28.03.2024

How to open a furniture store?

To begin with, experts advise conducting a marketing study. See what competitors are trading, what is their advantage and disadvantage. Business intuition should work. First of all, you need to understand what niche you want to occupy. Stratification of the target audience is strong. 

There are those who buy expensive imported furniture. There are those who come only from the functional features of furniture – for them, design and manufacturer are not important.

First of all, the beginner must take into account that the furniture market has already taken shape. And if 15-20 years ago you could bring any furniture and find a buyer for it, it is now difficult to guess the needs of the client. Therefore, you need to study the market and focus on those segments of the population that you want to serve. On the intricacies of this business portal BIOBOSS told the coryphaeus of the market with many years of experience, the general director of the network of furniture stores «Your life» Farid Safin.

Where to start?

Beginning entrepreneurs, as a rule, do not have a lot of capital and the opportunity to occupy large sales areas for samples. Therefore, it is advisable to start working with the economy and middle class, where the bulk of buyers are concentrated.

You can consult with those who have been working in this market for a long time. They can come from partner manufacturers who produce furniture and know what there is demand for. In Russia, such manufacturers are established companies that contain marketing services, constantly study demand, go to exhibitions.

By the way, visiting furniture exhibitions is a good way to study the market. Manufacturers there expose existing and new samples of furniture and monitor the reaction of visitors. At the exhibition there are a lot of both ordinary buyers and representatives of retail chains, they conclude contracts with manufacturers for the supply of furniture.

Working with the supplier, you can find out what kind of furniture in the region is in demand. Because the demand differs depending on the region. Somewhere one color and model is popular, somewhere – another. For example, in Tatarstan, where there are many Muslims, the green calm tones are in favor. But furniture models throughout Russia are basically the same. Stand alone are Moscow and Peter – there is a demand for advanced models. The most ultramodern modern trend is first mastered in Moscow and St. Petersburg, and then goes to the regions. Therefore, if you are opening a store not in these capitals, then it is better not to immediately bring here unusual furniture – it is unlikely that she will find a buyer.
How to beat competitors? We need to find those models that can compete with price and quality with those who are already on the market.

Speaking of us, we have been working on the market for a long time and cover all categories of customers – from economy class to VIP clients. In our salons you can see the catalogs of expensive furniture, we exhibit some samples of Italian, Belarusian furniture of high quality. The customer makes an order, and we contact the manufacturer. Orders for expensive furniture are infrequent, so keeping all the models in the store is unprofitable, as renting retail space is not cheap.

Investment size

In addition to purchasing cash registers and rental payments, you will have to pay for the help of accountants, lawyers, and coaches who will train your staff. You also need to buy samples of furniture, organize stands. The money will go to the salaries of sellers, transport logistics. On an average of 100 sq.m. you need 1.5-2 million rubles for retail space. If your salon opens in a furniture shopping center, then there will be no special spending on advertising – you just need to order an eye-catching sign. If you are located in a separate building, then in addition to the sign, you will need to pay for advertising in the media.

In addition, perhaps you will need the services of a designer. After all, the furniture in the cabin must be put up in the interior solution. If this is a bedroom set, then there must be bedspreads, pillows, so that the furniture looks beautiful. If the cabinet furniture, you can supply it with household appliances (TV, etc.), so that the buyer can evaluate how this furniture will look in his apartment.

This year marks the 20th anniversary of how we started to work under the brand «Your Life». We started to advertise with simple signage, launched advertising in the media. Today many salons pawn in the budget of their enterprise from 2 to 5% of turnover for advertising. This is especially important at the initial stage, when the enterprise is becoming. Even if you have exclusive products, you need to tell the buyer about it.

How to open a furniture store?

As for the search for funds for the launch, it is better not to count on state support. Today in Russia, first of all, they support manufacturers and agribusiness. It is believed that trade is already sufficiently developed and organized, so this industry is not subsidized. There remains hope only for banks that participate in programs supporting small and medium-sized businesses. They are at acceptable interest loans to the business.

Farid Safin, General Director (founder) of the group of companies «Your life»

But there are nuances. Based on personal experience, I can say that all banks require a deposit – a room, an apartment, a car. At the same time, today the direction of furniture trade is considered a risky business. Recently we wanted to take out a loan, it seemed like the bank was happy with everything, but we were later told that the furniture business was risky, and they refused to take a loan. Therefore, not everything is so simple. It is better to find an investor, partners who are ready to invest in business and develop together.

