How to open a building materials store from scratch: a business plan. We build a business and houses, or how to open an Okved building materials store to trade building materials
* Calculations use average data for Russia
1 220 000 ₽
Starting investments
473 000 ₽
133 000 ₽
Net profit
18 months
Payback period
Opening a building materials store means starting a profitable business that is in demand at any time. By investing about 1 million rubles, you can earn 150 thousand rubles a month.
“Repairs cannot be completed, they can only be suspended” - worldly wisdom indicates one of the reasons why it is worth opening a hardware store. There will always be a demand for building materials: while some are building, others are repairing and vice versa. Development construction market in Russia contributes to the fact that they build and repair a lot. Even if the housing does not need to be repaired, nails, a hammer, a screwdriver and so on will come in handy in everyday life. Therefore, opening a hardware store from scratch is great idea for profitable business. To figure out how to start a business and how much it will cost, we offer a detailed guide that will answer the basic questions of a novice entrepreneur.
1. Market overview
The dynamic development of the construction industry and the real estate market in Russia contributed to the growth in demand for building materials. This was accompanied by the emergence of new retail outlets - from small pavilions to building hypermarkets. Market annually building materials increased by 20%.
Today, there are more than a thousand universal and specialized chains of hardware stores on the market, while the top 10 largest retailers account for almost 25% of the market. The crisis of 2014-2015 consolidated the success of large hardware stores. The growth of competition in the market and the regional leadership of large market players led to the fact that other construction stores faced problems: a decrease in sales and, as a result, a deterioration in their financial condition.
The difficulty of competing with construction hypermarkets lies in their aggressive pricing policy and a wide range of products covering all stages of construction and repair. When planning a purchase, a potential client tends to choose a large shopping center. There are many reasons. This is the breadth of the range, lower prices, the ability to buy everything you need in one outlet, service (consultations, delivery services, etc.).
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However, there are situations in which the buyer will rather go to a small hardware store. This is the purchase of a small amount of building materials for cosmetic repairs, the addition of materials that ended during the repair, minor household issues that require urgent solutions. In this regard, since 2015 among building stores there has been a tendency to change the structure of the assortment with the replacement of building materials with household goods.
The defining moment in this area of trade is the advantageous location of the store. While large retail outlets occupying vast areas are forced to be located on the outskirts of the city, small hardware stores can open in a residential building, mall or at the local market. Therefore, despite the high level of competition in the building materials market, this direction can become profitable business. The main thing is to correctly choose a place and plan all stages of opening a retail outlet.
Thus, a hardware store as a business has its advantages and disadvantages. The main advantage is the high demand for the product, which guarantees a stable income. According to statistics, the average family in Russia makes repairs every 5-7 years. This does not include purchases to maintain repairs. The profitability of a hardware store can be 30-32%, depending on the margin on goods.
Difficulties in the business of selling building materials:
Fierce competition in the industry. The market will have to compete not only with small retail outlets, but also with construction hypermarkets, which can offer the consumer a wide range and lower prices;
Price policy. It is necessary to set the optimal price for goods, since inflated prices will scare away potential customers, and too low prices will not allow the business to recoup. The best option is to analyze the pricing policy of competitors and reduce prices by 2%;
The need to provide a wide range of products to interest the consumer. Firstly, there is an important task to correctly form the assortment, taking into account the preferences of the target audience. Secondly, there is a need to establish contacts with a large number of suppliers and choose the most suitable ones;
Seasonality of sales. Statistics show that the peak of retail sales is recorded in the spring and autumn months, summer sales are 70-80%, and winter - 50-60% of the maximum. Moreover, seasonality is also noted for individual commodity items, which is why a wide assortment of a hardware store is important.
2. Store format and assortment
As mentioned above, it is more rational for a novice entrepreneur to open a store in the “neighborhood” format. Its scale can also be different: from a small pavilion with building materials to a supermarket. It all depends on the chosen place for trading and financial opportunities. We will look at how to open a hardware store, using the example of a small supermarket offering customers more than 100 items of goods.
For a store of this sales format, you should rely on consumables used in repair work (fasteners, paints and varnishes, adhesives, construction tools). Based on the format of the store, its assortment is determined, which should include the following categories of goods:
paint and varnish products (paints for interior and exterior works, primers, impregnations, varnishes and coatings for various materials, as well as rollers, brushes);
building mixtures, cement, primer, putty, alabaster, etc.;
mounting foam, sealant, liquid nails, mounting glue;
hardware of various modifications and sizes, nails, screws,
wallpaper. This group goods should be represented by a wide range to satisfy the tastes and requirements of different consumers. Related products include adhesives, brushes, etc.;
floor coverings (laminate, linoleum, carpet, parquet and related products in the form of fasteners, underlays, skirting boards, etc.);
construction tools (rollers, spatulas, hammers, nail pullers, drills, screwdrivers, etc.).
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Before forming the assortment, a thorough analysis of the market, suppliers and assortment of competing stores should be carried out. This will allow you to determine consumer demand and select products in such a way as to create a unique offer in the market. Important! You will be of the greatest interest to the buyer in two cases: if you can offer a unique product that is not on the market, or the same one, but at a more attractive price. The fact of proximity to the house is also significant, however, since building materials do not belong to spontaneous purchases so don't rely on that alone.
