need some help
 

right 1st of all im now trying to get my self a unit to rent to open a rc shop ive recieved emails form several distributers saying that they will give me the go ahead to stock theyre equipment once i have a building up and running and a sign is up to show that im all ready to go:D
the place im looking at is 1000 sq ft and im thinking of sticking a indoor track for electric racing there are a few questions i could do with being answerd first tho so was wondering if any of you lads could help.
1. whats the anual fee to use the track
2. is insurance covered in the anual fee
3. equipment i will need to cator for race meets
any help would be great thanks :thumbsup:

Dont want to put a downer on it but these seems like a venture destined to fail. Model shops at the moment are going under left right and centre, and this is with much smaller premises than you are proposing.

To stick a track in a shop just seems like financial suicide

I don't really understand your three questions - surely you are the one that will set the fees and arrange any insurances - but I can tell you straight away that 1000sqft is no way near big enough to fit a track in, unless you plan to get one of the small Mini-Z tracks.

1,000sq METRES would be a very impressive space.

That's the spirit. Who said entrepreneurialism was dead? :thumbdown:

I think you should give the BRCA website, www.brca.org a good looking through, as that covers all your insurance and club questions. There are videos and guides on setting up clubs and also a list of clubs by area and what classes they cater for, along with shops to.

From my experiences clubs charge anything between £10 and £100 a year for membership, then there's a charge to use the track on race or practice days, varying between £2 to £10 for a meeting or days practice.

With regards to timing equipment the main one seems to be BBK / AMB while there is also an infra red system that MORErc use with great success and it's only a few hundred pounds compared to thousands. Probably best to pm Benh about the infra red system.

If your running a club within a shop it would be worth while checking out what an insurance company can cover you for.

As sosidge says, you should be the ones working out what people should pay, afterall you'll be the one paying the bills and income has to be over and above expenditure.

In terms of business sense I'd do a load of research in the area you plan to set up your shop. Visit clubs and toy shops and ask how they are doing, how many members they have and how often they race. See what shops sell similar things to you in your chosen area and whether you could supply items by mail order over the phone or via the internet. At the present time any shop that sells stuff relating to expendable income is going through a roungh patch as people generally have less cash to spend on hobbies.

If it were me i'd be looking at the markup on spares and cars and then work out how many you need to sell to make a living, then is there a big enough market and catchment area near you to be able to sell that amount of stock. On tires, which i would guess are one of the most popular purchases from a shop you'd make a couple of quid a pair, so you'd need to shift 10,000 pairs of tires to make £20k and then you've got to take all your bills out of that.

My advice,
1) Find an accountant that will do a free consultation and talk to them about it.
2) Look at the clubs in your area and speak to the people that will be buying the items you want to sell.
3) Look at the competition, and if a model shop is listed as a limited company get a set of accounts off of companies house for £1 and see how they are doing.
4) Work out what you can offer that other shops can't
5) What are the trade account details, can you buy stock on a sale or return basis.
6) Have a back up plan, will a bank back you for a year or two with interest and charge free accounts, or do you have money to invest.


All the best in your chosen venture.

hi thanks for the reply only reason i ask what the prices are for usual tracks is ive never raced or actualy been to any of the clubs so i dont really know what they chargeor weather the insurance is involved with theyre fees. it would be a small track to start off with then once/if buisness takes off i will expand it.
the nearest track is quite a distance from me and i was hoping to get a shop/track set up in the town where i am as the nearest hobby shop is around 20-25 mile away and would be nice to get some of the local young lads/lasses into the hobby without having to go miles

I just dont want to see this guy throw his money away

Superb reply from JCB eloquently written and unbiased well done that man:thumbsup:

good luck hammerhead lots of research will give you the information you require, as posted previously everyone is struggling in this present economy and i dont see a quick reversal yet.
If you have a house and family dont put them at risk for it , use finances you can afford "to lose"

