Almost every household in the country will visit a hardware store at least once a year. This business potential is one of the reasons that a hardware store has always been one of the most popular businesses that an owner can start or buy.
The generic hardware store exists in the mind as a retail store that a person can go to and buy the correct nut and bolt or odd-sized bolt. This mythical store is run by knowledgeable people who can answer just about anything that has to do with home repairs. This is what the public expects when visiting a hardware store. Some chain stores have moved away from the help side of hardware stores and only sell ready-to-use products. Getting answers to questions at these stores is not what the hardware store visit is all about. The great help of the old hardware store is missing. Except for those stores that operate the old fashioned way and continue to thrive, as their customers are regulars and would not think of going anywhere else to shop. Two franchises that continue this tradition are partner stores True Value and Ace Hardware.
True Value Stores
True Value is the third largest cooperative in the hardware business. True Value is a cooperative that allows the store owner who is a member to buy merchandise at reduced prices as this group can make large bulk purchases. Store owners can also enjoy the benefit of group ad shopping. Being able to buy at high volume prices makes the advantage generate significant profits. Group advertising can also reduce the cost of attracting customers to the store.
The average investment of the True Value store
The average investment in a True Value store is approximately $ 35 per square foot for inventory. Accessories or equipment will cost about $ 8 per square foot. The initial cost may vary by area of the country, but the average is about $ 4 per square foot. The additional cost to become a True Value store can be found by contacting the True Value company.
Ace Hardware Stores
Ace Hardware is the largest hardware cooperative. Like True Value, it offers members the ability to purchase merchandise through the cooperative at reduced prices and thus earn more profit from sales. They also offer the advantage of group advertising that reduces the cost of getting customers through the doors.
Group buying from the cooperative saves all the member’s money, as the cooperative gets better prices due to the large volume of purchases. These savings are then passed on to members and allow them to earn more money.
Ace Hardware investment structure
Ace membership application costs around $ 5000 Initial share ownership costs another $ 5000. The liquid capital needed to start a store is $ 250,000 with an Ace loan for an additional $ 390,000 to $ 740,000, which It depends on the size of the store. The total investment is between $ 650,000 and a million dollars.
Ace’s investment numbers are based on a 12,000-square-foot store. Dollar amounts are for accessories, inventory, office equipment, computer system, and operating costs.
Other factors that will help the owner.
Both hardware operations offer owner training and seminars, which are designed to help the store grow. Suggestions for operating the store more efficiently can be taken and used to good effect. Special purchases that include a targeted advertising campaign will attract customers to the store. The helpful attitude of the staff will impress customers and ensure that they return.
Buy a local hardware store
Local stores that are affiliated or not come out on the market from time to time to buy. The owner may be willing to make a very favorable deal to make the sale. Contact a business broker or look for listed businesses for sale online. It may be wise to contact a good business broker, as these professionals are very good sources of current information. If an existing business is for sale, the price may be great due to the establishment of the store. A cash flow store is always a business to consider. Customer habits favor the new owner as long as service remains the same or improves. If you are going to make any major changes, make sure they are well thought out before you implement them. If there is a great benefit to customers, they will probably be greeted with enthusiasm.
A former owner may be willing to help with the financing of the business. In most cases, the price of the business will increase a bit and will have to be negotiated as part of the sales contract. The other way to get the money you need is to see if a commercial lender would be willing to give you the necessary loan. Many of these lenders are easily found on the Internet.
Conclusions
The hardware business is a business that has a variety for customers who need what the store offers. Any person of legal age is a potential customer. This large potential customer base is what will make a new hardware store quickly grow and profitable in the right location. . As with all retail stores, location is important. Name recognition is also very useful, which is why the two cooperatives have so many members. Customers will come to a store with a familiar name.
Friendly, helpful and knowledgeable staff is essential if you want to stand out from the cashier shops. Their prices will be competitive with yours, so you have to beat them by having better help. If you try to compete on price alone, you will be fighting a losing battle. Store hours are also important in this business. Early openings are almost a business necessity. People like to get up and start projects.