The main recommendations for the formation of the assortment of a hardware store:
it is desirable that each group of goods be represented by several manufacturers in different price categories. At the same time, goods of the middle price segment should be at least 60% of the entire range;
choose trusted, high-quality suppliers, since the reputation of the store depends on this;
when choosing suppliers, also pay attention to whether they are presented in other stores. Unique offers in the market will attract buyers;
if a product is not in demand, its stocks should be reduced, but not completely excluded from the assortment.
It is also proposed that the store operate in a self-service format. As practice shows, such a system contributes to the growth of sales. For this format, the goods should be divided into categories for convenience. A consultant is provided for each department (or related departments).
Advantages of a hardware store operating in the mini-market format:
convenient location for clients. Construction stores located within walking distance, in certain cases, are the most attractive option than hypermarkets remote from the city;
range variability. The area and format of the store allow us to offer a wider range of products than in construction pavilions. Not only products of popular manufacturers, but also less common brands can be presented here. Construction hypermarkets usually work with certain brands and are not inclined to change suppliers. Smaller stores are more flexible and can work with a wide range of suppliers.
customer loyalty system. At the moment, not many hardware stores pay attention to customer acquisition policies. You can correct this mistake and provide, for example, a system of discounts for regular customers.
3. Choice of location and premises
As with any retail establishment, the location of a hardware store is important. Favorable location determines 70% of the success of the outlet. The assessment of the location of the store takes into account such parameters as the characteristics of the area, the ease of parking, the intensity of the pedestrian flow, visibility and noteworthiness, and proximity to similar enterprises. good option will be the area of new buildings, as well as sleeping areas remote from large hardware stores.
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When choosing a premises for a store, the question arises: to rent a retail space or to acquire it as a property? Entrepreneurs recommend not to hurry with the purchase of retail space and work in the rented premises for the first two years. In case you make a mistake with the choice of a retail outlet or things don’t work out, it will be much easier to simply free up the rented area.
Requirements for the premises of a hardware store:
The required store area is at least 100 sq. m. Otherwise, there is a risk that the store will be unprofitable.
The trading floor should be square or rectangular in shape, without unnecessary bends - this will make it easier to place shop windows and make the most efficient use of the available space.
Ceiling height must be at least 2.7 m.
From the trading floor there should be two entrances - for visitors and for loading goods. With a sales area of 100-150 sq. m. for warehouse 50-70 sq.m. will be required.
The presence of heating, ventilation, air conditioning, plumbing, sewerage, ventilation and electricity in the room.
Special investments in the repair of premises for a hardware store will not be required. Enough to fit the room sanitary requirements was dry, clean and well lit. Rent commercial premises with a total area of 150 sq.m. on average, it costs about 100,000 rubles a month. When dividing the leased area into premises for various purposes, 100 sq.m. on the trading floor, 40 sq.m. for a warehouse and 10 sq.m. for technical rooms.
4. Equipment of the sales area
The retail space should be well lit. The interior for a hardware store is quite simple and does not require large investments. However, when planning the budget for the project, you should include the cost of repairs. One way or another, some minimal alteration of the rented premises will be required. For this type of expenses, plan at least 20,000 rubles.
When preparing a trading and storage area, there is no need for expensive finishing materials. The finished room should be bright, clean and dry. Make inexpensive cosmetic repairs and take care of good ventilation. This is all that is required from the premises for successful sales your enterprise. The technical equipment of a hardware store should contribute to the growth of sales, ensure the productivity and payback of trade and comply with safety regulations. In this regard, the trading floor must be provided with reliable lighting and ventilation equipment.
In addition, you should purchase commercial equipment - racks, showcases, cash counter, cash register. Since the store operates in a self-service format, several racks will be required on which the goods will be placed. For initial stage The store has two cash registers. However, it is necessary to zone the trading space so that, if necessary, one more cash desk can be placed.
Equipment costs
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Wall rack |
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Island rack |
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Cash counter |
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POS system with cash register |
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Security and fire alarm |
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Baskets and trolleys (including cargo) |
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5. Search for suppliers and purchase of goods
Suppliers should be sought in person, visiting the city's wholesale depots, or via the Internet. The first method is convenient because in a personal conversation it is easier to agree on partnership conditions; the second is that you can save on transportation costs, cover a wide range of potential partners, find more profitable terms and conclude contracts with suppliers not represented in the local market. It is recommended to use a mixed way of working with suppliers: buy some of the goods immediately, and take some for sale.
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Having decided on the suppliers, it is necessary to purchase goods for the store. Practice shows that for an average hardware store, the formation of the initial assortment will require 500-700 thousand rubles. Based on the specifics of demand and the conditions of suppliers, it will be necessary to purchase additional goods. The main thing in this matter is to correctly calculate the required volume of goods in order to diversify the assortment, but to avoid oversaturation of product shelves.
6. Recruitment
The main staff in the store are sales assistants. It is on them that the success of trading largely depends. For a store with an area of 100 sq.m. four sales assistants, three cashiers and one manager will be enough. Requirements for sales consultants: knowledge of construction products, the ability to unobtrusively offer their help and win over the client, organization, responsibility, courtesy.
Since the hardware store is open seven days a week and is open for 12 hours: from 9:00 to 21:00, a shift schedule for staff should be provided. It is recommended that two sales assistants and a cashier work on each shift. Sales consultants are interchangeable staff and can provide assistance to each other if necessary. The functions of a manager and accountant can be delegated to employees, or assigned to the entrepreneur himself, which will save money in the first months of work.
In the future, it is recommended to introduce a separate position - a procurement manager. His responsibilities will include working with suppliers, forming an assortment of goods, drawing up a logistics chain for the delivery of goods, and developing a pricing strategy. Before starting work, the staff must be trained, having familiarized themselves with the range of products, their characteristics and sales technology.
