Control Dollar Store Costs to Thrive

In owning your own business, there are various things that need to be kept in line. Inventory costs, advertising costs are just two examples of the many which could be named.  When owning and operating a retail store, one needs to consider the day to day cost of simply operating the business.  When one is operating a dollar store, due to the fact that the retail price of the products is always the same, then you need to consider and more closely monitor the cost of the daily operation of the business or your ability to achieve success with dollar stores is at risk. 

In this article you will learn how to monitor dollar store costs.  But the focus will not be each and every cost that presents itself.  Rather, this article will focus on dollar store costs which must be properly managed right from the start if you are to ensure your business is always on top.  There are three costs you need to examine in order to ensure you achieve success with dollar stores. 

#1 - Cost Of Goods

Cost of goods sold represents the biggest opportunity for cost control, and ultimately success with dollar stores.  Once your wholesale costs are in control, then increasing revenue through ever-higher sales means will result in higher profits for your dollar store business.

#2 - Payroll

When dealing with employment, there is always the need for a payroll strategy.  You will need to ensure that you develop a plan where you can sync up staffing costs with store profitability.  If cost of goods is under control, one easy way is to match payroll as a percentage of store sales levels.  This strategy also works to ensure you have proper staffing levels to meet the needs associated with increases and decreases in customer traffic and sales.

#3 – Store Rental or Lease Cost

The last one is the largest of the three is lease or rental cost.  This is a cost you and your landlord agreed upon prior to the start of the business itself. The lease payments are typically constant whether the business is improving or not.  If times get tough, enter into negotiation with the landlord to see what can be done to lower the cost of rental or lease payments.  It is not a guarantee that the cost will be lowered however it’s better to try than to not try at all.

Success with dollar stores demands you don’t open for business with these three major dollar store costs lagging behind.  It is very important that you seek ways to lower the operations costs so as to gain profit in the business.  Dollar store costs such as repair costs, public service costs, materials such as cash register tape and also maintenance costs need to be taken into consideration in order for the business to run smoothly. 

Be creative and seek suppliers that will give you better value for your money.  This will ensure that the supplier costs are down and the profit margin will be higher which is critical for achieving success with dollar stores.  Make sure that these are tabulated and are in your daily, weekly and monthly reports. This will give you a better idea as to what needs to be done so you can create more effective ways to ensure that profitability is gained.