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 school supply 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 school supply store?
A store space must be rented or purchased. Alternatively, you can launch the business online in the form of a website. If you take the online route, you must pay for the domain name and website maintenance. School supplies ranging from staplers to paper, book covers, pencils, pens, markers, binders and beyond are necessary. Budget money for marketing along with a website, point-of-sale systems, retail display fixtures, inventory tracking software, a business license/permit, insurance, and labor. A handful of laborers will be necessary at the company's launch. Laborers include cashiers and those who stock the shelves. You can add more people to the payroll as the business grows.
What are the ongoing expenses for a school supply store?
Ongoing expenses include store rent, employee wages, supplies, insurance, utilities, high-speed internet and marketing. If you opt to rent your store rather than purchase the site where it will operate, you will likely spend between $700 and $1,500 or more per month in rent. The exact figure hinges on the location of your store and its size. Most employees will earn $8 to $12 per hour. If you hire a marketing professional, store manager or accountant, they will earn a salary in the range of $30,000 to $50,000 or more. The cost of supplies hinges on the size of your store and the number of customers you attract. Budget at least a thousand dollars per month for supplies and adjust the figure accordingly as time progresses. Budget at least a couple hundred dollars per month for utilities including high-speed internet. Allocate at least $200 or more per month for marketing efforts.
Who is the target market?
The preferred client is a parent with multiple school-age youngsters. In some instances, teachers shop for classroom supplies on their own. Both of these customer types are inclined to spend a significant amount of money at your school supply store business.
How does a school supply store make money?
The business makes money by selling school supplies to students, parents of students, teachers, and schools.
How much can you charge customers?
Your school supplies will sell at a wide range of prices. Something as simple as a bookmark will sell for as little as fifty cents. A fancy binder portfolio will cost upwards of $30. However, most school supplies fall in the price range of a couple dollars to $10.
How much profit can a school supply store make?
A school supply store has the potential to earn a profit of $20,000 to $50,000 or more in the first year. Grow the business, add another location, and profits can double in the ensuing year(s). Develop the business across the region and it is possible to earn hundreds of thousands of dollars or even a profit in the million dollar range.
How can you make your business more profitable?
You can branch out by selling academic texts, backpacks and toys like fidget spinners. Consider offering sales through your website. Customers can either pick up their online orders in-person at the brick-and-mortar location or you can deliver the items to the local purchaser. You can also try to sell office supplies along with holiday and party items to keep your store busy during the months in which school is not in session.
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.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your school supply 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, but if you still want to weigh all your options check our our article, What Structure Should I Choose for My Business?
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.
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 school supply 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.
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 school supply store is generally 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 a location:
- 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 school supply 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 a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your school supply 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 school supply store
Market your school supply store across an array of mediums. Advertise in the local paper and on local radio. It is also advisable to build a highly polished, easy-to-use website that appeals to youngsters, parents, and teachers alike. Optimize all of your online content for search engines (SEO). This means the website should be laden with keywords and key phrases pertaining to your locale, your inventory, and your customers. The website should also feature a regularly updated blog and links to your social media accounts. Update your social media accounts several times per week with information about sales, new inventory, special offers, and links to information that relates to academics.
Recommended: Get started with local advertising for your business with a $300 credit from Yelp.
How to keep customers coming back
The best way to attract customers is to position the business by several schools, universities, malls, and other businesses/organizations that attract youngsters. If your store is located far away from prospective customers, it will prove awfully difficult to attract a steady stream of business. Once you pinpoint the perfect location, get your name out there through a wide-ranging marketing push. Advertise in the local paper, on local radio, in flyers, on billboards, and on the web. In terms of retaining customers, make sure your inventory is high-quality and your prices are competitive with other local school supplies stores. Make sure you have a wide array of supplies that appeal to grade school students, junior high school students, and university students.
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 School Supply Store In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
This business is ideal for an individual who has a passion for academics and youngsters. There is plenty of money to be made by selling school supplies. Yet this business also plays an important role in the community as it provides students with the materials they need to learn and grow.
What happens during a typical day at a school supply store?
A school supply store business owner does everything from researching supplies to ordering supplies, pricing inventory, positioning inventory for sale, delegating duties to employees, handling payroll, and marketing the business.
What are some skills and experiences that will help you build a successful school supply store?
Keep your finger on the pulse of the local academic community. Interact with students, teachers, parents of students and distributors to stay on top of school supplies trends. Establish relationships with teachers who can steer students and their families to your store. It will also help to be a marketing guru. A substantial portion of your success hinges on your ability to market the school supply store business to those who need school supplies.
What is the growth potential for a school supply store?
This business has the potential to expand to new locations across the city in which it launches. It is even possible for the business to grow across the region and even the nation.
TRUiC's YouTube Channel
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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.
What are some insider tips for jump starting a school supply store?
Take some time to figure out how you can offer value that separates you from the competing school supplies businesses. Perhaps you can establish alliances with local schools and teachers that lead to significant sales. Maybe you can connect with vendors that sell trendy school supplies that students demand. Do not stop interacting with potential suppliers, customers and business partners. The growth of these relationships will help you procure low-cost supplies, ramp up sales and develop a loyal customer base.
How and when to build a team
A team is necessary right off the bat. You can't do it all on your own. Bring people aboard to man the cash registers, stock the shelves and answer the phone. You can handle accounting, marketing, inventory ordering, and administrative duties in the initial months. However, an accountant and a marketing professional will be necessary as time progresses. If your store succeeds, you might become too busy to handle store management duties. Bring on a store manager so you can focus on executive level duties.