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Easy to Plunge, Hard to Float

Starting a retail business is not difficult. But what is difficult is sustaining it and lending it growth and expansion. How many retail stores do we come across every day that are still in the same dimensions since its inception? Entrepreneurial drive to achieve business growth and expansion is one side of the story. The other side is how a business is set up. This other side comprises the fundamentals necessary to start a business on the right foundation. The right foundation of thinking, strategies, planning, and systems gives businesses a head start in their life cycles. In the absence of this foundation, it takes years for businesses to realise what went wrong. Making transitions later becomes a mountainous or even irreversible task.

In this blog, we will dive into seven important considerations as a part of retail startup business planning or the points to be considered in setting up a retail store.

#1 Business Model (Development &) Evaluation

A business model is an effort to broadly determine how the business will exist and sustain itself. And in this effort, nine vital aspects are explored and defined. These are also the parameters against which a business model is evaluated.

  1. Value Propositions – what unique value the business has to offer to customers
  2. Value Chain and Key Activities – How the identified value will be created and delivered
  3. Key Partners – Role of External entities in the value chain
  4. Capabilities – Internal and External Resource Requirements
  5. Costing – Capital Investments and Operating Expenditures
  6. Revenue Streams – Different sources of earning revenue
  7. Customer Segments
  8. CRM
  9. Channels of distribution

The above points of business modelling apply to retail startups as well; the size and scale of the intended business do not matter. As an example, a retail store can think of setting up an F&B kiosk within the store compound as a value-added service and create an additional source of revenue.

A vital output of business modelling is the identification of one or more niche specialities. This niche could be catering to a unique segment of customers, offering unique products and value-added services, superfast delivery (like dark stores), or anything else that provides a unique brand positioning.

#2 SOP-based Operations Planning

Operations planning is a necessity for ensuring high-quality execution of business processes. Done right, operations planning helps keep processes on track and aligned with business and functional objectives. Operations planning qualifies as an important constituent of a business plan. This applies to retail startups and stores as well.

Various business processes and operations of a retail store include inventory procurement, inventory management, marketing and sales, finance and administration, staffing, etc. Planning for these processes requires a professional touch. And many retail stores fail to succeed with their operations planning because of not using Standard Operating Procedures (SOPs) or poor application of SOP standards and practices.

SOPs also facilitate process automation and digitisation.

#3 Store Layout & Infra Setup

Let us first talk about retail store layout planning. Layout planning has many important ramifications for business. It helps retailers make the best out of the available space. A lot of guiding elements for this comes from the business model and SOPs. For example, if an F&B kiosk has to be incorporated, the right amount of space and the right location has to be determined in layout planning. Or where the quality check gates or counters should be placed is affected by the SOPs for inventory receiving, inventory storage, and stacking the shelves.

Infrastructural setup cannot be separated from store layout planning. The same example of an F&B kiosk is applicable here too.

#4 Staff Recruitment, On-boarding & Training

The importance of how employees present themselves, treat customers, exhibit their expertise, and extend support in retail stores does not need an extended elaboration. So, what are retail entrepreneurs doing about it? The answer is they should be planning their staffing solutions keeping in mind their business prerogatives. These prerogatives are derived from the requirements of business models and required operational skills and abilities as drawn from SOPs. For example, if a new local retail store wants to stand out with superior customer service, then the elements of customer service need to find a place in the hiring and training grounds. Or if a store deals in makeup products, employees in those counters must possess the required knowledge and expertise to handle customer queries.

The significance is the same for employee onboarding and providing employees with the necessary training as per the job descriptions and SOPs.

#5 Marketing Plan – Launch & On-Going

Retail store startups or even existing retail stores at the time of opening branches need a proper launch program. A marketing launch program for new retail stores includes teaser campaigns on offline and online channels, billboard advertisements, distribution of promotional pamphlets via newspapers, launch day or launch week discounts, and other innovative steps to attract customers and form a good early impression.

At the same time, marketing is also an ongoing activity for all organisations including retail businesses. When we say ongoing marketing (adjustments and efforts), it involves a perpetual assessment of customer shopping journeys, consumer behaviour, competition, technology, demand, and every such factor that affects the present and future performance of a business in big or small ways.

#6 On-Going Audits and Training

Retail audit planning becomes a necessary aspect when a business is of a certain considerable size and stature. In micro retail stores, the people, processes, policies and systems are fewer. This does not negate the need for auditing but it is within the manageable range of a small team comprising owners, their family members, or a couple of employees with routine skills. But any retail store bigger in size and stature than that calls for detailed audit plans. A simple instance to realise this point is to think of a small deviation becoming a massive one over time and large business volumes.

