If you believe experienced entrepreneurs, opening a small retail outlet in this area will bring its owner more losses than profits. The reason for this conclusion lies in the fact that the costs of renting a retail area and warehouse, wages, taxes and utilities take away almost all the profit and do not give the business the opportunity to develop.
Is it really impossible for an entrepreneur who wants to open a small building materials store without significant investments to create a profitable business? Let's figure it out.
Usually, in search of materials for repair and construction, a potential buyer is inclined to go to a large construction center, the area of which can be 1000 or even 2000 sq.m. The reason for this is several factors: the ability to purchase everything you need in one place, a wide range, and receiving a free consultation with a specialist if questions arise.
But there are also cases in which the buyer is more likely to go to a small construction pavilion: collecting materials that have run out during renovations, purchasing a small amount of building materials for cosmetic repairs, the location is close to home.
The moment that determines the profitability of a business is the choice of an advantageous location for sales. While large sellers are forced to sell their goods on the outskirts of the city, you can expand your business in a residential building, shopping center or local market.
How to choose and prepare the right premises for a store
Where to start to get building materials from scratch? To open a profitable point for selling construction and finishing materials, experts recommend paying attention to the first floor of a residential building near new buildings, or a construction market located within the city.
When opening such a business in a residential building, make sure there is an emergency exit in the premises - this will be needed to pass a fire safety inspection. If the apartment is located in a residential building, in order to process documents and legally carry out trade, you will need to remove it from the housing stock.
The profitability of your business will increase significantly if you own the retail space, but entrepreneurs do not recommend rushing into this and working in rented premises for the first 2 years.
If soon after opening, you discover that this place is not profitable month after month, then it will not be difficult for you to simply leave this outlet, without the need for subsequent sale of real estate.
If you choose a construction market, before purchasing products and renting premises, walk through the pavilions, study what your future competitors are selling and at what price.
Remember: you will be of greatest interest to the buyer only if you offer a unique product that is not on the market, or the same one, but at a more attractive price.
Decoration of a building materials store
When preparing a trade and warehouse area, there is no need for expensive finishing materials. The finished room should be bright, clean and dry. Make inexpensive cosmetic repairs and take care of good ventilation. This is all that is required from the premises for successful sales of your business. To prepare the premises you will need an average of $6,000 – $9,000.
Equipment for a building materials store
To trade building materials, you will need to purchase a cash register, as well as counters, display cases and shelving that will help in displaying finishing materials. Organize the lighting on the shelves in such a way as to create an opportunity to clearly see the products on offer.
If your business sells power tools, be sure to equip your display cases with several outlets.
Registration of a business selling building materials
The sale of building materials, like any business, requires pre-registration with the tax and pension authorities. For a small pavilion, registering as an individual entrepreneur is sufficient; this will help significantly save on taxes.
OKVED codes To register such activities, they present an impressive list, depending on the presence or absence of a trading platform on the Internet, courier delivery and other specifics. The main code that you will need upon registration is 47.52 Retail trade in hardware, paints and varnishes and glass in specialized stores.
What documents are needed to open a building materials store?
Construction materials cannot be obtained without passing inspections and paperwork. You will need to obtain a permit and patent to trade. What is needed to obtain a permit: the following documents must be submitted to the trade department of the city administration:
- Conclusion from the fire inspection and SES;
- A certified copy of documents confirming your registration as a legal entity or individual entrepreneur;
- Lease agreement or documents confirming ownership of retail and warehouse premises;
- Certificate of registration with the tax office;
- Document on the qualifications or education of the founder;
- Information about the operating hours of the enterprise.
As for the trade patent, it can be obtained from the tax office. When applying for a patent, you will go through the procedure of registering a cash register. All these activities can take from two weeks to several months, and the cost of registration and preparation of all documents necessary to start activities will be about $300.
Construction store assortment
When choosing an assortment for your organization, it is very important to provide the buyer with products of various price categories. As a rule, at least two thirds of products are presented in the middle price segment and one third remains for cheap and expensive representatives.
