Entering the shoe retail business is fairly easy. There are no significant barriers to entry such as stringent government regulations or prohibitive capital expenses. You can start your own shoe store even without a high initial capital investment, depending on your inventory selection and store location. The shoe retail business is comprised of a large number of small independent retailers. In fact, according to a Bureau of Census study, about 30% of all shoe stores do less than $30,000 per year per store.
Here are some of the steps you need to take when starting your own shoe store:
Writing the Business Plan
Every business must start with the business planning process. The business plan is the roadmap of your business, where you will define your business, and outline the steps that can lead you to succeed. This is especially important if you are planning to seek financing for your store, as banks and investors would want to see a detailed plan of your business.
The benefits of a business plan are that it forces you to really think hard about your business, helps you identify early on the challenges that you might meet, and enable you to craft strategies that may help you overcome the challenges and bring your business to the next level.
For details on how to start a business plan, please visit Small Business Planning.
Business Registration and Licensing
The next step is to make your business legal and compliant with government rules and regulations. While different states, cities and counties have different rules, below are some common steps you need to take. However, it is best to check with your local government for the actual steps required of your new business. Read the article Small Business Legal Checklist.
You need to register your business for tax purposes and receive the necessary forms for withholding income tax and unemployment tax from the wages of all employees. Depending on your location, you can either do this by mail or walk-in registration. In Washington DC, for example, walk-in registrations are quick whereby you can immediately get your business tax number and a temporary certificate of registration (if a business license is required). Depending on your state, this process is often done in the office of tax and revenue.
Business Name Registration.
If you are operating a sole proprietorship and partnership, business name registration is one and the same as the business registration. An additional step, however, is required for corporations and limited partnership. They are required to conduct a name search to determine availability of the corporate name.
For ideas for your business name, read the article What’s in a Business Name?
Corporations; limited partnerships; limited liability companies (L.L.C.); and foreign corporations are all required to file for incorporation. You may want to seek the help of a lawyer to help you process the documents required. For more information on te different types of business structure, visit our Business Structure section.
Before you can open your doors to the public, you are likely to require a business license. Your business may be subject to fines if you fail to get the necessary licenses. Often in many states, the business category “consumer retail sales” of which a shoe retail store is covered requires a business license to operate. Check with your local government their requirements for getting a license.
Given that shoe stores typically occupy commercial space, you will be required to get a certificate of occupancy. Check with the permit processing offices of your local government. Note that you may be required to get a Building Permit and have your property inspected if you plan to make renovations to the store area.
Finding the Right Location
The right location is extremely critical to the success of your shoe retail store. Given the importance of this decision, you need to carefully evaluate your choices, making sure that the location you find can attract a lot of traffic and safely accessible to customers. Below are factors you need to consider when selecting your location:
- Your space requirements (e.g. storage, retail, office space)
- Your store requirements (e.g. lighting, customer restrooms, heating or cooling, etc.)
- Availability and adequacy of parking (avoid choosing locations that restricts your store to 2 parking spaces only)
- Population density of the area
- Safety of the area, particularly at night (adequate lighting, police and security guard protection, etc)
- Ability to attract employees
- If location is remote, amount of advertising needed to attract foot traffic
- Reputation of the landlords
- Performance of other retailers in the area (are stores closing fast in the area?)
- Presence of complementary retailers that targets same market (e.g. apparel stores)
- Presence of direct competitors (can you actually compete and be the dominant store in the area?)
- Merchant or business associations that could help promote your store
- Future developments in the potential store area (any planned zoning changes, street construction, etc. that could otherwise the traffic that your store attracts?)
- Cost of the rent (rent can be a fixed amount; fixed amount + percentage of sales particularly for shopping malls)
- Cost of other dues, if any (e.g. maintenance of common areas, merchant association fees
If you plan to locate your store in a shopping mall, read our article “Are Your Ready to Move Your Business to the Mall?.” Note that shopping mall developers are looking for stores with reasonable chance of success and fit with their overall tenant mix. As a potential storeowner, you will be asked to demonstrate your financial capabilities and merchandising experience. They will also look at your product line. The size of the shopping mall and its ability to absorb similar stores can also factor in the decision: a small shopping mall may have room for one women’s apparel, while a big mall can have several stores competing for the same market.
Once you’ve decided your location, review carefully the lease agreement before signing. If possible, hire a lawyer to help you go through the lease provisions. Look at the occupancy date, renewal or termination of lease terms, leasing costs, and tenant improvements to be shouldered by the landlord, liability, among others.
Recommended Books on Starting a Shoe Retail Store Business:
- How to Start a Shoe Design Business
- Sneaker Store Athletic Shoe Shop Start Up Sample Business Plan NEW!
- Step-by-Step Guide for Running a Retail Store Business: How to Operate and Market a Retail Shop to Maximize Profits
- The Retail Doctor’s Guide to Growing Your Business: A Step-by-Step Approach to Quickly Diagnose, Treat, and Cure
- Fashion Entrepreneurship: Retail Business Planning
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Category: Business Ideas