Planning about how to conduct ongoing audits and provide necessary training help retail businesses track the level of compliance with policies and processes in a smooth, systematic, and non-disturbing manner.

#7 Financial & Commercial Planning

A mastery of financial and commercial numbers is critical for businesses. And this applies to retail store startups as well. This makes financial and commercial assessments a key element of any retail startup business plan. These projections prevent overspending and keep financial and commercial decision-making within the realm of plans and budgets.

Important areas of analysis in financial and commercial planning are:

  • Sales and revenue forecasting
  • Purchase planning and inventory scheduling
  • CAPEX & OPEX detailing, procurement of funds/investments
  • Preparation of estimated P/L Statements
  • Analysis of break-even period, ROI and ROC
  • Budget layout and allocation

Retailing will continue to remain an attractive business avenue given the presence and surge of favourable conditions like growth in urbanisation, rise in population, improvement of income levels, institutional promotions, and infrastructural developments. It is not that these factors were not present earlier. They were present before and they will exist in the foreseeable future. That is why retailing was, is, and will continue to get more dynamic and competitive. But what has not changed much are the underlying essentials of business planning: seven of which were touched upon in this blog.

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How to start a retail business? How do I set up a successful retail store? How do I plan to open a store? What is needed for a retail store?

If you are thinking of starting a retail store, take a pause and check if you have considered the following elements as a part of your business planning.

  •         Market Research
  •         Business Model Development
  •         Assets requirements
  •         Store Layout Planning infrastructure setup
  •         HR and staffing solutions
  •         Marketing and promotions
  •         Operations Planning
  •         Audit Planning
  •        Financial & Commercial Planning (listed in the end but indispensable)
How much investment is needed to start a retail store? How profitable is a retail shop?

The amount of investment required in a retail store depends on many factors. For example, if you are thinking of starting a consumer electronics and appliances store, the investments into inventory will be significant. If you are intending to start a hypermarket, the required investments will be massive. Therefore, to ascertain the investment requirements or to know about anticipated profit and loss, a business plan with financial and commercial assessments needs to be developed.

In brief, some of the important areas of analysis in financial and commercial planning are:

  •         Sales and revenue forecasting
  •         Purchase planning and inventory scheduling
  •         CAPEX & OPEX detailing, procurement of funds/investments
  •         Preparation of estimated P/L Statements
  •         Analysis of break-even period, ROI and ROC
  •        Budget layout and allocation

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Author Bio

 Nikhil Agarwal

Nikhil Agarwal

Chief Growth Officer

Nikhil is a calm and composed individual who has a master’s degree in international business and finance from the United Kingdom. Nikhil Agarwal has worked with 300+ retail e-commerce brands and companies from various sectors, since 2012, to define their growth strategy and achieve operational excellence. Nikhil & his team have remarkable success stories of helping brands achieve 10X growth.

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    The idea of having Ecommerce Consultants on-board from the beginning itself points towards reducing the involvement of the promoters in daily operations. Ecommerce Businesses willing to be a brand reaping profits & sustaining the competition must ensure that most of their processes should be automated. The more the manual intervention, the more would be the errors.

    In Ecommerce business, you get only 1 chance to impress the customer & if you mess up there, you lose the customer for long.

    Process automation in respect to all the activities pertaining to customers from order receiving to order fulfilment is a must for a seamless experience for the customers.

    Task Management is another grey area where most deadlines fail as 90% of the tasks are assigned manually & are forgotten, unheard, misunderstood or mistaken.

    YRC Team of Ecommerce Management Consultants helps to make maximum of the processes system-driven to ensure minimalistic manual intervention.


    No matter how good your product is, the customer would know only if it looks good.

    Photography includes the following steps:

    • Cataloguing your products
    • Cataloguing your images
    • Backup your images (A few cloud storage solutions include Dropbox, Google Drive, Bitcasa, Apple’s Cloud Storage etc.)
    • Choose the right camera & lens (You may also outsource the photography to a third party agency)


    Digital Marketing includes SEO & SMM. SEO i.e. Search Engine Optimization includes activities like back-linking, meta tags, blog-writing etc. to ensure your website ranks on the 1st page on Google Search.

    Next comes SMM i.e. “Social Media Marketing” which as the name suggests including promoting your products on all the social media sites, email marketing, influencer marketing & several other BTL activities.

    These activities are going to be recurring & would decide the traffic on the website, the conversions, whether the right target market is tapped, the likes, the views, the orders, the reviews & much more. YRCs Ecommerce Consultants create a budget for digital marketing right from pre-launch to launch & for each month thereafter.

    Building digital marketing strategies in coordination with the agency, selecting them to signing them off would be the role of YRC.

    This ensures seamless coordination, detailed interactions & desired execution as it is always advisable to work with a single agency than multiple of them.


