Start up retail business advice.

dartboardio

Hi guys.

I have been doing some research and thinking about starting a small retail company (electronics) for a while now. There is demand for it in my area and I have suppliers etc that I can get my stock from, all that is fine.

Im wondering where do I begin? Where do I go from once I've registered the company online? What do I need to do before I register the company online?

Would it be best to contact my local enterprise office and go from there?

I would be looking for start up business support and advice along with eventually a grant of some sort so I can rent a storage unit and buy my initial stock.

Thank you.

dartboardio

Sorry I forgot to mention the business is online, selling from our website with a storage unit nearby where we can ship the items directly.

With the view of eventually reaching out to large retailers and supplying a few of them down the line.

Also, im not really sure if I would be setting up as a sole trader, or limited company, the 55% tax rate as a sole trader is turning me off the idea...

It is me and my partners idea, should we setup as a limited company? what are the tax rates like?

PickYourName

Talk to your local LEO: they do what you're looking for (support for people starting a business).

They run or can recommend training programs, and also have mentorship programs.

Make sure you've done some basic reasearch and/or training before you start spending.

Darc19

I'm going to burst your bubble.

Your posts show that you have very little experience in business and therefore you are doomed to failure.

I wouldn't spend another minute on the idea based on your two posts.

Geuze

dartboardio wrote: »

Also, im not really sure if I would be setting up as a sole trader, or limited company, the 55% tax rate as a sole trader is turning me off the idea...

Income tax rates on personal income are 20% and 40% in Ireland, plus USC.

Geuze

dartboardio wrote: »

It is me and my partners idea, should we setup as a limited company? what are the tax rates like?

You mean the Corporation tax on company profits?

It's 12.5%, it is well known as Ireland is known for its low main CT rate.

PickYourName

Darc19 wrote: »

I'm going to burst your bubble.

Your posts show that you have very little experience in business and therefore you are doomed to failure.

I wouldn't spend another minute on the idea based on your two posts.

No need to be so abusive.

I disagree with you. Many successful businesses are started by inexperienced people.

In my experience, people who succeed in business know their strengths, know their weaknesses and act to address those weaknesses: the OP demonstrates all three. I have no idea whether they will be successful or not, but if they follow through on all of those characteristics, they stand a pretty good chance of making it.

In my experience, businesses that fail are frequently run by people who think they know everything.

You seem to know so much you can say whether someone will be successful or not on the strength of two short messages. Well done, you

sasta le

How do you have contacts with suppliers?
Why arent your potenial customers going the suppliers themselves?

dartboardio

sasta le wrote: »

How do you have contacts with suppliers?
Why arent your potenial customers going the suppliers themselves?

With all due respect thats like saying why dont the customers of penneys go to the suppliers themselves and get the clothes for cheaper... It just doesnt work that way.

dartboardio

Darc19 wrote: »

I'm going to burst your bubble.

Your posts show that you have very little experience in business and therefore you are doomed to failure.

I wouldn't spend another minute on the idea based on your two posts.

To be honest with you, based on your reply i wouldn't count your opinion.

If you think you can judge someones work capability or similar based on a few posts on an online forum :V then you must have some issues.

Hahahaha it's really cute though, you trying to be patronising.

dartboardio

sasta le wrote: »

How do you have contacts with suppliers?
Why arent your potenial customers going the suppliers themselves?

Apologies, i didnt answer the actual question. I have contacts with suppliers due to doing my own research and making contact with them over the last couple of months, enquiring about prices and shipping etc.

I have one main supplier in mind that i have already gotten some samples off, and i am happy with the quality and price

My question is more so geared towards starting up, i have registered my business name, and also registered for income tax, i already have my website made, i am wondering what the next step is.

Where do people recommend to look for funding for extra stock/storage unit etc or maybe a pop up shop?

Thanks

dartboardio

Geuze wrote: »

Income tax rates on personal income are 20% and 40% in Ireland, plus USC.

Thanks. Wasn't sure. As it stands I am leaning towards the sole trader idea for now and down the line maybe a limited company.

How exactly does it work with tax, do I pay the tax once a year based on my self assessment in October?

ax530

Good luck
Not something I have done but I presume bank for a business startup loan is a starting point.
An accountant who will do your accounts & tax returns will also be useful.

Chacha97

Best of luck with the venture!

Just in regard to some of the LEO supports I'm not too sure if you'd qualify as it is a retail business.

