Starting a baby, toddler, children's clothes shop.

Flyingtempo3

I am looking to start this business in my local town has population of 6000, with Dunnes and Tescos as the only other stores providing competition to this business.
Would be great to talk to people who could give me advice, especially people in this field would be great.
Looking for advice on all aspects from rent and rates to wholesalers. How much of a turnover would be needed to survive I know this is all best guess but it might give me some idea of what has to be done and if it's viable. Any advice wether good or bad would gratefully accepted. Thanks

pedronomix

Only Dunnes and Tesco? They will sell at about 20-30% below your best cost price, retail is littered with such failed business opportunity notions!!

pebbles21

You don't want to go down that road,believe me, I've learnt the hard way..pm me if you want some advice regardless

Flyingtempo3

pedronomix wrote: »

Only Dunnes and Tesco? They will sell at about 20-30% below your best cost price, retail is littered with such failed business opportunity notions!!

I know only Tesco and dunnes as competitors sounds stupid 2 of the biggest retailers in the country.

But there really is a lack of baby and children's clothes in both stores. Dunnes is handy for getting bits and pieces but whenever we have to get some decent clothes for our kids we have to travel to get any sort of decent clothes that will last

pedronomix

if they dont have a good kids selection, then they wont have a decent adult offering. So punter goes to big town for adult and kids well priced clothing......

StupidLikeAFox

Hey OP, don't be displayed heartened by the comments here. As you say, there are more than likely people who want quality kids clothing and would be willing to pay that little bit extra (you won't be able to beat them on price!)

This story was on the journal a few weeks ago which might be applicable to your situation:
http://businessetc.thejournal.ie/rock-frocks-ireland-1801013-Nov2014/

StupidLikeAFox

StupidLikeAFox wrote: »

Hey OP, don't be displayed heartened by the comments here. As you say, there are more than likely people who want quality kids clothing and would be willing to pay that little bit extra (you won't be able to beat them on price!)

This story was on the journal a few weeks ago which might be applicable to your situation:
http://businessetc.thejournal.ie/rock-frocks-ireland-1801013-Nov2014/

Pretty niche business in fairness Foxy. You reckon the OP would have international customers coming for their unique designs of baby clothes? Probably not. The niche of that 6000 people that would travel further afield would be how many people? How many babies are in that 6000 in the first place.

Small market, smaller niche, high risk!

ladiesman217

Hi Flyingtempo3. Retail is a hard one but with the right customer experience you "WILL" do well. What you don't want be is a shop that just sells clothes, they are ten a penny. Think about creating an experience when shopping in your shop, craft your brand around a fun experience for kids to buy clothes. People pay a little extra for a well run service. Also have consistency with your brand .e.g get your logo mark on your bags. Its amazing to see how many small businesses don't have there logo mark on their bags, when you are getting free advertisement, people walking around the town with your bags.
I was recently was shopping for toys in one of Irelands largest toy store chains. And what I found is that there was a complete lack of any thought out customer experience, no people dressed up, no interaction with the kids or parents. Its just a large warehouse that sells toys. Sometimes it not what you sell, its how you sell it. Also think about online sales, can be easy enough to set up e-commerce site. pm me if you need a further details. Happy new year

Mrs OBumble

Flyingtempo3 wrote: »

my local town has population of 6000,

Irrelevant. The might all be old people!

What's the number of families with children in your target age group?

What's the population turnover like, ie will there be other families with pre-school children in 5 years time, or is it a very settled area with a post-recession baby boom?

Hint: 6000 doesn't sound like enough to sustain both Dunnes and Tesco. Think about the shopping catchment area, rather than just the town.


How will you be different from Dunnes and Tesco? How much will you have to invest in stock to provide that difference?

pedroeibar1

ladiesman217 wrote: »

Hi Flyingtempo3. Retail is a hard one but with the right customer experience you "WILL" do well. What you don't want be is a shop that just sells clothes, they are ten a penny. Think about creating an experience when shopping in your shop, craft your brand around a fun experience for kids to buy clothes. People pay a little extra for a well run service. Also have consistency with your brand .e.g get your logo mark on your bags. Its amazing to see how many small businesses don't have there logo mark on their bags, when you are getting free advertisement, people walking around the town with your bags.
I was recently was shopping for toys in one of Irelands largest toy store chains. And what I found is that there was a complete lack of any thought out customer experience, no people dressed up, no interaction with the kids or parents. Its just a large warehouse that sells toys. Sometimes it not what you sell, its how you sell it. Also think about online sales, can be easy enough to set up e-commerce site. pm me if you need a further details. Happy new year

Poor advice as it ignores the fundamentals. For a town with a 6k population, the demographical average would indicate a 0-6yrs population of about 6%, or 360 individuals. In “new towns” it would be higher due to the higher number of young parents, but they are not big spenders. Even if every infant/toddler in the town had €50 spent on it annually in OP’s shop, that’s a t/o of €180k. And OP intends to compete with Dunnes & Tesco? Clearly it is not going to work; online does not need highstreet premises, totally different business model.

ladiesman217

pedroeibar1 wrote: »

Poor advice as it ignores the fundamentals. For a town with a 6k population, the demographical average would indicate a 0-6yrs population of about 6%, or 360 individuals. In “new towns” it would be higher due to the higher number of young parents, but they are not big spenders. Even if every infant/toddler in the town had €50 spent on it annually in OP’s shop, that’s a t/o of €180k. And OP intends to compete with Dunnes & Tesco? Clearly it is not going to work; online does not need highstreet premises, totally different business model.

