How to open a lighting store

* The calculations use the average data for the World

Any idea is often compared to a light bulb. A business idea can be compared to a green bulb - by analogy with the notorious American currency. And it’s quite possible to make money on the sale of these very light bulbs, only real ones (trading in business ideas is a very special enterprise). Lighting, without exaggeration, is needed in every room, in every room, and depending on the destination, the range of products for lighting can be huge. Conventional incandescent lamps generally relate to consumer goods, because they often burn out and leave a resident without light. Humanity can no longer do without artificial light, and you can make quite good money from this need.

Today's market for lighting products, of course, is filled with entrepreneurs, but you can take your place here, the main thing is to offer the buyer those products that no one else has. It is unlikely that they will be able to directly find something new in terms of technology, but it is quite realistic to buy interesting lighting devices that will attract the attention of consumers. A light store, no matter how ambiguous it may sound, can be a good idea for your undertaking, if you approach this matter correctly.

Lighting devices can be completely different directions. Their products are intended for residential premises, while the purpose of the room also determines what type of device can be installed. Industrial buildings are particularly demanding not only on the intensity of lighting and its quality, but also must be resistant to the production environment. The advertising industry is particularly in need of lighting, because a bright, shimmering fire signboard draws people's attention well. People of different professions need their light source, and the device must be arranged in a special way (the simplest example is a flashlight on a miner's helmet). A car cannot do without bulbs that give out a beam of light through the lenses of the headlights, so necessary in safe driving. Electricity has given people the opportunity to engage in almost any activity around the clock, and almost anyone needs this or that lighting device. That is, in this business there is no limited contingent of consumers; absolutely everyone needs a product.

There are enough specialized stores, especially in large cities, but not all stores can provide all kinds of assortments, so there are still specific niches that can be occupied. However, no easy competition is expected in this undertaking, and you will have to constantly monitor the market, look for new ideas and, importantly, constantly conduct marketing research and campaigns. Success depends on the entrepreneur’s ability to resist the efforts of competitors, who are unlikely to calmly surrender part of their clientele.

To start, you need to register a business entity, any form is suitable, whether it is an individual entrepreneur or a legal entity. The whole procedure of registration will require about 20 thousand rubles, at the end of which the entrepreneur will receive a code (OKPD 2) 47.59 Services in retail trade of furniture, lighting devices and other household products in specialized stores.

It is necessary to immediately decide which customers the store will be designed to, in accordance with this, organize the supply of relevant products. The most conventional division into lighting devices for residential and industrial buildings. There is also a separate segment - car light. At its core, these products are sold in specialized stores, the client arrives there for the bulbs for his car, and this group includes not only standard products, but also all kinds of additional running lights, lighting systems, headlights, etc., in the same spirit . And when registering, you will need to indicate that it is supposed to work with automotive products (despite the fact that these are all the same bulbs and lighting devices). However, the largest store of lighting products can offer a similar list of specific items and have additional good income from this. Is it worth it to deal with this and arrange difficulties for yourself, is it advisable, the entrepreneur decides, but at first it’s probably not necessary to allocate a whole department for automotive accessories. You can confine yourself to the purchase of standardized light bulbs that fit almost all models. There is such an idea, and you can forget about it, but you can earn on it.

But what you need to do in this case, of course, is household lighting devices. This is the target direction, people will come for these goods first. With all the variety of manufactured lighting devices, the client will look for something unusual, long sorting through options and doubting. Of course, there will be those who need an ordinary chandelier in the kitchen, no matter how it looks, the main thing is to be cheap, and all these factors make you have a large assortment of various products of different price segments and for different purposes.

As an idea, of course, the opening of an elite-level lighting salon can be considered, but a critical number of customers will be missed. A person needs a choice, but one offered in the framework of one price category. The larger the range of delivered items, the more attractive the store is for the consumer. Here, it is oriented in addition to quality and price to diversity, and a significant range will become a good competitive advantage.

In such a business, sometimes even slightly higher prices than competitors play a lesser role than a good choice and many solutions for every client’s taste. Depending on this, the size of the room is also selected, which starts from 50 m2. Of course, you can open a small shop with a meager choice, but ordinary light bulbs will become the best-selling goods in a similar outlet. That is, the goods will lie, withdrawing funds from the turnover, the revenue will be minimal, and the only savings (even that insignificant) will be only in the rental of the premises. A successful lighting store should not only be available, but also exhibit a large quantity of goods, and therefore a retail outlet cannot be very small.

The location must be chosen from the calculation of high traffic, optimally - the city center. It will be nice to stay in a shopping center, and even a small, small room will justify itself here. If this is a freestanding store, then it should be located on busy streets with a large number of people passing by. Advertising will attract customers who travel purposefully for a lighting fixture, but visitors who accidentally come in will also be a good source of income. The rental price in this case may be slightly higher than in the city as a whole, but these investments will more than pay off (only if there is no competitor’s store across the street and nearby). It is difficult to name the monthly expenses for paying for the premises, but about 50 thousand rubles will most likely be required. It is also possible to settle in residential or sleeping quarters, and business can flourish, but then it will be necessary to focus mainly on all residents of the city, but only on the inhabitants of the district in which the point is open. In some cases, this is even the most profitable solution, especially when the central and busy streets are occupied by competitive stores. But the opening in industrial neighborhoods can be justified only if the store has a department of industrial lighting equipment. As a rule, the simplest products for residential use are also delivered to offices, but some enterprises need products with increased resistance to moisture, aggressive environments and even explosion-proof ones. To have such goods in the assortment means to attract a significant number of additional consumers, represented mainly by legal entities. And they will make purchases for larger amounts and in larger sizes.

