[whathousework?]

Hi EB

The local corner shop in our suburb has become available for lease (freehold also available, but we're not in a position to buy outright at present) and I'm thinking of giving it a go. I've contacted the vendors agent and had a look through the financials they provided and it is a solid, though modest, profitable business. At present it's just a dingy convenience store, ergo it has a ton of potential (I'm thinking bakery bread, fresh fruit and veg, etc). Apart from the long hours and staff, what are the negatives I'm not seeing? Hit me with any questions, too.

[doctorseuss]

My DH runs his own business. Other negatives are erratic income (none initially), minimal holidays, working weekends and evenings as there is always something to do, constant staffing problems - he can always do it better than his staff.

If you are in a good area (weathly, lots of SAHM)though I think your idea could work well. Check out the local competition.

[whathousework?]

There is only one other convenience store in the suburb and it's not as popular for a variety of reasons. In any event, the suburb is large enough to support the two. There is no other businesses in short walking distance and public transport sucks.

Ours is an older suburb and council is starting to talk heritage listing; there is a good mix of older residents and young families.

Currently, they only sell your usual over-priced chocolates, soft drinks, and smokes. I would be looking to get in local produce and there is unused takeaway facilities there that could be explored, too. I would also like to stock organic products.

There will be income from the get go as the business is already established.

For those in WA, I'm picturing a semi-deli like the awesome ones around Cottesloe and Claremont.

[Shellby]

There will be income from the get go as the business is already established.

Don't always believe the books, plus customers maybe loyal - to the old owners not the store itself so you find alot of the customers will use the time to check out the competition as they feel they don't owe the old owners anymore.

I have met many people who have brought a 'stable' making money business to find that didn't keep happening after they brought it.

There are long hours and no holidays and even when you do have holidays your on call and half the time don't go away incase the business needs you. Once you start hiring staff you will find noone does as good as you so sales when your not there are normally less so you tend to stay there more so your not paying staff and get more returns.

When your not there your thinking about it, thinking options and things to change. Or your doing your books and BAS, so you never get to just close the door at night and switch off - there is always something to do.

Also where is the local supermarket? Alot of our corner stores have died because if I'm going out anyway I may as well go that extra km or 2 and get the milk cheaper and those whatever I like I can get there that they don't stock.

Also be careful once you get into takeaway food etc as you will need food handling cert. and then include inspections from the council etc which you get to pay for. So it can be a big start up if that isn't already in place, as well as checking the current equipment will meet the current guidelines for temps etc. Same with deli meat, that is where most food poising occurs so its very strict food handling skills as you would hate for a staff member to leave something out 5 minutes to long and your customers end up sick.

Yes I'm a negative on small businesses, mainly shops. I have been there, I also know many who have been there or are there. I have seen how run down you get, have the income changes each week so you can't budget well. I have seen people's health go south and alot of them when they finally get out wish they never did it to start with - me being one of them.

[~zael~]

Yes I'm a negative on small businesses, mainly shops. I have been there, I also know many who have been there or are there. I have seen how run down you get, have the income changes each week so you can't budget well. I have seen people's health go south and alot of them when they finally get out wish they never did it to start with - me being one of them.
[/quote]

Totally agree. We have a retail (butcher shop). I swear my husband has aged 10 years in 2 years. We can't wait for the lease to end to get out.

[emnut]

cashflow is always an issue in small businesses such as these & like a pp said, what appears in books often doesn't turn out to be the reality when operating the business. Also in a business such as this, lack of holidays & family time would be a huge negative for me personally.

ETA the changes you are looking at making would also be quite a large outlay which while they eventually may end up helping to grow the business, initially will be a drain so you would need to be willing to operate at a loss for a while as you recoup those costs.

This post has been edited by emnut: 01/12/2012, 10:10 AM

[WonkieTonkie]

If you're in wa, have a look at bbar cafe in gwelup. A very good example of a dodgy deli turned into a gorgeous cafe. They don't do fruit and vege but they do things like jazz nights, amazing wildfired pizza and excellent breakfasts. People go there for occassions now. It's a fab place and started with just a few tables and takeaway and has boomed!

[JRA]

Most corner stores I know have gone out of business. With 7-11 and supermarkets open all hours now, it is a tough gig for corner stores.

You say local produce, are you in the country?

You also mention overpriced chocolates etc. How would you make them cheaper in the future? You don't have bulk buying power, generally you are buying from a retailer and simply reselling. That costs.


To change the business will cost, as has been said. Getting licence etc for takeaway takes time for health regulations etc.

Good luck

[Stellajoy]

Currently, they only sell your usual over-priced chocolates, soft drinks, and smokes. I would be looking to get in local produce and there is unused takeaway facilities there that could be explored, too. I would also like to stock organic products.

YOU might want to sell organic local produce and local produce...but is there a market for it? will people buy it? how will you compete with the supermarkets?(who also sell organic produce).

If you are now considering a takeaway then thats a completely different business. What facilities exist? (me and DH just bought a cafe/takeaway so could offer advice).

Will you bake your own bread?

If you want some negatives of owning a cafe/takeaway here are some from experience:

staff (ARGGGG...we have only just found good reliable staff..but then can disappear at a moments notice)
To make a small business profitable you will find that a couple both have to work in it and not draw a wage.

Time. as PP said. Doing the books, shopping, deep cleaning (such as deep fryers and combo ovens...these are awesomely suck hole things to clean), baking and cooking, sourcing stock and supplies, are all things that cannot easily be done during opening hours. Be prepared to dedicate a huge amount of time, especially in the beginning.

Cleaning. If you plan on selling food and cooking then imagine you are cooking for 200 people for christmas lunch. then imagine cleaning up after them, including sweeping and mopping every inch of the floor, moving all fridges and ovens out, scrubbing walls, every surface, and dishes. Then do it all again tomorrow...and repeat.

If you are going to turn it into a fancy little cafe...can you cook? most small places could never afford to actually hire a chef/cook and would normally be owner run.

[Stellajoy]

oh yes and the outlay. when we purchased our place we didnt even think that the old owners would obviously leave us with no stock (obviously different in a grocery store where stock may be included) we had to spend $$$$ restocking the simplest things, flour, sauces, rice, cleaning products, it adds up very quickly. on top of this keep in mind that all your equipment will probably break in the first few months.

Learn how to perform maintenance on fridges such as cleaning condensers!