Hi. The angle of response I was giving was from a customer experience POV. The advice is equally fundamental and adds to the overall body of advice in response to the question.

daviecronin

Hi OP,

I like your idea but I would like to give a bit of advice. My town/area has over 12,000 people and we don't have a shop dedicated to baby clothes etc. And too be honest this town is thriving with young families in massive housing estates. Maybe if you look at it as a more 'up-market' boutique style you could attract people from miles away. Would your town be considered 'posher' or more of a kip. Maybe its a tourist type town and people might stop at your shop for an impulse buy for a young relative?

jimmii

You would need a lot of online demand to make that work there by the sounds of it. A shop doing similar to what you are suggesting opened up across the road from us in the city centre a few months ago and it looks like they have already given up. For a small shop with say two staff to be making much for yourself you are probably looking at needing to turnover €300k+ unless you have very high margins. I would advise you to seek out somewhere with a higher potential footfall its better to travel to the right location than just find somewhere convenient for where you live.

Meritor

Though I am not a good entrepreneur, I have my opinion to share..

Lots of points to consider here...

pedroeibar1 wrote: »

Poor advice as it ignores the fundamentals. For a town with a 6k population, the demographical average would indicate a 0-6yrs population of about 6%, or 360 individuals. In “new towns” it would be higher due to the higher number of young parents, but they are not big spenders. Even if every infant/toddler in the town had €50 spent on it annually in OP’s shop, that’s a t/o of €180k. And OP intends to compete with Dunnes & Tesco? Clearly it is not going to work; online does not need highstreet premises, totally different business model.

I somewhat agree with pedroeibar1.
However, considering the fact Tesco and Dunnes are there, there must be another set of customer they must be targeting - small villages/town nearby.

pedroeibar1 wrote: »

And OP intends to compete with Dunnes & Tesco?

To support OP:
I assume that OP intends to focus on business and have no plan to compete with these two giants. As OP mentioned earlier, the business focus will be on different type of clothes, toys that are NOT available in Tesco,Dunnes.

However, one question:
Why Tesco/Dunnes are not keeping the good range of your target products? Is it they are not getting enough customers or it is they are happy with other items and not targeting these products?

As ladiesman217 said, selling skills and customer relationship matters in small town.

The only thing that I am worried about is annual turnover and % you will earn out of it. I hope you have already put this on paper and calculated your expected return after deducting all the expenses.
And if you are happy with whatever you get, I will strongly say go ahead with it. (though these are not the only thing you need to consider)

A good marketing is another aspect. I have seen people going to specific shop in another town just because they have good offering.

One most important aspect of startup is backup plan...
You must have plan B/C/D...Z ready if things do not work as per your expectation...

pedroeibar1

Meritor wrote: »

Though I am not a good entrepreneur, I have my opinion to share..

Lots of points to consider here...



I somewhat agree with pedroeibar1.
However, considering the fact Tesco and Dunnes are there, there must be another set of customer they must be targeting - small villages/town nearby.


To support OP:
I assume that OP intends to focus on business and have no plan to compete with these two giants. As OP mentioned earlier, the business focus will be on different type of clothes, toys that are NOT available in Tesco,Dunnes.

However, one question:
Why Tesco/Dunnes are not keeping the good range of your target products? Is it they are not getting enough customers or it is they are happy with other items and not targeting these products?

As ladiesman217 said, selling skills and customer relationship matters in small town.

The only thing that I am worried about is annual turnover and % you will earn out of it. I hope you have already put this on paper and calculated your expected return after deducting all the expenses.
And if you are happy with whatever you get, I will strongly say go ahead with it. (though these are not the only thing you need to consider)

A good marketing is another aspect. I have seen people going to specific shop in another town just because they have good offering.

One most important aspect of startup is backup plan...
You must have plan B/C/D...Z ready if things do not work as per your expectation...

Forget “selling skills” – if those are not there the person has no business in retail.
Forget “customer experience” - it is a BS distraction when there are few potential customers in a town of 6k people. Customers will drive to Tesco/Dunnes/Aldi/Lidl because they can ‘do the shopping’, buy a range of products and throw in a few bits of clothing. They are not going to drive miles from the hinterland to buy a fancy sleeper suit/Babygro/toy.

Just keep it real simple. Look at the FACTS –
Minimum for rates, rent, light/heat and insurance = €30,000
Minimum wage plus employment taxes plus a bit for part-timers €70,000 = Overhead costs of €100k
Purchases of €250k with a (low) mark-up of 40% on cost = gross profit of €100k = turnover of €350k p.a.