    Selection of the right software for smooth functioning of back-end operations right from production to webstore display would be suggested and integrated by YRC Team.

    YRC’s Team defines SOPs of Product Movement, maps it with the locations & people. They then create a blueprint of all the features required in the software & help in shortlisting & selection.

    IT Integration involves connecting your offline inventories with real-time online webstore so when a sale occurs, inventories get deducted real time across offline as well as online platforms.

    This helps in accurate inventory management, maintaining the MOQs, re-order levels & achieving the optimum inventory levels.

    Some popular software include unicommerce, viniculum for your front-end website management & Genisys for your entire back-end Purchase, Production, Accounting, Invoicing etc. management.


    • How many cities or countries you wish to sell in?
    • Where should your Warehouse be located?
    • Should you have one warehouse in each country or city?
    • Should you be having your own delivery team in your base city?
    • Would the 3rd party vendors be reliable? What happens when they lose or misplace your product during delivery?
    • How should I manage the logistics if my goods are coming from different countries?
    • How should the goods be stored and barcoded?
    • How much space do I require for warehouse?
    • I am sure several such questions must be haunting you while you think of starting your own fashion ecommerce brand.


    At YRC, our warehousing and logistics experts can help you devise a strategy for all of the above mentioned queries and much more.

    We design the layout of the Warehouse considering the inward, goods processing, software entry, barcoding, outward, goods return, scrap storage, goods stacking & much more.

    Logistics route plan is devised considering the manufacturer to your warehouse and from there to last mile delivery locations.


    This Step involves 03 distinct parts:

    Part 1: Choosing the right Platform:

    From several platforms available in the market right from Shopify to magento, woocommerce, prestoshop, wordpress etc. you must choose the one that fits best for your business

    Part 2: UX Designing:

    “UX” denotes User Experience, which if put in simple language is building the functional requirements of the website.

    UX Designing includes designing the features required in the website, customer journey map, website features, the browsing features, navigation features, ecommerce order management process flow, checkout cart features, catalogue management, ecommerce payment system, cross selling features & much more.

    “As per statistics, 68% of the customers abandon the carts before payment”

    An interesting UX ensures the customer sticks on to the website for a longer time.

    Part 3: UI Designing:

    UI stands for User Interface, which means designing the look and feel of the website. UI includes using the right colours, elements and the entire aesthetics of the website.

    A good User Interface ensures the user completes the task that he has come for. It navigates the user through the journey of the brand in the simplest but most effective way.

    The UX designer maps out the bare bones of the user journey; the UI designer then fills it in with visual and interactive elements.

    If User experience is the bare bone, user interface wraps it up with an attractive cape.

    At YRC, our team if experts can help you develop the entire User Journey to ensure it is engaging!


    This step follows the “Designing” Phase, whether you have an in-house design team, freelance designers or an outsourced design company. It is one of the most exciting phases, as here you see your designs turning into products & your ideas turning into reality.

    In most start-up cases, production is outsourced i.e. brands tie-up with the established manufacturers/ job-workers to get their products manufactured.

    Sampling involves multiple 04 Stages, Fit-Sample, Prototype Sample, Pre-Production Sample & the Production Sample.

    Prototype Sample is the first sample provided to the buyer. It can be in any fabric/ colour. This sample is just to understand whether the product design looks equally great in reality.

    Fit Sample, as the name suggests is prepared to check the fit of the garment i.e. the various sizes, length, width etc.

    Pre-production is made by the actual production line. Here the stitching quality and other aspects related to manufacturing are checked. This is the last stage where rejection can be accepted.

    Production Sample is made before the production which is the replica of what is going to be finally produced.

    Once you are through with all this, you are good to go ahead & get your goods manufactured.


    Product Designing or Sourcing is the heart of the Ecommerce Fashion Brand.

    Product Designing / Sourcing can be done in several ways, as follows:

    • In-house Design Team
    • Freelance Designers
    • Outsourced Design Team
    • Ready Product Sourcing (From Manufacturer or Wholesaler)

    At YRC, we evaluate your business strategy & business model to arrive at the decision, which of the above ways would be best-fit for your business. In certain cases, product sourcing may be a combination of the above.

    These are the people who are going to build your brand! Whether they are the designers or merchandiser, your brand look is going to be in their hands.

    If you are designing each garment from the scratch, the sourcing would play crucial role in developing design identity of your brand.

    Sourcing includes fabric, trims, lining & all the raw material required to build the garment.


    Branding is the “Look of the Brand”, right from logo to tagline, the colours used, the brand story, the brand communications on social media, the packaging & all the other aspects which speak directly or indirectly to the customers. Branding constitutes the look & feel of the brand & hence must be thoughtfully planned to match with the product that we are selling.