If you were creating the products and selling them it would be a different story but if just buying from a supplier and selling on I don't think leo support that.

I'm not too sure if you'd qualify for the trading online voucher as you are just starting out. If you were established for a while I think you could avail of it

dartboardio

Chacha97 wrote: »

Best of luck with the venture!

Just in regard to some of the LEO supports I'm not too sure if you'd qualify as it is a retail business.

If you were creating the products and selling them it would be a different story but if just buying from a supplier and selling on I don't think leo support that.

I'm not too sure if you'd qualify for the trading online voucher as you are just starting out. If you were established for a while I think you could avail of it

Thanks a million! Yeah as you said, unfortunately i have checked with the new frontier programme and i am not eligible due to being a retail business, and also the trading online voucher i have to be in business a minimum of 6 months so thats out the window.

What about microfinance.ie maybe?

dartboardio

ax530 wrote: »

Good luck
Not something I have done but I presume bank for a business startup loan is a starting point.
An accountant who will do your accounts & tax returns will also be useful.

Thank you!

Chacha97

dartboardio wrote: »

Thanks a million! Yeah as you said, unfortunately i have checked with the new frontier programme and i am not eligible due to being a retail business, and also the trading online voucher i have to be in business a minimum of 6 months so thats out the window.

What about microfinance.ie maybe?

Oh may I ask what new frontier programme you contacted? Interested in the programme myself and need to get in contact with them!

I think microfinance might be an idea but again I'm not totally sure if you need to be actually generating some sales! May I ask what area of electronics are you in?

Darc19

PickYourName wrote: »

No need to be so abusive.

I disagree with you. Many successful businesses are started by inexperienced people.

In my experience, people who succeed in business know their strengths, know their weaknesses and act to address those weaknesses: the OP demonstrates all three. I have no idea whether they will be successful or not, but if they follow through on all of those characteristics, they stand a pretty good chance of making it.

In my experience, businesses that fail are frequently run by people who think they know everything.

You seem to know so much you can say whether someone will be successful or not on the strength of two short messages. Well done, you

I'm certainly am not being abusive. But there are glaring deficiencies in the op's thinking, so they are on a path to failure.

They need to work in the retail trade, understand it, know the pitfalls and have finance.

Then they may have a chance.

But from the posts, there's zero chance of success.

Darc19

dartboardio wrote: »

To be honest with you, based on your reply i wouldn't count your opinion.

If you think you can judge someones work capability or similar based on a few posts on an online forum :V then you must have some issues.

Hahahaha it's really cute though, you trying to be patronising.

I clearly stated that based on what you said, it was doomed for failure.

And I'm fairly certain now with your response.

dartboardio

Darc19 wrote: »

I'm certainly am not being abusive. But there are glaring deficiencies in the op's thinking, so they are on a path to failure.

They need to work in the retail trade, understand it, know the pitfalls and have finance.

Then they may have a chance.

But from the posts, there's zero chance of success.

You seem to keep saying the same thing 'set for failure' etc without any clear evidence...

Once again, you seem like you are jumping to conclusions, saying i should work in retail.

I have worked in retail, and customer service, and the restaurant industry.

My store needs people that have marketing experience and customer service experience. The rest, they can learn.

Cheers for the reply though.

And your 'have finance' doesnt make much sense. Isnt that what financial supports are there for? Of course i would be going in with a percentage of what i am asking for.

Besides, i can set up and get stock with what i have in my pocket at the moment, however it would be more beneficial if i got some sort of grant.


Your posts come across unnecessarily rude tbh. I could also make plenty of judgements based on your post history but i wont.

jimmii

A lot of the things people are asking are the same sort of questions anyone who decides where finance goes too most likely. What are you going to say when the person holding the purse strings asks why should we give you the money over someone else?

When we started our retail business we were absolutely clueless and have somehow managed to make to work so you never know you might just make it work if you really want it!

Do you have a specific niche you are going to target where you feel there is a gap? Its worth having a look at how competitive the keywords are as that's going to be where your biggest outlay is most likely to be outside of stock. You might do OK with demand in your area but you obviously want to make sure there is demand across the UK and Ireland and ideally Europe as well so you can try build a long term business.

Frankie19

Try microfinance ireland for finance otherwise you will need a bank for a stocking loan which id imagine will be difficult to get at the moment.
Also look into a partnership if you are going in with someone else for the first few years and then you can move to limited if successful. It will limit your financial exposure should things not work out. You need to get a good accountant who will be able to advise you.
Out of interest what type of electronics are you looking to sell as the margins are extremely tight on phones and TVs e.t.c especially when a disti take their 2/3 % cut.

