Opening a shop - dos & don'ts

understandingcocoa · August 2, 2018

So I've just signed the contract for my first ever shop, I'm excited but mostly terrified!!

It's going to be a tiny little chocolate shop, with a few shelves for bars etc, a counter for fresh truffles, and a counter for fresh cookies. Bars & shards etc will be fine with shelf life, with truffles I plan on keeping the range quite simple to start with (8 flavours) and make limited quantities.

I was wondering if anyone had any tips, or any success stories to ease my mind!

Eeeeekkkkk

gfron1 · August 2, 2018

There are lots of us who've made that step so you'll get plenty of advice. My suggestion is sit back, let it roll in and don't respond right away. Let all the ideas from this forum ferment for a bit before making a judgement or explanation or acceptance..

ETA: I am looking forward to offering a more practical response when I get out of the kitchen tonight.

Edited August 2, 2018 by gfron1 (log)

pastrygirl · August 2, 2018

That's exciting! I don't have a retail shop but still have dreams. It all seems so expensive and un-attainable! Part of that is high cost of living where I am, part is that dealing with contractors and construction intimidates me. So I'd love to follow along with your adventure.

I don't recall where you're coming from, so can you remind us of your story - Where are you & how long have you been working with chocolate? How much business experience do you have? How much build-out do you have to do? What do you see as the main challenges at this point?

understandingcocoa · August 2, 2018

1 hour ago, pastrygirl said:

That's exciting! I don't have a retail shop but still have dreams. It all seems so expensive and un-attainable! Part of that is high cost of living where I am, part is that dealing with contractors and construction intimidates me. So I'd love to follow along with your adventure.

I don't recall where you're coming from, so can you remind us of your story - Where are you & how long have you been working with chocolate? How much business experience do you have? How much build-out do you have to do? What do you see as the main challenges at this point?

I'd love you to follow along! Nice to have other chocolatey people on the journey.

I've found it quite intimidating too, especially negotiating with landlords etc - I have no idea what is expected or reasonable!

I'm in the North of England, i've been working with chocolate for about 3 and a half years with no real plan/ structure until more recently. I left my job in October to go full time chocolating and love it! (My bank balance not quite so much). I have retail experience of running shops from my younger years, and sell in local shops but no experience of owning and being solely responsible for a shop.

So, main points/ challenges

- The location is a little high street near home, not the main shopping area of the city by any means but the local community really gets behind the small businesses here

- Rents here are fairly low because it is "out of town" so it's a bit less of a risk

- Shop is teeny tiny - in terms of build out, the landlord is removing a wall & putting in plumbing, apart from that I will be paying for flooring/painting and furniture, oven etc

- As much as I plan, footfall is really hard to estimate so getting enough sales is a bit of a concern

- Hoping to entice people in for easy sales with hot fresh cookies, hopefully these will help tide us over if sales are slow

- Again, if sales are slow, fresh truffles in the counter would obviously create a lot of wastage - although perhaps I just do tiny batches to make sure they sell out

- Big initial out lay which is scary

Sorry for the babbling, my brains going a million miles an hour!

Rajala · August 2, 2018

Sounds like this will be quite an interesting thread! I'm thinking about trying to do some online sales as well. We'll see how that goes hah. I can't even make anything at all due to the heat now, but I'm trying to plan some.

pastrygirl · August 2, 2018

Cool, so it sounds like you've already gotten some exposure in your area, and nice that the landlord is doing the plumbing. I feel like sales & marketing is the hard part for a lot of makers. Good product alone isn't enough 😕

Tri2Cook · August 2, 2018

40 minutes ago, pastrygirl said:

I feel like sales & marketing is the hard part for a lot of makers.

I think that may be the biggest challenge for me when I'm feeling ready to step things up. I very much prefer to remain the Igor in his dungeon putting his monsters together and remaining hidden from the villagers. But my stint in catering taught me that as a general rule, the villagers don't like that when you're wanting them to spend their money.

gfron1 · August 2, 2018

Here some things to consider:

-Visit any and every shop you can and see what you like and don't like from paint, to lighting, to signage, customer interaction, packaging, music/sound, smells, clutter/cleanliness; and keep notes so you remember what stands out to you.

