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Hardware Shop Business Plan

Free Business Plan Template

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• Fill in the blanks – Outline
• Financial Tables

How to Write A Hardware Shop Business Plan?

Writing a hardware shop business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan:

1. Executive Summary

An executive summary is the first section planned to offer an overview of the entire business plan. However, it is written after the entire business plan is ready and summarizes each section of your plan.

Here are a few key components to include in your executive summary:

Introduce your Business:

Start your executive summary by briefly introducing your business to your readers.

Market Opportunity:

Products & services:.

Highlight the products you offer your clients. The USPs and differentiators you offer are always a plus.

Marketing & Sales Strategies:

Financial highlights:, call to action:.

Ensure your executive summary is clear, concise, easy to understand, and jargon-free.

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2. Business Overview

The business overview section of your business plan offers detailed information about your company. The details you add will depend on how important they are to your business. Yet, business name, location, business history, and future goals are some of the foundational elements you must consider adding to this section:

Business Description:

• General hardware store
• Specialty hardware store (automotive supplies, construction hardware, etc)
• Online hardware store
• Industrial hardware store
• Plumbing hardware store
• Electrical hardware store
• Describe the legal structure of your hardware store, whether it is a sole proprietorship, LLC, partnership, or others.
• Explain where your business is located and why you selected the place.

Mission Statement:

Business history:.

If you’re an established hardware store, briefly describe your business history, like—when it was founded, how it evolved over time, etc.

Future Goals

This section should provide a thorough understanding of your business, its history, and its future plans. Keep this section engaging, precise, and to the point.

3. Market Analysis

The market analysis section of your business plan should offer a thorough understanding of the industry with the target market, competitors, and growth opportunities. You should include the following components in this section.

Target market:

Start this section by describing your target market. Define your ideal customer and explain what types of services they prefer. Creating a buyer persona will help you easily define your target market to your readers.

Market size and growth potential:

Describe your market size and growth potential and whether you will target a niche or a much broader market.

Competitive Analysis:

Market trends:.

Analyze emerging trends in the industry, such as technology disruptions, changes in customer behavior or preferences, etc. Explain how your business will cope with all the trends.

Regulatory Environment:

Here are a few tips for writing the market analysis section of your hardware shop business plan:

• Conduct market research, industry reports, and surveys to gather data.
• Provide specific and detailed information whenever possible.
• Illustrate your points with charts and graphs.
• Write your business plan keeping your target audience in mind.

4. Products And Services

The product and services section should describe the specific services and products that will be offered to customers. To write this section should include the following:

Hardware products:

Mention the products your business will offer. This list may include product categories like,

• Building materials
• Plumbing materials
• Electrical material
• Safety and protective equipment
• Hardware and fasteners

Mention if your hardware store offers any niche-specific services to the customers.

Quality measures

: This section should explain how you maintain quality standards and consistently provide the highest quality service.

Additional Services

In short, this section of your hardware plan must be informative, precise, and client-focused. By providing a clear and compelling description of your offerings, you can help potential investors and readers understand the value of your business.

5. Sales And Marketing Strategies

Writing the sales and marketing strategies section means a list of strategies you will use to attract and retain your clients. Here are some key elements to include in your sales & marketing plan:

Unique Selling Proposition (USP):

Define your business’s USPs depending on the market you serve, the equipment you use, and the unique services you provide. Identifying USPs will help you plan your marketing strategies.

Pricing Strategy:

Marketing strategies:, sales strategies:, customer retention:.

Overall, this section of your hardware store business plan should focus on customer acquisition and retention.

Have a specific, realistic, and data-driven approach while planning sales and marketing strategies for your hardware shop, and be prepared to adapt or make strategic changes in your strategies based on feedback and results.

6. Operations Plan

The operations plan section of your business plan should outline the processes and procedures involved in your business operations, such as staffing requirements and operational processes. Here are a few components to add to your operations plan:

Staffing & Training:

Operational process:, equipment & machinery:.

Include the list of equipment and machinery required for hardware, such as pipe cutters, pipe threaders, showroom displays, and fixtures, pressure testing equipment, cutting and measuring tools, office equipment, etc.

Adding these components to your operations plan will help you lay out your business operations, which will eventually help you manage your business effectively.

7. Management Team

The management team section provides an overview of your hardware shop’s management team. This section should provide a detailed description of each manager’s experience and qualifications, as well as their responsibilities and roles.

Founders/CEO:

Key managers:.

Introduce your management and key members of your team, and explain their roles and responsibilities.

Organizational structure:

Compensation plan:, advisors/consultants:.

Mentioning advisors or consultants in your business plans adds credibility to your business idea.

This section should describe the key personnel for your hardware store, highlighting how you have the perfect team to succeed.

8. Financial Plan

Your financial plan section should provide a summary of your business’s financial projections for the first few years. Here are some key elements to include in your financial plan:

Profit & loss statement:

Cash flow statement:, balance sheet:, break-even point:.

Determine and mention your business’s break-even point—the point at which your business costs and revenue will be equal.

Financing Needs:

Be realistic with your financial projections, and make sure you offer relevant information and evidence to support your estimates.

9. Appendix

The appendix section of your plan should include any additional information supporting your business plan’s main content, such as market research, legal documentation, financial statements, and other relevant information.

• Add a table of contents for the appendix section to help readers easily find specific information or sections.
• In addition to your financial statements, provide additional financial documents like tax returns, a list of assets within the business, credit history, and more. These statements must be the latest and offer financial projections for at least the first three or five years of business operations.
• Provide data derived from market research, including stats about the hardware industry, user demographics, and industry trends.
• Include any legal documents such as permits, licenses, and contracts.
• Include any additional documentation related to your business plan, such as product brochures, marketing materials, operational procedures, etc.

Use clear headings and labels for each section of the appendix so that readers can easily find the necessary information.

Remember, the appendix section of your retail hardware store business plan should only include relevant and important information supporting your plan’s main content.

The Quickest Way to turn a Business Idea into a Business Plan

Fill-in-the-blanks and automatic financials make it easy.

This sample hardware shop business plan will provide an idea for writing a successful hardware plan, including all the essential components of your business.

After this, if you still need clarification about writing an investment-ready business plan to impress your audience, download our hardware shop business plan pdf .

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Frequently asked questions, why do you need a hardware shop business plan.

A business plan is an essential tool for anyone looking to start or run a successful hardware shop. It helps to get clarity in your business, secures funding, and identifies potential challenges while starting and growing your business.

Overall, a well-written plan can help you make informed decisions, which can contribute to the long-term success of your hardware store.

How to get funding for your hardware shop?

There are several ways to get funding for your hardware shop, but self-funding is one of the most efficient and speedy funding options. Other options for funding are:

• Bank loan – You may apply for a loan in government or private banks.
• Small Business Administration (SBA) loan – SBA loans and schemes are available at affordable interest rates, so check the eligibility criteria before applying for it.
• Crowdfunding – The process of supporting a project or business by getting a lot of people to invest in your business, usually online.
• Angel investors – Getting funds from angel investors is one of the most sought startup options.

Apart from all these options, there are small business grants available, check for the same in your location and you can apply for it.

How do I write a good market analysis in a hardware shop business plan?

Market analysis is one of the key components of your business plan that requires deep research and a thorough understanding of your industry. We can categorize the process of writing a good market analysis section into the following steps:

• Stating the objective of your market analysis—e.g., investor funding.
• Industry study—market size, growth potential, market trends, etc.
• Identifying target market—based on user behavior and demographics
• Analyzing direct and indirect competitors.
• Calculating market share—understanding TAM, SAM, and SOM.
• Knowing regulations and restrictions
• Organizing data and writing the first draft.

Writing a marketing analysis section can be overwhelming, but using ChatGPT for market research can make things easier.

How detailed should the financial projections be in my hardware shop business plan?

The level of detail of the financial projections of your hardware shop may vary considering various business aspects like direct and indirect competition, pricing, and operational efficiency. However, your financial projections must be comprehensive enough to demonstrate a complete view of your financial performance.

Generally, the statements included in a business plan offer financial projections for at least the first three or five years of business operations.

What key components should a hardware shop business plan include?

The following are the key components your hardware shop business plan must include:

• Executive summary
• Business Overview
• Market Analysis
• Products and services
• Sales and marketing strategies
• Operations plan
• Management team
• Financial plan

What's the importance of a marketing strategy in a hardware shop business plan?

Marketing strategy is a key component of your hardware shop business plan. Whether it is about achieving certain business goals or helping your investors understand your plan to maximize their return on investment—an impactful marketing strategy is the way to do it!

Here are a few pointers to help you understand the importance of having an impactful marketing strategy:

• It provides your business an edge over your competitors.
• It helps investors better understand your business and growth potential.
• It helps you develop products with the best profit potential.
• It helps you set accurate pricing for your products or services.

About the Author

Upmetrics Team

Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

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Starting Hardware Store Business Plan (PDF)

Starting a hardware store business is an incredibly lucrative venture, boasting robust profit margins and a constant demand for its products and services. As the backbone of any community’s building and repair needs, hardware stores serve as essential hubs where customers can find a wide range of tools, construction materials, and home improvement supplies. These stores are more than just places to purchase tools, supplies, and building materials—they are hubs of knowledge, expertise, and essential resources for homeowners, contractors, and DIY enthusiasts alike. In an era of rapid urban development and increasing home renovation projects, the hardware store industry remains resilient and holds significant growth potential.

It is projected that the 21 st century will continue to be characterized by concerted construction activities. That stems, in part, from the projected increase in the global population. Plus, regions that have had mostly archaic infrastructure are being upgraded. Governments and the private sector are stepping up property and infrastructure development projects. Overall, residential, commercial, and industrial domains are experiencing a construction boom. For instance, the most sought-after materials right now are concrete, steel, and wood. All these dynamics are creating a huge market for hardware supplies. Thus starting a hardware retail store is bound to be lucrative owing to the ever-expanding market.  This article will outline how to start the hardware store business, and the hardware store business plan – PDF, Word and Excel.

Market Research

Carrying out market research is essential before starting the hardware store business. Market research involves identifying a market for hardware products and services, including important measurable characteristics. Seek to find out the market size for hardware products and services. Whilst doing that find out the popular products or services being offered. Check out up to date hardware industry statistics to help you in those regards. There are usually major players already operating and you should study them. Find out what kind of hardware products and services they offer. Find out about the market shares they own and control. Take time to also evaluate their customer dynamics. All this will help you zone in on a strategic target market. That is why the other area to look into is consumer attributes. What are the general hardware buying habits of consumers in your intended target market? What do they buy, how often, and how much do they spend on average? What are their source of incomes and their average incomes? Whilst you can get ready-made reports on these details, it would be wise to also conduct surveys yourself. You can unearth more details this way. By putting all these together you get a comprehensive understanding of the market. You should ensure that you have a hardware business plan before you venture into this business.

Location And Premises for a Hardware Store

A significant percentage of the demand for hardware products and services stems from the construction industry. So you can identify a location at or near a steadily growing residential area where people are at various stages of constructing their houses. It isn’t enough to only look at the steady growth of such areas alone. These must be people who generally have substantial income levels such that they can afford to buy your products. So that shouldn’t be overlooked because you might regret it later if you don’t find out about it prior.

Your location must be spacious enough to have parking space that adequately accommodates any type of vehicle i.e. for customers and suppliers. The interior of the hardware complex will also have to be spacious with products well arranged in a way that optimizes customers’ buying experience. The road network surrounding or leading to the complex must be well networked and in good shape to promote ease of access for both vehicles and those walking in on foot. Your hardware store business plan should take into account the cost of purchasing or renting premises.

Permits/Licenses, Insurance & Business Bank Account

It depends on where you will be operating from but a hardware store business has to be licensed. In most cases it starts from the basic business or company registration that is mandatory. Then you will usually need a hardware store license. You will also have to be registered with the applicable revenue authority for tax purposes. Other types of permits or licenses might be needed depending on the nature of the hardware products or services you deal with. There are countless risk factors associated with running a hardware store. Your hardware store would need insurance cover for at least general liability, property, crime, and workers. You can get more comprehensive details from reputable insurance providers. In addition to all this you must open a business bank account for your hardware store. Desist from using your personal bank account for your hardware store operations. Having a dedicated business bank account streamlines taxation and bookkeeping. It also presents an authentic brand image. It shields you from business debt liability thus protecting your personal assets. In cases where you need to apply for funding it increases your chances of being considered. Costs of insurance and licenses should be included in your hardware store business plan.

Products for a Hardware Store Business

There’s a very broad range of hardware products that you can sell in your hardware store. Some of the broad categories are agricultural implements, tool sets, protective clothing, building materials, electrical items, plumbing supplies, ironwork materials. So the range of products you can sell is quite diverse e.g. cement, bricks, paint, steel rods (or bars), pipes, adhesives, timber products, door frames, window frames ceramics, various kinds of associated accessories, water reservoirs, glassware, safety shoes, nuts, bolts, nails, screws, work suits, various assortments of hand tools and so on.

Your product range can start relatively small and grow as you add more products informed by recurring customer needs. Earlier we discussed about doing market research because it greatly helps you in knowing what to put in stock. Obviously your hardware store business plan should include money for purchasing the hardware products. Usually as a business person you might be having financial challenges to startup the business so it would be important to know what’s in demand and start off with that.

Inventory Management

Inventory management (or inventory control) refers to the recording and tracking of hardware stock in your store.  Proper inventory management is key to having a profitable hardware store business. The goal is to maintain an optimum number or amount of all inventory items. You should be able to have in stock what a customer seeks. You should be able to detect in good time hardware items that need to be replenished. If this is not properly done it leads to disruptions in sales thus negatively affecting the profitability of your hardware store business. In this day and age you are better off using inventory management software than using manual approaches. The ideal setup is to have an electronic point of sale system or software (EPOS) for your hardware store business. An EPOS with an integrated inventory management function is the best.

Business Model

The business model is the fundamental framework that outlines how a hardware store operates, generates revenue, and creates value for its customers. In the hardware store industry, the most common business model involves the sale of a wide range of tools, building materials, hardware, and related products to both individual consumers and contractors. This model often relies on maintaining an extensive inventory of products to meet the diverse needs of customers. Revenue is primarily generated through the sale of these products, with profit margins varying based on the type of items sold.

To enhance profitability, hardware stores often adopt a mix of strategies. They may offer additional services such as tool rental, key cutting, paint mixing, or even repair services for certain tools and equipment. These supplementary services not only generate additional income but also create a more comprehensive customer experience, making the store a one-stop destination for various hardware-related needs.

In recent years, hardware stores have also embraced digital transformation by establishing an online presence. This allows customers to browse products, check inventory, and place orders online, which can significantly expand the store’s reach and customer base. Some hardware stores may also explore e-commerce as a complementary revenue stream, allowing them to tap into a broader market beyond their physical location. Overall, the hardware store business model continues to evolve to meet the changing needs and preferences of customers while remaining grounded in providing essential products and services for home improvement and construction projects.

Competitive Analysis

Competitive analysis is the assessment of the differences between your hardware store’s performance and that of its competitors. The goal is to detect and examine the factors that cause those differences. In essence you are studying your competition in order to outsmart them. What you unearth from competitive analysis informs your business strategy. Identify who your competitors are and segment them e.g. primary (major focus), secondary, and tertiary. Assess their place or stake in the market. Then do a comparison of what they offer and what you intend to offer. When doing competitive analysis for your hardware store business, you are not just assimilating information. The thrust is to identify market gaps which will be the openings you need. Lacking in skillsets and experience on the current players can be a market gap. You will also get to notice some outstanding pain points consumers still struggle with. Maybe there could be a hardware niche or niches that are underserved – those are market gaps. Regulatory and legislative aspects can also provide insights into market gaps. The marks of a well done competitive analysis will be you identifying market gaps.

Staff And Management

The effective running of a hardware business requires a significant workforce. As a rule of thumb staffing needs are always informed by your intended scale of operations. Some of the key areas in this business are operations management, supply chain management, financial management and inventory management. You’ll need cashiers/till operators, general hands, supervisors, shop attendants and customer attendants as some of the vital components of your operations management team.

The operations team will be central to overseeing the supply chain and inventory management aspects. You must understand that smooth flow of a hardware store business entails consistent monitoring and evaluation of stocks. There’s also a need for a seamless framework for timeous sourcing and receipt of stock from suppliers. Financial accounting is critically important for a hardware business so as to empirically keep track of all transactions.

A hardware shop business also draws more customers when it offers delivery services. Having marketing agents is also strategic because marketing needs serious attention in light of the existence of competitors. As you can see, synching and optimizing all these components together requires a strong and dedicated team. The top management will, depending on scale of operations, constitute of either qualified hired personnel or family members. The hardware business plan should include provisions of salaries for all your workforce.

The major causes of failure of hardware stores include poor financial management resulting in losses. No wonder financial accounting must be thoroughly done when running this business. It’s also encouraged that you conduct stock takes regularly, an exercise that’ll feed into your financial management efforts.

Marketing Plan

Digital marketing must be your biggest focus. Get a website developed for the business to have brand visibility online. Buttress this by setting up active social media accounts on Facebook, LinkedIn, WhatsApp, Instagram and Twitter. Leverage on those platforms’ features such as stories, reels, and status updates to daily send out brand awareness content. Take advantage of print (e.g. fliers, posters, banners) and digital (e.g. e-fliers) media for brand awareness. Aim at exhibiting or being at strategic events such as trade fairs, expos, and the like. Explore options to get featured in strategic publications such as blogs, newspapers, podcasts, radio shows, and so on. Come up with promotionals e.g. discounts. Institute a customer loyalty programme which will be instrumental in boosting word of mouth marketing. Engage social media influencers to tap into large pools of potential customers. Overall, strive to devote at least 5 percent of your revenue towards marketing initiatives. The hardware store business plan should include a proper marketing plan for your business.

Market for Hardware Products

There are several customer sources for a hardware shop. These include building and construction (both new constructing projects and renovations), Do It Yourself (DIY) projects, agriculture industry, electrical and plumbing projects, and maintenance work. Property owners carry out renovations, upgrades, repairs on their properties, and to do that they need hardware products.  Other potential customers for a hardware store business include construction companies, organisations, housing cooperatives, schools, private companies, individuals, farmers and the government.

Keys To Profitability

Starting a hardware store business can be a lucrative venture, but like any other business, success depends on various factors. To ensure profitability in your hardware store, it’s crucial to focus on a few key strategies. First and foremost, effective inventory management is essential. Maintaining the right balance of products, avoiding overstocking or understocking, and regularly reviewing your inventory can help reduce carrying costs and increase your bottom line. Additionally, understanding your target market and offering products that cater to their specific needs and preferences can set you apart from the competition and boost sales. Diversifying your product range is essential. Offering a diverse selection of products, including traditional hardware items, seasonal products, tools, gardening supplies, and home improvement materials, can attract a broader customer base and increase sales opportunities throughout the year. Cost control is another crucial aspect of profitability. Carefully monitor expenses and overhead costs, and regularly review your financial statements to identify areas where you can cut unnecessary spending. Negotiating favorable terms with suppliers, considering bulk purchasing for commonly sold items, can help you secure better pricing on products, increasing your profit margins.

An efficient store layout and visual merchandising are critical. Creating an organized and visually appealing store layout that makes it easy for customers to find what they need can encourage impulse purchases and boost overall sales. Proper signage and strategic product placement can further enhance the shopping experience. Provide exceptional customer service. Customers often return to stores where they receive personalized assistance, expert advice, and a pleasant shopping experience. Well-trained and knowledgeable staff can make a significant difference in customer satisfaction and loyalty. Embracing technology and modernizing your hardware store operations can contribute to profitability. Implementing point-of-sale systems, inventory management software, and an online presence can streamline processes, improve efficiency, and attract a wider customer base. Marketing and promotion are indispensable for drawing customers to your hardware store. Utilize a combination of traditional advertising methods, such as local newspapers and flyers, along with digital marketing techniques like social media, email campaigns, and a user-friendly website. Offering promotions, discounts, and loyalty programs can incentivize repeat business and increase revenue.

Advantages Of A Hardware Store Business

Starting a hardware store business offers several compelling advantages that make it a promising venture in the retail industry. First and foremost, hardware stores benefit from a steady and consistent demand for their products. Whether it’s for routine home maintenance, DIY projects, renovations, or construction work, people rely on hardware stores year-round, providing a reliable customer base that can help stabilize your store’s revenue over time. Providing excellent customer service and a well-stocked inventory can lead to repeat business. Many customers return to hardware stores for ongoing projects, maintenance, or additional supplies. Building a loyal customer base can contribute significantly to long-term success.

Another significant advantage is the diverse product range that hardware stores typically offer. From basic tools and fasteners to power equipment and building materials, these establishments cater to a broad spectrum of customers, including homeowners, contractors, do-it-yourself enthusiasts, and hobbyists. This diversity not only broadens your customer base but also increases sales opportunities, as customers often find a wide array of products under one roof, making their shopping experience more convenient. The business is also very profitable. While individual items may have lower profit margins, hardware stores often make up for it through the volume of sales. High inventory turnover and a consistent flow of customers results in healthy overall profit margins.

Additionally, hardware stores tend to be recession-resistant businesses. During economic downturns, people often prioritize home maintenance and smaller-scale improvement projects, rather than undertaking major renovations or new construction. This inclination toward more modest projects can lead to increased sales for hardware stores, making them relatively resilient in challenging economic times. This stability is a compelling advantage for entrepreneurs looking to invest in a business with long-term sustainability.

Why You Need A Hardware Store Business Plan

A business plan is instrumental in helping you comprehend the profitability of your hardware store business by providing a detailed financial analysis. It outlines the expected revenue streams, including sales projections, pricing strategies, and market demand analysis. Moreover, it delves into the various factors that impact profitability, such as operational costs, volumes sold and markup margins. By quantifying these variables and examining their interplay within the plan, you can gain a comprehensive understanding of the financial landscape, enabling you to make informed decisions, identify potential areas for cost optimization, and ultimately enhance the profitability of your hardware store.

A business plan is also an essential tool for securing funding for your hardware store business. It serves as a detailed blueprint that demonstrates your business’s viability, growth potential, and financial projections to potential investors, lenders, or partners. A well-structured business plan showcases your understanding of the market, competition, and target audience, instilling confidence in financiers about the soundness of your venture. It provides a clear roadmap for how you intend to utilize the funding and achieve your business objectives, giving investors assurance that their investment will be wisely used. In essence, a business plan is your persuasive document that not only attracts financial support but also establishes a sense of trust and credibility, making it a vital tool in securing the funding needed to launch or expand your hardware store.

A comprehensive hardware store business plan is an indispensable asset for those embarking on or expanding their hardware store ventures. It provides clarity of vision, enabling you to define your store’s mission, vision, and objectives clearly. Articulating your business’s purpose and outlining your goals ensures that you and your team are on the same page, working towards a common vision. It also serves as a strategic roadmap, delineating the strategies and tactics essential for your hardware store’s growth and development. This roadmap helps in making informed decisions and acts as a reference point for measuring progress and making necessary adjustments in a dynamic market landscape.

Pre-Written Hardware Store Business Plan (PDF, Word And Excel): Comprehensive Version, Short Funding/Bank Loan Version and Automated Financial Statements

For an in-depth analysis of the hardware store business, we encourage you to purchase our well-researched and comprehensive hardware business plan. We introduced the business plans after discovering that many were venturing into the hardware business without enough knowledge and understanding of how to run the business, lack of understanding of the financial side of the business, lack of understanding of : the industry, the risks involved , costs and profitability of the business; which often leads to disastrous losses.

The StartupBiz Global hardware shop business plan will make it easier for you to launch and run your hardware store business successfully, fully knowing what you are going into, and what’s needed to succeed in the business. It will be easier to plan and budget as you will be aware of all the costs involved in setting up and running the hardware business.

Uses of the Hardware Business Plan (PDF, Word And Excel)

The hardware shop business plan can be used for many purposes including:

• Raising capital from investors/friends/relatives
• Applying for a bank loan
• Start-up guide to launch your hardware retail business
• As a hardware store business proposal
• Assessing profitability of the hardware business
• Finding a business partner
• Assessing the initial start-up costs so that you know how much to save
• Manual for current business owners to help in business and strategy formulation

Contents of the Hardware Store Business Plan (PDF, Word And Excel)

The hardware business plan include, but not limited to:

• Industry Analysis
• Marketing Strategy
• Market Analysis
• Financial Statements (monthly cash flow projections, income statements, cash flow statements, balance sheets, break even analysis, payback period analysis, start-up costs, financial graphs, revenue and expenses, Bank Loan Amortization)
• Risk Analysis
• SWOT & PEST Analysis
• Operational Requirements
• Operational Strategy
• Why some people in the hardware business fail, so that you can avoid their mistakes
• Ways to raise capital to start your hardware store business

The hardware business plan package consists of 4 files

• Hardware Store Business Plan – PDF file (Comprehensive Version – 70 Pages)
• Hardware Shop Business Plan – Editable Word File (Comprehensive Version – 70 Pages)
• Hardware Store Business Plan Funding/Bank Loan Version- Editable Word File (Short version for applying for a loan/funding – 44 pages)
• Hardware Store Business Plan Automated Financial Statements – (Editable Excel File)

The business plan can be used in any country and can be easily edited. The financial statements are automated. This implies that you can change eg the percentage markup, salaries etc, and all the other financial statements will automatically adjust to reflect the change. 