In general, we can say that any customer will appreciate if the store offers lighting products for all needs. Today, the buyer buys a simple chandelier, and tomorrow comes back for something else, because "there is everything." Pleasantly surprised by the choice, he will also advise the store to all his friends.

The consumer, of course, wants to receive the goods here and now, but sometimes in the outlet there is not what he needs. Some of the customers will definitely leave without finding the goods they need. In an attempt to satisfy customer requests, you can establish work through the Internet. Your own site will become a good information and advertising platform and will provide an opportunity to sell especially unusual, and therefore rarely purchased, products through an order.

The work of the lighting store initially involves either cooperation with one very large supplier with a large range or with many small ones - this is how the assortment variety is formed. The concluded agreements will allow, if necessary, to order in batches unique devices, including those on special order. The client should be able to leave a request directly on the site, what to pick up later in the store, which will act as outpost. For various reasons, non-purchased goods will simply replenish the product range of the store, that is, the funds, of course, are frozen, but the situation does not become critical from this. As in any business where there is a huge list of products sold, here you will need to conduct an ABC analysis to know after the first month of work what is in demand by the client and what is just “for the look”.

Separately, it is worth mentioning the sale of large external lighting fixtures, as a rule, these are neon signs and other advertising luminous products. They are often made to order, which imposes an obligation on the seller to find a manufacturer, but in this case, the seller becomes an intermediary who practically does not risk anything. As an option for developing your own business, you can offer advertising companies or private entrepreneurs not only the creation of signs, but even their subsequent installation. Here again, you can either play the role of an agent who finds installers and receives a commission for this, or hire your own staff of workers performing similar services. This, in a way, is already a separate type of business, but adjacent and, most importantly, quite appropriate, because customers come to the lighting salon in the hope that they will even fulfill a non-standard order. All this greatly increases the competitiveness of their business, provides coverage of a large part of the market and increases their reputation.

Working with industrial enterprises that need a special device with non-standard properties, also involves the fulfillment of an individual order to collect the necessary product, although in this area there are many standard products that will satisfy the vast majority of companies.

The outlet itself is divided into departments for the convenience of visitors. A person should not wander around the room, looking for goods of the category he needs. Departments can be formed according to different principles: the type of light source used, purpose, type of lighting, installation method. You can structure the list as follows:

  • Location (mounting method)

    • Wall (sconces)

    • Ceiling

    • Floor

    • Outboard

    • Recessed

    • Tabletop

  • Type of lighting

    • General

    • Local

    • Mixed

    • Exposition and decorative

    • Night or for dark rooms

  • Lamp light source

    • Incandescent

    • Halogen

    • Diffuse and reflex

    • LED

    • Fluorescent

    • Sodium

    • Mercury

    • Based on inert gases (xenon and neon)

  • Appointment

    • Industrial

    • For underground work

    • For outdoor lighting

    • For living spaces

    • Devices for the work of filmmakers and photographers.

In addition, there may be an auto light, ordinary bulbs, flashlights and other trifles, as well as related electronic products like adapters, tees, extension cords, switches, and the like. It is better to hire a consultant to advise visitors if the store is spacious enough. Although one person who is able to serve as a cashier, consultant and administrator is able to serve the salon, the entrepreneur himself can become one. But it’s optimal when there are two people in the store - a cashier and a consultant, while both can perform both functions. They should also be able to pack the product if it is taken from a display case. Special qualifications are not required here, employees should be just polite and trained people, so you can find workers who are willing to work on average for 20 thousand rubles a month. The amount of the starting capital of this project will be:

  • Registration - 20 thousand rubles.

  • Rental of premises - 50 thousand rubles.

  • An advertising campaign - 50 thousand rubles.

  • Outsourcing, utility bills - 10 thousand rubles.

  • Salary - 40 thousand rubles.

  • Purchase of goods - 300 thousand rubles.

Outsourcing transfers bookkeeping and cleaning. The purchase of the initial batch of goods can be made for a different amount, it all depends on the proposed spectrum of work and the available amount of funds. Thus, the required funds for opening - 470 thousand rubles, monthly expenses - 100 thousand rubles. The mark-up for different goods can be completely different, for household trifles it reaches 100%, and for unique and expensive goods no more than 10%. If the average wrap is 50%, then the implementation in one month of the initial purchase will bring 150 thousand rubles, the operating profit will be 50 thousand, and the net profit will be 42 thousand 500 rubles (simplified tax system, the calculation is made according to the “income minus expenses” scheme). It is unlikely that they will be able to reach such a level of sales in the first months; they will need advertising, discounts and promotions. However, there are prospects in this type of business, especially if you deal with related services.

A particularly good source of income can be the creation of designer fixtures, that is, the fulfillment of an individual customer order to create a unique thing. At the same time, a person who has decided to implement a design project, as well as the design studios themselves, who select products for their client, can apply for such a service. To create designer lighting fixtures, you can hire a craftsman who will perform such work. Accordingly, the cost of such a service will be very significant, but the demand for piece goods is unlikely to decrease from this. In general, all non-standard solutions in such a business can be developed if it is correctly taught and performed efficiently.

Matthias Laudanum

(c) www.clogicsecure.com - a portal to small business business plans and guides

08/18/2019


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