Jan
22
2013

How Much Capital to Put-up a Grocery Store

Question:

I am planning to put up a mini-grocery store by June. I just want to know if my budget of P350-400K will be enough as start-up to purchase most common grocery items?

Answer:

The amount will depend on how big is your store area and how much variety you plan to carry. If you will be buying by the case, the average prices is around P500 for light items and about P1,000 for the more expensive ones. Given your budget, you can have 300-400 types of items which I think will give a wide enough variety for your customers to choose from.

Take into consideration the type of customers you will be serving so limit your variety particularly the sizes to their needs and what they can afford. If you are into the bigger families with bigger income, they may go for the bulk or big packs, but if the neighborhood is low income, you will have to go for the sachet and other small sizes.

If you can’t get directly from the manufacturer, get in touch with distributors who can deliver the goods to you and they may also offer discounts or credit terms. Your alternative would be wholesalers. Try checking out Suy Sing Commercial (www.suysing.com – though the site seems to have disappeared at the moment), they sometimes offer cheaper prices than the manufacturers and also delivers for a minimum amount (25k?), the only drawback is that you have to pay in cash.

One of the top products you can sell are cellphone cards and e-load service.

Keep your overhead low as these will kill the business if you don’t watch your cashflow.

Get a good accountant who keeps track of the government laws and regulations, both BIR and City government, as this will affect your tax filing and payments. If you miss out on one, you have to pay the penalties. Keep your records straight. This will save you a lot of headaches in the long run.

Good luck on your business.

The Manager
Purity Supermarket
www.purity.com.ph

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