Click below to download the Contents Page of the Hardware Store Business Plan (PDF)

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The business plan which I purchased from your website saved me TIME and MONEY! The layout of the business plan was excellent. The financial statements were detailed and easy for me to edit. I will come back to purchase another business plan soon.

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I was extremely lucky to come across StartupBiz Global. Their business plan exceeded my expectations, and most importantly I was able to secure a loan from my bank. Thank you guys, now my dreams are coming true!

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Just wanted to say I am very happy with the business plan and I will gladly recommend your products, thank you very much and have a great day.

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StartupBiz Global provided a very professional and comprehensive business plan which I used for my business. The business plan was easy to edit, and I was able to get the funding which I wanted. I highly recommend their business plans.

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I purchased a business plan from you, and I’m glad to inform you that I was able to get my loan, and I’m starting my poultry farming business on the 1 st of July. This was made possible because of your business plan. Thank you very much, you made my dream come true.

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Many thanks for your incredibly efficient service and thorough business plan. I am very impressed with the business plan. Before I bought the business plan, I tried to do my own business plan – it was such a nightmare and it turned out badly, also not to mention the stress it caused me. I wish I knew about your website earlier!

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I found Startupbiz Global online when I was in desperate need of a business plan. I was overwhelmed by the quality of the business plan, it’s comprehensive and well researched! I did not have to wait to get the business plan, I got it instantly after payment. I highly recommend Startupbiz Global, and would happily use them again in the future.

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I was able to understand the business side of farming because of your business plan. You did extensive research; the business plan was well prepared and fully detailed.  It made everything clear, and I have somewhere to start now. I am confident that I am going to succeed in my business because of the guidance from your business plan.

Get the Hardware Business Plan (PDF, Word And Excel)

Click Buy Now  below to purchase using Paypal, Credit Card, or Debit Card. After you have purchased, you will immediately see the download link for the business plan package on the screen. You will also immediately get an email with the business plan download link. The Pre-written business plan package (PDF, Word, and Excel) costs $30 only!

If you want to purchase multiple business plans at once then click here: Business Plans Store.

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How to Start a Hardware Store in 5 Steps

Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money .

Starting a hardware store — a brick-and-mortar shop that sells, essentially, brick and mortar (and everything else you need to build a house, fix a leaky faucet, or paint the garage) — might seem daunting in this day and age.

Smaller hardware stores, like small businesses in every industry, face cutthroat competition, not just from other local businesses but big box stores like Home Depot and e-commerce giants like Walmart and Amazon.

But if you have the expertise and passion for opening a hardware store, don’t get discouraged. You can actually control a number of factors to maximize your potential for success. Review these five steps in how to start a hardware store before you get your business started to see if you have a good shot at staying afloat.

What you need to know about starting a hardware store

According to IBISWorld, there are nearly 20,000 hardware stores in the United States today, producing about $24 billion in revenue and employing just over 148,000 people.

Its analysis of the industry is in line with something you may have noticed if you’re interested in getting into the business: As the economy has improved over the last five years, the housing market has strengthened, leading to an increase in the number of home improvement projects that require trips to the hardware store.

Additionally, low mortgage rates have encouraged people to buy and renovate homes, putting countrywide brands like True Value and Ace Hardware in a good position to capitalize.

The report does note that hardware store growth is expected to slow a bit in the next five years, but the overall industry does have a positive outlook.

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We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

How to start a hardware store in 5 steps

1. decide between opening your own hardware store or starting a franchise.

There are lots of completely independent hardware stores around the country, catering to the ultra-local community. If you’ve identified a market where you feel you can think about starting a hardware store and become the near-exclusive provider for — and if you’re a control freak who wants to make 100% of the decisions about how your business operates — you might feel good about opening your own shop. Starting a hardware store on your own also requires less money.

There is, however, another option: starting a hardware store with a popular franchise , which provides you access to an established name, as well as a proven operational model and efficient supply chain. You can still be the owner of the store with plenty of latitude to make business decisions.

That’s the situation at Waverly Ace Hardware in Baltimore, Maryland, which is part of an independently run co-op within the fold of Ace Hardware stores.

According to Michael Marren, the assistant manager of one of the 11 Waverly Ace Hardware stores across Maryland, Washington, D.C., and northern Virginia, the relationship between the store and the parent company is helpful and fruitful.

“Our parent, A Few Cool Hardware Stores LLC, is based out of the District, and the name denotes the company philosophy rather well. We're a small business, our leadership is independent and local — but we have the benefit of Ace's logistical umbrella,” he says.

For example, Marren says that his company offers “well above minimum wage” and “a robust benefits package,” which he notes is a distinct choice that makes employees happier.

It’s also nice when you’re starting a hardware store within an established franchise to have a supply chain and the logistics of running the store all ready for you to utilize, rather than figuring it out on your own.

2. Write a business plan

Whether you go with a brand or strike out on your own, you should have a business plan that details how you’ll put your hardware store in the best position to succeed.

Important things to cover include:

Knowing your customer: What does your typical customer look like? Are they DIY landlords and contractors, or homeowners doing pet projects? Depending on who you’ll be catering to, the way your store is designed and the weight of your stock will change.

What your finances look like: How much do you need to start up? Once you do get going, what is your break-even point? What do you expect your cash flow to be like on a monthly basis? If you’re joining an established brand, IBISWorld notes you need a minimum of $150,000 unencumbered cash available for investment in a True Hardware, while Ace requires between about $820,000 and $1.5 million — the total depends on how big your store will be and other factors.

Your marketing plan: If you join a national brand, you’ll have access to all kinds of programs and events you can use to boost your profile. But you should also consider local, perhaps even offline marketing campaigns, loyalty programs for repeat customers and a flexible national catalog program.

Location: This one is a no-brainer. You’ll want somewhere with a lot of foot traffic that doesn’t cannibalize the business of other stores — or put you in a position to be cannibalized in return.

3. Invest in supplies and excellent customer service

According to IBISWorld, the three most important factors for success are the ability to control stock on hand, an experienced workforce and having a loyal customer base.

These are sentiments that Marren echoes when discussing why people come to his hardware store, as opposed to shopping online with Amazon or hitting a big box store.

“In my view, people come to us for interaction, information, personalization, and proximity. We're closer, friendlier, and we'll actually help you when you come in,” he says.

But even the friendliest store associates can’t do anything for customers if what the customers need isn’t in stock.

“The first rule of customer service is having the thing that someone wants to buy,” says Marren. “Invest in inventory and point of sale software that can analyze the stock and keep your inventory responsive.”

IBISWorld says that challenges to starting a smaller hardware store revolve around competition — mainly those larger retailers and home improvement stores. Marren agrees, noting that bigger stores have an economy of scale that gives them an edge.

So, if you can’t beat the bigger stores on price, you need to beat them with better, more helpful, happier employees. Keeping those employees happy (e.g., with the benefits package Marren described) will go a long way toward gaining the loyalty and quality effort you need to succeed.

4. Obtain the necessary permits, insurance and a business bank account

You’ll need to register your business with your secretary of state, apply for a business tax identification number (also known as an employer identification number, or EIN) from the IRS, and open a business checking account .

Establish revolving lines of credit with your hardware distributors as well as with your financiers, if you have them, whether they are traditional banks or online lenders.

Depending on where you’re setting up shop, you may need specific local, state and city permits — and you might want to visit with an attorney or accountant familiar with local standards to make sure you’re in compliance.

Finally, get the right business insurance: If you have employees (and it’s doubtful you’ll be running one of these stores all on your own), you need workers' compensation insurance — a commercial insurance policy that covers the store inventory against loss or injury claims from customers.

Start Your Dream Business

5. Adapt your inventory, marketing and staffing

Your hardware store will hardly be a static entity. As the homeownership market changes, the seasons shift, or new challenges (and challengers) enter the scene, you’ll need to adapt your inventory, marketing campaigns, and staffing needs.

What should remain consistent is that you:

Continue to maintain inventory levels so that you’re never out of stock at a crucial moment.

Your commitment to keeping your staff informed and engaged is unwavering.

Always look to growth within your niche rather than overextending yourself.

As Marren puts it: “We take a more ecological view of the market — we fit a niche. We're not in the business of putting other local stores out of business.”

After all, since you’re starting a hardware store, you’re in the business of helping people improve their homes, and by extension, their lives. Conduct your business appropriately.

On a similar note...

How To Write a Business Plan for Hardware Store in 9 Steps: Checklist

By alex ryzhkov, resources on hardware store.

• Financial Model
• Business Plan
• Value Proposition
• One-Page Business Plan
• SWOT Analysis
• Business Model
• Marketing Plan

If you're considering opening a hardware store in the US, you've chosen a promising industry to enter. The hardware retail market has been steadily growing, with a projected revenue of $44 billion in 2021, representing a 3.4% increase from the previous year. With the right business plan in place, you can maximize your chances of success in this thriving market. In this blog post, we'll guide you through the nine essential steps to write a business plan for a hardware store that stands out from the competition.

Step 1: Conduct market research to identify trends, consumer preferences, and potential niche markets that your hardware store can tap into. Understanding the demand and supply dynamics of the industry will help you make informed decisions as you navigate the market.

Step 2: Identify your target market and competition . Determine who your ideal customers are and analyze the existing hardware stores in your area. Identifying gaps in the market and differentiating your store will be crucial to attracting and retaining customers.

Step 3: Develop a comprehensive business concept . Define your store's unique selling proposition, which could include offering a wide range of niche and specialty hardware products, providing consulting services, or hosting workshops to teach DIY skills. Tailor your concept to meet the needs of your target market.

Step 4: Create a detailed financial plan to estimate the startup costs, revenue projections, and profitability of your hardware store. This will help in securing funding and determining the feasibility of your business idea.

Step 5: Determine the store location and layout . Choose a location that is easily accessible to your target market and ensure your store layout is designed for optimal customer experience and efficient operations.

Step 6: Create a marketing and advertising strategy to attract customers to your store. Utilize both online and offline channels to promote your unique products and services, showcase your expertise, and engage with your target audience.

Step 7: Develop a staffing plan . Determine the number and types of employees you will need to run your hardware store efficiently. Provide relevant training and create a positive work environment to ensure employee satisfaction.

Step 8: Establish supplier relationships to ensure a reliable and diverse range of products for your store. Identify reputable suppliers who can meet your inventory needs and negotiate favorable terms.

Step 9: Obtain necessary licenses and permits to comply with the legal requirements of operating a hardware store. Research the specific permits and licenses required in your area and ensure you have all the necessary documentation in order.

By following these nine steps, you'll be well-equipped to write a comprehensive business plan for your hardware store that sets you up for success in the competitive market. With a focus on niche and specialty products, excellent customer service, and a well-executed marketing strategy, your hardware store can become a trusted destination for customers seeking specific tools and materials.

Conduct Market Research

Conducting thorough market research is an essential first step when developing a business plan for a hardware store. This research will provide valuable insights into the demand for hardware products in your target market, as well as the competitive landscape and potential consumer preferences. It will help you make informed decisions and identify opportunities for differentiation.

In order to effectively conduct market research, consider the following steps:

• Identify your target customers: Determine the demographic characteristics of your ideal customers, such as age, gender, income level, and geographic location. This will help you understand their needs and preferences.
• Assess the market size and potential: Analyze the overall market demand for hardware products in your area. Look for trends, such as population growth, housing development, or upcoming construction projects that could impact the demand for hardware products.
• Analyze the competition: Identify existing hardware stores in your target market and assess their strengths, weaknesses, and market positioning. This will help you identify any gaps in the market that your store can fill.
• Identify unique selling points: Determine what sets your hardware store apart from the competition. Consider offering niche products, specialty services, or providing exceptional customer service.
• Understand consumer preferences: Conduct surveys or interviews to gather insights into the specific hardware products and services that potential customers are seeking. This will help you tailor your offerings to meet their needs.

Tips for conducting market research:

• Use a combination of primary and secondary research: Primary research involves collecting data directly from potential customers through surveys or interviews, while secondary research involves analyzing existing market reports, industry publications, and online resources.
• Consider hiring a market research firm: If you have the budget, hiring a professional market research firm can provide you with more comprehensive and reliable data.
• Stay up to date with industry trends: Continuously monitor industry trends, new technologies, and emerging market opportunities to stay ahead of the competition.

By conducting thorough market research, you will gain valuable insights into the demand for hardware products in your target market, enabling you to develop a business plan that meets the needs of your customers and sets you apart from your competitors.

Identify Target Market And Competition

Identifying the target market and understanding the competition is a crucial step in developing a successful business plan for a hardware store. By thoroughly analyzing the market and researching the existing competition, you can tailor your offerings to meet the needs of your target customers and differentiate your store from competitors in the industry.

When identifying your target market, consider factors such as demographics, psychographics, and geographic location. Determine who your ideal customers are, their preferences, and their purchasing habits. This will help you develop a clear understanding of the specific needs and preferences of your target market.

Additionally, research and analyze the competition in the hardware retail industry. Identify other hardware stores in your area, both large chains and smaller independent businesses. Understand their strengths, weaknesses, and the products and services they offer. This will allow you to identify any gaps in the market that you can capitalize on and help you differentiate your store from the competition.

• Tip 1: Conduct surveys or interviews with potential customers to gain insights into their needs and preferences.
• Tip 2: Use market research tools and industry reports to gather data on market trends, customer behavior, and competitor analysis.
• Tip 3: Leverage social media and online platforms to monitor and analyze customer feedback and reviews of existing hardware stores in your area.
• Tip 4: Stay updated on industry news and trends through trade publications and attending relevant conferences or events.

Develop A Comprehensive Business Concept

Developing a comprehensive business concept is a crucial step in creating a successful hardware store. This step requires careful consideration of various factors that will shape the overall direction and focus of your business. Here are some important aspects to consider:

• Identify your niche: Determine the specific niche or specialty hardware products you want to offer. Consider market demand and the unique needs of your target audience. This will help differentiate your store and attract a loyal customer base.
• Define your value proposition: Clearly articulate what sets your hardware store apart from competitors. Is it the convenience of finding hard-to-find items? The expertise of your staff? The additional services you provide? Understanding and emphasizing your unique selling points will help you stand out in the market.
• Consider additional services: Think beyond just selling products. Explore opportunities to provide consulting services, workshops, or classes that teach DIY skills. These additional offerings can enhance customer engagement and loyalty.
• Embrace technology: In today's digital age, integrating technology into your business concept can boost efficiency and customer experience. Consider offering online ordering, delivery services, or a user-friendly website and mobile app.
• Create a customer-centric experience: Think about how you can create a personalized and remarkable experience for your customers. This could involve offering expert advice, hosting events, or creating a welcoming and visually appealing store layout.
• Stay updated with the latest hardware trends and innovations.
• Regularly seek feedback from customers to identify areas for improvement.
• Stay flexible and adapt your business concept based on evolving customer needs.
• Keep a close eye on industry competitors to stay ahead of the curve.
• Engage with industry associations and networks to stay informed and connected.

By thoroughly developing a comprehensive business concept, you lay the foundation for a hardware store that meets the unique needs of your target market and stands out from the competition. This step serves as a guiding framework for all other aspects of your business plan, ensuring that every decision aligns with your overall vision and objectives.

Create A Detailed Financial Plan

A detailed financial plan is crucial for the success of your hardware store. It will help you understand the financial viability of your business idea and guide your decision-making process. Here are some important steps to consider when creating your financial plan:

• Estimate start-up costs: Calculate the initial expenses required to launch your hardware store. This may include purchasing inventory, leasing a space, renovating the store, obtaining equipment, and hiring staff. Be sure to factor in both one-time and ongoing costs.
• Project sales forecasts: Research the market demand for hardware products in your area and analyze your target market. Based on this information, estimate your expected sales for each product category. Consider seasonal variations and potential growth opportunities.
• Calculate operating expenses: Determine all the costs associated with running your hardware store, such as rent, utilities, salaries, insurance, and marketing. Break down these expenses on a monthly or quarterly basis to get an accurate picture of your ongoing financial obligations.
• Forecast cash flow: Create a cash flow projection to track the inflows and outflows of your finances. This will help you assess how much cash you will have available at any given time and identify any potential cash flow gaps. It's essential to have enough working capital to cover day-to-day expenses.
• Set pricing and profit margins: Analyze your costs, competition, and market demand to determine the pricing strategy for your hardware products. Consider your desired profit margins while ensuring your prices remain competitive. Regularly review and adjust your pricing strategy based on market trends and customer demand.
• Identify funding sources: Determine how you will finance your hardware store. Explore options such as personal savings, loans from financial institutions, or partnerships with investors. Prepare a detailed plan to present to potential lenders or investors to demonstrate the potential profitability and return on investment.

Tips for Creating a Detailed Financial Plan:

• Utilize accounting software or hire an experienced accountant to assist in creating accurate financial projections and monitoring your finances.
• Regularly review and update your financial plan as your business evolves and market conditions change.
• Consider seeking advice from mentors or industry experts who can provide insights into financial management and planning for a hardware store.
• Include a contingency plan for unexpected expenses or fluctuations in sales.
• Keep track of key performance indicators (KPIs) such as inventory turnover, gross profit margin, and return on investment to assess your store's financial health.

Determine The Store Location And Layout

Choosing the right location for your hardware store is crucial to its success. The store should be easily accessible to your target market and strategically positioned to attract customers. Consider factors such as visibility, proximity to residential areas or other businesses, and the level of competition in the area. Additionally, the layout of your store plays a significant role in creating an inviting and functional space for both staff and customers.

When determining the store location, conduct thorough research on various potential sites. Look for areas with a high demand for hardware products and a customer base that aligns with your target market. Consider factors such as foot traffic, parking availability, and proximity to complementary businesses that could attract potential customers.

Tips for determining the store location:

• Visit the potential locations during different times of the day to gauge the amount of foot traffic and overall activity in the area.
• Research local zoning regulations and ensure the selected location complies with all necessary requirements for running a retail business.
• Consider the availability and cost of utilities, such as water, electricity, and internet connectivity, as this can impact your operational costs.
• Take into account the potential for expansion or future renovations, as your store may need to adapt to changing customer demands.
• Work with architects or store designers to create an efficient layout that maximizes product visibility, facilitates easy navigation, and allows for effective merchandising.

Once you have selected a suitable location, focus on devising an optimal store layout. Take into account the available square footage, the type and volume of products you plan to stock, and the overall flow of customers within the store. Place often-required items in prominent areas and ensure that aisles and pathways are wide enough to accommodate shopping carts or customers with mobility aids.

Additionally, consider creating designated areas for workshops, consultations, or product demonstrations, if they are part of your business concept. These interactive spaces provide opportunities for customers to engage with your store and its offerings, fostering a sense of community and increasing the likelihood of repeat visits.

Remember, the store location and layout should not only be aesthetically pleasing but also functional, efficient, and aligned with your overall business goals and target market preferences.

Create A Marketing And Advertising Strategy

Marketing and advertising are essential components of a successful business. A well-planned strategy will help you generate awareness, attract customers, and ultimately increase sales. Here are some key steps to consider when creating your marketing and advertising strategy for your hardware store:

• Identify your target market: Before you can effectively market your hardware store, it's important to understand who your target audience is. Consider demographics such as age, gender, location, and interests. This will help you tailor your marketing efforts to reach the right people.
• Determine your unique selling proposition: What sets your hardware store apart from the competition? Whether it's your wide range of niche products or your exceptional customer service, identify your unique selling proposition and highlight it in your marketing materials.
• Utilize a multi-channel approach: To reach a wider audience, consider using a combination of marketing channels such as print advertising, social media, email marketing, and local networking. This will allow you to connect with customers both online and offline.
• Create a strong online presence: In today's digital age, having an online presence is crucial. Build a user-friendly website that showcases your products and services, and optimize it for search engines to increase your visibility. Engage with your audience through social media platforms like Facebook, Instagram, and Twitter.
• Offer promotions and discounts: People love a good deal, so consider offering promotions, discounts, or loyalty programs to incentivize customers to choose your hardware store over competitors. This can help you attract new customers and retain existing ones.
• Consider partnering with local contractors or DIY bloggers to generate buzz and credibility.
• Host workshops or classes that teach DIY skills to not only generate additional revenue but also establish yourself as an expert in the field.
• Monitor and analyze the success of your marketing efforts. Use tools like Google Analytics to track website traffic and social media insights to evaluate engagement levels.

Develop A Staffing Plan

One of the key factors in running a successful hardware store is having a knowledgeable and skilled staff to assist customers and provide expert guidance. Developing a staffing plan is crucial to ensure you have the right team in place to meet the needs of your business and customers.

Here are some important steps to follow when creating a staffing plan:

• Identify the necessary roles: Start by identifying the different roles you need in your hardware store, such as sales associates, product experts, cashiers, and customer service representatives. Consider the specific skills and experience required for each position.
• Determine staffing levels: Assess the expected demand for your products and services to determine the number of employees needed to adequately serve your customers. Consider factors such as peak hours or seasons when determining staffing levels.
• Recruitment and hiring: Develop a strategy for recruiting and hiring employees. This may include advertising job openings, conducting interviews, and checking references. Look for individuals who have a passion for hardware and possess excellent customer service skills.
• Training and development: Once you have hired your staff, provide thorough training to ensure they have a strong understanding of the products and services offered in your hardware store. Continuously invest in their development through workshops, seminars, or online training programs.
• Scheduling: Establish a clear and fair scheduling system to ensure adequate coverage during all operating hours. Consider implementing flexible working arrangements to accommodate employee preferences and maintain employee satisfaction.
• Performance management: Set clear performance expectations and provide regular feedback to your staff. Establish a system for monitoring and evaluating employee performance, recognizing outstanding work, and addressing any performance issues promptly.
• Consider hiring employees with diverse skill sets and areas of expertise to cater to a wide range of customer needs.
• Offer employee benefits and incentives to attract and retain top talent, such as competitive wages, health insurance, or employee discounts.
• Promote a positive work environment by fostering open communication, teamwork, and mutual respect among your staff.

By developing a comprehensive staffing plan, you can ensure that your hardware store has a capable and dedicated team to provide excellent customer service and support the success of your business.

Establish Supplier Relationships

Once you have identified your target market and developed a comprehensive business concept, it's time to start building relationships with suppliers who will provide the products you need to stock your hardware store. These suppliers play a crucial role in the success of your business, as they will ensure a steady supply of high-quality items that meet the needs and demands of your customers.

Here are some essential steps to establish strong supplier relationships for your hardware store:

• Research potential suppliers: Start by researching potential suppliers who specialize in the type of niche and specialty hardware products you plan to offer. Look for suppliers who have a reputation for delivering quality products on time.
• Reach out and make contact: Once you have identified potential suppliers, reach out to them and express your interest in establishing a business relationship. Introduce yourself, briefly explain your business concept, and inquire about their product offerings and pricing.
• Compare pricing and terms: It's important to compare pricing and terms among different suppliers to ensure you are getting the best value for your money. Consider factors such as minimum order quantities, payment terms, and shipping costs.
• Negotiate contracts: Once you have selected the suppliers you wish to work with, negotiate contracts that outline the terms and conditions of the partnership. This may include pricing agreements, delivery schedules, and any additional services or support the suppliers can provide.
• Build a mutually beneficial relationship: As you begin working with your suppliers, focus on building a mutually beneficial relationship. Communicate regularly, provide feedback on their products, and address any concerns or issues promptly. This will help foster a strong and reliable partnership.
• Diversify your supplier base: It's important to avoid relying too heavily on a single supplier, as this can pose a risk to your business if any issues arise. Consider working with multiple suppliers to ensure a diverse and reliable supply chain.

Helpful Tips:

• Attend trade shows and industry events to network with potential suppliers and stay updated on the latest products and trends in the hardware industry.
• Consider collaborating with local manufacturers or artisans to offer unique, locally-made products in your store.
• Regularly evaluate your supplier relationships to ensure they continue to meet your business needs and explore new opportunities for potential partnerships.

Obtain Necessary Licenses And Permits

When opening a hardware store, it's essential to obtain the necessary licenses and permits to ensure compliance with local and state regulations. Failure to do so can result in legal consequences and disruptions to your business operations. Here are some key licenses and permits you should consider:

• Business License: Obtain a business license from your city or county government. This license allows you to legally operate a hardware store and ensures you meet the requirements set by local authorities.
• Sales Tax Permit: Apply for a sales tax permit to collect and remit sales tax to the appropriate government agency. This permit is necessary for conducting retail sales and ensures you comply with tax regulations.
• Building Permits: If you plan to make any structural changes or renovations to your store location, you may need to obtain building permits. These permits ensure that your construction work meets safety and zoning regulations.
• Occupancy Permit: Depending on your local jurisdiction, you may need an occupancy permit to operate your hardware store. This permit certifies that your store complies with fire, health, and safety codes.
• Sign Permit: If you intend to display signage for your hardware store, check if you need a sign permit. This permit regulates the size, location, and design of your storefront sign.
• Environmental Permits: Some hardware stores may need environmental permits if they handle or sell hazardous materials, such as paints or chemicals. These permits ensure proper handling, storage, and disposal of such substances.
• Trade Licenses: Depending on the services you plan to offer, such as heating and cooling repairs or locksmith services, you may need specialty trade licenses. These licenses demonstrate your qualifications and knowledge in specific areas.