-What direction is your window facing? A big, big name pastry chef opened in my town recently and I went in to support him on opening day only to find his full line of bean-to-bar chocolate bars in clear packaging on a shelf perpendicular to his main south facing window...every one of them had bloomed. Message...think about the sun throughout the year and how it will effect the use of your space.

-Everything needs an upsell or a co-sell. EVERYTHING. Its hard to make a living selling a cookie. But if someone wants a cookie, a bakers dozen may be attractive, or a hot tea to go with the biscuit. For me, I never sell individual chocolates. I used to sell 5 boxes, now only 10s. That's a personal choice based on customer feedback. If they buy the cinnamon cookie you offer them the chai bonbon...I think you see where I'm going with this. Over the years I've learned that customers don't really know what you have to offer, they came in for one thing, and they did that because they like your food, so make sure they know what else you have to offer that they likely will enjoy as well...verbally, not just in signage.

-Even in a small space, try to create a decompression zone at the entry way. Think about most larger groceries...they want you to walk in, orient yourself, then get serious. The good ones don't over clutter the front because your mind doesn't relax enough to be open to everything that is coming (this is a researched subject not my own theory).

-Create partnership even before you open. Any complimentary business - galleries, B&Bs, museums, possibly coffee shops if its not competing, your immediate neighbors for sure, office buildings (think end of year corporate gifts), realtors (they blab a lot), certainly any food blogger, media...on and on...take them a gift basket with a generous sampling of your creations - the investment WILL pay off; and then invite them to a VIP pre-grand opening the night before you open to the public so they feel special. If anyone is a super duper VIP then give them a private invitation to come by even earlier - this might be the newspaper editor.

-Think about what charities you might want to support. I built my last restaurant with 100% charitable giving versus advertising and it paid off in dividends with how the community viewed us.

-As for landlords, they are tough. Just remember: honey not vinegar.

-Be sure that the lease is specific about who repairs any mechanical stuff? Lighting, refrigeration, air conditioning, broken windows, etc.

-Do your best to be a cash-operating business instead of building up debt. That won't be easy, especially at first, but any time you can pay immediately, do it. That will train you to be efficient and non-wasteful.

-If you haven't already get your web presence going! Website, facebook, instagram, and even twitter. Now, not later. In FB and IG, use stories liberally - they are the future.

(I'll stop for now and see what else comes up later)

Edited August 2, 2018 by gfron1 (log)

ChocoMom · August 2, 2018

30 minutes ago, gfron1 said:

-Create partnership even before you open. Any complimentary business - galleries, B&Bs, museums, possibly coffee shops if its not competing, your immediate neighbors for sure, office buildings (think end of year corporate gifts), realtors (they blab a lot), certainly any food blogger, media...on and on...take them a gift basket with a generous sampling of your creations - the investment WILL pay off; and then invite them to a VIP pre-grand opening the night before you open to the public so they feel special. If anyone is a super duper VIP then give them a private invitation to come by even earlier - this might be the newspaper editor.

This.

And radio stations. Here in the states, esp in the smaller community areas, if a food-based business drops off goodies in the am, during the travel hour(s), that company gets loads of free air time/advertising from the talk show hosts. Hospital gift shops are another avenue for business.

I'm guessing you might have retirement homes over there? Offer to do a chocolate demo for an afternoon activity. Bring your business cards, and samples of your offerings, and packages available to purchase. About 15-20% of my customers have come via the local retirement village here- and those folks have LOTS of connections in the community- which equates to lots more customers. Each spring, I do a demo. I sell everything I bring, and walk out with hundreds of $ in orders, and they light up my phone during the holidays. I deliver the items to them, and since they're all in one place- its easy.

