Business Plan - Setting up a Market Stall (UK)

[MrSweet1991]

Hi All,

I did post this on another website but I've had no replies so thought I'd try my luck here, I've added loads of information most of which you may not need to know to help me so it may be ideal to just sift through but any feedback and advise would be great, I should also note I live in the UK

I’m currently in the process of applying for the New Enterprise Scheme through the job centre. Currently my advisor is happy with my initial idea, but she wants me to take three weeks to prepare everything on paper before she put me through to pitch my idea to the professionals

<–Background information–>
So far I have a clear idea of what I wish to do, and that’s is offer a repair service for PC’s and laptops as well as Tablets and Phones. Since the age of 13 I was fascinated at seeing my dad fix friends and relatives computers, and quite frankly seeing it at that age looked like something out of the matrix (old floppy disk commands to format a hard drive). But quickly I developed so many skills throughout the years and by 15/16 I was already a second choice for fixing my dads friends/relatives as they knew I was capable. To current date I’ve completed a BTEC First and BTEC National Extended Diploma in IT Practitioners and as of January 2015 took a temporary withdrawal from University studying Business Information Technology due to family circumstances. Throughout my three years at university I’ve created leaflets for businesses and also carried out computer repairs for friends as well as customers (through advertising) and for the repair services I have done, I completed them accordingly and everyone was happy with the service provided.

<– Business Idea –>
So.. Time to take the next step and plan my idea. To start off I want to focus on fixing computers, laptops and phones as this is something I can confidently do myself and requires (from my point of view) low startup costs as most repairs require skills and knowledge, and for the hardware sides of things I’m hoping to use the £1000 loan from the New Enterprise Scheme to build a computer system (built on a rack for easy swapping of computer components as CEX uses) and invest in cheap hardware such as laptop and desktop hard drives, system and CPU Fans, Power Supplies, RAM, Keyboards and Mice, anti static mats and so forth.

Providing I get myself a good amount of customers and can maintain profit I’m hoping to invest straight back into the business and build desktops sourcing second hand parts and building from scratch to ensure I reduce costs. Furthermore I’d like to invest in higher end computers such as fully water cooled systems (very rarely see these, maplins and PC World don’t seem to sell any) and the only one shop I’m aware of is Overclockers based in Stoke on Trent. As well as building and selling desktops I’d like to invest on higher priced items such as Solid State Drives, graphics cards and so forth.

As for a market stall I’m currently trying to identify what’s available to me taking into account prices, distance and weather I can secure a market stall (I have read until you show that customers use your services you may not be offered your own stall?) I’m also trying to identify the costs of a stall as well as running costs (electricity) and so forth so I can identify a break even point and forcast what I would assume is a realistic income.

So yeah, so much to do and very little time. I’m a complete newbie and have so much to learn but I’m enthusiastic and commited to making this work. Based from what I’ve said I’d love to hear any feedback, recommendations, corrections and personal experience.

Thanks to all that have took the time to read and in advance to those who provide any information.

 

[jmitservices]

Is this a fixed position market stall or something that you'll have to setup on a daily basis? I can see space being a real problem here. We have some fixed market stalls in my local town and they are very small. Would probably get 4-5 machines going at any one time. Then you are going to need space for tools and stock etc...

Don't forget you might have to pay a service charge and business rates. You'll also probably be tied into a lengthy contract. (Its 5 years for my town)

 

[Markverhyden]

Obviously I don't know the particulars of running a business on the other side of the pond. But a few observations that apply to most any country.

The advisor is looking for a business plan. You will need proforma operating/financial statements. Part of that is creating possible scenarios. Worst case, average, and best case.

Running a store front, what we call it over here, appears to be simple. But you have to understand that your traffic depends on walk in customers. Retail is a brutal business and consumers are just as bad. Especially in times like these. @jmitservices makes a great point. You have to look at what you are on the hook for in terms financial contracts.

On the parts/inventory stuff. There is something called inventory aging. Basically when you buy something it's value decreases over time. Some are obvious, like fresh produce in a grocery store. Others are not. When I worked at CompUSA, a defunct major big box computer retailer in it's day, that concept was very real. When a business buys generic type products for resale they are generally stuck with the product, no returns. We would get high end parts, RAM, video cards, etc and they would be obsolete with in 6 months. So the company is stuck with product that no one wants to buy,

 

[NYJimbo]

Furthermore I’d like to invest in higher end computers such as fully water cooled systems (very rarely see these, maplins and PC World don’t seem to sell any) and the only one shop I’m aware of is Overclockers based in Stoke on Trent.