In this example, the entrepreneur performs the main functions of a manager - goes through all registration procedures, recruits personnel, negotiates with landlords and suppliers, purchases goods, and is engaged in the strategic promotion of the store. The manager organizes the work process, controls the work of sellers, carries out the acceptance and recalculation of goods and draws up the relevant documentation.
The preparatory stage will take about two months, during which registration procedures are envisaged, establishing partnerships with suppliers, finding suitable premises, recruiting staff, purchasing equipment and goods.
7. Advertising and promotion of a building materials store
The target audience of the hardware store is retail buyers, 60% of which are the male population of the city aged 23 to 65 years. Another group of consumers are corporate clients represented by construction and installation teams with whom contracts are concluded and work is carried out on the billing system.
Advertising of a hardware store can be divided into two types - passive and active. Passive advertising includes signs, banners, pavement signs, etc. Active advertising involves the distribution of leaflets, distribution of business cards, articles in specialized publications, advertising on radio and television. Another effective advertising tool is cooperation with repair and construction companies and teams. They will bring customers to the store and buy building materials, and the seller will give a percentage of the sales of attracted customers.
Since the competition in the segment is quite high, it is necessary to carefully consider the advertising strategy. The most effective forms of advertising for this store format are advertising in elevators, distribution of leaflets, placement of a bright sign. It is important to note that the sign must be located on the facade of the store building and be clearly visible from the road when moving in any direction.
Competent registration of a trading floor is an important element of marketing strategy. It is necessary to provide convenient navigation in the store and place the goods in such a way that each position is visible to the buyer. Marketers have long established that the correct display of goods in stores largely generates demand and allows you to increase sales by 10-15%. Particularly important is the placement of products such as wallpaper, flooring and other finishing materials.
Basic merchandising rules for hardware stores:
classification of the placement of the entire presented range of products; separation of large and small-sized goods;
competent placement of product groups on the trading floor in accordance with the locations of the main customer flows;
bulky goods should be placed around the perimeter of the store to improve the visibility of the trading floor. If the area of the store allows, then the goods are located on the lower shelves under the demonstration sample. If the area of the store is limited, then the issuance of large-sized products is carried out at the warehouse with the assistance of a sales assistant;
goods of small dimensions are placed according to their classification and are presented in several copies, which attracts the attention of the buyer. For the layout of such goods, racks with hooks and fasteners are used. Small, vulnerable goods are located in an area with good overview;
the main volume of finishing materials requires a special layout on special equipment: a showcase for wallpaper with rollers, demonstration stands. The most convenient grouping of wallpapers - by color scheme;
in the checkout area there is small-piece goods, consumer goods and related products;
broadcast of accompanying information, allowing buyers to navigate the trading floor;
efficient placement sales consultants.
Thus, start-up costs advertising campaign will amount to 72,000 rubles. It will take an average of 3 to 6 months to promote the store and reach the desired sales volumes - during this time, buyers have time to get to know and get used to the new outlet.
8. Business registration
For reference retail building materials do not require any special permits. To open a hardware store from scratch, you will need to collect a package of documents, which includes a sanitary and epidemiological conclusion from Rospotrebnadzor, permission from the fire inspectorate, regulations to the store. It will also require contracts for the removal of solid waste, disinfestation and deratization of the premises.
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For reference commercial activities you can register an LLC or an individual entrepreneur with a simplified taxation system (“income minus expenses” at a rate of 15%). The choice between an individual entrepreneur and an LLC will depend, first of all, on the scope of the future business. If you plan to open one small store, then IP will be enough. If you plan to open a large construction supermarket or a chain of stores, it is better to register an LLC. In this case, you need to select the type of activity according to the OKVED-2 classifier: 47.52 Retail trade in hardware, paints and varnishes and glass in specialized stores.
9. Cost planning
When planning expenses, they should be divided into three groups: initial investments, variable and fixed costs. And now in order.
Initial investment - the amount that is required to open a business. This includes all costs incurred in the early stages of the project, from the cost of finding premises to the purchase of equipment and goods. The initial investment according to our example will amount to 1,220,000 rubles. Please note that to the initial investment added working capital, which will be spent on proving the purchase of goods and covering expenses in the first months of work.
Initial Costs
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Rent for 1 month |
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Premises renovation |
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Business registration, obtaining permits |
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Purchase of goods |
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working capital |
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Variable costs consist of the cost of acquiring goods, including shipping. Fixed expenses consist of rent, utility bills, fund wages, advertising expenses, taxes and depreciation charges.
fixed costs
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Rent |
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payroll with deductions |
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Taxes (average) |
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10. Calculation of revenue and profit
When planning sales volume, some seasonality should be taken into account construction business- the peak of sales falls on the spring and autumn months, and the fall in sales - in the winter. The planned sales volume is calculated based on the average check amount of 3,000 rubles and the number of customers - 400 people per month. With these parameters, the average revenue will be 1,200,000 rubles per month. You can reach the declared sales volume in the fifth month of the store's operation, taking into account the seasonality of the business.
How much can a hardware store earn
We consider, based on the volume of revenue, a markup on building materials of 65% and all expenses indicated in the tables above.