Tips for Obtaining Licenses and Permits:

• Research local regulations: Familiarize yourself with the licensing and permit requirements specific to your location. Contact your local government offices or visit their websites to gather information.
• Allow ample time: The process of obtaining licenses and permits can take time, so start early to avoid delays in your store's opening.
• Seek professional advice: Consider consulting with an attorney or a business advisor who specializes in licensing and permits to ensure you complete the necessary requirements correctly.
• Maintain compliance: Once you have obtained the licenses and permits, make sure to comply with any ongoing reporting or renewal requirements to avoid penalties or license revocation.

Writing a business plan for a hardware store is an essential step towards success. By following the nine steps outlined in this checklist, you can ensure that your business is well-prepared and positioned for growth. By conducting thorough market research, identifying your target market and competition, and developing a comprehensive business concept, you can create a strong foundation for your hardware store.

Creating a detailed financial plan, determining the store location and layout, and establishing supplier relationships are critical for operational efficiency and cost-effectiveness. By developing a marketing and advertising strategy, you can effectively reach your target audience and differentiate your store from competitors.

Furthermore, developing a staffing plan and obtaining necessary licenses and permits are important for smooth day-to-day operations and legal compliance. By considering these factors and implementing them into your business plan, you can set your hardware store up for long-term success.

Remember, a hardware store that focuses on providing niche and specialty hardware products, along with additional services like consulting and DIY classes, can attract a loyal customer base. By offering convenience, expertise, and unique products, you can position your store as a go-to destination for customers seeking specific tools and materials.

Writing a business plan for your hardware store may seem like a daunting task, but by breaking it down into these nine steps and using this checklist, you can create a well-thought-out plan that sets your business up for growth and success.

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How to Start a Profitable Hardware Business [11 Steps]

By Nick Cotter Updated Feb 02, 2024

Business Steps:

1. perform market analysis., 2. draft a hardware business plan., 3. develop a hardware brand., 4. formalize your business registration., 5. acquire necessary licenses and permits for hardware., 6. open a business bank account and secure funding as needed., 7. set pricing for hardware services., 8. acquire hardware equipment and supplies., 9. obtain business insurance for hardware, if required., 10. begin marketing your hardware services., 11. expand your hardware business..

Beginning a hardware business requires a comprehensive understanding of the market landscape to identify opportunities and challenges. A market analysis will enable you to gauge demand, competition, and potential customer base. Here’s how to proceed:

• Research your target market by collecting data on demographics, spending habits, and needs to understand who your customers are and what they're looking for.
• Analyze local and regional competitors to assess their product offerings, pricing, strengths, and weaknesses to find your unique selling proposition.
• Investigate industry trends and future predictions to align your business strategy with where the market is headed.
• Utilize government and industry reports for statistics and market insights that can help in making informed decisions.
• Conduct surveys, focus groups, or interviews with potential customers to get direct feedback on their preferences and willingness to purchase.
• Assess suppliers and distributors to determine the best partners for your business in terms of quality, cost, and reliability.
• Examine regulatory requirements to ensure compliance with local, state, and federal laws that may affect your business operations.

Are hardware businesses profitable?

Yes, hardware businesses can be highly profitable. When done properly, hardware businesses can earn a significant return on investment with relatively low overhead costs. Successful hardware businesses typically focus on expensive, high-end products with a large market and strong demand, or on niche products with high margins and loyal customers.

Starting a hardware business requires careful planning and a solid business plan. This document will serve as your roadmap, outlining the strategies for success, financial projections, and the structure of your business. Below is a guide to drafting an effective hardware business plan.

• Begin with an executive summary that encapsulates your business goals, target market, and competitive advantages.
• Define your business structure, including ownership, management team, and operational strategy.
• Conduct a market analysis to understand your competition, identify your customer base, and determine market trends.
• Outline your product line, detailing the types of hardware you will offer, your suppliers, and your inventory management system.
• Develop a marketing and sales strategy that includes pricing, promotions, sales channels, and customer service.
• Provide detailed financial projections, including start-up costs, revenue forecasts, profit and loss estimates, and cash flow analysis.
• Address any regulatory requirements, licensing, and insurance needed to operate legally and safely.
• Include an appendix for supporting documents, such as resumes of the management team, legal agreements, and detailed market research data.

How does a hardware business make money?

Hardware businesses make money by selling tools and supplies to their target customers. For example, a hardware business selling supplies and equipment needed for an air duct cleaning business might target professional residential cleaners and commercial building owners. This hardware store could offer a variety of items such as brushes, vacuums, hoses, seals and special chemicals needed for air duct cleaning. With a wide selection of items available at competitive prices, the store would be able to attract customers looking for quality supplies for their air duct cleaning business.

Creating a strong and recognizable hardware brand is crucial for your business success. It's about more than just a logo; it's about building a reputation for quality, reliability, and innovation that resonates with your target audience. Here's how to develop a hardware brand:

• Define Your Unique Selling Proposition: Identify what makes your hardware products stand out from the competition. Emphasize these features in your branding to attract customers.
• Choose a Memorable Name and Logo: Select a brand name and design a logo that is easy to remember, yet reflects the quality and reliability of your hardware products.
• Establish Brand Values and Personality: Decide on the core values and personality of your brand. Are you innovative, eco-friendly, or customer-centric? Let these values guide your interactions and communications.
• Create a Consistent Visual Identity: Use consistent colors, fonts, and design elements across all marketing materials to create a cohesive look that customers will recognize.
• Promote Your Brand Story: Share the story behind your brand, including the inspiration for starting your hardware business and your vision for the future, to create a personal connection with your customers.
• Engage with Your Audience: Build relationships with your customers through social media, customer service, and community engagement to foster brand loyalty.

How to come up with a name for your hardware business?

Coming up with a name for your hardware business can be exciting yet overwhelming. It is important to consider the overall purpose of your business, what type of hardware you intend to offer, and your target audience when selecting a name. Research existing businesses in the industry, as well as potential names to ensure you don't select something that is already in use. When selecting a memorable and catchy name, try to involve a compelling story or feature of the business within it. Lastly, make sure you research potential trademark issues related to the name prior to finalizing it.

Registering your hardware business is a critical step that will legitimize your venture and enable you to operate legally. This process varies depending on your location, but generally involves a few key steps to ensure that your business is compliant with local laws and regulations. Follow these guidelines to formalize your business registration:

• Choose a unique business name and check its availability with your government's business registry to ensure that it's not already in use.
• Decide on a legal structure for your business (sole proprietorship, partnership, LLC, corporation, etc.) as this will determine your liabilities, tax obligations, and the amount of regulatory paperwork required.
• Obtain an Employer Identification Number (EIN) or the equivalent in your country, which is necessary for tax purposes and to open a business bank account.
• Register your business with the local or state government to get a business license or permit, as required for hardware stores. Check for specific hardware business regulations in your area.
• Consider any additional licenses or permits specific to the hardware industry, such as those related to selling certain types of equipment or handling hazardous materials.
• Keep all registered documents and certifications accessible as you may need to present them for various business activities and banking procedures.

Resources to help get you started:

Explore critical resources designed for hardware entrepreneurs looking for market trends, operational best practices, and strategic business growth tips:

• Crunchbase: A comprehensive platform for discovering industry trends and tracking startups and investments. https://www.crunchbase.com
• CB Insights: Offers in-depth reports and analyses on various sectors, including hardware, to understand market dynamics. https://www.cbinsights.com
• Make: Magazine: Provides a blend of hardware project ideas, DIY guides, and business tips for hardware startups. https://makezine.com
• Hackaday: A community and blog for hardware hackers, offering insights on emerging hardware trends, projects, and tips. https://hackaday.com
• Hardware Massive: A global platform and community for hardware startups featuring events, webinars, and networking opportunities. https://hardwaremassive.com
• The Hardware Startup: Building Your Product, Business, and Brand: A book offering strategic advice on launching a hardware startup, from prototyping to scaling. Available on Amazon.

Starting a hardware business involves navigating through various regulations to ensure compliance with local, state, and federal laws. Acquiring the necessary licenses and permits is a critical step to legally operate your business and avoid any potential fines or legal issues. Below is a guide to help you through this process:

• Research local business licenses: Contact your city or county government to determine the specific business licenses required to operate a hardware store in your area.
• Obtain a sales tax permit: If your state collects sales tax, you will need to register for a sales tax permit with your state's Department of Revenue or equivalent authority.
• Check for specialized permits: Depending on the products you sell, you may need additional permits, such as those for selling hazardous materials or operating heavy machinery.
• Apply for an Employer Identification Number (EIN): If you plan to hire employees, you'll need an EIN from the IRS for tax purposes.
• Ensure zoning compliance: Verify that your business location is zoned for retail and specifically hardware sales.
• Comply with environmental regulations: Hardware stores often deal with chemicals and substances that require adherence to environmental safety standards set by the EPA or state agencies.
• Stay informed about renewals: Keep track of when each license or permit expires and the process for renewal to maintain continuous compliance.

What licenses and permits are needed to run a hardware business?

To run a hardware business, you will need to obtain various types of licenses and permits, such as a business license, zoning permit, tax license, special permits for hazardous materials and air quality, building permit, seller's permit, and health and safety permits. Additionally, depending on the type of products being sold, specialty licenses may be required for things like firearms or flammable materials. It is important to research the specific requirements for your area to ensure that your business is in compliance with all local, state and federal regulations.

Starting a hardware business requires careful financial planning and management. A crucial step in this process is opening a business bank account to keep your personal and business finances separate. Additionally, securing the necessary funding to cover your startup costs and operational expenses is vital for the success of your business. Follow these guidelines:

• Research banks that offer business banking services and compare their account options, fees, and features to find the best fit for your hardware business.
• Prepare the required documentation, which typically includes your business registration papers, EIN (Employer Identification Number), and personal identification.
• Open your business bank account by visiting a branch or completing the process online, depending on the bank's offerings.
• Explore various funding options such as small business loans, lines of credit, investor funding, or crowdfunding platforms to raise the capital needed.
• Prepare a solid business plan to present to potential lenders or investors, highlighting your business model, market analysis, financial projections, and how you intend to use the funds.
• Consider the Small Business Administration (SBA) loans or local grants for new businesses, which might offer more favorable terms for startups.

Establishing the right pricing for hardware services is crucial for the success of your hardware business. It's important to find a balance that reflects the value of your services while staying competitive in the market. Consider the following points as you set your pricing:

• Cost-Plus Pricing: Calculate the total cost of providing your service, including parts and labor, and add a markup percentage to ensure a profit.
• Market Rate Comparison: Research what competitors charge for similar services to ensure your prices are in line with the market.
• Value-Based Pricing: Price your services based on the perceived value to the customer, especially if you offer specialized expertise or benefits.
• Volume Discounts: Consider offering discounts to customers who purchase services in bulk or sign long-term contracts, to encourage larger sales.
• Dynamic Pricing: Be open to adjusting your prices based on demand, seasonal trends, or the introduction of new technologies and services.
• Transparent Pricing: Make sure your pricing structure is clear and understandable to avoid confusion and build trust with customers.

What does it cost to start a hardware business?

Initiating a hardware business can involve substantial financial commitment, the scale of which is significantly influenced by factors such as geographical location, market dynamics, and operational expenses, among others. Nonetheless, our extensive research and hands-on experience have revealed an estimated starting cost of approximately $200000 for launching such an business. Please note, not all of these costs may be necessary to start up your hardware business.

Starting a hardware business requires careful consideration when it comes to acquiring equipment and supplies. It's essential to procure high-quality items that meet your customers' needs while also ensuring cost-effectiveness. Below are key points to guide you through this crucial step:

• Research your market to understand the demand for specific hardware products and identify the most sought-after items.
• Choose reliable suppliers with good track records for quality, delivery, and service. Consider establishing partnerships or accounts with wholesalers for better pricing.
• Consider the balance between cost and quality when purchasing inventory. Higher-quality items may offer better long-term value to your customers.
• Invest in a robust inventory management system to track your stock levels, sales patterns, and reorder times.
• Ensure that your storage facilities are adequate to preserve the quality and integrity of your hardware supplies.
• Include essential tools and machinery for demonstrations, repairs, or value-added services you plan to offer.
• Don't forget about office and operational supplies, such as computers, point-of-sale systems, and office furniture.
• Plan for safety equipment to protect your employees and comply with local regulations.

List of software, tools and supplies needed to start a hardware business:

• Hardware equipment (starting from $500 - $10,000 depending on the size of the business and the type of hardware)
• Toolboxes and hand tools (between $50 -$500)
• Workbenches, tables and chairs (around $200-$1000)
• Software for hardware inventory, sales & ordering ($30-$200/month depending on features)
• Computer hardware (between $500 to $3000)
• Software for client management (around $12-$50/month)
• Wireless internet connection ($25-$150/month depending on provider and speed
• POS system with receipt printer, scanner & credit card reader (around $170 - $1000)
• Office supplies & stationery ($50 -$200 depending on quantity)
• Storage solutions (shelves and filing cabinets) ($50 to $500 depending on size and features)

Securing the right business insurance is a crucial step in protecting your hardware business against unforeseen events. It is essential to understand the different types of insurance available and determine which ones are necessary for your specific business needs. Consider the following points when obtaining business insurance:

• Evaluate the risks associated with your hardware business to identify the types of insurance that are most applicable, such as property insurance, liability insurance, or product liability insurance.
• Consult with a licensed insurance agent who specializes in commercial policies to get professional advice tailored to your industry.
• Compare quotes from multiple insurance providers to find the best coverage options at a competitive price.
• Ensure that your policy covers all essential aspects of your business, including inventory, equipment, and potential business interruptions.
• Review and understand the terms and coverage limits of your policy to make sure you are adequately protected against claims or damages.
• Consider additional coverage options such as cyber liability insurance if your business operations involve online transactions or data storage.
• Keep your insurance policies up to date and review them annually or whenever there are significant changes to your business operations.

Now that your hardware services are ready to be offered to the public, it's crucial to get the word out to your target market. Marketing your services effectively will help you build brand awareness, attract customers, and differentiate your offerings from competitors. Here are some strategies to kickstart your marketing efforts:

• Develop a strong online presence by creating a professional website and engaging on social media platforms where your potential customers are active.
• Offer promotions and discounts to first-time customers to encourage them to try your services.
• Network with local businesses and attend industry events to build relationships and gain referrals.
• Invest in search engine optimization (SEO) to improve your visibility on search engines and attract organic traffic.
• Use targeted advertising through Google Ads, social media ads, or local print media to reach potential customers effectively.
• Collect customer testimonials and reviews to build trust and credibility with potential clients.
• Partner with other businesses that offer complementary services to cross-promote each other and expand your customer base.

Expanding a hardware business is a critical step that requires strategic planning and execution. It's an opportunity to build on existing successes and capture new market segments. Here are some key points to consider as you plan to grow your hardware business:

• Assess Market Demand: Research to identify potential new markets and customer needs that your business can fulfill.
• Diversify Product Lines: Explore expanding your product offerings to include complementary goods or services that align with your brand.
• Invest in Technology: Utilize modern inventory management systems and e-commerce platforms to streamline operations and extend your reach.
• Strengthen Supply Chains: Forge strong relationships with suppliers to ensure reliable delivery and competitive pricing.
• Enhance Marketing Efforts: Increase your marketing budget to raise brand awareness and reach a wider audience. Consider online and offline strategies.
• Expand Sales Channels: Look into opening more physical locations or expanding online sales channels to access new customer bases.
• Optimize Operational Efficiency: Review and improve internal processes to reduce costs and improve customer service.

How to Start a Hardware Store

Starting a hardware store can be very profitable. With proper planning, execution and hard work, you can enjoy great success. Below you will learn the keys to launching a successful hardware store.

Importantly, a critical step in starting a hardware store is to complete your business plan. To help you out, you should download Growthink’s Ultimate Business Plan Template here .

Download our Ultimate Business Plan Template here

14 Steps To Start a Hardware Store :

• Choose the Name for Your Hardware Store
• Develop Your Hardware Store Business Plan
• Choose the Legal Structure for Your Hardware Store
• Secure Startup Funding for Your Hardware Store (If Needed)
• Secure a Location for Your Business
• Register Your Hardware Store with the IRS
• Open a Business Bank Account
• Get a Business Credit Card
• Get the Required Business Licenses and Permits
• Get Business Insurance for Your Hardware Store
• Buy or Lease the Right Hardware Store Equipment
• Develop Your Hardware Store Marketing Materials
• Purchase and Setup the Software Needed to Run Your Hardware Store
• Open for Business

1. Choose the Name for Your Hardware Store

The first step to starting a hardware store is to choose your business’ name.  

This is a very important choice since your company name is your brand and will last for the lifetime of your business. Ideally you choose a name that is meaningful and memorable. Here are some tips for choosing a name for your hardware store:

• Make sure the name is available . Check your desired name against trademark databases and your state’s list of registered business names to see if it’s available. Also check to see if a suitable domain name is available.
• Keep it simple . The best names are usually ones that are easy to remember, pronounce and spell.
• Think about marketing . Come up with a name that reflects the desired brand and/or focus of your hardware store.

2. Develop Your Hardware Store Business Plan

One of the most important steps in starting a hardware store is to develop your business plan . The process of creating your plan ensures that you fully understand your market and your business strategy. The plan also provides you with a roadmap to follow and if needed, to present to funding sources to raise capital for your business.

Your business plan should include the following sections:

• Executive Summary – this section should summarize your entire business plan so readers can quickly understand the key details of your hardware store.
• Company Overview – this section tells the reader about the history of your hardware store and what type of hardware store you operate. For example, are you a home improvement store, a specialty hardware store, or a big-box store?
• Industry Analysis – here you will document key information about the hardware industry. Conduct market research and document how big the industry is and what trends are affecting it.
• Customer Analysis – in this section, you will document who your ideal or target market are and their demographics. For example, how old are they? Where do they live? What do they find important when purchasing products like the ones you will offer?
• Competitive Analysis – here you will document the key direct and indirect competitors you will face and how you will build competitive advantage.
• Marketing Plan – your marketing plan should address the 4Ps: Product, Price, Promotions and Place.
• Product : Determine and document what products/services you will offer 
• Prices : Document the prices of your products/services
• Place : Where will your business be located and how will that location help you increase sales?
• Promotions : What promotional methods will you use to attract a loyal customer base to your hardware store? For example, you might decide to use pay-per-click advertising, public relations, search engine optimization and/or social media marketing.
• Operations Plan – here you will determine the key processes you will need to run your day-to-day operations. You will also determine your staffing needs. Finally, in this section of your plan, you will create a projected growth timeline showing the milestones you hope to achieve in the coming years.
• Management Team – this section details the background of your company’s management team.
• Financial Plan – finally, the financial plan answers questions including the following:
• What startup costs will you incur?
• How will your hardware store make money?
• What are your projected sales and expenses for the next five years?
• Do you need to raise funding to launch your business?

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3. choose the legal structure for your hardware store.

Next you need to choose a legal structure for your hardware store and register it and your business name with the Secretary of State in each state where you operate your business.

Below are the five most common legal structures:

1) Sole proprietorship

A sole proprietorship is a business entity in which the hardware store owner and the business are the same legal person. The owner of a sole proprietorship is responsible for all debts and obligations of the business. There are no formalities required to establish a sole proprietorship, and it is easy to set up and operate. The main advantage of a sole proprietorship is that it is simple and inexpensive to establish. The main disadvantage is that the owner is liable for all debts and obligations of the business.

2) Partnerships

A partnership is a legal structure that is popular among small business owners. It is an agreement between two or more people who want to open a hardware store together. The partners share in the profits and losses of the business. 

The advantages of a partnership are that it is easy to set up, and the partners share in the profits and losses of the business. The disadvantages of a partnership are that the partners are jointly liable for the debts of the business, and disagreements between partners can be difficult to resolve.

3) Limited Liability Company (LLC)

A limited liability company, or LLC, is a type of business entity that provides limited liability to its owners. This means that the owners of an LLC are not personally responsible for the debts and liabilities of the business. The advantages of an LLC for a hardware store include flexibility in management, pass-through taxation (avoids double taxation as explained below), and limited personal liability. The disadvantages of an LLC include lack of availability in some states and self-employment taxes.

4) C Corporation

A C Corporation is a business entity that is separate from its owners. It has its own tax ID and can have shareholders. The main advantage of a C Corporation for a hardware store is that it offers limited liability to its owners. This means that the owners are not personally responsible for the debts and liabilities of the business. The disadvantage is that C Corporations are subject to double taxation. This means that the corporation pays taxes on its profits, and the shareholders also pay taxes on their dividends.

5) S Corporation

An S Corporation is a type of corporation that provides its owners with limited liability protection and allows them to pass their business income through to their personal income tax returns, thus avoiding double taxation. There are several limitations on S Corporations including the number of shareholders they can have among others.

Once you register your hardware store, your state will send you your official “Articles of Incorporation.” You will need this among other documentation when establishing your banking account (see below). We recommend that you consult an attorney in determining which legal structure is best suited for your company.

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4. Secure Startup Funding for Your Hardware Store (If Needed)

In developing your hardware store business plan, you might have determined that you need to raise funding to launch your business. 

If so, the main sources of funding for a hardware store to consider are personal savings, family and friends, credit card financing, bank loans, crowdfunding and angel investors. Angel investors are individuals who provide capital to early-stage businesses. Angel investors typically will invest in a hardware store that they believe has high potential for growth.

5. Secure a Location for Your Business

There are a few things to consider when looking for a location for your hardware store. 

First, you’ll want to think about the population of the area. You’ll want to be sure there are enough people in the area who will be potential hardware shoppers. 

Additionally, you’ll want to think about the competition. If there are already several independent hardware stores in the area, you’ll need to find a location that offers something different or better than what is already available. 

You’ll also need to find a space that is big enough to fit all of your inventory. Finally, you’ll want to think about your budget and find a location that is affordable.

6. Register Your Hardware Store with the IRS

Next, you need to register your business with the Internal Revenue Service (IRS) which will result in the IRS issuing you an Employer Identification Number (EIN).

Most banks will require you to have an EIN in order to open up an account. In addition, in order to hire store personnel, you will need an EIN since that is how the IRS tracks your payroll tax payments.

Note that if you are a sole proprietor without employees, you generally do not need to get an EIN. Rather, you would use your social security number (instead of your EIN) as your taxpayer identification number.

7. Open a Business Bank Account

It is important to establish a bank account in your hardware store’ name. This process is fairly simple and involves the following steps:

• Identify and contact the bank you want to use
• Gather and present the required documents (generally include your company’s Articles of Incorporation, driver’s license or passport, and proof of address)
• Complete the bank’s application form and provide all relevant information
• Meet with a banker to discuss your business needs and establish a relationship with them

8. Get a Business Credit Card

You should get a business credit card for your hardware store to help you separate personal and business expenses.

You can either apply for a business credit card through your bank or apply for one through a credit card company.

When you’re applying for a business credit card, you’ll need to provide some information about your business. This includes the name of your business, the address of your business, and the type of business you’re running. You’ll also need to provide some information about yourself, including your name, Social Security number, and date of birth.

Once you’ve been approved for a business credit card, you’ll be able to use it to make purchases for your business. You can also use it to build your credit history which could be very important in securing a small business loan and getting credit lines for your business in the future.

9. Get the Required Business Licenses and Permits

To launch a hardware store, you will need a business license and a tax ID number. You will also need to contact your local zoning commission to find out what restrictions are placed on hardware stores in your area. Depending on the size of your store and how it will be laid out, you may need a building permit.

10. Get Business Insurance for Your Hardware Store

The insurance you need to operate a hardware store may vary depending on your state’s laws and regulations. 

Some common business insurance policies you should consider for your own shop include:

• General liability insurance : This covers accidents and injuries that occur on your property. It also covers damages caused by your employees or products.
• Auto insurance : If a vehicle is used in your business, this type of insurance will cover if a vehicle is damaged or stolen.
• Workers’ compensation insurance : If you have employees, this type of policy works with your general liability policy to protect against workplace injuries and accidents. It also covers medical expenses and lost wages.
• Commercial property insurance : This covers damage to your property caused by fire, theft, or vandalism.
• Business interruption insurance : This covers lost income and expenses if your business is forced to close due to a covered event.
• Professional liability insurance : This protects your business against claims of professional negligence.

Find an insurance agent, tell them about your business and its needs, and they will recommend policies that fit those needs.

