Opening a boutique is expensive and that cost can be the downfall of many new retailers. But what does this money actually go towards, and how much do you have to budget to open the store of your dreams?
New research from business price comparison site Quotemyenergy breaks down the costs of opening your own boutique based on UK averages – from registering the company name to employee pension schemes.
Registration, Filing and Insurance Costs
Trademark Search: You may have thought of the perfect name for your boutique, but first port of call is checking if it’s available by conducting a Trademark Search, costing £96 on average. Requests can be made through the National Business Register.
Incorporate a Limited Company: Forming a Limited Company protects the owners of a company through ‘limited liability’, which means they are only responsible for business debts up to the value of their investments, or what they guarantee to the company, and costs £12.
Public Liability Insurance: Public liability insurance, costing around £120 on average, protects you when dealing with customers.
Retail Space Rental: The average UK cost of renting retail space is £35,000. If you are able to consider purchasing retail space, the recommended amount to budget for is £275,000.
Other Costs: Budgeting for a new store involves so many accumulative costs that it can be easy to forget quite substantial bills such as gas and electricity for your retail space. On average, heating and lighting your dream boutique costs £4,500 each year.
Total: From £39,500
Computer: Particularly if you’re looking to add an online arm to your business, each employer will at the very least need a computer, which cost an average of £200 each – a figure that can easily snowball alongside accessories and even additional laptops.
Tills: Getting your new store kitted out with somewhere to take your earnings can set you back around £1,125 for each till – more if you’re investing in numerous card readers or other payment technology.
Total: From £1,325
Salary: Bear in mind the average UK salary is £27,195 for full-time employees and that planning for employees is key when considering yearly costs of a start-up.
National Insurance Contribution: Works out as £1,929.79 based on the average UK salary.
Employee Pensions: All companies have to offer a workplace pension scheme to employers, regardless of size, costing £905 based on the average UK salary.
Total: From £30,029.79
Goods: All retailers need goods to sell to their customers and this can come with a hefty price tag. For luxury jewellery or fashion, costs start at around £15,000 for little-known designers and climb exponentially from there! If you’re selling your own wares, you’ll also need to factor in the price of the materials you’ll need, and any space you’ll likely want to create your goods.
Delivery: Whether you’re planning to offer delivery to your customers’ homes, or just need a way of bringing your stock in-store, you’ll need to budget for delivery costs. A new van could set you back somewhere in the region of £20,395, while a second hand purchase would also be over £12,000.
Total: From £27,000 upwards
Web Domain: It’s hard to imagine setting up a company now purely in the physical world without any online presence. Registering for the web domain of your choice (that has to be unique) costs £50.
Web Design: Unless you’re a graphic designer, hiring one to design your site will cost around £900.
PR/Advertising: The price promoting your fantastic new boutique is very flexible and depends on what you want – or need – to achieve, but the average cost across retailers in the UK is £24,000.
Total: From £24,950
Grand total: upwards of £123,032.79
When starting a new business, striking the right balance between creative energy and financial knowledge is imperative. These costs are a good place to start working out just how much you need to initiate, and then maintain, your dream boutique.
To help budding retailers on the road out of budgeting stress, QuoteMyEnergy have created a business calculator for totalling up the costs that entrepreneurs might never have even considered before. You can try it out here to get a personalised cost for your dream retail business and start saving today!
Photo by Clem Onojeghuo on Unsplash