Gross profit (revenue-cost): 1,200,000 -727,000 = 473,000 (rubles)
Profit before tax: 473,000 - 269,000 = 204,000 (rubles)
Net profit: 204,000 - (473,000 * 0.15) = 133,050 (rubles)
Of course, in the first months of work you should not expect such a profit, however, when you reach the planned sales volume, you can earn about 130 thousand rubles. per month. In this case, it will be possible to recoup the initial investment in 1.5 years after the start. Please note that the above calculations are approximate. To get started successful business, it is necessary to develop a business plan for opening a hardware store. This will allow assessing the prospects for the development of such a business in a particular region, taking into account the nuances of a particular project and competently planning each stage of implementation.
11. Risks
When planning a business, it is also worth considering the risks that an entrepreneur may face at different stages of the project. Its specificity determines the following risks of activity:
increase in purchase prices for goods, unscrupulous suppliers. In the first case, there is a risk of increasing costs and, as a result, the selling price, which may negatively affect demand. In the second case, the risk is associated with interruptions in the trading process due to a lack of goods. It is possible to reduce the likelihood of these threats with a competent choice of suppliers and the inclusion in the contract of all necessary conditions which provide liability supplier in case of their violation;
insufficient level of demand. Firstly, the demand for building materials has a pronounced seasonality; secondly, it is closely interconnected with the economic situation in the country. In this regard, the risk of a low level of demand is one of the most probable and may arise both due to low solvency of demand, and due to high distribution costs. It is possible to reduce the risk with careful planning of the store's activities and financial results, competent choice of retail space, holding various promotions and discounts, stimulating repeat purchases, flexible pricing;
competitor reaction. Since the market for building materials is quite saturated and the competition is high, the behavior of competitors can have a strong influence. To minimize it, you need to create your own client base, constant monitoring of the market, the presence of a customer loyalty program and the formation of competitive advantages;
property risks. This category includes risks associated with damage and theft of goods. The self-service system increases the likelihood of this risk occurring. Minimizing the threat will allow the sales assistant to check the goods that enter the store, control the situation on the trading floor;
Refusal to provide rental premises or increase the cost of rent. Since location is one of the most important parameters for trading, the loss of a place threatens with big losses. To reduce this risk, it is necessary to conclude a long-term lease and carefully choose the landlord;
problems with staffwhich means low qualification, staff turnover, lack of motivation of employees. The easiest way to reduce this risk is at the stage of recruitment, hiring employees who meet all the requirements. It is also worth considering bonus motivation for employees;
decrease in the store's reputation among the target audience due to errors in management or a decrease in the quality of services. It is possible to level the risk with constant monitoring of the quality of goods and services, obtaining feedback from store customers and taking corrective action.
SUMMARY
Like any business, a hardware store has its advantages and disadvantages. The main advantage is the high demand for building materials. It is provided not only by those consumers who make repairs in new buildings, but also by residents who carry out repeated repairs. This means that one consumer repeatedly visits the hardware store, which ensures sales. Therefore, there are a lot of potential buyers at the hardware store.
The negative point is the high competition in the market. It is especially difficult for small hardware stores to survive in the fight against chain hypermarkets. However, even under such conditions, you can find your niche. A well-chosen assortment, active advertising, advantageous location and loyalty to customers will help in this.
If you manage to win over your consumer, then the store can start profitable work in 3-4 months after opening, and the initial investment will pay off in 1-1.5 years. A building materials store is able to earn about 1.5 million rubles. per year and become promising business who has room to grow.
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OKVED table for retail trade in 2020
OKVED in this industry allows you to regulate the activities of official organizations of various sizes: specialized and non-specialized stores, kiosks, stalls, tents, as well as home sales, handing over goods in person, Express delivery, delivery services by mail and so on.
- Classification of organizations, private and individual enterprises and firms of any organizational and legal form according to the type of their activity.
- Assigning a separate code to each type of activity.
- regulation of this activity.
- Company surveillance.
- Access to the international level.
- Informing higher authorities.
47 Retail trade, except for motor vehicles and motorcycles
- resale (sale without conversion) of new and used goods for personal or household use, or use by shops, department stores, stalls, postal businesses, door-to-door deliveries, merchants, consumer cooperatives etc. Retail trade is classified primarily by type trade enterprises(retail sale in department stores - groupings 47.1 to 47.7, retail sale outside stores - groupings 47.8 to 47.9). Retail trade in stores of a general assortment of goods includes: retail sales of used goods (group 47.79). For retail sales in department stores, a further distinction is made between retail sales in specialized stores (groups 47.2 to 47.7) and retail sales in non-specialized stores (group 47.1). The above groupings are further subdivided according to the range of products sold. Sales other than general-purpose stores are classified according to the form of trade, such as retail sales in stalls and markets (group 47.8) and other retail sales not through department stores, for example, trade by mail, with through delivery of goods, through vending machines etc. (Group 47.9). The range of goods in this grouping is limited to goods commonly referred to as consumer goods or retail goods. Therefore, goods not normally sold in retail trade, such as cereal grains, ores, industrial equipment etc. not included in this group
- retail sale of goods such as personal computers, stationery, paints or wood, although these products may not be applicable for personal or household purposes. Traditional processing of goods in trade does not affect the essential characteristics of goods and may include, for example, only their sorting, separating, mixing and packaging.
Okvad Retail 2020
Food products can be sold at retail not only in stores specially designed for this purpose. A wide range of outlets and sales outside stores provide for the possibility of selling food products in compliance with general requirements about consumer information. Such goods are allowed to be packaged, re-sorted, batches are changed, and other actions that are not transformations are allowed.
