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These days everyone wants to become a businessperson. The business industry has been booming in India for a decade. Opening a hardware shop in India is one of the easiest and most profitable business ideas you can have.
However, you need to understand and analyze if this business is the right choice for you or not. The fact that this business area has the least restrictions to enter made many choose it and resulted in cut-throat competition over the country.
Any typical hardware store sells hand and labor-intensive tools. Some of them are locks, fresheners, plumbing supplies, paint, cleaning products, etc. You can customize your business based on your business plan and choose to sell different products too.
Not everyone is suitable for this business type. The main customers are generally the tradesmen, Handey mand, and do-it-yourself customers. But if you are ready to start the business feeling that this is the best choice for you, that will be considered the first step into your business.
The following are the next steps you need to follow before starting your business and opting for a business loan or machinery loan.
Research the market location for your business
To open your business, first, you need to find an appropriate location to start. While choosing the location, make sure to understand the competition in that area and how favorable the location is for your success.
Analyze if the location has a high market in your business field and choose a place with low competition but a high market rate. This will help you grow your business potential without losses.
Research the market for products
After finalizing the area you want to set up your business in, the next step is to determine what products to sell in your store. For this, get some tips from the nearby grocery store or Kirana store as those shop owners will have an idea about customer needs in that area. Later, finalize the product type, range, and quality that you want to sell in the store.
Make a business plan
Plan your business before starting it. This will help you understand your needs and the amount of labor you might need. Additionally, you will also be able to finalize a budget and stick to it.
If your savings are not enough to start the business, you can always opt for a business loan or make MSME registration to avail those benefits. Understanding and devising a budget plan will help you determine the investment capital, and how much more you need to expand your business.
Loans, investment, insurance, and expenses:
After figuring out how much investment you have, it will be easy to figure out the type of loan you need to take.
Business loans and machinery loans will help you grow your business and get finances for equipment, respectively. On the other hand, by MSME registration, you can get many benefits from the government.
Choose the best insurance plan for your business that will cover your inventory losses and liability. Basic monthly expenses like rent, insurance, and utilities should be calculated and after you get a profit margin, make sure to study all the GST registration norms and check if you should register your business or not.
An additional source of income
Try to have as many sources of income as possible by expanding your business. You can experiment with the products you sell and increase their range. You can even partner with any companies for the products you supply.
For example, if you are selling plumbing tools, you can make a contract with a plumbing agency and supply your tools to them.
Register your business
Now that you have everything ready to start the business, in this step, you need to register your company. Pick an appropriate name for your business and have the GST registration done as soon as possible. Skipping GST registration can get you in a lot of trouble.
When choosing the name, make sure that the name that you’ve picked is available in the state or not. Also, if you want to have a trademark, make sure that it doesn’t match any existing trademarks.
Open a business bank account
Use a business bank account separately to maintain all your business finances. This way, you will not mix up your assets and business assets and act as a protection for all your money.
This will shield your assets such as money, home, and car from risk in situations such as business losses. Additionally, you can get a credit card in the name of your business which provides better interest rates that are useful to run your business smoothly.
Set up a business team
Make sure to record all the various expenses and income sources to keep track of the financial performance of your business. Have a theme ready to track all these records from time to time.
With the help of this team, the annual filing of taxes will be made easy, along with the timely payment of interest for the business loan or machinery loan that you might have taken. Thoroughly read the GST registration form details and regulations too to avoid further problems.
Get the necessary permits and licenses
Before you start running your business, you should have all the licenses and permits ready with you. These permits will allow you to run your business legally without violating any rules and regulations set up by the state government.
If found guilty of a violation, you might have to pay hefty sums as a fine. And in some cases, your business might even be shut down by the government, even after paying the penalty, as it is considered an illegal business.
You can open a hardware store in India whenever you want if you feel it is an appropriate business area. Just follow the above steps without skipping GST registrations and licensing to run your business successfully.
Frequently Asked Questions
Is hardware stores profitable in India?
While a well-performing hardware store is beneficial. Typical operating profit is between 1.6% and 6%, with a net profit before taxes of between 3% and 7%.
How can I open a hardware store in India?
1) Market Research for business location
2) Market Research for products
3) Figure out a Business Plan
4) Figure out the loan, investment, expenses, and insurance
5) Figure out additional sources of income
6) Register your business
7) Set up your business team
8) Promote your business online/offline
How much does it cost to start a hardware store in India?
However, to start a hardware store with paint, an entrepreneur may need to spend around Rs 5-7 lakh.
How can I grow a small hardware business?
1) Give your customers a reason to return
2) Get found the web
3) Draw customers in with window displays
4) Invest in your staff
5) Talk to your customers
6) Offer additional services to grow your building and hardware business.
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