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Honestly? Launching a retail business costs money. A lot of money, no point going into it pretending otherwise. And once you are up and running, businesses fail because of cash flow issues. It’s something that can bring any of us down. It’s certainly caused sleep deprivation for me before!

When we were starting out we had a lot of hard times, partly because 1) if I had actually thought about what goes into running, buying and designing for a successful store I probably would have hot footed it in the other direction, but also because 2) I was naïve about finances.

The good news is I’ve now come out the other side of those sticky patches (through sheer hard work and bloodymindedness!) so I can give you a 101 in what not to do. If you’re just starting out you might not have a full grip on these finance issues yet, but you’ll sure as hell need to.


Figure out pronto your break even point, and be brutally honest. So many people underestimate how much they will need to start a business and how long it will take to make a profit. I started off with such a hippie dippy way of thinking – “So what if  I don’t make much money, I just want to find and sell beautiful products”. Didn’t last! You know why? You can’t source and buy the most beautiful products if your store is making no money. Wise up to your bottom line fast because if your profits are growing, so will your company – and that’s the addictive bit! No profit = no growth + no achieving your dreams = no fun.


I don’t mean a bit of spare cash for a tough few weeks I mean the equivalent of at least six months rent, wages and bills. Save up enough cash for emergencies because I can guarantee that at some point you will need it. It could well save you from going under.

When you start out your business will fluctuate all over the place. For every good day there are a lot of days where hardly any money will come in at all. Full and frank disclosure here, I didn’t have any emergency funds set aside when I started, and in my worst most stressful moments (EVER, in my life) I had to pay rent, wages and bills on credit cards. There simply wasn’t enough money coming in through the door. I was lulled into a false sense of security because we started so strongly, but retail always has ups and downs. It took us ages to pay off that debt and I learnt my lesson the hard way.


Separate bank accounts are imperative. Split those out from the get go. It makes sorting tax a lot easier, and you won’t be panicking over which payments are personal and which are business related. Otherwise you’ll end up in a similar situation to me when I tried to convince an accountant that spa treatments were legit expenses as “staff welfare”. Didn’t go down too well I seem to recall!


VAT is a killer. Unless we take it out each week suddenly 3 months comes round, the VAT’s due again and we have a stonking great bill that keeps me awake at night. Set money aside it’s far easier than trying to cobble it together in one hit and it will seriously do your business harm otherwise. Trust me I’ve been there!

Regardless of whether you’re selling cakes on the sidewalk or you’ve made it to the FTSE 100, profitability is your goal. I’ll leave you with this saying: “revenue is vanity, cash flow is sanity and cash is king”.


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