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start up costs for new business

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  • 24-02-2010 12:18pm
    #1
    lyndak082
    Closed Accounts Posts: 127 ✭✭


    i feel like im asking a really stupid question here but im just wondering how exactly do you calculate the start up cost of a new business?????

    the part that gets me is STOCK?? how much should you start off with ?? is there some sort of formula or method?

    its for a clothes shop, is it a lot of guess work? like what would fill the shop?


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    #2
    PRman
    Registered Users Posts: 269 ✭✭PRman


    I guess it depend on whether u can negotiate any credit terms with suppliers and what your sales targets are. You obviously don't want to run out of stock, and need a but you need to have a float but don't want your working capital tied up in stock. I would approach someone in the same line of business for advice I think...


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    #3
    MOH
    Registered Users Posts: 6,465 ✭✭✭MOH


    (Disclaimer: I'm no expert on this, but going through a similar process at the moment)

    If you've got a business plan you should have some estimate of what level of sales you're expecting, so that's a starting point.
    You obviously don't want to run short, but you don't want too much extra either, as PRman said you don't want your money tied up in stock, plus you may have additional costs involved in storing the excess.

    You'll need to think about what your lead time is for getting new stock in.
    Also, if you're getting a better deal on bulk purchases (or delivery charges are high), it may be worth having more stock on hand if it saves you overall.

    Then try to work out a balance which allows you to keep enough stock to cover your expected sales, allow some extra depending on how accurate you think your figures are (I'm allowing 10%, I don't know if there's industry specific guidelines), and leave yourself enough time to re-stock when necessary.

    It obviously will get easier when your up and runnin g and have actual figures to go on.


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    #4
    DoMyBooks
    Registered Users Posts: 355 ✭✭DoMyBooks


    Hi Lynda, I've emailed you over the start up costs spreadsheet as promised.


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    #5
    lyndak082
    Closed Accounts Posts: 127 ✭✭lyndak082


    thank you:)


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    #6
    louise2000
    Registered Users Posts: 5 ✭louise2000


    hi was just wondering i am trying to set up a bridal dress shop and have no idea where to source the wedding dress from. Was going to try buy and sell the dresses off the peg has anyone got any ideas? Alos does anyone have an idea what private labelling is?


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    #7
    [Deleted User]
    Posts: 5,121 ✭✭✭ [Deleted User]


    This thread is three years old.
    louise2000 wrote: »
    Alos does anyone have an idea what private labelling is?
    http://en.wikipedia.org/wiki/Private_label


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