Question

Topic: Other

Determining Amount Of Capital Needed To Start Bizz

Posted by Anonymous on 3/25/2008 at 6:45 PM ET 25 Points
Hi everyone,

I know this site is more in line with marketing however I have been thinking for a long time about starting a pet boutique business. I know what your thinking, another one!!!...but I do have an advantage in the fact that my sister is a veterinarian and wants to open her own clinic, and I would like to possibly set up shop in conjuction with her. I think this would be a great idea. If not that, then I also have an idea of opening a pet boutique in a different country with less competition. But, I dont even know where to begin. Setting the business plan aside, how do i even go about finding out how much capital I would have to invest? Do i randomly contact wholesalers and inquire about their prices? Are thy willing to give me their time of day without me even having a business license? Would they tell me the wholesale prices? I mean, how can I determine how much money I can possible make from selling these products. I know that it depends on the quality etc...but lets just say on average. How do people who want to open a business start out...what is their first step? I mean they must get an idea of how much money they will need and how much things will cost them to set up shop before the business plan no?

I would appreciate all your help!!! thankS!!!
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RESPONSES

  • Posted on 3/25/2008 at 8:23 PM Accepted
    Every start-up is different. Each person has different assets going into a venture. There is a lot of things to cover in this area for this type of forum. I'm going to shamelessly recommend you read my book on the subject.
    https://www.nmoa.org/directmarketingtoolkit/
  • Posted by Peter (henna gaijin) on 3/26/2008 at 12:11 AM Accepted
    Don't set aside the business plan - instead work on it. This will tell you more about the information that you need, and guide you towards determining startup capital requirements.

    If you can't get wholesale price information from wholesalers (but you should just call and ask), for basic info you can probably expect that you will get something like 40-50% off of retail, which should be close enough for business plan purposes.

    When calling, definitely use your sister's name, as she is in the industry (so they are more likely to talk to you, rather than think that you are a consumer trying to get around your local retailer).

    In the end, as said above, the right amount to start and how much you can come up with likely won't match - you then need to decide whether you have enough to make a go of it. Many companies that are under capitalized do make it (then again, under capitalization is also one of the main reasons that companies fail...).
  • Posted by Jay Hamilton-Roth on 3/26/2008 at 9:22 AM Accepted
    Is this a storefront or an online business? If it's online, they you may be able to drop ship all your items, thereby eliminating all inventory (and its expense).

    If it's a storefront, instead of starting from no knowledge - work for a store in your greater area. Learn the ropes from a successful business rather than trying to re-invent the wheel. Also, consider teaming up with another pet boutique that isn't in your area, and offer to create an "outpost" - you'd manage, do the lease, get a % of sales, etc (they'd supply merchandise).
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