How to Start a Hardware Store

Business Overview:

In today’s world of do-it-yourself repairs and installations, learning how to start a hardware store could be one of the most lucrative business ideas available. This is not a small venture, however, and having a hardware store business plan will be the difference between success and frustration. Not only will you need a large space for your business, typically between 20,000 – 30,000 square feet, but you will need to stock that huge space with tools, materials, equipment and more. One option open to an entrepreneur starting a hardware store is purchasing a hardware store franchise. A franchise would come with everything you would need to get started but you would not have the freedom to choose what items you stock. Whether you open your own store or buy a franchise, it’s important to research your area to gauge its growth potential, the socioeconomic status of your customer base and what your competition’s weaknesses are. Figure out how you can compete with larger chain stores and don’t be intimidated with their market share. Studies show that smaller hardware stores are able to successfully share the market and, in fact, many consumers like independent stores for the level of customer service they receive. Many of your sales may come from local handymen, but you’ll also have plenty of homeowners frequenting your shop. When opening a hardware store, it’s important that you establish a good relationship with wholesalers to keep the right items on your shelves. You could also get your stock directly from manufacturers or distributors but usually wholesalers offer the best prices. With the right stock, a well-trained staff and excellent customer service, your hardware store business will flourish in your community.

A Day in the Life of a Hardware Business Owner:

This article brought to you by Business Ideas! If you enjoyed this article, make sure to subscribe to the Business Ideas Newsletter to get ideas sent straight to your email inbox.Since your clients will not only be weekend warriors since you will also have contractors doing business with you, your day will begin early as you will need to be open before their work day starts. You will spend your day assisting customers and contacting your suppliers. You will answer questions from your staff and generally manage your store. Keeping a close eye on your inventory will be a key practice for this business. At the end of the day, you will record your receipts and make sure the store is neat and organized for the next day.

About Your Customers:

Your customers will be homeowners, property managers and contractors needing quality home-improvement supplies at a reasonable cost.

What You Need to Start:

• Storefront
• Business plan
• Staff
• Stock of items to sell
• Shelving, racks, display cases, etc.
• Computer with finance software

The Good:

• The demand for hardware stores is very high.
• The potential for profits is also very high.
• Once your staff learns the business, you can be free to concentrate on managing and advertising.
• You will have access to all the latest tools and gadgets.
• You can expand on your business by offering in-home services.

The Bad:

• The startup investment is high.
• It can take some time to see a profit.

Resources:

• North American Retail Hardware Association
• Decorative Plumbing and Hardware Association
• Wikipedia on Hardware Stores

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