11. Buy or Lease the Right Hardware Store Equipment

To run a hardware store, you will need the following equipment: cash register, computer, phone, security cameras, and shelves.

12. Develop Your Hardware Store Marketing Materials

Marketing materials will be required to attract and retain customers to your hardware store.

The key marketing materials you will need are as follows:

• Logo : Spend some time developing a good logo for your hardware store. Your logo will be printed on company stationery, business cards, marketing materials and so forth. The right logo can increase customer trust and awareness of your brand.
• Website : Likewise, a professional hardware store website provides potential customers with information about the products you offer, your company’s history, and contact information. Importantly, remember that the look and feel of your website will affect how customers perceive you.
• Social Media Accounts : establish social media accounts in your company’s name. Accounts on Facebook, Twitter, LinkedIn and/or other social media networks will help customers and others find and interact with your hardware store.

13. Purchase and Setup the Software Needed to Run Your Hardware Store

To run a hardware store, you will need accounting software and customer relationship management (CRM) software. You will also need software that will help you manage your inventory, track your sales, and create purchase orders. Additionally, you will need a point of sale (POS) system to handle purchases made by customers.

14. Open for Business

You are now ready to open your hardware store. If you followed the steps above, you should be in a great position to build a successful business. Below are answers to frequently asked questions that might further help you.

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How to Start a Hardware Store FAQs

Is it hard to start a hardware store.

No, it is fairly easy to launch a hardware store. All you need is an idea of the type of product you want to sell and where you want to sell it. You should also define your business model and plan how you're going to market, promote, maintain, and manage it.

How can I start a hardware store with no experience?

There are a few ways to go about starting a hardware store with no retail and hardware experience. One way would be to research the industry and learn as much as possible about the business. Another option would be to team up with someone who has experience in the industry. Finally, you could take on a consultant to help you get started. Whichever path you choose, make sure you have a clear plan and are prepared to put in the hard work necessary to make your own hardware store a success.

What type of hardware store is most profitable?

Generally speaking, stores that sell higher-priced items such as appliances or tools tend to be more profitable than stores that sell lower-priced items such as plumbing supplies or light bulbs. Additionally, stores that are located in high-traffic areas tend to be more profitable than stores that are located in low-traffic areas.

How much does it cost to start a hardware store?

It can cost a lot of money to open a hardware store. You'll need to invest in inventory, and you'll also need to pay for rent, utilities, and employee salaries.

Some startup costs involved in starting a hardware store include:

• Security system 
• Computer system 
• Purchasing inventory
• Credit card machines
• Building a retail space
• Fixtures and display cases
• Licenses and permits

What are the ongoing expenses for a hardware store?

Ongoing expenses for a hardware store generally include utilities, rent, and inventory. Additional expenses to keep in mind include insurance and wages.

How does a hardware store make money?

Hardware store owner s make money by selling products to repair or improve a home. These products can include tools, building supplies, appliances, and more. The store makes money by selling products and by charging customers for the labor to install hardware or appliances.

Is owning a hardware store profitable?

Owning a hardware store can be a profitable business venture. This is because hardware shops typically have high margins. This means that the store can sell products at a higher price than it paid for them, and thus make a profit. 

Why do hardware stores fail?

Most hardware stores lose a large portion of their clientele due to the internet and the fast-paced shopping experience that comes with it. A lot of people now choose to order online because they can do so from the convenience of their own homes with the click of a mouse. Most often these transactions will be cheaper as well.

Another common reason hardware stores fail is from being in business for too long without changing their offerings with evolving customer preferences. Sometimes they fail because consumers simply need different goods than what the old-fashioned store offers. For instance, key cutting, lawn care booklets, or landscaping materials may not be as in demand as they once were.

Finally, some chain retail hardware stores fail because they are in the wrong location. If the store is in a location that is not easily accessible or visible to passersby, it may not get enough customers to sustain its operations.

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Hardware Store

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How to Start a Hardware Store

Written by: Carolyn Young

Carolyn Young is a business writer who focuses on entrepreneurial concepts and the business formation. She has over 25 years of experience in business roles, and has authored several entrepreneurship textbooks.

Edited by: David Lepeska

David has been writing and learning about business, finance and globalization for a quarter-century, starting with a small New York consulting firm in the 1990s.

Published on May 24, 2022 Updated on March 13, 2024

Investment range

$83,550 - $119,100

Revenue potential

$547,000 - $1.37 million p.a.

Time to build

1 – 3 months

Profit potential

$55,000 - $137,000 p.a.

Industry trend

With the growing interest in DIY projects, particularly among millennials, hardware stores have been thriving, expanding nearly 46% in the last decade. If you have a passion for tools, you could start your own hardware store, provide an invaluable local service and eventually grow into the next Ace Hardware or Home Depot. 

But first you’ll need to know the nuts and bolts of starting a business and being an entrepreneur. Luckily, that information is all packed into this handy step-by-step guide, which will prepare you to launch and operate a successful hardware store. 

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Step 1: Decide if the Business Is Right for You

Pros and cons.

Starting a hardware store has pros and cons to consider before deciding if it’s right for you.

• Resilient Market – Hardware stores even fared well during the pandemic
• Provide Value – Tools are required for many necessary tasks
• Good Money – Most tools are relatively expensive
• Investment Required – Building inventory requires upfront money
• Crowded Market – Compete with brands like True Value and Ace Hardware

Hardware store industry trends

Industry size and growth.

• Industry size and past growth – The US hardware stores industry is worth $35.1 billion in 2022 after expanding 4.8% annually for the last five years.(( https://www.ibisworld.com/industry-statistics/market-size/hardware-stores-united-states/ )) 
• Growth forecast – The US hardware store industry is projected to experience a very slight decline in 2022. 
• Number of businesses – In 2022, 14,918 hardware store businesses are operating in the US.(( https://www.ibisworld.com/industry-statistics/number-of-businesses/hardware-stores-united-states/ )) 
• Number of people employed – In 2022, the US hardware stores industry employs 169,387 people.(( https://www.ibisworld.com/industry-statistics/employment/hardware-stores-united-states/ )) 

Trends and challenges

Trends in the hardware store industry include:

• The DIY home improvement market is growing, led by millennials, with many hardware stores branding themselves as DIY stores and offering classes. 
• Hardware delivery is on the rise, presenting an additional revenue opportunity for hardware stores.

Challenges in the hardware store industry include:

• The proliferation of online hardware stores is creating new competition for traditional hardware stores.
• The rise of stores like Home Depot and Lowe’s has driven many small hardware stores out of business. 

How much does it cost to start a hardware store business?

Startup costs for a hardware store range from $85,000 to $120,000. The largest cost by far is the inventory. Other costs include the space rental and preparation. 

Alternatively, you could sharply reduce the initial costs by starting out with an online hardware store before opening a physical location. 

How much can you earn from a hardware store business?

Prices for items sold will obviously vary. These calculations will assume that your average customer will spend $50 Your profit margin after cost of goods sold, rent, labor, and overhead, should be about 10%.

In your first year or two, you might have 30 customers a day, bringing in $547,000 in annual revenue. This would mean $55,000 in profit, assuming that 10% margin. As your brand gains recognition and your store becomes more well known, you might get 75 customers a day. With annual revenue of $1,370,000, you’d make an outstanding profit of $137,000.

What barriers to entry are there?

There are a few barriers to entry for a hardware store. Your biggest challenges will be:

• The high startup costs of inventory
• Facing a large number of competitors

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Step 2: hone your idea.

Now that you know what’s involved in starting a hardware store, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Market research will give you the upper hand, even if you’re already positive that you have a perfect product or service. Conducting market research is important, because it can help you understand your customers better, who your competitors are, and your business landscape.

Why? Identify an opportunity

Research hardware stores in your area to examine their products, price points, and customer reviews. You’re looking for a market gap to fill. For instance, maybe the local market is missing a small hardware store that offers DIY classes, or a hardware store that offers same-day delivery.

You might consider targeting a niche market by specializing in a certain aspect of your industry, such as plumbing supplies or power tools.

This could jumpstart your word-of-mouth marketing and attract clients right away. 

What? Determine your products or services

Your products will be any number of hardware items, from nails to power tools. You can earn additional revenue by offering deliveries or holding DIY classes.

How much should you charge for hardware?

Prices will vary by hardware item. Typically, you should mark up your prices from wholesale prices to have a gross profit margin of 40%. After the costs of rent, labor, and overhead, your net profit should be about 10%. 

Once you know your costs, you can use this Step By Step profit margin calculator to determine your mark-up and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify your target market

Your target market will be mainly homeowners and contractors. You should spread out your social media marketing to include TikTok, Instagram, Facebook, and LinkedIn.

Where? Choose a hardware store location

To choose the ideal hardware store location, start by researching the local market to pinpoint areas with strong demand for your products.

Opt for a location with good visibility, easy access by car and public transportation, and ample parking.

Ensure the chosen site has sufficient space for product display, storage, and customer flow.

Lastly, consider the competition, safety, and neighborhood quality, as these factors contribute to attracting and retaining customers.

You’ll most likely need to rent out a storefront. You can find commercial space to rent in your area on sites such as Craigslist , Crexi , and Instant Offices .

Step 3: Brainstorm a Hardware Store Name

Your business name is your business identity, so choose one that encapsulates your objectives, services, and mission in just a few words. You probably want a name that’s short and easy to remember, since much of your business, and your initial business in particular, will come from word-of-mouth referrals.

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “hardware” or “hardware store”, boosts SEO
• Name should allow for expansion, for ex: “Ace Hardware Co.” over “Plumbing Parts Palace”
• Avoid location-based names that might hinder future expansion
• Use online tools like the Step by Step Business Name Generator . Just type in a few keywords and hit “generate” and you’ll have dozens of suggestions at your fingertips.

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Find a Domain

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Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that sets your business apart. Once you pick your company name, and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create a Hardware Store Business Plan

Every business needs a plan. This will function as a guidebook to take your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision:

• Executive Summary: A brief summary outlining the core elements of the hardware store business plan, including its mission, goals, and key financial projections.
• Business Overview: An overview of the hardware store business, including its mission statement, location, legal structure, and a brief history or background.
• Product and Services: A detailed description of the hardware products and services the store will offer, emphasizing the unique selling points and value proposition.
• Market Analysis: An examination of the target market for the hardware store, including demographics, market size, trends, and potential opportunities and challenges.
• Competitive Analysis: An assessment of the hardware store’s competitors, identifying strengths, weaknesses, opportunities, and threats in the market.
• Sales and Marketing: A plan outlining how the hardware store will attract and retain customers, including marketing strategies, sales tactics, and promotional activities.
• Management Team: Profiles of key individuals responsible for managing and operating the hardware store, highlighting their qualifications and roles.
• Operations Plan: Details on how the hardware store will operate on a day-to-day basis, covering inventory management, suppliers, facilities, and other operational aspects.
• Financial Plan: A comprehensive financial projection for the hardware store, including startup costs, revenue forecasts, profit and loss statements, and cash flow projections.
• Appendix: Supplementary materials that provide additional information, such as resumes of key team members, detailed market research data, and any other supporting documents.

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.

Step 5: Register Your Business

Registering your business is an absolutely crucial step — it’s the prerequisite to paying taxes, raising capital, opening a bank account, and other guideposts on the road to getting a business up and running.

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you’re planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to hardware stores. 

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state. 

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your hardware store will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

• Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
• General Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
• Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
• C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
• S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC , which just need to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization , and answer any questions you might have.

Form Your LLC

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Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number , or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

The IRS website also offers a tax-payers checklist , and taxes can be filed online.

It is important to consult an accountant or other professional to help you with your taxes to ensure you’re completing them correctly.

Step 7: Fund your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loans: This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
• SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan .
• Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
• Friends and Family: Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
• Personal: Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best option, other than friends and family, for funding a hardware store business. 

Step 8: Apply for Hardware Store Business Licenses and Permits

Starting a hardware store business requires obtaining a number of licenses and permits from local, state, and federal governments.

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration ( OSHA ), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package . They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

This is not a step to be taken lightly, as failing to comply with legal requirements can result in hefty penalties.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account .

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your hardware store business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business Property: Provides coverage for your equipment and supplies.
• Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation: Provides compensation to employees injured on the job.
• Property: Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto: Protection for your company-owned vehicle.
• Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks. 

You may want to use industry-specific software, such as  LS Retail ,  Vend , or  Retail Pro , to manage purchasing, inventory, and invoicing.

• Popular web-based accounting programs for smaller businesses include Quickbooks , Freshbooks , and Xero . 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial.

Develop your website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism.

You can create your own website using website builders . This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

They are unlikely to find your website, however, unless you follow Search Engine Optimization ( SEO ) practices. These are steps that help pages rank higher in the results of top search engines like Google. 

For your hardware store, the marketing strategy should focus on showcasing the variety and quality of your products, your expertise in home improvement and DIY projects, and your commitment to customer service. Emphasize any unique offerings like specialized tools, local products, or services such as tool rental or repair. Here are some powerful marketing strategies for your future business:

Kickstart Marketing

• Professional Branding : Your branding should convey reliability, quality, and expertise. This includes your store’s signage, logo, staff uniforms, and overall store layout and design.
• Direct Outreach : Network with local contractors, tradespeople, and DIY enthusiasts. Offer workshops or training sessions at your store to draw in these customers.

Digital Presence and Online Marketing

• Professional Website and SEO : Develop a website that lists your products, services, and store information. Use SEO best practices to rank for local searches related to hardware stores, home improvement, and DIY projects.
• Social Media Engagement : Utilize platforms like Facebook, Instagram, and YouTube to showcase your products, share DIY tips, and highlight customer projects.

Content Marketing and Engagement

• DIY Blog or Video Series : Share informative content about home improvement projects, tool usage tips, and DIY ideas. Video content can be particularly engaging and useful for demonstrating how to use certain tools or complete specific projects.
• Email Newsletters : Regular newsletters can inform your customers about new products, upcoming workshops, and special promotions.
• Expert Advice and FAQs : Offer expert advice sections or FAQs on your website to help customers with their DIY queries and position your store as a knowledgeable resource.

Experiential and In-Person Engagements

• In-Store Workshops and Demonstrations : Host regular workshops or live demonstrations on various home improvement topics to attract customers to your store and engage with them directly.
• Community Events : Participate in or sponsor local community events to increase brand visibility and connect with potential customers.

Collaborations and Community

• Partnerships with Local Businesses : Collaborate with local contractors and home service businesses for mutual referrals. Partnering with local craftspeople or manufacturers can also diversify your product offerings.
• Local School and Community Projects : Engage in local school projects or community building projects, providing materials or expertise.

Customer Relationship and Loyalty Programs

• Loyalty Rewards Program : Implement a program offering discounts, points, or special perks to regular customers.
• Contractor and Tradesperson Discounts : Offer special discounts or accounts for professional contractors and tradespeople to encourage repeat business.

Promotions and Advertising

• Targeted Local Advertising : Use local newspapers, radio, community boards, and online platforms to advertise your store and any special promotions or events.
• Seasonal Promotions and Sales : Take advantage of seasonal cycles in home improvement and gardening to offer relevant promotions and sales.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your hardware store meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your hardware store business could be: 

• Your hometown hardware store has you covered! 
• All the hand and power tools at great prices
• Your #1 resource for DIY projects 

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a hardware store, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in hardware stores for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in hardware. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

If you’re starting out small from a home office, you may not need any employees. But as your business grows, you will likely need workers to fill various roles. Potential positions for a hardware store business include:

• Store Clerks – make sales, customer service
• General Manager – scheduling, ordering, inventory management, accounting
• Marketing Lead – SEO strategies, social media

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed , Glassdoor , or ZipRecruiter . Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Run a Hardware Store – Start Making Money!

Good old-fashioned hardware stores are an important part of any community. Many people prefer the small local shop, rather than going into a store that looks like a giant warehouse and getting lost. If you have a passion for tools and DIY, you could create a community hardware store, provide value to customers, and start building your hardware empire! 

You’ve got business knowledge in your toolbelt now, so it’s time to hit the ground running and start your successful hardware store. 

• Hardware Store Business FAQs

Yes, hardware stores can be very profitable. The key is to offer a variety of hardware items and provide great customer service that will keep people coming back.

The biggest hardware store company is The Home Depot, followed by Lowe’s and Menards.

A successful hardware store typically offers a wide range of products, excellent customer service, knowledgeable staff, fair pricing, and a convenient location. Additionally, successful hardware stores may provide additional services such as equipment rental, repair or installation services, or educational workshops and events.

To differentiate your hardware store from competitors, you could focus on providing a personalized and consultative approach to customer service, offering unique or specialized products, using eco-friendly and sustainable practices, or providing additional services such as delivery or installation. You could also consider partnering with local businesses or community organizations, hosting events or workshops, or using targeted advertising to attract new customers and encourage loyalty.

Effective marketing and advertising strategies for promoting your hardware store could include creating a strong online presence through social media and a user-friendly website, offering promotions or discounts to attract new customers and encourage loyalty, hosting events such as DIY workshops or tool demonstrations, using visual merchandising and signage to create an inviting and attractive shopping environment, and offering exceptional customer service to encourage positive word-of-mouth referrals. 

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• Decide if the Business Is Right for You
• Hone Your Idea
• Brainstorm a Hardware Store Name
• Create a Hardware Store Business Plan
• Register Your Business
• Register for Taxes
• Fund your Business
• Apply for Hardware Store Business Licenses and Permits
• Open a Business Bank Account
• Get Business Insurance
• Prepare to Launch
• Build Your Team
• Run a Hardware Store - Start Making Money!

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Sample Hardware Store Business Plan

Do you wish to develop a hardware store business plan?

The success of such a great business idea largely rests on a strategy or plan .

The absence of such a plan is bound to affect the business development. As a crucial tool to business success, we’ve provided a template to follow in writing your hardware store business plan.

HARDWARE STORE BUSINESS PLAN SAMPLE

By following the key sections included you’re able to put in place a streamlined plan of action. Of course, your hardware store business plan needs to be implemented in the letter.

Here, we’ll be discussing all of that and more. We welcome you to read on to find such details.

A Good Hardware Store Business Plan Must have these Sections

Before we go any further, it’s pertinent to provide a framework around which the plan will be written. Here, we’re talking about must-have sections that are key to a good plan.

These include the executive summary, company description, and the products & services sections.

Others are the market analysis, strategy & implementation, organization & management team as well as the financial plan & projection sections.

i. Executive Summary

As a brief introduction and summary of your hardware store business plan, this section should be concise enough to grab the attention of your reader.

Here, you want to give them a reason why they should read through your entire plan.

The executive summary clearly defines whether the business idea is viable or not.

More importantly, it provides an implementable plan of action that is systematically followed. To make it quick and easy to read, your executive summary should have an average of one to four pages.

You want your executive summary to make up about 10% of your entire business plan. Within this section are key subsections such as the business name & location as well as the products & services sections.

Others include the mission & vision statements, and the purpose of the plan.

Business Name & Location

What’s the identity of your hardware store business? Of key importance is the name it will go by. Another detail that needs to be included in its location.

With this information, the reader understands your business from very scratch.

Products & Services

Although there’s a product and services section in the wider plan, this must also be included in your executive summary. Now, only the basics need to be captured here.

For a fuller detail of all products and services offered by your hardware store, the reader will need to read the plan.

You’re expected to have worked out all your hardware store products and/or related services well in advance. This may require research on your part. Ensure the basics are captured under this section.

Mission & Vision

This section explains crucial areas of your plan. The mission and vision statements set the performance standards for your hardware store business plan. What more?

They help provide employees with set goals to attain, thus promoting efficiency.

Your mission statement should be action-oriented in nature.

Here, an explanation of your business’s purpose and what benefits it has for clients is provided. It should also include your business’s goals and its core functions.

Your vision statement should give a vivid mental image of your hardware store business. Here, the image of what you intend to be at some point in the future is provided. This is largely based on your goals and aspirations.

Purpose of the Plan

What’s the purpose of your plan? Every business plan has a purpose and yours shouldn’t be any different.

Whatever it is, it must include set strategies and attract investors.

ii. Company Description

The company description section of your hardware store business plan focuses on key areas such as the legal structure, the business’ history, as well as the needs you intend to meet. What more?

Consider including an overview of products and services and also a company growth summary.

Another detail that must be added is your short and long-term business goals. More importantly, you’ll need to show investors your plans for making a profit.

iii. Products & Services

This was earlier discussed as a subsection under the executive summary.

Here, you’ll need to add all the important details like the description of such services and products. Information on the market role of your products as well as its advantages must be stated.

What’s the life cycle of your hardware products? All relevant information on patents, copyright, or trade secrets should be added. Are new products in the works?

Include information on any or other ongoing developmental activities.

iv. Market Analysis

In this section of your plan, you’ll need to show significant industry knowledge.

This level of understanding largely depends on thorough market research. Here, you’ll be providing a representation or sketch of targeted market segments.

A description of the hardware store industry will also be in order. Its outlook, as well as supporting statistics, are also necessary to gain a fuller and more robust understanding of what your business is about.

Also include information on historical, current, and projected marketing data for services and products.

An assessment of your competitors is also in order. Here, you’re looking at their strengths as well as weaknesses.

v. Strategy & Implementation

With the help of an operating plan, you’re able to implement your sales and marketing strategy.

Under this section, you’re looking at costing details, pricing, promotion as well as distribution or logistics. Your strategy and implementation section must also provide promotion details and how your products will enter the market.

How will your hardware store business function? Include details on labor sources as well as the number of employees.

vi. Organization & Management Team

This is the bedrock upon which every business is structured.

Your hardware store business will need an efficient management team in place. Provide details on this by including an organizational chart with key employees highlighted.

There should be additional information on owners, their names, percentage ownership, as well the extent of their involvement. Include a profile of your management team with names, positions, responsibilities, and experience provided.

vii. Financial Plan & Projections

The financial plan and projections section is a crucial component of your hardware store business plan. Here, the help of a financial expert such as a professional accountant is needed.

Details to include are the historical financial data with balance sheets, income statements, and cash flow statements spanning the past three to five years.

There should be realistic prospective financial data. This includes balance sheets, forecasted income statements, cash flow statements, and capital expenditure.

With all of these key sections and details included in your hardware store business plan, your chances for success are greatly improved.

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How to write a business plan for a diy and hardware store?

Writing a business plan for a diy and hardware store can be an intimidating task, especially for those just starting.

This in-depth guide is designed to help entrepreneurs like you understand how to create a comprehensive business plan so that you can approach the exercise with method and confidence.

We'll cover: why writing a diy and hardware store business plan is so important - both when starting up, and when running and growing the business - what information you need to include in your plan, how it should be structured, and what tools you can use to get the job done efficiently.

Let's get started!

In this guide:

Why write a business plan for a diy and hardware store?

• What information is needed to create a business plan for a diy and hardware store?
• What goes in the financial forecast for a diy and hardware store?
• What goes in the written part of a diy and hardware store business plan?
• What tool can I use to write my diy and hardware store business plan?

Having a clear understanding of why you want to write a business plan for your diy and hardware store will make it simpler for you to grasp the rationale behind its structure and content. So before delving into the plan's actual details, let's take a moment to remind ourselves of the primary reasons why you'd want to create a diy and hardware store business plan.

To have a clear roadmap to grow the business

Small businesses rarely experience a constant and predictable environment. Economic cycles go up and down, while the business landscape is mutating constantly with new regulations, technologies, competitors, and consumer behaviours emerging when we least expect it.

In this dynamic context, it's essential to have a clear roadmap for your diy and hardware store. Otherwise, you are navigating in the dark which is dangerous given that - as a business owner - your capital is at risk.

That's why crafting a well-thought-out business plan is crucial to ensure the long-term success and sustainability of your venture.

To create an effective business plan, you'll need to take a step-by-step approach. First, you'll have to assess your current position (if you're already in business), and then identify where you'd like your diy and hardware store to be in the next three to five years.

Once you have a clear destination for your diy and hardware store, you'll focus on three key areas:

• Resources: you'll determine the human, equipment, and capital resources needed to reach your goals successfully.
• Speed: you'll establish the optimal pace at which your business needs to grow if it is to meet its objectives within the desired timeframe.
• Risks: you'll identify and address potential risks you might encounter along the way.

By going through this process regularly, you'll be able to make informed decisions about resource allocation, paving the way for the long-term success of your business.

To maintain visibility on future cash flows

Businesses can go for years without making a profit, but they go bust as soon as they run out of cash. That's why "cash is king", and maintaining visibility on your diy and hardware store's future cash flows is critical.

How do I do that? That's simple: you need an up-to-date financial forecast.

The good news is that your diy and hardware store business plan already contains a financial forecast (more on that later in this guide), so all you have to do is to keep it up-to-date.

To do this, you need to regularly compare the actual financial performance of your business to what was planned in your financial forecast, and adjust the forecast based on the current trajectory of your business.

Monitoring your diy and hardware store's financial health will enable you to identify potential financial problems (such as an unexpected cash shortfall) early and to put in place corrective measures. It will also allow you to detect and capitalize on potential growth opportunities (higher demand from a given segment of customers for example).

