How To Open A Brick and Mortar Supplement Store?
By the end of 2022, the size of the global dietary supplements market is estimated to be around $163.12 billion. This value is set to grow at a current annual growth rate (CAGR) of 8% and is anticipated to reach $350.96 billion by the end of 2032.[i] The Council of Responsible Nutrition (CRN) found that 75% of Americans are taking some form of dietary supplements; up from 65% in 2009. The consistent growth of nutritional supplements and vitamin sales is good news for anyone looking to enter this market.[ii]
To take advantage of this lucrative market, many supplement brand owners and those interested in the health and fitness sector have started opening brick and mortar supplement stores. If you are also interested in increasing your profits and benefiting from supplement sales, this article aims to walk you through the entire process of opening a supplement store.
Steps to Follow When Starting a Supplement Store
A supplement store typically sells dietary supplements, vitamins, protein powders, and other health-boosting foods for customers. These customers generally are looking to fulfill their day-to-day fitness, health, and nutritional needs. A supplement store is usually an independent store; however, they are usually present close to or within a grocery store. If you have decided that opening a supplement store is the way for you, here is your step-by-step guide to achieving this goal.
Plan your business
To be a successful store owner, it is essential that you do your homework and have a supplement store business plan set in place before you begin your journey. While we have done most of the research for you, having a clear plan helps you map out any specifics of the business and discover things you may have previously missed out on.[iii] It is also important to have a clear idea of the products you want to sell in your store. If you're going to keep it small and sell only dietary supplements, or if you want to go all out with a mix of nutritional supplements, whole foods, and boxed foods. You may also have to think about whether you want to start an independent business or if you find that a franchise would be a better fit for you.[iv]
Everything considered, you must also investigate how much it costs to open a supplement store. According to the website “How to Start An LLC” the cost of the equipment amounts to be around $4,000, signage fitting is estimated at $4,000 to $6,000, the cost of fixtures comes up to $50,000, with another $50,000 each on construction and opening inventory with a minimum of $2,000 on promotions, the total cost of opening a supplement store can be anywhere between 180,000 to $200,000 with an additional $40,000 if you decide to go the franchise route.[v]
Talking to professionals who have already started their own store or who help brands set up their store can also help make the planning process easier and more streamlined.
Form a legal entity
Once you have finished the business planning stage, the next step is to legalize it. Choosing the correct legal structure for your company. A legal entity can help you keep your personal and business finances separate. You can opt for a sole proprietor, a partnership, or a limited liability company or corporation. Whichever format you choose, your paperwork will need to be filed. We strongly encourage you to contact an attorney for advice on how to go about accomplishing this.
Choosing the right name for your business is another important step. A good name is the backbone of your business; you can visit the county clerk's office to register your store name as your DBA (Doing Business As). This also helps you determine if any other store operates under the same name. You will also need to register your business with the Food and Drug Administration as they regulate the sale of any form of food products or dietary supplements.[vi]
Register for taxes
Registering your business for several state and federal taxes, such as small business taxes, is the next step before you can open your store. You will also need to register for an EIN (Employee Identification Number) that helps the IRS identify taxpayers such as yourself.[vii] The type and amount of taxes you pay will depend on the kind of legal entity that you have created. There may even be different taxes for different states, as well as franchise taxes that may apply to your business. We recommend consulting with your accountant to get the proper guidance.[viii]
Get yourself a business bank account and credit card
Having banking and credit accounts dedicated to your business is essential when you want to protect your personal accounts. A business account is also vital if you want to apply for business loans, etc. A business credit card can help you build a good credit score for your company; this can mean higher credit limits, better interest rates, and more as your business grows.
A net 30 account can also help you establish and build the credit score of your business. It also increases the cash flow within the company by giving you the opportunity to buy goods and repay the entire amount within 30 days.
Get all the necessary permits and licenses
Inquire about the required licenses to sell supplements. Any failure to acquire these licenses could lead to hefty fines being levied on your business or, in the extreme case, shutting down the store. Many states require you to have a seller's permit that helps the state keep a record of the sale of taxable goods and collect the appropriate taxes. It is best to find out information about your state’s local permits and licenses by consulting your city, town, or county clerk's office.[ix]
Find a location for your store
At this point, you also need to find the perfect location for your supplement store. Find a well-traveled area like a shopping mall so customers can easily access your store. You can also contact local fitness clubs, gyms, martial arts studios, and health clubs to find out what supplements they use. Partnering with such establishments and providing attractive offers for their members can help grow your business with word of mouth.[x] As I mentioned earlier, consult with an individual or brand that has previously opened a supplement store and learn from their success – and their failures, too, so you don’t repeat history!
Certificate of occupancy
One of the significant requirements of a brick-and-mortar store is that it is run out of a physical location. In this case, the store will require a Certificate of Occupancy (CO) which confirms that the storefront meets all the building codes, government regulations, and zoning laws. If you are leasing space, getting a CO is the landlord's responsibility, and you must confirm that the landlord has a valid CO to open a supplement store. If you want to purchase or build a location for your store, then you will have to obtain the required CO from a local authority. Once again, our advice is to consult with someone who possesses experience in this area.[xi]
Define your brand
Your brand is the basic principle of your business; it is what you aim to do and what your business stands for; hence it is essential to have a clearly defined brand that will stand out from the competition. Create an easily identifiable and memorable logo to get more people talking about your store. You can also create a QR code to add to business cards and other advertising materials to direct customers to your website.[xii] People will not buy anything that they do not know about; this makes having a solid advertising game essential.[xiii] A successful marketing strategy captures the customer's attention and keeps them coming back more time after time. Ensuring your products are high quality and available at competitive prices ensures repeated customers.[xiv]
Create a business website
Once you have defined your brand creating a website is the logical next step. Go all out on the website design as this is usually one of the first impressions your brand makes on the customer.[xv] This website needs to have clear images of your store's products. You also must ensure that the website is compatible with various search engines and devices. Creating trending content for social media and diverting your viewers to your website can be more effective than other traditional forms of advertising.[xvi] Before taking the leap into opening your own brick-and-motor store you can start by providing supplements direct to customer and then start your own store once the business model makes more sense to you. For more information about how to start your own supplement brand check out our guide “The Simple 10-Step Guide For Starting A Dietary Supplement Company”.
How Can NutraScience Labs Help?
Partnering with an experienced supplement manufacturer to create your supplements can help you keep up with the latest trends in the constantly changing nutritional supplement industry.
With more than 120 years of nutraceutical industry experience, NutraScience Labs can help you formulate, manufacture, package, label and deliver the supplements to your store with ease. Our staff has helped over 2,300 dietary supplement brands create high-quality capsules, tablets, and powder formulations intended to promote healthy weight management, vision, sports performance, cognition, and much more. All our custom supplement manufacturing services are completed in GMP Certified facilities located in the USA and we offer competitive lead times and pricing on all projects.