The assortment of the trading platform may consist of the following construction products:
- Paints, varnishes;
- Cement;
- Tile;
- Wallpaper;
- Skirting boards;
- Hand power tools;
- Construction accessories;
- Gypsum;
- Parquet, linoleum, laminate;
- Self-leveling floors;
- Various primers;
- Spatulas, brushes, rollers, etc.;
- Drywall;
- Glue;
- Construction mixtures, etc.
Construction materials store staff
To open a building materials store, owners usually limit themselves to hiring one salesperson, or, in order to save money, stand behind the counter themselves.
A seller working as a single person must have sufficient knowledge in the field of construction, design and architecture, as well as a good knowledge of the range, purpose and features of each item of goods.
If you have an experienced and knowledgeable person behind the counter, your organization's sales will be 30% higher than otherwise, so it is recommended to take this moment with great responsibility and attention.
Profitability of a hardware store
Let's calculate the profitability and find out how much it costs to open building materials with an area of about 100 sq.m.
Investments:
- Purchase of goods for sale – $10,000;
- Registration, inspections and paperwork – $300;
- Cosmetic repairs, preparation of the trade and warehouse area for work – $8,000;
- Purchase of shelving and cash register – $7,000.
Total: $25,300.
Monthly expenses:
- Rent, utilities – $560;
- Replenishment of goods - $4,000;
- Salary to the salesperson – $280;
- Accounting – $80;
- Taxes – $130.
Total: $5,050.
Profit:
We will take into account the profit based on the trade margin - 45%.
The cost of sold building materials for the month is $4,000.
Profit for the month – $5,800.
Gross profit – $750.
Thus, with regular sales of at least 40% of the total stock of goods monthly, the investments made will pay off in 3 - 3.5 years of operation.
Speaking about how to open a hardware store from scratch and make it profitable, it is useful to know a few from experienced entrepreneurs:
- Group products. Location matters a lot. It is important here that the buyer can familiarize himself with all products of one category in one place. Also distribute the products according to their intended purpose. Let brushes and rollers lie next to paint products, and screws and keys next to screwdrivers;
- Samples. Each product, which has a wide range of colors and textures, should have a catalog of samples that can be examined and touched. Place samples according to color scheme and indicate the article number for each item;
- Access. Give customers the opportunity to turn on and see how a drill or any other power tool works. Open access to your products;
- Don't stop at one outlet. One small pavilion will not be able to generate a sufficiently high and stable income. By developing and opening new points, you can protect your business from sudden surges in demand and significantly increase your income.
- Something that the buyer may forget about. Small consumables, such as light bulbs and batteries, are best placed near the cash register. The buyer will definitely remember that he wanted to purchase them while waiting for payment or his turn.
In this article we have given recommendations regarding building materials. Calculations and experience of entrepreneurs in this area have shown that, under certain circumstances, this enterprise can be truly profitable and effective.
The immutable truth is that a person must live somewhere, which means that housing construction will never stop. And housing is deteriorating, which means it needs to be repaired from time to time. In my entrance, only one of the new movers is doing repairs. The elevator is put out of service by transporting building materials. I go out onto the landing, and there are bags of cement, some cans and sheets of plywood or something else. Understanding people have long understood that the sale of building materials is a popular business.
However, lately I have often heard customer dissatisfaction with low-quality building materials. Who does it depend on? Clearly from the sellers. I think that people’s demands for the quality of building materials will only increase in the future. Do you think those who have been selling building materials for a long time are ready to improve the quality? I personally doubt it. Since they are already accustomed to high margins, they are unlikely to reduce their profits by supplying high-quality materials.
Here is a niche you can safely enter. I won’t say that the niche is simple, but it is in demand with a new approach. Times are changing, but people in this niche are in no hurry to change their views. You can start this business without investment by acting as an intermediary between customers and suppliers. Conduct a detailed analysis of the building materials market. If you seriously intend to enter this market, then one way or another you need to do it. Make a list of all building materials manufacturers in your area, as well as all sellers. I am sure that you will find shortcomings in both.