To secure financing

A detailed business plan becomes a crucial tool when seeking financing from banks or investors for your diy and hardware store.

Investing and lending to small businesses are very risky activities given how fragile they are. Therefore, financiers have to take extra precautions before putting their capital at risk.

At a minimum, financiers will want to ensure that you have a clear roadmap and a solid understanding of your future cash flows (like we just explained above). But they will also want to ensure that your business plan fits the risk/reward profile they seek.

This will off-course vary from bank to bank and investor to investor, but as a rule of thumb. Banks will want to see a conservative financial management style (low risk), and they will use the information in your business plan to assess your borrowing capacity — the level of debt they think your business can comfortably handle — and your ability to repay the loan. This evaluation will determine whether they'll provide credit to your diy and hardware store and the terms of the agreement.

Whereas investors will carefully analyze your business plan to gauge the potential return on their investment. Their focus lies on evidence indicating your diy and hardware store's potential for high growth, profitability, and consistent cash flow generation over time.

Now that you recognize the importance of creating a business plan for your diy and hardware store, let's explore what information is required to create a compelling plan.

Information needed to create a business plan for a diy and hardware store

You need the right data in order to project sales, investments and costs accurately in the financial forecast of your diy and hardware store business plan.

Below, we'll cover three key pieces of information you should gather before drafting your business plan.

Carrying out market research for a diy and hardware store

As you consider writing your business plan for a diy and hardware store, conducting market research becomes a vital step to ensure accurate and realistic financial projections.

Market research provides valuable insights into your target customer base, competitors, pricing strategies, and other key factors that can significantly impact the commercial success of your business.

Through this research, you may uncover trends that could influence your diy and hardware store.

You might find that customers may be seeking out DIY and hardware products that are environmentally friendly. Additionally, customers might be looking for convenience when it comes to their DIY and hardware purchases, such as products that are easy to install or use.

Such market trends play a significant role in forecasting revenue, as they offer valuable data about potential customers' spending habits and preferences.

By incorporating these findings into your financial projections, you can present investors with more accurate information, helping them make informed decisions about investing in your diy and hardware store.

Developing the marketing plan for a diy and hardware store

Before delving into your diy and hardware store business plan, it's imperative to budget for sales and marketing expenses.

To achieve this, a comprehensive sales and marketing plan is essential. This plan should provide an accurate projection of the necessary actions to acquire and retain customers.

Additionally, it will outline the required workforce to carry out these initiatives and the corresponding budget for promotions, advertising, and other marketing endeavours.

By budgeting accordingly, you can ensure that the right resources are allocated to these vital activities, aligning them with the sales and growth objectives outlined in your business plan.

The staffing and equipment needs of a diy and hardware store

Whether you are at the beginning stages of your diy and hardware store or expanding its horizons, having a clear plan for recruitment and capital expenditures (investment in equipment and real estate) is vital to ensure your business's success.

To achieve this, both the recruitment and investment plans must align coherently with the projected timing and level of growth in your forecast. It is essential to secure appropriate funding for these plans.

A diy and hardware store might incur staffing costs such as salaries for employees, benefits, and payroll taxes. They may also need to purchase equipment such as point-of-sale systems, computers, and payment processing systems. Additionally, they may need to purchase inventory such as tools, hardware, and other supplies.

To create a financial forecast that accurately represents your business's outlook, remember to factor in other day-to-day operating expenses.

Now that you have all the necessary information, it's time to dive in and start creating your business plan and developing the financial forecast for your diy and hardware store.

What goes into your diy and hardware store's financial forecast?

The financial forecast of your diy and hardware store's business plan will enable you to assess the growth, profitability, funding requirements, and cash generation potential of your business in the coming years.

The four key outputs of a financial forecast for a diy and hardware store are:

• The profit and loss (P&L) statement ,
• The projected balance sheet ,
• The cash flow forecast ,
• And the sources and uses table .

Let's look at each of these in a bit more detail.

The projected P&L statement

The projected P&L statement for a diy and hardware store shows how much revenue and profit your business is expected to make in the future.

A healthy diy and hardware store's P&L statement should show:

• Sales growing at (minimum) or above (better) inflation
• Stable (minimum) or expanding (better) profit margins
• A healthy level of net profitability

This will of course depend on the stage of your business: numbers for a startup will look different than for an established diy and hardware store.

The projected balance sheet of your diy and hardware store

The balance sheet for a diy and hardware store is a financial document that provides a snapshot of your business’s financial health at a given point in time.

It shows three main components: assets, liabilities and equity:

• Assets: are resources owned by the business, such as cash, equipment, and accounts receivable (money owed by clients).
• Liabilities: are debts owed to creditors and other entities, such as accounts payable (money owed to suppliers) and loans.
• Equity: includes the sums invested by the shareholders or business owners and the cumulative profits and losses of the business to date (called retained earnings). It is a proxy for the value of the owner's stake in the business.

Examining the balance sheet is important for lenders, investors, or other stakeholders who are interested in assessing your diy and hardware store's liquidity and solvency:

• Liquidity: assesses whether or not your business has sufficient cash and short-term assets to honour its liabilities due over the next 12 months. It is a short-term focus.
• Solvency: assesses whether or not your business has the capacity to repay its debt over the medium-term.

Looking at the balance sheet can also provide insights into your diy and hardware store's investment and financing policies.

In particular, stakeholders can compare the value of equity to the value of the outstanding financial debt to assess how the business is funded and what level of financial risk has been taken by the owners (financial debt is riskier because it has to be repaid, while equity doesn't need to be repaid).

The projected cash flow statement

A cash flow forecast for a diy and hardware store shows how much cash the business is projected to generate or consume.

The cash flow statement is divided into 3 main areas:

• The operating cash flow shows how much cash is generated or consumed by the operations (running the business)
• The investing cash flow shows how much cash is being invested in capital expenditure (equipment, real estate, etc.)
• The financing cash flow shows how much cash is raised or distributed to investors and lenders

Looking at the cash flow forecast helps you to ensure that your business has enough cash to keep running, and can help you anticipate potential cash shortfalls.

It is also a best practice to include a monthly cash flow statement in the appendices of your diy and hardware store business plan so that the readers can view the impact of seasonality on your business cash position and generation.

The initial financing plan

The initial financing plan - also called a sources and uses table - is an important tool when starting a diy and hardware store.

It shows where the money needed to set up the business will come from (sources) and how it will be allocated (uses).

Having this table helps understand what costs are involved in setting up the diy and hardware store, how the risks are distributed between the shareholders and the lenders, and what will be the starting cash position (which needs to be sufficient to sustain operations until the business breaks even).

Now that the financial forecast of a diy and hardware store business plan is understood, let's focus on what goes into the written part of the plan.

The written part of a diy and hardware store business plan

The written part of a diy and hardware store business plan plays a key role: it lays out the plan of action you intend to execute to seize the commercial opportunity you've identified on the market and provides the context needed for the reader to decide if they believe your plan to be achievable and your financial forecast to be realistic.

The written part of a diy and hardware store business plan is composed of 7 main sections:

• The executive summary
• The presentation of the company
• The products and services
• The market analysis
• The strategy
• The operations
• The financial plan

Let's go through the content of each section in more detail!

1. The executive summary

In your diy and hardware store's business plan, the first section is the executive summary — a captivating overview of your plan that aims to pique the reader's interest and leave them eager to learn more about your business.

When crafting the executive summary, start with an introduction to your business, including its name, concept, location, how long it has been running, and what sets it apart. Briefly mention the products and services you plan to offer and your target customer profile.

Following that, provide an overview of the addressable market for your diy and hardware store, current trends, and potential growth opportunities.

Next, include a summary of key financial figures like projected revenues, profits, and cash flows.

Finally, in the "ask" section, detail any funding requirements you may have.

2. The presentation of the company

In your diy and hardware store business plan, the second section should focus on the structure and ownership, location, and management team of your company.

In the structure and ownership part, you'll provide an overview of the business's legal structure, details about the owners, and their respective investments and ownership shares. This clarity is crucial, especially if you're seeking financing, as it helps the reader understand which legal entity will receive the funds and who controls the business.

Moving on to the location part, you'll offer an overview of the company's premises and their surroundings. Explain why this particular location is of interest, highlighting factors like catchment area, accessibility, and nearby amenities.

When describing the location of your diy and hardware store, you could highlight its accessibility to potential customers. You might point out that it is located in a busy area, with easy access to major roads and highways. You could also emphasize the potential for growth and development in the surrounding area. Additionally, you may note the potential for increased foot traffic due to the presence of other businesses in the vicinity. In addition, you could highlight the benefits of its location such as nearby parking, easy access to public transportation, and its proximity to other local businesses. Ultimately, you could emphasize the potential for your diy and hardware store to become a successful venture in the area.

Finally, you should introduce your management team. Describe each member's role, background, and experience.

Don't forget to emphasize any past successes achieved by the management team and how long they've been working together. Demonstrating their track record and teamwork will help potential lenders or investors gain confidence in their leadership and ability to execute the business plan.

3. The products and services section

The products and services section of your business plan should include a detailed description of the offerings that your company provides to its customers. 

For example, your diy and hardware store could offer customer service for specialized projects, such as installation services for products like ceiling fans and window treatments. It could also provide a range of materials for do-it-yourself projects, like paint, tools, and lumber. Finally, the store could offer a variety of home improvement classes, such as basic carpentry, electrical work, and plumbing. These services and products could help customers complete their projects with the right materials and knowledge, providing them with a finished product that meets their needs and expectations.

When drafting this section, you should be precise about the categories of products or services you sell, the types of customers you are targeting and how customers can buy them.

4. The market analysis

When outlining your market analysis in the diy and hardware store business plan, it's essential to include comprehensive details about customers' demographics and segmentation, target market, competition, barriers to entry, and relevant regulations.

The primary aim of this section is to give the reader an understanding of the market size and appeal while demonstrating your expertise in the industry.

To begin, delve into the demographics and segmentation subsection, providing an overview of the addressable market for your diy and hardware store, key marketplace trends, and introducing various customer segments and their preferences in terms of purchasing habits and budgets.

Next, shift your focus to the target market subsection, where you can zoom in on the specific customer segments your diy and hardware store targets. Explain how your products and services are tailored to meet the unique needs of these customers.

For example, your target market might include homeowners who are passionate about DIY projects. These homeowners are looking for high-quality tools and materials to complete their projects. They typically have a budget to invest in the necessary equipment, and they want to buy from a trusted supplier.

In the competition subsection, introduce your main competitors and explain what sets your diy and hardware store apart from them.

Finally, round off your market analysis by providing an overview of the main regulations that apply to your diy and hardware store.

5. The strategy section

When writing the strategy section of a business plan for your diy and hardware store, it is essential to include information about your competitive edge, pricing strategy, sales & marketing plan, milestones, and risks and mitigants.

The competitive edge subsection should explain what sets your company apart from its competitors. This part is especially key if you are writing the business plan of a startup, as you have to make a name for yourself in the marketplace against established players.

The pricing strategy subsection should demonstrate how you intend to remain profitable while still offering competitive prices to your customers.

The sales & marketing plan should outline how you intend to reach out and acquire new customers, as well as retain existing ones with loyalty programs or special offers. 

The milestones subsection should outline what your company has achieved to date, and its main objectives for the years to come - along with dates so that everyone involved has clear expectations of when progress can be expected.

The risks and mitigants subsection should list the main risks that jeopardize the execution of your plan and explain what measures you have taken to minimize these. This is essential in order for investors or lenders to feel secure in investing in your venture.

Your DIY and hardware store faces a variety of risks. For example, you could encounter financial losses due to stock theft or shoplifting. Such occurrences may lead to a decrease in profits, making it difficult to stay in business. Additionally, your store could also be at risk of property damage. Natural disasters like floods, hurricanes, or earthquakes could lead to significant losses if your store’s building or its contents are damaged. It is important to remain vigilant and take steps to mitigate these potential risks.

6. The operations section

In your business plan, it's also essential to provide a detailed overview of the operations of your diy and hardware store.

Start by covering your team, highlighting key roles and your recruitment plan to support the expected growth. Outline the qualifications and experience required for each role and your intended recruitment methods, whether through job boards, referrals, or headhunters.

Next, clearly state your diy and hardware store's operating hours, allowing the reader to assess staffing levels adequately. Additionally, mention any plans for varying opening times during peak seasons and how you'll handle customer queries outside normal operating hours.

Then, shift your focus to the key assets and intellectual property (IP) necessary for your business. If you rely on licenses, trademarks, physical structures like equipment or property, or lease agreements, make sure to include them in this section.

You may have key assets such as the physical location of the store, and any products that you sell. Additionally, you could have intellectual property such as any logos, slogans, or designs that you have created. These might be used to create brand recognition and loyalty among your customers.

Lastly, include a list of suppliers you plan to work with, detailing their services and main commercial terms, such as price, payment terms, and contract duration. Investors are interested in understanding why you've chosen specific suppliers, which may be due to higher-quality products or established relationships from previous ventures.

7. The presentation of the financial plan

The financial plan section is where we will include the financial forecast we talked about earlier in this guide.

Now that you have a clear idea of the content of a diy and hardware store business plan, let's look at some of the tools you can use to create yours.

What tool should I use to write my diy and hardware store's business plan?

In this section, we will be reviewing the two main options for writing a diy and hardware store business plan efficiently:

• Using specialized software,
• Outsourcing the drafting to the business plan writer.

Using an online business plan software for your diy and hardware store's business plan

Using online business planning software is the most efficient and modern way to write a diy and hardware store business plan.

There are several advantages to using specialized software:

• You can easily create your financial forecast by letting the software take care of the financial calculations for you without errors
• You are guided through the writing process by detailed instructions and examples for each part of the plan
• You can access a library of dozens of complete business plan samples and templates for inspiration
• You get a professional business plan, formatted and ready to be sent to your bank or investors
• You can easily track your actual financial performance against your financial forecast
• You can create scenarios to stress test your forecast's main assumptions
• You can easily update your forecast as time goes by to maintain visibility on future cash flows
• You have a friendly support team on standby to assist you when you are stuck

If you're interested in using this type of solution, you can try The Business Plan Shop for free by signing up here .

Hiring a business plan writer to write your diy and hardware store's business plan

Outsourcing your diy and hardware store business plan to a business plan writer can also be a viable option.

Business plan writers are experienced in writing business plans and adept at creating financial forecasts without errors. Furthermore, hiring a consultant can save you time and allow you to focus on the day-to-day operations of your business.

However, hiring business plan writers is expensive as you are paying for the software used by the consultant, plus their time, and their profit margin of course.

From experience, you need to budget at least £1.5k ($2.0k) excluding tax for a complete business plan, more if you need to make changes after the initial version (which happens frequently after the initial meetings with lenders or investors).

You also need to be careful when seeking investment. Investors want their money to be used to grow the business, not spent on consulting fees. Therefore, the amount you spend on business plan writing services (and other consulting services such as legal services) needs to be negligible relative to the amount raised.

The other drawback is that you usually don't own the business plan itself: you just get the output, while the actual document is saved in the consultant's business plan software - which makes it difficult to maintain the document up to date without hiring the consultant on a retainer.

For these reasons, outsourcing the diy and hardware store business plan to a business plan writer should be considered carefully, weighing both the advantages and disadvantages of hiring outside help.

Ultimately, it may be the right decision for some businesses, while others may find it beneficial to write their business plan using online software.

Why not create your diy and hardware store's business plan using Word or Excel?

I must advise against using Microsoft Excel and Word (or their Google, Apple, or open-source equivalents) to write your diy and hardware store business plan. Let me explain why.

Firstly, creating an accurate and error-free financial forecast on Excel (or any spreadsheet) is highly technical and requires a strong grasp of accounting principles and financial modelling skills. It is, therefore, unlikely that anyone will fully trust your numbers unless you have both a degree in finance and accounting and significant financial modelling experience, like us at The Business Plan Shop.

Secondly, relying on spreadsheets is inefficient. While it may have been the only option in the past, technology has advanced significantly, and software can now perform these tasks much faster and with greater accuracy. With the rise of AI, software can even help us detect mistakes in forecasts and analyze the numbers for better decision-making.

And with the rise of AI, software is also becoming smarter at helping us detect mistakes in our forecasts and helping us analyse the numbers to make better decisions.

Moreover, software makes it easier to compare actuals versus forecasts and maintain up-to-date forecasts to keep visibility on future cash flows, as we discussed earlier in this guide. This task is cumbersome when using spreadsheets.

Now, let's talk about the written part of your diy and hardware store business plan. While it may be less error-prone, using software can bring tremendous gains in productivity. Word processors, for example, lack instructions and examples for each part of your business plan. They also won't automatically update your numbers when changes occur in your forecast, and they don't handle formatting for you.

Overall, while Word or Excel may seem viable for some entrepreneurs to create a business plan, it's by far becoming an antiquated way of doing things.

• A business plan has 2 complementary parts: a financial forecast showcasing the expected growth, profits and cash flows of the business; and a written part which provides the context needed to judge if the forecast is realistic and relevant.
• Having an up-to-date business plan is the only way to keep visibility on your diy and hardware store's future cash flows.
• Using business plan software is the modern way of writing and maintaining business plans.

We hope that this practical guide gave you insights on how to write the business plan for your diy and hardware store. Do not hesitate to get in touch with our team if you still have questions.

Also on The Business Plan Shop

• In-depth business plan structure
• Key steps to write a business plan?
• Free business plan template

Know someone who owns or wants to start a diy and hardware store? Share this article with them!

Founder & CEO at The Business Plan Shop Ltd

Guillaume Le Brouster is a seasoned entrepreneur and financier.

Guillaume has been an entrepreneur for more than a decade and has first-hand experience of starting, running, and growing a successful business.

Prior to being a business owner, Guillaume worked in investment banking and private equity, where he spent most of his time creating complex financial forecasts, writing business plans, and analysing financial statements to make financing and investment decisions.

Guillaume holds a Master's Degree in Finance from ESCP Business School and a Bachelor of Science in Business & Management from Paris Dauphine University.

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Hardware Retail Franchise Business Plan

Start your own hardware retail franchise business plan

Hisarlik Hardware

Executive summary executive summary is a brief introduction to your business plan. it describes your business, the problem that it solves, your target market, and financial highlights.">.

Last year  Wilusa Magazine surveyed current downtown residents and found that hardware stores are one of the top ten things needed to make downtown a great place to live.  The same reasons that make downtown a great place to live also make it a great place to work. 

The demographics of home ownership have changed radically in downtown Indianapolis.  Today’s hardware store, which more and more is dominated by the “big box stores”, is cold, uninviting, and usually involves substantial driving time from downtown Wilusa.  Hisarlik Hardware is uniquely positioned to take advantage of this new fact of life.  Conveniently located to serve the Troas, Sinope Bay, Miletus Square, and Lycia areas, as well as all of Arazawa Township, Hisarlik Hardware offers parts, materials, and advice to tackle any home or do-it-yourself (d-i-y) project, whether the customer is a complete novice or a contractor.  The focus is on helping the customer identify what they want and need as soon as they enter the store. 

Through the use of superior personal customer attention, great product selection, and reasonable prices, Hisarlik Hardware will capitalize on this promising opportunity.  A location is being secured that offers excellent traffic with a built-in magnet for urban dwellers–downtown’s only grocery store sharing the parking lot.  The Building Blocks parent organization will help efficiently lay out and plan the store to increase sales and give the customers the utmost in attention.  Hisarlik’s management team has a wealth of business, financial, and mechanical experience that will ensure a great investment and the overall success of the venture.  The projected growth rate for Hisarlik Hardware is quite steady and has the potential to grow exponentially along with the increase in residential development downtown. 

Hisarlik Hardware will produce positive cash flow its first year of operations.  Hisarlik will also produce a net profit in its first year of operations.

1.1 Objectives

There are four major objectives of this business plan, of which three are immediate and the fourth is of a longer-term nature.

• Determine the feasibility of a downtown hardware store.
• Develop the strategy to open, manage and grow a profitable downtown hardware store venture.
• Establish a firm budget to operate and manage the business from concept to start up to operation, with good cash flow and consistent profits.
• Explore potential growth in downtown market and evolve new sources of business.

1.2 Mission

Hisarlik Hardware’s  mission is to create a downtown hardware store that is reliable and convenient.  A store that offers great service and selection of hardware and home improvement products in a customer friendly environment.

Hisarlik Hardware will cater to downtown residents, downtown property managers, downtown businesses, contractors, and suburban commuters.  Our customers will become loyal because of the great advice, prompt service, good staff attitudes, the overall quality of the shopping experience, and the fact that we consistently have solutions for their needs.

1.3 Feasibility of the Business

Hector Priamson and Troy Enterprises went through a long and thorough process of looking at different business ventures that would allow them to go into business and be a long-term success.  Through this process retail hardware became a potential opportunity.  The following items are considered “must have” items in order to make Hector Priamson and Troy Enterprises  not only feasible, but a tremendous success. 

• An industry that is healthy, resistant to economic swings, and allows an entrepreneur to influence the stores results.
• A market that can deliver the kind of potential that will allow a store to be profitable.
• A store location that will be easy for customers to find, allow easy access, plenty of parking and have economic terms that allow the store to be successful. 
• A successful and cooperative “partner”, such as Building Blocks, a national hardware co-operative, that will help research, plan, market, and operate a hardware store.
• A financial package that would allow the business to begin operations and operate in terms that would be realistic and successful for all involved whether it was private investors or the bank.
• Participants must possess the business skills, a strong work ethic, and a level of competitiveness required to make the business a success. 

Building Blocks  provides all of the tools and Hector Priamson possesses the financial, entrepreneurial, mechanical, and management skills needed to be successful in this business. 

1.4 Keys to Success

• Hardware Industry:   The Home Improvement industry has been consistently growing at a rate of 7% per year for the past decade according to the US Department of Commerce, with total US Sales of over $313 billion in 2002. While the economy has fluctuated up and down over the past decade, the growth of the hardware industry has continued to grow at the same pace.  The “Big Box” stores have also created a “Do-it-yourself” mentality in this country, a mentality that has a positive effect on the independent hardware store.
• Location:   The proposed location for  Hisarlik Hardware  is Troas Marketplace, a retail and commercial property on the corner of E. Anglia St. between N. Umberland St. and N. Mercia Blvd.  Troas Marketplace primary tenants are Scamander’s Food Market located across the parking lot and Buckbasket Cleaners adjacent to the proposed site.  Scamander’s is a huge draw.  Scamander’s is the only grocery store in downtown Wilusa.  The location of this store is known to all downtown residents, one block from the trendy and hip Wessex Avenue.  The Troas Marketplace offers plenty of parking, very important for a downtown location, as well as easy access to the parking lot from E. Anglia St. or N. Mercia St.  E. Anglia St. is a major eastbound thoroughfare east of downtown.
• Urban Products:  The location in downtown Wilusa will require a different product mix than a suburban store.  There will be a unique product demand from urban dwellers.  Building Blocks will be a big part of determining the mix of products that will be right for the urban market through their IAIS program (Inventory Always In Stock).  Hisarlik Hardware will be in touch with, and focus on, the downtown urban market, delivering products that are applicable to local customers, and marketing these items at competitive prices.
• Commercial Customers:    Hisarlik Hardware will also focus on becoming the hardware products source for every building and business in downtown Wilusa.  We will work hard to establish relationships with property managers and service personnel.  There are also plans to set up a delivery service to the downtown business market making it even easier for customers to get the products they need, when they need them.  While Hisarlik Hardware may be convenient and easy to access, potential customers may not find it to be convenient to leave their offices.  There will be an emphasis to establish business accounts for each of these customers to make doing business easy for them.
• Building Blocks :  It is crucial to have a co-op like Building Blocks behind efforts to open a store like Hisarlik Hardware .  They provide all of the tools to be successful in the hardware business including research, floor plans, marketing, and systems and instructions for operating a hardware store.  To become a Building Blocks Member (Member of the Building Blocks Co-op) really means they will provide an entrepreneur a “business in box”, yet allow the members to control their own business.  There are extensive marketing programs that have been built based on input from members to help generate sales, increase traffic and ultimately increase profits.
• Repair/Project Resource Area:   Hisarlik Hardware will leverage the strength of an established reputation for superb service built by other Building Blocks Co-op member stores.  It is a reputation that has positioned Building Blocks to be the leading independent hardware stores (from Consumer Checkbook , Aug 2003), and filling the gaps in the “Big Box” retailers one-size-fits-all offerings.  The Resource area will allow the customer to ask for help or directions as they enter the store.  This area will also offer assistance as they start a project, help in finding what they need, sharing know-how in completing a project, and advice on how to get a project done.  Store employees will be knowledgeable in home repairs/projects, home improvement, and mechanical repair and retro-fit.  In addition, the resource area will be used to conduct short training sessions and demonstrations in home repair and home improvement projects.
• The Tool Room Rental :   A rental business will be established under the Building Blocks’ “The Tool Room Rentals” tool rental program.  This will not only help with the initial cash flow, but will also be a source of additional sales as every tool will need accessories to go with the rental.  We will also think about party rental items to be included in the rental inventory.  Building Blocks will aid in developing the right rental product mix for this urban market.

