The Essential Guide to Retail Store Layouts that Shape the Customer Experience

By Kate Eby | October 26, 2017 (updated June 28, 2023)

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Although the retail industry is transforming as technology continues to shape the consumer landscape, the primary goals of a sound retail strategy have not changed: Deliver value in the supply chain and create a unique customer experience. The rebirth of retail stores — after years of digital disruption and economic challenges — is possible if retailers can successfully contend for their consumers’ attention, and in return, earn their business. One way to do this is to design a digital and physical retail environment that captures the overtaxed attention of consumers today.

In this article, you’ll learn about how retail customers predictably behave, why this behavior matters, and how you can influence it with a thought out store layout design. Use the navigation guide on the left to find a collection of essential retail floor plans and discover the pros and cons of each. If you’re ready to plan and design your store, jump ahead to the tips and best practices from professional retail designers, and browse through the design resources to help you imagine and create a new environment that captures your customer’s attention. 

What Is a Retail Store Layout?

A retail store layout (whether physical or digital) is the strategic use of space to influence the customer experience. How customers interact with your merchandise affects their purchase behavior. This retail principle is one of the many from Paco Underhill, author of Why We Buy: The Science of Shopping, keynote speaker, and founder of Envirosell. 

The interior retail store layout has two important components:

  • Store Design: The use of strategic floor plans and space management, including furniture, displays, fixtures, lighting, and signage. Website designers and user experience (UX) researchers use space management techniques and web design principles to optimize e-commerce websites. We’ll further discuss a variety of popular retail floor plans later in this article.
  • Customer Flow: This is the pattern of behavior and way that a customer navigates through a store. Understanding customer flow and the common patterns that emerge when customers interact with merchandise based on the store layout is critical to retail management strategy. Physical retailers are able to track this using analytics software and data from in-store video and the wifi signal from smartphones. For example, solution providers like RetailNext provide shopper analytics software for retailers to understand flow and optimize the customer experience based on in-store video recordings. The technology also exists to track the digital customer flow and online shopping behavior. Using “cookies” and other software, online retailers can track customer behavior, including how customers interact with their website.  

While the exterior retail store layout includes exterior store design and customer flow, it also includes the following factors:

  • Geographic location of the retail store (real estate)
  • Size of the building and length of the walkways accessible from the entrance and exit
  • Use of furniture and exterior space for people to gather and interact
  • Style of architecture of the retail building
  • Color of paint and choice of exterior building materials 
  • Design of the physical entrance and exterior window displays

The objective of retail store design is to positively impact customer experience and create value, which is the primary goal of retailers in the supply chain. For more information on retail strategy and management read the article “ How to Survive and Thrive in Retail Management .” 

What Is Store Planning?

Store planning is the designing and optimizing of physical retail stores to upgrade customer experience and maximize sales. It involves determining the ideal store size, layout, fixture placement, signage, and product placement to create a visually appealing and engaging shopping environment.

A Step-By-Step Guide to Planning Store Layouts that Maximize Your Space

It is essential to understand your customer flow and the general patterns of navigation in your specific retail environment before you can optimize customer experience and plan a strategic store layout. Retailers, consultants, store planners, interior designers, and architects all use a variety of retail floor plans and concepts to influence customer flow and behavior. Retail giants along with small, independent retailers can improve customer experience, and in return, long-term profitability with efficient store layouts. In Store Design and Visual Merchandising: Creating Store Space That Encourages Buying, author Claus Ebster offers valuable insight into maximizing your retail space. 

Step One: Target The First Floor

The first step to maximize your profitable retail space might be the most unavoidable, however the principle and knowledge behind the customer behavior is crucial for understanding your overall design strategy. Ebster’s research indicates that customers prefer to navigate the floor of a retail store they initially entered. Walking up and down stairs or using elevators and escalators to navigate a store hurts customer flow. When possible, planning for a single floor store design will optimize the customer experience. Exceptions exist, such as downtown locations where real estate is at a premium or large department stores with multiple categories of merchandise. Further, Ebster points out that retailers should consider customer perception if they are a luxury retailer, as shoppers often associate multi-level stores as “elite.” Conversely, if a discount retailer is planning store layouts, as customers associate single floor layouts with “less high-end” merchandise. Consider your overall retail strategy and store layout design prior to selecting your store location. If you have multiple floors, account for the preferences of first floor shoppers by using this space for the feature or high-margin merchandise in your retail mix. 

Step Two: Identify Customer Flow

Ebster presents some general rules for customer traffic. Customer flow patterns vary depending on the type of retailer, the size of the store, and the target customer. Ebster encourages retailers to use their observations to discover the problems and opportunities unique to their environment. The next step in maximizing your space for profitability is identifying your customer flow. The most effective method for understanding your existing customer flow and identifying areas of opportunity is video recording and heat mapping analysis. This service is available via solution providers such as Prism (you can also do a quick online search for heat mapping consultant services in your area). However, setting aside different times of the day to make in-store observations in person and recording your notes is a step in the right direction for identifying customer flow patterns. 

Step Three: Avoid The Transition Zone

After you identify how your customers navigate your entire retail space, turn your attention back to the entrance. The transition zone area, coined the “decompression zone” by Underhill, refers to the space just beyond the entrance to a retail store. The average customer needs this space to transition so they can familiarize with the new environment. Underhill is adamant that nothing of value to the retailer, not high-margin merchandise, prominent signage, or brand information goes inside this zone. Customers need time, however brief, to adjust to new lighting, smells, the music, and the visual stimulation in the store. 

Step Four: Design for Clockwork Navigation

The next step moves beyond the transition zone and shifts the focus on how to leverage a customer’s tendency to navigate the retail environment. The area just outside of the transition zone is where most retailers make a first impression. Customers consistently turn right after entering the store and continue to navigate the store in a counterclockwise direction. Ebster points out that this customer behavior repeats itself time and again in consumer research. Although researchers and design professionals have different explanations for the reaction, in general, many recommend displaying high-margin merchandise and valuable information just to the right of the entrance (outside of the transition zone). Underhill popularized the “invariant right” and proved the effectiveness of the technique with thousands of hours of video. 

Step Five: Remove Narrow Aisles 

Finally, follow your customer flow through the transition zone and around the retail space in a counterclockwise pattern. Search for tight spaces or bottlenecks along aisles or around fixtures and displays. Repeated analysis of Underhill’s video research demonstrates that customers in the US — women in particular — value their personal space when shopping. If a customer is touched, bumped, or otherwise interrupted when interacting with merchandise, they are likely to move on from the items or exit the store altogether. Ebster uses customer behavior research from one study of a supermarket to further advocate for broader aisle design. Video analysis showed fewer customers entering narrow aisles in the store compared to the more expansive, accessible walkways. These aisles send positive signals to shoppers and positively impact customer flow and merchandise interaction. Avoid narrow aisles and corridors when planning your store layout and strive to protect customers from what Underhill coined as the “butt-brush effect.” 

Essential Retail Store Layouts

Once you research and understand how customers navigate your store, you can start influencing how they interact with the merchandise. The foundation for this strategy is the design of your store floor plan. To create an environment that strategically emphasizes the desired purchasing behavior, it is essential to use all of the floor space you have allotted for merchandise, base your layout on the principles of customer behavior, and not sacrifice customer flow for artistic taste. With these factors in mind, the following are common store layouts for your consideration.

Forced-Path Store Layout

Forced Path Store Layout

This layout directs the customer on a predetermined route through the retail store. As an example, Ebster uses furniture retailer IKEA to demonstrate the use of the forced-path store design. Research shows that, with this type of store layout , IKEA achieves a uniform and efficient customer flow that promotes higher sales. 

Ebster discusses the advantage of a forced-path layout: Every aisle in the store is maximized. With customers exposed to all of the merchandise offered, this design might entice the customer to make an unplanned purchase. However, he points out that using this store layout risks irritating shoppers that have a specific task and desired location, and could also overwhelm shoppers by hurrying them through an experience of customers all moving in one direction together, quickly.

Grid Store Layout

Grid Store Layout

The grid store layout design is a familiar, repetitive pattern favored by retail drugstores like Walgreens and hardware stores like Ace Hardware. According to Ebster, there are multiple advantages to the grid layout, including the following: 

  • Customers can move quickly through an efficient floor space using standard fixtures and displays. 
  • The presentation is uniform and comfortable due to its popularity, creating a seamless customer experience. 
  • Design simplifies inventory control for the retailer - a key to retail strategy that leverages store design to maximize profitability. 

However, the downside of this layout is the lack of aesthetics and the “sterile and uninspiring” environment often associated with its use. To counter this, Ebster recommends effective signage to guide customers and create a “cognitive map” of the store. 

Loop Store Layout

Loop Store Layout

Also known as the “racetrack” layout, think of the loop design as the “yellow brick road” of retail store layouts. Ebster uses this analogy to describe the way a loop store layout uses a path to lead customers from the entrance of the store to the checkout area. This is a versatile choice for store design when implemented with another layout style or used as a prominent feature of the retail store. Ebster recommends this layout for a larger retail space (over 5,000 square feet) and encourages a clear and visible loop for customer flow. 

Designers accomplish the loop effect by making the floor path a standout color, lighting the loop to guide the customer, or using a different floor material to mark the loop. Lines are not recommended, as they can be a psychological barrier to some customers, potentially discouraging them from stepping away from the loop and interacting with merchandise. Ebster encourages a loop design that rewards the customer with interesting visual displays and focal points on the way to the checkout area. 

Straight Store Layout 

Straight Store Layout

The straight store layout is efficient, simple to plan, and capable of creating individual spaces for the customer. Plus, a basic straight design helps pull customers towards featured merchandise in the back of the store. Merchandise displays and signage is used to keep customers moving and interested. 

Liquor stores, convenience stores, and small markets use the straight design efficiently. However, the drawback is the simplicity: Depending on how a customer enters the store and moves past the transition zone, it may be more difficult to highlight merchandise or draw them to a specific location. 

Diagonal Store Layout

Diagonal Store Layout

Just as the name implies, the diagonal store layout uses aisles placed at angles to increase customer sightlines and expose new merchandise as customers navigate through the space. A variation of the grid layout, the design helps guide customers to the checkout area. Small stores can benefit from this space management option, and it is excellent for self-service retailers because it invites more movement and better customer circulation. 

When the checkout is located in the center and possibly raised up, the diagonal layout offers better security and loss prevention due to the extra sightline effect. The downside of this layout is that it doesn’t enable the customer to shortcut toward specific merchandise, and the risk of narrow aisles is higher.  

Angular Store Layout

Angular Store Layout

The name of this design is deceptive, as the “angular” store layout relies on curved walls and corners, rounded merchandise displays, and other curved fixtures to manage the customer flow. Luxury stores use this layout effectively because, according to Herb Sorenson’s research from Inside the Mind of the Shopper: The Science of Retailing, customers notice free-standing product displays 100 percent of the time (end cap displays - those at the end of aisles - also get noticed 100 percent of the time). 

There is a perception of higher quality merchandise that the angular layout leverages to target the appropriate customer behavior in that environment. And although this design sacrifices efficient space use, because of the rounded displays and limited shelf space, if a retailer has sufficient inventory storage away from the sales floor, this layout is useful in creating a unique perception. 

Geometric Store Layout  

Geometric Store Layout

Popular with retailers targeting trendy millennials and Generation Z demographics, a geometric layout offers artistic expression and function when combined with the appropriate displays and fixtures. The unique architecture of some retail stores, including wall angles, support columns, and different ceiling styles mix well with the uniqueness of a geometric layout. 

Merchandise displays and fixtures of various geometric shapes and sizes combine to make a statement, often as an extension of the retailer's overall brand identity. Clothing and apparel stores use a variety of environmental merchandising strategies (for example, music, scents, and artwork) with the geometric layout to enhance the customer experience.  

Mixed Store Layout

Mixed Store Layout

The mixed store layout uses design elements from multiple layouts to create a flexible option for retailers. Department stores use a compelling mix of straight, diagonal, and angular concepts, among other design elements, to create a dynamic flow through a range of departments featuring a variety of merchandise. 

Large grocery store chains also successfully combine mixed store layout elements. For example, customers have the flexibility to navigate through a grid layout for their basic groceries but feel compelled to search the angular displays featuring high-margin wine, beer, and imported cheeses. The advantages of combining different store layouts seems apparent, but the space and resource requirements to maintain this design can pose difficulties to retailers. 

What Is a Free Flow Store Layout?

Free Flow Store Layout

A free flow layout rejects typical design patterns and styles commonly used to influence customer behavior. In a free flow layout, the intent is not to lead the customer using predictable design patterns, displays, or signage. There are no specific design rules followed for this retail store design, and customers have more liberty to interact with merchandise and navigate on their own. For this reason, the free flow layout is sophisticated in its simplicity.

Ebster points out that customers feel less rushed in this creative environment. Retail stores look less sterile in the free flow design, and merchandise may seem more intriguing. The only limitation for retailers using this layout is the overall space available, but that doesn’t mean that the research on customer navigation behavior and tendencies shouldn’t be accounted for as well. The main disadvantage to this experimental design layout is the risk of confusing customers past the point of their preferred behavior and disrupting customer flow. 

What Is a Boutique Store Layout?

Boutique Store Layout

According to Ebster, the boutique layout (also called shop-in-the-shop or alcove layout) is  the most widely used type of free flow layout. Merchandise is separated by category, and customers are encouraged to interact more intimately with like items in semi-separate areas created by walls, merchandise displays, and fixtures. Typically used by boutique clothing retailers, wine merchants, and gourmet markets, this layout stimulates customer curiosity in different brands or themes of merchandise within the overall category. 

  • The downsides of the boutique layout include the following factors:
  • Reducing the total display space for merchandise with inefficient space management 
  • Encouraging too much exploration of separate areas within the store 
  • Confusing customers past the point of purchasing behavior. 

Ultimately, the exploration can distract from customer interaction with the merchandise.    

Retail Store Design Tips From The Pros

Jaina Rodriguez

Jaina Rodriguez is a Creative Director of the Integrated Design-Retail Design Studio at Microsoft. She is adamant that store design is important and should not be overlooked when designing the customer experience. 

“It is everything! The look, feel, and sounds evoke feelings in consumers and the more it resonates, engages, comforts, or surprises them, the more likely they are to purchase or become a fan, which leads to [more] fans,” says Rodriguez. “If [the design] is too loud, has obstructed or confusing pathways, which some retailers use as a sales tactic, no rhyme or reason [...], it is not conducive to customers spending more time [in store] or converting sales.” 

A store’s layout design is not an isolated advantage for retailers. Rodriguez points out that the customer experience is influenced by more than the overall layout. “It’s a mix of thoughtful moments — placement of product stories and unassisted digital experiences throughout the [store] footprint — mixed with sales people that help consumers make decisions quickly and effectively.”

“I think alongside [customer] flow is understanding the sales data to help better inform where you want to [attract] the customer and what the overall experience is from the front to the back of the store,” says Rodriguez. “For a store footprint [design] within a mall, a commercial shopping area, or [inside] a third party retailer (for example Best Buy or Target), understanding the key players around your area and their sales tactics should be a priority. Many companies make the mistake of copying what others are doing, which creates more confusion. People have brand loyalty and want to see differentiation and a reason to move from their comfort zone.”   “Best Buy does this well,” says Rodriguez. “They do a great job with a mix of digital innovations, retail pros and the Geek Squad. They can entice the customer via emails, push alerts via their app, digital experiences throughout the store, assisted and unassisted sales, and tech help to ensure your product is ready to use or installed properly. Basically, they cover all the bases from start to finish and while they don’t always hit the mark, they are open to innovation and trying and measuring new ways to reach the customer base and beyond.” 

Rodriguez does not agree with all of the store layout design and “storytelling” that Best Buy uses throughout some of their locations. For example, she believes the video game section could be designed to be more cohesive and less scattered in different spaces. 

Authenticity Creates Real Customer Experiences

When it comes to designing the retail store and customer experience, Rodriguez has a specific message. “Be authentic and real,” she says. “Create memorable moments to build and keep fans.” 

“So many companies are obsessed with going viral, ROI (which is important), and creating something they think is cool, that they forget why they are doing it. Building fans and purveyors of quality takes time and not every campaign or interactive experience you install will hit the mark,” adds Rodriguez. 

“Sometimes it hits the mark but the reaction is delayed. There is no way to measure whether someone saw a great campaign or experienced a digital innovation you created and if that led them to buy months down the road. But the reality is those authentic and real moments stick with people and it takes time [...] The focus should be continuing to be authentic and real — negotiating and editing with successes and failures, but never wavering on those two things.” 

Rodriguez points to Nordstrom and Tesla as examples of retailers that understand the importance of authentic, real customer experiences that are easy and memorable.

“Retailers should remember that not every product or outcome is tangible,” shes says. “Interactive experiences at Tesla showrooms in malls allow consumers, who would otherwise not be able to afford the car or wouldn’t go out of their way to visit a dealership, to build and interact [with a virtual vehicle]. They provide a boutique experience which draws in consumers based on emotion, feelings of nostalgia, and even sex. It puts something out of reach directly into their hands.”

Rodriguez appreciates how Nordstrom varies store design elements and floor plan layouts for different customers and how important balanced design is to the customer experience. “They aren’t afraid to experiment and try new things to see how it affects their broad range of target markets,” she says. “Nordstrom understands the importance of providing varying experiences for many types of consumers, creating pop-ups that change out quarterly (sometimes more frequently), curb-side service, personal shoppers, and even a bar just beyond the most shopped area to loosen up shoppers’ inhibitions and their wallets.” 

Data Drives Design

To know your customer is to know your retail business. The correlation between a retailer's profitability and the customer experience is closer than ever in retail history. For physical retail stores, this experience is connected to the customer’s surroundings — how they navigate the store’s environment, and the flow of attention they spend on your merchandise and messaging. 

The digital, online retail experience follows a similar principle. The design of a website or mobile application, and the user experience the layout creates, is critical to creating value for a customer and in return, has a positive impact on the retailer’s profitability. 

For Rodriguez, data emphasizes the importance of design in the overall customer experience and is a core part of any successful retail design playbook. “Data is essential to creating a memorable and effective experience,” she says. “For online experiences, there must be a mix of testing and best practices.” 

According to Rodriguez, at Microsoft the data collected from customers interacting with digital screens might include the following:

  • Tracking time spent in experience
  • Hot spots (how the customer interacts with the device’s screen)
  • Click Through Rates (CTRs)
  • Impact to sales (ROI)
  • Analysis of other sales/promos during that time to influence

Rodriguez further explains that once data is collected and analyzed and an update is needed, it should happen quickly. If the tests are successful, the formula should be documented and repeated. Using data to design and plan physical or digital retail layouts with the overall experience in mind creates value for customers.  

“Retailers should not make assumptions about their clientele or only make decisions based on their personal experiences, wants, and needs,” says Rodriguez. She adds a reminder to retailers about the importance of aligning the desired experience of the target customer with retail management and the overall retail strategy. She recommends looking to market research and customer data to make the most impact, remembering that executive leadership, for example, may have a store design strategy that data shows is not aligned with the target customer experience. 

“People want their experience to be individualized. [Customers] have become fickle and often are annoyed by an overabundance of help, even if they need it,” she adds. “Algorithms and data are scary to most consumers, but when they realize how it can help to filter and tailor their experience to exactly what they need and want, even before they know they need or want it, the retailer then becomes priceless.” 

The Multi-Channel Mindset

Connecting the customer experience with a mobile friendly retail strategy is important, as people are increasingly dependent on their mobile devices and interacting with the digital world throughout the day. Retail customers use their mobile devices to stay connected throughout their shopping experience. This might include checking prices and inventory availability, or using their device to find physical store location and hours.  

“As a mobile-first world, we sometimes must forgo the shiny experiences and provide a user with a friendly, value proposition-focused customer journey with fewer clicks to get consumers where they need to be,” says Rodriguez. Part of a sound mobile-first retail design strategy, when considering your ecommerce site or mobile application, is simplicity. Mobile design strategy means impacting the customer experience by making shopping easier. 

“From an online perspective, the customer journey should be straightforward, user friendly, and require as few clicks as possible to get the customer where they want to go,” says Rodriguez. “Many consumers stick with what they know until they see the value. Often, this is due to habit or lack of energy to create a new account, enter information, etc.” 

Rodriguez believes that the more a retailer does to simplify purchasing, the more value they add to the customer experience. She uses Amazon’s strategy for linking new services and products based on the customer’s purchasing habits as an example of the “ease of purchase” experience retailers should strive for. 

“Amazon Go and Amazon.com provide ease of shopping at your fingertips without the hardship of dealing with, well, anyone,” says Rodriguez. “This footprint is a great example of how to bring a digital experience into a brick and mortar reality. While they continue to test, their key to success is measuring, monitoring, and reacting quickly to individual consumer needs.”

Mobile applications provide an opportunity for retailers looking to make purchasing simple and easy, whether the customer chooses the brick-and-mortar or digital shopper journey. “Stores with robust mobile apps can add on everything from triggering [...] a mobile push alert when [the customer’s] within a certain distance from a store location,” says Rodriguez. This alert might notify customers of an in-store event or send a specific deal on seasonal merchandise based on the geo-location of the customer. 

“Retailers willing to push the limits of their applications (and spend development dollars) can also use apps to track [in-store] customers and remind [them] of sales or products currently in their cart, request service on the floor with their mobile device, or forgo any interaction with sales reps by ordering everything on their device via scanning barcodes or shopping available stock to have it ready for them at the register,” she adds.   

Video Is a Game Changer

Using video to enhance the digital experience and create customer interaction is a game changer. “Video is key,” says Rodriguez. “Studies show that video on home or product pages have conversion rates between 80-100 percent.” Rodriguez recommends using video in “short, snackable bites.” In addition to online advertising and store branding opportunities on social media platforms like Facebook and Snapchat, the reduced cost of digital displays and user friendly digital video tools provides retailers with creative, affordable ways to design their stores to leverage video. A couple examples of leveraging interactive video display include the following:

  • Touchscreens: Customers spend an increasing amount of their day interacting with their mobile devices and retailers can leverage this habitual behavior. “Consumers will try to interact with any type of screen out of habit,” says Rodriguez. “This is an opportunity to quickly educate consumers, update content remotely, compare products, and share ratings, reviews, or tech specs.” Rodriguez claims most retailers and businesses using touchscreen presentations or video displays are not taking full advantage of their power. “Most are basically PowerPoint [presentations], or the screens aren’t cared for, or they are turned off, or broken.” She cautions that “customers are too smart and tech savvy” and using this technology in the wrong way can quickly turn a positive effort into a negative customer experience.
  • Streaming Content: Rodriguez highlights a unique in-store content marketing trend for retailers to engage customers. Combining store design and digital technology, retail stores can use strategically placed screens to connect customers to their overall brand message or targeted marketing campaigns. “[...] the online journey should be done first (or in tandem with) the [digital] campaigns and store footprint,” says Rodriguez. “[Digital] experiences are often seen as separate, but the goal should be to create a seamless experience whether the customer is on their desktop at home, their mobile phone, or physically in the store.” 

