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HELP 'I have £62k for first business...'

Discussion in 'General Business Forum' started by esco, Jun 5, 2010.

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  1. mitch@volume

    [email protected] UKBF Regular Free Member

    212 35
    you're 25 and have saved £60k in the bank! i would say get another job doing what ever it was you were up to before.

    I know somebody who owns a news agents, does very well for himself but works every hour under the sun to run it. up at three thirty to prep sandwiches & receive papers, then runs to the cash and carry for stock & what ever else in the afternoons and him or the wife covering the counter all day 8am open to 8pm close. :(
     
    Posted: Jun 5, 2010 By: [email protected] Member since: Oct 14, 2008
    #61
  2. QuickHomeBuyers

    QuickHomeBuyers UKBF Ace Full Member

    2,217 198

    That actually is hardwork.
     
    Posted: Jun 5, 2010 By: QuickHomeBuyers Member since: Jan 9, 2010
    #62
  3. adventurelife

    adventurelife UKBF Ace Full Member

    2,040 620
    Your points are very good. £60k savings by 25 is exceptional I missed that on the OP's post.

    We have 2 shops in our village both owners do what you have described. To me a business is not a business unless it can afford to employ people to do the doing and the owner works on the business not in it. Any other way and to me it is a job.

    However, I do respect those that do those sort of hours for little return.
     
    Posted: Jun 6, 2010 By: adventurelife Member since: Dec 2, 2007
    #63
  4. oldeagleeye

    oldeagleeye UKBF Newcomer Free Member

    3,987 1,220
    I haven't read all the posts but I get the general gist and I think a reality check is needed here. First the concept itself of building up a chain of retail shops. I did that in the 1960s - 1970s and ended up with 6. All were successful but only for 3 reasons.

    I) was already pretty damn good at marketing having cut my teeth in selling unit trust investment plans door to door and in most unlikely location you could imagine. The huge council estate a Basildon.

    2) I saw a huge gap in the market and took the time to research the market thoroughly and then some. There was no Internet then and my business plan represented a major new initiative so there was no other way of testing it's viability other than to go and work as a manager in someone else's business. Incidentally. This company had over retails 300 stores and within three months I was always one of the top 3 performing managers for the next nine months. I mention this not to blow my own trumpet but to emphasise the point that I already had the skills in place to to be a successful player in that business sector when I opened my 1st store.

    Without them. Without hands management of the first store I would have failed. I have no doubt about that whatsoever.

    3) The 3rd contributing factor was that my business enjoyed high profit margins with GP @ around 45%. The bottom line here then is that I had all the fundamentals in place to expand and I did.

    Now as many members in the forum will know I like to put any advice that I give into a real life context because I believe that is extremely helpful to most people - although a few idiots on here think I am just ranting. As if I care what they think. There is an important lesson to be learned here.

    Unless you have a fortine you can't build up a chain of retails stores without hands-on management and if you do - be warned. Growth is not always the magical panacea to riches it is supposed to be. All to often it means working 16 hrs and 7 days a week.

    The result as did happen to me and many of my peers family life breaks down and ends in a costly divorce. 15 years of hard work and for what. As well as the family the house has gone , For what. By the time I paid managers I was not really any better off financially anyway than when I had just the one store. That is the experience then. 1 well run store especially family managed can be more profitable than 6 outlets.

    Now lets look at the OP's situation.

    For a start he has no experience in running a retail store and thinks it can't be that hard. My father ws a newsagent for over 30 years and every day of every week apart from the odd holiday he was up a 5 am ready to mark-up the papers - that alone took 2 hrs. 1 of the papers boys doesn't turn up - he had to do it and on top of all that there is till dicipline & stock control and I gurantee you OP you will suffer losses. You can't leave a business like that to run itself then.

    Corner grocery store . Sub Post Offices & Newsagents. Bad - bad news anyway if you forgive the pun. High capital outlay and yet low profit margin's. So low in fact that unless your a major PLC like Martin's there are no net profits. There is at best a living to be made by a husband & wife team.

    Bad - bad news for grocery stores. Tesco & Sainsbury opening up almost a 1000 more 8 -10pm mini-stores in local neighbourhoods. Bad - bad news for newsagents. 1,000's more are giving up smoking every week. All promotion of the weed to cease and those that do want to by won't be able to see any special offers as fags will be forced under the counter. More bad news. Apart from a few redtops most newspapers are struggling.

    So what's going to be left to generate income. A dozen of so school kids coming in every day picking their noses while deciding which penny sweets to buy - and I am not kidding. The Asian lady that runs my local newsagents along with her hubby have taken to wear surgical gloves since they took over.:eek:

    The logistics aside. We are talking here about 2 types of business in decline. I wouldn't invest in one such business let alone think of building up a chain.

    As for the village sub post office. Again far too risky in my opinion. Mandy changed his mind twice about closing most of the down and now the Gov are toying with the idea of selling off part of the Royal Mail. What next. If not closing most of then all down a review of the quite generous salaries paid to sub post offices for simply swiping a pension card and dishing out the cash has to be on the cards. That could be done by a hole in the wall at no cost whatsoever the the Gov.

    Sorry OP but I think your business plan to go into retail and especially those shops a no brainer.
     
    Last edited: Jun 6, 2010
    Posted: Jun 6, 2010 By: oldeagleeye Member since: Jul 16, 2008
    #64
  5. QuickHomeBuyers

    QuickHomeBuyers UKBF Ace Full Member

    2,217 198
    Please recommend OP a business which is viable for £62k price.
     
    Posted: Jun 6, 2010 By: QuickHomeBuyers Member since: Jan 9, 2010
    #65
  6. sysops

    sysops UKBF Newcomer Free Member

    2,923 887
    If anyone has some of these @£62k, I'll take 10 please.
     
