So you’re thinking of getting into the fantastic world of convenience store ownership? Convenience stores are a challenging yet exciting business. At its heart, convenience stores are a hybrid of the grocery store and general retail industry. While many of the same rules and concepts from these industries apply to a convenience store, there are also other factors to consider.
Owning your own business is hard work. Convenience store management is no different. There is plenty to think about before diving into the business. Here are a few things to consider:
Location, Location, Location
One of the biggest factors for any brick and mortar business is your location. Convenience stores are no different. Although when you think of “location,” you may be tempted to only consider the physical space your store will occupy. While this is important, the unique challenges of your operating area also warrant consideration.
Traffic and accessibility are key factors, along with the presence of any competition. If there isn’t a lot of competition in the area this may be a good sign that there is an opportunity for your business to thrive. On the other hand, too much competition in the area may mean there aren’t enough customers to go around.
Market research firms can assist you with conducting a thorough review of your area. In addition, The Small Business Development Center also provides free customer demographic reports for most areas in the United States.
Develop Your Business Plan
Regardless of whether you are opening your business as a sole proprietorship or as part of a franchise, a business plan is 100% necessary. There will be differences if you’re a franchise. For example, your marketing, branding, and even your suppliers may already be pre-determined. As a standalone store, you’ll have more freedom to operate.
In either case, a business plan helps keep your business structure organized. It also outlines plans for your growth and development, financial backing, and defines the roles of everyone involved. No matter what business you’re going into, writing your business plan is a vital step.
Inventory Tracking and Management
If you’re a standalone convenience store, it’s obvious that the bulk of your money will come for the sale of products. If you’re a gas station with an attached store, it may surprise you to learn that the bulk of your profits also come from in-store purchases rather than gas sales.
Proper inventory management and tracking will help drive your profitability. It will also help reveal trends and identify the more profitable items in your store.
Convenience Store Management
While many people think of convenience stores and gas stations as businesses that “run themselves,” the truth is that there is a lot of work involved at the management and staff level. Since most customers expect these stores to be open 24 hours a day, you will need to be staffed around the clock.
Respect the convenience store gender gap. While most convenience stores cater to men, women make up a large percentage of convenience store customers. According to the Realities of the Aisle C Store Study, there is a great opportunity to capitalize on women customers.
Women (43%) are more likely to engage in coupons or loyalty programs over men (35%). They are also more frequent users of the bathroom which opens up possibilities to offer expanded hygiene products, or strategically place certain items near the bathroom.
Overall, women make up roughly 20%-30% of the cstore customer base, so don’t forget the ladies!
An Exciting Opportunity
Opening a convenience store is a great investment for financial and professional security. There is hard work ahead, but the best, most profitable businesses are never easy! There are many keys to successful convenience store management. Following this guide will help give you a leg up on your competition.