So that’s nearly seven grand a week – on babywear! Out of a small town (one the size of Birr, or Westport, or Carrick-on-Suir or Kells.) Out of a tiny segment of a small niche sector. Out of a town that already has a Tesco and Dunnes. I’d bet that their combined sales annually of infant/toddler wear in that town is considerably less than €350k. As I said in an earlier post, there are about 360 end-users. Are grannies/granddads/loving relatives going to lavish a grand on each of these kids annually?

Plan b, c or d are not realistic options. No wonder the OP has moved on!

Flyingtempo3

Sorry pedroibar1 haven't gone anywhere have been taking note of everything that's been said.
I have been doing some work to see if this is a viable business venture. Some positives and some negatives.
As I said from the beginning I want to hear all views good and bad. Although I'm not definitely going ahead with this for definate, from the research I have currently done this could work.

I know it's not going to be easy but the figures I currently have are a fair bit different from your estimates.

I have also spoken to a retailer who is in the line of business I want to get into and making it work and has given me some great advice so far.
So it's not all the doom and gloom you portray that's not to say as with any business that this will definaty workout.
I do thank you for your comment and hope I can prove you wrong.

pedronomix

It will not impact on anyone on here whether you succeed or not, only you. The basic commercial demographics are stacked hugely against you.
However if you are a well experienced operator in this particular field, have the money to fund it and have that special entrepreneurial pizazz, you could make a huge success out of it. It is a lonely place where only you can make that call.

Flyingtempo3

Flyingtempo3 wrote: »

I do thank you for your comment and hope I can prove you wrong.

Its all well and good using negative comments to motivate you etc, but Pedro is spot on, he just put more time and detail into what I said in a couple of lines. He has done you a big favour as opposed to the other positive -with respect- nonsense, from numbers that clearly don't and will not work. Im a very positive person but I take one look at your proposal and say it has a 1 in 100 chance of working if that. If it was to tick over it would be very tough and high stress.

Business is hard enough without starting with negative odds of succeeding. The numbers just don't stack up! Put your motivation and skills into something that is odds on to succeed, that doesn't need minor miracles. Give yourself the best chance to succeed.

Happy for you to post numbers, if you think it can indeed work, and happy to eat humble pie if they stack up.

jimmii

We started a retail business two years ago if I could go back and tell myself anything it would be wtf are you doing! I was in retail management for years but its a whole different ball game and a whole lot harder than it seems. The only reason we got through was due to being bloody lucky. The footfall going by our door is about 1k a day which sounds like a lot but its not I dread to think what it would be like in a town of 6k you might only get a hundred or so people going by.

sconhome

Hi flyingtempo3, some pretty good advice given so far, but can I suggest something to you?

There is a kids clothes shop opened beside me less than a year ago in a village with a demographic not too unlike your's. There is a Tesco nearby and a Dunnes and it would be really worth your while having a chat with the owner / manager.

PM me if you would like their contact info.

I would listen to the advice about the demographics because unless you have a kickass website with some awesome customer experience it is going to be very very hard to get the level of business that you need to survive. The majority of people are driven by price first and quality second. It doesn't matter how good your products are or how excellent your service is, if you don't get people in the door they will never find out.

Barrysham

Hi Guys.
Very interested in this thread as recently myself and my wife went shopping for a new travell system. I was just wondering had the original op intended to just sell clothes or were they also going to sell car baby seats, push chairs, cots etc.
I live in a town with a population of over 8000 people. 40 minute drive to the closest City. No Dunnes or Tesco in my town.
In the city there's mothercare, Smyths and as far as I'm aware only one other shop which specialises in selling the items I've mentioned above.
It crossed my mind about opening a shop in my town selling these products as I found the selection in the shops I was in weren't great.
Just an idea that's all......

pedroeibar1

Flyingtempo3 wrote: »

Sorry pedroibar1 haven't gone anywhere have been taking note of everything that's been said.
I have been doing some work to see if this is a viable business venture. ......
So it's not all the doom and gloom you portray that's not to say as with any business that this will definaty workout. ......I do thank you for your comment and hope I can prove you wrong.

Hi OP,
You don’t have to prove me wrong, OP, you have to prove yourself right. There’s a big difference.;)

As the Yanks, say, I’ve no dog in this fight, I simply look at some posts and if I’m bored and know about the topic I will post a comment if I think ‘Hey, that’s good! or “That’s baad” or “What gobs#1te would suggest ‘advice’ like that?”

You really need to look at the risk : reward ratio – why invest your savings and bust a gut for a couple of hundred customers when your input (investments of time/cash/effort) would be the same and reward greater in a different, bigger location? Also, do not confuse footfall with customers. There was a babyshop opposite the exit to Tesco in Bloomfield’s SC in Dun Laoghaire – opposite the checkouts! – and it is gone. There were others elsewhere in the town doing exactly what you want to do and they are gone (and they started/folded in the Tiger.)

I don’t have UTD failure figures for your sector, but as a rule of thumb a third of specialist clothing retailers are gone by end year two, more than a half by end year three. More than half of the failures are due to managerial incompetence, and another third is due to lack of experience.

If you post figures – even back of an envelope ones on CASHFLOW – it would be clearer.