[Closed] LBS Cost

Depends on what products you intend to stock. High end ? Low end ? Where is the shop ?
£30000 sounds about right
I wouldn't bother....

Been in the trade far to long it's not as romantic as you may think!

mid-high end...nantwich in cheshire...well, it will beat working 60hrs a week for 16k a year....for someone else.

You're opening a shop without an awareness of margins?

one trade i wouldnt borrow money to start up in - it would be the bike trade.

I would say nearer £100k
For a mid end shop.
Workshop would take about £5k
Fit out
Deposit for rent
Four demo bikes £10K

As long as you charge less than online shops, have everything in stock and limitless free workshop servicing you'll be fine 😉
I think you'll probably find you'll be doing long hours for little reward unless you can find a niche.

how did you come up with 100k Sancho, that seems rather excessive, unless you are outfitting a halfords!

fwiw - one of the shops i worked in started in the late 80s - with 1000 pounds.

its watched many many shops with grand designs come and go over the years in the surrounding 25 miles....

how did you come up with 100k Sancho...?

opening a bike shop or 2 will have given him a rough idea...

do biscuits count as an income source?

nantwich - rich town, posh town 🙂 add in an espresso cafe in the bike shop and stock Rapha + carbon and your on a winner.

Nah, Rapha has just jumped the shark.

Now available at Evans.

too many bloody cafes! it's an expanding town too, with only two shitty shops.

I own a small lbs in leeds and we just did a stock take.

Things like air con/heating
Security
You will have to have shutters and a security door and cctv and alarm or I can guarantee you will get robbed probably in the first three months
If you don't have plenty of stock no one will visit your shop
After all the one thing that a lbs has is the chance to touch and feel.
No point showing the customer pictures.
Having to pay a big deposit to the landlord as well as three months in advance etc.
Signage
It's a lot to open a mid end shop.
Maybe start as a workshop based shop with no bikes for example look at als shop in morley

yeah that's the plan really, do the service side of things predominently, profit margins are higher there too from what i have researched. Finding an available shop is tricky though, dont want to be too far out of town but the town centre is expensive, like 40k a year rent and rates!

I'm figuring £30,000 will cover the start-up then running costs of about £4,000-£7,000 a month dependent on season.

I've just finished working in a bike shop (which closed down...) where the rent was £55,000 a year
I'm working in a workshop now, in a well established LBS, where the workshop alone must be most of £30K, including the stock. We concentrate on low-mid range bikes, kids bikes and scooters. I must have £100 (trade £) worth of rim brake pads, and £1000 worth of mechs and shifters in stock alone......
£30,000 will buy you a fairly limited range of low-mid range bikes and some accessories, i'd say. I wouldn't entertain it without £50,000, cheap rent and the ability to plough every penny of the profit back into the business (On stock) for at least 2 years, personally.

30k of stock will fill a corner in most shops, I'd say the 100k is conservative. 10-20k you'll never see again by the time you do fuixtures, fittings, security, shutters etc etc

The old saying is the only way to make a small fortune in the bike trade is to start off with a large fortune

Chrit
£40k a year rent that I guess is a big shop.
Probably twice the size of ours
So if you want to fill it with high end then I would say well over £100k

Cheers chaps,

good for the insight, it appears i have underestimated the amount of stock and it's cost. the shop i was looking it was 97.80sq.m so not massive no, but it's due to the town centre location but i've moved away from that as there is zero parking. i was suprised to find out that rates pretty much match rent. I do have a meeting arranged with a business advisor from my bank next week so hopefully i should be able to get an idea of the ins and outs of what they are able to offer then i'll be able to tailor my business plan for that....all that leaves then is implementation.

There might be some good info toward the bottom under New Dealer Resources [url= http://www.qbp.com/#dealers ]QBP dealers[/url]

The bank should lend however much you need ... up to about 60% LTV including any other mortgages on it ... assuming you've no other borrowing, clean credit, another source of income to cover the first year's repayments, and a watertight business plan.

my mate has just bought out a bike shop and opening it soon with new stuff etc.. exciting times

My first business plan - seriously - specified £300 for tools and £300 for stock (no bikes).

