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ilona1544
New Pal

2 Posts

Posted - 10/13/2004 :  12:37:07 AM  Show Profile Send ilona1544 a Private Message
[b]Hello everyone!
Would you help me to find some information on how to open knitting store? Where do I need to start and how much investments do I need in the begining?
Thank you![/b]

PamS
Seriously Hooked

USA
943 Posts

Posted - 10/13/2004 :  09:42:56 AM  Show Profile Send PamS a Private Message
If you don't know where to find the answers to these most basic of questions, you really need to ask yourself if this is a whim or fantasy. Most fantasies, like opening your own store, are just that--bearing no relationship to reality. Do you have any idea the glut of new stores that are opening. A love of yarn and knitting is not enough. And, if you believe that you will be able to knit all day--well, I don't know one LYSO who does. My advice aside from give up the idea if you're not independently wealthy is hook yourself up with an LYSO and work there to learn the business first--sort of like try before you buy or in this case, open. Also, do a search on this forum, as this topic has been discussed at length before.

Finally, take two aspirin and lay down on your couch and let the feeling pass.

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ilona1544
New Pal

2 Posts

Posted - 10/14/2004 :  08:03:01 AM  Show Profile Send ilona1544 a Private Message
Thank you for your reply but in my opinion most owners start their businesses from a dream. Your advice on working at yarn/knitting store before openning my own it's a good idea. I was teaching knitting couple years in thouse stores. Does this count?
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mokey
Permanent Resident

15375 Posts

Posted - 10/14/2004 :  08:59:05 AM  Show Profile Send mokey a Private Message
Teaching has merit, but it is not selling. The dream part is important but it doesn't pay bills. You need to first calculate how much money YOU need to live, and include everything. If you have already worked in a yarn shop, you should alreday have a good idea of what sales might be. For inventory, go into your favourite yarn shop, count how mnay yarns are on display and how much they cost. The sock yarn section of one LYS here is worth at least $4000.00 alone!

Have you ever worked in finance, or have some solid business experience? Doing your own tax returns does not count!

If I were to open a shop, I would not do it in my city right now. We have just had 4 new LYS open, and while I wish them all luck, the market will not be able to support that many plus the existing ones for the long term.

Please take a good look at the yarn market where you live(or want to open)to see what's missing, if anything. One of the popular trends now in LYS is to piggy back the yarn shop onto a cafe/bistro, similar to bookstores that have cafes in them. To me that makes more sense, at least where I live, then opening another LYS.

We all want dedicated LYS owners who love what they do, but it needs to generate enough money to support you and your family, if you have one.

"There is no beauty in the finest cloth if it makes hunger and unhappiness." Gandhi
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galleylama
Seriously Hooked

753 Posts

Posted - 10/19/2004 :  10:43:09 AM  Show Profile Send galleylama a Private Message
I think so many of us would love to own a quality shop, making sure all the things we think a good shop should have are included, especially good customer service.
For starters, many local community colleges ofer adult education classes on starting a small bussiness. This would be a great way to explore your idea and get some professional tips and opinions along the way. You will be given many areas to work over to see if you are suited for a small business, able to afford one and where to get help- many cities also have mentor programs staffed by retired business leaders.

It is easier to be forgiven than to receive permission.
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CPAknit
Seriously Hooked

USA
738 Posts

Posted - 10/20/2004 :  08:10:00 AM  Show Profile  Visit CPAknit's Homepage Send CPAknit a Private Message
You can also contact the SBA in your area- (Small Business Administration)- they often have classes for new business owners. I am a CPA who works with alot of small business owners- and one of the hardest part of the job is all of the accounting, administration, bookkeeping, tax and financial work. It is hard to confine yourself to only doing just the part you love. You are responsible for all of these other areas also. Also, a hard fact of life is that 9 out of 10 new businesses fail. So make sure you have financial backup, a way to support yourself for awhile while you are starting out, and a disaster plan. (By a disaster plan, I mean a point at which (decide ahead of time) you will bail if things aren't working out.) Oh- and very important- Be sure to have trusted, competent advisors.

Cindy
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amandaCO
Gabber Extraordinaire

USA
530 Posts

Posted - 11/11/2004 :  08:58:02 AM  Show Profile Send amandaCO a Private Message
I agree with taking local business classes. Often community centers offer free classes once a month and such. As far as back-up income, I've heard don't even expect to break even for several months when starting out. We've had a lot of new shops spring up in my area within the last couple years. I've heard most of the shop owners say they got their tax id and everything set up at least a year in advance. You'll need it to start making orders. The biggest problem when ordering is that yarn is frequently back ordered. So, it's hard to guage how much time it will take you to get in the inventory you need in order to actually open the shop. And all that time that you're just accumulating you probably are paying rent somewhere as well. Also, you should be able to get demographic info for your area that should help you determine if there is actually enough need for a yarn shop. By need I mean not only who would have interest but also money. Too frequently yarn shops cater to the granny types or the new young knitsters instead of striking a balance. You need to cater to who will be buying. After gathering all this info, write out your business plan... you'll need it if you intend to go to the bank and ask for a small business loan to get started. Also, you should be able to find out from some government office (can't remember which) what other yarn shops in the area are netting annually. Pay attention to their advertisements in magazines, too.