Sensor Technology

Specialized sensors provide data and interactive customer experiences using video and internet of things (IoT) technology. Sensors benefit retailer and customer, as the data gathered from their use provides insight into customer flow and purchasing behavior. Rodriguez highlights Disney’s use of wristbands to provide visitors with a personalized experience. The device can unlock the hotel room door and change imagery on digital screens to match the visitor’s experience of choice. “This isn’t a tangible thing, but provides a sense of belonging, delight, and memories that will build and keep fans coming back for more for generations to come,” she says. The following are examples of different types of sensor technology that are relevant to retail store design:

  • Heat Maps : A heat map is a visual representation of data. In retail, this data displays how customers interact with merchandise and navigate the retail environment in physical stores using video surveillance to map movement. Heat map technology provides data for online retailers as well, plotting data, and visualizing how a customer navigates and interacts with a website using their mouse for example. 
  • Phidgets : Phidgets are sensors, often used in robotics, that manage different environmental elements. There are many uses for phidget technology, according to Rodriguez. “These are basically sensors that come in a wide array of options such as distance, heat/cold sensing, and seismic,” she says. “There are fun ways these can create interactive experiences, triggering an event when the product is handled and even changing content on the screens when a person approaches the display.”
  • Radio Frequency Identification (RFID) Sensors: According to Rodriguez, RFID technology is becoming more popular as retailers experiment with more uses for the sensors including inventory management. “With [RFID] gates installed, supply chain management becomes easier. A retailer can use the tags to sense when a product has moved from the back room to the floor, activate an experience on a screen once a product is picked up or moved, and can take the place of the old barcode system,” she says.  

Top Store Layout Design Strategies that Impact the Customer Experience

Moving merchandise from the end of the supply chain to the customer is a retailer's primary function. Successful retailers do so by creating value and delivering a differentiated customer experience. How customers experience your merchandise is determined by how your store is designed to guide them to interact with it. A retail management strategy that successfully leverages store design to drive customer flow and create unique experiences is a big part of your overall retail brand. It is a proven method for producing the kind of value that keeps retailers competitive and profitable.

Allison Walze

Allison Walzer , Sr. Retail Channel Marketing Manager at Microsoft, believes store design is a direct reflection of your brand and a vital part of staying competitive with e-commerce trends.

“One of the main challenges for stores is how they will stand out from competitors and a busy [retail] marketplace,” says Walzer. “How do they create the convenience and experience to drive customers to come into the store?”

“Store design really has to stand out from the pack right now,” she says. “It’s crucial for brick-and-mortar stores to create experiences that encourage people to visit stores.”

Visual Merchandising Strategy

Visual merchandising is a core retail strategy. It is the “language of the store,” writes Ebster — the way retailers communicate with the customer through visual imagery and the presentation of merchandise. Part art and part science, visual merchandising involves everything that helps create a unique customer experience. The well-lit entryway, the strategically placed furniture, fixtures, and promotional displays combine with the store layout to influence customer behavior and make the customer’s journey efficient, unique, and memorable. 

“[We] are noticing a turn to lifestyle- and experience-driven retail experiences,” says Walzer. “Stores are integrating materials from home or outdoors to create a comfortable, beautiful shopping space that leads to longer dwell time in stores.” She describes a visual merchandising strategy that luxury brand retailers use to promote health and beauty by placing living plants inside their stores. 

Visual merchandising brings together the overall environment of the retail store. It is a strategic element in retail management that distinguishes a retailer from the competition. The type of merchandise offered is a crucial consideration in the how the retailer influences uses visual merchandising elements to target customers. As Malcolm Gladwell writes in his feature article, “The Science of Shopping,” “the clothes have to match the environment.” 

Walzer recommends that retailers deciding how to plan for visual merchandising elements that work for their concept consider their customer flow in a way that guides the customer through “the path to purchase.” 

“Aesop is killing it right now,” says Walzer, when asked about retailers that highlight the importance of store design. “Their stores are beautiful and each one is different and contextual while still keeping in step with their brand. They concentrate on materials and even acoustics to create a personal environment. Each shop is individual and takes the environment and city into account when building a new store. It’s the right approach to make a memorable shopping experience and delights customers with its idiosyncratic design-led principles.”

The visual merchandising techniques that a retailer chooses can alter the customer’s perception of the retailer’s value. Ebster recommends looking at visual merchandising from the customer’s perspective. For more retail merchandising tips and best practices from experts and researchers, check out “ The Art and Science of Retail Merchandising .” 

Zone Merchandising Strategy 

Customers also respond to where products are placed. A zone merchandising strategy combines visual merchandising with your store layout design to highlight high-margin merchandise or merchandise you want featured. Creating zones using walls, merchandise displays, and signage develops semi-separate areas. Merchandise displays are set up as speed bumps to keep the customer in the zone and slow them from leaving the area. 

“Stores need to be thoughtful in their layout, and have clear zones so navigation is easy. Not everyone likes to ask sales assistants for directions,” says Walzer. She recommends creating “instagrammable” moments in-store. “Make it fun and easy for people to share their stories on social media,” she says. This includes using hashtags in messaging, or on merchandise displays, creating “set-designing” zones, and favoring natural light with “unique designs that make for cool backdrops or host events.”

Lighting Strategy

Proper lighting is more than just making sure the customer can see and interact with the merchandise. When done well, light can help structure and influence the customer’s mood while shopping. 

Store planners and designers use lighting solutions to highlight or downplay specific areas of the store to draw in customers and create an environment that works in sync with the retail brand and the merchandise offered. Lighting specialists provide expertise in the appropriate types of lighting for specific store layouts, based on natural light exposure, and can recommend solutions that suit budgets and environmentally conscious business models.

Signage Strategy

Signs serve multiple purposes for retailers. They are the graphic representation of the retailer's brand and merchandise. Signs provide product information for specific merchandise, help customers navigate the store layout efficiently, and create the desired price perception. Retailers should keep signs fresh and updated based on the merchandise offered, the season, or specific promotions. Keep in-store signs and messaging consistent with the brand voice and use standard fonts and colors that are easy to identify and read with your lighting. 

“From a strictly visual perspective, it’s key to have clear readable signage from the outside that leads customers in the store. From there, plan the customer journey from [a] high level,” says Walzer. She recommends using signage that encourages overall shopping (for example, placing old and iconic imagery - specifically for tech stores - towards the front of the store). When the customer arrives at specific merchandise, or the “buy level,” use signage that builds the buy messaging. 

Display Strategy 

The word “display” comes from the French word “deployer”, which means “to unfold.” Far from being exclusive to clothing, however, promotional displays help “unfold” the merchandise you offer to the customer. Along with your store layout design, displays set the stage for your customer’s overall experience when navigating the store. In general, displays come in all shapes and sizes, and refer to the movable units in the store that feature merchandise such as tables, racks, or gondolas. 

Careful selection of the type and placement of displays is crucial to the overall retail strategy of using space management and store design to influence customer flow and in-store behavior. Also, treat displays as flexible, cost-effective investments and ask your product manufacturers and suppliers about providing low-cost options specific to their products and brands.

Fixture Strategy

If displays are the flexible, freestanding, and modular units used to present merchandise, then fixtures refer to the more permanent units in the store. Counters, wall mounted shelving units, support columns, and bench seating are examples of fixtures. The purpose of fixtures is to coordinate your store layout and influence customer flow and interactions. In other words, they are designed to impact the customer flow and bring attention to merchandise in a consistent, familiar environment. 

In general, fixtures are less versatile than displays and in-store design layouts, but when planned carefully, they become a defining part of a retail space. Walzer recommends minimal, clean, and uncluttered fixtures, and modular signage areas to promote offers. Fixtures need to drive a premium look and feel. Materials that are “authentic and have some warmth to them” work best (real wood versus laminate, stone or marble versus coated plastic, glass versus acrylic).    

“Fixtures should be made from premium authentic materials that are durable and uplevel the experience,” says Walzer. “If the table is shoddy and falling apart, why would you want to buy what is merchandised on it?” 

Window Strategy

Windows welcome customers from the outside and draw them into the store where layout design and the various elements of visual merchandising go to work. The window display requires careful attention to lighting, size of display units, type of merchandise featured, props (like mannequins), and signage. Because the customer has yet to enter the store, a window display must combine all of the visual merchandising elements to successfully pique the customer’s interest and promote the retailer’s brand and personality. 

Communal Design Strategy 

Concentrate on how to create community and engagement with store design. “What makes a consumer want to come and repeatedly spend time in a retail store in the digital age will be based on the feeling you get when you are shopping,” says Walzer. “Create a rapport with the customer, pull in elements from the community as part of the design inspiration. If there is a local artist or ceramist or musician, use those pieces in the stores.” Walzer mentions the Seattle-Tacoma International Airport showcasing Sub Pop artists and Pearl Jam artwork as an example. “[They] are currently doing a great job. It’s creating pride for residents and a sense of joy for travelers, who are also customers that purchase Sub Pop gear at the store.”  

Other Space Management Considerations

As discussed, the visual presentation of merchandise and the influence of store layout design is vital to retail strategy. There are also functional considerations involved in the overall store layout that impacts the customer experience. One example is to keep design functional with the overall space. 

“It’s not so much about the space as how the space is designed,” says Walzer. “If it’s a crowded or awkward space, build in open walkways, keep merchandising elegant. If it’s a large space, don’t let it look too cavernous. Create walkways to guide the purchase journey with easy wayfinding.” 

The following is a list of additional space management factors to consider:

  • Legal Requirements: Review the standards issued under the Americans with Disabilities Act (ADA) to understand the legal requirements for retailers in the United States. For example, the ADA requires a minimum of three feet of aisle width for customer accessibility. Consult with qualified professionals if you’re planning changes to your store layout design that may impact customer accessibility. 
  • Seating: Provide customers with comfortable seating to enhance the overall customer experience and slow customers down. Clothing stores with dressing rooms are the primary example of this strategy in use. According to Ebster, an extended store visit increases the likelihood that customers make a purchase.
  • Checkout: The checkout area of a retail store is critical to more than cash handling and payment processing. This space accommodates all customers and a variety of interactions, and is typically the last area to make an impression on customers. Depending on the store layout, the checkout area provides additional visual merchandising opportunities. Retailers use this space to encourage impulse purchases of complementary merchandise while customers wait to pay.
  • Back-of-the-House Operations: The retail store layout should factor for store operations and activity like shipping and receiving, inventory storage and retrieval, and the employee’s overall workspace and break area. Storage options are essential to the overall store layout design because it impacts how much merchandise you will feature on the sales floor where customers navigate. Ebster recommends keeping the customer in a flow state and focused on shopping. Therefore, maintaining back-of-the-house operations concealed from customers is a visual merchandising strategy.

Retail Store Layout Design and Planning Resources

Store layout planning and design is a profession all its own. The design knowledge and planning skills required to develop an entirely new retail store, modify an existing floor plan, or even remodel a specific area of your store is a daunting task for retailers focused on attracting customers and earning revenue. The good news is that an entire network of design professionals, store planners, project managers, architects, contractors, and more operate and serve in the largest private sector employment category of the U.S. economy. The following resources are available to retailers looking to explore store layout design and planning: 

  • National Retail Federation (NRF) : The NRF is the world’s largest retail trade association. Operating in the U.S. and in 45 countries, their mission is “to advance the interests of the retail industry through advocacy, communications, and education.”
  • Retail Design Blog: Architects, designers, visual merchandisers, retailers, brand managers, and fans submit pictures and projects about retail design. It includes store and exhibit design, fashion merchandising, visual merchandising content, and more.
  • Store Design and Visual Merchandising: The website design:retail covers retail trends, products, and projects, and publishes an aggregate list of products and services. 
  • Retail Design Institute: The Retail Design Institute is the largest and oldest not-for-profit store planning and design organization. Founded in 1961, members include architects, graphic designers, lighting designers, interior designers, store planners, visual merchandisers, resource designers, brand strategists, educators, trade partners, trade media, and students of design. The website publishes a list of design resources .
  • American Society of Interior Designers (ASID): ASID is a multi-disciplinary professional organization for interior designers, students, and retail manufacturers and suppliers that satisfy the organization's acceptance standards for accreditation. Members receive access to services by industry experts in legal assistance, human resources, liability and disability insurance, and more.
  • NCIDQ Certified Interior Designer: NCIDQ Certification tests for industry design standards, and for public health, safety, and welfare. More than 30,000 people are NCIDQ certified, an international standard for interior design professionals by The Council for Interior Design Qualification (CIDQ).
  • VMSD (Visual Marketing and Store Design) : The VMSD magazine and website provides retail professionals with “innovative retail design ideas, visual presentations, new products, merchandising strategies, and industry news and events.” VMSD hosts the annual International Retail Design Conference (IRDC)   
  • Pinterest : Explore store design concepts and ideas through photography and project images posted by a variety of sources. 

Retail Store Layout Software

One application you can use to create diagrams of store layouts is Google Drawing, a free software application available in the Chrome Web Store . For store planners, retail consultants, design professionals, or the aspiring DIY retailer, there is a market for drawing and floor planning software to help you create professional retail store layouts. 

The following list of solutions offers diagramming tools that let you customize existing store layout templates and explore different design ideas. Drawing software provides libraries of design elements for architecture, furniture, fixtures, and floor plan specific symbols. Like most SaaS (software-as-a-service) solutions today, some of the solutions listed below offer customer support and tutorials, cloud hosting features, and software integration with your existing store management software and standard operating systems. 

  • Microsoft Visio
  • EDrawSoft Floor Plan Maker
  • ConceptDraw PRO 
  • FloorPlanner
  • Lucidchart Floor Plan Software

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How to Write a Business Plan For a Retail Store: Complete Guide

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  • August 3, 2022
  • Small Businesses

retail design business plan

Whether you’re looking to raise funding from private investors or to get a loan from a bank (like a SBA loan) for your retail store, you will need to prepare a solid business plan.

In this article we go through, step-by-step, all the different sections you need in your retail store business plan. Use this template to create a complete, clear and solid business plan that get you funded.

1. Executive Summary

The executive summary of a business plan gives a sneak peek of the information about your business plan to lenders and/or investors.

If the information you provide here is not concise, informative, and scannable, potential lenders and investors will lose interest.

Though the executive summary is the first and the most important section, it should normally be the last section you write because it will have the summary of different sections included in the entire plan.

Why do you need a business plan for a retail store?

The purpose of a business plan is to secure funding through one of the following channels:

  • Obtain bank financing or secure a loan from other lenders (such as a SBA loan )
  • Obtain private investments from investment funds, angel investors, etc.
  • Obtain a public or a private grant

How to write your retail store business plan’s executive summary?

For any retail business, the following information must go into the executive summary:

  • Business overview : include your business name and model (independent retail store or franchise model), the products you intend to sell (and whether you want to expand with additional product offerings), the legal structure of your business, etc.
  • Market analysis : how many retail stores operate in your area and what do they sell? The estimated number of visitors your customers receive per week, target audience demography (the products you sell must fulfill their needs), purchasing power, etc. must also be included
  • People : organizational setup and the management hierarchy along with retail store experience of the key people in the management
  • Financial plan : how much profit and revenue do you expect in the next 5 years? When will you reach the break-even point and start making profits? It is ideal to include a chart depicting your key financials such as revenue, gross profits, and net profit
  • Financial ask : what loan/investment/grant are you seeking? How much do you need? How long will this last?

retail design business plan

2. Business Overview

The business overview is essentially the company description. The second section of your business plan, it should cover the following for a retail store:

  • The products you will sell in your store
  • The price range of the products
  • The company structure
  • Target audience information

Let’s look at different subsections that you must include:

Give a brief explanation of why you want to open a retail store. It must display two things:

  • Your passion & interest for this type of business
  • Feasibility of the business

There may be other retail stores in your area, but they don’t fulfill certain needs of the potential customers. Your business may fill in that gap. 

For example, there may not be any retail store in your area addressing the needs of cyclists. Even if there are competing retail stores, are they offering everything like electric bikes, mountain bikes, touring bikes, BMX, folding bikes, etc.? Do they offer spare parts and customizations?

b) Business Model

This is where you will explain the following:

  • Is your retail store independent?
  • Are you buying an existing retail store?
  • Are you settling for a franchise store of an established bike brand?

c) Products

Your retail store can sell various products. Lenders or investors must get a clear idea of the products you intend to sell. If you want to focus on one or two specific products, you must clarify that, too.

For instance, if you are opening a retail bicycle or bike store , do you intend to sell only assembled bikes or do you intend to sell spare parts, too? What about toolkits? Do you have plans to sell supporting products for cyclists such as helmets, pants, shorts, gloves, eyewear, etc.?

If you have plans to specialize in something (for example, mountain bikes with shock absorption, gears, disc brakes, etc.), mention that.

retail design business plan

d) Pricing Strategy

It is important that you add a pricing list here. You don’t need to go into extreme details. Just an average range will be more than enough. 

For instance, mountain bikes can cost anywhere between $400 and $800 . Depending on the components used, the average price can increase or decrease.

A pricing chart for all major products you are offering can help the investors or lenders to tie your pricing strategy with your financial projections.

e) Target Audience

Knowing your customers is very important. That will give you an edge over your competitors. For example, if you are opening a retail bicycle store, you must know whether your potential customers will be enthusiasts, hobbyists, or professionals.

Another important aspect is to understand the type of cyclists you will focus on. The products you sell will depend on that.

Knowing your customers well help in two things:

  • You can better retain your customers
  • Lenders or investors will be more confident about your business strategy

f) Legal Structure

Finally, your business overview section should specify what type of business structure you opt for. Is this a corporation or a partnership (LLC)? Who are the investors? How much equity percentage do they own? Is there a Board of Directors? If so, whom? Do they have experience in the industry?

3. Market Analysis

The market analysis is the next most important aspect of your retail store business plan. You must demonstrate to the potential investors that you know your market. Investors must be confident that the retail store you are trying to open (or you are already operating) makes sense.

For example, if you want to open a retail store specializing in mountain bikes, it’d be better if you’re located in states like Utah, Arizona, Arkansas, Colorado, North Carolina, Michigan, etc., because these states have ideal mountain bike destinations. Similarly, Texas isn’t really popular for mountain biking.

Again, you will never want to sell high-end bikes in a middle class neighborhood because they will most likely not be able to afford those items.

a) Retail Market Trends

You must also focus on the market size and growth opportunities. For example, if the location of your retail store doesn’t have enough cyclists, your bicycle business will probably not make enough profits. Again, if there are way too many competitors, the growth opportunities may be stifled.

Find market data for your city / area

It is always a good idea to get city-level data to get a clearer picture of the market size in addition to any national-level data you are providing.

Getting city level data might not be an easy task. In fact, you may have to get out and collect the necessary data. You may have to do some math. For example, if there were 30 bicycle retailers in your city in 2019 and the number grew to 33 in 2020, the annual growth rate will be 10%. 

You may want to investigate the factors leading to such growth. For instance, median income may have increased, there may be an influx of population, growing environmental consciousness, increased health awareness, etc., can be some of the factors.

However, you may actually notice a drop. In such a case, you must investigate the reasons. There can be varied factors like drop in income (and hence, sales that led to closure of businesses), decrease in population (may be younger popular moved out of the location), etc.

If there is a drop, you must explain the rationale behind opening a business, the industry of which is showing a gradual decline. It may also happen that the market may rebound back after a temporary decline.

retail design business plan

b) Competition

Your competitor analysis is very important. Here are a few questions that you must answer:

  • How many retail stores are there?
  • How many of those stores are your direct and indirect competitors?
  • What type of products do your competitors sell?
  • What is the price your competitors are charging for the same or similar product?
  • How many employees do your competitors have on an average?
  • How many customers do they receive per month?

Some of the answers will end in approximation of data. That’s totally fine. For example, you may not be able to get the exact number of customers your competitors receive.

Draw a strong conclusion for your competitive analysis

Your competitive analysis must bring out the reasons why you are trying to open a retail store. For example (related to the retail bicycle store example):

  • There are no specialised mountain bike retailers in the area despite a high percentage of mountain bikers
  • Existing bike retailers offer only bikes and spares. No retailer offers clothing and protective gear

c) Customers

You already spoke about the target audience in the Business Overview section. Here, you must provide hard data that establishes the existence of your potential customers in the area.

This section must answer the following questions (with reference to the bike store example):

  • What is the age group of the cyclists in your area?
  • What percentage of the cyclists are women vs. males?
  • What type of bikes are they mostly interested in?
  • Do the customers also look for related accessories?
  • Do they prefer online shopping or offline shopping?
  • What is the average household income per month (and also their average disposable income)?

Much of this hard data will come from your competitor analysis. Also, the data must support your decision to open a retail store. For example, if people have a tendency to buy online, you may be better off opening an online retail store instead of a physical store.

retail design business plan

4. Sales & Marketing Strategy

The 4th section of your retail store business plan is where you outline your customer acquisition strategy. Try to answer the following questions:

  • What is your USP?
  • What marketing channels will you use (online or offline)?
  • Do the marketing channels aptly grab the attention of your target audience? For instance, young adults will most likely not pay attention to TV ads. Instead, use social media
  • How do you intend to track the success of your marketing strategy?
  • What is your CAC or customer acquisition cost?
  • What is your marketing budget?
  • What introductory promos and offers do you intend to provide for attracting new customers?

Let’s expand a bit on a few questions below:

a) Marketing channels

A few marketing channels retail stores typically use are:

  • Email marketing
  • SMS marketing
  • Social media
  • Pay-per-click campaigns (e.g. Google Ads, Amazon Ads)
  • Partnerships (e.g. with companies to offer employees coupons, discounts, etc.)

retail design business plan

b) What is your unique selling proposition?

In other words, how do you differentiate yourself vs. competitors? This is very important as you might need to win customers from competitors.

A few examples of USPs are (with reference to retail bike store example):

  • Price : you may have cheaper prices than competitors
  • Specialization : you may be specializing in some specific product
  • Additional products : you sell additional accessories and safety gear that your competitors don’t
  • Freebies : you may offer freebies like helmets or tail lights

Your USP will definitely depend on the products you are selling.

5. Management & Organizational Structure

You must address two things here:

  • The management team and their experience / track record
  • The organizational structure: what are the different teams and who reports to whom?

a) Management

Your store’s management will vary depending on the business type and size. For instance, if you are opening a franchise store, you may have to give a lot more details compared to an independent store.

You may have co-founders and/or senior managers. You must explain their roles, too. Apart from that, you must also explain their industry experience and why they are suitable for those positions.

b) Organizational structure

Note that even if you have not already hired senior managers and other team members, you must include the details. 

You must define their roles and the hierarchy of reporting. This will demonstrate to the potential lenders and investors the solid management plan you have in place to operate your business efficiently and successfully.

Create and attach an organizational chart for a visual understanding of your store’s staff and their reporting lines.

retail design business plan

6. Financial Plan

The financial plan is perhaps, with the executive summary, the most important section of any retail store business plan.

Indeed, a solid financial plan tells lenders that your business is viable and can repay the loan you need from them. If you’re looking to raise equity from private investors, a solid financial plan will prove them your retail store is an attractive investment.

There should be 3 sections to your financial plan section:

  • Your historical financials (only if you already operate the business and have financial accounts to show)
  • The startup costs of your project (if you plan to open a new retail store, renovate your store, etc.)
  • The 5-year financial projections

Historical Financials (if any)

In the scenario where you already have some historical financials (a few quarters or a few years), include them. A summary of your financial statements in the form of charts e.g. revenue, gross profit and net profit is enough, save the rest for the appendix.

If you don’t have any, don’t worry, most new businesses don’t have any historical financials and that’s ok. If so, jump to Startup Costs instead.

Startup Costs

Before we expand on 5-year financial projections in the following section, it’s always best practice to start with listing the startup costs of your project. For a retail store, startup costs are all the expenses you incur before you open the space to your customers. These expenses typically are:

  • The lease deposit for the space you rent
  • The design and renovation of the existing facilities
  • The equipment and furniture

The total startup costs depend on a number of factors, such as the size of your store, the quality of the building (whether there is a lot or remodeling to do or not), the quality of the furniture, etc.

