Opening an LYS

#1

I am in between jobs at the moment and am toying with the idea of opening an LYS. The problem is i have no training in business and am not sure where i woulod start in putting together a business plan.I’m also concerned that with the financial markets being what they are at the moment, now is not a good time to be opening a small speciality shop.

The pros:
There is no LYS in my town, the nearest is a 30 - 45 minute drive away and is a department store so no ‘personal’ help or opportunity to try and learn etc.
There are a lot of knitters in my town and a small guild of fiber artists.
There are several small shops in and around the town which are currently up for lease.
I am good at organising and managing money.
I would like to be working in an environment that made me happy.

The Cons:
i have no capital whatsoever
I have no business training
The economy in the UK is not healthy right now
i am still a relatively inexperienced knitter.
IT seems daft to have just finished a degree and masters in forensics and palaeopathology and then open an LYS.

Any tips, thoughts or advice? is this a silly idea? have you done this?

#2

Can you do what’s called an informational interview with someone who has a small shop to see what it really takes? Even if it’s not a yarn shop, the basic principles might be the same. Or see if you can get to a LYS and see if they’ll talk to you about it. Here in my town we have an agency that is set up just to help small business owners. They offer training and counseling in just these areas (of setting up your own shop). You might look around and see what resources are available.
And as far as getting a degree in one thing and doing something else? This is not as common as you might think.

#3

I started a plant nursery about 15 years ago and ran it for 12 years before shutting down. It is very tough to get up and running if you are not familiar with running a business. There is a fine line between charging enough to make a living and pricing yourself out of customers. Do you have enough money to live on while you get the business up and running? That can take several years to get enough clientele to support you while giving you enough surplus to continue to improve inventory and pay employees. I was fortunate in that my husband had a job that supported us and I was able to use the profits the first few years to increase inventory and improve facilities. I never made enough to hire help and the work eventually took enough toll on my body I couldn’t do it anymore.
Having enough knowledge of what you stock to be able to help customers choose the proper type and weight of yarn for their projects is essential to repeat business. I sold knowledge as much as plants. I had a lot of beginning gardeners who needed to be walked through plant care and basic landscape design.
There have been a number of people on this forum who have talked about taking a problem project to their LYS to get help translating a pattern or demonstration of a new stitch.
I don’t want to rain on your parade, but if at all possible you should try and get a job in a yarn shop and learn the ropes first.
Best of luck and I hope you can make it work.

#4

I think it sounds like a great deal of fun!

However, as I watch businesses around me open and then close within a few months, I often wonder if folks realize when they start out that the rule of thumb is to have enough capital to see you through at least a year…because it’s supposed to be a year before you begin to break even…much longer to start turning a profit.

So…I’d definitely get some expert advice. I’m sure that inventory for a yarn shop is quite expensive, and you’d have to front that.

That’s pretty much the extent of my knowledge…I know there are small business loans and such, but they may be hard to get just now…definitely research it thoroughly before jumping in!

But once you do, if it looks feasible, then I’d say go for it! Just make sure your expectations are realistic. :slight_smile:

#5

Here in the states there are many small business grants. Does the UK have anything like that. There are also classes you can take to educate yourself regarding how to run a small business. Does the UK have anything like that?

#6

I tend to agree with Plantgoddess+ on this. After reading a few threads on opening an LYS, you need tons of money just to stock up for opening. Yarn manufacturers won’t sell yarn under a certain quantity. Try imagining that you would like a few Rowan yarns, in a few colours, in a sufficient amount for a person to go in and buy enough for a sweater. And you’d like to keep at least 5 different yarn brands for a start. I think i remember someone saying it’s at least 50,000$ for the stock. If you don’t have any experience in running a business - i’d go with forensics - it sounds fascinating! I don’t mean to offend or anything :hug:

#7

I’ve no clue myself but I Googled these sites which look quite good.

www.businesslink.gov.uk

#8

From what I have seen in my community, here are a few things to consider:

  1. Well established LYS’s are having a hard time staying ‘in the black’.
  2. A LYS can’t compete with the prices found on the internet.
  3. Opening an LYS takes a ton of capital for new yarn stock, books and accessories…and you pray they sell before they become passe and you have to eat them.
  4. Knitters are savvy yarn shoppers…and will shop for the best price for the yarn they want. The best price is always on the internet, even with shipping included…but internet yarn shops are getting smart about requiring a minimum purchase for free shipping.
  5. Even though there are no LYS’s in your area, you must have 100% certainty that the folks will come visit with money in hand. What are the economics of the area? Will the knitters pay $10.95 per skein x 15 for a sweater? Or will they rather visit WEBS and pay $6.95 x 15 for the same yarn?
  6. The investment in time will suck the life out of the new LYS owner. Plan on 18 hr days, 7 days a week for 7 years to get established.
  7. Without a prudent business plan and the proof that you have the experience to run a shop from the dollars & cents end…you might not get a business loan from a bank.

Why not try buying wholesale yarn & accessories in small amounts and re-selling them on Ebay? I’m a regular shopper at four Ebay Yarn Shops, as well as WEBS. One of the Ebay shops is a lady who sells out of her house about an hour drive from me! Another one of my FAV Ebay yarn shops is located in the UK…Cucumberpatch. I always like buying from her…and she offers such good shipping, sometimes free on a special for large purchases of a bag of 10.

With a brick and mortar LYS…you will pay rent, utilities and wages every single day…even on $0 total sales days. My local LYS says she’s slowly sinking, and this is after 5 years in business. She has way too many $0 total sales days…and she still pays her help, rent, and utilities. She doesn’t know how much longer she can hold onto her business. This coming Holiday Season will be a time of reckoning.

#9

I know that if I had considered all the things that could potentially go wrong, I never would have had the courage to start my own business. But, even having said that, you must consider what you CAN do and what you CAN’T.

If you don’t have a lot of capital, can you start on a shoestring? If you can’t afford a brick & mortar establishment, can you start online?

I will tell you this: Build your business around YOU! The first and foremost thing to consider is your own personality. Shape and mold your business to your strengths, and carefully avoid your weakness - whatever they may be. Be in it for the long haul. Give it time. and most importantly of all

MAKE IT FUN FOR YOURSELF!!!

VAPORIZERS

#10

I would consider doing two things…

  1. taking some business classes and
  2. working in an LYS to learn how it all works.

This is a huge undertaking and not for the fainthearted.

#11

Excellent advice. Know what this [I]really [/I]looks like and then you can make a good decision.