Not to be harsh but I tend to agree with PamS, it seems that you really haven't even scratched the surface in figuring out what you need to know. Good luck, though, and if you really want it you can make it happen.
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liberryqueen
Chatty Knitter

USA
103 Posts

Posted - 11/13/2004 :  05:50:48 AM  Show Profile  Visit liberryqueen's Homepage Send liberryqueen a Private Message
ilona1544, I'm glad you did not give up your dream just because PamS said so. Check out your public library. Ask them about small business resources of all kinds. Also, ask them if they have a copy of the 2004 Catalog of Federal Domestic Assistance and use the subject index to look up anything related to entrepreneurship, business loans, small business, (if you're a woman) women-owned business, (if you're a minority) minority-owned business incentives. Here's an interview with 2 yarn shop owners that helps put the hard work into perspective: http://knitting.about.com/library/weekly/aa053198.htm
Both of these owners have success partly because they diversified their offerings to include classes and "beyond knitting" resources, like spinning.

I don't think potential business owners or anybody is served well by being met with negative denial of their intentions right off the bat. I hope you were able to take PamS's reply with a grain of salt and still hold onto your enthusiasm.

I would recommend read, read, read, research, research, research. And keep talking with people (be cautious with the negative ones, they might be protecting themselves from potential competition). In my profession (public librarianship), you do not meet curiosity and enthusiasm with blunt denial and negativity. Where would be as a society if we listened to that?

Also check for small business classes at area community colleges, even universities. They are free in our area.

http://www.librarianknits.com

The web of our life is of a mingled yarn, good and ill together. --Shakespeare
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argoknit
Seriously Hooked

USA
711 Posts

Posted - 11/13/2004 :  8:31:24 PM  Show Profile  Visit argoknit's Homepage Send argoknit a Private Message
Great post liberryqueen! I too am one of the many contemplating opening a shop. I have been contemplating this for the past 2-3 years (I lose track), but I have a notebook full of notes, ideas, thoughts, comments on competitors, etc. And ilona1544, don't be discouraged by the negativity of others. I don't think it is meant that way, but the stats are correct (9 out of 10 businesses fail, etc.) even if it is hard to swallow. I too had and have tons of questions, but it seems that no one wants to provide answers (how much money should I be looking at for startup?). Personally, I am getting a better idea on that, but I know where you're coming from. If the startup dollar amount is too high, maybe it isn't worth the work proceeding any further. You just like to have some idea of what's realistic, right?

At one point I was told that to start a good shop today you need at least $250,000. This is part of the reason it has taken me so long to get going. That number seemed very hard for me to swallow and was very intimidating. I didn't give up, but I started to gather more information to see if this was accurate. I'm finding for my market that albeit $250,000 would make an awesome shop, it isn't necessary. I am looking more along the lines of $30,000-$40,000 if this helps you at all in making up your own mind. It's up to the individual and individual situation.

As far as yarn and distributors - just start calling the yarn companies. Most have numbers and some have email addresses in many ads in magazines. I haven't taken on this task yet as I am still a ways off from opening.

I did recently take my next important big step. I have started scouting locations. I have contacted commercial realtors for lease rates, etc. And at one location I really liked I talked with the owner of the store next door to find out more about her opinion of the location.

I agree with the other posters regarding entrepeneurship classes and starting up small business classes. I have taken several over the past several years because even before I wanted a yarn shop specifically I knew I wanted to go into business on my own. Like I say - I'm cautious and have taken things slow. Area tech colleges, 4 year colleges and training centers usually can fit the bill. I also agree that a visit to your local Small Business Adminstration is immensely valuable. I have visited, but not in awhile and I intend on doing so soon. I need help with the financial part of my business plan. I have tons of scribbled notes about how much things would cost and projected earnings, but I need to put it down in the proper spreadsheets before I can bring my plan to a bank.

And in agreement with some of the posts. Now that I am REALLY intent on starting I am realistically looking 9months to a year out. This isn't going to happen next month. I also intend on keeping my job. The company I am at is pretty flexible and I am going to request backing off my hours from full time to part time. It'll continue bringing in a "regular" income that should cover most, if not all of my personal bills even if the shop can't cover that. That way I can devote any money coming into the shop back INTO the shop.

I apologize for this being so long, but it is disheartening to see all the negatives. I wanted to share at least some hopefully helpful information. So, ilona1544, take a deep breath and start researching, researching, researching. And good luck!!