Financial Projections

In addition to startup costs, you will now need to build a solid financial model over 5 years.

Your financial projections should be built using a spreadsheet (e.g. Excel or Google Sheets) and presented in the form of tables and charts in your business plan.

As usual, keep it concise here and save details (for example detailed financial statements, financial metrics, key assumptions used for the projections) for the appendix instead.

Your financial projections should answer at least the following questions:

  • How much revenue do you expect to generate over the next 5 years?
  • When do you expect to break even?
  • How much cash will you burn until you get there?
  • What’s the impact of a change in pricing (say 5%) on your margins?
  • What is your average customer acquisition cost?

You should include here your 3 financial statements (income statement, balance sheet and cash flow statement). This means you must forecast:

  • The number of customers over time ;
  • Your expected revenue ;
  • Operating costs to run the business ;
  • Any other cash flow items (e.g. capex, debt repayment, etc.).

When projecting your revenue, make sure to sensitize pricing and the number of customers, sales as a small change in these assumptions will have a big impact on your revenues.

retail design business plan

7. Use of Funds

This is the last section of your retail store business plan. Now that we have explained what your retail store sells and to whom, the industry, management and your marketing strategy, this section must answer the following questions:

  • How much funding do you need?
  • What financial instrument(s) do you need: is this equity or debt, or even a free-money public grant?
  • How long will this funding last?
  • Where else does the money come from? If you apply for a SBA loan for example, where does the other part of the investment come from (your own capital, private investors?)

If you raise debt:

  • What percentage of the total funding the loan represents?
  • What is the corresponding Debt Service Coverage Ratio ?

If you raise equity

  • What percentage ownership are you selling as part of this funding round?
  • What is the corresponding valuation of your business?

Use of Funds

Any business plan should include a clear use of funds section. This is where you explain how the money will be spent.

Will you spend most of the loan / investment in paying your employees’ salaries and the inventory? Or will it cover mostly the cost for the lease deposit and the renovation of the building?

Those are very important questions you should be able to answer in the blink of an eye. Don’t worry, this should come straight from your financial projections. If you’ve built solid projections like in our retail store financial model template , you won’t have any issues answering these questions.

For the use of funds, we recommend using a pie chart like the one we have in our financial model template where we outline the main expenses categories as shown below.

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Retail Business Plan Template

Written by Dave Lavinsky

Growthink.com Retail Business Plan Template

Over the past 20+ years, we have helped over 10,000 entrepreneurs and business owners create business plans to start and grow their retail businesses. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a retail business plan template step-by-step so you can create your plan today.

Download our Ultimate Retail Business Plan Template here >

What Is a Business Plan?

A business plan provides a snapshot of your retail business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Retail Business Plan

retail clothing

Sources of Funding for Retail Businesses

With regards to funding, the main sources of funding for a retail business are bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable. But they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business.

The second most common form of funding for a retail business is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding, or, like a bank, they will give you a loan. 

Venture capitalists will not fund a retail business. They might consider funding a chain, but never an individual location. This is because most venture capitalists are looking for millions of dollars in return when they make an investment, and an individual location could rarely achieve such results.

Finish Your Business Plan Today!

Retail business plan template example.

Your business plan should include 10 sections as follows:

Executive Summary

retail business plan merchandise

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of retail store you are operating and the status; for example, are you a startup, do you have a retail business that you would like to grow, or are you operating a chain of retail businesses.

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the retail industry. Discuss the type of retail store you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.

Company Analysis

In your company analysis, you will detail the type of retail business you are operating.

For example, you might operate one of the following types:

  • Speciality Store – a store with a tight focus (e.g., hip apparel for women)
  • Off-Priced/Used Goods Store – sells massively discounted or used products
  • Department Store – often located at a mall and offer tons of products (e.g., Macy’s)
  • Supermarket – focuses primarily on food items
  • Convenience Store – offers just the most popular items a supermarket offers in a much smaller location
  • Drug Store/Pharmacy – primarily offer medicines and medical products
  • Discount Store – offer large inventories at low prices (e.g., Walmart)
  • Hypermarket – offer many food and non-food items often in large quantities at a discount (e.g., Costco)
  • E-commerce – offers products for sale online (e.g., Amazon)

retail business salesperson

Include answers to question such as:

  • When and why did you start the business?
  • What milestones have you achieved to date? Milestones could include sales goals you’ve reached, new store openings, etc.
  • Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the retail business.

While this may seem unnecessary, it serves multiple purposes.

First, researching the retail industry educates you. It helps you understand the market in which you are operating. 

Secondly, market research can improve your strategy particularly if your research identifies market trends. For example, if there was a trend towards local retail businesses with online counterparts, it would be helpful to ensure your plan calls for a significant online presence.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your retail business plan:

  • How big is the retail business (in dollars)?
  • Is the market declining or increasing?
  • Who are the key competitors in your local market?
  • Who are the key suppliers in the market?
  • What trends are affecting the industry?
  • What is the industry’s growth forecast over the next 5 – 10 years?
  • What is the relevant market size? That is, how big is the potential market for your retail business. You can extrapolate such a figure by assessing the size of your niche’s market in the entire country and then applying that figure to your local population.

Customer Analysis

retail lighting

The following are examples of customer segments: college students, sports enthusiasts, soccer moms, techies, teens, baby boomers, etc.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of retail business you operate. Clearly baby boomers would want a different atmosphere, pricing and product options, and would respond to different marketing promotions than teens.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most retail businesses primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other retail businesses. They are most likely local businesses who sell similar items to you.

Indirect competitors are other options that customers have to purchase from you that aren’t direct competitors. You most likely will have online competitors; companies that sell the same or similar items to you, but which operate online.

retail business shop owner

  • What types of customers do they serve?
  • What products do they offer?
  • What is their pricing (premium, low, etc.)?
  • What are they good at?
  • What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. Look at review websites to gain this information.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

  • Will you provide superior products or services?
  • Will you provide products that your competitors don’t?
  • Will you make it easier or faster for customers to acquire your products?
  • Will you provide better customer service?
  • Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

Marketing Plan

retail business plan merchant

Product : in the product section you should reiterate the type of retail business that you documented in your Company Analysis. Then, detail the specific products you will be offering.

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the items you offer and their prices.

Place : Place refers to the location of your retail business. Document your location and mention how the location will impact your success. For example, is your retail business located next to a heavily populated office building, or gym, etc. Discuss how your location might provide a steady stream of customers. Also, if you operate or plan to operate kiosks, detail the locations where the kiosks will be placed.

Promotions : the final part of your retail business marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

  • Making your storefront extra appealing to attract passing customers
  • Social media marketing
  • Search engine optimization
  • Advertising in local papers and magazines
  • Reaching out to local bloggers and websites 
  • Partnerships with local organizations
  • Local radio advertising
  • Banner ads at local venues

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your retail business such as serving customers, procuring inventory, keeping the store clean, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to serve your 5,000th customer, or when you hope to reach $X in sales. It could also be when you expect to hire your Xth employee or launch a new location.

Management Team

store owner

Ideally you and/or your team members have direct experience in the retail business. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in retail businesses and/or successfully running retail and small businesses.

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you serve 100 customers per day or 200? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets : While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities. For instance, if you spend $100,000 on building out your retail business, that will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $100.000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt. For example, you may need to purchase inventories now that you can’t sell (and get paid for) for several months. During those months, you could run out of money.

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a retail business:

  • Location build-out including design fees, construction, etc.
  • Cost of fixtures
  • Cost of initial inventory
  • Payroll or salaries paid to staff
  • Business insurance
  • Taxes and permits
  • Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your store design blueprint or location lease.

Retail Business Plan Summary

Putting together a business plan for your retail business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert on retail business planning and know everything you need about writing a retail store business plan. You will really understand the retail business, your competition and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful retail store.

Download Our Retail Business Plan PDF

You can download our retail business plan PDF here . This is a business plan template you can use in PDF format.  

Retail Business Plan FAQs

What is the easiest way to complete my retail business plan.

Growthink's Ultimate Retail Business Plan Template allows you to quickly and easily complete your Retail Business Plan.

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Retail Business Plan Template

Written by Dave Lavinsky

Retail Business Plan

You’ve come to the right place to create your retail business plan.

We have helped over 10,000 entrepreneurs and business owners create business plans and many have used them to start or grow their retail companies.

Retail Business Plan Template & Sample

Below is a retail business plan template to help you create each section of your retail store business plan.

Executive Summary

Business overview.

Artisan Home & Decor is a startup retail shop located in Pasadena, California. The company is founded by Joyce Hernandez, a retailer who has worked as a store manager of a local home decor store for nearly a decade. Joyce has recently graduated from California University with a Bachelor’s degree in Business Management. Now that she has gained real-world experience managing a store and the education on how to run a retail business, she is inspired to start her own company, Artisan Home & Decor. Joyce is confident that her ability to effectively manage employees, customer relationships, and retail operations will help her establish a profitable retail store. Joyce plans on recruiting a team of highly qualified sales associates, accountants, and buyers to help manage the day to day complexities of retail – marketing, sales, budgeting, sourcing, and purchasing.

Artisan Home & Decor will provide uniquely curated home decor products created by local artisans. The home decor shop will be the ultimate choice for customers in Pasadena who value one-of-a-kind pieces for their homes. Artisan Home & Decor will provide its customers with a refreshingly personalized shopping experience they can’t get anywhere else. The shop’s sales associates will be able to help customers find the perfect pieces to suit their individual preferences and styles.

Product Offering

The following are the products that Artisan Home & Decor will provide:

  • Lamps & Lighting
  • Throw Blankets
  • Photo Frames
  • Cookware Sets
  • Kitchen Gadgets
  • Kitchen and Bathroom Fixtures
  • Waste Baskets
  • Soap Dispensers

Customer Focus

Artisan Home & Decor will target home decor shoppers looking for a personalized experience and unique pieces in Pasadena. The company will target boomer, millennial, and gen z  consumers looking for unique decor for their homes, apartments, or condos. They will also target businesses looking for special pieces to furnish their corporate offices, waiting rooms, and lobbies. No matter the client, Artisan Home & Decor will deliver the best communication, service, and high quality products.

Management Team

Artisan Home & Decor will be owned and operated by Joyce Hernandez, a retailer who has worked as a store manager of a local home decor store for nearly a decade. Joyce has recently graduated from California University with a Bachelor’s degree in Business Management. Now that she has gained real-world experience managing retail stores and the education on how to run a retail business, she is inspired to start her own company, Artisan Home & Decor.

Joyce Hernandez has recruited her former assistant manager, Melissa Jacobs to come on board to help her manage Artisan Home & Decor. While Joyce will oversee the employees, day-to-day operations, and client relationships, Melissa will be the Inventory Manager. She will be in charge of sourcing, purchasing, and pricing all inventory. Melissa will work directly with suppliers to stock the retail shop with unique artisan pieces.

Melissa is a graduate of the University of California with a Bachelor’s degree in Interior Design. She has been working at a local retail home decor company for over a decade as an assistant manager. Melissa has an eye for design and keen organizational skills that will allow her to effectively manage Artisan Home & Decor’s one-of-a-kind inventory. Her communication skills will enable her to establish and maintain working relationships with artisans and suppliers.

Success Factors

Artisan Home & Decor will be able to achieve success by offering the following competitive advantages:

  • Friendly, knowledgeable, and highly qualified team of sales associates and interior design experts that are able to provide a personalized customer experience and help each client find the right home decor pieces to suit their preferences.
  • Artisan Home & Decor will bring fresh inventory into their retail store on a regular basis so there will always be something new for customers to check out. In addition to in-store sales, the company will sell pieces online through its website.
  • Artisan Home & Decor offers one-of-kind pieces created by local artisans to suit a wide variety of home decor styles and tastes. By purchasing from the shop, customers are supporting these local artisans and getting fresh decor that no one else will have.

Financial Highlights

Artisan Home & Decor is seeking $210,000 in debt financing to launch its retail business. The funding will be dedicated towards securing and building out the retail space and purchasing the initial inventory. Funds will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and marketing costs for print ads, website and SEO marketing initiatives, and association memberships. The breakout of the funding is below:

  • Retail space build-out: $25,000
  • Retail store shelving, displays, equipment, supplies, and materials: $40,000
  • Three months of overhead expenses (payroll, rent, utilities): $120,000
  • Marketing costs: $15,000
  • Working capital: $10,000

The following graph below outlines the pro forma financial projections for Artisan Home & Decor.

retail design business plan

Company Overview

Who is artisan home & decor.

Artisan Home & Decor is a newly established retail company in Pasadena, California. The new home decor shop will be the ultimate choice for people looking for uniquely curated one-of-a-kind furniture and other home products crafted by local artisans. Artisan Home & Decor will provide its customers with a refreshingly personalized shopping experience they can’t get anywhere else. The shop’s sales associates and experienced interior designers will be able to help customers find the right pieces to suit their preferences and styles.

Artisan Home & Decor will be able to provide a personalized shopping experience for serving customers in-store and online. The team of professionals and sales associates are highly qualified and experienced in interior design, home decor, and the customer experience. Artisan Home & Decor removes all headaches and issues of the home decor shopper and ensures all issues are taken care off expeditiously while delivering the best customer service.

Artisan Home & Decor History

Artisan Home & Decor is owned and operated by Joyce Hernandez, a retailer who has worked as a store manager of a local home decor store for nearly a decade. Joyce has recently graduated from California University with a Bachelor’s degree in Business Management. Now that she has gained real-world experience managing retail stores and the education on how to run a retail business, she is ready to start her own company. Joyce is confident that her ability to effectively manage employees, customer relationships, and retail operations will help her establish a profitable retail store. Joyce has begun recruiting a team of highly qualified sales associates, accountants, and buyers to help manage the day to day complexities of retail – marketing, sales, budgeting, sourcing, and purchasing.

Since incorporation, Artisan Home & Decor has achieved the following milestones:

  • Registered Artisan Home & Decor, LLC to transact business in the state of California.
  • Has a contract in place to lease the retail space.
  • Reached out to numerous local artisans to advise them on the upcoming retail shop in order to start getting supplier contracts.
  • Began recruiting a staff of sales associates, interior designers, an accountant/bookkeeper, marketing director, and assistant manager to work at Artisan Home & Decor.

Artisan Home & Decor Services

Industry analysis.

The retail industry in the United States is valued at over $4T currently and is forecasted to reach $4.9T by the end of 2022. This is up from $3.8T in 2019. After a decade of retail decline between 2010 and 2020, the market is rebounding at a surprising rate. There were twice as many store openings as closings in 2021 alone. The number of brick-and-mortar retail establishments is increasing even as ecommerce shopping has grown by 70% in the last three years.

The role of retail stores is evolving and industry operators are discovering in-store experiences are still vital from the customer perspective. Successful brick-and-mortar industry operators are incorporating ecommerce into their business models. Trends include providing ship-from-store and buy online, pickup in store options to give customers more flexibility in the way they can shop. Key success factors include the level of customer satisfaction, product selection, prices, and convenience.

Customer Analysis

Demographic profile of target market.

The precise demographics for Pasadena, California are:

Customer Segmentation

Artisan Home & Decor will primarily target the following customer profiles:

  • Millennial customers looking for one-of-a-kind home decor
  • Boomer customers looking for one-of-a-kind home decor
  • Gen z customers looking for one-of-a-kind home decor
  • Businesses looking for unique decor for their offices, waiting rooms, or lobbies

Competitive Analysis

Direct and indirect competitors.

Artisan Home & Decor will face competition from other retailers with similar business profiles. A description of each competitor company is below.

Pasadena Home Decor

Pasadena Home Decor provides high-end home decor for the conscientious consumer. Located in Pasadena, California, the home decor retailer is able to provide a tailored shopping experience for its customers. The store’s list of products includes tables, chairs, wall hangings, rugs, vases, photo frames, candles, office decor, and paintings by local artists. Pasadena Home Decor sells online and in-store to give customers flexibility.

Pasadena Home Decor’s promise is to deliver high quality pieces that will stand out. Customers who purchase furniture and home decor from Pasadena Home Decor will be delighted with the customer service, cleanliness of the store, and personalized design services the company offers.

Home Shoppe

Home Shoppe is a California-based home decor retail store that provides outstanding pieces for discerning clientele. Home Shoppe stocks unique furniture and other decor items that are 100% hand-crafted. The owners of Home Shoppe are experienced craftsmen themselves, so they know how quality furniture and home decor pieces should be made. Clients can depend on their selection of products for durability, style, and eco-friendly materials. Choose Home Shoppe for your next home decor project and let the sales team take the stress out of the redecorating process by helping you select the best products for your home.

Redecorating For You

Redecorating For You is a trusted Pasadena retail company that provides superior home decor products for shoppers in Pasadena and the surrounding areas. The shop offers an extensive inventory of home decor items in a variety of styles so there is something for every taste. Redecorating For You is able to provide premium pieces that fill every space with elegance and style. The shop also eases the stress of redecorating by providing in-store pickup and delivery options for busy customers.

Competitive Advantage

Artisan Home & Decor will be able to offer the following advantages over their competition:

  • Artisan Home & Decor will bring fresh inventory into the store on a regular basis so there will always be something new for customers to check out. In addition to in-store sales, the company will sell pieces online through its website.
  • Artisan Home & Decor offers one-of-kind pieces created by local artisans to suit a wide variety of home decor styles and tastes.

Marketing Plan

Brand & value proposition.

Artisan Home & Decor will offer the unique value proposition to its clientele:

  • Artisan Home & Decor will make redecorating easy for customers by providing in-store shopping, pickup, delivery, online shopping, ship-from-store, and buy online-pickup in store options.
  • By purchasing from the shop, customers are supporting local artisans and getting fresh decor that no one else will have.

Promotions Strategy

The promotions strategy for Artisan Home & Decor is as follows:

Social Media Marketing

The company will use various social media platforms such as TikTok, Instagram, Facebook, LinkedIn, YouTube, and Snapchat to promote the shop, feature artisans, and show off new pieces. The marketing director will oversee the social media marketing activities to grow the customer base.

Professional Associations and Networking

Artisan Home & Decor will become a member of professional associations such as the National Retail Federation, California Retailers Association, and the Home Furnishings Association. The company will focus its networking efforts on expanding its network of clients, designers, and artisans.

Print Advertising

Artisan Home & Decor will invest in professionally designed print ads to display in programs or flyers at industry networking events, in home decor publications, and direct mailers.

Website/SEO Marketing

Artisan Home & Decor’s marketing director will be responsible for creating and maintaining the company website. The website will be well organized, informative, and list all of the products currently available for purchase online.

The marketing director will also manage Artisan Home & Decor’s website presence with SEO marketing tactics so that any time someone types in the Google or Bing search engine “Pasadena home decor retailer” or “home decor store near me”, Artisan Home & Decor will be listed at the top of the search results.

The pricing of Artisan Home & Decor will be premium and on par with competitors so customers feel they receive value when purchasing the one-of-a-kind products.

Operations Plan

The following will be the operations plan for Artisan Home & Decor.

Operation Functions:

  • Joyce Hernandez will be the Owner and Manager of the store. She will oversee all staff and manage day-to-day operations. Joyce has spent the past year recruiting the following staff:
  • Melissa Jacobs – Inventory Manager who will be responsible for sourcing, purchasing, pricing, and maintaining the inventory.
  • Robert Brown – Staff Accountant/bookkeeper who will provide all store accounting, tax payments, and monthly financial reporting.
  • Bill Johnson – Marketing Director who will provide all marketing and sales activities for Artisan Home & Decor including maintaining the website, social media, print advertising, and promotions.
  • Julia Smith – Lead Sales Associate & Designer who will manage all sales associates and provide design services for customers.

Milestones:

Artisan Home & Decor will have the following milestones complete in the next six months.

9/1/2022 – Finalize contract to lease the retail space.

9/15/2022 – Finalize personnel and staff employment contracts for the management team.

10/1/2022 – Finalize contracts for suppliers.

10/15/2022 – Begin networking at industry events and implement the marketing plan.

10/22/2022 – Begin moving into the Artisan Home & Decor shop.

11/1/2022 – Artisan Home & Decor opens for business.

Artisan Home & Decor will be owned and operated by Joyce Hernandez, a retailer who has worked as a store manager of a local home decor store for nearly a decade. Joyce has recently graduated from California University with a Bachelor’s degree in Business Management. Now that she has gained real-world experience managing a store and the education on how to run a retail business, she is inspired to start her own company, Artisan Home & Decor.

Melissa is a graduate of the University of California with a Bachelor’s degree in Interior Design. She has been working at a local retail home decor company for over a decade as an assistant manager. Melissa has an eye for design and keen organizational skills that will allow her to effectively manage Artisan Home & Decor’s one-of-a-kind inventory. Her communication skills will enable her to establish and maintain working relationships with suppliers.

Financial Plan

Key revenue & costs.

The revenue drivers for Artisan Home & Decor are the retail fees they will charge to the customers in exchange for their products. The shop will charge a healthy margin to make sure artisans are paid well for their products while ensuring a solid profit for the business.

The cost drivers will be the overhead costs required in order to staff a retail store. The expenses will be the payroll cost, rent, utilities, store supplies, and marketing materials.

Funding Requirements and Use of Funds

  • Store shelving, displays, equipment, supplies, and materials: $40,000

Key Assumptions

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.

  • Average number of items sold per month: 300
  • Average sales per month: $90,000
  • Retail space lease per year: $100,000

Financial Projections

Income statement, balance sheet, cash flow statement, retail business plan template faqs, what is a retail business plan.

A retail business plan is a plan to start and/or grow your retail business. Among other things, it outlines your business concept, identifies your target market, presents your marketing plan and details your financial projections.

You can  easily complete your retail business plan using our Retail Business Plan Template here .

What are the Main Types of Retail Businesses?

There are a number of different kinds of retail businesses, some examples include: Specialty Store, Off-Priced/Used Goods Store, Department Store, Convenience Store, Drug Store/Pharmacy, Discount Store, Hypermarket, and E-commerce.

How Do You Get Funding for Your Retail Business Plan?

Retail businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.

A solid retail business plan with comprehensive financial statements will help show investors your are well-prepared to start your own business.  A retail business plan template will help you quickly and easily get started.

What are the Steps To Start a Retail Business?

Starting a retail business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Retail Business Plan - The first step in starting a business is to create a detailed retail store business plan that outlines all aspects of the venture. This should include supporting market research, your potential market size and target customers, the services or products you will offer, marketing strategy, your competitive advantages and detailed financial projections.

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your retail business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your retail business is in compliance with local laws.

3. Register Your Retail Business - Once you have chosen a legal structure, the next step is to register your retail business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options - It’s likely that you’ll need some capital to start your retail business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Retail Equipment & Supplies - In order to start your retail business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your retail business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.

Where Can I Get a Retail Business Plan PDF?

You can download our free retail business plan template PDF here . This is a sample retail business plan template you can use in PDF format.

Other Helpful Business Plan Templates

Ecommerce Business Plan Template Clothing Store Business Plan Template Beauty Supply Store Business Plan Template T-Shirt Business Plan Template

Retail | How To

How to Start a Retail Business in 13 Steps

Published September 15, 2022

Published Sep 15, 2022

Meaghan Brophy

REVIEWED BY: Meaghan Brophy

Brigitte Korte

WRITTEN BY: Brigitte Korte

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This article is part of a larger series on Retail Management .

Starting A Business?

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  • Step 1: Create a Business Plan
  • Step 2: Determine Your Niche

Step 3: Develop Your Brand

  • Step 4: Choose a Legal Structure

Step 5: Organize Your Finances

Step 6: launch your online store.