In our city, for example, bricks are transported from other cities, despite the fact that there is more than one brick factory in the city. Does this fact mean anything? Likewise, in your region there will be a not very high-quality supplier who can be replaced by a supplier from another region. The main thing is to find and negotiate prices. By gradually studying the needs of the market, you will have a complete picture of where and what to buy and at what prices you can sell. Profit can also be calculated in advance.
Now directly sale of building materials as a process. I don’t know how this process is organized in your region, but my observations in our market speak of purely passive sales. The vast majority of sellers place advertisements in newspapers and sit by the telephone waiting for a call with an order. Do you think we can use this moment? It's definitely possible! You should move on to active sales. Several agents are needed who would analyze the allocated area for repairs or construction and would immediately offer building materials with delivery.
It is worth noting that in cities there are teams of construction workers who work. As a rule, suppliers have a direct connection with foremen and interest them with bonuses for orders. Explore this opportunity in your area. Your trump card is the quality of building materials. Don't forget about this when talking with the foreman. And these details should be explained to customers. And if you can somehow prove the higher quality of your materials, then that will make all the difference.
Along with agents, it is imperative to create an online store for building materials, since society is moving towards computerization. The sooner you start, the sooner you will get results. Combining work “in the field” and on the Internet will yield results.
To increase profits you can combine production of building materials and sale of building materials. For example, you can produce paving slabs, and take all other items from suppliers. In any case, you will provide customers with building materials with delivery across the entire list.
An additional feature in your business selling building materials can be the sale of used building materials. To include this topic in your business, you will need a constantly updated database of buildings subject to demolition in your region. A team of “destroyers” is recruited and all recyclable building materials are collected from destroyed buildings. Floor slabs are especially in demand.
My friend, who is directly involved in construction, once had a database of all hangar buildings in the region. At any moment he was ready to dismantle these hangars, move them and build them again at the specified location. He offered a good price for these used hangars. It seems that his margin was not small.
At some point in your development, your sale of building materials will require the creation of a storage area.
Do not forget that this activity is regulated by section 14 of the Rules for the sale of certain goods (Resolution No. 55 of January 19, 1998 of the Government of the Russian Federation). This section concerns the specifics of selling building materials.
This is where it is indicated how to sort the goods, how to sort and check for completeness, and then store them. By adhering to the provisions of this resolution, you will save yourself from problems.
If you found the idea useful, please click the social media buttons and let the information give someone else food for thought.
Are you thinking about the topic of how to open a hardware store, and what is needed for this? Such a business can be made profitable if all the details are thought through.
♦ Capital investments – 2,500,000 rubles
♦ Payback – 10−18 months
The proverb “My home is my fortress” does not lose its relevance.”
But any fortress needs to be repaired and strengthened even more. And for this we need building materials.
According to statistics, Russians renovate their monastery every 5-7 years.
Of course, these are average figures, because some people re-glue the wallpaper and repaint the floors every three years, while others live quietly for 20 years and do not suffer from lack of repairs.
And yet, there are quite a lot of people in our country who need building materials, which should prompt businessmen to take an interest.
This startup cannot be called cheap: a decent amount is needed for rent, equipment and the first purchase, and competition in the designated sector is quite high.
But a hardware store can easily be made profitable if you think through all the details.
What kind of hardware store can you open?
If you decide to do business in building materials, then you need to decide on the concept of the future store.
Depending on the assortment, they are divided into:
- Highly specialized.
For example, you sell only flooring or decide that the best way to start your business is with paints.
Since you have a narrow profile, the range of products in one category should be amazing.
Highly specialized construction stores can be opened by businessmen who do not have a lot of money for rent and equipment, because such a market does not need large areas. - Wide-profile.
That is, in your store you can purchase any building materials, from small nails to natural parquet boards.
To open such a business, you need to have millions of start-up capital.
Depending on the size, construction stores can be divided into four conditional groups:
- Small trade pavilions (up to 100 square meters), which do not require special equipment. The assortment in such stores includes 10-20 items.