I wish you luck where will you be based we may even visit if your not to far away

dave

im in norfolk in dereham to be exact as i said the nearest tracks/hobbyshops are roughly 20 od mile away from here i have rang a few of them to see what kind of stock they keep and i was very surprised they dont stock the likes of hobao or hpi some dont even have losi or shumacher either. when i first got into the hobby i had a real pain in the arse my savage was well knackerd lol and i needed a few parts for it and both shops that are near to me wouldnt even touch it because they dont stock the parts and to say the least they wasnt exactly customer friendly either witch put me off using them again.
i have been in contact with all of the above suplliers and they have given me the go ahead to stock theyre brands on a no sale return basis so i dont have any massive overheads on the stock department my main out lay is the premisis itself and insurance and bills etc.
there are a few people that use RC cars around here but like i said erlier they dont have anywhere to use them once/if the buisness has taken off i will be looking into renting a plot of land off a good friend of the fam to build a outdoor track also wich will then cator for the larger scale models i.e 1/10 1/8 1/5 both nitro and electric.
hopefully can get this up and running and get more people localy into the hobby :thumbsup:

i dont have any experience in running a shop but from what you have said about suppliers if it was me i would get some parts, start a website and grow from there.
if you have space to store parts at home you will have minimal overheads meaning you can start banking your profit giving you the funds to expand when business builds up, and if the worst were to happen you will make minimal losses.
this is only the way i would do it but as i said i am not an expert in these matters.

Mike

If you want to start a business selling rc gear, I would recommend setting up shop trackside. Whether it be at your local club or clubs, if you compete at regionals at the descresion of the regional reps you could get a gig there, that way you would get a regular custom base. This is how me and my old man started up back in the late 80's early 90's :) before we went the shop route.

When you start looking at retailing, you have to consider rent, rates, insurances etc + the costs fitting out a premises, cost of your intitial stock and any other initial set up costs. If you take out a business loan to start up that would need to be paid back.

Look at the figures in respects to the outgoings and what you would potentially have coming back in. I imagine you will have a home and family to support so if this was to be your main source of income you have to make sure it's viable.

Mike P.

hi mike
thanks for the reply if i could run a buisness from my home i would but for 1 its illegal to have a buisness to operate from a residential premises i know i can store it but not trade i think its only posible if we own the property but we are tennants and its against our tennancy :( the suppliers will only do a sales or return policy with me if i have a shop up and running so unless i buy the stock at silly prices and then sell them on i wont make enough profit if any to then forward into the buisness

here are the ones that are nearest but still are a fair distance between each other and a lot of the youngsters around here that are into rc wont have transport of theyre own to get to them
http://www.centralbooking.org/cbs/in...ubs&Itemid=151
KRCCC1 Kellers R/C Car Club NorfolkTrowseKLMCC
Kings Lynn Model Car Club Norfolk Kings Lynn
and theres snetterton as well but im unsure on how that stands for general race meetings etc if theres any more that people know of plese do let me know thanks

First of all you need to go back to the supliers as im 100% sure they will NOT supply on a sale or return basis (1000s would set up model shops if they did :o, oh and i run a model shop) even after many years trading all the main supliers will not let me have sale or return except when putting the shop on for a major national, your first orders will be on a pro forma basis eg you pay then you get the goods, why would they let a perfect stranger take lots of goodies for free ???
A accountant will be of absolutly no use in setting up a business, they mearly deal with bookwork and will have no idea of weather your business will fail or succeed.
You are also talking about setting up what is basically a race orientated shop yet you have absolutly no idea of racing !! sorry but racers want to deal with people who have first hand experience of racing, you need to be fully up to speed on all the latest gear, the latest rules that govern the sport eg a customer wont be happy if you sell them something for racing that is ilegal to use, and have experience or knowedge of both all the on road and off road classes (how can you tell me what i need to race a 1/10th tourer if you have never done it ?)
As for the racing, well a AMB system will set you back about £3000 to £4000, add on a lap top, software, PA system, speakers, printer plus a few sundries and you will be somewhere near 5 to 6 grand without the track, a cheep carpet track not to big will be about £700 to £1000.

