Page 15 - Becoming-Your-Own-Banker-R-Nelson-Nash

THE GROCERY STORE

To continue with the courteous, and neat. This is going to cost you a lot
imagination exercise, I of money, too. You open the front door for cus-
would like you to tomers—they come in and load their carts with
examine the process of groceries and take them by the cashier who col-
getting into a business lects their money at the front of the store. This is
in which you are both a going to leave empty spaces in the display of goods.
consumer and a seller Your “hired help” is busy cruising the aisles, no-
of the same thing. ticing where goods have been sold and quickly
(There is a very significant reason for this exercise, going to the storeroom at the back of the store to
so bear with me). A grocery store will easily meet get more things to fill up those spaces. It is im-
these qualifications—everyone consumes perative that the store appears “fully stocked” at
groceries, and someone has to perform the any given time. The customers demand it. Have
distribution function. You have an unlimited you ever been to a grocery store that was only “par-
market. Everyone is a potential customer—as well tially stocked?” Did you continue to patronize that
as you and your family and maybe some other store—or did you take your business to another
“captive customers.” store that was more conscious of this quality?
You start it all by studying what the grocery All this means that you are going to have to
business is all about, all the things that are neces- re-stock the storeroom at other intervals to insure
sary to be successful as an entrepreneur in this field. that you have immediate access to a bountiful sup-
This is going to take some time and expense. When ply of goods. The objective of the business is to
you feel competent to start the venture you must provide you with income and to build a business
now find a good location for the business. The real that you will eventually sell to someone else to
estate folks say there are three important things provide you with retirement income.
about real estate—location, location, and location. Once you get this all set up and in operation,
For such a property you are going to pay dearly. the difference between the “back door” and the
This is not an overnight activity, either. You are “front door” is a very good living—if you can turn
going to have to spend some time locating the right the inventory enough times per year. If you sell a
place. can of peas for 60 cents at the front door, you have
Then you must construct a very nice looking to replace it at the back door at a cost of 57 cents.
building on the property. It must have a well-ar- (I have found this to be a shocking revelation to
ranged interior with attractive equipment and fix- most everyone). Grocery stores operate on a very
tures and display cases. All this is necessary be- small margin on such items. The can of peas sit-
cause your competition has been hard at work for ting on the shelf for sale represents inventory. You
years in attracting customers. Customers are go- must turn the inventory 15 times just to break even!
ing to do business with stores that are convenient, There is all that interest you must pay on the huge
that look good, that have quality merchandise— sums of money you have borrowed to buy the land,
and low prices! This means that the building, etc., the building, the signs, advertising, payroll and
is going to cost you a lot of money. fringe benefits, utilities, legal fees, accounting, etc.,
Now you must stock the store with groceries. to name a few. Turn it 17 times and you will be
The merchandise must be of good quality, attrac- profitable. If you can turn the inventory 20 times
tively displayed, and have competitive prices. Your per year you can retire early! Something dramatic
employees must be attentive to customer needs, happens once you get over the hump.

R. NELSON NASH 15