  • Step 7: Secure Funding
  • Step 8: Choose a Storefront Location
  • Step 9: Design Your Interior
  • Step 10: Choose a Retail POS System
  • Step 11: Hire & Train Retail Staff

Step 12: Build Your Marketing Plan

Step 13: ensure you’re compliant, bottom line.

To open a successful brick-and-mortar store, you need a business plan (including market research) and legal structure for your business, an ideal storefront location, startup funding, inventory, and a team of employees ready to start selling. Plus, in today’s market, you’ll also want to launch an accompanying online store and start marketing your business.

Learn how to start a retail business in 13 simple steps:

Step 1: Create a Retail Store Business Plan

A business plan is a written document containing the goals of a business, the methods for attaining those goals, and the time frame for the achievement of the goals. It is what you present to potential investors and a crucial first step for starting any business. Not only that, writing a business plan gives you a definitive path to follow, ensures you’ve done proper market research, and sets you up for success.

The Small Business Administration (SBA) outlines two types of business plans: traditional and lean startup.

  • Traditional business plans are more thorough and ideal if you’re requesting funding from banks or other traditional loan sources.
  • Lean startup business plans are more informal and designed for businesses that are more fluid and will change a lot as they grow.

You can also create a shorter, one-page business plan. Learn how with our one-page business plan guide .

When opening a retail store, we recommend following a traditional business plan as it’s more detailed—it can never hurt to be too prepared. Plus, it will provide a more concrete outline for you and your business partners or possible investors.

Elements of a Business Plan

The nine elements of a traditional business plan are:

  • Executive summary: High-level paragraph outlining your company’s purpose, mission, and why it will be successful.
  • Company description: Be specific about your company’s details, including what problem you are aiming to solve, how you will solve it, what consumers you plan to serve, and the talent on your team.
  • Market analysis: Include industry outlook and trends, what successful competitors are doing, and what your strengths will be.
  • Organization and management: Outline who will be running your business and the experience your team members have in retail or startup environments.
  • Product line: Outline what kinds of products you will sell, why they are needed, and include any research and development on private labels or proprietary custom products.
  • Marketing and sales: Describe the tactics you will use to obtain and retain customers.
  • Funding requests: If you need outside funding, outline your needs and specify exactly how you will use the funds.
  • Financial projections: Detail how your business will become stable and profitable, including a projected financial timeline of at least five years.
  • Appendix: Use this space for any supplemental documents, such as product prototypes and pictures, credit histories, licenses, and permits.

This may seem like a lot of information, but it’s best to keep each section succinct so readers can easily get through the entire document and absorb all of the information.

Be sure you are answering the “why” behind the “how” of starting a retail business. Why are the strategies you selected for achieving your business plan the best? Why will they work?

Writing Your Business Plan

When it comes to actually writing and formatting your business plan, there are a few different options to choose from. Of course, you can type it out in traditional word processing software like Microsoft Word or Google Docs. You can also build your business plan as a slideshow in PowerPoint, which is a great option if you need to present your plan to an audience.

There are also business plan software tools available, such as LivePlan , that have industry-specific templates. You can also use this business plan template and checklist or enlist the help of business plan writing services .

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Step 2: determine your niche & select products.

A niche is the subset of the market to whom your business and products seek to appeal. This subset can be defined by its own unique needs, preferences, or identity that makes it different from the market at large. Your niche will define the products you sell, your price range, product quality, and marketing initiatives.

The narrower your niche market, the easier it is to become the go-to retail destination for that market. For example, there may be a dozen stores in town that sell pet products, but you may be the only retailer that specializes in dog costumes or organic food options.

Carving out a niche for your retail store helps differentiate your business from the competition. With retail giants like Amazon and Walmart, the competition is fiercer than ever. And truthfully, many large retailers, like department and box stores, carry very similar products. Aside from the feel-good nature of shopping small, having something unique to offer will help you beat out big box retailers.

You can find your niche market by:

  • Listing your hobbies and interests

As a store owner, you will spend a lot of time engulfed in your chosen niche, so your own interests are a good place to start. Plus, choosing something you’re interested in will make your store more authentic.

  • Researching the potential for each niche

Make sure you choose a topic that has good money-making potential by doing research on Google Trends and checking out competitors on social media.

Google trend of dog costumes.

The phrase “dog costumes” appear to be trending downward in search, indicating a different niche may present a more long-term opportunity.

  • Evaluating potential profits

Determine how profitable each niche could be by looking at industry statistics and Amazon Best Seller lists to see what sales are like for your chosen categories. You can also research wholesale prices for products on sites like Alibaba and compare them to typical retail prices to get a sense of potential profit margins.

Amazon Best Sellers lists highlight popular products by category.

Amazon Best Sellers lists highlight popular products by category.

Sourcing Products From Suppliers

Once you’ve narrowed in on your niche products, it’s time to find a reliable supplier for those products. When figuring out how to source products for your retail business, you’ll first need to understand the different options.

  • Manufacturer : You develop the product concept and outsource the creation. This option allows for the most control over the product but also takes comparatively long.
  • Wholesaler : Wholesalers develop products and sell them in bulk to retailers for a discounted price. Retailers then resell those items for a profit. This is the quickest route for product sourcing, but it also allows for the least control over the product.
  • Dropship : Dropshipping is when you sell products directly to customers and then outsource the manufacturing and fulfillment for each order. It is the most hands-off option, but also yields the lowest profit margins.

In the news:

As we know, inflation is a major consideration for both retailers and consumers in the post-pandemic era. However, the National Retail Federation has been putting pressure on the current administration to lower tariffs on everyday items to help lower inflation. In response, President Biden recently signed the Ocean Shipping Reform Act , which aims at improving maritime trade practices and lowering supply chain costs.

When choosing your supplier, research a few different options and order samples from two to five suppliers. Undergo quality assurance testing to narrow down which items you want to source. From there, nurture vendor relationships with effective communication and efficient payment—eventually, you can negotiate discounts, especially for high-volume orders.

The COVID-19 pandemic brought many challenges to supply chains all over the world, and many suppliers are still seeing its effects. As a retailer, you can plan for these issues by padding timelines, vetting suppliers, having multiple sources for your most popular products, and choosing local suppliers when possible.

Retail Market Research

Instead of starting with niche products and then researching to find their market, you can also start by doing primary market research. This is a type of market research where you go straight to your target consumers and ask them questions to figure out their interests. In other words, you are starting with your consumer and their needs rather than starting with a product and then finding the right audience.

When you’re opening a physical brick-and-mortar storefront, you can study your local audience directly to determine their needs. It’s possible, and likely, that there are some specific needs locals have that your store can fill.

Effective primary market research tactics include:

  • Consumer Panels & Focus Groups

Surveys are an easy and effective way to gather a lot of useful data. Established businesses typically use their customer database to send out emails. But, because you don’t yet have a customer database, you can promote your survey through local Facebook groups and targeted Facebook ads.

Your first surveys can be very broad and simply ask local consumers why they like their current favorite stores and interests. As you get closer to choosing specific products, you can send out surveys to measure customer interest and reaction to specific items.

Surveys can provide more accurate data than a focus group or consumer panel, but these types of information-gathering sessions can provide nuanced details and deeper insights that might otherwise be missed in a survey.

Tips for how to conduct focus groups:

  • Keep your group small: Around eight to 10 participants is ideal so everyone’s voice can be heard.
  • Incentivize participants: In your advertisements, make it clear there is a cash or gift card compensation for their time.
  • Choose participants wisely: Have participants RSVP to make sure they live or work near your store’s future location.
  • Have participants fill out a contact form before you begin: Provide consent forms indicating their responses will be recorded.
  • Start with general questions: Get the group started by asking general icebreaker questions. Then move into asking for feedback on products and shopping preferences.
  • Make sure everyone gets equal talking time: Your goal is to get a variety of opinions, so do your best to prevent one or two participants from dominating the conversation.
  • Stay neutral: Remember to stay open to feedback and don’t guide participants or try to persuade them. Focus groups are all about collecting feedback. There’s no need for consensus.

Your products are just one part of your retail business. Developing a brand or your business’ identity is also important because it attracts new customers and builds strong relationships with existing ones. Your brand identity is the essence of who you are as a store—it creates the feel that customers associate with your business and maintains cohesiveness between your products and aesthetic.

You only get seven seconds to make a first impression , but it takes up to seven impressions to create brand awareness. Read about this and more in our article on Branding Statistics Every Small Business Should Know .

When defining your brand, ask yourself what feelings you want your business to evoke. Tap into your market research—look at who your biggest competitors are and think about what their branding looks like and how you can differentiate your store from theirs. All of this information helps build the foundation of your brand.

Elements of your brand include:

  • Visual branding such as logo , storefront, fonts, signage , and colors.
  • Store name and slogan that are completely unique to you. Use this free business name generator to help come up with ideas.
  • Mission statement and vision statement that outline how you want to serve your community and customers.
  • Positioning in your niche, market, community—and what sets you apart from the competition.

Step 4: Choose a Legal Structure for Your Retail Business

Choosing a legal structure for your business is important because it determines how to collect and report taxes, how you’ll get paid from your business, and your level of personal liability. There are many types of legal structures, but the three most commonly found in retail are sole proprietorships, limited liability companies (LLCs), and corporations.

  • Sole Proprietorship
  • Limited Liability Company
  • Corporation or C-corp

If you don’t set up a legal structure for your business, sole proprietorship is the default. It essentially means you’re doing business as an individual and therefore not separated from your business in any way.

Read more about the pros and cons of sole proprietorships .

Limited liability companies or LLCs are legal structures for small businesses that protect your personal assets, such as your house and car, in the case of lawsuits or business bankruptcy. This is the most popular legal structure for small retail businesses, and the one we recommend if you’re planning on maintaining a single storefront.

Read more about the pros and cons of LLCs .

Corporations or C-corps are the most structured legal form for your retail business. They have strict tax guidelines. When you create a corporation, it’s a completely new and separate entity in the eyes of the government and the Internal Revenue Service.

Read more about C-corps .

Regardless of which legal structure you choose, it’s critical to separate your business finances from your personal accounts right from the beginning. Having a dedicated business account will make it much easier to track expenses and income, which will help you stay on track financially. Plus, you’ll have an easier time filing your taxes. Not to mention, if your personal and business finances are combined, that could “pierce the corporate veil” of your LLC if things go wrong.

Choose a Retail Business Bank Account

When it comes to choosing a small business checking account , the options are virtually unlimited. Look for a bank that’s small business-friendly with few fees. Make sure there are branches close to your store or home. As a retailer, you’ll likely be making many cash deposits and making change, so getting to the bank should be convenient.

Consider other features that will make your life easier, such as mobile banking and online check deposit. Also, consider whether or not the bank has features that will help as your business grows, such as business credit accounts, loans, and overall branch location accessibility.

To get help choosing the best small business banking solutions for your business, check out the following guides:

  • Best Banks for Small Businesses
  • Best Bank Accounts for Self-employed Professionals
  • Best Free Business Checking Accounts
  • Best Online Business Banks
  • Best Banks for Startups

Invest in Accounting Software for Retailers

In addition to a small business checking account, you’ll also want to have an accounting software program. There are a lot of expenses associated with running a retail store, such as products and shipping, employee wages, and advertising costs. Accurately tracking your income and expenses will help you see exactly how much revenue you’re making, understand where your expenses are high, determine your product purchasing budget, and make filing taxes a million times easier.

QuickBooks is one of our favorite accounting programs for small businesses because it is affordable, user-friendly, and integrates with many popular retail point-of-sale (POS) systems (we’ll cover POS systems below). It’s particularly good for retailers because it has retail-specific report bundles available—including reports like gross margin by inventory volume—and integrates with ecommerce solutions. QuickBooks plans start at just $10 per month, plus they offer a free 30-day trial.

While you might be opening a physical retail store, in today’s market, you will also want to launch an accompanying digital storefront. Your bottom line has a lot to gain from launching an online store—in tandem with your retail store, it can help you reach a larger audience, geographically speaking, and it also gives you another channel where you can nurture existing customer relationships.

Forecasters from eMarketer expect multichannel sales to make up close to 46% of all ecommerce sales by 2023, up from 40% in 2019. This 46% will amount to more than $585 billion in sales—and those are sales you don’t want to miss.

To start with the launch of your online store, you will first need to choose an ecommerce platform that integrates with your POS system and accounting software. Most modern ecommerce platforms have templates and tools to help you design your store, or you can hire a professional to help.

We recommend Shopify as the top, user-friendly, high-value ecommerce platform. Not only that, every Shopify ecommerce subscription comes with a Shopify POS system for seamless integration.

From there, you will want to get your order fulfillment and shipping figured out so that you can get customers their orders.

You should also consider offering click-and-collect services for your local customers. At the onset of the pandemic, buy online, pick up in-store (BOPIS) increased from 15% of orders to 25% , a 65% share increase, and this BOPIS momentum doesn’t look like it’s slowing down anytime soon.

Not sure where to start with your ecommerce site? We put together an entire guide to take you through how to start an online store . You can also check out these resources:

  • Best Free Ecommerce Website Builders
  • BigCommerce vs Shopify Comparison
  • Shopify Review

Step 7: Secure Funding for Your Retail Store

Opening a retail store requires a lot of upfront investment. You need to sign a lease on a physical space, invest in renovating that space, purchase products, set up your POS system and payment processing hardware, advertise like crazy, invest in a grand opening, and pay staff. It sounds expensive because it is expensive. Altogether, opening a retail store can cost up to $100,000 .

To fund your retail store, ideally, you have a decent chunk of your upfront costs saved that you can invest personally. But, there are also plenty of small business funding options where you can secure capital from external sources.

Some of those options include:

  • Small business loans : You find these loans from banks, credit unions, the SBA, and even your existing network of connections. This is where your formal business plan will come into play—it shows investors your path to success (and to getting a return on their investment).
  • Credit cards: If you’re just starting out and have no business income history, or if you have a lower credit score, choosing a business credit card may be the better option. A credit card will also give you more flexibility to account for unexpected expenses. Visit our guide on the best small business credit cards to see which one may be right for you.
  • Crowdfunding : Crowdfunding is a great way to build buzz for your store and get people financially and personally invested in it. Plus, you don’t need to pay this money back.

The biggest factors to consider when taking out a loan are the interest rates (AIRs), upfront fees, and application requirements. Typical AIRs vary based on your loan type but should look something like this:

An alternative option for funding your business is using your IRA or 401(k) retirement account. Your initial reaction to this idea may be, “Whoa, absolutely not.” But, using your retirement account to fund your business doesn’t necessarily mean you’re cashing out or borrowing against your account.

Instead, there’s an option called Rollover for Business Startups (ROBS) , which lets you invest retirement funds into your new business without paying taxes or early withdrawal penalties. This process can be complicated. So, if you’re interested in using your retirement account to fund your business, we recommend working with an experienced provider like Guidant .

Step 8: Choose a Storefront Location to Open Your Retail Store

Choosing a location for your business can seem overwhelming: Where do you start? How do you know if you’re choosing a profitable area? Will people even want to come to your location?

When choosing a location for your business, narrow down your options first based on practicality and convenience. Consider how far you’re realistically willing to commute every day for the foreseeable future. Choose areas that are easily accessible from your residence. Spend time in each area to become familiar with specific neighborhood demographics and preferences and to scope out other local businesses.

From there, you can start looking at listings in your desired area and finding a space that will work for you and your needs. Contacting listings directly can offer the best deal; however, working with a real estate agent will give you peace of mind in the contract negotiations and help you find the best space for your business.

Learn more in our guide on how to find and lease retail space , which includes different types of leases, terms to be aware of, and how to calculate your monthly rent budget.

Below are some ways that you can get to know a neighborhood and narrow down your perfect location:

Analyze Foot Traffic

For many retailers, foot traffic can account for most, if not all, of sales. This is especially true for convenience stores, for example, where almost all sales are walk-in impulse buys. But, if you’re operating a dog costume specialty shop, you might have more customers drive specifically to your store.

Our guide to determining foot traffic outlines how to calculate whether it’s worth splurging on a prime storefront location. It’s also important to consider the different types of foot traffic and what time of day it occurs. It may not always be what you expect.

For example, there’s a cafe and bakery in my hometown, both located in a central business district. It’s a few minutes out of the way for most commuters, so they do decent business during the morning rush hour. But, the cafe is only a block away from the town’s middle school. Its business is slammed on weekdays around 2 p.m. with all of the teenagers who walk over when school gets out.

This is one example of a foot traffic pattern you wouldn’t be able to predict if you weren’t familiar with the area, which is why it’s important to spend lots of time casing out prospective store locations.

Foot traffic is an important data point to continue using even after your store is up and running. It helps your staff more accurately identify missed sales opportunities. Solutions like Dor will track foot traffic data and integrate with many popular POS solutions.

Talk to Your New Neighbors

In addition to staking out your prospective storefront, inquire about the traffic, shopper demographic, and neighborhood. Ask your listing agent as many questions as you can while viewing the space. But, keep in mind their motive of getting a lease signed. Instead, visit neighboring businesses, introduce yourself, and ask business owners or managers if you can take them out for coffee to get some feedback on the location.

Important questions to ask about the property include:

  • Who is the landlord and how is the property managed? Other businesses and employees in the space you are interested in will give you honest feedback about the landlord’s maintenance style and how they handle things like snow removal and general property upkeep.
  • Why did the previous tenants leave? Look into tenant turnover in the complex, and talk to tenants who left, if possible, to discuss their experience in the space.
  • What’s the busiest time of day and days of the week? Get other tenants’ opinions on traffic to the area.
  • How long do tenants stay in the space? If you’re in an area surrounded by other storefronts, it’s best if they are established stores with regular customers that can help drive traffic to your new shop.

Consider Parking & Signage

In addition to foot traffic and tenant feedback, it’s also important to consider other storefront factors that can majorly impact your retail business. For example, does the space have a dedicated parking lot? If there isn’t a dedicated lot with ample spaces, and street parking is difficult, potential shoppers might not make the effort to visit your store.

Also, consider what signage and street-facing display options are available. To draw in all of that foot traffic you monitored, shoppers need to know your business is there. Ideally, your storefront will be facing a busy street. If the location is set further back, is there a large sign by the driveway where passersby can easily see what businesses are inside? Ask the listing agent and neighboring tenant about what signage options are available and who pays for them.

Additionally, make sure you’re aware of any town or city policies that could affect your storefront marketing. For example, some towns place restrictions on how big the sign on the front of your store can be. Other towns forbid temporary signage like A-frames.

Don’t Ignore Your Budget

As we mentioned earlier, splurging on a prime location can be a savvy move if you’re opening the type of retail store that relies heavily on impulse purchases, such as a corner convenience store or a souvenir shop in a tourist town. But, most boutiques need to stick within their budgets, which means spending less than 10% of your monthly gross sales on rent.

Learn more about how to create a budget and budgeting best practices with our article How To Budget a Retail Business (+ Free Templates) .

Step 9: Design Your Retail Store Interior

After securing a retail storefront, it’s time to start strategically planning the interior. Strategically planning your store layout is so important because it has a dramatic impact on in-store sales. A well-designed layout will welcome shoppers, make them feel comfortable, and direct them toward specific products.

Choose a Layout Structure

The first thing you need to decide is what type of floor plan you want. This will largely depend on the type of store you’re opening. Most retail stores fit into one of these basic layout categories:

Place Your Checkout

A well-positioned checkout will open up prime retail space for displaying products and encourage shoppers to move through more of your store. Instinct might tell you to place your checkout at the front of the store so that it’s most visible or on the right-hand side of your store where traffic tends to flow. But, the best place to position a retail checkout counter is often on the left side of a store.

Shoppers naturally veer toward the right side of a store when they walk inside. So, that’s where you want to display money-making products and new products. Some department stores and larger mall retailers place their checkout counters at the back of the store. However, for smaller retailers, placing your checkout toward the front makes it easier for staff to attend the register and keep an eye on the entrance.

This small-footprint retail store layout features a checkout counter on the left side of the store, with featured products displayed on the right side.

Small-footprint retail store layout features a Checkout counter on the left side of the store, with featured products displayed on the right side

Learn more about how to set up your checkout to drive sales .

Outfit With Fixtures & Displays

Once you have the bones of your store layout and checkout counter placed, you’ll also need to invest in display fixtures, signage, and lighting. Start with parts of the store that will be mostly permanent: counters, lighting installations, dressing rooms, and any fixed shelving.

Because these pieces will be permanent, invest in high-quality items that will form a cohesive look and won’t fall out of trend. From there, you can outfit the rest of your store with more affordable, temporary merchandise displays and decorations that are easier to swap out with the seasons or trends.

Read our guides below for step-by-step instructions on setting different fixtures and displays:

  • How to select and design retail lighting
  • How to design the best storefront sign for your business
  • Tips for great fitting room design
  • Store design ideas for increasing sales

Position Your Products for Success

Exactly how you merchandise your products will depend on what type of store you have and the layout you choose. But there are a few simple tricks you can use to boost sales in any store environment.

  • Eye level is buy level : Products placed at eye level instead of above or below are more likely to be seen and purchased.
  • Place seasonal products and new arrivals front and center : Many retailers utilize a table display five to 15 feet inside the entrance that’s updated almost daily to show off new and limited products.
  • Drive impulse sales at the point of purchase : Think candy at the grocery checkout; placing small, low-cost but useful or appealing items like phone chargers, Chapstick, and lottery tickets near the checkout counter is an effective way to drive add-on sales.
  • Keep it comfortable : Shoppers who spend more time in your store also spend more money; encourage shoppers to stay awhile with Wi-Fi, product demos, and comfortable seating.

For more tips on how to merchandise your store, download our store layout e-book for step-by-step instructions.

Download Free Store Layout Checklist

Step 10: Choose & Install a Retail POS System

Another major piece of opening a retail store is selecting a point-of-sale (POS) system . Most basically, your POS system is the software that processes transactions and completes in-person sales. Modern POS systems, however, do much more than that, acting as the heart of all store management, including CRM, inventory, payment processing, ecommerce, reporting, vendor management, and more. Using a POS system will save you time, streamline all your management tools into one platform, and provide deeper insights into your business.

There are many factors to consider when selecting a POS. Before you start seriously considering different options, it’s important to write down a wish list of what features you want. Some of the criteria we use to evaluate the best retail POS systems include:

  • Price: Most POS software programs charge a monthly fee, and some also charge extra for certain features like advanced inventory management.
  • Setup and installation process: Some POS systems have a DIY installation process; others charge a hefty professional installation fee. You should also note the integration capabilities and process.
  • Ease of use: Test out the POS to make sure the interface is comfortable to navigate; also, read user and expert reviews to be aware of any glitches or common problems.
  • Inventory management: Make sure the retail inventory management solution you use has features to bulk upload orders, set stock alerts, and create purchase orders directly from the system to save you time.
  • Customer management tools: Almost all POS systems have a customer directory feature, but otherwise, they vary greatly in what loyalty, marketing, and customer feedback features are included.
  • Ecommerce functions: If you have plans to also sell online, make sure the POS you choose also has an online store feature so all of your inventory, customer, and order information syncs between online and offline sales.
  • Payment processing: Some POS providers have built-in, in-house payment processors, and others let you integrate with third-party options for no fee.

For traditional brick-and-mortar stores, boutiques, and specialty shops, we often recommend Lightspeed . It’s a small business POS with big business functionality like custom report builders and advanced inventory management tools (such as built-in product ordering) and offers a sophisticated ecommerce platform.

Lightspeed Retail POS Software.