Sorry if all the above sounds like a downer but think very very hard about what you are about to do, 2 of the bigest model shops in the country have just gone bust, where does that put you as a newcomer ??

Well said, couldn't agree more

good post and fair points i have my own pa system so that ones a miss
as for all the whats brca legal and not this is where my research has to come in. when i was on the phone to horizon they told me as well as hpi that they do a sales or return i will ring them again later just to be 100% ihave all my pc/printer and ill look into the software and ill have a look into the infa red sustem that was mentioned in a earlier post

A non-racer trying to set up a shop and track is like someone who doesn't eat Italian food trying to set up an Italian restaurant.

If you're going to be successful at anything in these hard times, you need to be the expert at it, and be the best. Otherwise, how will you beat the competition?

So if you want to be successful at this, you need to start racing. After you've been racing for maybe 5 years and raced each major class (TC, 1/10 off road and RallyX) for a couple of years, you'll have a reasonable idea of what racing involves and what racers want. Along the way you should get involved in a club and help out running meetings, then you'll make a lot more contacts and understand how to organise race meetings.

Until then, invest your money somewhere safer.

What a buch of kiljoys:thumbdown: Why dont you give the guy a chance and support him, alright it might not workout but with alot of shops closing down we need to give people like this a chance, or in a few years time we will have no shops in the UK, and we will all be moaning about getting stumped for import tax when buying abroad.

Good luck fella, you have at least my support:thumbsup:

Cheers mate, joys of being in my line of work I guess.



Really, now this could be interesting as so am I. I have raced 1/10 off road for the past 12 years and can tell you that the number of racers in all classes in the region have fluctuated massively.

As for clubs there are definately more than you mention.
Within what is classed as the East of England for 1/10 off road you have the following clubs, which cater for pretty much everything from Mardaves to 1/8 Rallycross.

Kings Lynn Model Car Club
Kellers Model Car Club
Norfolk Buggy Club
Mid Essex Remote Car Club
A.R.C Raceway
Coastal Model Car Club
Colchester Model Car Club
North Norfolk Model Racing Club
Beccles and Lowestoft Radio Control Car Club
Snetterton Park Model Car Club
2 in Bury St Edmunds

On the border to this region you also have

Holbeach Model Car Club
Eastrax
Stotfold Model Car Club


There's also an equal number of model shops in and around the region.



Fair enough most are more than 20 miles away but I know of 10 racers in the region that regularly travel upwards of 100 miles each way to race model cars at club meetings. Ok so your new racer won't be doing that, but thats potentially ten racers on your door step.

You also have to keep in mind that although transport could be an issue you still need to be able to get all your gear to the race track which would have to involve the parents. The other side is if the parents then leave the kids at the track who's going to look after them, help them out when their car breaks and also run the race meeting. Having been heavily involved with the running of the 1/10 off road regional scene for a number of years and helping out at various clubs it's never as straight forward as you think it should be.

You'd need to consider what class of car you were going to race at your club. If it's indoors you can't race nitro at the best of time and especailly not in 1000sq ft. Theres no point in trying to sell one thing and race others at your club people don't have lots of money to spend on hobbies and especially at the moment. Look into one class series' such as touring car, 1/10 off road, or micro's and stock the spares needed. Run to control rules on motors and the like to keep costs down. But restriciting what you can run may put current racers off if they don't have that bit of kit.

Not being silly there are two high schools and half a dozen other schools in ther Dereham which must equate to almost 4000 - 5000 kids so your catchment is pretty good, but getting them to change their mind from what sounds like fun to actually doing it is another matter.

Do your research and turn up to some club meetings. You have Norfolk Buggy Club, Kellers, Kings Lynn and Eastrax on your door step so turn up to a few race meetings and see how it all works.