Why does the company, in fact, need the OKVED code? Firstly, it is necessary in terms of collecting statistical data. – this makes it easier for Rosstat to know how many organizations in the country are involved in one or another entrepreneurial activity. Secondly, OKVED is necessary for the correct taxation of certain organizations: depending on the type economic activity companies use certain taxation systems. That is, a notary's office cannot be subject to a single tax on imputed income, and gold mining – be on USN.
Retail Okvad
Retail sale of merchandise such as personal computers, stationery, paint, or wood, although these products may not be applicable for personal or household use. Traditional processing of goods in trade does not affect the essential characteristics of goods and may include, for example, only their sorting, separating, mixing and packaging.
Resale (sale without conversion) of new and used goods for personal or household use, or use by shops, department stores, stalls, postal companies, door-to-door deliveries, merchants, consumer cooperatives, etc. . Retail trade is classified primarily by type of trade enterprises (retail trade in department stores - groupings from 47.1 to 47.7, retail trade outside stores - groupings from 47.8 to 47.9). Retail trade in stores of a general assortment of goods includes: retail sales of used goods (group 47.79). For retail sales in department stores, a further distinction is made between retail sales in specialized stores (groups 47.2 to 47.7) and retail sales in non-specialized stores (group 47.1). The above groupings are further subdivided according to the range of products sold. Sales other than general stores are subdivided according to the form of trade, such as retail sales in stalls and markets (class 47.8) and other retail sales not through general stores, such as mail order, door-to-door, vending machines, etc. d. (Group 47.9). The range of goods in this grouping is limited to goods commonly referred to as consumer goods or retail goods. Therefore, goods not normally sold in retail trade, such as cereal grains, ores, industrial equipment, etc. not included in this group
OKVED classifier for individual entrepreneurs and LLC for 2020
- (65.2) Other financial intermediation
- (65.21) Financial leasing
- (65.22) Provision of credit
- And others 65.2X
- (66.0) Insurance
- (66.02) Non-state pension provision
- (67.12) Exchange transactions with stock values
- (67.12) Exchange operations with stock assets Natalya / v
- when filling out an application for registration of an individual entrepreneur or LLC, it is necessary to indicate the codes of the economic activity that the organization will be engaged in. Moreover, there may be several codes (according to the law, the number of OKVED codes indicated is not limited), but it is imperative to indicate the main type of activity by indicating the appropriate code. The main type of activity affects the calculation of the amount of contributions paid to the insurance and pension funds;
- OKVED codes are found in regulatory and legal documents related to the regulation of certain economic types activities;
- in the state statistical register, which records the types of activities and regulates the development of economic processes;
- in other documents of the state and international level related to the maintenance of statistics and the storage of information on types of economic activity.
What are the OKVED codes for individual entrepreneurs for food retail in 2020
It is certainly impossible to imagine a specialized grocery store without such goods as bread. It is the most sought after among all categories of the population, so it can be found at any point of sale of food products. This should include the following subclasses and activities provided by the classifier:
- 47.29.11 - sale of fresh milk and dairy products;
- 47.29.12 - trade in poultry eggs;
- 47.29.21 - sale of animal oils and fats used for food;
- 47.29.22 - sale of oils of vegetable origin, spreads;
- 47.29.31 - sale of flour and pasta;
- 47.29.32 - sale of cereals;
- 47.29.33 - trade in sugar;
- 47.29.34 - trade in salt;
- 47.29.35 - retail sales of cocoa, coffee, tea and other similar drinks;
- 47.29.36 - sale of homogenized food products, as well as dietary, sports and baby food.
OKVED: retail and wholesale trade
Licensing depends on the specified code, tax incentives, tariff on premiums for injuries. Also, new codes are a necessary “requisite” for accounting and tax reporting. At the same time, the legislation does not limit the choice of the number of activities. The main rule is the presence of at least one code that will characterize the main type of trade that the company conducts.
Starting from January 1, 2020, tax authorities and companies, including wholesale and retail trade organizations, switched to the new Classification of Economic Activities OK 029-2014. The directory was approved by Rosstandart by its order dated January 31, 2014 No. 14-st. True, the codes have changed a long time ago, but they were officially allowed to be used only this year.
Retail sale of building materials OKVED
The latest edition of the classification handbook is more detailed. Current OKVED #8212; , the trade in building materials in which is in section G under the numbers 51 and 52. Wholesale, own forces, through agents and retail are collected in various subgroups. In them, the types of products sold are distributed in even more detail. It:
The types of economic functioning of enterprises are grouped according to individual characteristics, such as belonging to an industry, production methods, and others. The OKVED code (trade in building materials, for example) is assigned in accordance with the Russian codifier for types of economic activity and has at least four digits. The first two are the main group (in this case, “Wholesale and retail sales”), the next ones are more specific (for example, “Retail sales of paint and varnish products”).
OKVED: retail sale of non-food products
Checks can serve as protection for both the client and the seller. In case of occurrence conflict situations(detected shortage, discrepancy between the price in the check declared), each of the parties keeps a proof of correctness. And in court cases that arise at the initiative of customers, a check is the only way for a store to prove its case and maintain its image.
45 grouping includes activities that are related to the sale, as well as the repair of cars or motorcycles. 46 and 47 include all activities that are related to sales. The main difference between 46 and 47 (wholesale and retail j) is based on the predominance of a specific type of buyer in each group.