My experience is that the type of people who would buy these machines are the same people who prefer to build it themselves. We had a guy here who tried to sell really high end custom gaming machines and he found out that gamers like to build them from scratch.

 

[FremontPC]

I'd be worried about security and liability if someone makes off with a customer's laptop, etc.

I could see it as a convenient spot where people could get some questions answered, quick and easy while-you-wait repairs, Win8 refresh and the like, maybe some fast-moving accessories. Might be good as a front end to build up a mobile service. I'm not sure I'd want a customer's laptop/device hanging around for even so much as an hour in that environment.

 

[gikstar]

Storefront...so you haven't worked for another tech company with a storefront? Let's be frank about this, you don't have enough experience to handle all the problems that will come up with running a storefront and I gather you're new to this website. Other storefront owners talk about their 'opportunities' (as I like to call them) on here and how they have successfully handled them and also the 'opportunities' they have had with various customers.
You haven't mentioned anything about experience with accounting/bookkeeping, purchasing, filing taxes, etc, all important things you need to know to run your own business or making enough money to hire someone to do it for you.
As it's been pointed out, gamers like to build their own high-end systems but if you have experience in building them maybe someone will come and have you put it together for them (building water-cooled systems are a pain in the assssssss and time consuming).
Selling used systems, I can see that... look at local recyclers for good deals and resell them through local free ads (we have Craigslist here in the USA).
If I were you I would work from home, purchase some used server equipment to train on, take courses in computer networks/servers to make yourself valuable to business clients. Very few IT businesses are successful just working with residential clients. You need to build up a client base before you open a storefront and if and when you do, it's best to have someone to partner with who maybe has some skills that you don't and cover you when you can't be there or are out in the field. Most of the time you will need someone covering the storefront at all 'open' hours.

We don't have a storefront and don't want one as most of our clients are managed serviced where we just need an office to work from. We have a house with a family room and a living room and one of these has been converted into our workshop along with a server rack in the garage which is on the other side of the wall from the workshop. This works our great since one can work any hours of the day that's needed and quite often don't have to get up until the phone rings.

If you are the only person in the store or kiosk and a group of people come by, it can be like a small mom & pop store with product walking out of the store without you seeing it happen. It's hard to get work done when you're being distracted by people coming by just to ask questions because they have nothing better to do at the moment.

I don't mean to rain on your parade but if you were my son, this is the advice you would get from me (if you asked)

 

[Kitten Kong]

+1 fir gikstars approach. my advice walk before you can run.

Read the forums, especially all the arilticles. There is more knowledge on this forum alone, than probably the rest of the Internet. Slight exaggeration, but not by far.

 

[MrSweet1991]

Is this a fixed position market stall or something that you'll have to setup on a daily basis? I can see space being a real problem here. We have some fixed market stalls in my local town and they are very small. Would probably get 4-5 machines going at any one time. Then you are going to need space for tools and stock etc...

Don't forget you might have to pay a service charge and business rates. You'll also probably be tied into a lengthy contract. (Its 5 years for my town)

Hi Jimitt,

Thanks for your input, now as for a permanent position or something that I'd set up on a daily basis I'm not sure of that just yet. If I'm not mistaken there are some indoor markets that may just offer you the stall as long as you pay the rent, however (if I'm not mistaken again) there are other markets that allow you to set up but not on a permanent basis, instead they asses you and see what value you bring, as long as customers use you then its fine. It's just that they don't want people setting up where no customers go to which has a negative affect on the entire market.

Absolutely space will be an issue in terms of how many I would be able to do on a daily basis, but on the other hand rent is around.. 65 per week give or take and insurance is around 60 per month I think then you have electric.. so a half educated guess I need a weekly income of around 90 so assuming I could fit in around 4 - 5 computers a day at say 30 each that would be 600 a week which is greatly out weighing the costs.

As for a contract I'm relatively sure there isn't one, my dad once upon a time set up a stall and he just left one week and that was it

 

[MrSweet1991]

Obviously I don't know the particulars of running a business on the other side of the pond. But a few observations that apply to most any country.

The advisor is looking for a business plan. You will need proforma operating/financial statements. Part of that is creating possible scenarios. Worst case, average, and best case.