- Standard hardware stores (100-200 square meters) with a wider range of products (30-50 items) and nice renovations, because this is one of the ways to attract serious customers.
- Large construction stores (200-500 square meters) with an assortment range of 50-100 items.
- Construction supermarkets. These are real giants, located on an area of at least 500 square meters, with huge warehouses and other service areas.
Here you can buy everything, including construction equipment, because the range here starts from 100 items.
Difficulties that someone who decides to open a hardware store may encounter
The construction business is quite complex, because you need to quickly learn how to navigate among a large assortment of goods, find the best suppliers who would offer materials and equipment with an optimal price-quality ratio, supervise the work of a large staff, etc.
And even this is not all the difficulties that someone who decides to open a hardware store may encounter.
The pitfalls of the construction business look like this:
- High level of competition.
You will have to compete not only with small stores that sell a certain range of goods, but also with construction depots and hypermarkets where you can buy anything.
Carefully consider your competitive advantages to differentiate yourself from other stores.
You should also take care of the advertising campaign, using all resources (media, Internet, presentations, outdoor advertising) to inform as many people as possible about the opening of your construction market. - Pricing policy.
It seems to less experienced entrepreneurs that if they inflate prices, they can quickly recoup their capital investments.
This is a fundamentally wrong approach, because customers will quickly go to your competitors, who are cheaper.
The second mistake is to set prices too low, trying to make money on large turnover of materials.
This approach is another quick path to ruin.
The best option is to analyze the pricing policies of your competitors and reduce your prices by 1-2%. - Assortment.
One of the main problems of any business is to create the right product range, taking into account the tastes of its potential buyer.
Even if you have a narrow-profile market, for example, you sell flooring, you need to choose the right types of this same covering, the highest quality brands, the most beautiful colors, and avoid selling low-quality goods.
At the same time, you need to satisfy the needs of clients of different incomes: both rich and poor.
How to open a hardware store: working with suppliers
Interesting fact about construction:
In the 522 microdistrict of Kharkov, according to the plan, a block of residential buildings was to be built so that from the air they would form the letters of the USSR. However, after the construction of three letters C and a vertical line of the letter P, changes were made to the plan. As a result, these houses can now be seen as the number 666.
There are plenty of manufacturers of building materials today in the domestic and foreign markets.
You should choose suppliers based on the concept of your store.
For example, if you want to sell only high-quality and expensive materials that wealthy buyers can afford, then sell Italian, German, French, Finnish and other European building materials.
If your target audience is a less affluent group, then you can work with Chinese and domestic manufacturers.
The main problem for those who want to open a hardware store is the ability to find suppliers from whom they can buy goods for sale, paying after they are sold, rather than purchasing materials initially.
Suppliers, of course, are not too happy with this, so many of them will offer you this compromise: by purchasing the product right away, you can earn much more on it, setting a markup of 50-70%, while by taking the product for sale, you can earn only 30% more than the purchase cost of materials.
Decide for yourself which option is right for you.
Experienced owners of building materials markets recommend using a mixed method of working with suppliers: buying some immediately, taking some for sale.
How to open a hardware store: calendar plan
When launching a startup, it is very important not to delay the implementation of stages.
If you were able to open a hardware store two years after you had the idea, then the numbers indicated in the business plan lose their relevance.
If you have enough money to implement the project and are ready to control each of the stages, then you can open a hardware store in six months.
| Stage | Jan | Feb | Mar | Apr | May | Jun |
|---|---|---|---|---|---|---|
| Registration and more | ||||||
| Rental and renovation | ||||||
| Trade equipment | ||||||
| Personnel search | ||||||
| Formation of assortment | ||||||
| Advertising | ||||||
| Opening |
What do you need to open a hardware store?
If you decide to start this type of business, then you should start with.
The more detailed you describe all the stages of launching a startup (registration, premises equipment, personnel, assortment, suppliers, etc.), the more specific your financial calculations are, the easier it will be for you to open a building materials store from scratch.