If you have connections to any hotels, friends or family that work or manage one- see if they will let you put some packages for sale (in accordance with your food laws, of course.) I was very blessed to have connections several hotels soon after I moved to my current location. I'd deliver, or send my hubby to deliver orders when he was traveling. It was a source of steady, monthly income I'd often forget about. Always a nice surprise to get an envelope of cash in the mail!

My first shop was pale pink and espresso brown, with lots of vintage style decor. Lost all that in a fire- but it was wildly successful. Current shop is built onto my house. After entry through the porch, and foyer, the interior of the shop is again pale pink. When I get around to it, I'll add more decor. It's kinda bland now.....but people here loved that whimsical color and design. But like @gfron1 said-- you need to examine your area shops and see what the successful ones are doing in terms of decor and design.

Don't skimp on your presentation packaging either. I go all out on that, and it pays off.

Investing the time to travel a bit to a busier area, to a bridal expo or craft show are great places to show off your goods, sell, and get your name out there. Most years, I do some sort of chocolate sculpture that samples can be set in or upon at one or two shows. Samples sell the products at these busy shows, but having an edible tiered stand, or bowl and pedestal is the cat's meow. The customers will place orders, and have no problem enjoying a drive out in the country to find me and pick up their goods. I suspect the same would work for you. (Though, I haven't a clue how near or far you might be from a larger city. ) All things to consider though.

I wish you the best of success, and can't wait for updates as your business progresses!!!

Andrea

pastrygirl · August 2, 2018

48 minutes ago, gfron1 said:

In FB and IG, use stories liberally - they are the future.

ya think? I still don't understand the appeal of 'stories' over regular posts to your feed

gfron1 · August 2, 2018

5 minutes ago, pastrygirl said:

ya think? I still don't understand the appeal of 'stories' over regular posts to your feed

I agree wholeheartedly. I think stories are stupid. They last 24 hours and poof!

...

That said, they are getting more eyes than static posts because of how the algorithms work nowadays. No platform offers chronologic timelines anymore so you go where the eyes are. And I'm not suggesting one versus the other. My quality pics are a regular posting IG-shared to-FB. My lower quality pics or videos are stories. My high quality pics are added to my stories.

pastrygirl · August 3, 2018

41 minutes ago, ChocoMom said:

I'm guessing you might have retirement homes over there? Offer to do a chocolate demo for an afternoon activity. Bring your business cards, and samples of your offerings, and packages available to purchase. About 15-20% of my customers have come via the local retirement village here- and those folks have LOTS of connections in the community- which equates to lots more customers. Each spring, I do a demo. I sell everything I bring, and walk out with hundreds of $ in orders, and they light up my phone during the holidays. I deliver the items to them, and since they're all in one place- its easy.

...

Don't skimp on your presentation packaging either. I go all out on that, and it pays off.

It might be different if it's the local neighborhood residents out for their daily stroll, but I've found that senior citizens tend not to be great customers, except when buying cute holiday things for the grandchildren. My take is that fixed incomes plus health or dental issues get in the way, plus older clientele often want more plain or classic flavors. It'll take some time to see who wants what.

Re:packaging ... uuuuuuuuggggggghhhh. How much does 'all out' cost you? How much of the retail price do you allow for packaging? I'm working on packaging again, or still, and it's so frustrating. How do you make money, just charge more? I could probably charge more anyway 🤔 My packaging goal is to streamline the process and increase margins ... not to hijack, if OP is in a few stores already, hopefully their packaging is already sorted out.

Edited August 3, 2018 by pastrygirl (log)

Bentley · August 3, 2018

I'm going through the same process.....so much to work through. Equipment, suppliers, packaging, website, point of sale systems. You have to become an expert in so many areas to make sure you are getting the best for your business.

It's not for the weak. One tip i will give is to peruse fiverr.com for creative needs - logos, flyers, basic websites, etc. Some great designers there at very reasonable costs.

Edited August 3, 2018 by Bentley (log)

pastrygirl · August 3, 2018

18 minutes ago, Bentley said:

I'm going through the same process.....so much to work through. Equipment, suppliers, packaging, website, point of sale systems. You have to become an expert in so many areas to make sure you are getting the best for your business.