    Branding must appeal to our target audience. Example : A golden colour logo depicting finesse, art, richness, premium, however beautiful it may be individually cannot go with a brand selling affordable kids wear products. So, your logo must be in-line with your brand positioning, whether you are an expensive brand or a luxury brand or a value for money brand, it must be depicted from your “Branding”.

    It is an integral part to attract the target audience.


    Organogram is the “HR Blueprint” of the business which is created at the onset, to map out the team required across each function at various stages of the business. At the launch, only key people need to be got on board to ensure the project gets started & at this stage, all of them need to multi-task. Similarly, certain financial as well as operational goals are set for addition of the further team. Example, for the operations team, we hire 1 operations manager during the pre-launch phase & we add 1 more only when the business kicks-off & we reach a volume of selling more than 1000 pcs/ month or a turnover of more than 0.1 million USD.

    SOPs are Standard Operating Procedures, a bible to run the entire organization right from Sales, Purchase, HR, Order receiving to Order fulfilment, Inventory Management, Accounts, Warehouse, Logistics, Supply Chain, Production & all the other relevant functions for the business. Business must be organized from its first day of operations; only then the tasks can be delegated.

    At YRC, we design the organization structure, the processes, and approximate time taken to execute each process, job profile of every member within the organization, their KRAs, KPIs & the Reporting Structure.


    Critical Pathway Analysis (CPA), is a project management technique which cannot be overlooked while launching an ecommerce fashion brand. Brand launch process is cumbersome with multiple inter-dependent & time-bound tasks involved, which need to be tracked to ensure the project remains on track.

    CPA outlines key tasks across the project, their turnaround time (TAT) & the dependencies of tasks upon each other. It identifies the sequence of tasks, their interdependent steps from inception to completion, their criticalities, and their dates of onset, target dates of completion along with the key responsible person for the respective activities. Critical Pathway helps in understanding the unimportant & not urgent tasks which may jeopardize the execution of the project because of an unexpected snag! It also maps out the potential bottlenecks which might be posed because of the dependencies of tasks upon each other & cases where the next task cannot be commenced before the completion of the previous one.

    CPA detects the minimum & the maximum time involvement of a particular individual or team to execute the task, thereby arriving at the overall deadlines associated with the project.

    At Your Retail Coach, we design the Critical Pathway & review it periodically to ensure the project is on track & the progress is measurable.


    Business Strategy includes the vision, mission, goals, business model, business plan & strategy for all the functions within the organization.

    Business Strategy is a well-defined plan that outlines who, what, where, why, how & when for the company; for example, who would be the target market, how to attract the target audience, when to launch new products, where to operate from, how to handle competitors, what would be the USP, what would be long term goal of the organization & several other answers to the 5Ws of Strategy.

    Business Strategy aligns the organization towards a common goal. Business SWOT helps company to identify & overcome their weaknesses & focus to sharpen the strengths. Business strategy forecasts future risks and helps business in building skillsets to overcome the potential threats.

    YRC’s Business Plan focuses on creating a “Blueprint” of the business, thereby deriving the feasibility of the concept & gauge whether the opportunity is lucrative to invest time, energy & effort. Business Plan creates cash flow understanding i.e. building inflow & outflow cash projections from Week zero to week 60 i.e. 05 year projection. Business Plan calculates the capital investment, operating costs, one-time costs, recurring costs & all the other numbers relevant to obtain the breakeven sales, return on investment, return on capital, internal rate of return & several other ratios. Business Plan is also one of the important requirements if you are targeting the “Investor Route”. Fund raising becomes extremely transparent & channelized. With business plan panned out clearly, the business will know until what point must it be stretched & where to stop, which reduces the probability of unplanned investments.


    Starting the concept of Ecommerce Fashion brand with Market Research ensures we get detailed understanding of the industry & this research report also acts as a social confirmation for your concept. Market Research helps in understanding the target locations, their population, potential online buyers for your product, competitors for each category, and top selling products of the competitors, competitors’ price range, offers & their responses & much more. Market Research helps in thorough understanding of your brand position as compared to our competitors. It helps in identifying gaps in the market, in your category along with the scope of the said product in the desired market. This will help in validation of your concept & prevents you from making the same mistakes as your fellow brands, eventually saving your time, energy & efforts. This phase is also a make or a break phase, as the market research study may at-times come up with some eye-popping numbers & statistics which might compel you to re-think on your product or category that you are planning to sell or alter your entire concept itself!! Market Research Reports analyse the competitors’ webstore for their traffic, conversion & sales. This is extremely valuable information to derive our inventory budgets & projections, which takes us to our next phase.