Start a running store by following these 9 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your running store. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a running store?
Running shop owners are advised to lease a space less than 2000 square feet. Even if your vision is to occupy more space, working up to that will help keep your overhead expenses down until the business can support a larger store.
Once you’ve determined your location, you can start designing the space. There’s a few items you’ll need:
- Computer and software management system
- Marketing strategy and materials
- Foot and gait analysis system - while not required, this will help you better educate and serve your customers
Depending upon how large your store is and how much inventory you plan to order, total investment could range from $155,000 - $325,000. Fleet Feet Sports requires investors to have $180,000 - $338,000 to open a new franchise store.
What are the ongoing expenses for a running store?
Much like startup expenses, this will vary depending upon the specifics of how your organization is structured, how much inventory you carry, and how large of a space you occupy. Shop owners advise budgeting for between $5,000 and $19,000 per month.
Who is the target market?
The bulk of your business will come from experienced runners who regularly invest in their passion. You’ll meet sponsored runners, ultra marathoners, and those training for the next local race. They’ll all have one thing in common - they’re passionate about their sport and are always looking for that new product that will help them achieve a new personal best.
The second demographic your business should cater to is the novice runner and individuals involved in other sports. This is your opportunity to gain a new, regular client. When treated right and educated properly, many of these customers will realize a newfound passion, and have you to thank for it.
How does a running store make money?
As a retail store, your business will generate a profit through the sale of each item.
How much can you charge customers?
Pricing varies depending upon the product. Items are purchased at cost and marked up to ensure a reasonable return on your investment. If you’re inexperienced in pricing merchandise, ask your manufacturer for assistance.
How much profit can a running store make?
It’s important to remember that businesses spanning every industry report earning little to no profit the first year (up to three years). Successful running store owners, however, have reported a profit, earning up to $75,000 after the third year. The key is to keep up with the latest trends and offer those, particularly the items with a higher profit margin. Insole products average 55% profit, while compression socks and sleeves average 51% profit, so these are great items to stock your shelves with.
How can you make your business more profitable?
Running stores have found success implementing these strategies:
- Partner with local races. Participate as a vendor and sponsor races. This will increase the store’s visibility and assist in establishing a name for yourself within the community.
- Host fitness classes. There are a number of strength and yoga exercises that help build a runner’s stamina, strength, and speed. Plus, it’s a great way to support the social facet of running.
- Offer educational workshops that will help runners with training and injuries. Design them so there’s something for every skill level.
What will you name your business?
Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your running store is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
For most small businesses forming an LLC is a great option, and it's easy enough to form by yourself, or check out the top business formation services.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Recommended: You can get $200 when you open a Chase business checking account with qualifying activities. Learn more.
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a running store. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
In addition, certain local licensing or regulatory requirements may apply. For more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Certificate of Occupancy
A running store is usually run out of a storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease office space:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a running store.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build office space:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for you business’ location to ensure your running store will be in compliance and able to obtain a CO.
STEP 7: Get Business Insurance
Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a running store
As mentioned, the running community is very tightly knit. Your strongest marketing tool will be your time and attention. Many running stores organize group runs. This is an opportunity for runners of all levels to interact and learn from each other. Participating in these outings is a great networking opportunity in an informal setting. Take it a step farther and set this up as a running club, offering members a discount on store purchases.
Another great way to get your name out there is to sponsor runs. You could organize the run yourself, or invest as a sponsor in an established community race. Those really looking to give back to the community have found success partnering with a shoe manufacturer and sponsoring young athletes. High school runners are provided shoes and running gear in an effort to support their sports journey.
How to keep customers coming back
Word of mouth can be your strongest marketing tool (or your worst enemy), particularly in the running community. Consistently strong customer support and education is paramount to building and retaining a customer base. Customer service, however, is only part of the recipe for success. Quality products at every price point are also critical for your business’ long-term growth.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start a Running Store In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
While prior running experience isn’t required to run a successful running store, the entrepreneur with hands-on experience in the sport would be best suited for this business endeavor. Customers will seek your guidance on products available in the market, as well as training and nutrition advice. If you’re considering this new business venture and aren’t an adept runner, surround yourself with a retail team that is armed with the necessary information.
What happens during a typical day at a running store?
The specifics of your day will vary, depending upon how you decide to structure your business and the specific services you decide to offer.
Most days will include the following activities:
- Track inventory and place orders
- Check displays to ensure everything is featured properly. Change out window displays.
- Consult customer to determine what product they’re shopping for. You’ll need to draw enough information out of them to adequately recommend the items best fitting their needs.
- Converse with customers regarding race training, upcoming races, and running injuries.
- Educate yourself so you’re able to converse with customers on the latest trends. This will also ensure your shop offers the trends that you stand behind and feel comfortable recommending.
- If local runners meet up for group runs at your shop, join in.
Initially, your role will also require you to perform the standard administrative duties. When you’re ready, the store manager can take over a majority of those duties.
What are some skills and experiences that will help you build a successful running store?
Success in the retail industry requires a commitment to customer satisfaction and strong interpersonal skills. From staff, to customers and vendors, your day will be spent interacting with others.
While running is a sport often achieved alone, it’s a tight knit community. Everyone inspires each other and cheers each other on as they work to achieve their goals. It takes a special person to believe in him/herself unwaveringly. However, this trait makes for the perfect running store owner, as that energy will be infectious, inspiring everyone around you. This drive will not only help others achieve their fitness goals, it will position you as a fitness leader in the community. This leadership will help your shop achieve long-term success.
What is the growth potential for a running store?
Runners enjoy the individualized attention they get when visiting a small, locally owned running store. Employees are able to provide quality service, spending as much time as necessary on each customer. For this reason, many store owners choose decide to keep their shop small.
That’s not to say, however, that there’s no growth potential. In larger cities, many entrepreneurs have found such success they were able to open multiple stores throughout their town and surrounding areas. Enterprises such as Fleet Feet Sports offer franchising opportunities to the right candidates. Investors receive the backing of an experienced, well-known organization, providing a leg up on the competition.
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a running store?
The following are some tips from successful running store owners:
- While your store should start out fairly small, think big in terms of the inventory you carry. Invest in quality products, with price points that fit every budget.
- Keep up with the latest running shoe trends and reviews. Be sure to carry those items.
- Offer a flexible return policy. If a runner knows they can bring a pair of shoes back after a week’s worth of “test runs,” they’re more apt to invest in the shoe they really want. Just make sure the rules are clearly defined to avoid any damaged returns.
- Develop strong relationships with your vendors. Several shoe companies have made it their policy to accept returned shoes, regardless of their condition, if the customer wasn’t satisfied. They absorb the cost, at no penalty to the store owner.
- Talk to your manufacturers about making one of their catalogues readily available. Given the opportunity to peruse the catalogue home, many customers return with a sizable order.
How and when to build a team
Upon opening your doors, you could probably operate the store yourself. As the business starts to grow, however, you’ll need to start building your team. It is critical that staff members be passionate and knowledgeable about running and everything that it encompasses. Many entrepreneurs have found that hiring the high school students they sponsored is an affordable option.