Serious Sweet Shop Question

[Jprandss]

Hello all!

I have been offered the lease on a great location shop, in arguably the busiest coastal town in Cornwall. It is very wealthy. Year round trade centered around a heaving summer. I already have a shop in this town and we do very well.

The sweet shop in town recently closed through illness/retirement and I am thinking of turning this new shop into a sweet shop. My business is related but I don't know sweet shops specifically.

The questions I have for those that know are:

What is the typical margin on bagged sweets?
Do manufacturers pre bag them, ready for your sticker to be applied?
What is the maximum number of staff needed per day in a busy sweet shop, of approx 20sqm?
Would sweets cover sales for a rent of approx £35k + rates? I am assuming I need to be turning over £200 to 300k to make a decent profit.
Would sweets cover a fully staffed shop?
What is the typical customer spend in sweets, in a wealthy tourist location?

Thanks in advance, hopefully I'll get some replies and I can ask further Q's.

 

[onlyforward]

I would advise you to not open a sweets shop. There is simply not enough demand. If you are going to open a sweets business, start online. £35k rent + rates and other costs is far too risky.

 

[Ian J]

If you are going to open a sweets business, start online.

I would have thought that sweets were impulse buys which makes a physical shop more appealing than the internet

 

[onlyforward]

I would have thought that sweets were impulse buys which makes a physical shop more appealing than the internet

I previously owned a sweet shop so I speak from experience. Of course not all experiences are the same. My only attempt here is to prevent OP from losing their money when there are plenty of other business options. It's definitely an impulse buy but impulse won't be enough to turn a profit. Yes, you'll get SOME customers, most of which will be children dragging in their parents spending £2-4. The other group will be school kids popping by after school who will spend £1-2. At 35k + 15k (rates) that's 4K a month and we haven't even touched on utilities, marketing, signage, stock and staff. You'll easily spend 100k in your first year.

OP should do research on the online sweets market in the UK first and start there. Don't throw away your money.

 

[Jprandss]

I would advise you to not open a sweets shop. There is simply not enough demand. If you are going to open a sweets business, start online. £35k rent + rates and other costs is far too risky.

Thanks.
This is not a 'How to sell sweets' situation, it's more a 'I have a fantastic retail spot and am exploring ideas of what to sell' type situation.

 

[WaveJumper]

i agree with the above my son had a sweet business trading in shopping centres even with very high footfall the margins are poor you can quite easily end up being a busy fool and when you check you takings at the end of the day your wonder if it was worth it ....... he didn't and moved on to something else.

Your in the part of the country I love and I would suggest looking at something that really appeals to your target customer the tourist, ie food, coffee etc would be my first bet as they would likely still see a demand in the winter.

 

[Jprandss]

I previously owned a sweet shop so I speak from experience. Of course not all experiences are the same. My only attempt here is to prevent OP from losing their money when there are plenty of other business options. It's definitely an impulse buy but impulse won't be enough to turn a profit. Yes, you'll get SOME customers, most of which will be children dragging in their parents spending £2-4. The other group will be school kids popping by after school who will spend £1-2. At 35k + 15k (rates) that's 4K a month and we haven't even touched on utilities, marketing, signage, stock and staff. You'll easily spend 100k in your first year.

OP should do research on the online sweets market in the UK first and start there. Don't throw away your money.

Thanks, I appreciate replies from those with experience.
I understand the overheads on this site and am trying to fill in the blank of how much I could feasibly take per day or year.
Again this is a fabulous spot and has a huge footfall buying presents to bring back from holiday. My other comparable business in the town has similar costs (although slightly less) and we make a very large profit, it is a fully staffed shop with a manager in place.
But it isn't sweets and maybe I'm overestimating demand/average spend.

 

[Jprandss]

i agree with the above my son had a sweet business trading in shopping centres even with very high footfall the margins are poor you can quite easily end up being a busy fool and when you check you takings at the end of the day your wonder if it was worth it ....... he didn't and moved on to something else.

Your in the part of the country I love and I would suggest looking at something that really appeals to your target customer the tourist, ie food, coffee etc would be my first bet as they would likely still see a demand in the winter.

Thanks, do you know what margins your son was seeing?
This is different to a shopping centre in that its a tourist holiday destination and people bring back gifts for family and friends.
The sweet shop in town that has closed was certainly a busy business with three staff through the summer, and operated for 20+ years. I don't know their turnover though and I have no idea of their margins.