Don't agree mate

Is stellios a pilot? (easyjet) etc etc

No need to be in something directly to run a business

The question here is how much is the unit you intend to rent??

thanks daz for the support i understand where the others are coming from but as you say if so many are closing i think it should be time to start changing that or yes you will get stung with income tax which is what we dont want ok so im no expert on the racing side of it but the track itself is just the sideline part of it as a extra the shop is the main buisness and like i said before you either have to travel about 20 mile away to get the bits your after (if they stock them) or order online and wait x amount of time for them to arrive. at least if theres a hobby shop in our town it might bring more people to thew hobby which then generates more buisness.
i know its going to be a challenge but hey if i dont do it some one else might and if they did and sucseeded id be gutted i didnt make my move first.
the track im on about doing will only be a small one to start that might get some kids off the street and into the hobby with a place to go and use the cars and then later on build it up aslong as buisness is good.
well thanks for all the advice chaps good and bad its all advice needed and once its all up and running id like to think id see some of you there :p

He may not be a pilot, but I bet he'd at least flown on planes for a few years before setting up an airline.

That would depend on the accountant you know!!

Fair enough not all of them are going to know about model car racing, but where I work does :D


http://www.jemmettfox.com/Home

the unit itself is 4k per annum then there is £250 legal fees and a service charge of £270 wich might be reduced due to buisnes rates

I think you're confusing "Accountant" with "Book-keeper"! It's my job as an accountant to advise on all aspects financial - in particular what is working for the business and what isn't.



Does that make me the resident Oople Management Accountant then?

Stelios may not be a pilot but he employs pilots. Hammerhead is not looking to employ someone to run the shop for him!

Good luck - but as someone who sees businesses failing every day currently - be very careful with your venture.

No i am not mixing up book keeper with accountant, all an accountant does is work with figures and tax laws eg the figues wrote doen in the books, how can an accountant tell if a new business venture is going to succeed or not, if i tell you im hopeing to turn over 3 million in my first year wiith outgoings of £100 you will tell me its sure to be a success and i will soon have my own Ferarri and private jet.
Yes you can tell an exisiting business what is working and what is not (but a good business man doesnt need an accountant for that) but you have absolutly no idea of a business that doesnt exist yet as there are no figures of income only what are estimated outgoings, in all my business,s ( i have worked for myself for nearly 35 years running 3 very succesfull business,s) an accountant was way down the list of priorities.

Just trying to help the guy get the right advise, and the best there is is to go to a small business advise centre, they have experience of the pitfalls of setting up a new business, the hidden costs we all forget, not to over estimate what the income will be etc, oh and forget asking your bank for help, they wont want to know till you are making money then they will be all over you.

So, just to clarify Bob... are you telling Hog what he does for his job?

thanks for reply bob i have a meeting tomorow with a buisness advisor and going to write up my buisness plan as for the bank they can suck on eggs for all i care lol there is a plan for grants that are to help new small buisness get up and running with quite resonable rates i have to go see them on friday to discuss everything :thumbsup:

Without prior experience it sounds a high risk venture = potential to lose lots of cash ££££

Whilst writing your business plan it might be worthwhile looking for employment within a model shop and start racing!

Apparently so - 24 years working in both practice and in the commercial field obviously gives me no qualification to comment.

Oh how wrong you are.......


Perhaps if you'd bothered to get yourself a decent accountant in the first place, you wouldn't still need to be working 35 years later.........

Couldn't agree with you more :D



Anyway perhaps we should get back to the subject in hand...................





Personally I think research into the local area would be the way to start, after all there are two shops in Dereham which have accounts with model car distributors and there was a model plane shop at one point too.

Also how many kids in the schools would be interested in car racing and more to the point how many could convince their parents to spend £200 on a model car for them. Having people interested in something is completely different to them going out and spending money on it.

