How to buy a gift shop?
You will have to be resilient, committed and proactive to make your gift shop business survive in the UK retail industry.
The long term economic impact of the UK leaving the EU has caused a cloud over the future of Britain's gift industry. However, the UK gift industry has continued to adapt due to entrepreneurs striving to focus on a unique selling point that sets them apart from the rest.
This article will tell you all you need to know about buying a gift shop in the UK.
What will be required of you
In order to be successful in the gift shop industry, you will need the following:
- Excellent communication and interpersonal skills
- Have good customer relations and dealings with suppliers
- Compromise on time with family as you will have to work on the weekend, public holiday and busy periods like Christmas.
- Great employee management skills.
What to look for in a gift shop
Any successful shop needs a strong high street presence with a high footfall of people passing by. There should be a large window to entice customers with a seasonal display.
It will also be beneficial if the business has a functioning website. An additional trading platform will allow you to not only increase your potential sales by opening you up to the global market. You can also use the website and the social media presence for marketing the business by offering online offers and promotions.
The physical appearance and condition of the shop are similarly important. You should consider the cost of any renovation and repair works required and take this into account during the negotiation process.
You also want to know what type of customers and supplier relationships the owner has in the community. You will have to see whether you should keep the same suppliers and sell a similar item? Or you could want to rebrand the store.
Location of the shop
The shop's location will determine which type of items you will have to stock in the shop. For instance, if the shop is located on the busy Oxford Street in London, the shoppers are more likely to be tourists looking for souvenirs.
If the shop is located in a small town market, then the main trade is most likely to be locals looking for gifts for their family and friends. So you will have to tailor the stock in the shop to suit the demographics of the shoppers in the area.
The process of due diligence is one that provides a thorough investigation into a proposed investment transaction. It means you check the investment worthiness, and assess the full claims made by the owner. This check is usually performed by a solicitor and accountant who act on behalf of the buyer. A large portion of due diligence will involve checking financial statements and accounts.
Click here to find more about due diligence.
If you buy wisely and do a thorough research of the background and potential of the business which attracts your interest, you will get immediate access to the existing base of customers and suppliers. This will ensure that you know what you are getting into.
You need a solid contract
You, as the buyer, will have to produce the sale document. This agreement will have to cover the mechanics of the deal – what is being sold, where it is, how it is to be transferred, and so on. This is where warranties come in. Click here to download a business sale agreement if you are purchasing a gift shop.
Warranties which are legally binding promise as facts about the business, which provide information relating to the business. Click here to know about how warranties work and why they are important.
Other documents you need
Additionally, you may need assignment and novation agreements to transfer contracts the seller is a party to.
If company shares are being sold, then you will need directors service agreements, board minutes to document approvals to changes, and possibly, a new shareholders agreement and new articles of association.
We can help you find exactly what you need for your circumstances if you contact us and ask.
Please note that the information provided on this page:
- Does not provide a complete or authoritative statement of the law;
- Does not constitute legal advice by Net Lawman;
- Does not create a contractual relationship;
- Does not form part of any other advice, whether paid or free.
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