 

[IanSuth]

Thanks, do you know what margins your son was seeing?
This is different to a shopping centre in that its a tourist holiday destination and people bring back gifts for family and friends.
The sweet shop in town that has closed was certainly a busy business with three staff through the summer, and operated for 20+ years. I don't know their turnover though and I have no idea of their margins.

I have no experience in the area.

However i would have thought the way to do it would be to have impulse items (sweets for kids) along with tourist items (cornish cream fudge / local craft beer) for taking back as gifts and some big ticket souvenirs to catch mums eye whilst in with kids (pretty bits of serpentine from the Lizard or polished granite/crystals). Key to making decent £ will be to get some local suppliers whose stuff looks good and you are selling pretty exclusively in your locals with a decent margin

 

[Fooddrinkicecream]

From someone in the seasonal business, this sounds like it has potential. What has the shop been used for? Is your current shop a food and drink offering? A turnover is not likely to be the same, and 300k seems a bit too hopeful, but margins are there and less staff/ energy are required than for food/ drink establishments.
It may be a case of trial and error to get the offering balance correct - american sweets, fresh candy floss, rock (get some made with the town name rolled in), bagged sweets, slush, pick n mix, food gift items, local produce, non food items etc.

There are manufacturers that will bag sweets, make chocolate bars etc and label for you, but I think the tourist aimed near me bags and labels their own for a higher margin.

 

[Lucan Unlordly]

What sort of shop do you currently own?

Is there sufficient distance between your existing shop and the new site to consider replicating it with another branch?

We now have two 'The Works' bookshops in town, which are just 5 minutes away from each other, selling the same stuff. Both are in precincts served by large car parks so have their own footfall.

 

[Waddy]

20sqm doesn't give you much room to diversify into other areas especially if you're envisioning 3 staff working in there. A couple of high margin, high turnover things like a slushie machine or popcorn machine could definitely be profitable in a high tourist area.

 

[MOIC]

As previously suggested, have 3 or 4 commodities, one being sweets, and expand on the commodity which sells and makes the best profit. Including local drinks & ice cream etc will increase turnover and profits.

If you’re the only shop in the street selling sweets, you may be able to increase your prices to help with profit margins.

Take a trip to Piccadilly in London to get ideas.

THE BEST 10 Candy Stores near PICCADILLY CIRCUS, LONDON W1B, UNITED KINGDOM - Last Updated July 2024 - Yelp

Best Candy Stores in Piccadilly Circus, London W1B, United Kingdom - Hardy's, Mrs Kibble's Olde Sweet Shoppe, Minamoto Kitchoan, SugarSin, M&M's World, american candy, Mr Simms Olde Sweet Shoppe, Candy Peddlers, Sweet Centre

m.yelp.com

If the shop/location is that good, find what works, especially given your experience of running a retail shop on the same street.

 

[Waddy]

If you’re the only shop in the street selling sweets, you may be able to increase your prices to help with profit margins.

Take a trip to Piccadilly in London to get ideas.

The sweet shops in Piccadilly Circus are all fronts for landlords to avoid paying business rates for empty shops.

They rent them out at ridiculously low rents on a short term lease. The ingoing business is then liable for business rates, they never pay and just fold when the council take them to court or the lease is up.

Not a good business model to follow, besides there are dozens of them and they are all astronomically expensive.

 

[MOIC]

Not a good business model to follow, besides there are dozens of them and they are all astronomically expensive.

I was referring to the products they are selling, not the actual business model. It's to get ideas of what can be sold within the sweet and allied products. Nothing more, nothing less.

 

[Jprandss]

Thanks all some interesting replies.

The shop is currently a tat/toy shop, straight from china type affair. I will find out today what they currently turnover with that, as the landlord that runs the shop wants to sell me the unsold stock...

I have a fudge shop under a franchise, it is in a line of three shops and I would be taking the remaining two shops and have the whole 'block'. The centre shop will be an ice cream company that we already own, I have a very good idea what the sales and margins are and I know we will do very well.
This leaves the shop on the far end that will be connected internally to the ice cream shop, and is the larger of the three- although will need splitting internally to have storage room for stock. Storage is a big issue although we do have a unit outside town.
So my thought is either sweets (although original q's still stand from above), or a quality toy shop as there will be a certain repeat trade from current shop- which also currently sells some sweets. I dont know anything about keeping up with toy trends or how much storage is needed. I would focus on plastic free toys.

I would either loosely copy 'Friars sweet shop Ambleside' style, or 'Junior Edition Brighton' for a toy shop.

I really enjoy the fitting out process of shops and would be doing this myself, to a very good standard although I do say so myself!

