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You’ve decide to open a sporting goods store. Great! But where to start? There are a number of factors you need to take into consideration when getting your business off the ground, and we’ll take you through all of them step-by-step.
Steps
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Study the market. Before you can open your own sport goods store, it’s important to know what your competition is like and what kind of need there is for another (or a different kind of) store.
- Pay a visit to the other sporting goods stores already in the area you think you might want to open your shop, and see what sports or hobbies they cover particularly well and not so well.
- If there is an under-represented sport that you think still has an interested consumer base, consider catering to them. This might be an opening for you to capture the market.
- Stay current with new trends and up-and-coming sports, such as at-home circuit training or extreme outdoor sports, which might introduce new demands or equipment into the market. [1] X Research source
- Be aware, though, that if there is no one covering a certain sport or market, it might mean that there isn’t a strong enough customer base to support it. Ideally, you’d want at least one other store in the same field, but one that you think you can surpass with better services, products, or prices.
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Study your surroundings. Besides other business, take some time to get a sense of what kinds of sports, hobbies, or activities are already popular or have the potential to become popular in your area.
- If you live nearby natural parks or preserves, outdoor activities like hiking or kayaking might be popular pastimes with a lucrative market.
- If your town is installing more bicycle lines and paths, there might be increased interest and demand for bicycle equipment. It might be the right time to open a sporting goods store that specializes in renting, selling, or repairing bicycles.
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Choose your niche market. There are several big name, national sporting goods chains out there which try to offer a smattering of everything and cater to every type of sports fan or hobbyist, from basketball to badminton, to fly-fishing. Instead of following this approach, consider focusing on specialty sports, like hunting and fishing or golf, in order to set yourself apart and become a go-to expert retailer.
- Focusing on a niche market will allow you to cover every aspect of a particular sport without having tons of inventory or spreading your resources to thin.
- You can focus on amateur and youth sports, as an example, and carry a wide array of products geared towards kids. You can also decide to go towards the other end of the spectrum and cater to a professional market base with only high-end equipment.
- You can also chose to focus on sports memorabilia and apparel rather than equipment.
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Develop a business plan . A business plan is a roadmap for reaching success with your company. Most basically defined, it is written description of what you plan to do with your business, and how you plan to do it. [2] X Trustworthy Source U.S. Small Business Administration U.S. government agency focused on supporting small businesses Go to source
- Start with a mission statement, or summary of your business and its greatest features or unique strengths. What will set you apart in the amongst other stores?
- Think about what specific products or services you would like to supply.
- Come up with a basic financial projection, including how much money you need to open your business (including store rent, inventory, equipment, employee wages, insurance, utilities, permits and licenses); how much money you currently have to invest and/or how much you need to borrow; and what kind of profit margins can be expected.
- Develop some ideas about marketing and how to promote your business.
- Think about what you would like to achieve in 3-5 years, and develop some specific steps or strategies for accomplishing these goals.
- You can take your business plan to a bank or loan office to get pre-approved for a small business loan or another line of credit. This might come in handy when renting store space, buying inventory, or paying employees before you start to turn a profit.
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Research store locations and options. It’s not only important to decide where you’d like to open your store, but also what kind of store space best suits your needs. There are brick-and-mortor options, of course, but there are also alternative options for where you can locate your store.
- Consider opening a store nearby major areas, parks, or places where sports are played. [3] X Research source
- Ideally, you’d want to be situated in populated areas with good foot traffic and accessibility, like a mall, though this can also lead to higher rent prices.
- If your selling particularly big or bulky items that people will need to transport in their cars, look for a location with ample parking. [4] X Research source
- If rent prices and building overhead expenses (like rent, utilities, and insurance) are too much for your budget, consider alternative options like subleasing a part of another store, securing a small kiosk in a mall, or opening an online only store. These alternatives to traditional, stand-alone storefronts have lower startup and overhead costs.
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Register your business. After all the research and planning, turn your dreams into a reality by legally registering your business.
- You might want to hire an attorney to help you with the legal documents needed to register your new business. It can get tricky, depending on your state requirements.
- Come up with a name for your business and register it with your local, state, or county business borough.
- Be sure to establish an Employer Identification Number with the Internal Revenue Service (if opening your store in the United States).
- Once you’ve registered your business, you can proceed with getting any licenses or permits as they might be required by your state or with your rental space.
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Stock your inventory. Now that you’ve decided on your niche market and store location, the next step is stock your inventory so that you can start selling and turning a profit.
- Decide on what lines you’d like to carry. Get a sense of what are the most popular or sought after products and brands by talking to sports enthusiasts, attending conventions, and reading sports-specific magazines.
- Find out what companies operate and ship products to your area. You can look through trade magazines or visit the National Sporting Goods Association’s website.
