How to Open a Shoe Store Business in California
- 1). Form your business entity. Once you have decided on a name for your shoe store, choose your structure, such as sole proprietorship, partnership, corporation or limited liability company. Create your documents using an online legal help service or an attorney, then file them with the California secretary of state's office.
- 2). Apply for your federal tax ID number from the Internal Revenue Service (IRS). This employer identification number (EIN) may be necessary whether or not you have employees. It is the number used to identify your business in the same way that a social security number is used by individuals. You will need it for licenses, permits and dealing with suppliers.
- 3). Obtain your business license from the local municipality where your shoe store will be located. File your fictitious name with your local county clerk's office.
- 4). Apply for a seller's permit at your local office of the California State Board of Equalization. This will establish your ability to buy shoes wholesale and sell at retail prices. This permit will also exempt you from paying sales tax on your purchases, though you will have to charge your customers tax and pay it back to the state of California.
- 5). Know what your competition carries and supply the inventory that the current market lacks. Attend shoe trade shows and join associations to find the style and trends that you want customers to identify with your store. Calculate the retail pricing for your inventory, subtract the total of your business expenses and determine if the shoes you want to carry will maintain a profit and volume that provide an adequate income as outlined in your business plan.
- 6). Request trade credit from your shoe suppliers. Finding wholesalers who have the best quality shoes at the lowest prices is an important factor to the success of your store. Trade credit will allow you to receive shoe orders without paying for them for a specified period of time, such as 30 days. Trade credit gives you an opportunity to sell the shoes before you have to pay for them, increasing your cash flow and keeping your company liquid.
- 7). Hire employees with prior retail experience and good employment references. Although it will be less expensive for you to operate the store yourself, you can lose potential sales by not having enough workers for adequate customer service during busy hours.
- 8). Review your business plan for the type of marketing that you will use for your grand opening. The way you introduce your shoe store to the community can establish your image branding for the future. Send coupon mailers to local residents, advertise with radio spots, ask surrounding businesses to place your flyers on their counters, post a banner in front of your store and plan to have inexpensive giveaways and entertainment at your event. Take advantage of online resources and social media to spread the word.