05 Aug 2018 1100A hardware store is a promising type of business with a payback period of 12-15 months. with a profitability of ~20%. The construction market in Russia annually develops at a moderate rate of 7-15%, this is due to an increase in the number of new real estate put into operation, capital and summer cottage construction. The direction of development of the construction industry is strongly influenced by the policy of the state and financial condition. During crises, the purchasing power of the population falls, which leads to a decrease in real estate purchases and a decrease in sales of materials for construction stores. In the article, we will analyze how to open a building materials store from scratch.
Advantages and disadvantages of opening a hardware store
Main the target audience hardware store: builders and foremen. Consider the key advantages and disadvantages of creating a clothing store.
| Advantages | Flaws |
| High profitability of the business and its payback within 12-15 months. | High competition in this segment due to the high profitability of the niche. ~80% occupied by chain stores |
| "Hot Niche". High demand for building materials and equipment | The need to provide a wide range of products |
| Moderate initial investment when opening a franchise store ~ 900,000 rubles. + consulting support franchisee | Influence of seasonality on sales volume: decrease by 50-60% in winter. |
About 80% of the entire construction market is divided between large grid companies (according to ABARUS Market Research). There is a trend towards a decrease in the number of retail construction and hardware stores and their displacement by chain stores. Small stores cannot provide a wide range of products or low prices (as in Leroy Merlen, for example), their only competitive advantage may be the proximity of the location to objects under construction, residential complexes, cottage settlements, etc. Building materials are best sold in the spring and in the period September-October. In summer, sales are reduced to 70-80%, and in winter to 50-60%.
How to open a building materials store: main types
To open a hardware store, you need to determine its type and the necessary initial investment.
| Shop types | Peculiarities |
| Small shops (60-90 m²) | Engaged in retail sales. They are characterized by a small narrowly focused assortment: 100-250 items of goods. To open a store you need ~$9000-14000. |
| Medium size stores (200-250 m²) | They offer a wider assortment: 4000-6000 items. Satisfy the needs of consumers who buy not only the essentials, but also decorative elements and related materials. The opening will cost $40,000-60,000. |
| Supermarkets (from 1000 m²) | A wide range of products: 10,000-15,000 items. Except retail space, supermarkets have their own warehouses, which facilitates the demonstration of goods and subsequent delivery to the consumer. Opening costs: ~250000-350000$. Investments or additional partners are needed. |
| Store-warehouse (small wholesale base) | Differs in a narrow assortment in comparison with a supermarket. Items for sale that do not need to be shown. Benefits of a store-warehouse minimal requirements for finishing the premises. Well-known and widely used products are sold. Profit is achieved by increasing the volume of sales, tk. the markup on goods is minimal. Opening a warehouse store will require large storage areas. |
How to choose store locations
To choose, you must first appreciate the environment of the future store. Since the store is an offline business, close proximity to new buildings, residential complexes, construction markets, and busy highways will be a key success factor. There are no strict requirements for the premises for a hardware store, an important condition is the availability of parking spaces for customers' cars. There is no need for a special aesthetic appeal of the room - everything should be extremely functional. Optimal area there will be a store >200 m2, smaller stores are not profitable due to the small breadth of the assortment. The room must be provided with ventilation and compliance with fire regulations. To open a small shop, it is recommended to have your own premises, if the premises are larger than 500 m2, it is more profitable to rent it.
One of the advantages of opening a hardware store on a franchise is its belonging to the network, regular suppliers and a wide range of products, technical and information support for the franchisee, debugging of business processes, staff training (communication scripts). The average cost of a franchise is ~350,000 rubles.
Supermarkets and small wholesale bases are usually located outside the city limits, since it is difficult to find such premises in the center. The place is chosen with convenient transport interchanges, but in a non-residential fund, in order to avoid problems with the fire department. For a super-large object, it is advisable to provide for a railway connection.
Search for partners and suppliers
One of the difficulties of opening a hardware store from scratch is finding and working with suppliers, many suppliers require prepayment for goods and materials. If you establish yourself as a reliable counterparty, then you can agree on preferential terms of delivery, supplying goods for sale without prepayment. These conditions release additional cash for business development.
Some building materials/equipment are more profitable to order in China. To search for Chinese suppliers, you can use major international portals, supplier aggregators: Aliexpress.com, Taobao.com. It is not necessary to know Chinese / English, there are many intermediary firms in the Russian Federation that can deliver them from these sites.
Product range
Without a properly selected assortment, the profitability of a building materials store will be low. A simple strategy would be to copy the assortment of successful competitors.
- If you open a small store that is not a representative famous brand, then focus on the mass buyer. Sell inexpensive tools and materials in a wide range. Despite the low prices, the goods must be of high quality.
- Distributors cannot independently set the cost of goods, because all prices are strictly regulated. The advantages of a distributor are the support of large suppliers and manufacturers: the provision of benefits and discounts when providing goods.
- Medium and large stores building materials sell goods of different price segments: expensive and cheap. This combination allows you to increase profitability.
If there is not enough demand for a certain product, do not abandon it completely. For trade in construction goods, the breadth of the assortment is important, many buyers make complex purchases to solve various construction problems.