For your own sake do a rough business plan to see whether the business would be viable.
First add up all your known expenditure, rent, service charge, rates, electric, phone, repairs, credit card machine, credit card charges, insurance, alarm system upkeep, advertising (yelow pages etc) no need for some expensive accountant there ;).
Then work out what you need to live on eg £200 a week would be £10,000 a year, add these together (you may need an accountant for this :D) then times this by 4 ? this is your net priofit after VAT and that is what you need to turn over to survive.
Then your start up costs, simply stock ? £10 to £15 aproximatly to start, plus obviously fitting out the shop with counters, shelves, till etc, putting in phone line, fitting alarm plus any security like shutters and grills, and they are your start up costs.
Always over estimate your running costs and always under estimate your income, PM me and i will give you rough costs on things like Alarms and insurance etc.
DONT absolutly dont realy on racers they are to fickle and will simply go where its cheepest as a general rule, Do expand your range as much as posible, Boats, planes, helies and general model suplies, you will sell far more of these than race stuff.

Those that can do it those that cant become accountants :D:D:D:p

the shops here dont stock and wont stock model cars ive asked and there is only one the other one shut years ago the one remaining stocks stuff for railways etc they dont have boats planes cars etc christ they dont even stock servos and radio gear they have a couple of tamiya lunchbox cars in the shop but that is it as i said before there are a few kids/big kids around the area that do use rc cars and i think if the option to purchace a decent rc car/plane/boat they may well do. how many people buy somthing off the net per year with no knowlege of the hobby plenty id say but given the chance to come into a store and ask whats what is more preferable. as for the advertising side of things printing flyers and distributing them door to door posters etc will all be taken care of by me and my partner the store that i will be renting has a alarm fitted and cctv all around it not inside but on the outside a till well they can be picked up cheap enough on the bay as with a credit card machine. all of these costs will be acounted for in my overall expenditures.
oh forgot went to see the property today like some one stated in a earlier post there wont be room for a track but tobe honest the model shop is my main priority and as said before once the buisness has expanded i will then look into a place for a track.


oh and lads dont get under each others shirts about it lol i only asked for some advice ;)

Hammerhead - perhaps you should speak to someone who knows what they're talking about and can advise on you on what the difference is between "running costs" and "capital expenditure" - the difference between the running expenditure (what will show you a profit/loss in your opening period) and what goes on to your Balance Sheet as assets and liabilities.

All I can do is advise you to do as much research as possible before you dive in. I've tried to help but Bob obviously knows my job far better than I do so I'll leave it up to his expert opinion to guide you on your merry way. Good luck!!

hey bob thanks for the help i know not to dive in i am going to do as much research as possible before anything happens i have a apointment to day with my buisness advisor and ill get him to explain everything to me down to the last cup of coffy being made on the premises lol as the last thing i want is for this to fail its going to be my livleyhood after all the last thing i wanted was for people having digs at each other on the thread so i will let you all know what my advisor says after ive seen him :thumbsup:

well went to see my buisness advisor today and wasnt good :yawn: basicly my overheads would be way to high for me to make a income from the shop he recon id need to make £600pw profit :o it seems a tad high but the guy knows what hes doing so his advice was taken on board so unfortunatly the dream of having my own rc shop is withering away in the mist :yawn: thanks for all the advice guys lets just hope that no more have to shut so we all dont get stung for inport taxes etc oh well no harm in having a dream eh

Maybe it is possible, but you just need to scale back your dream.

So consider starting a:
- Web-shop
- Trackside-shop

Much lower overheads as you wouldn't need business premises. Then depending on how that goes, expand until eventually you can afford a shop with a track.

The main trade supliers wont deal with internet only dealers and track side is a waste of time for 2 reasons, one like above you need premises to get spares and 2 there is not enough profit from just doing trackside (pocket money), 4 years ago there was but not now, most guys both on and off road take all there stuff with them, they may need the odd body clip or glo plug but not much more.
Yes before you all start im sure there are exceptions to this but not many ergo Microtec and Models in motion going to name just a couple of the many.

accounts have cool website shocker
 

Nice website - very non-accountant.:thumbsup:

Dreams should never be forgotten. Have to be completely honest and say I don't get why you need to make £600 profit per week, but thats most likely as I don't know the whole storey.

You'll have to pop along to a race meeting at Norfolk Buggy Club if off roads your thing. There aren't many club members but it's friendly and we have a good time.


Thanks :)