What are the current costs of the business? You need to have a warehouse stock of furniture, rent and maintain warehouses, where loaders work on the acceptance and release of furniture, storekeepers. Now computerized accounting systems, so we need programmers. Plus transportation costs, including the delivery of furniture from the manufacturer – from factories and plants.

How to optimize costs? You can translate something into outsourcing – for example, the services of programmers, warehouses to rent with a ready staff of movers or even work with «wheels» – to take furniture directly from the factory and immediately deliver to customers. The advantage of small businesses is that they do not need to maintain a large office staff: dispatchers, commercial service, accounting, management. Many entrepreneurs at the initial stage perform all these functions themselves – he and the forwarder, and the manager, and the dispatcher, and the accountant. But as you grow, it’s better not to inflate staff, this will allow you to optimize costs.

On average, the current expenditure of the furniture salon at the initial stage, with a minimum number of maintenance personnel, is 100-150 thousand rubles a month. But this amount does not include rent – it depends on the area. In large Russian cities on average – from 800 to 1500 rubles per square meter.

Step-by-step instruction

In your activity, you will have to interact with a number of counterparties and suppliers. First of all, they are furniture manufacturers. You can go directly to them. But when the volume of sales is small, it is difficult, because manufacturers are interested in large orders. Therefore, small companies are easier to work with dealers, wholesale sellers.

In our company there is a wholesale department. We bring furniture from all over Russia, as well as from China, from Byelorussia, from the Baltic States and we release from our central warehouse small lots for small entrepreneurs – they take the assortment they need. For beginners it is convenient, the more they can take into account our trading experience, because we know in which region what furniture is in demand, and we give our recommendations.

Also you will need to cooperate with transport companies, cargo carriers. They bring furniture, including from abroad, and take on all the relations with the customs, eliminating the unnecessary work of furniture sellers. It is also important to prepare sellers. Training them are engaged in various training companies, coaches.

Promoting a company is an ongoing process. If you want to be recognized, that her name be heard, you have to invest a lot in advertising. Suitable information channels – television, radio, newspapers and magazines.

Now let’s talk about the staff. In the cabin there must be at least two sellers, so that they can replace each other. The larger the salon area, the more sellers need. The hero of our article proceeds from this calculation: on 100 sq.m. must be at least one seller.

Staff should be prepared. Sellers should be able to tell about furniture: what materials are it from, what country is exported, how it is assembled and serviced. Sellers should be to some extent designers, so that, for example, based on whether the client’s apartment is on the sunny or shady side, help him pick furniture that decorates the interior. Today, a huge number of different models are presented in different shopping centers. The buyer is basically not prepared and, having come to the salon, can not immediately decide what he needs. And then the degree of readiness of the seller is of great importance, so that he can understand what the client needs, and offer exactly those models that will be useful to him.

If a person once bought furniture in one network and remained completely satisfied with the quality and price, the next time he tries to contact the same store. Between the seller and the buyer there is a link that is maintained for years. In our network there are regular customers who buy furniture from us for many years and bring their children.

The main quality for the seller is the desire to work. If a person thinks that the furniture will sell itself, but he can sit on the couch and read, waiting for the buyer himself to come up and make an order, then you do not need it. Today there is a wide selection of furniture in different salons. And the seller should be interested in the buyer. Most often after 2-3 months of internship a person develops assortment and can already deal with sales quite well. In developed companies, there is a staff service that recruits and trains personnel.

We try to ensure that people work in our company steadily, constantly. This is what happens. Most of our employees work, if not from the day the company was founded, then on average 10-15 years. To do this, we constantly use the motivation system and periodically revise it so that it is attractive to our employees. We have a 13th salary, a trade union organization that maintains links with many institutions – for example, sanatoria, and you can get preferential vouchers. People can get vacation, sick leave. We organize corporate parties – and New Year’s holidays, and March 8, and May 1. In the New Year we sum up the work and announce the best workers, give gifts and certificates of honor.

In shopping centers you will be forced to adhere to the established schedule of work. In stand-alone salons, be guided by the regime that is acceptable for this or that district of the city.