How to open a hardware store: business registration
To open a hardware store, you must register with the local tax office in one of the legal forms of doing business: individual entrepreneur(IP) or LLC. The table below summarizes the main registration steps, the benefits of the form, and required list documents. When registering a business, you must select the type of activity according to the OKVED classification codes. This is an important procedure, approach it responsibly, not indicating the type of activity and not paying taxes will lead to litigation. OKVED codes for a hardware store:
52.46 - (for a shop of paints and varnishes); 52.46.1- "Retail sale of hardware"; 52.46.2 - (for a store of paints, varnish and enamels); 52.46.3 - (glazing materials store); 52.46.4 - (shop selling equipment for crafts); 52.46.5 - (shop of sanitary equipment); 52.46.6 - (horticultural equipment and supplies store); 52.46.7 - "Retail sale of building materials not included in other groups"; 52.46.71 - (timber trade); 52.46.72 - (sale of bricks); 52.46.73 - (sale of metal and non-metal structures). If you intend to trade through an online store, then the OKVED code is suitable: 52.61.2 - “Retail trade through teleshops and computer networks(electronic commerce, including the Internet).
| Form of business organization | Benefits of using | Documents for registration |
| IP ( individual entrepreneur) | It is used to open a small hardware store (up to 200 m²). Number of staff 1-2 people |
|
| OOO ( limited liability company) | Used to open a hardware store (>200m²). LLC is more profitable for attracting additional financing/loans, partners and scaling |
In law authorized capital LLC cannot be less than 10,000 rubles! |
The best choice of a preferential taxation system for a hardware store would be UTII(single tax on imputed income), to switch to this system a municipal law on the possibility of applying UTII at the location of the store should be adopted. There are conditions for the transition to UTII: up to 100 employees and the cost of fixed assets up to 100 million rubles. The interest rate on UTII is 15%. The advantage of this tax is its linkage to the physical data of the store: area, number of employees, etc. When opening a small store, this is beneficial.
If in your region it is not possible to switch to UTII, then an entrepreneur or organization it is optimal to choose the simplified taxation system (simplified taxation system) income minus expenses with an interest rate of 15%.
When registering a business, you must immediately apply for the transition to a preferential taxation regime (UTII or STS), otherwise the next opportunity to apply will arise only at the end of the current calendar year.
Necessary documents for the operation of the store
Below is a list of all required documents for shop operation:
- documents from firefighters and SES;
- copy of certificate of state registration with the signature of the head and the seal of the enterprise;
- a copy of the lease agreement or certificate of ownership of warehouse and retail premises;
- reference tax service on registration;
- certificate of operation with the signature of the head;
- a document confirming the level of education and qualifications of the head.
Advertising
For offline business, location is important - it is the best advertisement and the opportunity to get potential customers. If there is no traffic of visitors, then the place of the store is probably unsuccessfully chosen. Additional advertising can be use contextual advertising Yandex or Google. This allows you to attract target buyers to the website of the online store (or landing page).
Store staff
The main staff of the store are sales consultants. When hiring employees, you must have construction experience > 3 years. To reduce the cost of searching through recruiting agencies, you can use free bulletin boards avito.ru, irr.ru or thematic forums. Initially, the seller may be the entrepreneur himself. To increase the number of sales, it is necessary to conduct continuous training of sales personnel, develop selling scripts and introduce a system to encourage the seller when fulfilling the sales plan.
Comparison of wholesale and retail trade
The table below compares wholesale and retail.
| Wholesale | Retail |
| In wholesale trade, you work with a narrow circle of customers (B2B). Interaction is carried out under long-term contracts - the shipment of goods is regular. | In retail, you work with various private buyers who are pushing (B2C). Usually, buyers cannot evaluate the properties and benefits of materials themselves. There will be a need for staff able to ascertain customer requirements and recommend an acceptable purchase option. |
| The main difficulty is the conclusion of contracts with contractors and business on supplies, high responsibility. | The main difficulty is in the constant creation of traffic of visitors to the store. |
Rating of business success factors
- Store location.
- Sellers Qualification. The desire to work towards the end result.
- Trust of suppliers of goods, deferred payments and discounts provided by them.
- Warehouse and store area.
- Advertising support of the point of sale.
- Proper organization of the work of the outlet and the exposition of goods.
Evaluation of the attractiveness of a business by a magazine site
| Business Profitability |  (4.0 out of 5) |
Business Attractiveness
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| Project payback | (4.0 out of 5) |
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| Ease of starting a business | (3.0 out of 5)
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| A building materials store requires moderate initial costs ~ 900,000 rubles. (if the store is franchised). At independent discovery costs will increase by paid stocks of materials and equipment from suppliers and will amount to ~ 2 million rubles. key factor The success of the store is its location close to new buildings, residential complexes, construction sites. Payback of business ~12 months. Sales growth is carried out through the introduction of continuous training of personnel in sales and a system of encouragement and motivation in the implementation of the sales plan. Business requires expert knowledge in installation, construction, finishing work - this will help orient buyers and select goods for solving their problems. | ||
- Capital investments: 800 000 rubles,
- Average monthly revenue: 450 000 rubles,
- Net profit: 65,414 rubles,
- Payback: 12.3 months!
According to a study conducted by ABARUS Market Research, the Russian building materials retail market, compared to the Western market, is at an early stage of development. At the same time, the annual growth rate is 20%. In 2007, the volume of the retail trade in goods for home and repair was more than $14 billion in Russia. In 2011, the market volume amounted to about $17 billion, and by 2020 the market volume will be about $30-35 billion. (opinion of experts).
About 80-90% of the construction market is accounted for by large network companies(both Russian and foreign), and the rest of the market is divided among themselves by single stores, small retail chains(regional). Taking into account the fact that Russian market several new foreign players are planning to enter, as well as taking into account plans to expand existing federal chains, the market share of “single stores” will decrease.
In connection with the above, small shops cannot compete with federal retailers either in prices or in the range of products offered.
But if you want to start a business in the building materials retail segment, you can try to open a small outlet in "At home" format.