It's not for the weak.

Most small businesses I know use Square for their POS. I've used it for years just on my iPhone, would get a tablet or terminal if I needed to upgrade. Likewise, the website templates like Squarespace and Wix make it easier. You still have to do some input - write copy, take pictures & upload them - but the shopping cart is built in and you can put something together without knowing how to write code.

understandingcocoa · August 4, 2018

On 8/2/2018 at 10:30 PM, pastrygirl said:

Cool, so it sounds like you've already gotten some exposure in your area, and nice that the landlord is doing the plumbing. I feel like sales & marketing is the hard part for a lot of makers. Good product alone isn't enough 😕

On 8/2/2018 at 11:20 PM, Tri2Cook said:

I think that may be the biggest challenge for me when I'm feeling ready to step things up. I very much prefer to remain the Igor in his dungeon putting his monsters together and remaining hidden from the villagers. But my stint in catering taught me that as a general rule, the villagers don't like that when you're wanting them to spend their money.

Haha I also enjoy hiding from the villagers, i like to think of myself as the mysterious chocolate lady. It's definitely hard selling yourself, I think I need to be more confident in pricing for this reason.

understandingcocoa · August 4, 2018

Thanks for all the tips @gfron1 really appreciated, so many little things you don't think of yourself.

Have you found you sell less boxes now that you got rid of the 5's? I like the idea of sticking to limited options, people usually don't debate if there isn't a different choice to make I suppose.

Newspaper editor is definitely a good shout, the local paper here is quite fond of getting involved so that's a plus. What are peoples thoughts on opening weekend deals? It would be great to get a buzz going....hopefully with enough social media marketing it would be enough to lure people in. Can't quite decide what format to do this in, free X to the first 50 people, 2 for 1 on something etc....

@ChocoMom I've never considered retirement homes, this sounds like such a good idea! I have no idea what the retirement community round here is like, it's quite Yummy Mummy, I will research. Something I am getting involved with is WI groups, do you have these over there? Doing some tasting events and hoping to build a good relationship with them as I imagine they're very involved in the community too.

When you say packages for hotels etc. do you mean like gift baskets? Or like event packages? I've been reluctant to approach hotels as I'm not sure what they expect, similarly with approaching corporate clients.

My shop is going to be pale pink too! (Although sad to hear about the fire!) The landlord laughs at me every time I tell him my plans which is mildly discouraging, as he doesn't understand why I wouldn't do it all as cheaply as possible, but I've always had such a clear idea of what I want it to look like, pale pink with a black & white chequered floor (instagram bait).

There's only really one other independent chocolate shop in the area, they sell a lot of other brands wholesale and have a limited selection of their own products. It's hard to tell how they're doing but they've been there a loonng time and in a much higher rent area, so I see that as a good sign.

understandingcocoa · August 4, 2018

On 8/3/2018 at 1:01 AM, pastrygirl said:

Re:packaging ... uuuuuuuuggggggghhhh. How much does 'all out' cost you? How much of the retail price do you allow for packaging? I'm working on packaging again, or still, and it's so frustrating. How do you make money, just charge more? I could probably charge more anyway 🤔 My packaging goal is to streamline the process and increase margins ... not to hijack, if OP is in a few stores already, hopefully their packaging is already sorted out.

Luckily I've just had my packaging properly done for the first time, it's what convinced me to go ahead with the shop. I was really lucky and got a grant so all the design/ structural work was completely free - is there anything like that you can take advantage of?

Although a lot of shops i've seen seem to still do very well with basic packaging, i.e plastic bar bags and printed stickers. Mine will be a slow process of improvement I think, I absolutely love the new branding but there are still a million little additional things I need to do 🤪

Re your Q on price, I upped my prices with the new packaging, but with the right packaging it looks so much more expensive so it's more than justified, my packaging for bars is approx... 7/8% of retail price, it's slightly more for boxes etc.

understandingcocoa · August 4, 2018

10 hours ago, Bentley said:

I'm going through the same process.....so much to work through. Equipment, suppliers, packaging, website, point of sale systems. You have to become an expert in so many areas to make sure you are getting the best for your business.