Registration
Regardless of the size of the market, you can register as both an individual entrepreneur and an LLC.
But with the method of taxation it is more difficult.
Since it is not easy to open a hardware store on 50 square meters (if we are not talking about narrow-profile trade pavilions), then the most suitable form of taxation for you is the simplified tax system.
The OKVED code for stores engaged in retail trade in paints, hardware and other building materials is 52.46.
You also need to register with the Pension Fund and the Health Insurance Fund.
In addition to registration procedures, you will need a conclusion from the Fire Service and Rospotrebnadzor that the premises of your store meet all their requirements.
Location
Choosing a location for a hardware store is quite a difficult task.
The city center, although attractive in terms of high traffic, is not suitable for you because:
- rental prices are too high here;
- it is difficult to find a large enough room (at least 100 square meters) with convenient access (to unload goods without problems) and ample parking;
- There are too few available premises for rent.
The outskirts also have their advantages, such as low rents, but not all clients will be willing to travel that far to buy building materials and equipment.
Only those who need a lot of building materials will buy from you, and only at low prices.
The ideal place to open a hardware store is in residential areas to be closer to your potential clients.
The main thing is that there are no other construction stores, markets or hypermarkets nearby.
Room
It has already been said that for a building materials store you need a fairly large room, at least 100 square meters.
Smaller areas are suitable only for highly specialized markets selling, for example, construction tools, or paints, or wallpaper, etc.
If you decide to open a small department store, then a room of 100-150 square meters is the best option for placing a sales area, warehouse, office and bathroom in it.
There is no need to carry out serious finishing work in the store.
Your customers won't be too interested in the color of the walls or the quality of the flooring.
An exception is a hardware store aimed at wealthy clients, for example, selling French wallpaper or Italian plumbing fixtures.
But what you definitely need to take care of is the ventilation and air conditioning system.
You will have to invest from 350,000 rubles in repairs and equipment of a building materials store.
Equipment
Despite the specificity of the product being sold, a hardware store does not require the purchase of any extremely expensive and rare equipment.
It is enough to purchase standard racks, shelves, podiums, stands in order to present your product to the buyer as profitably as possible.
Focus on the specifics of the product, for example, bags of cement can be placed directly on the floor, paving slabs can be placed on a podium, making a beautiful pyramid out of them, but selling wallpaper requires a separate rack.
All hardware stores will need the following commercial equipment (calculations are very conditional, because the number of shelving, display cases, etc. depends on the size of your market):
| Expense item | Amount (in rub.) |
|---|---|
| Total: | 250,000 rub. |
| Metal wall racks | 35 000 |
| Double sided shelving | 35 000 |
| Closed glass showcases | 30 000 |
| Showcase counter | 20 000 |
| Podiums | 10 000 |
Cash register  | 10 000 |
Computer with printer  | 25 000 |
| Other | 85 000 |
Staff
In order for a hardware store to function normally, you will need a manager/administrator, two salespeople, a loader, a cleaner, and an accountant.
It is better for business if the hardware store is open seven days a week, so it is best to hire 4 salespeople (two per shift).
The cleaning lady can come every day (except Sunday) for several hours - it’s still difficult to achieve perfect cleanliness in a hardware store.
A manager or administrator can work according to a standard schedule, for example, Mon. – on Fri. from 9.00 to 18.00.
In order not to hire a separate accountant, you can enter into an agreement with an outsourcing company.
Hire men as salespeople because buyers believe that men have a better understanding of building materials than women.
| Qty | Salary (in rubles) | Total (in rub.) | |
|---|---|---|---|
| Total: | 133,000 rub. | ||
| Control | 1 | 25 000 | 25 000 |
| Salesman | 4 | 17 000 | 68 000 |
| Loader | 2 | 10 000 | 20 000 |
| Cleaning woman | 1 | 8 000 | 8 000 |
| Accountant | 1 | 12 000 | 12 000 |
How much does it cost to open a hardware store?