Lightspeed Retail POS (Source: Lightspeed)

Choose a Credit Card & Payment Processor

Once you have a POS system selected, you need to choose a credit card processing company or merchant services provider. Some POS systems include their own in-house payment processing, while others require you to use a third party. The two most important things to consider when choosing a retail credit card processing company are price and compatibility with your POS.

When it comes to price, there are three main types of card processing fee structures:

  • Flat rate: Processing companies charge a set percentage of the transaction; this is usually a good option for retailers such as convenience stores that have lower average sales (under $20).
  • Interchange plus: Processing companies pass along the interchange fees from Visa, Mastercard, and similar payment processors and add a per-transaction fee on top; this is usually a good option for most established specialty shops.
  • Tiered: Processors charge a different rate depending on the type of credit or debit card used in the transaction; we typically don’t recommend choosing a processor with this fee structure because it’s unpredictable and often more expensive.

Credit card processing fees can be notoriously murky and difficult to pin down. Our credit card processing fees guide defines common terms and breaks down different types of fees in detail.

Some card processing companies also charge monthly fees, and some have lengthier application processes than others. Many traditional merchant accounts also require contracts or have early termination fees. Be careful to read the fine print before signing with a card processing company.

The other thing to consider is whether or not the payment processor integrates with your POS system. Choosing a processor that integrates with your POS is ideal because as you ring up sales, they will automatically sync with your POS system’s sales data, inventory, and CRM. If you don’t have a payment processor that integrates with your POS, you have to input sales manually, and your data becomes susceptible to human error.

Read more about choosing the best retail credit card processors .

Step 11: Hire & Train Retail Staff

Last but certainly not least, you need to bring on a stellar group of employees to serve as the front lines of your business. If you haven’t hired an employee before, navigating the process can be really intimidating. Our new hire checklist outlines all of the gritty steps you need to take, such as obtaining an employer identification number (EIN), registering for state and local taxes, and so on.

As a small business retailer, it’s likely you won’t have a dedicated HR team member. And, hiring retail workers right now is especially challenging.

”We hear every day from our member companies—of every size and industry, across nearly every state—they’re facing unprecedented challenges trying to find enough workers to fill open jobs. Right now, the latest data shows that we have over 10 million job openings in the US—but only around 6 million unemployed workers”

– Stephanie Ferguson, Director at the Global Employment Policy & Special Initiatives, US Chamber of Commerce ​​

With this knowledge, it’s more important than ever to take your hiring seriously. Take a look at our tips below and read more with our guide to retail recruiting to learn how you can overcome hiring challenges for your retail business.

Write Attractive Job Posts

The first step in writing an accurate and compelling job post is to create the job description for the position you are hiring, whether store associate or shift manager. Then, consider what qualities would be a best fit for the position. Finally, add in at the beginning of the post what your company is and why your future employees will love working there – including an attractive pay and commission structure .

In addition to using an all-in-one HR management tool, also consider using an applicant tracking system (ATS) to manage your search for the perfect candidates. An ATS is a software program that streamlines the hiring process and tracks candidates from initial job posting to hire. Here are a couple resources to help you find the right ATS tool for your new business:

  • Best Free Applicant Tracking Systems
  • Best Recruiting Software

Start Training Before Your Grand Opening

Practice makes perfect with any skill, and customer service and store operations are no exception. You want your staff ready to deliver A+ service to your guests and shoppers from the minute your store opens, giving you peace of mind that they can handle store operations when you aren’t around. That’s where new hire training comes in.

You can also download our free opening and closing procedures checklists to provide to your staff. We recommend printing these lists and laminating them or keeping them in a clear sheet protector in a binder. Then associates can use expo markers to check things off each day and then erase the list at the end of the week for a fresh start.

Closing procedures checklist.

Hold a paid training “boot camp” where you practice customer service skills, review store policies, outline expectations, and teach staff about the products in your store. Find ways to incorporate games and contests to keep the training engaging.

“Most of training is exposure; you tell them what to do, and they understand. But, until you commit to having a great sales process, in bite-sized lessons that you practice and role play, you won’t be able to hold employees accountable. Without accountability to execute that process every time, you’ll settle for whoever will work your shifts, you’ll cripple your ability to succeed, and invariably you’ll use the loser’s limp that Amazon was the reason you weren’t successful. Training isn’t something you did once—it’s something you do.”

– Bob Phibbs, CEO, The Retail Doctor retail consultancy

Now that your brand and store are ready, it’s time to build a retail marketing strategy . Your marketing strategy should outline everything from your pre-launch initiatives to your store’s grand opening and the first few weekends post-launch. This will ensure that people know about your store upon opening and that you are able to continue to attract a healthy mix of new and repeat customers.

Plan Your Grand Opening

You’ve put in months, if not years, of hard work conceptualizing your store and building it from the ground up—a grand opening is a perfect opportunity to introduce your business to the community with a bang.

Some ideas you can consider to boost your grand opening are:

  • Hand out unique promotional gifts
  • Provide product or service discounts
  • Host games and live music
  • Invite the local news and influencers
  • Partner with a local group or charity

Market in Advance

Planning a party only to have no one show up is really disheartening and definitely not the tone you want to set for your new business. Make sure your event is well attended by recruiting friends and family, but also by starting your advertising efforts as soon as you have a date planned. Draft a press release to send to local media outlets and neighboring businesses. Create an event on Facebook. Take an ad out in the local paper. Go all out.

Need some inspiration for advertising your grand opening?

Learn how to write a grand opening press release .

Partner With Other Businesses

Working with similar but non-competitive businesses, such as spas, fitness centers, and other types of retailers, is a great way to tap into a pre-existing customer base. By involving other businesses, you’ll spread the word about your store to their customers, too. Tap into your local chamber of commerce, networking groups, schools, and even youth sports organizations. Invite members from those groups to attend your grand opening festivities.

Our final and possibly most important tip for starting a retail business is to ensure you’re fully compliant and legal. Be sure to comply with all local laws and regulations when opening a retail store, including but not limited to:

  • Federal tax ID or EIN : Used to identify businesses for tax-paying purposes; this is a nine-digit number issued by the IRS that all employers need to apply for.
  • Sales permit: Issued by the state and allows businesses to sell products and collect sales tax.
  • Certificate of occupancy: Local government issues a certificate stating the building your business is inhabiting is up to code.
  • Sign permits: Some local governments require permits for certain kinds of signage, like the one you may want to display on your storefront.
  • Safety and health information bulletins: You may be required to display certain signage about employee rights or safety information; these are often provided to you, but it never hurts to check with your local government.
  • Local COVID-19 mandates: Although these mandates are no longer as prevalent, you might be required to have a fully vaccinated team and put regular testing in place for those who are unvaccinated or enforce some type of mask-wearing rule.

If you’re unsure where to start or want to be sure you’re not missing any compliance aspects, check with your local town hall or municipal center and your local chamber of commerce.

Opening a retail store takes years of planning. But, putting in the time to make a detailed plan and execute accordingly will set you on a path to success once your business is operational.

You May Also Like…

  • Our ultimate guide to managing a successful retail store
  • Learn what retail metrics you should measure and how to interpret them to keep your store on track
  • Ready to grow? Here’s how to know when it’s time to open a second retail store
  • Launch an effective retail commission structure for your store and staff

About the Author

Brigitte Korte

Find Brigitte On LinkedIn

Brigitte Korte

Brigitte is a retail specialist and staff writer with brick-and-mortar management experience. Before joining FSB, she managed a storefront for several years, working in everything from merchandising, to buying, to sales analysis. Brigitte also has a background in writing, research, and publishing, with an undergraduate degree in writing.

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Everything You Need to Know to Start a Retail Business

Learn about what it takes to build and grow a retail business from the ground up.

FREE BUSINESS PLAN TEMPLATE

The Essential Guide and Checklist For Starting Your Business

retail-businesses

Updated: 02/19/19

Published: 02/18/19

I worked in three different retail stores while growing up. The most memorable experience I had was working at a clothing store on Cape Cod when I was 18. The store had been recently renovated and looked beautiful — the desk with the cash register was designed to look like it was built from parts of a large fishing boat and the nautical theme continued to the inventory, floors, and gift boxes.

The store manager was also incredible — she was meticulous, caring, a natural problem solver, highly organized, and knew our products inside and out. She trained all employees to ensure we were prepared to assist any customer who entered the store in a way that was helpful and on-brand. My experience working at this store was a prime example of everything a retail business should be.

→ Download Now: Free Business Plan Template

From your store’s appearance to inventory to the manager you hire, there are a multitude of factors that impact the creation of a prosperous retail business Follow along and we’ll cover the steps you should take to start your retail business, the resources and tools you’ll need to manage your store, and how to find the right employees to work in your store. 

But first, a critical question.

What Is a Retail Business?

How to Start a Retail Business

Retail Marketing Strategy

Resources and Software

Retail Employee Candidates

Retail businesses sell items or services to customers for their consumption, use, or pleasure. They typically sell items and services in-store but some items may be sold online or over the phone and then shipped to the customer. Examples of retail businesses include clothing, drug, grocery, and convenience stores.

Now that you understand what type of store falls under the definition of a retail business, you might be wondering how to actually go about starting one. Let’s review 11 steps that are critical when beginning your retail business.

How To Start a Retail Business In 11 Steps

  • Create a Business Plan
  • Choose Your Legal Structure
  • Name Your Business
  • File for an Employer Identification Number
  • Understand Other Retail Business Laws
  • Pick a Location and Make Your Store Attractive
  • Find Your Inventory
  • Create Store Policies and Procedures
  • Develop a Customer Service Plan
  • Recruit a Team of Employees
  • Host a Grand Opening

Each of these 11 steps should be thoughtfully considered and completed when building your retail business as some are actually federal and state legal obligations. Also, these steps aren’t listed in any specific order so feel free to jump around and work through them in any way that makes sense to you.

1. Create a Business Plan

One of the first things anyone looking to start a business should do is create a business pla n . This is the document that details all aspects of your company including what you’ll sell, how your business will be structured, who your target audience is, and your financial information. 

Creating a business plan is crucial because it provides you (and your partners) with a comprehensive overview of your business at once making it easy for you to determine what will or will not work and what needs to be modified. Your business plan should be concise, yet informative and detailed. It’s also important to remember this is a living document , meaning you can always make changes as you start to implement different aspects of your plan.

Discover how to create a business plan to help you kickstart your company .

2. Choose Your Legal Structure

Disclaimer : This post is not legal advice for your company to use when choosing your legal structure or building your retail business. Instead, it provides background information to help you better understand these processes. This legal information is not the same as legal advice, where an attorney applies the law to your specific circumstances, so we insist that you consult an attorney if you’d like advice on your interpretation of this information or its accuracy. In a nutshell, you may not rely on any of this piece as legal advice, or as a recommendation of any particular legal understanding.  

When starting a retail business, you’ll have to choose a legal structure . Legal structures are recognized by the Internal Revenue Service (IRS) and determine which income tax forms you have to complete and submit for your business. Here are five common business legal structures for your consideration:

  • Sole Proprietorship
  • Corporation (C Corp)
  • S Corporation (S Corp)
  • Partnership (LP and LLP)
  • Limited Liability Corporation (LLC)

Learn how to choose the right legal structure for your new business .

3. Name Your Business

Your business’ name should be catchy, easy to say and repeat, unique, and convey meaning. This way you know it’ll resonate with your customers and be memorable.

You should also search the web to ensure it hasn’t been used. To double check your name hasn’t already been taken, you can search for a trademark through the United States Patent and Trademark Office (USPTO) database. If you are beginning a C Corp or an LLC, you’ll need to visit your Secretary of State’s website to ensure your business entity’s name hasn’t already been used. (Here’s what the Massachusetts Secretary of State website looks like for reference.)

4. File for an Employer Identification Number

You’re most likely going to need to file for something called an Employer Identification Number (EIN), also known as a Federal Tax Identification Number, when you start your business. This is an identifier almost every business in the US and US territories — provided by the IRS — must obtain. Your EIN is what your business will use to report income tax activity.

You can check with your state to make sure you need an EIN as well as review the IRS EIN checklist to make sure you qualify. Once you’ve done that, you’re ready to apply for your employer identification number .

5. Understand Other Retail Business Laws

One final legal step for you to complete to set up your business — understand all other retail business laws at both the state and federal levels. We’ve covered a lot of the tax information you’ll need to be aware of, how to legally name and trademark your business, and how to file for an EIN. But you’ll also want to make sure you have all other legal matters taken care of before opening up your retail business. 

Every state’s government website should have a section that reads something like “starting a business”, similar to this one from the Massachusetts government site . Here, you’ll be able to work through a checklist of items to make sure everything you’re doing is legal. You’ll also be able to acquire any other necessary retail business papers and permits . In terms of government laws related to your business you should have a general understanding of tax, employment, and labor, antitrust, advertising, environmental, and licensing laws among other retail laws . 

Our recommendation to you is hire a lawyer or consultant to help you throughout this process — or at least get you started. The last thing you want to do is go through the effort or starting your retail business and then find yourself in legal trouble. A lawyer or consultant can ensure you consider and understand all retail business laws and requirements. 

Now, it’s time to get out of the legal mindset and move onto some more creative aspects of your retail business.

6. Pick a Location and Make Your Store Attractive

Your store’s location and appearance matter. This is how you’re going to make sure you have the foot traffic and visibility you need to kickstart and maintain a high volume of customers. It’s also how you’ll attract customers and make them want to enter your store.

Retail Store Location

If you decide to go with commercial space for your retail business — which is a building intended for stores or companies to conduct business and make a profit — make sure your location is a good one by chatting with other businesses next door and nearby. You can even conduct an informal foot traffic study by hanging out in the area to observe the number of people who shop there as well as the type of clientele to determine whether or not it resembles that of your buyer personas .

When looking at commercial spaces, you should also think about whether or not you want to rent/ lease the space and work with a landlord or buy the space so you have full control. 

Learn how to create buyer personas for your business to enhance your marketing strategy .  

You might decide to conduct your retail business out your of your home rather than a commercial space. While this will save you a lot of money because you won’t be putting any towards a separate building or retail space, it might feel slightly less professional to your customers. It may also be harder to bring in foot traffic depending on the location of your home. 

No matter what type of retail location you choose, be sure to look into your city’s zoning and planning details. These are typically provided by every town’s zoning commission and tell you whether or not changes to the area, such as construction or traffic, will create any problems or limitations for your store.

Retail Store Appearance

From the way your inventory is presented to your choice in cashier counter to your window displays , everything your customers see and experience should feel and look professional, clean, and beautiful. This way customers want to enter your store and feel excited to do business with you. 

You can make your store look great and feel inviting by using visual merchandising techniques to help you design it in a way that’s well-organized, well-lit, and on-brand. You can also hire a consultant to come in and help you lay out your store in a way that’s visually appealing.

Additionally, you can incorporate modern technology into your store to enhance the customer experience. For instance, you can  create a QR code  that customers can scan to access exclusive promotions or information about your products, adding an interactive element to their visit.

7. Find Your Inventory

Finding the right inventory to sell is crucial. You need to give your customers a reason to come to your store by providing them with unique items they’d have a hard time finding anywhere else — especially since online shopping is so common today due to its convenience. To help get you started, you can search for one of a kind items and unique pieces at fairs, trade shows, and festivals . 

Here are a couple more things to think about when trying to determine how you’ll source your business’ inventory :

Current Trends

Keep up with current trends within your retail niche (clothing, jewelry, accessories, etc.) to determine the type of inventory you should sell. With the help of social media, retail blogs , and magazines, and by simply learning about what’s doing well in other retail stores similar to yours, you’ll be able to determine the ideal inventory for your brand and buyer personas. These resources will ensure there’s a base of customers looking for the type of inventory you’re going to be selling.

Consider the type of supplier you want to get your inventory from — this might be through a manufacturer, individual maker, or wholesale.

  • Manufacturer
  • Individual Maker

Working with a manufacturer gives you a lot of flexibility because they help you create products that don’t already exist. Although you can determine the design, quality, and look of the product you crate, this also means working with a manufacturer can become expensive and time-consuming. 

Individual makers are people who create unique pieces of inventory themselves. An example of this would be someone in town who makes knit scarves and hats and sells them to you to then sell in your store. This is a great way to ensure your store has one of a kind pieces. It also means you’ll have to take the time to find talented makers who create quality items that are on-brand and would appeal to your buyer personas. 

Using wholesalers is a great option if you want to sell products in your store that are already being sold by other stores and online retailers. You’ll receive wholesale items directly from the company that makes them for a lower price but you’ll have less say when it comes to your selling margins, as the wholesaler will have control over them. It can be hard to find trustworthy wholesalers at first, so you might try wholesale-specific marketplaces like Faire to discover brands and then order from them regularly.

8. Create Store Policies and Procedures

Creating store policies and procedures for your customers and employees is critical if you want to maintain a sense of order within your retail business. Policies and procedures between your business and customers may include things like your return and exchange policies or whether not you want to allow pets in your store. Policies and procedures between your business and employees may include things like dress code and scheduling expectations.

By creating these store policies and procedures you avoid making customers and employees feel confused about the way something works within your business or at your store. This also helps you set standards for the way you want people to interact with your business on a regular basis.

9. Develop a Customer Service Plan

When starting your retail business, you’ll want to think about how you’re going to develop a customer service plan. Customer service is how you help your customers solve problems, teach them how to use your products, and answer their questions. Your customer service plan details the ways you’re going to do this. Customer service work is proactive . Meaning the point of developing a customer service plan and related policies is to solve for your customer’s problem prior to them even realizing they have an issue.

Let’s cover a few ways you can implement a customer service plan for your retail business through customer-friendly policies, employee training, and customer-loyalty programs.

Customer-Friendly Policies

By creating customer-friendly policies, you’ll make shopping at your retail store simple and stress-free for your customers. For example, you can can create return policies that allow your customers to bring an item back for a full refund with or without a receipt.

Other policies that prevent pain points and enhance customer service include a 100% satisfaction guarantee or complimentary hemming when you buy a piece of clothing in store.

Employee Training

You should train your employees about how to handle different situations with your customers such as exchanges, complaints, and refunds. Training will provide your employees with the exact steps they should take to ensure a professional interaction with your customers that resolves the issue at hand.

Your customer service training should also cover how you expect your employees to deal with larger customer issues and disputes. Provide them with a way to escalate an issue to you — or your store manager — when they’re unable to reach a resolution that satisfies your customer on their own.

Customer Loyalty Program

By proactively providing an incentive for people to return to your store with a customer loyalty program , you’ll likely increase your sales and number of promoters (the people who tell their network about your business). You also enhance their experience doing business with your business as well because you’ll be providing them with discount codes, details about sales, information about your latest products, and any other exciting event or piece of news you have to share.

10. Recruit a Team of Employees

It’d be difficult to grow your retail business without bringing on some team members. You may start as your sole employee, but as your business flourishes you’ll likely need some assistance. You can determine the most important qualities you’re going to look for in candidates, whether they’re related to personality, prior retail experience, or culture-fit. Then you can select and tailor specific retail interview questions to help you narrow down your pool of candidates. (We’ll cover more details about which skills you should look for in your candidates shortly.)

11. Host a Grand Opening

You might choose to have a grand opening for your retail store. This marks the date in which you are officially open for business. Grand openings may include celebratory beverages, food, and sale items to excite your new customers.

Prior to your grand opening, you might also have a soft launch, or soft opening, for your business. Soft launches are when you, the business owner, invite a group of guests to your store to essentially test everything out. These events are a great way to make sure everything works perfectly before your grand opening — meaning this is your last chance to ensure your customers love your inventory, your store is appealing to your guests, and your everything in your store, such as your POS system, functions perfectly. 

You’ve officially worked through all 11 steps required to build your own retail business — congrats! Now, you’ll need to create your retail marketing strategy.

How to Create a Retail Marketing Strategy

  • Define your positioning
  • Define your audience
  • Create your mission statement
  • Decide on your branding
  • Think about your content marketing strategy
  • Decide on your budget

Every retail business should have a retail marketing strategy — this will serve as the marketing plan you’ll use to promote your business. It’ll be the way you get the word out about your business and help you build your base of customers and promoters. Here are six steps to work through when creating your retail marketing strategy .

1. Define your positioning.

Defining your positioning is a critical part of your marketing strategy. That’s because your positioning is what makes your retail business stand out and differ from your competitors. Think about what it is that makes your business unique and use those details to define your positioning. This might be where or how you source your inventory, how you display all of the items in your store, or your impeccable end to end customer service experience.

2. Define your audience.

Once you define your positioning, you should be able to get a better idea of the audience you’re going after. Think about what type of consumer would appreciate your positioning, the products you sell, and how you sell them. By clearly defining your audience, you’ll be able to create buyer personas to help you develop a steady customer base and understand their wants and needs. 

Learn how to create buyer personas for your business with easy to use templates .

3. Create your mission statement.

Your mission statement is another critical part of both your retail marketing strategy and your business as a whole. It’s a formally written statement explaining your business’ goals and values — it essentially explains the reason why your business exists, the purpose it serves its audience, and how it differs from competitors. Your mission statement is what you and your employees can turn to when you need guidance or inspiration, and it’s what your customers can turn to when they want to learn about who you really are as a business and brand. And if you need some help envisioning what yours should say, you can always review mission statement examples from other companies. 

Naturally, as your company evolves and grows, the details of your mission statement may also shift. That’s alright because your mission statement is a living document, meaning it can (and should) be updated over time as you see fit.

4. Decide on your branding.

Your retail business’ branding should feel like a combination of your audience and mission statement. Meaning you should think about what type of branding your chosen audience will respond well to and how it’ll help you represent and depict your company’s goals and values. 

You should study the branding of your competitors to ensure yours stands out and looks unique to your customers. Lastly, make sure your branding is memorable — you want someone to look at any piece of your marketing and know it’s yours.

5. Think about your content marketing strategy.

A great retail marketing strategy includes a content marketing plan . This consists of media you create for your retail business such as written and visual content. A comprehensive content marketing strategy will help you establish a strong online presence and promote your business . 

For example, a common way to establish an online presence through content marketing is via social media. Social media marketing allows you to promote your business through various platforms such as Instagram and Facebook . Once you determine the different aspects of your content marketing strategy, you’ll want to ensure you plan and schedule all of that great content you’ve just created.

Content marketing schedule

Once you have developed your content marketing strategy, you’ll need to make sure the actual content you’ve created is posted, distributed, and shared when you want it to be. Create a content marketing schedule that you and your team can work from to ensure all content is shared as planned.

There are a number of different content marketing scheduling software options, such as CoSchedule , to help you do this. Depending on your business’ needs, you may also choose to use a much broader marketing automation software such as HubSpot , or a more specific social media automation software such as Hootsuite . These software options speed up the scheduling process, ensure your content is shared on time and as planned, and allow you to dedicate employees to certain content.

6. Decide on your budget.

You’ll need to set a marketing strategy budget to work within when developing all of these different pieces to your plan. Think about how much money you want to put towards each of these steps so everyone on your team is aware of the parameters they’ll need to work within. 

When determining your budget, you might find that you’re a bit limited to the amount you can put towards each of these retail marketing strategy steps simply because you’re a new business with fewer resources. That’s alright and totally expected — just remember to expand your budget when necessary as your business grows. 

To help get you started, you can consider the following recommendation regarding marketing strategy budgets by the US Small Business Administration : If you’re doing less than $5 million a year in sales and your net profit range is 10-12%, spend 7-8% of your gross revenue for marketing and advertising. 

Now that you’ve worked through the steps to building your retail business from the ground up and have a better understanding about how you can approach the creation of your retail marketing plan, let’s discuss some of the resources and software you’ll need to run your retail business.