Running a store front, what we call it over here, appears to be simple. But you have to understand that your traffic depends on walk in customers. Retail is a brutal business and consumers are just as bad. Especially in times like these. @jmitservices makes a great point. You have to look at what you are on the hook for in terms financial contracts.

On the parts/inventory stuff. There is something called inventory aging. Basically when you buy something it's value decreases over time. Some are obvious, like fresh produce in a grocery store. Others are not. When I worked at CompUSA, a defunct major big box computer retailer in it's day, that concept was very real. When a business buys generic type products for resale they are generally stuck with the product, no returns. We would get high end parts, RAM, video cards, etc and they would be obsolete with in 6 months. So the company is stuck with product that no one wants to buy,

Hi Mark,

At the moment they're looking for a business idea not a plan, if I can pitch them an idea that they feel has potential to earn money they will progress me onto the next stage which involved assigning me a business mentor who will help me develop a business plan and also put me through training for accounting, marketing and so forth basically train you weekly in which you will then on a weekly basis end up with a business plan. At the end of it you then hand in your business plan and if accepted you get a 1000 loan and they also pay you 65 per week for 6 months which pretty much pays for the market stall rent (its around 65 give or take)

In respects to contracts and so forth the market stalls as far as I'm aware don't' have any, you just pay your rent weekly and if you don't' wish to carry on you just leave.

Yes inventory ageing is something that I have thought of, I'm not really going to try and focus initially on getting in a lot of stock as wholesalers tend to offer half descent prices but on big minimum order quantities so it sort of outweighs itself when I'd only have a few customers. What I wish to focus on is DC jack repairs, screen replacements, windows installs, data recovery.. any parts needed I may just order on request and charge a small fee if they don't' want to leave the laptop with me (a fee in which gives me the funds to pay return postage if the customers doesn't return)

But I don't want to cut it off completely I will stock USB sticks, CD, DVD's a few hard drives and what not on top of all the other essentials for carrying out diagnosing computers.

 

[MrSweet1991]

My experience is that the type of people who would buy these machines are the same people who prefer to build it themselves. We had a guy here who tried to sell really high end custom gaming machines and he found out that gamers like to build them from scratch.

Indeed something to take into consideration.. maybe scour the internet locate all the parts and add pictures of high end rigs to my leaflets and what not so I don't actually invest into anything until I have a potential order. And beauty of that is as you say if a graphics card has depreciated I could either adjust the price lower or replace it with a newer graphics card.

 

[MrSweet1991]

Storefront...so you haven't worked for another tech company with a storefront? Let's be frank about this, you don't have enough experience to handle all the problems that will come up with running a storefront and I gather you're new to this website. Other storefront owners talk about their 'opportunities' (as I like to call them) on here and how they have successfully handled them and also the 'opportunities' they have had with various customers.
You haven't mentioned anything about experience with accounting/bookkeeping, purchasing, filing taxes, etc, all important things you need to know to run your own business or making enough money to hire someone to do it for you.
As it's been pointed out, gamers like to build their own high-end systems but if you have experience in building them maybe someone will come and have you put it together for them (building water-cooled systems are a pain in the assssssss and time consuming).
Selling used systems, I can see that... look at local recyclers for good deals and resell them through local free ads (we have Craigslist here in the USA).
If I were you I would work from home, purchase some used server equipment to train on, take courses in computer networks/servers to make yourself valuable to business clients. Very few IT businesses are successful just working with residential clients. You need to build up a client base before you open a storefront and if and when you do, it's best to have someone to partner with who maybe has some skills that you don't and cover you when you can't be there or are out in the field. Most of the time you will need someone covering the storefront at all 'open' hours.

We don't have a storefront and don't want one as most of our clients are managed serviced where we just need an office to work from. We have a house with a family room and a living room and one of these has been converted into our workshop along with a server rack in the garage which is on the other side of the wall from the workshop. This works our great since one can work any hours of the day that's needed and quite often don't have to get up until the phone rings.

If you are the only person in the store or kiosk and a group of people come by, it can be like a small mom & pop store with product walking out of the store without you seeing it happen. It's hard to get work done when you're being distracted by people coming by just to ask questions because they have nothing better to do at the moment.

