Do you like beautiful leather objects, handbags, wallets, and cases of all kinds that are the object of your attention, even your obsession, and have decided to open a leather store? Do you want to open your handbag kiosk in crowded shopping centers?
Good news: we are supporting you in this entrepreneurial adventure by detailing the significant steps necessary for the success of your project.
From the market study to the business plan of leather goods, through the choice of legal status and the marketing plan, let's see together the procedure to start your leather goods retail business successfully.
The first step in opening a leather goods store is to carry out a market study in order to make sure that there is indeed an unmet demand for this type of business in the area of the planned establishment.
To do this, you will need to:
The leather goods business is doing well right now. The turnover of the French leather goods industry represented 2.9 billion euros in 2018, up 6% compared to the previous year. Today, we are indeed witnessing an increase in sales in terms of volume and value, and this trend should continue.
The luxury sector drives the leather goods sector, and French know-how in fashion leather accessories is notably recognized abroad. And This is evidenced by exports from the leather sector, which jumped 6.9% in the first quarter of 2020.
But beyond luxury, which attracts many abroad, the leather goods market offers an extensive range in France, including entry-level products, which makes it possible to buy pleasure at low prices. Therefore, the sector's industry is particularly vigilant in regularly renewing its collections and sticking to trends, constantly offering new colors, materials, shapes, etc.
Currently, independent multi-brand stores are subject to extreme competitive pressure.
Indeed, on entry-level and mid-range products, large food stores (Leclerc, Auchan, Carrefour, etc.) and large ready-to-wear groups such as Zara, H&M, or Mango, which offer a more and more developed "accessories" offer, gnawing market share.
The situation is hardly more desirable in the high-end and luxury segment because many brands, such as Gérard Darel, Maje, Tara Jarmon, Sandro, etc., have developed a range of "accessories" which overshadows classic multi-brand leather goods stores. Department stores are also a significant player in this very competitive sector.
Nevertheless, the specialized trade remains, with 70% of the market share, the leading distribution channel for leather goods.
Your market study of the leather goods sector will help define your concept and positioning (multi-brand or exclusive retailer? Entry-level? Mid-range? High-end?) And to determine whether it is better to open your structure as an independent or by becoming a franchisee. Or, of course, if you prefer, take back an already existing leather good.
In this powerful competitive context that characterizes France's leather goods sector, it will undoubtedly be easier to join a network of stores under banners. Not only will you benefit from the brand's notoriety (and its communication actions at the national level), but this option will also allow you to benefit from the supply conditions negotiated by the network. It will thus prevent you from having to canvass yourself. - even suppliers.
Many brands offer entrepreneurs the opportunity to get into the leather goods franchise sector. We can, for example, cite Lancel or Le Tanneur for the high-end segment, but also brands such as Lollipops, Misako, Arthur & Aston, Misako, or even Un jour un sac, which offer more accessible products.
Location is the key to a successful business. A good or bad geographic location will have a significant impact on your turnover, so be sure to choose the location of your leather goods carefully.
The concept and positioning of your leather goods will largely determine the ideal location of your store. Indeed, an entry-level or even mid-range store will easily find its place in a shopping arcade or a commercial area. On the other hand, a high-end leather goods store will have every interest to attract its customers to locate in a shopping street in the city center or an upscale residential area.
However, keep in mind that a shopping street will have a higher cost than a location a little further out of the center. So it's up to you to find the right balance, significantly depending on the surface area you will need to display your products.
When creating leather goods, as with any business creation, you will have to choose the legal status of your structure.
The choice of status is tedious and may seem entirely irrelevant, but make no mistake, it is a fundamental prerequisite for creating your business.
Your legal status will determine in particular:
Choose the legal status of your leather goods so that it is consistent with your project and the way you envision the development of your business.
Once your market research has been carried out, your concept well defined, and the location of your leather goods chosen, you can then devote yourself to the provisional budget.