Opening and maintaining hardware stores requires a large capital investment, so this business is not for everyone.
Launching a startup requires at least one and a half million rubles.
| Expense item | Amount (in rub.) |
|---|---|
| Total: | RUB 1,600,000 |
| Registration | 20 000 |
| Store renovation and premises equipment | 350 000 |
| Trade equipment | 250 000 |
| Purchase of goods (we buy some immediately, we take some for sale) | 800 000 |
| Advertising | 50 000 |
| Additional costs | 130 000 |
A smart move is to create a financial plan that includes rent, staff salaries, taxes, and other expenses for the first three months until you have enough clients to cover your required monthly expenses.
You need at least 300,000 rubles a month to maintain a hardware store.
That is, if you intend to open a hardware store, you should have a capital of 2.5 million rubles.
And this is provided that you are targeting a relatively small building materials store: 100-150 square meters.
If your goal is a hypermarket where you can purchase any goods for repair and construction work, then the said amount increases several times and already amounts to tens of millions of rubles.
For those who are seriously thinking about launching this startup,
The following video will also be useful:
Possible profit from a hardware store?
Experts estimate the profitability of this business at 17%, which is a very good indicator.
The average markup on goods is 50%, which will allow you to earn at least twice the amount spent on the purchase.
The disadvantages of this business include its seasonality: sales peaks fall in the second half of March - the first half of May and the first two months of autumn.
In summer, sales figures fall by 25-30%, and in winter - by 50%.
This means that during the most profitable months you need to save money to survive the unfavorable period.
Popular small-sized construction stores (about 100 square meters) with a wide customer base rent in the evening for 20,000-40,000 rubles.
With such indicators, the amount of monthly revenue will be 600 thousand - 1 million 200 thousand rubles.
Net profit after paying salaries, rent, taxes, purchases and other expenses will leave you with 200 thousand rubles. – up to 800 thousand rubles
It is quite possible to make a building materials store self-sustaining in 10-18 months of work.
If even after studying the theoretical basis you do not fully understand how to open a hardware store and what to do to make it bring good profits, then perhaps you should take a closer look at another startup or attract a partner who is well versed in the construction business.
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Despite the fact that during the economic crisis, construction volumes decreased significantly, the need for various building materials continues to grow. If you are planning to open your own building materials store, you can rest assured that it will become a profitable enterprise.
Where to start opening a store?
Before you start a business in the trading field, decide. If you have decided on construction, then consider the following important factors.
Before opening a hardware store from scratch, you need to decide on the format of the outlet and choose a trading strategy. If you do not have large start-up capital, you can think about opening a pavilion or a small store. Its assortment may consist of 20–30 of the most popular items.
Entrepreneurs who prefer to work for the future can open a larger store with an assortment of 100 items. Luxury products should be added to the most popular products - expensive floor coverings or imported ceramic tiles.
Material base
For a building materials store to be profitable, it is necessary to ensure a flow of customers. To do this, you should locate the outlet in disturbed areas or in places with good transport links. It is desirable that as many new buildings as possible be located nearby. Thanks to this, you will be able to attract more potential buyers. You can also ask how to open a hardware store on the market.
The premises for the store should be chosen in a non-residential building. Pay attention to parking and convenient access, since buyers usually come by car to buy building materials. In order not to spend a lot of money on purchasing a premises, you can rent it. Draw up a detailed business plan for a hardware store, and then decide which option is more suitable for you.
Business registration
Many people are interested in how to open a building materials store from scratch and what documents will be needed for this. To register a hardware store, you can open an individual entrepreneur or LLC.
Provide the following documents to the tax office:
- Receipt of payment of the registration fee;
- Notarized application;
- A copy of the applicant's passport.
After registering a business, you should purchase a cash register and register it. This is what the tax office does. This process will take approximately two weeks. Some stores that sell cash registers offer expedited registration. If you don't want to wait, use this service. In this case, you will receive the documents in your hands in literally three days.
Equipment
To open a small store, you don’t have to purchase special equipment.