 

[Lucan Unlordly]

A trip to the NEC in Birmingham for the Autumn Fair which finishes tomorrow 7th September, might be worthwhile to get some ideas from any one of 600 exhibitors serving the fashion and gifts industry.

Lots of Toy manufacturers there I think?

 

[IanSuth]

I think local non perishable (or at least long shelf life) products would work well next to fudge and Ice cream

I know what my wife spent on Gin when we were down that was as gift for friends (several bottles of Tarquins) , I also brought back a case of Jail Ale and a case of Legend from the Princetown brewery and we drank a couple of boxes of a local lager we found in morrisons whilst we were there (Korev?). If you already have the tourists there for fudge and icecream pick their pockets for some higher margin products where your 20sqm can bring in decent £/m2

Whenever we have taken the children on holiday in the UK we have rarely bought any expensive toys, it would be top trumps or the like (travel conect4) if it was raining as something like lego or a full size board game would have to be carted home with us and risk getting bits lost.

Maybe I think we bought a jigsaw with a local theme but ONLY if a quality manufactured one.

 

[Jprandss]

I think local non perishable (or at least long shelf life) products would work well next to fudge and Ice cream

I know what my wife spent on Gin when we were down that was as gift for friends (several bottles of Tarquins) , I also brought back a case of Jail Ale and a case of Legend from the Princetown brewery and we drank a couple of boxes of a local lager we found in morrisons whilst we were there (Korev?). If you already have the tourists there for fudge and icecream pick their pockets for some higher margin products where your 20sqm can bring in decent £/m2

Whenever we have taken the children on holiday in the UK we have rarely bought any expensive toys, it would be top trumps or the like (travel conect4) if it was raining as something like lego or a full size board game would have to be carted home with us and risk getting bits lost.

Maybe I think we bought a jigsaw with a local theme but ONLY if a quality manufactured one.

Very useful input. If you bought in a Tarquins shop you may have been only metres from this spot.

I measured today and it is 57m2, a lot bigger than I anticipated. I hadn't thought about the size of toys being taken home being an issue, which is a great point.

 

[IanSuth]

Very useful input. If you bought in a Tarquins shop you may have been only metres from this spot.

I measured today and it is 57m2, a lot bigger than I anticipated. I hadn't thought about the size of toys being taken home being an issue, which is a great point.

Think she got them in Carters (was Creber's) in Tavistock rather than from distillery. We were staying nr there day tripped to many places, Polzeath, Seaton (cornish one), Princetown etc but didnt make it around to Padstow.

 

[MikeJ]

Last time I was in a proper sweet shop, there was a queue out of the door. The key here is to sell something unique, that's tied to the local area. Then you get higher margins. Local toffee or rock, stuff people will buy when on holiday.

 

[Casually made]

Low margin product , massive unit sale required just to keep the lights on , impulsive for consumers and high competition from express supermarkets and corner shops

No thanks

Stick an alcohol shop there , will do well in the recession / depression

 

[Ryan Paul]

You're in a fantastic location.
Sweet shops in Devon & Cornwall can do very well although I wouldn't restrict yourself to those items.
Would you consider adding hot beverages and ice-cream... Or also operate an morning / afternoon deli?

 

[Karimbo]

Avoid all shops. UK retail is broken. The rents and rates just kill businesses. To do well in them you have to do exceptionally good trades.

This is an interesting video: https://www.youtube.com/watch?v=GQZa57q7YpA

IMHO unless you got someone really really unique - it's not going to fly.

Mr Ps is a import only (US) sweet shop. That sells rare flavours of sweets and full sugar fanta and other drinks that people can buy to get a taste of the pre-sugar tax drinks.

Mr P's Cornershop

Mr P's Cornershop is committed to providing the best food and drink experience in your own home. Order online here at Mr P's Cornershop!

www.mrps-local.co.uk

he has social media following, and people travel there and spend £30+ on a shop. He has a bog-standard high street location and gets a lot of his customers from social media.

LOndon, in the west end it's just ridiculous.

There is no tesco express in oxford street any more - rent and rates just make it unviable for a tesco express to operate there - in a really high footfall street.

 

[Casually made]

Avoid all shops. UK retail is broken. The rents and rates just kill businesses. To do well in them you have to do exceptionally good trades.

Mr Ps is a import only (US) sweet shop. That sells rare flavours of sweets and full sugar fanta and other drinks that people can buy to get a taste of the pre-sugar tax drinks.