I'd rather be a failure at something I enjoy, than a success at something I hate. óGeorge Burns
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Ewetopia
Warming Up

USA
81 Posts

Posted - 11/23/2004 :  09:35:37 AM  Show Profile  Visit Ewetopia's Homepage Send Ewetopia a Private Message
Having just opened a LYS I can say it is possible for well under $250,000! What I can't emphasize enough is having a comprehensive, well-written business plan. We wrote one, and then had it reviewed by the local SBA liasion, who gave us great suggestions. So we went back, rewrote it and then she gave us (really my husband, he's the number guy!) the assignment of doing financial statements month to month for the first year and yearly financials for the next five. Having that done helped our loan app sail through the bank. It also helped us think about some expenses that can be easily overlooked. I wish you the best and don't hesitate to use Business Enterprise Center small business resources (ours is affliated with the local JVS)
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argoknit
Seriously Hooked

USA
711 Posts

Posted - 11/23/2004 :  6:25:28 PM  Show Profile  Visit argoknit's Homepage Send argoknit a Private Message
sarb719 --

If you don't mind my asking -- how did you go about financing your shop? It sounds like an SBA loan. How much did you have to fund out of your pocket? A percentage is fine if you're not comfortable with exact numbers. I have a good chunk of my business plan written - but it's still pen and ink and needs to be spiffed up. I plan on taking my bus. plan to our local Small Business Development Center to review it before I present it to anyone.

I don't have much "cash" of my own to foot part of the bill, so I've been considering a home equity loan to fund most of my venture. Do you think that even if I don't have much cash that the SBA would even look at me.

I'm sure you're not an expert, but you've just been through the process. I do plan on asking the SBDC these questions, so don't feel on the spot or anything.

Thanks, argoknit

I'd rather be a failure at something I enjoy, than a success at something I hate. óGeorge Burns
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Ewetopia
Warming Up

USA
81 Posts

Posted - 11/24/2004 :  11:59:48 AM  Show Profile  Visit Ewetopia's Homepage Send Ewetopia a Private Message
I think our part was about 1/5 the total loan. The more you have to put into your store, the better they like it. My husband did the number part, so I can only give you ball park figures. Your contact at the SBA business center can definitely guide you in the right direction. Ours even told us what banks we had a better chance with and exactly what they would want in the business plan and on the loan. Good luck--it can be a really nerve racking process!
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Sabrina Fair
Seriously Hooked

United Kingdom
639 Posts

Posted - 11/30/2004 :  05:31:42 AM  Show Profile Send Sabrina Fair a Private Message
From the above posts the risks are serious whilst it would be a pity to see someone else drive or suceed in your dream. What you need is a realistic compromise which gets you where you want without exposing you and your family to an unacceptable level of risk.

It is possible to start a business incrementally. In this way the store could be a five year goal whilst you work on more immedaite activities which will promote your profile, generate some part-time income and lessen your initail investment but will all enhance your goal and significantly contribute to its potential for success. Something like running your own classes on a theme with you supplying the yarn, craft fairs etc.

All the best

Sabrina


Sabrina fair,
Listen where thou art sitting
Under the glassy, cool, translucent wave,
In twisted braids of lilies knitting
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contrary1
Chatty Knitter

100 Posts

Posted - 01/14/2005 :  07:48:21 AM  Show Profile  Visit contrary1's Homepage Send contrary1 a Private Message
I did almost all of the suggestions listed..........and then I did open a yarn shop. So far, so good. We've been open 7 months now & growing by tiny little steps each month.

I agree, there is a ton of work to do.........all the time. It's the sort of job that the work is never really finished, as you can always think of more to be doing.

Both my sister & I had owned our own businesses before, both involving sewing & or costume design. We had already been involved in the creative side, as well as knowing the requirements of our state/county & federal guidelines for this type of business. I have a couple advantages too, in that I own the property & the building where I put the shop and I have a sister willing to help....she gets no salary as yet. We built the shop to include living space for her, so her expenses are almost nothing. I also have a job which I will keep for approx 5 years, giving me the ability to sort of underwrite the yarn shop during this time.

Anything you read about the numbers needed to start up ANY business......double or triple them! Most of our "hidden" costs cropped up during the construction phase, not the actual shop set up stage however. I also think once you get your shop up and running, that is not the time to stop all research & development.

Being able to knit all day is a fantasy if you have your own shop. I am rarely in the shop all day at a time......... We have joined all community organizations possible (need more days in a month to get involved in more things) but this is a cheap way to get your word out. I have knitting on the needles all the time and it is always with me, but most of my projects get finished because of all the hours outside of the shop!

With all the details in mind, the bottom line for me is..there is nothing like having a career that you love. We made a commitment to spend all our time and energy on the shop for the first year, then we are re evaluating. At that point, we'll decide if we are headed in the right direction, if we can scale back at all anywhere, those kinds of things. We have a motto this year............Be everywhere, all the time! At times we are tired, but it is a Good Tired!!!!

Sue of Country Yarns
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