Can be placed indoors:
- Shelving;
- Showcases;
- Counters;
- Podiums.
To purchase all these things you will have to allocate approximately 100 thousand rubles.
The most important thing is to provide optimal conditions for storing goods.
Therefore, you should take care of:
- Heating the room;
- Ventilation;
- Air conditioning.
The room should be dry, clean and warm.
The business plan for a hardware store should include all necessary communications:
- Water supply;
- Sewerage;
- Electricity.
- Recruitment
As a rule, all building materials stores are open seven days a week. The most convenient opening hours are from 9 am to 9 pm. For such a schedule, you need to hire at least two salespeople.
The work schedule can be any.
A hardware store should hire only qualified, competent salespeople, since this is the only way to get ahead of your competitors.
Selection of assortment
Before you start working, you need to create an assortment. Some entrepreneurs, when developing a business plan for a building materials store, plan to offer customers a wide selection of products. But this will require a large room. European building materials stores can have an area of over 10 thousand square meters. meters.
You should not trade only expensive or only cheap products. Any client must find a product that suits his financial capabilities. If some item in the assortment is not in demand, you should not remove it from sale. Simply reduce the stock of these products in your warehouse.
Even beginners are well aware of how serious the competition is in the construction industry. Therefore, if you want to compete adequately in the market, we recommend that you choose a narrow niche and sell a certain group of products. Alternatively, you can offer customers a wide range or variety of wallpaper or paint.
Advertising
Advertising costs largely depend on the location of the store. If there are no competitors operating nearby, advertising costs will be minimal. Otherwise, you will have to fight tough competition with other stores. Many consumers prefer to shop at a place they trust.
For a full-fledged advertising campaign you will have to shell out 20–25 thousand dollars. To do this, you should use a traditional set of tools. Before you open a store, run a commercial on local television. Such advertising is usually quite effective, but it is not cheap. The spectacular exterior design also perfectly attracts buyers. Think carefully about how to name your hardware store so that the sign attracts the attention of passersby.
Video on the topic Video on the topic
Working with suppliers
To ensure a sufficient assortment in a large store, it is necessary to have more than 100 suppliers. If you have a large starting capital on hand, this will not be a problem. But unfortunately, many beginning entrepreneurs are financially strapped, so they try to buy goods for sale. But not all suppliers agree to such conditions. Basically they prefer 100% prepayment.
If you manage to gain trust, building materials will be supplied with deferred payment or at a good discount. Goods for sale are sold at high prices, so you won’t be able to make a good profit from them.
Some stores operate with minimal inventory. They do not want to freeze their working capital, so they make purchases several times a week. Their frequency depends on sales. In this case, you need to work clearly with suppliers. This is a rather risky form of doing business.
Business profitability
It is worth noting right away that retail trade entails high costs and is characterized by low profitability. But despite this, all large companies trade in retail. A good store is the face of the company.
Wholesale and retail trade in building materials differ in organization. In wholesale trade, it is enough to find several large clients and constantly work with them, but in retail trade you need to try to satisfy the needs of all clients.
Construction materials are purchased wholesale by foremen, architects and professional builders, but goods are purchased retail by consumers who do not know exactly what they need. Therefore, you need to hire only qualified personnel to work in the store who will help customers make their choice. How much it costs to open a hardware store can be easily calculated by adding up all the costs and adding mandatory payments to them.
Prospects for further development
A business such as trade in building materials will develop successfully, since people are constantly building or repairing something. Many new houses are delivered with a rough finish, so you have to buy high-quality finishing materials. Those entrepreneurs who can offer consumers quality products at affordable prices will undoubtedly win.Trade in construction materials is a stable business that does not require large investments. If the trading process is organized correctly, you are guaranteed to provide yourself with an average level of income. In order not to burn out during the low season, try to change the assortment on time.