All of these keys will be combined to drive sales and ultimately the bottom line…net profit.

Company Summary company overview ) is an overview of the most important points about your company—your history, management team, location, mission statement and legal structure.">

In the company summary section, we will review the Troy Enterprises business and corporate entity and ownership, the role of Building Blocks in the business, the proposed location, and the start-up costs and funding.

2.1 Start-up Summary

Hisarlik Hardware has worked very closely with Building Blocks Hardware  to establish a detailed start-up cost list.  Building Blocks’ knowledge, track record and expertise have been invaluable in setting up this venture.

2.1.1 Start-up Expenses

The start-up costs of Hisarlik Hardware,  as detailed below, will consist primarily of inventory, equipment and fixtures.  Hector Priamson will invest cash, benefits and labor to the start up.  Investors will contribute substantially.  The company will secure an SBA 7(a) loan to be paid back on a 7-year amortization.

There is an amount budgeted for leasehold improvements which is intended to make minor modifications to the proposed site to prepare it for opening.  These improvements include replacing missing ceiling tiles and cleaning, polishing, or redoing the floor tile.  It is anticipated that the new floor tile can be laid over the existing tile at a substantial savings with no loss in quality or durability.

2.2 Building Blocks’ Role

With the merger of Kadmus, Homer & Company and Delphi/Ouroboros,  Building Blocks  is a cooperative comprised of members who are entrepreneur-retailers.   Building Blocks  is committed to empowering the independent retailer by setting industry and market standards with their niche businesses and unique brand of creative marketing, wide product assortment, award winning merchandising and technology, and quality training and business expertise.   Building Blocks’  buying power of more than $2.5 billion annually helps pass on benefits to independent members. 

Building Blocks has been a world leader in the hardware industry in product selection and customer service for do-it-yourselfers since 1948.

Vision To be the best-in-class provider of products and solution choices that drive our members’ and our co-op’s profitability.  Mission To provide: Choices of retail and commercial solutions to drive members’ sales and profits Assortments to support the solutions Operational excellence in the delivery of products and solutions

2.2.1 Market Reseach

Building Blocks has a wealth of experience and know-how on opening new hardware stores, with 6,567 stores worldwide.  Building Blocks has become a leader in determining what factors make a hardware retailer successful. 

Building Blocks currently uses a service called Yorikle.  This service is used to define the demographics and the expenditure potential of new markets.  For Hisarlik Hardware , the report was run on a one-, two-, and three-mile radius around the proposed location.  The report showed an exceptional amount of business (only reporting households, the study does not include property managers, businesses, or commuters), especially considering that there is no direct competition in the area.  The reports also get very specific as far as what the potential market is for hardware overall as well as specific categories within a store.  There are also numbers reports for the expected growth in the area over the next five years.

2.2.2 Planning

Building Blocks supplies professional design services to maximize merchandisable space and traffic flow.  Services include fixture plans, interior signage and decor, merchandising plans, lighting, basic site plans, and exterior storefront elevations. These plans are custom developed for each location and each store’s footprint.  The associated costs are included in the start-up costs.

A unique plan will be done for the proposed site for Hisarlik Hardware .  This process will begin as soon as the lease for the property is signed.

2.2.3 Support

Building Blocks provides a variety of support to all current members as well as prospects seeking to join the co-op.  The support comes to members in the form of retail consultants, knowledge, profit building programs, retail automation, training, advertising & promotion, a national brand, buying power, semi-annual markets, and an operations and distribution network.

Retail Consultant

Every member and prospect is assigned a retail consultant who works with them on an ongoing basis.  There is also a retail operations specialist who helps prospects open new stores.  There are regional marketing staff that are available as well as individual Building Blocks staff for individual marketing programs.

All specialists share their wealth of personal knowledge as well as having access to  Building Blocks’ cumulative knowledge and experience.  Building Blocks has made this model work since 1948.  It works very well and enables members to be very successful business people and has made Building Blocks the largest retail hardware co-operative in North America.

Proven Profit Building

Building Blocks makes available a large number of programs that entrepreneurs can choose to participate in.  They include retail pricing systems, electronic order entry systems, commercial and industrial sales, category specific planograms, and direct mail circulars, just to name a few. 

2.2.4 Retail Automation

Building Blocks leads the industry in automating their stores.  Building Blocks has brought their stores into the future with the automation which is made available to members.  This is a strength of Building Blocks and a service that is available to all of their members.  This automation helps the members in many different ways including inventory control, ordering, sales, and accounts receivable, all tied together in one system called Delian .

Experienced technical support personnel work with members to ensure current retail automation capabilities are compatible with Building Blocks’ existing system.  Building Blocks’ existing system is Delian, an industry leading software program based on Triad Eagle for Windows platform.   Delian is an easy-to-use, easy-to-learn tool that contains up-to-the-minute ordering and inventory accuracy, point of sale, accounts receivable, and much more.  It contains all the daily business tools needed to manage Hisarlik Hardware .

• Inventory:  Building Blocks’ industry leading retail merchandise approach is designed to organize a store’s departments, maximize space by removing non-selling inventory, ultimately freeing up valuable floor space.  This unique concept accommodates the needs of customers by featuring the right merchandise assortment proven to increase overall profits.  Category specific guidelines and planograms maximize retail sales and inventory turns.  IAIS is based on the best selling items from the most successful Building Blocks stores.
• Ordering:  Building Blocks has made ordering easy.  The Delian program helps track the needs and generates the necessary inventory levels.  Orders can be placed through the Building Blocks e lectronic order Entry System. 
• Pricing:  Building Blocks’ Retail Pricing System enhances the ability of each store to maintain a competitive price image while maximizing profitability.  Building Blocks’ Retail Consultant will help establish retail pricing which results in increased sales opportunities and profit margins based on downtown Wilusa. 

2.2.5 Training

Building Blocks has educational programs which they call Building Blocks University .  Programs have been growing year after year and last year they offered certificate programs for new members.  There are four required courses and four Building Blocks University workshops and seminars.  There is also required course work for any member that is opening a The Tool Room Rentals as part of their program. 

There are five core programs for new store owners which make up the initial training.  They are:

• Certificate of Business Management
• Certificate of Marketing Management
• Certificate of Ownership Management
• Certificate of Retail and Sales Management
• Certificate of Human Resource Management

When a member opens a The Tool Room Rentals business there is also required training that applies only to The Tool Room Rentals .  There is also a wide range of do-it-yourself programs that are on CD-ROM and video.

2.2.6 Advertising and Promotion

Building Blocks’ marketing programs are second to none in the industry.  They include every tool needed to be successful in the retail hardware business.  They include Power Events, interior and exterior signage, online programs, and custom circulars.

Every member store is assigned a field marketing manager.  The marketing manager makes the members aware of the marketing tools available and how best to use them.

There are marketing strategy programs, programs that increase traffic, increase transactions, and those that merely build the brand.  All are made available, and it is the savvy member who uses the right programs and spend their advertising dollars best.  Based on the marketing experience  Hisarlik Hardware has, this is a strength most start-up businesses do not possess.

• Marketing Strategies:  The field marketing managers work with each member to determine the needs and issues for each store.  They look at the market penetration and awareness in the market.  As this information is gathered, a list of strengths and weaknesses is developed and programs designed to work on each of the objectives.  A very basic local store marketing tool kit is given to each member.  This is designed to show members what has been successful and basic marketing information that can be used on the local level.  There are also national programs that support what is done on a local level.  They include national television, radio, and newspaper.
• Increasing Traffic:  Building Blocks has also developed programs designed to drive traffic to the stores.  They include bargain of the month, circulars, Yellow Page programs, and local television, radio and newspaper.  Circulars play a huge role in local advertising.  There are three ways to get the circulars in the hands of the consumer, newspaper insertion, ADVO circular distribution and direct mail.  Each of these programs have different costs associated with them and different penetration in the market.  Circulars can be designed for an individual store.  They are all customizable and can be generated in any volume necessary.  Building Blocks also plans four Power Events throughout the year which are nationally advertised programs supported by television, radio and print.  In 2003, Building Blocks saw a significant increase in traffic and bottom line during each of the Power Events.
• Increasing Transactions:  Programs have been developed to increase the amount of each transactions.  There are display shelving end caps, wing panels, and clip strips that help increase sales on these specially priced items.  There are also online sign making programs that help members produce professional signs and save money on creative and printing jobs.  Muzak is a program of in-store audio and messaging which customers cannot ignore, and that drives them to specials and promotions they may not have been aware of.
• Brand Building:   The brand building programs are designed to reinforce the established Building Blocks name, both on the interior and exterior of the store.  Programs have also been designed for vehicle graphics.

2.2.7 National Brand

For over 40 years, the name Building Blocks has stood for trust, service and fair prices.  Building Blocks’  brand positioning statement is “ Building Blocks is the best place to get just what you need to complete home repair and maintenance projects quickly and easily.”  It is a name with heritage and integrity.  Consistent national media and the fact that Building Blocks is the largest co-op of independent hardware store owners, has established Building Blocks as a recognizable name in retail hardware.

The bottom line is people know that the Building Blocks name means hardware.  That is an asset new businesses work for years to establish.

2.2.8 Buying Power

An independent hardware store cannot compete in the current market, without a co-op behind them.  A Building Blocks member has the benefit of $2.5 billion in buying power which is passed on in savings and profits.  That makes Building Blocks the largest co-op of its kind in North America.

This is the main factor in making sure all Building Blocks members are getting products at the best possible prices to enable them to maximize profits.

2.2.9 Semi-Annual Markets

Building Blocks holds semi-annual markets where members can buy products and plan purchases for the upcoming seasons.  Markets are held in March (Fall/Winter) and October (Spring/Summer).  Members are informed of new items and trends in the industry at these markets enabling them to make good purchasing decisions.  There are also programs which allow members to make purchasing commitments at large cash savings.

2.2.10 Operations and Distribution Network

Building Blocks has established a network of strategically placed distribution centers throughout the United States to assure timely deliveries regardless of where the store is located.  Trucks deliver at least once per week and twice if necessary.  This is a huge benefit, because this process allows excess inventory to sit in the distribution center as opposed to the store shelves.  Over 64,000 items can be purchased on a per piece basis enabling stores to get whatever quantity is needed at any time.

2.3 Company Ownership

Troy Enterprises, Inc.  is a privately-held S corporation, currently 100% owned by its founder and president, Hector Priamson and his wife Andromache Eetion.  The company will be operating under the name of Hisarlik Hardware.   There are expected to be investors in the new venture.  Individual investors will own no more than 15% of Troy Enterprises, Inc.   These investors will provide investment in the way of seed cash to help start the business and none of the investors will be active participants in any management decisions. 

In order to make Troy Enterprises, Inc.  financially viable, there are three major factors necessary to get the business up and running.  First, a feasible concept.  We have found that with Building Blocks in the downtown Wilusa market.  Second, the business needs someone to manage it.  It needed a professional with a good deal of experience to operate and manage the business.  This manager needs a sound financial background as well as an entrepreneurial spirit.  Third, the business needs financial support.  This support will come from three different sources.  Hector Priamson will invest time and some capital to start the business.  There is a need for investors to help with the initial capital to allow the business to have enough equity to get off the ground.  The final piece of financial support is the faith and commitment of a financial institution to loan the remaining funds that are needed to operate the business.

2.3.1 Hector Priamson

Troy Enterprises, Inc. founder and president is Hector Priamson.  Hector is a resident of Ilion.  He is married to Andromache Eetion who is currently a realtor with Ahhiyawa, Hatti & Company. 

Hector will spend 100% of his time on this new start-up venture.  Hector has a wealth of experience in business.  He started his career straight out of college with a very exclusive “Big Eight” Accounting firm.  While with  Manapa Tarhunda and Co. Hector earned his CPA license.  His interests led him to Wilusa, where he became involved in one of the city’s unique industries, Samothracing.  He started on the accounting side of the racing business and soon broke out into the part of the business that generates the revenue, sponsorship sales. 

His career led him to Trireme Racing Group where he served as the Vice President of Business Operations.  He led the turn-around of this team and company solidifying major sponsorships with companies like Corinthian Leather, Medusa-Gorgon Oars, and Posidon Libations.  He served in that position from 1996 through 2001.  During that period of time, Hector also served on the CURRAGH Franchise Board (rules making board of the sanctioning body).  His reputation and success led him to the top marketing position, Vice President of Sales and Marketing.  Hector served in that capacity from December of 2001 through July of 2003, at which time he left the company to pursue his current business,  Troy Enterprises, Inc. 

Hector’s expertise in the entrepreneurial business of oarsports will be invaluable in his new venture.  He has a keen sense of finance, marketing, management of inventory, accounting and bookkeeping practices, and staff management.  This experience will be invaluable in leading Troy Enterprises and making sound business decisions in the future.

Hector’s resume, as Confidential and Proprietary information, has been omitted from this sample business plan.

2.4 Company Locations and Facilities

When Hisarlik Hardware began this project the key component was the location.  Hector Priamson/Troy Enterprises and Building Blocks  felt several criteria were crucial to making this venture a success.  The ideal size was determined to be between 7,500 and 10,000 sq.ft.  The price per square foot was important because the economics obviously had to work.  Adequate parking and easy access were must-have criteria while searching for locations.  A location with only street parking was not considered an alternative.  Being located on a major thoroughfare with visibility is important to get the store recognized as a solution for hardware.  Adequate signage that traffic can recognize is key.  Additionally, intangibles such as other commercial neighbors and the neighborhood makeup were considered. 

Based on these criteria, a site at 310 East Anglia Street is was selected.  It is part of the Troas Marketplace. 

This property shares a parking lot with Scamander’s Food Market and Buckbasket Cleaners which is the most important of the intangible factors.  This Scamander’s generates $12.0 million in revenue and is Scamander’s most successful store in Wilusa.  Scamander’s is the only grocery store in the downtown area, and is an icon in the downtown residential community.  In discussions with Scamander’s, they said the Troas store has much more traffic than their other locations.  They have found the average customer visits the Troas store every two days versus once a week for the others.  Hisarlik feels this is a huge advantage for its venture as this will drive more traffic, more often to the Troas parking lot.  Scamander’s is in the middle of its lease for this property and seems pleased with the results.  Hisarlik does not anticipate this advantage changing by a move by Scamander’s, whose lease extends through the year five. 

The proposed site has plenty of parking spots and excellent access from eastbound Anglia Street and northbound Mercia Blvd. 

Signage marquees sit on both streets as well as on the north, west, and south sides of 310 East Anglia Street.  Furthermore, the location is perfectly set on eastbound Anglia Street, which is one of the major thoroughfares.  There is a driveway entrance and exit to Anglia Street. 

The proposed site is ideal in size measuring 9,509 sq. ft. and was formerly an Osco Drug store that was closed as Osco downsized their Wilusa operations.  According to the landlord, the closing of this location by Osco had nothing to do with the location, but rather, a change in priority within the company.  The property needs very little in tenant improvements in order to be open for business.  The terms of the lease are currently being negotiated.  It is anticipated that Hisarlik Hardware  will retain the property within the budgeted guidelines.  There were many properties that were investigated; however, for the stated reasons this is the best option as of last November.

The neighborhood has gone through major renovation over the past 10 years.  It is now a rejuvenated upscale neighborhood.  There is also major new development around the proposed site.  There is a brand new condominium development directly across East Anglia Street.  The development is called Lemnos Square.

There are three other new condominium developments under construction that are one block away.  They are Troas Terrace, The Anatolia, and The Konya.

The proposed location is one block from the successful Wessex Avenue District.  Wilusa has done a fantastic job in bringing in new business and culture into this area of downtown.

According to Wilusa Downtown Inc., Downtown has seen record demand and occupancy levels, driving the surge of residential development.  This has led to more than 615 new residential units currently in the pipeline.

The city of Wilusa is also reviewing plans for the former Cressida Agora site.  The plans all include a large number of residential and retail sites on the 29 acre site.  This site is located 2 blocks south of the proposed location.

Development downtown is happening in many different ways.  There is commercial, residential, as well as government development currently in process or planned.  All of these things add to the desirable nature of the proposed site.  We would be “right in the middle of it.”

Products and Services

Hisarlik Hardware will offer traditional retail hardware.  These products include electrical supplies, automotive, hardware, housewares, lawn and garden, building supplies, paint, plumbing, tools and rental.  There are other small services that will be offered including key cutting, glass cutting, and other small repairs. 

Hisarlik will work with Building Blocks to develop the right product mix.  The initial order of inventory will take into account the fact that this is an urban store and the product mix may contain different items than a suburban store.  Hisarlik Hardware  will rely on Building Blocks’ expertise, knowledge, and their IAIS inventory management program in developing this initial order.

3.1 Product and Service Description

Hisarlik Hardware will stock traditional retail hardware items.  The product mix will be changed slightly from suburban stores.  The history of the store will then be used along with IAIS to develop the right product mix that takes advantage of the available square footage and maximizes profits.

Hisarlik Hardware will open a The Tool Room Rentals store within the hardware store.  This is a program that will help cash flow as well as increase sales of rental accessories and support items. 

Hisarlik will also have key cutting, glass cutting, and other small services like screen repairs.

IAIS stands for Inventory Always In Stock.  This is a program that was developed by Building Blocks based on feedback from their members.  The members were looking for assistance in managing their departments and knowing what is selling and what is not. 

This program has the following benefits to members who take part in it:

• ORGANIZE departments with a more consistent merchandise assortment
• REMOVE non-selling inventory
• FREE UP valuable floor space
• INCREASE a store’s overall profits.

Building Blocks delivers to member stores IAIS merchandising guides, assortment guides, and recommends what inventory to carry and what not to carry.

This is an invaluable tool for a new member because the new store can rely on the history of current stores to help in their merchandising.

3.1.2 Retail Pricing System

Hisarlik Hardware will once again rely on Building Blocks to deliver the correct pricing for the market.  As discussed earlier, low cost is not one of the main factors for customers to shop at a convenient hardware store location.  Hisarlik will continue to work with Building Blocks to charge the right price to maximize profits.

3.2 Future Products and Services

Hisarlik Hardware will listen to its customers to understand what other needs are not being met.  Those needs could include additional store locations in the future and an expansion of products and services offered at the current location.  There may be other businesses that can be offshoots of retail hardware that help service or provide convenience to Hisarlik customers.

Market Analysis Summary how to do a market analysis for your business plan.">

The Market Analysis looks at potential customers and potential business.   Hisarlik Hardware  explored the market segments, their needs, and did a marketing analysis. 

The need for this venture was looked at first.  Does downtown need a hardware store?  The answer was a resounding yes. 

Once the need was established,  Hisarlik needed to analyze the make up of its customers, who and how many.  Who is the potential customer?  How many potential customers are there?

Once it was determined that there was a need and who the customer is, the next step was to figure out how to make them  Hisarlik Hardware  customers.  How to get the potential customer in the store?

4.1 Market Segmentation

There are six major market segments:

• Downtown Residents:   Downtown Residents will make up as much as 40% of the potential business of the store.  This is an ever growing and expanding group.  Downtown Resident levels are at an all-time high.  There are also major projects like the former Cressida Agora site and the Troilus Townhomes in downtown Wilusa that will increase the numbers of residents.  Wilusa Downtown, Inc. estimates there are currently 615 new residential units currently in the pipeline.  In addition, 91 renovation permits were issued last year on existing downtown residential structures.
• Property Managers:   Every residential building and every commercial building downtown has a property manager that keep the properties in good repair.  These property managers all need supplies and materials that are conveniently available.  These managers will be able to rely on Hisarlik Hardware to stock what they need.  Hisarlik feels the store will prove to be a quick, easy, and convenient way to fulfill the needs of these property managers.  Hisarlik and Building Blocks both feel paint and paint supplies will be a big percentage of what these property managers will buy.  The City of Wilusa estimated there was $18.0 million in paint and wallpaper Retail Sales in 2002 (within a three mile radius of the proposed location).
• Contractors:   As stated earlier, there were 91 renovation permits and 615 new residential units under construction in the last year.  The new residential units represented $261 million investment in downtown.  Hisarlik Hardware  will work to become a reliable supplier to these contractors working in the area.  We will also open early in the morning to help supply and be a convenient source for the contractors who start work early each day.
• Downtown Business:   Every downtown business will need supplies from time to time.  The City of Wilusa states there are 2,861 businesses located within one mile of the proposed location.  As of the time of opening the focus will be to sell this group traditional retail hardware supplies.  As the business is established, Hisarlik will work to develop the Commercial Supply Network  for these businesses.
• Suburban Commuters:   Since the proposed location is on a major Eastbound thoroughfare (E. Anglia Street) out of the downtown, the potential is encouraging for Suburban Commuters to stop on their lunch hour or on their way home from work.  Research tells us that these commuters will be in search of good service and convenient shopping, things they may not find in their suburban neighborhoods.
• Commercial Sales:  This could be the largest growth area of business that Hisarlik Hardware  will have.  As Hisarlik develops a positive reputation, there will be a push to activate the MRO ( Building Blocks’ commercial and industrial supply network).  Once again with so many businesses located downtown there is an infinite amount of business.  There are also a large number of Federal, State and Local government entities located downtown.  These is also one major university and several major hospitals within two miles of the proposed location.

4.2 Target Market Segment Strategy

Each market segment is unique and requires different marketing to attract them.

• Downtown Residents:   The proposed location really takes care of this segment by itself.  Because the proposed location shares the parking lot with Scamander’s (the only grocery store downtown) it will act as a magnet to bring people to Hisarlik Hardware .  Scamander’s estimates customers visit their store every 2-3 days, which is fantastic for traffic.  Based on discussions with Scamander’s they are willing to work with Hisarlik to develop co-op programs to work together to build both businesses.  There will also be direct mail programs and circulars to downtown residents to convert old habits as the business is started.  There will also be a Building Blocks loyalty program implemented called Building Blocks Rewards.  This program not only gives valuable research data, but also helps the store learn buying habits of the regular customers.
• Property Managers:   It is expected that this group also has a significant need for downtown hardware and will find the store by word of mouth.  Hisarlik will not rely on that.  There will be a sales program to set up accounts with property managers and let them know about great service that is available.  A list will be developed to pursue and court in order to build this business.  Keeping in mind this group is in search of convenience and ease of shopping, having a delivery option will also be important to this group.
• Contractors:   Hisarlik Hardware  will have to go out and pursue this group.  Hisarlik will have to visit job sites and let contractors know that Hisarlik is an option and the most viable option available.  Delivery and hours of operation will be very important to this group.
• Downtown Businesses:   There will be a direct mail program set up to make these businesses aware of the store and that it is an option for their hardware needs.  The key to this group is awareness.  They will also be looking for an easy and convenient way to get hardware items.
• Suburban Commuters:   The direct mail program to offer hardware convenience to businesses will also create awareness with the suburban commuters.  However, it is thought that the biggest attraction will be the outdoor signage.  There will be signs on E. Anglia St. and Mercia Blvd.  Both streets are high traffic areas and should create a good deal of awareness.  Awnings are also thought to be an option on the Anglia St. side of the building.  The color will not only be a change to what traffic is used to seeing but also exposure for the business. 
• Commercial Sales:   This segment is going to come down to hard work.  It will require a dedicated sales person calling on potential customers and developing relationships with Commercial customers to turn this segment into a strong revenue stream.

4.2.1 Market Needs

Downtown residents have already expressed the need for a local hardware store, as is documented in the April 2003 issue of Wilusa Magazine .  Residents recognize the need and will be supportive of a retailer answering their concerns.  The data that has been supplied to  Hisarlik Hardware (by Yorikle, a market research firm used by Building Blocks ) shows there is a population of nearly 53,000 people and more than 20,000 households within two miles of the proposed location.  The analysis provided by Yorikle states the area could support a 19,000 sq. ft. store.  We are proposing a 9,500 sq. ft. store.  In other words, there is enough business in this area to support a store twice the proposed size.  The report has also found there is more than $2.5 million of potential sales revenue, based on the number of households alone (not including any of the other segments).  The potential is expected to grow to more than $3.0 million by 2007.

Hisarlik Hardware believes the key to the need analysis is that all of the research and potential was measured by households, and households only.  The households only make up one segment of the potential business the store expects to generate.

4.2.2 Market Trends

When Hector Priamson initially looked at the hardware business, one of the most important factors was the fact this industry seems to be immune to significant fluctuations in the economy.  Based on information from the US Department of Commerce, the home improvement retailing industry has consistently grown at a rate of 7% for the past decade and similar growth is expected for the foreseeable future. 

In the 1990’s the growth in the industry was attributable to strong home sales, economic prosperity, and significant amounts of home renovation.  Since 2000, growth has stayed at the same levels even though some of these factors have changed.  Growth since the year 2000 was attributable to low interest rates and refinancing.  According to the Federal Reserve Board, 35% of all refinancing goes to home improvement. 