Frankie19

also in regards to microfinance you will need to submit and present to them a full 4 year business plan and I think they fund 50% and then a bank will co fund the other 50% if I remember correctly. It Was about 6 years ago someone I know used them so it may have changed.

Darc19

@op

Fair enough, proceed.

But I've yet to see a bank or a grant from anywhere to provide the finance for your warehouse and starting stock of a retail venture.

I could fluff about it, but would much rather a direct approach.

But ignore it.

PickYourName

Chacha97 wrote: »

Just in regard to some of the LEO supports I'm not too sure if you'd qualify as it is a retail business.

Just to be clear on that point: LEOs are for all types of businesses. They are definitely worth engaging with, especially to point you in the direction of answering the kinds of questions the OP is asking.

The only supports not available to retail businesses are financial ones, which is tough, but don't discount all the other help and advice they can provide. Indeed, even on financing they can go through possible options for you, even if they don't provide any themselves.

Microfinance Ireland are certainly worth considering. We used them a few years ago when bank finance fell through at the last minute for a new venture (also retail as it happens). Unlike the commercial banks, they acted very quickly (a few days, rather than dragging us out for months).

PickYourName

Darc19 wrote: »

I'm certainly am not being abusive. But there are glaring deficiencies in the op's thinking, so they are on a path to failure.

Patronising someone and telling them they're going to fail is abusive.

thebiggestjim

One bit of advice I have from experience is spend as much time as you can securing your first paying customers (and obviously spend a lot of time securing subsequent customers). People tend to put this part on the long finger because it is the hardest.

It sounds like you have some relationships already built up with potential customers. Try and get some orders on the books before you go leasing any units. Clear out a room in your house, ask a friend for some temporary space, some business in the area might have a room the can lend you to store stock temporarily. Keep costs as low as possible until you have some customers, then go looking for money.

Banks, state support orgs, etc are much more receptive when you have paying customers.

Your story will then be: "Look, I have proven there is an unmet market demand for XYC electronics. I have everything we need to supply the market, the only thing missing is some funding."

Good luck, don't listen to the naysayers.

antoinolachtnai

Business is hard. Retail is really really hard.

I know plenty people who are qualified to set up and run this kind of business, but would not do so. The reason is simply that they know they could not make money. The reason is simple. Unless you are extremely skilled the entire gross profit for each item sold would be eaten up by the marketing, sales and fulfillment costs. Even if you are extremely skilled you won't make much money. All you are doing is financing (a) your manufacturer and (b) Amazon with the sweat of your brow.

There are ways to make a turn on it sure. But as I say, it's very difficult. If you have some special niche that is uncatered for or where you have special knowledge, then there is an opportunity in it perhaps.

It is great to encourage the OP. But the reality is that with his or her level of knowledge, by going ahead right now, he or she will most likely lose their entire initial investment. Maybe the OP or their friends and relatives are rich enough to do this and that's fair enough. But going into a capital intensive business can really make a mess of your life if you don't have these types of resources.

This isn't an off the top of the head type of comment, there are several clear indicators in what the OP has written that there is a knowledge deficit, about both the sector and about business generally.

'Feel the fear and do it anyway' should not be the only watchword of a business person. Business is about risk, certainly, but it is about calculated risk, especially when other people's money is involved.

But that's ok. The OP is quite right to be curious and to ask questions and try to increase his or her knowledge level before actually investing.

It is really a good idea to go through the LEO or other bodies and do courses, to get at least an academic grasp of marketing, sales, human resources, bookkeeping and accounts and how businesses are financed. This knowledge will stand to him or her whether they proceed with this business idea or not.

dartboardio

antoinolachtnai wrote: »

Business is hard. Retail is really really hard.

I know plenty people who are qualified to set up and run this kind of business, but would not do so. The reason is simply that they know they could not make money. The reason is simple. Unless you are extremely skilled the entire gross profit for each item sold would be eaten up by the marketing, sales and fulfillment costs. Even if you are extremely skilled you won't make much money. All you are doing is financing (a) your manufacturer and (b) Amazon with the sweat of your brow.

There are ways to make a turn on it sure. But as I say, it's very difficult. If you have some special niche that is uncatered for or where you have special knowledge, then there is an opportunity in it perhaps.