I don't mean to rain on your parade but if you were my son, this is the advice you would get from me (if you asked)

Storefront...so you haven't worked for another tech company with a storefront? Let's be frank about this, you don't have enough experience to handle all the problems that will come up with running a storefront and I gather you're new to this website. Other storefront owners talk about their 'opportunities' (as I like to call them) on here and how they have successfully handled them and also the 'opportunities' they have had with various customers.
You haven't mentioned anything about experience with accounting/bookkeeping, purchasing, filing taxes, etc, all important things you need to know to run your own business or making enough money to hire someone to do it for you.
As it's been pointed out, gamers like to build their own high-end systems but if you have experience in building them maybe someone will come and have you put it together for them (building water-cooled systems are a pain in the assssssss and time consuming).
Selling used systems, I can see that... look at local recyclers for good deals and resell them through local free ads (we have Craigslist here in the USA).
If I were you I would work from home, purchase some used server equipment to train on, take courses in computer networks/servers to make yourself valuable to business clients. Very few IT businesses are successful just working with residential clients. You need to build up a client base before you open a storefront and if and when you do, it's best to have someone to partner with who maybe has some skills that you don't and cover you when you can't be there or are out in the field. Most of the time you will need someone covering the storefront at all 'open' hours.

We don't have a storefront and don't want one as most of our clients are managed serviced where we just need an office to work from. We have a house with a family room and a living room and one of these has been converted into our workshop along with a server rack in the garage which is on the other side of the wall from the workshop. This works our great since one can work any hours of the day that's needed and quite often don't have to get up until the phone rings.

If you are the only person in the store or kiosk and a group of people come by, it can be like a small mom & pop store with product walking out of the store without you seeing it happen. It's hard to get work done when you're being distracted by people coming by just to ask questions because they have nothing better to do at the moment.

I don't mean to rain on your parade but if you were my son, this is the advice you would get from me (if you asked)

Hi Gikstar,

thank you for your detailed and long input, I haven't worked with a store front I was close too
but man he was going to take me in for a ride so I never went ahead. Now.. store front I have no
experience but I did use local buy and sell pages on Facebook to advertise myself while I had finished
my first year at university so I've had experience with communicating with customers and carrying
out repairs all of which went great, I was even getting recommended by others.

Now what I haven't gone into detail is the New Enterprise Scheme which is what's going
to help me start a business, I need to come up with a business idea first. If I pitch over the phone
my business idea and they see this idea has potential they will then assign me a business mentor
who currently runs a successful business and they will also make me attend workshops.
In these workshops they will teach accounting, marketing and all other aspects and I'm expected
to listen, learn and develop a business plan so the plan comes after I pass the idea which is
why at the moment I haven't included the financial aspect of running a market stall, right now
they want an idea and where this all came from (to see if you genuinely are passionate or bored)

Yes someone previously mentioned that the problem with high end computers is that they can
quickly depreciate in value so something that may be more appropriate is source
out parts and figure out how much they would cost then advertise a picture with the components
and then I could build to order and update the prices to correspond with the depreciation
to maintain value for money.


Servers and networks is definitely a weak spot for me, of all the things I have done it's
networking that I've never really looked into and I have read that a lot of people tend
to make so much more money through contracts and setting up networks for small
business so I'm definitely missing out in that respect, but non the less I can always purchase
the hardware and work on a small project at home so at one stage in my life I may
be able to offer that service out. I did however work on creating a server on a raspberry
pi at University, we created a website and then ran the website from the raspberry pi as
well as a MySQL server and also a file server using SAMBA and some other stuff but
I really can't remember much from it even though I achieve high marks for it.

In respects to gaining a client base before opening a store front it would prove advantageous
but the great thing about setting up a market stall is it only costs around 65 pounds per week
in rent add in electricity and insurance it goes up a little but it shouldn't be very hard to profit
given the small running costs. And the New Enterprise Allowance gives me 1000 pounds as well
as 65 pounds per week for 6 months so my rent is pretty much covered for 6 months I just
have to make up the electricity and insurance.

In respects to the groups of people and potential theft there will only be a shelf and everything else
will be behind it and possibly the desk may be made out of glass with products inside so
that shouldn't be too much of an issue.

well, thanks for all your input I will take all on board and think about it. Again it's very early days
I've yet to see if my idea is accepted and assuming it does I will get a lot of help from
current business owners as well as a crash course in marketing, accounting and all the rest

 

[Markverhyden]

I don't mean to rain on your parade but if you were my son, this is the advice you would get from me (if you asked)

My daughter gets advice without asking... LOL!!!