What does the future hold?  93% of all Americans plan to stay in their current homes and 78% of homeowners plan to undertake home improvement projects in the next year.  How much will they spend?  69% of homeowners plan to spend as much or more in the coming year than they did last year.  Home improvement budgets have grown 31% since the year 2000.

4.3 Service Business Analysis

Hisarlik Hardware  is being encouraged by Building Blocks to enter the equipment and party rental business upon opening the store.  Based on conversations with other members, the rental component has been an overwhelming success adding to cash flow of the business as well as increasing traffic to the store.  Reports of success unanimously talk about the fact that “renters” need tools and accessories to go with the rental equipment adding to the overall profitability of the store. 

In the downtown market, the make-up of the rental inventory will vary a bit from what a suburban store might have.  Hisarlik Hardware will work with the Building Blocks Rental people to determine the inventory.  Hisarlik will rely on the knowledge and expertise of Building Blocks.

An investmentm is required upon opening for the initial purchase of the equipment to rent.  Building Blocks has the necessary training and computer support to make this a very logical addition to the traditional hardware store.

4.3.1 Competition and Buying Patterns

The “Big Boxes”, such as Lowe’s, Menard’s, and Home Depot have had a significant effect on the Home Improvement industry.  According to the National Retail Hardware Association, based in Wilusa, the Big Boxes have expanded the market, increasing consumer participation in home improvement.  However, the National Retail Hardware Association feels that the Big Boxes are nearing a saturation point, and in the future, they cannot open many more stores without it affecting and threatening other current Big Box locations. 

“This competition has not kept independent hardware stores, home centers, and lumberyards from prospering.  These stores are much more professionally operated than they were just a decade ago, and most posted strong profits last year.” —NRHA, 2004 Market Measure

Independent Hardware stores need to focus on their strengths. 

Service.   88% of consumers have a favorable opinion of small business vs.  61% for big business (the lowest since 1993). 

Convenience.   Consumers want to get everything they need in one trip to the store.  The Independent hardware stores are able to do this, because they work with their customers. 

“There are four ways to compete

• Assortment & Variety
• Service & Experience
• Convenience

But price is only one of them.” —M.  Chandler, a retail industry consultant

4.3.2 Main Competitors

There is no immediate local competition.  The nearest hardware store is 1.8 miles away on South Hasan Dag Avenue.  The store is a small, 4,000 sq.  ft., and isn’t current in its products or presentation.

Because of the lack of product and poor shopping presentation, residents do not consider this an option for hardware.  The next closest hardware store is 2.7 miles away.  There are several stores that are 3 to 4 miles from the proposed site.  Studies say customers do not want to travel more than 3-7 minutes to a location.  While these stores could serve the need, their location does not make them a viable option to downtown residents because of distance and neighborhoods. 

The “Big Box” stores such as Lowe’s, Home Depot, and Menard’s are built to serve suburban Wilusa.  The closest Lowe’s is 12.5 miles and 17 minutes west of  Hisarlik Hardware’s proposed location.  The nearest Home Depot is 10.5 miles or 16 minutes west of Hisarlik .  Menard’s is 9.3 miles and 14 minutes east of the location.  There are no stores that are convenient to the downtown market.  To get to any of these, customers must plan on spending 30-40 minutes of driving roundtrip at a minimum before even walking into the store.  Hisarlik Hardware will be a 2-3 mile drive or 5-10 minutes maximum travel to the store.  This convenience will be a major selling point for the business. 

From discussions between Hisarlik Hardware and the parent company of Building Blocks , regarding the possibility of a “Big Box” store opening in the downtown area, it seems unlikely due to the size of the potential market, cost, and lack of real estate, to build such a structure in Arazawa Township.

An analysis of competitors in the equipment and party rental field is similar to that of the hardware industry.  There is one competitor that is southeast of downtown, 1.5 miles from the proposed location.  The company, Best Rentals, Inc., handles equipment and party rentals. 

Tent rental has one competitor that is downtown.  An factor in tent rental may be the clean new equipment and, once again, great service available from Hisarlik .  American Tent and Awning is located 1.8 miles from the proposed location.  One advantage for Hisarlik in tent/party rental is that a customer can cover more bases with the variety of equipment and supplies from a rental and hardware store versus a company that focuses solely on tent rental. 

The closest tool rental company is 2.3 miles from the proposed location.  Hisarlik Hardware  feels that significant progress can be made into the tool rental business because of convenience.  Hisarlik expects to be a fantastic solution for contractors working downtown who need equipment for the day or for the project.  Residents downtown have smaller homes and condominiums, consequently they do not have room to own bulky or large quantities of equipment.  This is expected to be a benefit for the rental business. 

Strategy and Implementation Summary

Emphasize Customer Service

Hisarlik Hardware will build a reputation of fantastic customer service, building upon what Building Blocks stores and the Building Blocks brand have already established.  We will establish our business, by offering a clear cut leader in retail hardware in downtown Wilusa.

Build a Relationship-Oriented Business

Fantastic service will lead to long term loyal relationships with our customers and clients.  The goal is to have our customer base become reliant on Hisarlik to stock items and have solutions for their needs.  The customers will soon understand the value of the relationship.

Focus on Target Markets

Hisarlik will focus on the market segments identified earlier in this document.  Each of the market segments will have sales initiatives to focus on each group.

Differentiate and Fulfill the Promise

Hisarlik Hardware  can’t just market and sell products and services, we must actually deliver as well.  We need to make sure we have the knowledge-intensive business and service-intensive business we claim to have.  This service has to be consistent and deliver what the customer is looking for.

5.1 Marketing Strategy

The Building Blocks Power Events are advertising programs supported by national advertising during peak buying periods for planned home care products.  Power Events focus on those high traffic times of the year with a multimedia campaign.  A strong mix of national television and radio advertising, circulars, Sunday supplements, and POP sign kits deliver a sense of urgency to visit the store.  A small 8-page and large 12-page circular are available for each Power Event to help carry the theme and promote the sale.  There are four Power Events each year.

Hisarlik Hardware will also place ads in the Yellow Pages.  The Yellow Pages continue to be a source of a good number of customers.

Hisarlik Hardware will also rely on the media to help spread the word about this new business downtown.  Fox Television’s local morning TV show goes on location to promote local businesses.  Radio can be used in many different ways, radio remotes for the opening of the store.  Wilusa Magazine has already identified an issue, a follow up story is very appropriate.  The Wilusa Star covers new and significant businesses in Wilusa, Hisarlik feels this store will fit that description.

5.1.1 Potential Customers

Every person is a potential customer of a hardware store.  Hisarlik Hardware will carry items everyone needs.  The average household spends $135 per year on items found in a hardware store according to Yorikle, a research firm retained by Building Blocks .  The key to getting the potential customer to spend their $135 or more in Hisarlik Hardware are include the following attributes:

• convenience
• reliability
• knowledgeable
• progressive
• exceed customer expectations

All of these attributes will be present in Hisarlik Hardware.  In order to be convenient, Hisarlik will have to adapt to its environment, the location will be key to making it easy for customers to get to the store.  The store must also be open when the customers arrive.  In addition, a delivery service will be available to make it easier for regular customers to not have to leave what they are doing to get the products they need.  There will also be accounts set up to make it easier for regular customers to get items, without having to deal with petty cash, company credit cards, or company checks for each visit to the store. 

Customers expect to get great service at Building Blocks Hardware stores, which is evidenced by the fact 50% of all hardware shoppers will avoid the “Big Box” retailers and opt instead for the personal service like  Hisarlik Hardware .  We will also need to be reliable, which means that customers will depend on us to inventory what they need and understand and anticipate their needs.  Customers want to come into a hardware store having the confidence they will find what they need.  The store will possess a knowledgeable and friendly staff.  The staff has to understand and interpret what the customer needs and find the product that will fit that need.  Hisarlik Hardware will also be progressive, by that we mean we will continue to evolve and understand what the customer needs and develop new markets where the need exists.

5.2 Sales Strategy

Hisarlik Hardware  will be offering a convenient solution which all downtown residents need.  Customers will be introduced to Hisarlik through targeted advertising, direct mail, signage, and word of mouth.  Hisarlik will also take advantage of all the Building Blocks programs that help create loyalty and awareness among the potential customers in the market.

The direct sales force will consist of two seasoned sales people led by Hector Priamson.  The focus will be on property managers and all downtown businesses to create an awareness of the store location and the fact that the store is a potential solution for retail hardware needs.

Glaucus Sarpedon will also work on the commercial accounts and government accounts located in the downtown market.

5.2.1 Sales Forecast

The sales projections start in the month of March, 2004.  Sales steadily increase along with the awareness of the store through September.  In September, there is a small dip in sales then a steady rise through the Christmas season and December the stores best month of the year.  There is a traditional slow season that runs through January and February each year.  The goal of Hisarlik Hardware will be to develop programs that take as much slack out of the sales as possible and get them in line with the rest of the sales year. 

Sales are estimated by Building Blocks to be $125 to $175 per square foot of the total area of the store.  The Gross Margin will range from 40% to 45%.  There is a 25% growth predicted for the second year of sales driven by awareness, growth in rentals and growth in commercial sales. 

The immediate goal is to achieve robust sales in the first year.  It is thought that double digit percentage total sales increases can be achieved and maintained throughout the five years of this business plan.

5.2.2 Sales Programs

Building Blocks has loyalty programs like Building Blocks Rewards that Hisarlik Hardware  will participate in.  This program has been developed to build a loyal following of customers that use the card for shopping benefits. 

By the second year accounts will be set up for businesses, property managers, and contractors to make shopping easy for them.  This program will allow these customers to shop and make it easy for them to pay for items on account.  This program will have to be managed very carefully, and Hector Priamson’s financial background will prove to be very useful in managing these accounts. 

5.3 Strategic Alliances

Hisarlik Hardware has already contacted Scamander’s Food Market and have the word of the General Store Manager that they would be interested in developing programs to work together with Hisarlik for the betterment of both businesses.  Both will stand to benefit from each other.

5.4 Milestones

Hisarlik True Value has worked with True Value to establish a realistic time line to work within to have the store open for business in March of 2004.  The time line is listed in the Milestones table below.

5.5 Competitive Edge

The competitive edge has been covered throughout this document.  Location is the biggest key to this business.  There are no true competitors in our business in downtown Wilusa.  Our future customers have had to work harder to get the same or lesser service less conveniently.  We will be in their back yard and be easy to work with and have products they need. 

Hisarlik Hardware have staff that understand customer service and how to treat customers so that they want to shop in the Hisarlik Hardware environment.

Web Plan Summary

Obviously, we are in the age of computers and the Internet.  Customers are ultimately looking for the simplest, most reliable, and least consuming way to get the goods and services they need. 

Therefore, a Web strategy is important to keep up with the changing world and stay ahead of potential competition.  Customers that buy on the Internet do not care where a business is located, so it is important that a name and a reputation be established that customers can rely on whether it is in the store or on the Internet.

6.1 Website Marketing Strategy

Building Blocks has a sensational program for their members.  It allows a member to establish their own website with member information and use the established product background linked to buildingblockshardware.com.  Customers can then go on line and order products very easily.  This is a program that a normal small business could not afford to invest in. 

The Internet is also a valuable communication tool with customers.  The site includes a custom home page, store location along with a map, store hours, services and selection, in-store coupons, 1,000 item in-store catalog, and as many custom pages as a member needs.

Management Summary management summary will include information about who's on your team and why they're the right people for the job, as well as your future hiring plans.">

Hisarlik Hardware will be managed by Hector Priamson on a day-to-day basis.  He will devote 100% of his time to this venture.  There are two key employees joining Hector in this venture, Penthesilea Thracian and Glaucus Sarpedon. 

Hisarlik expects that there will be up to 17 employees in total, some full time and others part time.

7.1 Organizational Structure

Hisarlik Hardware will be managed, organized, and run by Hector Priamson.  The company will have three key employees, Hector, Penthesilea (Penthe) Thracian, and Glaucus (Glus) Sarpedon.  These three all know each other very well, Penthe and Glus having worked for Hector in the past in the oarsports industry.  They bring a unique set of skills to this venture which will prove invaluable in the future. 

The company will be organized with Hector Priamson as its president.  He will be responsible for all of the financial affairs, inventory management, cash management, manage the cashier staff, advertising, marketing, as well as the day-to-day contact with Building Blocks .  Hector will also have relationships with attorneys and accountants to stay on top of all business matters.  Additionally, he will also manage the day-to-day operation of the rental business.  While this seems like a lot, these are routine tasks Hector has performed for many different companies for many years.  As good as Hector is, he can’t do it all.  He will rely on two former employees from his. 

Penthesilea Thracian has been in the oarsports business for the better part of 30 years.  She is looking for a change and Hisarlik Hardware is just what she had in mind.  Penthe has managed teams, and developed and run programs from the ground up.  Her experience led her to winning the 1981 Salamis 500 as the crew chief of Al Cibiades’ trireme at Dardanelles Racing.  Working with large companies and manufacturers that wanted absolute accountability in their programs, Penthe was the gal that was brought in to handle it.  Over the past 5 years, she has added another unique skill that will nicely complement her mechanical skills; hospitality.  Penthe managed the hospitality program for Corinth Racing.  That job really entailed looking after people and providing great service, a skill that will be invaluable for Hisarlik Hardware . 

Glaucus Sarpedon is an extremely driven young man who graduated from Hattusili University.  Glus decided he wanted to work in oarsports.  When he put his mind to it, that is exactly where he ended up.  He joined Dardanelles Racing where he worked in the hospitality area, also gaining the valuable service quality that will be necessary for this new role.  He also had the responsibility of moving, setting up, and servicing the complete hospitality fleet.  He has mechanical skills that he will bring with him as well.  Glus also filled the role of Team Coordinator, this role is the “quarterback” of the organization.  He was responsible for anticipating what the team was going to need, when they would need it, and how much they would need.  Glus will be a huge asset to the company. 

Each of these folks have departments that will be assigned to them and a staff that will help them manage the departments.  They will be responsible for hiring the staff that will report directly to them.  Hisarlik Hardware will also develop an incentive plan rewarding successful departments and department sales growth.  The experience and trust Hector Priamson has in these two individuals will allow him to focus on managing the business.

7.2 Management Team Gaps

A review of potential gaps in the experience or know-how of this venture does not show any glaring weaknesses.  Hisarlik Hardware ‘s Achilles heel is the lack of actual hardware store business experience.  While the three key individuals do not have that direct experience, they will draw heavily upon the instruction, training, and specialist support available from the Building Blocks co-op organization. Building Blocks is in the business of passing on their experience and knowledge to assist their members to be be successful.

7.3 Personnel Plan

The personnel plan was developed in conjunction with Building Blocks and some consulting with the folks at Konya Building Blocks Hardware in Catalhoyuk. 

The plan was developed so there are at least 2 managers, 1 cashier, and 2 specialists on duty at all times.  The average number of people working at any one time is between 5.5 and 7.1 on busy Saturdays.  All employees will have the ability and knowledge to run the cash registers. 

Hector Priamson, Penthesilea Thracian and Glaucus Sarpedon will start with base pay as laid out in the following table.  The cashiers will be paid $7-$8 per hour.  Full-time specialist staff will be paid between $9 and $10 per hour.  Other part-time help will be paid $6 per hour. 

It is felt there is a pool of retired “handy men” that can fill many of these roles.  The $6 per hour employees are thought to be high school or college kids. 

Employee hiring will start in January, training will begin in February and work in March.

Financial Plan investor-ready personnel plan .">

The business will need substantial start-up capital.  It is expected that a good portion of that amount will be secured through SBA financing. 

Sales are expected to start conservatively the first year and increase steadily through the fifth year of operations.  Operating income will pay back the start-up loan over a seven year amortization. 

Inventory Turnover ratios are predicted to be in excess of 4.3.  The goal will be to get this ratio to exceed 5.0.  To do that Hisarlik will be required to purchase smartly and drive sales. 

Cash will be retained in the business to cover cash operating needs as well as future expansion of other Hisarlik Hardware locations. 

It is expected that dividends will be paid to the investors annually.  The amount of the dividends is estimated to be 50% of profits. 

After the first year of operations, it is expected that Hector Priamson will be able to trim expenses in the business as efficiency, experience, and knowledge work together and help the business operate better.  Estimates are extremely conservative in the budgeting process.

8.1 Start-up Funding

Hector Priamson will invest cash, benefits and labor to the start up.

Troy Enterprises  is in the process of negotiating with potential investors for the seed cash needed to start the business.  It is expected that a tidy sum will be raised to start the business.  It is expected that no more than 15% interest will be given to each investor.

Bank Financing

Troy Enterprises  is submitting business plans and other requested documents to financial institutions in pursuit of the additional money needed to finance the rest of the company and provide operating cash for the business.  It is expected that the loan will be a part of the SBA 7(a) program.  It is assumed that the terms of the loan will require repayment in 7 years, at a rate of 8%. 

8.2 Important Assumptions

The table below presents the assumptions used in the financial calculations of this business plan.

8.3 Key Financial Indicators

As shown in the Benchmarks chart below, our key financial indicators are:

• Projected Sales:   Projections are based on estimates calculated by Building Blocks based on demographics and potential in the market place.  Sales will consistently increase as the store gains experience, in addition to the consistent growth expected in the home improvement category nationwide. 
• Gross Margins:   Building Blocks expects that the Gross Margin can increase in years 2-5, however for this analysis, the gross margin was kept consistent at 42% on inventory sales.  Overall, the rental and other income have driven the gross margin up by 2 points.  Building Blocks expects that Gross Margin on inventory could rise as high as 44%. 
• Operating Expenses:  Operating expenses growth is primarily caused by an increase in salaries as the business gets established, as well as a small percentage increase for COL over the next five years.  Operating expenses are expected to increase at a rate of 6-8% per year. 
• Inventory Turnover:   Hisarlik Hardware  will maintain just-in-time inventory levels.  Building Blocks distribution will help maintain those levels.  Inventory is projected to turn 4.3 times per year.  The goal is to get inventory turns to exceed 5.0, through good purchasing decisions.

8.4 Break-even Analysis

The Break-even Analysis has determined approximate break-even sales as shown below.  There will be a constant monitor on this number in an attempt to lower it.  Once again, it is believed that efficiencies, experience, and knowledge will help in decreasing the break-even number. 

Sales are expected to be well in excess of this number for each month.

8.5 Projected Profit and Loss

The Profit and Loss statement makes it very clear which areas will need attention.  Payroll is by far the largest expense the company incurs (besides cost of goods sold).  Staff will need to be managed and hours regulated so that hours worked correlate to sales.  Emphasis will be placed on minimizing expenses that do not help generate bottom line. 

The company generates a profit as sales revenue gets above the break-even line.  A push on sales will be very important in generating bottom line profits.  Interest expense is also a large line item that diminishes over time, but is a necessary expense on the front end of the business.

8.6 Projected Cash Flow

The company generates a net positive cash flow in its first year.  It is assumed that Accounts Payable will be repaid in 45 days.  Repayment of debt is a significant factor in the amount of cash that gets paid out.  Long-term debt is on a 7-year amortization. 

Dividends are paid in December of each year.  The assumption is that 50% of profits are paid out to shareholders and investors.

8.7 Projected Balance Sheet

The balance sheet is very straight forward.  No significant purchases of assets are expected or anticipated. 

Using Building Blocks’ IAIS, online ordering, and weekly delivery systems allows Hisarlik Hardware  to restock inventory in a just-in-time fashion.  Inventory levels will be maintained with re-orders tied to Cost of Goods Sold.  Additional inventory purchases will be made one month prior to participation in the quarterly Building Blocks nationally advertised Power Event sales. The first Power Event coincides with Hisarlik Hardware’s  Grand Opening.  Inventory will be allowed to drop somewhat at the end of December, after the Holiday purchasing, and for year-end tax accounting purposes.

There is a possibility of rental purchases in the future if the right products are found to add to the current inventory.

8.8 Business Ratios

The Ratio Analysis looks very encouraging.  Industry Profile data is based on Standard Industrial Classification code 5252, Hardware Stores. 

• Gross margin : Increases each year and peaks at 45%.  It is anticipated that after year two, the gross margin percentage could be increased by as much as 2 points.  The Gross Margin is a little high due to the fact that the rental income is included in this calculation with no cost of sales.
• Selling, General and Administrative Expenses : It is encouraging that these expenses as a percentage of sales are decreasing.  These expense will continue to be looked at to find new savings to deliver bottom line.
• Quick Ratio : The Quick Ratio is good staying in the 2 range for the entire first 5 years.
• Net Profit margin : Net profit margin continues to grow.  The goal will be to minimize expenses and get the Net Profit margin in the 15 range.
• Inventory Turnover : Inventory turnover as calculated here is 2.3 to 3.5 times.  The goal will be to get that percentage to exceed 5 times per year.  The calculation is skewed on this table because of rental income being included in sales.

8.9 Long-term Plan

The long term plan is to develop a steady retail hardware business in the downtown Wilusa market.  As discussed, there is currently no competition.  They key will be to establish a solid business to discourage any competition from coming into the market or creating a level of loyalty that will not be fazed by competition. 

After two solid years of performance and establishment of Hisarlik Hardware , there are two areas of potential expansion.  First, look for opportunities in the current market.  What businesses can be combined logically with what has been established that will deliver additional bottom line profit.  Secondly, a second location will be developed in a new part of Wilusa.  An area that will deliver a similar characteristic to the first store that appears to be headed down the road of success.

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Related business ideas, discover your perfect domain, hardware store mini business plan, earnings expectations:, actions to hit those numbers:, not what you had in mind here are more ideas, grab your business website name, step 1: determine if starting a hardware store is right for you, breakdown of startup expenses, breakdown of ongoing expenses, examples of ways to make money, step 2: name the business, step 3: develop a business plan, outline of goals and objectives, market analysis, financial plan, step 4: secure financing, options for financing, tips on securing financing, step 5: choose a location, step 6: obtain necessary licenses and permits, applying for licenses and permits, cost of licenses and permits, renewing licenses and permits, step 7: set up shop, inventory and supplies needed, tips on setting up shop, step 8: market the business, step 9: monitor the business, explore more categories, take the next steps.

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The Key Elements of a Business Plan for Hardware Startups

As an advisor to new hardware entrepreneurs, I often hear the myth that a business plan is no longer required to find an investor, if your idea is good enough.

This article is written by Marty Zwilling who is an angel investor and startup business consultant. He is also one of the experts in the Hardware Academy .

You may have heard that venture capitalists in Silicon Valley no longer read business plans. What you don’t realize is these famous investors only deal with entrepreneurs who sold their last company for a $100M dollars or more.

For the rest of us, we need a business plan, as well as a product plan. Some of you may be convinced that your product specification communicates the product message even better than a business plan, so why be redundant?

Get your FREE Ultimate Guide - How to Develop and Prototype a New Electronic Hardware Product in 2024

Let me assure you that a business plan and product plan are two different things. You need both to survive.

To be clear, I define a product specification as the technical definition of your product, to be used for development and testing purposes, with a quick business summary for context.

A business plan is the outward facing definition of the business you hope to drive with your hardware solution, with a hardware overview in the intro to highlight customer value and competitiveness.

You may not be familiar with the key elements of a business plan, and the way to use it correctly to support and add credibility to your hardware solution. So I offer the following outline for how to organize and present your business plan, with specific examples:

Table of Contents

Start by outlining customer problem and your solution

Use non-fuzzy terms to quantify customer value. For example, “We just patented a new battery technology that will cut your smartphone charge time and cost in half.”

Be sure to include this in your “elevator pitch,” which you must always deliver as a prelude to your technology features.

Description of the business entity you plan to form

The most common business entity used for startups is a Limited Liability Corporation (LLC), which is the cheapest and simplest to manage.

If your goal is a large national corporation with more than 100 investors, and multiple classes of stock, you might prefer a C-Corp or S-Corp.

Quantify the market opportunity in business terms

The answer is not “if we build it, they will come.” Investors and advisors want to see recent survey data and projections from industry professionals here, not just your opinion.

For example, “Nielsen projects that the market for smart phones will double every year for the next five years.”

Highlight your advantages over three top competitors

Call out your top competitors, highlighting your sustainable competitive advantage, including patents, trade secrets, and trademarks. Don’t denigrate your competitors, but use their limits to highlight your edge.

For example, rather than saying, “Competitor X has poor reliability,” use a positive approach to list your reliability features compared to X. If possible, quantify these in non-technical business terms, such as dollars saved or replacement costs over time.

Provide specifics on the customer business model

All startups need revenue to thrive, such as from subscriptions, retail sales, online sales, licensing, or services.

Positioning your hardware solution at a low cost may sound attractive to customers, but it won’t attract investors. They want to see revenue to share in the return.

Document why your team is the best for this challenge

Don’t assume titles will convey this information. Professional investors and even customers invest in people, rather than just a product.

NOTE: If you are a member of the Hardware Academy you should highlight that in your business plan since it shows you are getting guidance from industry experts.

Include marketing, sales, and customer rollout plans

Don’t let your passion convince you that word-of-mouth and viral marketing will suffice against well-funded competitors and ever more demanding customers.