- Contact vendors to find out if they require a minimum opening order or if they offer any special promotions for new retail clients.
- See if you can place a wholesale order; usually it’s cheaper to order items this way rather than individually or in small batches.
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Hire employees. Depending on how busy your store is, you might need to hire a staff of employees to help with inventory, customer order, and sales services.
- Ideally your staff should be passionate and knowledgeable about sports. Your customers will be more inclined to listen to and trust people who are passionate about sports at a sporting goods store.
- If your budget cannot support paid help, consider teaming up with a local college and starting an internship position where you can show a student the ropes of running a business in exchange for their help in the store.
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Establish a strong web presence. Even if you have a physical storefront, having a strong web site is vital to your business’ success.
- In the beginning, start with the basics like your location, hours of operations, and some general information about your products.
- As you grow, consider including a full online inventory of your merchandise so that people can browse at home and even make purchases from outside of your local neighborhood.
- When creating an e-commerce website, it’s important to offer a safe shopping experience for your customers. Make sure your website is up to snuff with its safety settings and security features. [5] X Research source
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Advertise and promote your store. Once you’ve opened your doors, the next step is getting people through them. For this, you’ll need a good marketing and advertising strategy.
- If you have the budgetary flexibility, consider commissioning an advertisement firm to come up with a catchy company logo and some promotional materials. You can also hold a design competition for local high school or college students, and offer the winning designer a store gift card for their work.
- Take out some advertising space in local print or media outlets. Or hang a banner at the local sports field, if allowed.
- Find out if your product vendors have their own marketing materials that you can utilize to promote their product at your store.
- Offer promotional deals for those involved in local sports clubs and organizations. Forge a connection with the leaders of these clubs, and offer to become their official outfitter, to print up their jerseys, fulfill trophy orders, or take special requests for customized gear.
- Sponsor the athletic teams of a local school. You have the potential to reach all of the kids on the team, as well as their parents and the other teams they come into contact with.
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Feature unique items. Your best chance of succeeding and growing your business is to set it apart from your competitors and to do something better than they can.
- Be at the forefront of new equipment styles, models, and innovations.
- If you’re specializing in sports memorabilia, try to find and sell unique items not found elsewhere.
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Expand and diversify. A growing and thriving company will be able to expand and branch out into new avenues within its field. Once your business is up and running, look for other sports-related opportunities for diversification. [6] X Research source
- Consider organizing your own sporting events, tournaments, or expos for enthusiasts. [7] X Research source
- Get inventive and think about other auxiliary markets that intersect with your niche, like nutrition bars for hikers or medical practices that specialize in treating sport’s injuries, and see if you can team-up with them to forge mutually beneficial business relationships.
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Community Q&A
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QuestionHow can I lower my start-up costs for a sporting goods business?Community AnswerOne way that you can lower start-up costs is to not buy expensive goods immediately. You will want to work yourself up to the expensive ones. One other way that you could reduce costs is just start a kickstarter campaign.
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QuestionWhat is the profit margin in sporting goods?Community AnswerThe profit margin on sporting goods is anywhere between 20 to 25%, depending on your overhead. You have to make sure you have a mix of high and low priced products.
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QuestionHow can I keep track of accounts and tax returns of the store?Community AnswerThe easiest method is to get a point of sale (POS) software. You can buy a POS software at an affordable price, and it can keep track of all your business needs — inventory, sales, cash and bank, taxes etc.
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Expert Interview
Thanks for reading our article! If you’d like to learn more about starting a business, check out our in-depth interview with Pete Canalichio .
References
- ↑ http://www.entrepreneur.com/article/56778
- ↑ https://www.sba.gov/writing-business-plan
- ↑ http://www.entrepreneur.com/article/56778
- ↑ https://www.startupbizhub.com/How-to-Start-a-Sporting-Goods-Store.htm
- ↑ http://www.entrepreneur.com/article/84250
- ↑ http://www.businessnewsdaily.com/1200-workforce-diversity-good-for-business.html
- ↑ http://www.entrepreneur.com/article/56778
About This Article
Article Summary
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If you're passionate about sports and have some business experience, you can open up your very own sporting goods store. To make your business successful, find a niche and a location where your store will be highly in-demand. For example, if you live near a lot of schools, you might open up a youth sporting goods store. Or if you live near a National park, you might sell outdoor equipment like hiking gear. Once you have your idea, develop a business plan to layout information like what products you’ll sell, how much money you need to open your business, and how you’ll advertise. Remember that you’ll need to cover costs like store rent, utilities, inventory, employee wages, and business permits. Bring your drafted plan to a bank or loan office to apply for a business loan. When you’re ready to get off the ground, you’ll need to register your business with your local county business bureau, stock your inventory, and hire employees. To learn how to use advertising to grow your business, read on!
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