    Posted: Jun 6, 2010 By: sysops Member since: Feb 1, 2007
    #66
  7. Psl

    Psl UKBF Ace Free Member

    2,536 619
    Esco, take a look at the URL in my sig. 10K - 20k opportunity with proven returns in the range you looking for.
     
    Posted: Jun 6, 2010 By: Psl Member since: May 4, 2010
    #67
  8. adventurelife

    adventurelife UKBF Ace Full Member

    2,040 620
    OP

    You also have to decide is it all about the money? Is that the only reason you want to go into business. If it is you need to look at other businesses with much higher profit potential.

    Or do you want to run a business that makes money but is also in a sector you enjoy or have skills in?

    Many business owners strike a balance on the above, as at the end of the end of the day you have to enjoy each day, to many spend their life chasing the dream instead of living it:)
     
    Posted: Jun 6, 2010 By: adventurelife Member since: Dec 2, 2007
    #68
  9. esco

    esco UKBF Contributor Free Member

    81 1
    I agree this has the most desirable figures, but I have concerns over the lease also. It is council owned so would this cause further probs, in that are the council stricter re lease renewals?
     
    Posted: Jun 6, 2010 By: esco Member since: Jun 5, 2010
    #69
  10. QuickHomeBuyers

    QuickHomeBuyers UKBF Ace Full Member

    2,217 198
    Your best bet is to check the lease and your rights to renew upon expiry.
     
    Posted: Jun 6, 2010 By: QuickHomeBuyers Member since: Jan 9, 2010
    #70
  11. esco

    esco UKBF Contributor Free Member

    81 1
    Tbh it is primarily about the money at this stage of my business career. I am looking for a pretty secure £25k a year net profit making business to allow me to open up another business hopefully after a couple of years, maybe less.

    What business' do you suggest I consider that offer much higher profit potential, bearing in mind I have little ACTUAL business exp.
     
    Posted: Jun 6, 2010 By: esco Member since: Jun 5, 2010
    #71
  12. esco

    esco UKBF Contributor Free Member

    81 1
    Thanks for the post. :)

    At this stage I am not certain as to what industry I will go into, but if not retail what do you suggest? I am not really looking for a long term business, if say I bought/leased a coffee shop, if I could get 3-4 years good business from it, I'd be happy than sell lease if coffee suddenly goes out of fashion (obv depending on how many years remaining etc).

    Even though I have £62k in bank, the way I see it is if I was to buy into a slightly more expensive business than what I have, say up to £80k, and to pay proportion of buying price with profits from business, this is also a good option for me.
     
    Posted: Jun 6, 2010 By: esco Member since: Jun 5, 2010
    #72
  13. esco

    esco UKBF Contributor Free Member

    81 1
    I used to work in offices. I've had enough of that life. I need to take a diff path in life now
     
    Posted: Jun 6, 2010 By: esco Member since: Jun 5, 2010
    #73
  14. Lee Jones Jnr

    Lee Jones Jnr UKBF Newcomer Free Member

    3,751 736
    So now it also has to be short term?
    If you are happy earning 25k then why not just get a job and save yourself the hassle?
     
    Posted: Jun 6, 2010 By: Lee Jones Jnr Member since: Dec 6, 2009
    #74
  15. esco

    esco UKBF Contributor Free Member

    81 1
    I never said it HAS to be short term.

    I was merely trying to make the point if I was to buy say a post office, and than after a few years the government wanted to close them down, I would be ok with having a few years good business from it in the meantime.

    I.e the industry I go into for my initial business doesn't have to be a brand new and massively expanding industry. But obv if it is, than even better.
     
    Posted: Jun 6, 2010 By: esco Member since: Jun 5, 2010
    #75
  16. Arsh4d

    Arsh4d UKBF Newcomer Free Member

    95 4
    If you have the selling skills then become a car trader.

    Buy/sell used cars.

    Invest around £10k of your money and buy a few cars in the region of £3k each, and tidy them up and sell them up for a small profit.

    If you can make sell 2/3 cars per month for a profit of £500 each, then you will be well on the way to making some good money.

    This way it doesn't take up all your time, and you don't need additional staff.
     
    Posted: Jun 6, 2010 By: Arsh4d Member since: Sep 22, 2008
    #76
  17. esco

    esco UKBF Contributor Free Member

    81 1
    My dad suggested this to me, but tbh I'm not really a natural seller and its something I would have issues over......otherwise I would have gone down this road already. Sales is not my thing at all.
     
    Posted: Jun 6, 2010 By: esco Member since: Jun 5, 2010
    #77
  18. Lee Jones Jnr

    Lee Jones Jnr UKBF Newcomer Free Member

    3,751 736
    Oh my word!

    I promise you that I mean no malice but I really think the best thing for you to do is get a job.
     
    Posted: Jun 6, 2010 By: Lee Jones Jnr Member since: Dec 6, 2009
    #78
  19. esco

    esco UKBF Contributor Free Member

    81 1
    Thanks for the advice, but no thanks......I'm not going back into employment.

    I want to start up a small business. I don't want to be a sales person. There's plenty of other business opportunities for me.
     
    Posted: Jun 6, 2010 By: esco Member since: Jun 5, 2010
    #79
  20. oldeagleeye

    oldeagleeye UKBF Newcomer Free Member

    3,987 1,220
    May I ask what area you live in. If it is in a part of the country not covered already by our business plans I might be able to offer you an opportunity. Less capital investment and a greater return.

    Please note. be assured I did not have this in mind when I made my post about retail. That quite franjly is not my style because I believe that trust is everything in business.

    Robert
     
    Posted: Jun 6, 2010 By: oldeagleeye Member since: Jul 16, 2008
    #80
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