Start a Supplement 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 guide to starting your Supplement 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 Supplement Store?
Supplement store start-up costs include a $40,000 franchising fee. Expect to pay $4,500 on equipment, $4,000 to $6,000 on signage, $30,000 on fixtures, $50,000 on construction and another $50,000 on opening inventory. Expect to pay about $2,000 on promotional and marketing materials. To be safe, expect to pay between $180,000 and $200,000 to start a supplement store.
What are the ongoing expenses for a Supplement Store?
Expect to pay about $2,000 per month for a retail space. Every year, supplement restock products can amount to as much as $100,000. Monthly utility costs, on average, are about $300.
Who is the target market?
As a supplement provider, your target market will be sports enthusiasts, gym-goers, health gurus, health-conscious individuals, the elderly, those with disabilities, and those who utilize nutrition as a daily health tool. These consumers are typically found at sports complexes, outdoor recreational areas and health provision buildings.
How does a Supplement Store make money?
A supplement store makes money by selling sports nutrition products, dietary supplements, health products and health foods. Some supplement stores may sell fresh shakes and smoothies. To make additional money, a supplement store may connect with a local fitness complex. In doing so, they can secure additional premises sales while garnering additional revenue from a complex’s courses, sponsorships and memberships.
How much can you charge customers?
Supplement costs vary greatly. A small bottle of Vitamin A, for example, might only cost $7. Performance-centric protein powder, meanwhile, can cost as much as $70. Customers should be charged fairly, however, because supplement stores which are “overpriced” don’t last very long.
How much profit can a Supplement Store make?
The average supplement store can make $100,000 per year in income. The industry’s average profit margin is around 38 percent. Maintain a consistent profit margin, as source product costs can easily cut into your store’s profits.
How can you make your business more profitable?
Start an affiliate program. Promote your products via nearby fitness centers. Then, offer discounts for gym-goers who enter your store via word of mouth. If you can network efficiently, you can design a program capable of sustaining growth. Whenever the chance arises, invest in your own product line. In doing so, you’ll reduce sourcing costs. If you’re knowledgeable in supplements, you can also create superior products which are well-priced.
What will you name your business?
Choosing the right name is very important. Read our detailed guide on how to name your business. 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 Supplement Store is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
Form Your LLC
Read our Guide to Form Your Own LLC
Check out the Top Business Formation Services from our friends at StartupSavant.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
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: Find the right bank for you, read our review of the Top 5 Banks for Your Small Business
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
Most states require retail businesses to obtain a seller’s permit. A seller’s permit enables states to record and collect taxes from the sale of taxable goods and services. More information can be found here:
Certain state permits and licenses may be needed to operate a supplement business. 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.
Certificate of Occupancy
A supplement business can be 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 supplement business.
- 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 supplement business will be in compliance and able to obtain a CO.
STEP 7: Get Business Insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
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 Supplement Store
Promote your supplement store by establishing it near health care facilities and local gyms. When possible, network with local fitness complexes. To increase your store’s revenue, you’ll need to remain active in the fitness community. Create a website after your grand opening. Share links with online social networks. Give out coupons when possible. Marketing success, by and large, will be determined by your store’s ability to capture an audience’s attention via sports complexes, grocery stores and health providers. It’s a good idea to use print advertisement, too. When possible, offer coupon deals and distribute paper discount codes to nearby retail outlets.
How to keep customers coming back
Customers will return for well-priced products and quality supplements. Because the Food and Drug Administration regulates supplement prices, many supplement stores offer rewards programs to reduce overall costs.
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 Supplement 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?
Anyone who’s excited by sports, diet or health supplementation will do well in this business. Operating a supplement store requires a high degree of knowledge about the human body. For this reason, an undergraduate degree in exercise science, fitness, fitness health, or even biology is useful. A lot of supplement store operators work at fitness centers.
What happens during a typical day at a Supplement Store?
A supplement store is a retail space, so it typically handles customer purchases, stocks products, performs audits, and handles customer requests. Customers should be assisted, and products should be arranged by supplement section—for example, sports supplements, joint care supplements, dietary supplements, and so on. General maintenance includes mopping, sweeping and vacuuming. While a supplement store’s products are all contained within cans, jars and bags, a supplement store must still uphold the cleanliness standards other grocery stores are expected to meet.
What are some skills and experiences that will help you build a successful Supplement Store?
Research the type of nutrition products you’d like to supply. Supplement stores might be rare in your area, but those staffed by knowledgeable staff tend to succeed. Your supplement store should also have a mission statement, listed goals and a plan to achieve said goals. Break down your start-up costs, break-even analysis numbers, and financing basics.
Also, contact other nutritional suppliers. Get competitive quotes, and aim to beat the competition’s price while growing your business. Before you franchise, you’ll need to secure high profits. Ideally, establish your supplement store in the same complex as a gym or a medical complex.
What is the growth potential for a Supplement Store?
A supplement store has quite a lot of growth potential. In fact, large business entities like Vitamin Shoppe operate on a national scale. Many supplement stores open their own line of supplements. By supplying the most popular brand at a good price, a supplement store can achieve decent success as only a local entity.
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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 Supplement Store?
Successful supplement stores thrive on consumer trust. For this reason, it’s unwise to promote supplements beneath the ruse of superior sports training. While you can absolutely sell sports nutrition, you should stock, promote and sell products based on their health quality, reliability and adherence to federal Food and Drug Administration goals. Many supplement stores lose customers due to overpriced products, false advertisement and an inadequate selling structure.
How and when to build a team
A supplement store owner should hire at least two employees before conducting a year of business. Between sourcing products, operating a register, marketing, management, financing, stocking, and supplement promotion, a supplement store’s owner has a complex, often busy, schedule. By hiring several employees, a supplement store owner can assure quality services while growing and scaling effectively.