Resources and Software Every Retail Business Needs

The following six resources and software are tools often used by retail businesses. As you start planning your business, you may think of more tools you’ll need depending on the retail business you’re opening. The following list will get you started most likely need to be modified for your store needs.

1. POS System

One of the most important tools you’ll need to run your retail business is a point of sales system or POS. 

A point of sales system is a software that allows you to conduct customer checkouts and accept multiple forms of payment such as cash, credit cards, and mobile payments. The software also prints receipts, scans inventory barcodes, and stores cash. There are a number of retail-focused point of sales systems to choose from to help you manage all of your customer transactions which we’ll discuss shortly. Without a POS system, it would be exceptionally time-consuming and difficult to keep track of all of your sales and payments.

Here are some POS systems for retail businesses to help kickstart your search for the perfect one for your business: 

  • Square Point of Sale

You may also want an inventory management software for your retail business. This will keep track of all information about your inventory to understand which items you need to replenish and how often you need to do so. These days, many POS systems, including the five we just listed, have inventory management systems built into them so you may not need to worry about finding another software.

2. Stock Keeping Units

Typically, retail businesses will have some type of stock keeping unit, or SKU, system to keep track of every single piece of inventory they have. A SKU — which is typically located alongside an item’s barcode — is a combination of numbers and letters used to identify and organize each piece of your inventory by characteristics such as size, color, and brand. 

what-is-a-sku

Instead of having to come up with your own SKU, POS systems with included inventory management capabilities also have SKU creation features.

4. Retail Blogs

Every business owner needs inspiration every now and then. Retail blogs are a great way for you to keep up with the latest retail trends and learn about what is and isn’t working well for other similar businesses. Retail blogs, such as The Retail Doctor and Medallion Retail , are focused on topics including growth, industry trends, new software, and in-store business vs. online business.

6. Employee Scheduling Software

As your retail business grows, you’ll most likely find yourself adding members to your team. Managing any number employees — and their schedules — is simple with an employee scheduling software , such as Ximble or TSheets , which allows you to organize and update your business schedule so your employees know exactly when to show up for work. 

Now that you have a better understanding about the resources and tools you’ll need to start your retail business, let’s talk about how you’re going to find the right employees to work in your store.

What to Look For In a Retail Employee Candidate

Who are the people that are going to help you grow your business? What traits should your employees possess to ensure they’ll be impactful additions to your store? Let’s cover some of these important characteristics to help you identify candidates who will be quality employees.

Communication Skills

Retail employees need to be great communicators — they’re interacting with your customers every day. They must be able to communicate details about your inventory to help them find the items they’re looking for. If someone calls your business with a question or issue, they’ll need to communicate their answer or provide a solution. Lastly, your employees need to be able to communicate with you about things such as their schedule and how their experiences with your customers are going.

Positive Personality

Whether your employees are chatting with your customers in person or online, about a topic that’s good or bad, your employees need to maintain a positive attitude. They act as the face of your brand and you want them to represent your business well. So, hiring people with a positive, can-do attitude that’s ready to tackle any situation that may arise — even if it’s a complex and involves an unhappy customer — is important.

You’re bound to have an unsatisfied customer at one point in time. Your employees must be patient as they listen to the issue in which the customer describes. They also need to be patient while working with that customer to find a solution. Otherwise, it’d be difficult for your employees to turn your customer’s negative experience around.

Empathy is feeling and understanding another’s emotions. Whether a customer is in a rush, has to purchase a sympathy gift, or is unhappy with an item of yours, your employees must be empathetic. This is how they’ll find a solution that fits the needs of the given customer. Empathy is what will help turn a customer’s negative experience into a positive one so they’ll continue doing business with you in the future.

Dependability

Whether you have one employee or 10, they need to be dependable. You depend on your employees to represent your business, work hard to delight your customers, be professional and kind, and simply show up to work (on time, of course) when scheduled.

Prior Retail Experience

Requiring your employees to have prior retail experience is up to your discretion. You may choose to focus on personality traits and culture fit instead of work history. However, if you do want employees with prior experience, you could look for candidates who have worked in other stores before or even have an education in fashion, design, or communications.

Start Selling

Starting a retail business is hard work. But, by following the steps we discussed, you can make it happen. Remember there are a lot of moving parts that come with starting a retail business that may change, such as your business plan and mission statement, as you begin putting your ideas into action. Start by obtaining the right resources and tools and hiring the right people to help you start growing your retail business.

Business Plan Template

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How to create a retail store business plan

By Andrea Nazarian

retail design business plan

A successful retail business starts with a well-thought-out retail business plan. While you may think you have your business ideas all figured out in your head, putting them down on paper in the form of a business plan is crucial for several reasons. 

In this post, we’ll explore what a retail business plan is, why it’s different from other business plans, what to include in it, common mistakes to avoid, and how to make your plan stand out.

What Is a Retail store business plan and why do you need one?

A retail store business plan is a comprehensive document that outlines your business model, identifies your target customers, and lays out a roadmap for turning your retail store or online shop into a profitable business. 

It’s a planning and forecasting tool that provides clarity and direction for your business. With a good business plan, you’re more likely to achieve success. 

Here’s why having a retail store business plan is essential:

Planning and forecasting

A retail store business plan helps you plan and set clear goals for your business’s short-term and long-term success.

Planning helps you set goals, allocate resources wisely, and stay on track. It ensures that day-to-day operations run smoothly. Forecasting, on the other hand, helps businesses anticipate future trends and challenges, allowing them to make informed decisions and adapt to changing circumstances. 

Together, planning and forecasting help you avoid costly mistakes, reduce labor costs , seize opportunities, and achieve both short-term and long-term objectives. In essence, they’re like a GPS for your retail business, guiding it towards profitability and sustainability.

Securing investment

A retail store business plan helps secure investment by demonstrating a clear and well-thought-out strategy. It shows potential investors that you’ve done your homework, understand your market, and have a solid plan for success. 

The plan outlines your business goals, target market, competitive analysis, and financial projections, instilling confidence in investors that their money will be used wisely. It also highlights your commitment and professionalism, making you a more attractive investment opportunity. 

Essentially, a strong retail business plan reassures investors that your venture is a sound investment with a higher likelihood of delivering returns on their capital.

Guiding business operations

A retail store business plan serves as a roadmap for guiding business operations. It outlines your business’s goals, strategies, and tactics, providing a clear direction for daily activities. 

It helps you make informed decisions about product offerings, retail staff scheduling , pricing, local business marketing , online marketing and staffing. The plan also includes financial projections and budgeting, ensuring you manage resources effectively. 

Regularly reviewing the plan allows you to track progress, identify areas needing improvement, and adjust strategies accordingly. Overall, it keeps the business focused, organized, and aligned with its objectives, making day-to-day operations more efficient and effective in achieving long-term success.

Get your team in sync with our easy-to-use, all-in-one employee app.

How is a retail business plan different from other business plans?

Retail businesses are unique in many ways, and your business plan should reflect that. Unlike other businesses, retail operations involve factors such as inventory management , supply chains, order fulfillment, deliveries, and customer returns. 

Here’s how a retail store business plan differs:

Inventory management

Unlike other business plans, retail plans must handle challenges like seasonal sales variations and predicting what customers will buy. Inventory management in retail business plans is about keeping the right amount of products in stock to meet customer demand while avoiding excess or shortages. 

They also need to explain how they get products, where they store them, and how they restock when items run low. In contrast, many other businesses don’t deal with these inventory issues.

Retail store business plans focus more on handling and controlling inventory to make sure they always have what customers want and don’t waste money on too much stock.

Marketing strategy

Marketing strategy in retail store business plans, compared to other business plans, often emphasizes attracting customers to physical or online stores, creating appealing displays, and running promotions like sales or loyalty programs. 

Retail plans typically prioritize reaching a broad consumer base and enticing them with visually appealing products. In contrast, other business plans might focus on more specialized marketing, like B2B partnerships or online advertising. 

Retailers also consider factors like store location and layout, which are less significant for many other businesses. So, simply put, retail business plans concentrate on tactics to draw in shoppers and make their shopping experience enjoyable and memorable.

Growth strategy

Growth strategy in retail store business plans, unlike other business plans, often centers on expanding to new locations, introducing new product lines, or attracting more customers. Retailers aim to increase sales by opening additional stores, going online, or diversifying their offerings. 

In contrast, some businesses may focus on improving internal processes or targeting specific niche markets. 

Retailers typically rely on broadening their reach to fuel growth, making strategies like franchising, adding new store branches, or exploring e-commerce crucial components of their plans. So, in simpler terms, retail business plans tend to emphasize expanding the business footprint and customer base as a primary path to success.

What to do before you start writing your retail store business plan

Research your market.

T horough market research is essential. Investors look for evidence of a healthy market and an unmet need that your business can address.

You’ll want to gather data on who your customers are, what they want, and where they’re located. Analyze your competition to see what makes your business unique. This research helps investors see that there’s a demand for your products or services and that your business can thrive in the market. 

It’s about proving that your idea is well-informed and has the potential to succeed. So, in simple terms, thorough market research shows investors that your business plan is based on a strong foundation of knowledge and understanding.

Understand your competitors

 Know your competition inside out. Understanding what sets you apart is crucial.

You need to know who you’re up against and what makes them tick. Research your competitors thoroughly: their strengths, weaknesses, and strategies. Identify what sets your business apart – your unique selling points. 

Investors want to see that you’ve done your homework and can explain how your retail store will outshine the competition. Maybe it’s better prices, superior quality, or outstanding customer service. 

This knowledge not only helps you stand out but also shows investors that you’re ready to face the competition head-on, which can boost their confidence in your business’s potential success.

Have a growth strategy

Define a clear growth strategy to demonstrate how your business will expand once it’s up and running. It shows investors that you’re not just focused on starting your business but also on making it grow in the long run. 

You can outline different growth strategies like market penetration (selling more to existing customers), product development (creating new products for existing customers), market development (selling existing products to new markets), or diversification (introducing new products to new markets). 

This helps investors understand your vision and how you plan to increase your business’s value over time, making your retail venture a more attractive investment opportunity.

What to Include in your retail store business plan

Business overview.

Provide a high-level description of your retail business, including your company’s structure, location, and the products or services you’ll offer.

Business goals

Explain your business goals, whether they’re related to market share, product ranges, or online expansion.

It should give a clear, simple picture of your retail business. Explain whether your business will operate in a physical store, online, or both. 

Mention the legal name of your company, where it’s located, and briefly describe the products or services you plan to sell. Keep it straightforward and easy to understand, so anyone reading your plan can quickly grasp what your retail business is all about. 

This section sets the stage for the rest of your plan, helping readers get a sense of your business from the get-go.

Your industry experience

In the “Your industry experience” section of your retail store business plan, it’s your time to shine. Tell the readers about your background and expertise, especially if you’ve held important positions in recognized retail businesses. 

If you’ve previously led successful growth initiatives or managed to open new stores that flourished, this is the place to mention it. Basically, this section is all about showcasing your qualifications and experience in the retail world.

It helps build trust and confidence that you’re the right person to turn your retail business idea into a thriving reality. Keep it concise but impressive.

The “ Marketing strategy ” section of your retail store business plan is where you paint a picture of how you’ll present your store to the world. Explain your store’s image, the strategy for your brand, and how you plan to market your products or services. 

Don’t forget to dive into the 4Ps of retail marketing:

  • Product : Describe what you’re selling and what makes it special.
  • Pricing : Explain how you’ll price your products and why.
  • Place : Tell where you’ll sell your products, be it online, in-store, or both.
  • Promotion : Detail your strategies for promoting your store and products.

This section gives a clear roadmap for how you’ll attract customers and make your business a success. Keep it straightforward and compelling.

Financial strategy and forecast

The “Financial strategy and forecast” section of your retail store business plan is where you show the money side of your business. Investors want to see the numbers, so include things like:

  • Estimated capital requirements : How much money do you need to get started and keep going?
  • Profit and revenue models : Explain how you plan to make money and what your sales goals are.
  • Sales volume projections : Predict how many products you expect to sell.
  • Financial statements : Include balance sheets, cash flow projections, and any other financial documents.

These details help investors understand your business’s financial health and potential. Make sure your numbers are realistic and based on careful research and planning.

Management structure

In the “Management structure” section of your retail store business plan, you’ll provide details on how you intend to organize your team and manage your business effectively. This section involves explaining several key aspects:

Firstly, you’ll specify the number of team members you plan to hire. This is essential to understand the size and scope of your workforce.

Secondly, you’ll describe the roles and responsibilities of each team member. This clarification ensures that everyone knows their specific duties and contributes to the smooth operation of the business.

Lastly, you’ll illustrate how each team member fits into your overall business plan. This section helps investors and stakeholders comprehend how your team will collaborate and work together to achieve the business’s goals and objectives. 

A well-defined retail management structure assures potential investors that you have a competent team ready to execute your business plan effectively.

Homebase offers user-friendly employee management tools to streamline team communication , time tracking, and scheduling , helping you refine your management structure. 

Common mistakes to avoid when making your retail store business plan 

A successful business plan is as much about what you leave out as what you put in. Here are some common mistakes to avoid:

Too much detail

Avoid long, rambling text. Use visuals and graphics when possible and attach heavy content as appendices.

Poor financial planning

Account for growing expenses, taxes, and market influences in your financial projections.

Poor spelling and grammar

Basic errors can undermine how partners and investors view your plan.

Strengthening your business plan

To strengthen your business plan, consider your audience, which may include potential investors, business partners, and financial institutions. Be transparent, avoid exaggerations, and demonstrate the value of your idea.

Conclusion: Finishing your retail store business plan

A well-crafted retail store business plan is more than just a guide; it’s a tool to attract investors, secure funding, and set the foundation for a successful retail business. Leveraging tools like Homebase can help you stay competitive and efficient in the retail industry.

Don’t delay writing your plan—it could be the first step towards realizing your retail business dreams.

FAQs about writing a retail store business plan

What is a retail store business plan, and why is it important.

A retail store business plan is a comprehensive document outlining your retail store business’s model, goals, and strategies. It’s crucial as it provides clarity, attracts investors, and guides daily operations for success.

How does a retail store business plan differ from other business plans?

Retail store business plans are unique due to their focus on inventory management, marketing tactics to attract shoppers, and growth strategies centered on expanding customer reach.

What should I include in my retail store business plan’s business overview section?

In the business overview, provide a concise description of your retail business, including its structure, location, and the products or services you intend to offer.

How can a retail store business plan help secure investment?

A retail store business plan demonstrates a well-thought-out strategy, outlining business goals, target market, competitive analysis, and financial projections. It reassures investors, making your venture a more appealing investment opportunity.

What common mistakes should I avoid when creating a retail store  business plan?

Common mistakes include excessive detail, poor financial planning, and grammar/spelling errors. To avoid these, focus on clarity, accurate financial projections, and proofreading.

Remember:  This is not legal advice. If you have questions about your particular situation, please consult a lawyer, CPA, or other appropriate professional advisor or agency.

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Retail Business Plan

A retail business plan is a document that gives you and your potential investors a roadmap on how your new retail business intends to get started and deliver its business goals over its initial few years (usually 5 years).

It is usually broken down into sections about the company, the industry it operates in, the competition it will face and a plan that covers marketing, financials and operations over the first few years in business.

Also check out this one-page Business Model Canvas for a retail business .

Retail Business Plan Template

You can download this free retail business plan template from the link below. You will be able to edit the word file and export it into PDF format afterwards.

In the coming sections, we will explain the different components that go into the retail business plan, which you can then apply to your own plan when completing the template.

Retail Business Plan Template

Check out more free downloads .

Executive Summary

We recommend writing the executive summary at the end of the process, after you have filled out all the other sections in the retail business plan template.

In the executive summary you will cover the following points briefly:

  • Types of products sold at the store
  • Customers served by the store
  • Company mission & vision
  • Market share to be captured

You will also mention the total amount you will need to start this business, backed by the financial plan you prepared as part of this business plan.

The total amount that you want to borrow or have invested in your business will be the sum of pre-opening costs (initial inventory, equipment, rent,..) and the maximum negative cash flow as per your cash flow plan.

If you are writing this retail business plan for a financial institution to get a loan, mention how you expect to repay the loan, and you should have already included the loan installments in your financial plan.

If you are writing this plan for investors, mention how much equity they will receive in return for this investment and the expected return on investment, and expected cash distributions (dividends) based on your financial plan.

For example

An investment of 100,000$ in the business will result in the investor receiving 20% equity. We plan to distribute 50% of the profits every year, and based on our financial projections this will be a xx,xxx$ in the first year, xx,xxx$ in the second year, and xx,xxx$ in the third year,..etc.

Company Overview

Here you will write about your business and give a brief overview about the type of store you will be starting.

You can cover the following points:

  • Store category (e.g. beauty store, toy store)
  • Store location and brief description of the area
  • Product categories carried
  • Company legal structure

Industry Overview

Write an overview about the industry (retail/ecommerce) as a whole and the most recent trends specific to this industry.

Cover areas such as:

  • Total retail sales
  • Contribution of your retail category to the total sales (size of the market)
  • Online vs. Brick & Mortar trends
  • Recent industry trends and shifts in terms of products you are selling

You can find the most recent insights about retail in our Retail Statistics page.

Read Also: What is Retail ?

Target Market

Write about your target customers that you know will be interested in your products. Mention demographic and psychographic details in this section. This will help afterwards in drafting your marketing plan.

You can cover the following details:

  • Age bracket
  • Income level
  • Educational level
  • The specific needs that your products will fill for them

retail design business plan

FOUNDATIONS OF MARKETING

  • Learn the fundamentals of marketing
  • See how they apply to buying, merchandising & pricing
  • Real-life case studies and examples

Competition

List the current competition in the market that are serving your target customers. Mention your top 3 competitors in your area.

You can also include indirect competition, such as online stores or marketplace sellers, if you think this might affect your business.

Cover information about:

  • No. of stores
  • Size of stores
  • Product categories they sell
  • Pricing level
  • Sales per day estimates
  • Strengths & Weaknesses

You can also create a summary table like the one below

Competitive Advantage

What will make customers leave the competition and come to you? Use the weaknesses areas that you mentioned about the competition in the previous section, and mention how you will improve on them.

This could be by:

  • Superior quality
  • Better prices
  • Convenience
  • More variety
  • Better shopping experience

Marketing Plan

Describe your marketing strategy for your store and which channels you are going to use.

Cover the following areas:

  • Brand Positioning
  • Branding Strategy (Persona, tone, language,..)
  • Product Strategy (Key products and product features that will attract your customers)
  • Pricing Strategy
  • Promotional Strategy
  • Marketing Channels

Operations Plan

Write how you will operate your store and include details about your manpower plan.

This will include the management that you will hire for the store, visual merchandisers, sales staff and cashiers.

Cover the following:

  • Management structure (store manager, supervisor,..)
  • Staff plan (3 sales associates, 2 cashiers, etc.)
  • Brief role descriptions
  • Compensation structure

Read Also: Retail Scheduling

retail design business plan

RETAIL OPERATIONS MANAGEMENT

  • Managing Store Operations
  • Areas of Responsibility
  • Assessing & Managing Performance

Financial plan

List estimates for the capital you will need to start and financial projections for the following years.

Capital Needed

Start with how much capital you will need to start the business

This will include:

  • Initial rent
  • Initial product order (Inventory)
  • Initial staff salary
  • Store fixtures
  • Store equipment

Read Also: How Much Capital You Will Need For a New Retail Store?

Financial Projections

Include a 5-year financial projection for the business based on your forecasted sales and costs.

P&L Management Excel

  • Monthly income statement (P&L) for the first year
  • Yearly income statement for the following 4 years
  • Monthly cash flow projection for the first year

Learn how to create a sales budget for a new store, and 3 years financial projections in our Retail Budgeting Course

retail design business plan

RETAIL BUDGETING & PLANNING

  • The step by step retail budgeting process
  • Set monthly targets adjusted to seasonality
  • Templates download & practice exercise

Break Even Point

Include a snapshot of the 5-year P&L plan here and mention the SPD (sales per day) you need to breakeven, based on your P&L numbers.

We have created a sample table with retail data in the business plan template, and you can fill it with your own numbers.

Key Assumptions

Mention the assumptions you used for creating your financial projections.

For example , you assumed that sales per day for the first year will be 1000$ and then will grow by 20% in the second year, 15% in the third year and 10% in the fourth year, etc.

Retail Business Plan Tips

Sales projections.

We recommend being very realistic about your initial sales per day projections, as your entire financial plan will be directly affected by it.

When you then forecast your growth for the coming years, you should also be realistic about how much you will grow year-on-year.

From our experience, retail stores typically see higher growth after the first year and then this starts to level off from the third year onwards.

Having said that, there might be other growth drivers that can affect your business and accelerate your growth in the following years. This could be for example that your new store is in an area that is still under development and will be fully developed by the third year.

What we want to say is, do your due diligence thoroughly and based on that set realistic expectations.

Inventory Projections

The biggest asset you will hold and the biggest part of the investment/loan you will need to start your retail business will go for inventory.

So it is important to calculate your inventory needs correctly.

This will be based on your sales forecasts and the inventory turnover rate you expect or the forward stock cover you intend to maintain.

For example, if your inventory turnover target is 2, this means you maintain a 6 months cover. If your inventory turnover is 3, you maintain 4 months stock cover,..and so on.

We recommend checking out the benchmarks we have listed for different retail categories for inventory turnover and reading our complete Open to Buy guide to get started with calculating exactly how much inventory you will need.

Good luck in your new venture!

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Thank you for reading this article on Retail Business Plan. We recommend the below free resources as well:

  • Retail Management
  • Starting a Retail Business
  • Buying a Retail Business

Join the academy and get all access to all our resources, which will help you manage your retail business more efficiently.

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How to Start a Retail Business: A Step-by-Step Guide

Sally Lauckner

Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money .

If you’re thinking about starting a business in the retail industry, you’re in good company. Although local retailers don’t get the same level of attention as nationwide brands do, small retail businesses actually make up the vast majority of all U.S. retail businesses.

In fact, researchers found that small retailers (with 50 or fewer employees) made up 98.6% of all retail businesses in 2019. To break into this vibrant industry and open a store of your own, therefore, you first need to understand how to start a retail business.

To help you through the process, we’ll guide you through all the steps required to start a retail business, as well as offer additional resources to assist you on your startup journey.

retail design business plan

How to start a retail business in 10 steps

These steps will have you running your retail business in no time. Let’s get started.

Step 1: Find your niche.

The first decision you'll need to make in order to learn how to start a retail business is figuring out your company's niche. You may already have an idea of the type of company you want to form, or you may still be grappling to figure out where to focus your retail company. To determine your niche market, we recommend:

Explore your interests and passions: Determine what you love doing or what you'll enjoy selling.

Brainstorm potential conflicts: No industry is perfect, but figuring out what obstacles or issues you could encounter in your niche will help you plan ahead and determine if an industry is a good fit for your business.

Consider profitability: At the end of the day, you want to make money from your retail business, so you'll need to find a niche that has the potential for profitability. Generally, if your niche has absolutely no competitors, it's usually a sign there's no demand, and therefore, your focus will not be profitable. Use our guide to learn more about the most profitable business ideas.

Research competitors: Once you've found a niche market using the above three steps, it's time to research your competition. Figure out how they're marketing and selling and determine what you can learn from them and how you can improve upon what they have to offer.

Retail business examples

Deciding on your niche can take a long time. It requires significant research and the passion to work within a particular market. To help you get started in identifying your niche market, here are a few retail business examples worth exploring:

Coffee shops

Apparel shops (eyewear, sports apparel, undergarments, outerwear)

Restaurants and bars (determine a theme, whether that's the cuisine, small plates, a canteen, etc.)