It's not for the weak. One tip i will give is to peruse fiverr.com for creative needs - logos, flyers, basic websites, etc. Some great designers there at very reasonable costs.

You're right, I think i've accepted that it's going to be a bit of trial and error. Does anyone else use izettle? I use them for markets so think I will continue on for the shop, perhaps link it up to an ipad to use as the till screen.

Just had a browse on fiverr, thanks for the tip!

gfron1 · August 4, 2018

Quote

Have you found you sell less boxes now that you got rid of the 5's? I like the idea of sticking to limited options, people usually don't debate if there isn't a different choice to make I suppose.

Who knows how many sales I lose by not giving more options, but I barely keep up as is, and I factor in my time to package and staff. I strongly believe that if you have a great product options are not important. But you have to get to the point where people know that your quality is that good.

Quote

What are peoples thoughts on opening weekend deals? It would be great to get a buzz going....hopefully with enough social media marketing it would be enough to lure people in. Can't quite decide what format to do this in, free X to the first 50 people, 2 for 1 on something etc...

. Free samples, but not free. A free sample will lead to a purchase. Possibly live music, free drinks, champagne toast/ribbon cutting...

Quote

When you say packages for hotels etc. do you mean like gift baskets? Or like event packages? I've been reluctant to approach hotels as I'm not sure what they expect, similarly with approaching corporate clients.

I'm thinking guest amenity gift baskets, but it depends on the hotel. Make a really nice basket and then ask for a meeting with the GM or the Event Manager and just see if they have any interest and what they would need.

Kerry Beal · August 4, 2018

4 hours ago, understandingcocoa said:

Haha I also enjoy hiding from the villagers, i like to think of myself as the mysterious chocolate lady. It's definitely hard selling yourself, I think I need to be more confident in pricing for this reason.

Don't underprice for sure! When someone comes in and tells you how many Hershey (I guess I should make that Cadbury given your location) bars they can get for the same price - smile, bite your tongue and give them a little sample so they'll remember what they are missing when they buy that next bar.

Edited August 4, 2018 by Kerry Beal (log)

Tri2Cook · August 4, 2018

11 hours ago, Kerry Beal said:

Don't underprice for sure! When someone comes in and tells you how many Hershey (I guess I should make that Cadbury given your location) bars they can get for the same price - smile, bite your tongue and give them a little sample so they'll remember what they are missing when they buy that next bar.

Pricing is another thing I wrestle with. Heck, might as well be honest and say I wrestle with almost every aspect of the business end of it. But I only wrestle with it in my mind at this point so that's not so bad. I've recently been wrestling with ideas for a name just so I can start putting together an online presence and even that is a struggle.

pastrygirl · August 5, 2018

On 8/4/2018 at 12:43 AM, understandingcocoa said:

The landlord laughs at me every time I tell him my plans which is mildly discouraging, as he doesn't understand why I wouldn't do it all as cheaply as possible

This is a conundrum indeed. Of course you want a cute little shop, inviting and high-end with beautiful displays. The planning and dreaming is half the fun. You want to paint and make it your own and have nice things. But will these nice things actually make you money and if they don't, is there a re-sale market? For years, working in restaurants I wondered why chefs always seemed so tight with a dollar. Then I quit my day job and realized that a dollar is harder to make and to keep than it seems.

I mean, you might want to spring for another melter and some new molds but you probably don't need a $20k Selmi at this point. Unless you're independently wealthy ... I think it's not that small businesses fail exactly, but that people get tired of just breaking even. We do it because we love it and try to make it work, but how many of us will be able to retire on all the money we made?

Another chocolatier in town opened a cute little retail shop, then because that didn't really support itself they did a kickstarter campaign and opened a second with a super fancy espresso machine to drive business. And they have a 3rd rent to pay on kitchen space ... that's a lot of rent to pay plus the cost of the build-out. Will they end up like the eclair lady who shut down after 2 years and is trying to sell her high end toys like a pasteurizer and a depositor? They spared no expense outfitting the production kitchen plus had a cute little storefront downtown, could have done high volume but I think it just never really happened. People didn't understand, or didn't want to pay $6 for an eclair. That's why you start out with DIY and used equipment Chocolate is an easier sell but yes, you'll still have people who would be just as happy with Cadbury.

