Factors to Consider Before Opening a Retail Business
The Indian retail industry accounts for over 10 per cent of the country’s Gross Domestic Product (GDP) and around 8 per cent of the employment.BY Nibedita Mohanta | Sep 02, 2017 | comments ( 0 ) |
Business is all about playing the dice smartly rather than flowing money like river and being ignorant about the surrounding at all.
The Indian retail industry accounts for over 10 per cent of the country’s Gross Domestic Product (GDP) and around 8 per cent of the employment. India is the world’s fifth-largest global destination in the retail space.
India’s retail market is expected to nearly double to US$ 1 trillion by 2020 from US$ 600 billion in 2015, driven by income growth, urbanisation and attitudinal shifts. While the overall retail market is expected to grow at 12 per cent per annum, modern trade would expand twice as fast at 20 per cent per annum and traditional trade at 10 per cent.
India’s Business to Business (B2B) e-commerce market is expected to reach US$ 700 billion by 2020.
Having money, idea and sources is not enough, there are many things that are needed to be paid attention and studied thoroughly before jumping in the line.
Know the area more and take care of the following factors before opening a retail business:
It is important to know the locality well before hand, when one has already decided to open a retail business. While doing the leg work make sure to know the average age of the local population residing in the locality.
People often make mistakes by choosing a place without much of research, they end up opening a business, which youth connect with more and the store happen to be opened in the locality, where majority population belongs to the retired old people or middle aged. These people would not connect with the product and the result is pure loss for all your hard work.
If you are going to sell customized heavy bullets and bikes, how will the retired people, (who walk on their third foot and live on their pensions) afford to ride such expensive and heavy bikes!
Measure the Pocket Size
If one is pro in studying business or how the world around functions, travelling is important. Travelling to different places will open the gate to see world in different way.
For example one would have noticed that all the uptown folks like to go some particular places or can be seen hanging out in some particular area, where no trace of middle class folks can be seen.
That is because the businessmen, whoever set up their business, do a study and start their business depending upon the pocket size of the customers. You may have flown a lot of money to open an expensive international designer bag shop but the locality comprises of only middle class or lower middle class people, who earn less than the cost of one bag, how they will afford to make your business run!
Easy Access to Basics
Find an easy access to your basic requirements, for example the supplier should be able to deliver the products in time and there should be an easy connection with the highway or main road for smooth transportation of things.
If the location of your store, branches out to many thin lanes to reach the main road then no supplier will agree to work with you in the first place, then comes the customer dissatisfaction, if they do not find their choice of things on time, why would they bother to come to your store.
Sense the Capabilities
Setting up a retail store needs a lot of labor; to start with construction, fixing furniture, arranging things, cleaning, polishing and many things go under the surface to make a retail store stand tall.
One has to look at the employment status of the people residing next to your location. If there are slums close by, you can help provide employment opportunities for the people. If the people around belongs to working class, you have to depend upon the contractor.
Moreover the kind of things you are going to start selling also depends upon the locality and the kind of work they do.
One can open a multiple brand retail store, where grocery items, clothes and household items, can be consumed by everyone.
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