Mr P's Cornershop

Mr P's Cornershop is committed to providing the best food and drink experience in your own home. Order online here at Mr P's Cornershop!

www.mrps-local.co.uk

he has social media following, and people travel there and spend £30+ on a shop. He has a bog-standard high street location and gets a lot of his customers from social media.

These type of U.S shops are everywhere now , and you can get import fanta at virtually any corner shop in the UK

It was a smart idea about 6-7 years ago now its flooded and as a result the margins on products are decreasing rapidly

I've even noticed B&M now wanting a piece of the pie

You are right about the rent and rates

Last month An agent quoted me 4K a month for an out of town retail space

I laughed at him and put the phone down

 

[Paul Kelly ICHYB]

@Jprandss it's been a couple of months since you started this discussion - any updates?

 

[Karimbo]

Btl are moving onto commercial property. Expect the rent to go up and up now.

I think commercial property allows more of the mortgage payments to be written off. (perhaps all of it).

These type of U.S shops are everywhere now , and you can get import fanta at virtually any corner shop in the UK

It was a smart idea about 6-7 years ago now its flooded and as a result the margins on products are decreasing rapidly

I've even noticed B&M now wanting a piece of the pie

You are right about the rent and rates

Last month An agent quoted me 4K a month for an out of town retail space

I laughed at him and put the phone down

Thats news to me. I know of the business rates scam "American candy" shops in Oxford Street. But this is a legit all rare/unique flavour candy shop that has strong sicial media presence. Everything there is stuff you won't find in normal convenience stores.

Refreshers flavour slush puppy

 

[Jprandss]

Avoid all shops. UK retail is broken. The rents and rates just kill businesses. To do well in them you have to do exceptionally good trades.

This is an interesting video:

IMHO unless you got someone really really unique - it's not going to fly.

Mr Ps is a import only (US) sweet shop. That sells rare flavours of sweets and full sugar fanta and other drinks that people can buy to get a taste of the pre-sugar tax drinks.



he has social media following, and people travel there and spend £30+ on a shop. He has a bog-standard high street location and gets a lot of his customers from social media.

LOndon, in the west end it's just ridiculous.

There is no tesco express in oxford street any more - rent and rates just make it unviable for a tesco express to operate there - in a really high footfall street.

The video was quite interesting. But also seems odd to ask laymen a detailed question, then be surprised about their inability to guess the answer. I was surprised however at the turnover of UK branded coffee shops and would have guessed much higher.

 

[Karimbo]

The video was quite interesting. But also seems odd to ask laymen a detailed question, then be surprised about their inability to guess the answer. I was surprised however at the turnover of UK branded coffee shops and would have guessed much higher.

I'm not surprised actually. What's the average shop value in a coffee shop. Most just want a coffee and maybe 1 item.

Unlike a tesco express they don't have constant footfall of customers.

In a tesco express more often than not you'll be in a queue to pay. In a coffee shop more often than not you walk up to the counter to order your food.

It's my new favourite yt channel. Its like listening to another business owner talk about business.

 

[Jprandss]

@Jprandss it's been a couple of months since you started this discussion - any updates?

Hi Paul,

I asked a friend who owns a sweet shop in another Cornish town and he put me off the idea. He said it was possible to cover costs and make a profit, but not without selling fudge. I would not be selling fudge as I already have a fudge shop next door, and wouldn't want to compete with myself.

The shop was able to be split into two and I questioned taking the smaller side for our ice cream business, but decided against this idea as that shop only has one door. We need a door in and a door out to be able to get numbers through.

However, a few days of my deliberating and the landlord had put the shop online. It appears he got the offer he wanted on day one, £125,000 ingoing, and £65k a year rent (35k was for the half that we would have used for sweets).

Retail is absolutely not dead, there is evidently at least one company out there making a lot of money and willing to pay the above. I have a feeling it's a surf clothing brand but will find out soon enough.

I know the news will tell you that retail is dead, but it it certainly alive and well in many places throughout the country. I've got 8 shops in total and all of them make a healthy profit, as in as least double to 4x what the landlord is making.

I appreciated the feedback here, especially from those with direct experience!

 

[NaN]

The sweet shops in Piccadilly Circus are all fronts for landlords to avoid paying business rates for empty shops.

They rent them out at ridiculously low rents on a short term lease. The ingoing business is then liable for business rates, they never pay and just fold when the council take them to court or the lease is up.

Not a good business model to follow, besides there are dozens of them and they are all astronomically expensive.

I was told those are all fronts for cartels to launder their money.

Edit: I'm sorry I revived this old post, Google brought me here and I thought this was one of the fresh posts I had opened in my tabs.