Trade is considered the domain of budding entrepreneurs. “This is the simplest and therefore the most widespread type of small business,” says sociologist Arkady Semenov from Moscow. - Take, for example, building materials store. According to random surveys, where would you start your business, from the list of ten proposed ideas, many gave preference to selling goods for the repair and decoration of apartments. It turned out that this is even more interesting than a car service or.”
And in fact, almost all people, with very rare exceptions, in one way or another at least once in their lives bought wallpaper for their apartment, screws for fasteners, taps for plumbing. Moreover, due to the constant bustle and queues, one gets the impression that almost all stores of this profile are successful. Is this really so and what needs to be done to open a successful retail outlet with repair goods, we decided to find out.
Optimists and pessimists
Judging by the information and discussions on the RuNet, the topic of owning a building materials store is popular. Here are some posts worth checking out:
“...I would like to hear the opinion of knowledgeable people: how profitable is it to open a building materials store?” - forum member Bulavka is interested.
“If there is an opportunity, then there is nothing to even think about, open up, develop, prosper! This type of business will always be in demand,” another forum participant, shahter78, is convinced.
“I’ve been in the subject for a long time,” a certain Dmitry Ivanovich doubts. - There are enough problems, the most important of which is the attractive price. I don’t know how to achieve it. Repairmen are cunning people. They are looking for somewhere inexpensive. Moles dig the ground. If you raise the price a little, your customers will blow away like the wind. And trading cheaper than competitors is at a loss.”
Economist experts, in particular Mira Kolomiytseva, who specializes in small business, considers the last statement a kind of cry from the heart. “Numerous publications on the topic of “owning your own building materials store” have nothing to do with reality,” she says. - For example, some authors link starting amounts to retail space, saying these are key indicators. Abstract numbers are given, the observance of which supposedly guarantees the success of the undertaking. In particular, 500 thousand rubles are needed as working capital for a point of 100 square meters. Meanwhile, this disorients budding entrepreneurs.”
According to Kolomiytseva, people have the false impression of a quiet business that will generate income in any case. Meanwhile, the store should be “correctly configured” in terms of assortment with taking into account the prices of the nearest wholesale distributors.
We are talking about a kind of road map that should be drawn up before the start. “Buyers don’t like the narrow specialization of a building materials store,” says Valery Andreev, a businessman from Rostov-on-Don. - As a rule, they come with a list, according to which they buy. Therefore, the assortment should be as thoughtful as possible. I know one entrepreneur who, in a large chain building materials supermarket, stood at the cash register and quietly took into account who, what and how much was buying.”
In this assortment, on the one hand, duplicate items should be excluded, since unnecessary items are expensive to service. On the other hand, transport and storage costs are optimized. “It is necessary to establish a clear system of interaction with distributors,” advises Anna Smirnova, director of a small building materials store. - Good personal relationships are important here. In this case, it may be possible to access the changing price lists of wholesalers via the Internet.”
Expense arithmetic
Anna Smirnova, based on personal experience, says that the store should have convenient transport accessibility. This could be a residential area, or even an industrial zone, or an area along the main entrance and exit from a city or village. “Renovation of premises may be the most budgetary, but you will have to fork out for equipment,” Arkady Semenov is sure. “It’s psychologically important for people to buy in a familiar work environment, and certainly not in a barn.” 
Therefore, it is necessary to install up to 3 meters high and 1 meter wide, as well as several glass cabinets that can be locked with a key. You will probably need a turnstile for buyers, a packing table and about ten chrome-plated carts for purchased building materials.
Of course, each store should have its own business project, but basic indicators should still be taken into account. We present them in a simplified table.
| Position | Amount, rub. | Note |
| Working capital | 5-7 thousand per sq. m of area | But not less than 600 thousand rubles |
| Trade equipment (racks, display cases) | 2-3 thousand per sq. m of area | - |
| Rent and salary | 2-3 thousand per sq. m of area | 1 manager per 50 sq. m |
To summarize, we can say that opening a building materials store will require a businessman to detailed planning and strict implementation of the plan. Experts believe that the “break-even point” will be passed within a year from the moment of opening, while the profitability of the business should be at least 15%.