A place

It is more advantageous to open in the place where many people live, in a place with good traffic. This may be a sleeping area, but it is important that the store can be seen from the roadway. Advertising is expensive, so if you make a good sign visible from the road, it will attract customers.

The more your trading floor will be, the higher the ceilings should be, so that there is no feeling of compression. In any case – not less than three meters. There are no special recommendations on the layout of the premises. It is important to create passages between the furniture so that a person can move around and inspect the entire exposition. Also, there should be sufficient illumination so that you can view all the details.

If you have a small store, you can decorate it in the form of an apartment. If the area is large, it is better to arrange furniture by type – a series of bedroom sets, cabinet furniture, kitchens, upholstered furniture.

Under the trade of furniture, there are no special requirements for fire safety. Of course, there should be a system of centralized firefighting. If the area is large, then – automatic fire extinguishing. Passages should not be blocked, so that people can be easily evacuated. In the rest the requirements are standard.

Documentation

Special permissions do not need to be received. We need hygienic certificates for quality, but they are usually supplied by the manufacturer.

At present, there are two main types of taxation, which are used by entrepreneurs engaged in retail trade – the Unified Tax on imputed income and the simplified taxation system. UTII accrued depending on the area. «Simplified» depends on the turnover, that is, the tax is paid depending on how much the goods are sold. And the choice of the type of taxation depends on the patency of the outlet. There are retail outlets with high traffic, there is a high rent, but also a return on sq.m. the turnover is also high. In this case, it is better to pay UTII. If the areas are large, but the patency is low, the rent is low – here the simplified system works better.

Check-list of opening

  • The analysis of the market and competitors (assortment, prices, demand, personnel, etc.),
  • Choosing a niche,
  • Search for a room,
  • Evaluation of the rental location, the choice of the best option,
  • Conclusion of the lease agreement,
  • Registration of IP or LLC, registration with the tax inspection,
  • Search for colleagues,
  • Interviewing, selection of candidates,
  • Employee training,
  • Scheduling shifts,
  • Making a loan (if necessary),
  • Concluding an agreement with suppliers and ordering furniture,
  • Repair work (if necessary) and decoration of the salon,
  • Development of an advertising campaign for the opening,
  • Development and coordination of the signboard, its installation,
  • Development of shares, discounts and other marketing activities,
  • Festive opening.

Opening a store in a detached building must be highlighted as an event. If the store is designed for the scale of the district, it is necessary that its residents learn about the opening. Usually when you open a store create a beautiful furniture exhibition, hang balls at the entrance, attract animators who will meet and entertain guests, children. Without gifts, such events can not be avoided – even if they are small, so that when they come home, people tell about their store to their family and neighbors.

Is it profitable to open

Calculating the cost of furniture in your cabin, you need to consider the purchase price and your current costs. Costs are formed based on transportation costs, rental costs, service, delivery, assembly, current costs for staff maintenance, salaries. You need to take into account taxes. The average mark-up is about 50%. Although there are models for which 100% or more are assessed, but it is expensive furniture that is sold rarely and can stand in the cabin for up to three months until it is bought. On furniture, which is sold quickly, there may be a markup of 20-30%.

During the actions, sometimes a discount of up to 50% on certain models is made. We will admit, furniture cost 100 units, it was assessed up to 150, and at a discount it will be sold at 75 – below the incoming price. This is done specifically to quickly sell off the goods and put money into circulation for purchasing the following models.
Exit to the point of «zero» depends on many factors: how successful a businessman was able to pick up samples, arrange an exposition, conduct an advertising campaign, and also how effectively he can sell. Therefore, you can go «to zero» and a month later – if the sales went and the furniture is in demand. And you can work out a year and be in the red.

For any entrepreneur, the main goal of doing business is to make a profit. Therefore, every entrepreneur uses every opportunity to build a job effectively. But much depends also on external factors – from the state of the market, the economic situation in the country.

The furniture business is influenced by the seasonality factor. The rise in demand begins at the end of summer and lasts until the end of December. After the New Year there is a decline. In late May – early summer sales are very small. At this time, when no measures help to raise sales, it is better to let workers go on vacation, so that they can rest, do repair work, create new brands, restore old ones. There is time to prepare for the season.

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