To establish your estimated budget, you will have to start by listing and quantifying the human and material needs necessary for the opening of your store.
Leather goods must, of course, have large displays and windows where you can showcase your merchandise. As your offer generally ranges from a cardholder to a travel bag, you will need more or less large display spaces to display your items.
Also, plan some decorative elements and some furniture (if only the counter to accommodate the cash register) and, of course, all the features necessary for the sale: computer workstation (s), payment terminal, gantries security, etc.
You will also need to reserve a significant portion of your budget to acquire your initial stock.
Buy Backlit Signages for your handbag retail shop!
You will also need to take your staffing needs into account when establishing your estimated budget.
Therefore, you will have to estimate the number of salespeople and customer advisers you will need based on the surface area you have and your opening hours.
It is essential to recruit people who are passionate, like you, by beautiful leather objects at the staff level. This advice is all the more critical if you are targeting the high-end leather goods sector. Then try to recruit staff with experience in this universe, or, at least, who are particularly sensitive to it and eager to work there.
In addition to your material and personnel needs, remember to consider in your provisional budget all the ancillary services essential to the opening of your leather goods.
These include your store's insurance and the bookkeeping of your business, maintenance, and marketing.
To precisely quantify these expenses, do not hesitate to ask for quotes from professionals and then run the competition to obtain these services at the best prices.
To build up a clientele and retain it, you will need to set up a marketing plan.
There are many possibilities here. The distribution of flyers in the street or mailboxes can help you get to know the inhabitants of the district in which you are established.
You can also invest in advertising space for local media or even have yourself listed on the directory of merchants in your city, but also Google Map.
Also, think about the fantastic opportunities that the web and social networks represent. Even if you don't sell online, it's a good idea to have a website that will showcase your store, its physical address and opening hours, and your positioning with beautiful product photos.
In addition to or as a replacement for a website, invest in social networks. Facebook will make it possible to disseminate information about your store and news (promotions, new range, etc.), but also customer opinions. Instagram will further enhance the promotion of your products through beautiful photos of bags or wallets in sophisticated scenography.
There are many other possibilities of action to be taken to acquire and retain a large clientele. It is up to you to set your objectives and the means implemented to achieve them in a detailed marketing plan, providing information on the cost of these actions and the expected benefits.
The realization of the business plan intervenes after all the preliminary stages seen previously.
Indeed, the business plan of leather goods is synthesized, quantified, and argued. And of the studies that you will have carried out (market study, choice of concept and definition of the project, legal status of your structure, human and material needs necessary for the opening of your leather goods, marketing plan, etc.)
The business plan must contain a provisional budget highlighting the project's financing needs and its potential for profitability.
These financial details are essential because the business plan serves above all to demonstrate that the project is coherent and viable to obtain financing from your bank or potential investors. It must, therefore, obviously be perfect both in substance and in form.
Suppose you are a little apprehensive about the idea of embarking on the development of your business plan, given the challenges, or simply because you have never done one before. In that case, a good solution is to use a business software plan online.
Using specialized software allows in particular:
The last step in opening a leather goods store is the search for financing. The amount you will need will depend on your commercial positioning and the size of the store.
If the equity is lacking, you can turn to several financing solutions.
The first way to finance a business creation, which comes to mind, is undoubtedly the bank loan. You can also look for private investors, call on your relatives, or even crowdfunding.
Finally, do not neglect the support systems for business creation, which certainly support your administrative procedures, an advisory dimension, and often financial assistance.
You can find a lot of advice on the different ways to raise the necessary financing or launch your store in our article on funding for business creation.
We hope this article has given you a better understanding of how to open leather goods. If there are any unclear points and you would like more information, please feel free to ask us your questions in the comments.
Ant Display is a professional commercial furniture manufacturer for over 18 years; we custom design and build shopfitting for handbag stores, shoe stores, and clothing retail shops. Whether you need a banquette shop furniture or handbag retail kiosk in the mall, you will find the best work here at the most attractive price.