wasn't long before I gave notice at work that I was quitting.

I now literally earn thousands of dollars each and every month simply working a few hours each weekend.

I have never needed to advertise. Being that my business is located within a flea market, everyone comes to it sooner or later. A flea market, being nothing more than central gathering place for many individually owned and operated small businesses, is a great draw for the public. Plus I can take advantage of the many years the flea market has been in business. Everyone in town knows where it is.

I have my own 'retail' business and though the actual business location is not my home, it could be considered a home business, as that is where the office is located. That is the delivery address for UPS when I order merchandise.

Business expansion is crazy simple. I can easily expand my business by simply buying more merchandise and renting another space at the flea market.

As I said, I began with an initial $200 investment and waited about six months before taking the profits for myself. If I could have started with $2,000 worth of merchandise I would have been able to keep some of the profit for myself from the very beginning.