It is great to encourage the OP. But the reality is that with his or her level of knowledge, by going ahead right now, he or she will most likely lose their entire initial investment. Maybe the OP or their friends and relatives are rich enough to do this and that's fair enough. But going into a capital intensive business can really make a mess of your life if you don't have these types of resources.

This isn't an off the top of the head type of comment, there are several clear indicators in what the OP has written that there is a knowledge deficit, about both the sector and about business generally.

'Feel the fear and do it anyway' should not be the only watchword of a business person. Business is about risk, certainly, but it is about calculated risk, especially when other people's money is involved.

But that's ok. The OP is quite right to be curious and to ask questions and try to increase his or her knowledge level before actually investing.

It is really a good idea to go through the LEO or other bodies and do courses, to get at least an academic grasp of marketing, sales, human resources, bookkeeping and accounts and how businesses are financed. This knowledge will stand to him or her whether they proceed with this business idea or not.

Now, thank you. Something like that is exactly what i am looking for. Someone to lay it all out. I am clearly here to ask questions, not to pretend or say I know it all.

What I am setting up at the moment does not need much of an initial investment as at the beginning it will be essentially dropshipping, the customers will receive the products direct from the supplier after they have placed the order from my website.

There is definitely a gap in the market, along with some demand for the product. I am not looking for business in a saturated market whatsoever.

Then eventually get funding for a storage unit to ensure quicker shipping time and maybe a pop up shop.

Thanks for the advice regarding LEO. I will be talking to them further throughout the week to see if there is any funding that would suit me, if not, its not the end of the world but its definitely something I'd be interested in.

PickYourName

antoinolachtnai wrote: »

Business is hard. Retail is really really hard.

I know plenty people who are qualified to set up and run this kind of business, but would not do so. The reason is simply that they know they could not make money. The reason is simple. Unless you are extremely skilled the entire gross profit for each item sold would be eaten up by the marketing, sales and fulfillment costs. Even if you are extremely skilled you won't make much money. All you are doing is financing (a) your manufacturer and (b) Amazon with the sweat of your brow.

There are ways to make a turn on it sure. But as I say, it's very difficult. If you have some special niche that is uncatered for or where you have special knowledge, then there is an opportunity in it perhaps.

It is great to encourage the OP. But the reality is that with his or her level of knowledge, by going ahead right now, he or she will most likely lose their entire initial investment. Maybe the OP or their friends and relatives are rich enough to do this and that's fair enough. But going into a capital intensive business can really make a mess of your life if you don't have these types of resources.

This isn't an off the top of the head type of comment, there are several clear indicators in what the OP has written that there is a knowledge deficit, about both the sector and about business generally.

'Feel the fear and do it anyway' should not be the only watchword of a business person. Business is about risk, certainly, but it is about calculated risk, especially when other people's money is involved.

But that's ok. The OP is quite right to be curious and to ask questions and try to increase his or her knowledge level before actually investing.

It is really a good idea to go through the LEO or other bodies and do courses, to get at least an academic grasp of marketing, sales, human resources, bookkeeping and accounts and how businesses are financed. This knowledge will stand to him or her whether they proceed with this business idea or not.

Very much agree with all of this.

"Don't do it, it's a terrible idea, you've no experience, it's doomed!".

"You're great, go for it! Forget the naysayers!".

Both of the above are bad advice - I'm not sure which is worse (probably the second one).

To my mind, the key thing is the OP has acknowledged the gaps in their knowledge and gone looking for answers, which to me is a good sign.

My advice to OP:

- build up your knowledge. LEOs don't just offer academic knowledge by the way; their mentorship programs can be really useful (highly dependent on the individual mentor, of course)
- write a business plan. Even if you didn't need one to raise finance, it's a useful thing to do to force you to look into all areas of the business
- evaluate the business plan realistically, which will tell you if there really is a business there (i.e. evaluate the risk mentioned in the comment above)
- go/no-go based on the evaluation
- if it's a go, then get some early customers, prove the model, raise some finance etc.

20/20

dartboardio wrote: »

What I am setting up at the moment does not need much of an initial investment as at the beginning it will be essentially dropshipping, the customers will receive the products direct from the supplier after they have placed the order from my website.

Can you tell us what sort of electronics are been sold, and who your competitors might be.
I really hope your business idea is not selling cheap gadgets from China. Companies like ( Chinavasion ) do the drop-shipping for retailers. The profit margin may look good but the gadgets are junk, and the customers go mad when goods arrive with a bill for import duties.