I was perhaps a bit off with that.

Good luck! Think you need a lot more for start up!
Yes I think Peterpoddy hit the nail on the head with putting back any profit into stock/biz.

Yo will be working long hours, for very little money, more so if you a "1 man band" so to speak as you have to do all the ordering, accounts booking in and then fix bikes etc that makes you money.

I started in the trade with very little start up money, but I was targeting cycle (mobile) maintenance/race support/rider skills only to start with and based at home.
I still don't have a "wage" but pay myself (just) enough for own rent/living expenses (very understanding G/F) But I do ride a v nice "demo" bike 😉
I now rent a workshop and built up good basic stock, have good core customer base and I don't sell bikes! (apart from Cotic Frames/bikes)

But selling bikes is a area I am looking into. As a lot of my customer have been asking my opinion on bikes they looking at buying!

As you spotted, parking is important. there is a nice bike shop near me that is flourishing while others are dying and I think one of the reasons is that it is easy to get to by car and park. Some of the other shops have no or only one spot which makes it too risky to drive there so they go to the successful place.

One of the 2 shitty shop owners might be looking for a way out? Buy in/ buy out / rent from them, could you turn one around?

Just a thought.

The problem with buying them out is that they are far too small to be a viable option for me, they are litterally shoeboxes...ok for a hairdressers or 2nd hand bike shop but i want to go contemporary and like a bit of space.

my mate has just bought out a bike shop and opening it soon with new stuff etc.. exciting timesjedi - Member

what part of the world is this ? south of you or north of you ? I think I know who...

its neither south or north of Jedi! google Edds Bikes!

[i]The problem with buying them out is that they are far too small to be a viable option for me, they are litterally shoeboxes...ok for a hairdressers or 2nd hand bike shop but i want to go contemporary and like a bit of space. [/i]

Low-cost and low-risk start and once you are making cash look at a better shop/location - better way of getting/keeping suppliers.

that's a bit of food for thought, not thought of it like that. Loyal customer base already there too.

Crewe is like the Bermuda triangle of bike shops.Trek have been trying to get someone to open one for ever.
The major problem is that within a 25mile radius there are some really good shops,which ties up all the major brands.And without one of the big brands (Trek,Giant,Specialized,Cannondale) it's tough going.
Madison aren't all that keen to open new accounts (until you prove viability) and without them....you're screwed.
It's a saturated market out there,yes a lot more bikes are being sold but there's a hell of a lot more shops selling them.
5 years ago there were 4 shops within a 20 mile radius of Chester.Now there are 11!

£30k ain't going to get you much...mate had a bike shop and when it opened he stocked Lezyne - in a very nice display stand, everything in a place but essentially a set of hangers to hang things off - £12k just for that and the minimum stock that came with it.

The low-end region of the market will get bigger margins and probably sell more so turnover should be 'easier'. After watching him plough 4 years into the business and him ending up having to sell up - I have no desire to open a bike shop - he had a cracking idea, great model but it just didn't work (for whatever reason), a real shame as it was a very good shop.

I'd have another think about how much you need and then how you can pay it back but also invest in the shop to improve it.

Also taking one over means an insight into margins and suppliers. For an outright sale I'd look at buying the stock at cost, fixtures and fittings and goodwill thrown in for free. I'd hold something back for 6 months too in return for the owner training you and assisting with a smooth transition.

Just be careful with due diligence especially over a lease, and make sure you are buying assets only, not an indebted company.

Be Careful.

edds a mate too. but im talking contour cycles to appear in stevenage

Not many decent sized shops in Nantwich, and limited parking around them, Crewe would be a better place for a shop, lower rents, but less money around

Factor in insurance, buisness rates, security, and staff costs, you do want time off dont you,thats before stock, shjop fittings,and bikes along with tools.