This type of store has the following advantages:
- Opportunity to open a store in an area where federal chains will not enter due to the impossibility of obtaining large turnovers.
- A special assortment of the presented goods and an individual approach to the buyer.
1. Organization of retail trade in building materials
1.1. room
The premises in which it is planned to open a retail hardware store in the neighborhood format must meet the following criteria:
- Area 30-50 sq.m.
- The premises should be located in a residential area, within walking distance for buyers.
- Lack of other stores selling building materials in the immediate vicinity.
1.2. Equipment
The choice of equipment can be approached quite freely, so to reduce the cost of purchasing equipment, part of the racks and shelves for goods can be made by hand, and part of the equipment can be bought second-hand
1.3. Staff
The store must work 7 days a week, working hours from 9.00 to 20.00 for these purposes, it is necessary that there are 2 sellers in the state. (work in shifts, two after two)
1.4. Range
During repairs, it often happens that there was not enough wallpaper glue, the metal hacksaw blade broke, there were not enough carnations, the glue got lost somewhere, the neighbor took the screwdriver and did not return it. The buyer is not interested in going to the construction hypermarket for such small things, he is ready to buy all this near the house, even at a higher price, in connection with this, all this should be presented in assortment.
Approximate assortment of the store:
- Expendable materials for tools
- Mounting glue
- Wallpaper glue
- Nails, dowels, bolts, etc.
- Construction tools
- other related product.
For optimal operation, the range of products sold should be about 300 positions.
1.5. Suppliers
The choice of suppliers must be made from those operating in the region wholesale companies. These companies themselves are engaged in the delivery of products to the store, with long-term work with them, it is possible to provide a deferral of payment.
Replenishment of inventory and assortment must be carried out on a weekly basis.
2. Feasibility studies
2.1. Capital cost of opening
To maintain the assortment and uninterrupted trade, inventory should be at least two monthly revenues (in purchase prices), and the optimal balance is 2.5-3 monthly revenues.
2.2. Revenue
The revenue of a small (up to 50 sq.m.) hardware store in the "At Home" format located in a densely populated residential area, with a well-chosen assortment, as well as in the absence of competitors in the near distance, is about 400-500 thousand rubles. per month.
For calculations of payback and profitability, the amount of monthly revenue was 400 thousand rubles.
2.3. Cost price
The markup on products sold is 50-80%, depending on the product, for calculations for the average markup of 60% was taken
2.4. General expenses
2.5. Calculation of the profitability of a building materials store
2.6. Payback calculation
3. Organizational moments
3.1. Organizational form
The optimal legal form is an individual entrepreneur.
3.2. Taxation system
OKVED is necessary for individual entrepreneurs when trade in building materials is organized. They make up a fairly large group.
It includes both wholesale and retail. Depending on what format of activity is used, the list of areas of work is also determined.
The selection of designations that best meet the IP's intentions is extremely important point and this matter must be taken as seriously as possible. The task is greatly complicated great amount names of goods and related services. For example, some shops sell, among other things, tools, while others provide home delivery of purchased goods to the buyer, and others install equipment or repair it.
For this reason, if you are not sure that you can handle the task on your own, it is better to turn to specialists. Their services are not that expensive.
Nuances
In the process of registration actions, an individual entrepreneur is obliged to independently indicate in the documents the codes related to his type of activity. It would be useful to also give the designations of related works - this will avoid the need to make changes to the EGRIP in the future.
You can select the appropriate codes using the OKVED 2 classifier or other sources. The law does not prohibit specifying any number of directions, however, it is mandatory to enter in the application one main code assigned to the type of activity through which you plan to extract at least 60 percent of the total income.
It should also be noted that only the first four digits of the code are indicated in the application for registration and in other documents being prepared. Do not bring others.
In addition, some types of business are subject to compulsory licensing, which means that doing it without having permits it is forbidden.
OKVED codes for wholesale trade in building materials
First of all, it is necessary to talk about wholesale trade- This type of activity has several codes.
For example, agency sales activities:
- wood products and building materials (46.13);
- universal range of specialized products (46.19).
Code 46.73 implies trading:
- timber;
- sanitary equipment;
- building materials.
Sale of hardware, equipment and accessories for heating and water supply - 46.74.
Non-specialized sales - 46.90.
Retail
Here the list of codes is much more extensive. In particular, retail sales through non-specialized stores of all product groups are designated as 47.19.
In other cases, when the goods are sold through specialized trading establishments, other data are indicated. The general subclass here is 47.52. In particular, when it comes to retail:
- hardware goods, then indicate 47.52.1;
- paint and varnish products - 47.52.2;
- sheet glass - 47.52.3;
- consumables and equipment necessary for their processing in the manufacture of handicrafts - 47.52.4;
- sanitary appliances - 47.52.5;
- machinery intended for working in a garden or vegetable garden, as well as inventory - 47.52.6;
- other building materials not included in other groups - 47.52.7;
- treated wood - 47.52.71;
- brick - 47.52.72;
- structures, both metallic and equally non-metallic - 47.52.73;
- prefabricated buildings made of wood (bathhouses, gazebos and garden toilets) - 47.52.74.
In general, retail trade organized in:
- specialized store, has a code - 47.78;
- tents and markets - 47.89;
- World Wide Web or by mail - 47.91;
Sales without a tent, outside the market or shop - 47.99.
If you intend to provide services for the delivery of purchased goods to your home, then you must specify the cargo transportation code - 49.41.
