Brick And Mortar Store Start Up

[Cowboymade]

well I hate brick but a store is the idea. Like a lot of people on this forum, we would like to have our own store that the public can walk into. My start was in a place that no one could come to unless they had a job lined up first, Antarctica but that's another story. So I have the opportunity for a downtown space with cheap rent. The idea is to do a leather studio out of it but for inventory and opportunity for others, consignment. I have consigned pieces at shops before but I'm looking for input for those of you that make leather goods and sell only on places like etsy and ebay. If you had the opportunity to sell at a local dedicated leather store, would you and what would you expect in percentage in return?.

I can open up any day with a commitment date of the first of February. I'm thinking of opening up to local artist but if its feasible I'd open up for others. Shipping the items to me would be another cost but drop shipment from anyone in the US maybe a great way.

Thoughts?

Working studio

Items for sale

Custom orders

maybe some Native American Silver in the shop

class for young folks

small place low rent in a very, very nice part of town.

[ramrod]

well, i don't know where you are located, but i was wondering what is your market? is it mainly western gear, saddles, boots? i love to make watch straps and business card holders, but it might not go if you're in the middle of a cow town. but i think your idea is well worth pondering over.

i don't know what is fair for a consignment fee. i've been offered as low as 0% for motorcycle tool bags...others were 10% and 30%.

Edited December 31, 2014 by ramrod

[TwinOaks]

I've done consignment a good bit, and 20% isn't unheard of. In my case, the store owner was also pimping out my leather and effectively using 'stock' as the hook for 'custom' orders. Yes, he got 20% of that too, but he did all the marketing, customer relations, sales, etc. If YOU have someone looking to sell through your store, I'd suggest having a minimum per month that they pay you. YOU are keeping up with inventory, overhead, utilities, AND are probably going to pay city taxes on the amount of shelf/rack space you have. You also need to do some research on consignment contracts, and when you accept something.....TAKE PICTURES and preferably have the seller sign off on them. That (hopefully)protects you from someone accusing you of damaging their goods. You should either have an escape/no-fault clause, or insurance to cover the items if they DO get damaged. That's what the 'minimum' is for. Require that the seller (if local) tends to their merchandise at least twice a month, evenly spaced. If they're high volume, more frequently. If they're high price (saddles, framed art, jewelry, etc.) watch them like a hawk. They don't get to take anything from the store without a record that YOU keep. (avoiding the "hey, where's my money for the XXXXX I put in here for you to sell (but forgot that I took it home)" type of people)

You might also offer a 'discount' if people are driving business your way with their websites. For example: "John Maker" has a website that includes the statement "products may also be seen at [[name of your store]]" A few points of your % would be worth the advertising...IF the site is actually getting customers in the door.

Contact the local radio station (whatever is popular) and inquire about ad pricing and placement (the time slot your ad airs).

Make up some "free samples" to distribute at other businesses (leather pen cups, etc.) [ a 'change tray' takes a square of leather and 4 snap sets], and include some business cards or contact info. NOTHING drives sales like jealousy and 'Keeping up with the Jones', so consider some 'freebies' for the 'popular' people....you can call it a bonus gift and hand out a braided bracelet.

[Cowboymade]

thanks Ramrod and Ambassador. Some of the mentioned I had thought about but seeing it and other info written out, helps. Helps as well coming from another view point. I like the advertisement suggestions. I also got some advice not to consign therefore eliminating the hassle with several people. I'm all for that but I'm thinking more of start up inventory, and cut back on consignment as I grow my inventory. Ramrod, this is the east coast and although I'm from the West and prefer the full blown tooled look, I'll have to be more contemporary for the city folk. Ladies bags as well as men, Harley Davidson custom orders....big bike shop nearby. Its early and I have to get to the barn...65 horses. More later

[BDAZ]

Where are you located. That's critical as to what sells and what you can charge and how much passing trade. If you purchase inventory, then you can increase your margins to 35% and set up terms like 30 days to pay. You may also look at sposoring a local music session after hours which will attract customers for straps, etc.

Sounds like fun challenging and don't forget to have a really professional website.

Cya!

Bob

[TwinOaks]

If you have a bike shop nearby, by all means.....GET A PATCH MACHINE. There's a little place in Mobile that opened up right next to a bike shop, and half of their business is walk-in, sew-on customers.

[JLSleather]

I wouldn't sell "out of " any store that wasn't mine. Between the shipping companies, the tax guys (plural), and the welfare recipients, there are more than enough people getting a 'cut' already.

[ramrod]

yeah - the heavily tooled western look goes over like a lead balloon in the east - well, for the most part. the consignment idea is a great one. putting it into practice is the tough part. i'm in the throes of something like this happening in the durham area. initial phase right now, but i'm eager to see if this will work.

i think you posted that idea in the right place. i think many craftsmen on here would like to get their stuff in a place where someone can see it - like a showroom of sorts.

BDAZ had a great idea about music. it's a real attractor.

[BDAZ]

Funny, I'm also in Durham for a few weeks for some music gigs..played SUNY Syracuse in a former life. I have met a couplel of the local leather workers at craft shows but I think the right shop in he right place would go gangbusters!

Old Time Jam session, good coffee, leather making for kids...kewl!

What part of Durham? I'm North off Roxboro.

Cya!

Bob

[BIGGUNDOCTOR]

Before you do anything you need to research the area. How much foot traffic will the location get, what is the average income of the area, is leather an item seen regularly, how are other businesses in the area doing, what price range are they selling in, will your businesses compliment each other financially, check all business related expenses ; licenses,fire dept checks,franchise tax board, city/county/state fees and other bureaucratic stuff,taxes/preparations, figure out an entire years worth of expenses and add some to that for unseen events, figure out how much product you will need to move to cover expenses let alone make a profit, shipping costs, insurances, etc.

Have an escape plan. If things go South what will you do when you still need to come up with the rent, utilities,garbage, etc till the lease runs out? We always look at the benefits of a business, but don't consider the downfalls enough, all of the what if's that can sink a company. Injuries, divorces, fire, natural disasters, economic conditions,landlord not wanting to renew a lease, rent increases, buildings get sold -- that is what ended my shop, and the list goes on depending on your situation.

Look into a book titled Entreleadership by Dave Ramsey

Most businesses will fail within 3-5 years.

If it was me doing this I would have a big cash buffer since you probably will not make a profit for the first year, or two. May even lose money till things get rolling. I cash flowed my machine and fab shop, no loans or leased equipment. Everything was paid for in cash. I bought used at auctions and saved on average 90% of new cost. As the company did better I bought more equipment. Start small, grow as needed. Do not get sucked into the credit/debt trap. If the business fails, you lose everything. If you cash flow the business all you may lose is the building, but you will still own the inventory-not the bank. But the payments are so affordable.....right until something unforseen happens. Then things just go downhill from there. This is a long term commitment, not a get rich quick scheme.

Have you thought about working out of home first? See if you can build a good base of clients before getting a storefront.

Don't get me wrong, I love seeing people venture out on their own,but running a business isn't all fun and games. I am looking to start another business myself. I just want to give you a little different opinion than others who will not be financially,or emotionally involved like you will be. All you get from them is high fives,and yipees.