But, hopefully you'll be open in time for the holidays and you'll be busy all winter and loving it.

Edited August 5, 2018 by pastrygirl (log)

understandingcocoa · August 5, 2018

3 hours ago, pastrygirl said:

This is a conundrum indeed. Of course you want a cute little shop, inviting and high-end with beautiful displays. The planning and dreaming is half the fun. You want to paint and make it your own and have nice things. But will these nice things actually make you money and if they don't, is there a re-sale market? For years, working in restaurants I wondered why chefs always seemed so tight with a dollar. Then I quit my day job and realized that a dollar is harder to make and to keep than it seems.

I mean, you might want to spring for another melter and some new molds but you probably don't need a $20k Selmi at this point. Unless you're independently wealthy ... I think it's not that small businesses fail exactly, but that people get tired of just breaking even. We do it because we love it and try to make it work, but how many of us will be able to retire on all the money we made?

Another chocolatier in town opened a cute little retail shop, then because that didn't really support itself they did a kickstarter campaign and opened a second with a super fancy espresso machine to drive business. And they have a 3rd rent to pay on kitchen space ... that's a lot of rent to pay plus the cost of the build-out. Will they end up like the eclair lady who shut down after 2 years and is trying to sell her high end toys like a pasteurizer and a depositor? They spared no expense outfitting the production kitchen plus had a cute little storefront downtown, could have done high volume but I think it just never really happened. People didn't understand, or didn't want to pay $6 for an eclair. That's why you start out with DIY and used equipment Chocolate is an easier sell but yes, you'll still have people who would be just as happy with Cadbury.

But, hopefully you'll be open in time for the holidays and you'll be busy all winter and loving it.

Oh yeah I'm totally with you here. Something that held me back was the fear of investing everything I have and losing it all - and the huge amount of extra pressure that comes with knowing you've spent so much!

This shop is sort of the perfect stepping stone, lower rent & lack of various other normal fees means it's the least risk I could have taken. Fingers crossed kitting out the premises is actually going to be fairly reasonable from current projections, I'll be building as much as possible myself, I think the main cost will be the custom counter, and the only thing I won't be able to take away with me is the paint on the walls and the flooring!

Haha yeah I'll give the 20k selmi a miss for now, hoping just to carry on with my current equipment for as long as poss with a few extra basics.

Yes that's the plan, really hoping to be up and running by October and start off with a bang for Christmas.... I'll keep you posted 😅

understandingcocoa · August 5, 2018

On 8/4/2018 at 1:07 PM, Kerry Beal said:

Don't underprice for sure! When someone comes in and tells you how many Hershey (I guess I should make that Cadbury given your location) bars they can get for the same price - smile, bite your tongue and give them a little sample so they'll remember what they are missing when they buy that next bar.

I know you're right, I've just got to build up that confidence!

understandingcocoa · August 5, 2018

On 8/4/2018 at 12:42 PM, gfron1 said:

Who knows how many sales I lose by not giving more options, but I barely keep up as is, and I factor in my time to package and staff. I strongly believe that if you have a great product options are not important. But you have to get to the point where people know that your quality is that good.

. Free samples, but not free. A free sample will lead to a purchase. Possibly live music, free drinks, champagne toast/ribbon cutting...

I'm thinking guest amenity gift baskets, but it depends on the hotel. Make a really nice basket and then ask for a meeting with the GM or the Event Manager and just see if they have any interest and what they would need.

Good point, it was such a good feeling to turn down a wholesaler trying to batter me down on prices because I've started to recognise when things aren't worth my time - took a long time not to just grab every opportunity with both hands.

Haha I'd love to have something that fancy, however I think a max of about 8 people could fit in the shop at once 😂

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