Game centers (board games, video games, etc.)

Monthly box subscriptions

Pet supply shop

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Step 2: Write a business plan.

We don’t doubt that you have an amazing idea for a retail store, but an idea alone isn’t enough to turn a dream into a reality. By writing a business plan, you’re providing yourself (and, potentially, future lenders and other stakeholders) a physical roadmap detailing every step you’ll take to open and run your retail business.

Therefore, when you're crafting your business plan for opening a retail store, you can start by answering essential questions about your business model:

What kinds of products are you selling?

Will you open a brick-and-mortar location, an e-commerce website , or will you take an omnichannel selling approach?

Who is your target market, and how will you market to them?

How will you set your store apart from your competition?

You’ll also need to dig into details related to your processes, answering questions such as:

Who are your vendors? How will you store your inventory?

How much staff will you need?

What will your hiring process look like?

What will your startup costs be?

How much money will you need to launch?

How long will it take for you to break even?

How long will it take for you to make a profit?

Keep in mind, however, that your preliminary business plan is exactly that—preliminary. You can always return to your retail store business plan to make changes, updates, and additions as you gain experience with starting and running your business.

Create a business budget

Along the same lines, you should also create a business budget, to the best of your ability, well before you’ve opened your doors. At this stage, you should be paying especially close attention to your startup costs.

Unfortunately, if you're wondering how to start a retail business with no money, you're going to find it's extremely difficult. Although there a variety of ways to cut costs—selling online instead of opting for a physical location, for example—there will always be a handful of costs associated with starting and launching your retail store.

This being said, in addition to standard startup costs like equipment, business insurance, and payroll, if you’re opening a brick-and-mortar retail store, you’ll have to cover some specific costs, like a down payment, potential renovations, and monthly rent and utilities for your store. You’ll also be responsible for purchasing your merchandise, shipping and delivery costs, and storing excess inventory.

And don’t forget about the other tools and software you’ll need to run your business, including a POS system, retail accounting software, and a security system to monitor shoplifting and theft.

Step 3: Register your business.

With your business plan and budget in hand, you can now move onto the next step involved in learning how to start a retail business—making it official.

Come up with a business name

If you haven’t already, you’ll first need to come up with a business name. Choose a name that reflects your business’s purpose and brand identity, allows you room to grow, and, perhaps most importantly, is actually available for use.

Once you’ve landed on your dream business name, run your moniker through a Google search to make sure another entrepreneur isn’t already doing business under that name. Then, check for trademark filings in the U.S. Patent and Trademark Office, and conduct a Secretary of State business search to make sure there isn’t another business in your area with your potential name.

Once you’ve established that your name is free and clear, you'll want to buy your domain name and create social media accounts with your name. That way, you can build a business website and launch your marketing strategy ASAP.

Determine your legal structure and register your business

Next, in order to register your business, you’ll first need to decide on your business’s legal structure. Your business structure determines how you’re taxed, the degree of legal protection you’re afforded, your business’s ownership structure, and your ability to receive business funding (in addition to allowing you to register your business in the first place).

There are lots of business entities to choose from—all of which we overview in detail in our guide to types of business entities. Additionally, we’d highly recommend consulting a business attorney or accountant to guide you through this crucial step.

Once you’ve landed on a business entity type, you can go ahead and register your business through your state’s Secretary of State website. After that, head over to the IRS' website to apply for an EIN (employer identification number) online. Your EIN is a bit like your business’s social security number, and it’ll help the government identify you for tax purposes. You might also need an EIN to apply for a business loan down the line.

Step 4: Obtain licenses, permits, and business insurance.

Some states require a general business license, while others require licenses and permits at an industry level. You may also need to acquire local permits and licenses, so consult your county or city clerk’s website for their particular requirements, too. The SBA is an excellent resource for licensing and permitting information at both the federal and local levels.

For those learning how to start a retail business, you’ll likely need to obtain multiple retail licenses related to your field, including a resale certificate, seller’s permit, and a certificate of occupancy. We also recommend partnering with a trusted business attorney during this step.

Additionally, you won't want to forget about business insurance. As a retailer, you should consider general liability insurance, a business owner’s policy, and business crime insurance; and as an employer, you’re likely required by law to carry workers comp insurance, health insurance, and unemployment insurance for your staff.

Take a look at our guide to small business insurance for more information on the types of coverage you need.

Step 5: Find a physical location and build an online store.

If your retail business will include a physical store, finding the right location is arguably the most important aspect of this process. Your location can make or break the success of your business: If you’re located in a heavily trafficked area, then your marketing efforts are practically built-in. If it’s in a tough-to-find location, or if parking is limited, then your bottom line might suffer.

The right location for your business depends largely upon who your target market is and where they hang out. If you’re opening an upscale boutique, for example, you probably want to choose a neighborhood that skews less toward students and cash-strapped millennials, and more toward people with some discretionary income to burn.

Of course, you’ll also have to keep in mind how much space you need for display areas, a back-office and break room for your staff, dressing rooms, and an inventory storage area. Your location will also depend largely upon how much room you have in your budget for renovations, store design, remodels, updates, a down payment, and your monthly rent and utility bills. That may mean opting for your second or third choice location to protect your budget.

Build an e-commerce store

Even if you always dreamed of a brick-and-mortar store with in-person transactions, we also recommend opening an online store to give your retail business as much exposure as possible.

Luckily, building and managing an online store is incredibly easy with an e-commerce platform. Here are a few recommendations to get you started:

Shopify: This platform provides an infinitely customizable, standalone store that you build and manage entirely on your own.

Squarespace or Wix: These business website platforms are simple to use and offer e-commerce functionalities.

Etsy, Amazon, or eBay: These popular marketplaces will provide you with plenty of built-in traffic and handy seller tools. On the downside, you won’t have as much control over your branding, customer relationships, or fulfillment process as you would with your own e-commerce store.

The combination of e-commerce and in-person retail is sometimes referred to as "bricks and clicks." You can use our guide to learn more about the bricks and clicks business model.

» MORE: How to start an online boutique

Step 6: Establish relationships with vendors and suppliers.

This is the next step to learning how to start a retail business—and beyond your store’s location, arguably one of the most crucial aspects of your potential success—is finding trustworthy vendors and suppliers. Your vendors might become your most valuable partners and a great vendor can present you with new merchandise, determine which products will sell best, and cut costs for you.

There are a few considerations to keep in mind as you’re searching for vendors.

Budget: Your vendors need to work within the supplier budget you’ve established.

Quality: The quality of their merchandise is crucial.

Reputation: You want to work with a supplier who is guaranteed to deliver your agreed-upon items on time and in good condition—every time you place an order.

Customer service: Remember that you’ll be working closely with your vendors, so their service team must be reliable, personable, and easy to contact in case you run into any issues.

We recommend establishing relationships with several vendors. Even if your vendor of choice is stable, reliable, and cost-efficient, you need to have a contingency plan in place—without merchandise to sell, you won’t have a business to run.

Step 7: Hire staff.

If you’ve never hired an employee before, take a look at our guide on how to hire great employees who’ll stick with you for the long run. When hiring for a retail position, make sure to interview as much for their attitude as you are for their experience. While you can train your employees to use your POS system and manage your inventory, you can’t teach them to be kinder, friendlier, or more trustworthy than they innately are.

In advance of hiring your first team member, make sure you understand your state-regulated employer requirements. Your state might require that you buy certain types of insurance for your staff. Additionally, you’ll probably need to complete some other steps, like creating a state withholding account for payroll, reporting new hires, and verifying your potential new hire’s employment eligibility as well.

Step 8: Find the right POS system.

Your POS system just might become your retail business’s best friend. It’ll certainly become your employees’ best friend—assuming you choose an intuitive, easy-to-use model, of which there are tons on the market right now.

A point of sale system combines hardware and software that enables your business to accept and process all kinds of payments. Most POS software is loaded with valuable back-end capabilities, like inventory management, employee management, CRM tools, sales reports, and vendor tracking.

If you’re opening a brick-and-mortar location, you’ll need a POS system that can accept cash, checks, contactless payments, and both chip and swipe cards. In addition, you’ll need a barcode scanner, receipt printer, and cash drawer.

For more flexibility, you might want to look into a POS system that allows on-the-go payments, too. For example, Square (and most other POS systems) has mobile card readers that plug into your phone or tablet so you can accept payments from virtually anywhere, whether that’s at a pop-up shop, craft fair, or trunk show.

Similarly, Clover also has a fully equipped, handheld POS device so you or your staff can ring up your customers from anywhere in your store.

Ultimately, you have options—a lot of them. To help you navigate the selection process, consult our guide on the best retail POS systems.

Step 9: Organize your finances.

As we mentioned earlier, it's nearly impossible to figure out how to start a retail business with no money—so, whether you have a large amount of startup capital or are operating on a tight budget, it's extremely important to organize your finances.

First, you'll want to open a business checking account . If you’re happy with your current bank, you may want to open a business bank account there. It’s logistically easier for you to maintain all your finances with the same institution. In addition, many banks offer discounts and other incentives when consumer clients open business accounts. If you want to compare your options, we recommend looking into our best business bank accounts guide.

Next, you'll want to get a business credit card . Most credit card companies allow business customers to apply for a business credit card online—which makes this step even easier than opening a business bank account.

If your business is too new to have any financial data, you can provide your personal financial information on your application. If you’re approved, you’ll receive your card in the mail in about a week or two. Use it for your business’s smaller, daily expenses, and be mindful of only using it for business-related purchases to maintain personal and business financial separation.

Get funding

Most entrepreneurs need a little (or a lot of) financial help to get their businesses off the ground. That may be especially true of retailers and brick-and-mortar business owners, who have a few extra startup costs to contend with.

Although it can be difficult to get a business loan as a startup, there are a variety of alternative options you can consider, especially as you start to run your retail store and become more established.

Finally, don’t forget to sign up for a good business accounting software solution, which will streamline, automate, and organize your business’s finances.

Step 10: Market your retail business.

At this point, you've learned the most important pieces of how to start a retail business, and now, you're ready to open your doors and get to work.

Of course, to get the word out about your business, you need to develop a small business marketing strategy, which provides you with an opportunity to get a little creative. The best marketing strategies, especially for brick-and-mortar stores, use a combination of SEO, social media, email marketing, paid online marketing strategies (if their budget allows for it), and analog marketing efforts.

At the very start of your venture, your time is best spent building a business website and creating social media accounts. Squarespace and Wix provide users with tons of customizable, professionally designed templates and built-in SEO tools. For social media, focus on creating diverse, high-quality content, posting regularly, and responding promptly to your followers’ comments and DMs—both the positive and the negative.

As a brick-and-mortar store owner, in-person marketing tactics are also important. We recommend:

Getting active in your local retailer community, networking with your fellow business owners, and participating in craft fairs and other events showcasing local businesses.

Partnering up with a local business whose target market is similar to yours and putting on an event together, or hosting pop-up shops or trunk shows in each other’s locations.

Using good sales incentives—like BOGO deals, giveaways, and free trial periods—to draw even more customers into your store.

To boost your marketing strategy, it's important to take some time to develop your brand identity. Establish your messaging, market positioning, and how your unique business can provide your customers with what they’re looking for—then create the materials to reflect those core values.

ZenBusiness

Start Your Dream Business

The bottom line

As you navigate the business formation steps, be careful not to lose sight of why you’re opening your retail business in the first place. If you remember the passion that inspired you to launch your business, you might even enjoy the finer points involved in the process—who knew finding a POS system could be so fun?

This article originally appeared on JustBusiness, a subsidiary of NerdWallet.

On a similar note...

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The Science Behind Successful Retail Showroom Design

Is your showroom set up to make selling easy? Veteran hot tub retailers may think you have this aspect of your business down, but are you sure? Is there retail science backing your showroom design and merchandising plan?

Or the real question: Is your showroom design creating the most possible value for your business?

As competition for discretionary dollars has risen over the years, understanding consumers’ shopping habits has become increasingly critical. And though it’s true that most consumers perform extensive internet research beforehand, Canada’s  Better Your Business project reports that “up to 75% of product purchasing decisions are made in the store … Of those, all are made within the last three feet.” When it comes to business performance, the layout, look, and feel of a retail space actually does come down to a science.

Just ask Paco Underhill, founder and managing director of Envirosell Inc ., who advises companies on how small changes in retail environments can add up to increased sales. Underhill has made a career out of researching the interaction between customers and their environment. And based on these findings, many of his recommendations are now considered rule-of-thumb by the retail industry. But how do they apply to the spa retailer?

Retailers' common goal is to effectively present product in a way that emotionally engages the customer while optimizing traffic flow.

From a scientific perspective, spa retail is no different than other types of retail. Despite the variations in size and shape of retail space, all retailers’ common goal is to effectively present product in a way that emotionally engages the customer while optimizing traffic flow . In this article, find out how your merchandising design strategy can ensure you are making the most out of your selling space.

Basic Layout Principles

Your retail presentation begins in the parking lot but gets critical once the front door is cracked. In a 2015 Harvard Business Review article, Magids, Zorfus, and Leemon document that the more emotionally involved a customer becomes in a retail space, the higher the chance that they buy. And Underhill found that how a retail space is configured can influence customers’ sense of comfort during the shopping process. So it’s important for spa dealers to keep their retail space open and inviting. Any low ceilings or confined spaces should be avoided. Underhill points out that more maneuvering room extends time customers spend in the store, improving the probability of purchase.

Sample Showroom Layout

Store Entrance

Research has found that retailers benefit from having a “decompression zone” at the store entrance that is open, inviting, and easy to navigate where customers can process transition. It’s been proven that customers need a few moments to adjust to their surroundings before they are ready to take in new information. Kizer and Bender explain that, since they’re in a transition mode, customers are more likely to miss any product or signage you place there. So for most spa retailers, the first 5 to 15 feet worth of space (depending on store size) would be an ideal “landing strip” for the shopper to simply get a sense of what they’re looking for and how to go about finding it.

Shopping Traffic Path

When it comes to store design, retailers typically apply one of three layouts: the grid where fixtures run parallel to the walls (think grocery store aisles), the free flow which has no set aisles or straight lines (i.e., your quintessential boutique store), or the loop that offers a clearly defined main aisle which circles through the store.

Given the form and function of the hot tub product, the loop generally works best for spa retailers. It keeps traffic moving in one uniform direction throughout the entire store, but gives the customer the option of stopping at each hot tub and walking completely around it.

The next step is to decide which direction this loop should go, clockwise or counter-clockwise? According to Underhill as well as the Association of Consumer Research , 90% of Americans generally want to turn right when they enter a store. Whether this has to do with the fact that most people are right-handed or that Americans are programmed to stay right because of the side of the road they drive on has yet to be scientifically determined. But it doesn’t change the fact that loops are most effective when they direct the customer to turn right upon entering the store.

Product Placement

Chevroning , or positioning display shelves or racks at an angle rather than at the traditional 90-degree angle to the aisle, is another concept Underhill introduced to maximize customers’ view of the merchandise. This principle also holds true for larger products that do not require shelving, including hot tubs. As a result of the units being turned at a 45-degree angle, more of the spa product is exposed as customers approach.

...the more customers see, the more they purchase.

The logic behind the recommendation is “the more customers see, the more they purchase.” Additionally, customers see the product from a more inviting and interesting angle. They won’t necessarily know why, but customers will report that they like a spa at an angle more than one presented head on.

For smaller-priced, high-margin items, most retailers intuitively know to place impulse purchase opportunities near the checkout while directing repeat business towards the back of the store. But what comprises these two categories? Impulse purchases for spa retailers may include candles and packets of spa scents, things customers don’t usually think about. Repeat purchases would be chemicals and other maintenance products. By encouraging customers to walk through the whole store, you may be able to create interest in your latest and greatest products with those who have already demonstrated an appreciation for hot tubs, facilitating conversations about a new spa purchase.

To draw customers in and present a more inviting space, it’s essential to make your products accessible. By placing stairs and spa rails on popular hot tub floor models, your customers can feel welcome to get in and try it out. Sitting inside the hot tub provides a better understanding of what it would feel like to be a hot tub owner given the more experiential perspective.

Spa retailers that can go one step further by offering actual product testing environments and appointments will have an even greater potential for augmenting customer emotional buy-in and driving in-store traffic. Like all product trial experiences, test spas help move a sale forward without pressure. Letting your hot tubs speak for themselves is a much more effective sales tactic, especially if you can get the whole family’s buy-in at the same time. Plus, when you’re one of the few spa dealers in an area that has a test spa, customers are more likely to choose your store first. If you’re one of the few who doesn’t have a test spa, you’re likely losing business to the competition.

Purchase Consultation Area

When it comes time to discussing transaction details, it helps to have a dedicated area set apart from store traffic. A comfortable, quiet meeting space allows you to make the agreement process conversational without the added pressure of a dreaded back office. This space is also ideal for displaying a credibility wall that speaks to brand identity with authorized dealer plaques, awards, BBB certificate, photos of local business-sponsored groups, and spa install photos. Dealers often tie their patio furniture offerings and backyard decor into this space, making it a  casual setting that fosters openness and trust rather than intimidation.

Building Atmosphere

The atmospherics of your showroom really can make the difference between a showroom that shows and a showroom that sells.

Atmospherics were originally defined as the effort to design buying environments to produce specific emotional effects in the buyer that enhance his/her purchase probability. This idea referred to leveraging the psychological impacts of a person’s five primary senses on decision-making. Basically, retailers don’t need to change the product or advertising to see more sales. All they have to do is create an environment that entices customers.

There is a well-established body of research on the value of creating a comprehensive shopping experience through creative use of lighting, arranged displays, and space, and few have taken that to heart as well as Eric Mercier, sales manager for Piscene Hippocampe located in Delson, Quebec. The store underwent a massive remodeling two years ago, and since then he attributes about 25% of the store’s sales growth to innovative changes to the ambience.

Store Ambience, Piscine Hippocampe, Delson QC

Photo courtesy Piscine Hippocampe

The goal of an atmospheric shopping experience is immersion, he says. Comfortable customers who are immersed in their environment tend to forget that they’re out shopping and are more likely to stick around and browse. This keeps customers in the store longer and gives your sales reps more time to find the right solution.

Here are keys tools dealers can use to optimize atmospherics in the spa showroom:

Point of Purchase Displays

showroom POP

Furthermore, making the effort to place sold signs on spas around the showroom can subliminally communicate store success, producing a sense of buying urgency to new customers. If the overall goal of your showroom is to convert customers from mere prospects into revenue-generating purchasers, POP displays can be your secret weapon for success.

The choice of music in your showroom can also influence customer perceptions of your business. Background music is a powerful tool to help customers relax and feel at home—as long as it’s handled right. Your musical choices must align with the goals of your business and the preferences of your market.

Typically, calm and soothing music helps customers relax and can even help them visualize how your spas will look in their own homes. Songs from our younger days tend to resonate best with our psychology; aim for tracks that were in vogue during your target market’s early to mid-20s. For most spa buyers, these songs will have been hits between the mid-‘70s and the mid-‘90s. Choosing relaxed tunes from these eras will trigger nostalgia in your markets and subconsciously relax them, making them more attuned to the products on display. Plus, it gives your staff something to groove to during business hours.

Showroom Lighting

A key addition to the Piscene Hippocampe showroom floor was the installation of spotlight lighting, Mercier says.

“When the lights shine on the spa, it looks majestic, like a paradise in the middle of the showroom,” he said. “It’s about making the product look special.” Doing so helps the customer tune out other visual cues and focus on just the product, he added.

The lighting of your showroom’s interior can greatly influence your customers’ state of mind. The goal is to find an ambient sweet spot between brightness and dimness—harsh, bright lights reflect off of typical spa product surfaces and create unattractive glares.

However, lighting that is too low will fail to illuminate your displayed products and can make craftsmanship hard to see. It’s also vital to clean each spa continuously to help it shine better in the light, Mercier adds. His salespeople consistently wipe their spas down several times during the day, often during downtime.

For the most appropriate mood lighting, think date night. Aim for soft, indirect light sources to illuminate the room while leveraging brighter track lighting for each specific display.

There is plenty of science to support the connection between color and emotion . Cool colors, such as blues and greens, are soothing. Warmer colors, such as oranges and reds, are stimulating. Metallic colors, along with black and white reflect luxury. Your market’s in-store experience will be greatly affected by your choice of showroom color scheme.

Prioritize neutral, earthy tones that don’t distract viewers from your product line. Earthy browns and greens help customers subconsciously internalize how your spas may look in natural environments, such as their own backyards. Take advantage of this by creating relaxing and natural color environments in your showroom.

Remember: Effective color design is just as much about what you avoid as what you choose. White, blank walls appear drab and give an unfriendly and sterile impression. Bright, clashing colors are distracting, unpleasant to look at, and can appear unprofessional. Prioritize soft, inviting colors that are easy on the eyes and comforting to your shoppers.

Scent choice is key in a spa store

Sure, you probably don’t have an oven in the middle of your store, but warm, inviting fragrances like lavender, fresh linen, or spice can trigger powerful sense reflexes in your customers and get them in a positive mood before they even speak with a sales rep. And even if you don’t use specific fragrances, take care to get rid of any unpleasant odors that your showroom may have. Plastic-like odors reminiscent of hospitals, for example, simply won’t do a thing to reinforce positivity in the minds of your customers!

Including plant life in a spa showroom is an easy way to improve audience engagement and attentiveness to your product line.

According to data compiled by  Psychology Today , including plant life in your otherwise barren showroom may have benefits that include:

  • Increased customer attentiveness
  • Improved perceptions of the showroom space
  • Improved sensations of well-being overall

On top of that, plants and flowers smell fresh and complement the earthy color tones that your showroom should have. There’s really no drawback—add a few plants to your showroom to give it a fresh and lively feel.

Design Works

The bottom line is, the success of your spa enterprise relies on a carefully crafted mix of layout and ambience within the showroom. At the end of the day, retail design serves as a mechanism that “transforms information-seeking into purchasing activities” and a process that can “enhance or diminish the service encounter experience.” Inevitably, it has a great impact on your business’s bottom line. As Steve Jobs so insightfully put it, “Design is not just what it looks like and feels like. Design is how it works.” So let’s make showroom design work for your business.

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Retail Store Business Plan

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Retail store is a competitive business as competition is intense in this segment. Moreover, many big giants are investing more in e-commerce and digital marketing, making this business even tougher day by day.

Having a physical retail store that offers a shopping experience along with products is a dream for many. It is not only because of the size of a business but the potential and opportunities such a business offers.

And if you are an individual who likes to interact with people, constantly improve your way of doing business, and form communities that work towards something, then you might have thought of having your retail store business.

Now, a retail store has great potential for success, but it is also a very competitive business. You’ll need a retail store business plan to help you stand apart from your competition and have a thriving business.

Industry Overview

Research suggests total retail sales in the United States were projected to amount to 6.03 trillion U.S. dollars in 2022, up from around 5.4 trillion U.S. dollars in 2018, according to the National Retail Federation .

Retail businesses come in many forms such as grocery stores, restaurants, and bookstores. There are around 4 million retail businesses in the United States alone.

The domestic retail market in the United States is very competitive, with many companies recording strong retail sales. Walmart, a retail chain giving low prices and a wide selection of products, is the front-runner in the United States. Amazon, The Kroger Co., Costco, and Target are a selection of other notable U.S. retailers.

Now, to have any genuine hope of getting noticed in such a jammed industry, you need a solid business plan to get success.

Say goodbye to boring templates

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Things to Consider Before Writing Your Retail Store Business Plan

Build a brand image.