Set specific targets for the sales channels and marketing initiatives you need, including the use of social media, brand building, franchising, trade shows, affiliates, and distributors. Budget time and dollars for each.

Target income and expenses by year plus funding

Here I recommend a 5-year projection of revenue, expenses, and funding requirements. Major milestones along the way should be outlined.

Scale your funding requests to the value of your startup today, consisting of assets, contracts, and intellectual property you currently own. The best way to do this is to reference actual data from a recent similar startup success.

Investors look for high-growth-potential companies who can double revenues yearly, hit break-even in two or three years, and penetrate at least 10 percent of the opportunity you quantified for the first five years, to give them a 10X return on their investment.

Outline a viable exit strategy for you and investors

Investors want to know how and when they might see some return on their investment, since startups require some event to show value.

The options here include going public (IPO), merger/acquisition, liquidate, or no exit (just paying off investors). Most investors don’t want long-term commitments.

Summarize all of the above in an executive summary

Since everyone wants a quick overview of the whole plan, you need a tightly written and formatted two-page content summary, using the first paragraph of each of the above sections.

This summary is often extracted as marketing collateral, with text and graphics for pitch handouts.

Based on my experience in the investment world, aspiring entrepreneurs seeking an investment with no written business plan are routinely requested to come back later, when “you have more traction.”

Every good technologist should start with at least a single page business plan, or construct a “pitch deck” of maybe a dozen PowerPoint slides to cover all the important content.

Most of the business plans I see getting funded today are less than 30 pages in total, even including financial statement attachments.

Final Thoughts

What investors expect, and what you should be looking to provide for your own use, are answers to all the relevant questions a good advisor might ask about your business goals, objectives, structure, and milestones over time.

I personally find that writing down my business plan is a good discipline for thinking through all the issues, and doing the research on the alternatives available.

I know from experience that most investors look for written plans to separate what they call “hobbyists” from serious entrepreneurs.

If you have no idea what needs to be included in your business plan, fortunately there are many useful templates available online and books on how to write business plans are in every bookstore.

Several software applications are also available to at least partially automate this process. Part of the fun of starting a business is the learning process, and this is an easy place to start.

If all else fails, working on your business plan is a good time to ask for help from a peer entrepreneur, or follow up on a friendly relationship with someone who has been there and done that.

In fact, if you lack prior business experience this is your best opportunity to attract a co-founder who has the business skills and interests that are complementary to your strengths.

Keep in mind that multiple  studies  have found that entrepreneurs who create a good business plan at least double their chances of securing funding and growing a business to change the world.

Other content you may like:

• Lesson 2: The Strategic Way to Develop and Sell Your New Electronic Hardware Product
• Business Models and Recurring Revenue for Hardware Startups
• 5 Most Impactful Mistakes You May Not Survive
• The First Critical Steps When Bringing a New Hardware Product to Market
• Lesson 1: The Strategic Way to Develop and Sell Your New Electronic Hardware Product

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Hardware Store Business Plan and SWOT Analysis

Hardware Store Business Plan, Marketing Plan, How To Guide, and Funding Directory

The Hardware Store Business Plan and Business Development toolkit features 18 different documents that you can use for capital raising or general business planning purposes. Our product line also features comprehensive information regarding to how to start a Hardware Store business. All business planning packages come with easy-to-use instructions so that you can reduce the time needed to create a professional business plan and presentation.

Your Business Planning Package will be available for download after your purchase.

Product Specifications (please see images below):

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Despite the rise in big-box stores, local hardware stores remain popular especially in rural markets. These businesses are able to provide a number of items that are commonly used by people engaging in home repair, or among contractors that need specific parts for specific jobs. The gross margin is generated by a hardware store are considered a moderate and are typically around 50%. The startup costs associated with this type of business is usually around $100,000 to $200,000 depending on the size of the store and the amount of inventory that we carried at the onset of operations. These businesses often thrive when he develop ongoing relationships with area real estate developers and general contractors that need specialty parts on an ongoing basis. This is one of the ways that many smaller hardware stores are able compete with their big-box competitors.

Given the economic stability of these businesses, many banks are willing to provide a strong degree of capital support for the establishment or expansion of a hardware store. In this case, a hardware store business plan is going to be required. This business plan should feature a three-year profit and loss statement, cash flow analysis, balance sheet, breakeven analysis, and business ratios page. A full-scale competitive analysis should be included within the business plan in order to ensure that the small hardware store is not in a direct competition with a big box retailer. A large-scale demographic profile should be included as well that not only takes a look at people engaging in their own home improvements, but also among real estate developers and general contractors that will use the business on an ongoing basis. If the entrepreneur is seeking capital from the bank then he the substantial analysis of the collateral that will be acquired with the borrowed funds should be included as well.

A hardware store SWOT analysis should also be produced. As it relates to strengths, hardware stores are typically able to remain profitable and cash flow positive in any economic climate, while also having the ability to expand rapidly once they establish a client base, and the barriers to entry are considered a moderate.

For weaknesses, these businesses face constant pressure from large-scale big-box retailers that are able to provide their customers with an expansive selection of general and specialty merchandise. As such, the hardware store must find ways that allows them to differentiate themselves from other competitors in the market.

For opportunities, these businesses can readily expand by simply establishing new locations in markets that do not have a significant number of other hardware stores in operation. Additionally, these businesses can develop specialty service lines that allows them to provide a differentiating factor.

Outside of the ongoing competitive issues associated with a hardware store, there are no known threats that would impact the way that these companies conduct business.

As it relates to the hardware store marketing plan, a full-scale marketing and advertising campaign should be undertaken in order to familiarize area general contractors, roofers, real estate developers, electricians, plumbers, and other trades people with the products and services that are offered to the hardware store. This will ensure an ongoing and predictable stream of revenue from the Onset of operations. Additionally, a large-scale marketing campaign that targets individual homeowners should also be done. This will allow the business to effectively reach an audience of people who are in continual need of specialty hardware products. Additionally, many local hardware stores often focus on the fact that this is a locally owned business and supports an area business person. A substantial online presence should also be included that may or may not feature e-commerce functionality. By listing the entire inventory of the hardware store on this website, which should be mobile friendly, the hardware store can effectively reach a large number of people within a local or regional market. A web development firm can be hired to assist the entrepreneur in developing this type of online platform.

Hardware stores are going to be around forever about the technology that is associated with delivering these products to homeowners as well as contractors has changed significantly. By operating a highly specialized capacity, many entrepreneurs have found that they are able to thrive as a hardware store owner. This is especially true if the hardware store maintains employees that can assist the homeowner with completing a specific project. As such, these businesses can remain profitable despite changes in the economy as well as continued changes in the hardware product marketplace.

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Hardware Store

FICTIONAL BUSINESS PLAN

OSHKOSH HARDWARE, INC.

123 Main St. Oshkosh, WI 54901

The following fictional plan outlines how a small hardware store can survive competition from large discount chains by offering products and providing expert advice in the use of any product it sells. This plan is fictional and has not been used to gain funding from a bank or other lending institution.

EXECUTIVE SUMMARY

The business, goals implementation.

• JOB DESCRIPTION-GENERAL MANAGER

QUARTERLY FORECASTED BALANCE SHEETS

Quarterly forecasted statements of earnings and retained earnings, quarterly forecasted statements of changes in financial position, financial ratio analysis, details for quarterly statements of earnings.

Oshkosh Hardware, Inc. is a new corporation which is going to establish a retail hardware store in a strip mall in Oshkosh, Wisconsin. The store will sell hardware of all kinds, quality tools, paint and housewares. The business will make revenue and a profit by servicing its customers not only with needed hardware but also with expert advice in the use of any product it sells.

Oshkosh Hardware, Inc. will be operated by its sole shareholder, James Smith. The company will have a total of four employees. It will sell its products in the local market. Customers will buy our products because we will provide free advice on the use of all of our products and will also furnish a full refund warranty.

Oshkosh Hardware, Inc. will sell its products in the Oshkosh store staffed by three sales representatives. No additional employees will be needed to achieve its short and long range goals. The primary short range goal is to open the store by October 1, 1994. In order to achieve this goal a lease must be signed by July 1, 1994 and the complete inventory ordered by August 1, 1994.

James Smith will invest $30,000 in the business. In addition the company will have to borrow $ 150,000 during the first year to cover the investment in inventory, accounts receivable, and furniture and equipment. The company will be profitable after six months of operation and should be able to start repayment of the loan in the second year.

The business will sell hardware of all kinds, quality tools, paint, and housewares. We will purchase our products from three large wholesale buying groups.

In general our customers are homeowners who do their own repair and maintenance, hobbyists, and housewives. Our business is unique in that we will have a complete line of all hardware items and will be able to get special orders by overnight delivery. The business makes revenue and profits by servicing our customers not only with needed hardware but also with expert advice in the use of any product we sell. Our major costs for bringing our products to market are cost of merchandise of 36%, salaries of $45,000, and occupancy costs of $60,000.

Oshkosh Hardware, Inc.'s retail outlet will be located at 1524 Frontage Road, which is in a newly developed retail center of Oshkosh. Our location helps facilitate accessibility from all parts of town and reduces our delivery costs. The store will occupy 7500 square feet of space. The major equipment involved in our business is counters and shelving, a computer, a paint mixing machine, and a truck.

Oshkosh Hardware, Inc. will operate in the local market. There are 15,000 potential customers in this market area. We have three competitors who control approximately 98% of the market at present. We feel we can capture 25% of the market within the next four years. Our major reason for believing this is that our staff is technically competent to advise our customers in the correct use of all products we sell.

After a careful market analysis we have determined that approximately 60% of our customers are men and 40% are women. The percentage of customers that fall into the following age categories are:

The reasons our customers prefer our products is our complete knowledge of their use and our full refund warranty.

We get our information about what products our customers want by talking to existing customers. There seems to be an increasing demand for our product. The demand for our product is increasing in size based on the change in population characteristics.

At Oshkosh Hardware, Inc. we will employ three sales people and will not need any additional personnel to achieve our sales goals. These salespeople will need several years experience in home repair and power tool usage. We expect to attract 30% of our customers from newspaper ads, 5% of our customers from local directories, 5% of our customers from the yellow pages, 10% of our customers from family and friends and 50% of our customers from current customers. The most cost-effective source will be current customers. In general, our industry is growing.

We would evaluate the quality of our management staff as being excellent. Our manager is experienced and very motivated to achieve the various sales and quality assurance objectives we have set. We will use a management information system which produces key inventory, quality assurance and sales data on a weekly basis. All data is compared to previously established goals for that week and deviations are the primary focus of the management staff.

The short term goals of our business are:

• Open the store by October 1, 1994
• Reach our breakeven point in two months
• Have sales of $ 100,000 in the first six months

In order to achieve our first short term goal we must:

• Sign the lease by July 1, 1994
• Order a complete inventory by August 1, 1994

In order to achieve our second short term goal we must:

• Advertise extensively in September and October
• Keep expenses to a minimum

In order to achieve our third short term goal we must:

• Promote power tool sales for the Christmas season
• Keep good customer traffic in January and February

The long term goals for our business are:

• Obtain sales volume of $600,000 in three years
• Become the largest hardware dealer in the city
• Open a second store in Fond du Lac

The most important thing we must do in order to achieve the long term goals for our business is to develop a highly profitable business with excellent cash flow.

Oshkosh Hardware, Inc. Faces some potential threats or risks to our business. They are discount house competition. We believe we can avoid or compensate for this by providing quality products complimented by quality advice on the use of every product we sell. The financial projections we have prepared are located at the end of this document.

JOB DESCRIPTION: GENERAL MANAGER

The General Manager of the business of the corporation will be the president of the corporation. He will be responsible for the complete operation of the retail hardware store which is owned by the corporation. A detailed description of his duties and responsibilities is as follows:

Train and supervise the three sales people. Develop programs to motivate and compensate these employees. Coordinate advertising and sales promotion effects to achieve sales totals as outlined in budget. Oversee purchasing function and inventory control procedures to insure adequate merchandise at all times at a reasonable cost.

Prepare monthly and annual budgets. Secure adequate line of credit from local banks. Supervise office personnel to insure timely preparation of records, statements, all government reports, control of receivables and payables and monthly financial statements.

Administration

Perform duties as required in the areas of personnel, building leasing and maintenance, licenses and permits and public relations.

User Contributions:

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Hardware Business plan | The Profit Monster Of India

Hardware stores are standing in front of a great shift in terms of technology. The way modern technology has changed the work it has done the same for hardware business in India. If you agree with this perspective then you are in the right direction to start a hardware business in India .

Due to the digital revolution, opportunities have been created in the hardware industry. In this guide, we will show you how you can grab those opportunities and transform them into a big success.

Before moving to know about a great deal of hardware industry, you need to formulate a complete business plan that will help you to set up hardware business in India.

Let us know where you can start.

Define business structure .

Starting a hardware store will call for a basic understanding of legal forms of business . You are required to choose among these legal forms by weighing their pros and cons.

Sole Proprietorship

When a business is operated solely by a single owner then it is termed as a sole proprietorship. It is not recommended by a hardware store to operate as a sole proprietor.

A company is a different person than it’s owners. Company has shares which can be sold to get funding. This type of legal structure is recommended for a large scale business.

Franchising

Hardware stores mostly opt for franchising due to hardcore competition with big giants in the hardware industry. These giants can purchase inventory at a reasonable price whereas a small business can’t. Hence it is a recommended option.

Partnership

If you and some of your friends or relatives want to open a hardware store then the partnership is the best legal structure. It will help you out in various ways such as profit sharing and decision making.

Market Understanding 

Starting a business requires a detailed understanding of the market. You need to know where products are purchased and to whom these products are sold. What is the costing and what are profit margins? Use below strategies.

Analysis of Industry

You can take help of the online researches and then interpret the data according to your area of operation. Alternatively, you can approach various hardware stores to collect personal data and use it wisely.

Industry Trends

Hardware store is going through various trends. To understand these trends you will be required to know your customers. By stepping into the shoes of your customers, you can understand the market demand and market trends.

Competitors Research

Know your competitors well. You need to understand the hardware stores present in your city. If any of those stores are able to provide raw material at a cheaper rate then how? Try to talk to different suppliers.

Products Offering 

After understanding the market well, it is time that you identify the products which are used more by customers. 

Use these factors to identify products to be offered

You can talk to various suppliers of raw material and then get different prices for every product. In this way you can understand which products are relatively low in cost and high in demand. Use that for your business.

Profit margins

Keep those products that provide a high-profit margin. You have already researched the market and now is the time to use that data. You need to analyse which products are offered much higher than it’s cost.

Availability

You may have identified the products that you are going to sell but are they available for the whole year. It may be possible that they are not supplied for a period of time then consider that period too.

Customer demand

You should be able to predict customer demand. You can do that by using previous year market trends. Either use the online data or research yourself. 

While choosing a location there are various factors that are must to keep in mind. One mistake can drag the traffic to a different store.

• Customer Attraction Your place should be able to attract enough customers.
• Visibility Location should not be in the corner area.
• Convenience It should be easily possible to reach at your location.
• Parking proper space for parking should be provided.
• Space Enough space should be available for raw material and working area.
• Competitors Stable competition should be available.
• Cost of the place Affordable costing in accordance to your profits.
• Accessibility to Customers Proper facility of roads to reach at your place.

Equipment Required 

In a hardware store, your raw material which will be sold is termed as equipment. The major raw material that will be required in a hardware store is listed below:

• Payment machine
• Nuts and bolts

Legal Permits 

Get your business registered officially through these licenses.

GST registration Every business is required to pay taxes on the selling of goods and services.

Business license Business is required to be registered according to your legal structure.

Business insurance You must get your business insures to avoid future problems.

EPF Registration If you register more than 20 employees, then getting employee provident fund registration is mandatory.

Starting a hardware business will require initially to market your business. It will help you attract first customers.

Refer to Friends

Reach out to your friends and ask them to refer your service to other people. This is the most popular ways of getting customer in a hardware store.

Attend social events and seminars so that you can build more contacts. People will contact you if they know about your quality of services.

Digital Presence

You can have a business account in Google and WhatsApp to get orders online. This creates convenience for your customers.

Growth Opportunities 

Once your business is settled and you want it grow in respect of sales. Then use these strategies.

Expand Products

Start providing more products variety. More variety of products will lead to targeting new customers. You can attract different markets too.

Approach To Suppliers

Take help of your suppliers and know-how they do the processing of raw material. You can work with them. They can refer your services to the people your suppliers know.

Take Social Initiatives

If you are taking social initiatives then it contributes to your society. You can use eco-friendly systems and green initiative to build an image in the society.

After 2018 hardware business has been rising. You can use this opportunity to set up your business. You need to be updated with the market trends.

Here is a TIP# Get experience as much as you can. It will help you out in a more productive way.

Be consistent with your hard work and take the first step by using the above strategy.

Have any queries? Don’t wait, Comment Below.

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How to Write a Hardware Business Plan in Kenya [Free Template]

A good hardware business plan in Kenya will help you make your business a reality much faster. 

You can absolutely get started and run your business without a plan. 

However, if you are looking to start a hardware business that stands out from the competition, you might need a business plan. 

Let me write your business plan...

Not sure where to start your business and need a detailed roadmap? Looking to take your business to the next level? Do you need a well-crafted business plan that can guide your growth and set you on the path to success?

We charge from:

Tap the button below to chat on WhatsApp or call 0713140158.

The problem is, writing a hardware business plan from scratch is not easy. It is even harder if you are starting your first business and have no finance or business experience. 

That is why a hardware business plan template like this one comes in handy. This template will act as a roadmap to help you easily come up with a business plan for your hardware business.

What is a Hardware Business Plan in Kenya? 

A second-hand clothing business plan in Kenya is a written document that clearly describes what you are trying to achieve with your hardware business and how you plan to achieve those goals or objectives. 

This business plan is like a roadmap that will help you take your hardware business from the ground to a level where it can comfortably generate profit. The hardware business plan outlines your goals, strategies, goals, marketing, and financial forecasts.

So, whether you are starting a small hardware business or plan on going large scale, this document will come in handy. 

Let’s find out. 

Why Do I Need  A Hardware Business Plan in Kenya? 

There are several reasons why you might need a business plan for second-hand clothes before getting started. In a nutshell, a business plan will help you to: 

• Clearly understand what you want to achieve with your hardware business 
• Set clear goals and identify obstacles that might stand in the way of achieving these goals early on
• Come up with a clear strategy to attract customers and achieve profitably 
• Track and measure your business progress 
• Secure external funding 
• Keep your team focused on the same objective and business goal 
• Understand how much money you need to start the business 
• Calculate the profitability of the hardware business 
• Study your competition and come up with strategies to outsmart them 
• Come up with effective marketing strategies to put your hardware business in front of the customers.
• Minimize the chance of running into risks and losing your money 

Why is This Hardware Business Plan Template Important?

As we mentioned, writing a hardware business plan from scratch is not easy. There are a lot of things to consider and you always run the risk of going into details that don’t matter. 

This template will help you to: 

• Write your business plan much faster 
• Avoid unnecessary details that don’t matter in your hardware business 
• Get a clear picture of what you should include in your plan 

So, think of this template as a roadmap to help you devise an effective plan for your hardware business. 

Types of Hardware Business Plans in Kenya

There are two main types of hardware business plans that you can use: 

• Traditional business plan
• Lean business plan

Traditional Hardware Business Plan in Kenya

This is the most common business plan format. It is usually very detailed and can be dozens of pages long.

Use this format if you are starting your hardware business on a large scale and/or require outside funding. 

A typical traditional business plan contains the following sections: 

• Executive summary
• Company description
• Product or service description 
• Market analysis
• Organization and management team 
• Marketing and sales
• Financial projections

You don’t have to cover all these sections when writing your hardware business plan. 

Just focus on the sections that make the most sense for your business and what you are trying to achieve. 

For instance, are you looking for funding or do you just need a detailed roadmap to help you get started and grow fast? 

Check Our Full Hardware Business Plan Template:

DOWNLOAD PDF TEMPLATE

Lean Hardware Business Plan in Kenya

This is a much-simplified version of the conventional business plan. It is actually just a one-page table summary of the most important elements of your business plan. 

You can write a lean hardware business plan in about an hour or less. Use this format if you are looking for an action plan or outline to help you start your business. This plan is usually just for you and your team, not outsiders (like investors)

You can’t use a lean business plan if you are looking to take a loan or an outside investment. 

A lean hardware business plan contains the following key sections: 

• Identity: A short description of your business
• Problem: The problem you are trying to solve 
• Solution: The unique solution you offer for the problem plus a description of your products/services 
• Competition : Other people trying to solve the same problem, their weaknesses and strengths 
• Expenses: The cost of starting your hardware business 
• Target markets: Who your customers are
• Marketing activities: The strategies you will use to reach your customers and the cost of your products/services
• Sales channels: How you’ll sell your services and products to your customers
• Revenue streams: The different ways your hardware business will make money
• Partners and key resources: The people and resources you will need to work with for your business to be successful
• Team: The people that will help you run the business and their roles
• Milestones : How you will test and begin your business

You can either use the lean or traditional business plan based on the size of your hardware business and the reason for writing the business plan. 

Check Our Lean Hardware Business Plan Template:

DOWNLOAD LEAN TEMPLATE

When Not to Use this Hardware Business Plan Template 

Using a template is a great way to complete your business plan fast. However, there are situations when using a template may not be ideal. 

This is especially true if you are starting a big business or startup that requires detailed reporting. While we try to include as many sections as possible, this template comes with limited instructions that may not comprehensively cover big businesses that require outside funding. 

Otherwise, if you are okay with a template, you can go ahead and download either the lean or traditional business plan template.

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L.K. Nathans

I am a personal finance enthusiast and digital marketer. My work here is to help you navigate your financial journey and achieve your main money goals. Through Omoka Digital, I provide practical tips, strategies, and insights on budgeting, saving, investing, and debt management. My aim is to empower you with the knowledge and tools you need to make informed financial decisions and improve your financial well-being.

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Microsoft and OpenAI plan to build a $100 billion supercomputer to power artificial intelligence: report

• Microsoft and OpenAI are working on a $100 billion supercomputer, according to The Information.
• The project could launch as soon as 2028 as part of the companies' five-phase plan.
• The US-based supercomputer, known as Stargate, would far exceed current computing power.

Microsoft and OpenAI are planning an unprecedented supercomputer that uses millions of specialized server chips and could cost up to $100 billion, The Information reported this week.

The US-based supercomputer, known as "Stargate," would be the centerpiece of a five-phase plan focused on a series of supercomputer installations the companies plan to build in the next six years, the outlet reported. Stargate, which would be phase 5 of the plan, could launch as soon as 2028, people involved in the proposal told The Information.

Executives at both companies have already drawn up plans for the data center project, which would power OpenAI's artificial intelligence, according to the outlet.

A spokesperson for Microsoft declined to comment directly on the report but highlighted the company's demonstrated ability to build pioneering AI infrastructure. 

"We are always planning for the next generation of infrastructure innovations needed to continue pushing the frontier of AI capability," a representative for the company told Business Insider. 

OpenAI did not immediately respond to a request for comment from BI.

Related stories

Microsoft, which has already committed more than $13 billion to OpenAI, would likely provide funding for Stargate, per the report. OpenAI currently uses Microsoft data centers to power its generative AI system ChatGPT in exchange for Microsoft having exclusive rights to resell OpenAI's technology to its own customers.

Microsoft insiders told Business Insider earlier this month that the company's strategy has increasingly focused on its work with OpenAI , leading some to worry that Microsoft is essentially becoming an IT department for the startup. 

The supercomputer could be 100 times more expensive than the largest data centers currently in operation, per the report. The project signals the massive amount of money likely to be poured into the industry as artificial intelligence continues to evolve in the coming years.

Stargate also has the potential to far exceed the computing power currently supplied by Microsoft to OpenAI from its data centers around the country but would require at least several gigawatts of power to do so, The Information reported,

Microsoft's involvement in the project, however, hinges on OpenAI fulfilling its promise to boost its AI's capabilities , a source told the outlet.

The quest to obtain the necessary server chips is the primary factor driving Stargate's hefty price tag, according to the report. Finding enough energy sources to power the project could also pose challenges, and the two companies have talked about possibly using alternative power sources like nuclear energy , sources said.

The demand for AI chips has reached a fever pitch, allowing a select few companies — primarily Nvidia — to control the market. Altman has expressed frustration with the "brutal" situation and signaled earlier this year that he wants to make his own. 

The chip dilemna is just one of several details that still need to be ironed out with regard to Stargate. People familiar with the project told The Information that Microsoft needs to figure out how to put more GPUs into a single rack than it currently does in order to boost the chips' performance. The company also needs to find a way to prevent the chips from overheating, according to the report.

It's not clear where Stargate would be located or whether it would be built in just one data center or several nearby centers, The Information reported.

Axel Springer, Business Insider's parent company, has a global deal to allow OpenAI to train its models on its media brands' reporting.

Watch: An AI expert discusses the hardware and infrastructure needed to properly run and train AI models

• Main content