A brand image goes a long way for any business, especially for a retail store. It is crucial to pay attention to what people think about your store, what emotions they associate your brand with, and how they perceive your products in general. Above all, what qualities make you different from your competitors?

Pick the right location

A retail store’s location can make or break the deal. Hence, it is very important to pick a location that is both convenient and accessible for your customers. As people are always running short of time, they prefer a store that is on the way and takes less time to get to. It can also act as your USP over the bigger retail stores.

Plan a good store design

A good store design that follows the major principles of consumer psychology is essential for a retail store. The strategic placement of products influences a customer’s buying decisions. Hence, you need to pay attention to it and design your store in a way that maximizes your sales.

Build communities that promote your brand

Building communities that stand by and promote the idea of your brand can be extremely beneficial for your retail store. Hence, ensure that you work towards building one. These communities can be driven by anything from a common belief to a certain cause that your brand stands for.

How Business Plan Can Help?

Regardless if you’ve been operating for a long time already, by writing up a business plan for your retail store, you can get an overview of what you want to achieve with your business, and guidelines for how you’ll achieve your goals.

A retail business plan is a solid foundation for the success of your business, whether you seek funding or not. It helps you see clearly what your business looks like and how it’s positioned in your target market.

If you need to get funding, your retail business plan will work as proof that you and your business are good for investment. Studies suggest you can double your chances of securing a loan with a business plan and grow your business.

How to Write a Retail Store Business Plan?

Writing a retail store business plan requires a good amount of research, a thoroughly competitive and customer analysis, and a little bit of extra help.

You can get help for writing your plan either through a premade template on the internet or through an online business plan software which will help you write a customizable plan anywhere and at any time.

Before you start writing your business plan for your new Retail store business, spend as much time as you can reading through some examples of retail & e-commerce-related business plans .

We have created this sample business plan for you to get a good idea about how a perfect retail store business plan should look like and what details you will need to include in your stunning business plan.

Retail Store Business Plan Outline

This is the standard business plan outline which will cover all important sections that you should include in your business plan.

  • Company Profile Summary
  • Market Research Summary
  • Marketing Summary
  • Finance Summary
  • Business Overview
  • Company History
  • Legal Structure Vision & Mission
  • Industry Profile & Market Size
  • Local Market
  • Target Market
  • Competitor Analysis
  • Keys to Success
  • Customer Survey Summary
  • SWOT Analysis
  • Products and Services
  • Pricing Strategy
  • Marketing Strategy
  • Primary Marketing Activities
  • Positioning Statement
  • The Sales Process
  • Strategic Alliances
  • Location(s)
  • Legal Issues
  • Insurance Issues
  • Human Resources (Or Team)
  • Process/Production
  • Risk Assessment
  • Startup Funding & Capital
  • Start-Up Costs
  • Sales Forecast
  • Projected Profit & Loss

What to include in a Retail Store Business Plan?

A retail store business plan consists of several different aspects. The major ones are as follows:

1. Executive Summary

The executive summary gives an overview of what your business stands for the reader. It should be written in such a way that even an outsider could get an idea of what your business is all about.

This section mainly comprises your business summary, your vision and mission statement, and your financial summary.

2. Company Profile

The company summary or company profile section of your business plan would consist of everything about your company, ranging from its location to information about your team.

While the executive summary section consists of information about the functional aspects of your business, a company summary consists of information about the structural aspects of your business.

While writing a company summary, it is a good practice to take suggestions from your team, as this section represents you as a team of individuals more than representing you as a brick-and-mortar company.

3. Market Research

Conducting market research helps you understand what you are getting yourself into. It helps you understand your target market, your competitors, and the working of the industry in general.

You can conduct thorough market research by using tools like PESTEL analysis or SWOT analysis . These tools help you conduct research specific to your business and prevent you from wasting your time on vague data.

4. Marketing Plan

As a retail store, it is your primary job to let your customers know about your existence. And to retain them once they start coming to your store.

A good marketing plan would help you do just that.

Based on the information you have gathered about your target audience through market research you can design your marketing campaign and promotional offers that’ll appeal to your customer base.

5. Operations

As a retail store, a proper operations plan can prevent your business from turning into a chaotic mess. An operations plan consists of your business’s logistic and functional information. It helps an outsider see what a typical day at your business looks like.

It also consists of your long-term and short-term goals. As well as the milestones you’ll have to reach for achieving them.

As a retail store business, your operations plan would consist of your supply renewal cycles, your backup distributors, a plan for the working of your store, your daily sales targets, and your long-term expansion goals, etc.

6. Financial Plan

A financial plan ensures that your business sails smoothly through tough times and also generates maximum profits.

It would consist of your funding requirements, cash flow projections, and profit forecasts.

As a retail store, your financial plan would consist of the funding requirements for setting up your store, buying supplies, and hiring people. It would also consist of your projected profits and break-even analysis.

Download a sample retail store business plan

Need help writing your business plan from scratch? Here you go;  download our free retail store business plan pdf  to start.

It’s a modern business plan template specifically designed for your retail store business. Use the example business plan as a guide for writing your own.

The Quickest Way to turn a Business Idea into a Business Plan

Fill-in-the-blanks and automatic financials make it easy.

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Retail Store Business Plan Summary

In conclusion, a retail store business plan helps you organize and manage your store better. It takes care of everything that goes behind the scenes of running a retail store, so you can greet your customers with a smile.

From angry customers to poorly stocked supplies, a business plan can save you from all of it.

After getting started with Upmetrics , you can copy this retail store business plan template into your business plan and modify the required information and download your retail store business plan pdf or doc file.

It’s the fastest and easiest way to start writing your business plan.

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Starbucks has a new accessible store design. Take a look inside

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  • Starbucks opened a new cafe designed to be more accessible and inclusive for customers and employees with disabilities.
  • Changes include tweaks to the stores' lighting and acoustics, as well as lower counters.
  • All future company-owned locations will follow a similar framework.

In this article

Starbucks has unveiled a new store design focused on accessibility and inclusion, with fresh light fixtures and open floor plans.

The coffee giant opened the first location with the new design on Friday in Washington, D.C.'s Union Market.

"Designing for disabilities is just good design for everybody," said Sara Trilling, president of Starbucks North America.

She added that designing a more accessible cafe took about two years and that the company solicited input from Starbucks baristas.

The Union Market cafe has power-operated doors so customers can use less effort to enter the cafe. Once inside, they can place their orders with baristas using a new point-of-sale system that has an adjustable angle stand, voice assist, screen magnification and photos of menu items.

"Imagine somebody who doesn't speak English as a first language, and you're trying to make sure that you're getting [the order] right and providing great service. You'll have an opportunity through some visual cues to make those confirmations," Trilling said.

The counters are also lower, making them more accessible for wheelchair users, for example.

Behind the counter, Starbucks' new Clover Vertica system for brewing drip coffee has a more accessible design, with a large dial and protruding buttons.

"You can actually feel the settings by touch or using light to indicate when brewing cycles and other things have been completed," Trilling said.

Digital status boards show customers when their drinks are ready to pick up, in addition to baristas calling out their names.

Starbucks also changed the store lighting to minimize glare, shadows and backlighting that can make it more difficult to see. Insulation has been improved, too, so stores aren't as noisy.

And Starbucks designed the overall floor plan of the store to be free of obstacles and to have open sightlines.

All future company-owned locations will follow a similar framework. Starbucks plans to open more than 600 new stores this year, increasing its U.S. footprint by 4%, including licensed locations.

Building more accessible stores won't be materially more expensive than using current designs, according to Trilling.

"I think about it as something that's going to help us in terms of customer connection. It's going to help us in terms of employee engagement," she said.

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Real Estate | VTA ditches plan to seize downtown San Jose…

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Breaking News

Real estate | steph curry defeats sabrina ionescu in groundbreaking all-star 3-point challenge, real estate, subscriber only, real estate | vta ditches quest to grab san jose site as train station design shifts, property is near future downtown san jose train station.

Downtown San Jose BART station entrance, West Santa Clara Street between North First Street and North Market Street, concept.

SAN JOSE — A South Bay transit agency has ditched its quest to grab a property near a future BART station after the proposed rail stop design shifted, court papers show.

The powerful Santa Clara Valley Transportation Authority has abruptly jettisoned its plan to seize ownership of a parcel in downtown San Jose through an eminent domain proceeding, according to a legal filing.

In 2021, the VTA filed a lawsuit that detailed its plan to undertake a court-ordered purchase of a property with addresses of 29 and 31 East Santa Clara Street.

But the VTA has abandoned its attempt to buy the site, according to documents filed with the Santa Clara County Superior Court.

“Plaintiff Santa Clara Valley Transportation Authority hereby abandons the above-entitled proceeding for the acquisition of the property…located at 29-31 East Santa Clara Street,” the VTA stated in court papers filed in November 2023.

This decision to dump the court case marks the second time the VTA has given up a purchase effort involving sites on East Santa Clara Street between North First Street and North Second Street.

The transit agency also has given up an effort to grab ownership of a parcel next door at 17 East Santa Clara Street. A 26-story, 200-unit housing high-rise is being eyed as a possible development on this property.

The VTA said it did not end up needing the property to build a component of the Downtown San Jose BART Station, whose proposed main entrance would be built near the two properties, according to the court papers.

The train stop is expected to be one of four BART stations located within San Jose.

The VTA used the same rationale in the two separate cases involving the properties at 17 East Santa Clara Street and 29-31 East Santa Clara Street, documents for the court cases stated.

“The design innovations for the project indicate that construction of a secondary headhouse of the project’s Downtown San Jose Station would not be required, thus removing the need to acquire the property,” the VTA stated in the court papers for the respective cases.

The principal owner of the 29-31 E. Santa Clara Street site is an entity operating as Z Hanna LLC, court papers show. Lars Fuller, an individual, is the provider of an existing mortgage on the property.

Just one San Jose BART stop is currently operating: the Berryessa station. Also planned are BART stations at 28th Street, downtown near Santa Clara Street and First Street, and western downtown at the Diridon train station near the SAP Center.

The extension to the downtown San Jose Diridon transit station, which is also served by Caltrain, is considered a vital step for regional rail services, according to the VTA’s website.

“Completion of the project will finally ‘ring the bay’ with frequent rail service,” the VTA stated in a web post.

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I turned my failed Etsy shop into a business that made $1 million in its first year. Here's how I did it by 21.

  • Keida Dervishi, 21, chose to start an embroidery business with her mom instead of going to college.
  • She started selling embroidered products on her Etsy shop at 17 but orders dried up. 
  • Consistently posting on TikTok and customization led to her business finally taking off. 

Insider Today

This as-told-to essay is based on a conversation with Keida Dervishi, the 21-year-old founder of Soulmate Customs. The revenue has been verified by Business Insider. The following has been edited for length and clarity.

As a young girl, I never thought I'd follow in my parents' footsteps. They moved from Albania to the US before I was born and owned a fashion line. I grew up traveling to trade shows all over Europe.

I was always curious about my parents' businesses, but my passion was singing and acting. As a nine-year-old, I competed in Gjeniu I Vogel, a televised Albanian children's singing competition. As a teenager, I appeared in TV shows and movies like "Fresh Off the Boat," "The Wrong Husband," and "The Council."

When the pandemic hit, I thought it was time to try something new. At age 17, I saw other teenagers on TikTok starting businesses. I purchased a $300 embroidery machine with my parents' help. I thought it would be a side hobby to earn some income. I didn't expect it to blow up. Soulmate Customs made over $1 million in sales in less than a year.

It hasn't always been easy. There have been some failures in growth that were our fault. But even with failures, we've learned from our mistakes.

I had some early success thanks to TikTok, but sales dried up fast

I got the machine in December 2020, six months after graduating from high school. I unpacked it, opened up YouTube, and searched "how to embroider," I learned how to use it in a day. After a few weeks, I felt confident enough to start selling designs.

I started with an Etsy embroidery shop before founding Soulmate Customs. Using an app called Procreate, I drew designs on my old iPad. Once I had a design I liked, I'd put it on a USB and plug it into the machine, which automatically digitized the design to embroider.

I got a few orders initially, but things boomed when I posted a design inspired by Olivia Rodrigo's song Driver's License on TikTok. The video got around 4 million views, and my shop had over 300 orders in three months. I thought, "I've made it!"

Once the song's hype died down in 2021, the orders dried up on my Etsy shop, and I freaked out.

A birthday gift for my mom was the spark for Soulmate Customs

Around the time orders dwindled, my mom's birthday was coming up. I thought, "Why don't I take a picture of me and her, outline it, and embroider it with the embroidery machine I already have?"

When my mom opened the shirt with the embroidered outline of us, she started crying. She told me it would be a great idea for a business.

Later that year, in July 2021, we launched Soulmate Customs, which makes soulmate-themed custom embroidery clothing. My mom is a cofounder because she is very involved in the business and helped set up all the legal paperwork.

We got our first order after 4 days and made our first $100,000 in 4 weeks, thanks to TikTok

After experiencing the drastic fall in orders with my first Esty shop, I knew for Soulmate Customs, I had to be promoting it on TikTok constantly.

I made vlog-style content of me embroidering. After about four days of posting, we got our first order. I did a mini-vlog of making and shipping that first order. About 30 minutes after posting the TikTok, we saw floods of new followers and supportive comments. The video was blowing up. It ended up getting 3.7 million views.

I started hearing the sale "cha-ching" on my phone repeatedly. I was sitting with my mom on the couch, and we looked at each other in shock. We got over 1,400 orders in the first month and made over $100,000 in sales. It was a huge jump-start.

The business became a family affair immediately

When those orders came in, the business was still one $300 embroidery machine in my parents' house. There was no way that I could fulfill every single order on time. I told my mom we'd have to shut down the store.

My mom said we weren't shutting down. She sent my dad to look for office space. We rented out the second office we saw and have moved twice since then. We invested in four commercial embroidery machines and hired anyone we could find just to help us fulfill all of the orders. Thankfully, we did it successfully.

The business became a family affair. My mom runs the entire production and back-end parts of the business. We call her the "Kris Jenner" of the family.

My dad deals with the operations. He fixes machines, buys new machines we need, and trains staff. My older brother Kenny handles everything marketing — running ads, email, and SMS campaigns. A big part of his work is also accounting. We are fully family-owned.

Posting constantly means momentum doesn't fizzle out

I knew from my Olivia Rodrigo success that after a business blows up on social media, it's hard to keep the fire going. So, I knew creating a lot of content would be key.

Once I get into the office, the first thing I do is post a video. I post five to eight times per day on TikTok and Instagram. It's the most important part of my day.

I work with trending sounds and video formats. I see what's going viral and copy the trend. Drama also sells. For example, I've made so many drama videos where I include customers who reach out to us with their stories. In one video, a customer reached out to us saying that one of the custom orders she saw on our page was her boyfriend ordering for another girl .

Posting a lot content on TikTok has been key to keeping our business thriving. We hit $1 million in revenue in 2022 in just 11 months.

Relying on virality is tough

We've had huge ups and downs because we rely on virality, which can be tough. Views aren't consistent, so I'm looking for more stable ways to grow the business this year.

We're still trying to figure out how we can keep on scaling at all periods of the year, not just whenever we go viral or during seasonal peaks. Valentine's Day, Mother's Day, and Father's day are when we see a bump in orders.

As a young founder, I haven't always made the right calls

When we hit $1 million, we had a super small team.

One of the mistakes that I made in growing the business last year was over-hiring. Because we grew so quickly initially, I thought more team members would help us keep growing. We hired graphic designers, extra content creators, and videographers. I overhired, and it got very costly very quickly. It was a big lesson. Now, we've found a better balance.

My focus is on growing the business rather than college

School has never been a huge priority to me. My parents didn't push me to go to college. When I would have applied for college, the business took off and sent my life in a different direction.

I didn't start the business with this endgame in mind. Now that we're at seven figures, I'm fighting with everything I can to keep it going. It's been very stressful. There have been times when I've been so overwhelmed that I don't know if I can keep going.

Reaching out to other people on social media has helped a lot. Instagram has been a big platform for me to make connections with business people and others who are doing cool things with their lives.

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  1. Retail Store Layout Design and Planning

    What Is Store Planning? Store planning is the designing and optimizing of physical retail stores to upgrade customer experience and maximize sales. It involves determining the ideal store size, layout, fixture placement, signage, and product placement to create a visually appealing and engaging shopping environment.

  2. Planning Your Retail Store Layout in 7 Easy Steps

    Step 1: Decide on a Retail Store Layout. Large or small, most retail stores use one of six basic types of retail store layouts: grid, loop, free-flow/mixed, diagonal, forced-path, and angular. The type of layout you use depends on your space, the shopping experience you are trying to create, and the products you sell.

  3. Retail Design Tips and Trends for Your Store

    Search 100+ new features to grow your business See what's new Recommended What Is Point of Sale Software? A Checklist for Choosing the Best POS for Your Business A Quick Guide to Retail Payment Options 5 Tips for Training Your Employees on a New POS The 7 Best Shopify Apps for Engaging Retail Customers The Future of Retail Report [Free Download]

  4. Retail Store Layouts: An Expert Guide To Store Design

    Retail Store Layouts: An Expert Guide To Store Design What is customer flow and why is it important in store layout and design? Before we dive into the different types of store layouts, it's important to understand what customer flow is and how it can impact your sales.

  5. How to Write a Business Plan For a Retail Store: Complete Guide

    August 3, 2022 Small Businesses Whether you're looking to raise funding from private investors or to get a loan from a bank (like a SBA loan) for your retail store, you will need to prepare a solid business plan. In this article we go through, step-by-step, all the different sections you need in your retail store business plan.

  6. Retail Business Plan Template & Guide [Updated 2024]

    Your retail business plan is a living document that should be updated annually as your company grows and changes. Sources of Funding for Retail Businesses With regards to funding, the main sources of funding for a retail business are bank loans and angel investors.

  7. Retail Business Plan Template & Sample (2024)

    Retail Business Plan Template Written by Dave Lavinsky Retail Business Plan You've come to the right place to create your retail business plan. We have helped over 10,000 entrepreneurs and business owners create business plans and many have used them to start or grow their retail companies.

  8. The Ultimate Guide to Designing an Engaging Retail Store Layout

    1. What is a retail store layout? 2. What are the components of a retail layout? 3. What makes a retail layout effective? 4. How do you design a retail layout? Discovery & Defining Project Scope Store Layout Types Customer Flow & Behavior Zone Layout Strategy Product Mapping Displays & Fixture Types 5. Store Planning Resources

  9. How to Write An Attention-Grabbing Retail Business Plan

    What are retail business plans for? They're planning and forecasting documents. Retail business plans explain your business model, who your customers are and how you plan to take your store or online shop from an idea to a profitable reality. Why are retail business plans different? Because retail businesses are different. You know this.

  10. How to Write a Great Retail Business Plan for Your Store

    It should include the logo, concept, ownership and business structure, design, and layout. Think of a retail shop that you enjoy. What is it about that business's logo, concept, and design that stands out to you? Include information from target market and industry analysis

  11. PDF ULTIMATE GUIDE Planning a Retail Store Layout

    proper store design can help prevent shoplifting by placing high-value items, exits, and security stations in strategic locations. A retail layout plan sets the foundation for designing a retail store. It covers various aspects of store design and shop planning with the following key components: • Merchandising Space • State of the Facility

  12. How to Start a Retail Business in 13 Steps

    Step 1: Create a Retail Store Business Plan A business plan is a written document containing the goals of a business, the methods for attaining those goals, and the time frame for the achievement of the goals. It is what you present to potential investors and a crucial first step for starting any business.

  13. Everything You Need to Know to Start a Retail Business

    1. Create a Business Plan. One of the first things anyone looking to start a business should do is create a business pla n. This is the document that details all aspects of your company including what you'll sell, how your business will be structured, who your target audience is, and your financial information.

  14. How to Create a Retail Store Business Plan

    A retail store business plan is a comprehensive document that outlines your business model, identifies your target customers, and lays out a roadmap for turning your retail store or online shop into a profitable business. It's a planning and forecasting tool that provides clarity and direction for your business.

  15. Retail Business Plan [Free Template Download]

    A retail business plan is a document that gives you and your potential investors a roadmap on how your new retail business intends to get started and deliver its business goals over its initial few years (usually 5 years). It is usually broken down into sections about the company, the industry it operates in, the competition it will face and a ...

  16. How to Start a Retail Business: A 10-Step Guide

    Step 9: Organize your finances. As we mentioned earlier, it's nearly impossible to figure out how to start a retail business with no money—so, whether you have a large amount of startup capital ...

  17. Step-by-step guide to creating a small business plan

    Step 1: Company description The key to a good plan is starting with what you already know and building around that theme. For starters, you don't need to write elaborate depictions and envision every single detail. A short description, a.k.a "the elevator pitch", will do the trick.

  18. How To Write a Retail Business Plan in 8 Steps (And Why)

    A retail business plan is a document that outlines a new business owner 's goals for their company. This plan commonly includes the guidelines and rules the business will follow, the business idea, background and financial information. Here are some of the most important elements of a business plan: Executive summary

  19. The Science Behind Successful Retail Showroom Design

    Your retail presentation begins in the parking lot but gets critical once the front door is cracked. In a 2015 Harvard Business Review article, Magids, Zorfus, and Leemon document that the more emotionally involved a customer becomes in a retail space, the higher the chance that they buy. And Underhill found that how a retail space is ...

  20. Retail Store Business Plan

    A good store design that follows the major principles of consumer psychology is essential for a retail store. The strategic placement of products influences a customer's buying decisions. Hence, you need to pay attention to it and design your store in a way that maximizes your sales. ... A retail business plan is a solid foundation for the ...

  21. Write your business plan

    Executive summary. Briefly tell your reader what your company is and why it will be successful. Include your mission statement, your product or service, and basic information about your company's leadership team, employees, and location. You should also include financial information and high-level growth plans if you plan to ask for financing.

  22. Here's what the Starbucks of the future looks like

    On its site, the company has a "Retail Checklist" available to download, which lays out a tiered plan for designing inclusive spaces "that elevates retail environments, beyond the ADA."

  23. Simple Business Plan Template (2024)

    This section of your simple business plan template explores how to structure and operate your business. Details include the type of business organization your startup will take, roles and ...

  24. Starbucks has a new accessible store design. Take a look inside

    Starbucks plans to open more than 600 new stores this year, increasing its U.S. footprint by 4%, including licensed locations. The store's lighting is softer, and insulation keeps noise levels lower.

  25. Target-anchored shopping center in Powell to gain adjacent retail

    The center will be directly adjacent to Target, and will have 311 parking spots to go along with the 475-space lot in front of the existing store, which is located at 10560 Sawmill Pkwy.

  26. Nolensville approves plans for 27-acre town square development

    Two local firms are teaming up to bring a first-of-its-kind development to Nolensville. Land Innovations and Rochford Realty are planning a 27-acre mixed-use development which will be the city's ...

  27. How to Write a Great Retail Business Plan for Your Store

    It should include the logo, concept, ownership and business structure, design, and layout. Think of a retail shop that you enjoy. What is it about that business's logo, concept, and design that stands out to you? Include information from target market and industry analysis

  28. VTA ditches quest to grab San Jose site as train station design shifts

    The transit agency also has given up an effort to grab ownership of a parcel next door at 17 East Santa Clara Street. A 26-story, 200-unit housing high-rise is being eyed as a possible development ...

  29. I Turned My Failed Esty Side Hustle Into a Million-Dollar Business

    When 21-year-old Keida Dervishi started an Etsy shop for her embroidery designs, she didn't plan on launching a multiple 7-figure business.