How to open a hookah and tobacco store

Many people would like to open a hookah and tobacco store. This is a fashionable hobby, it has a lot of fans, and you can safely count on a large number of potential buyers.

But selling hookah tobacco is a business that is fraught with risk, especially if you don't have a lot of experience or none at all. An unsuccessfully chosen location, an incorrectly selected assortment or a dubious business plan, ignorance of the intricacies of current legislation - all this can cause problems.

Therefore, a good solution would be to open a hookah tobacco store under a franchise.

What is a franchise?

Franchise trading involves entering into an agreement with a brand. Brand representatives:

provide information support: from important nuances of legislation to the most common mistakes and checklists, which indicate what and in what sequence you definitely need to do;
they provide advisory assistance at all stages of the preparation and operation of your business, from general recommendations to useful tips that take into account the specifics of each specific situation;
providing low prices for most brands, lower than those of distributors in the region where the franchise can be opened;

All this, of course, is not free. The franchisee, that is, the one who works under the franchise, must pay:

the lump sum is a one-time payment and, when it comes to the business of selling hookahs and tobacco, amounts to several hundred thousand rubles;

Of course, the franchise owner is interested in making sure that the franchisee does well, because he makes a profit. Therefore, he is ready to provide all the necessary support in how to open a hookah and tobacco store from scratch.

At the same time, it should be understood that the franchise owner will not work for you. He will provide you with the most important information. You will use it, and it depends only on you how profitable the business will be.

Is it possible to do without a franchise?

Of course you can. There are people who do without a franchise, go their own way and achieve success.

But there are also those who have failed to create a workable business. Among the problems they faced in finding their answer to the question of how to open a hookah and tobacco store could be the following:

suppliers did not know the new entrepreneur and raised prices to insure against possible risks;
the newly minted businessman was not very well versed in legal subtleties, missed something, forgot about something and eventually had to pay a fine and maybe more than one;
the logo and other symbols had to be developed from scratch; it's not cheap, besides, efforts will be needed to make the symbols recognizable;
I also had to create and promote my own website – again, everything from scratch, spending money and time;
difficulties arose taking into account the goods and financial resources.

All of these problems are easier to deal with if you have franchise support. It allows you to use your logo, which has already been promoted, and opens access to the site and databases. You will be warned against the mistakes that many aspiring entrepreneurs make.

The franchise also makes it possible to achieve self-sufficiency faster. For comparison: in Russia, the payback period for a hookah and tobacco store is 1.5-2 years, and with a franchise, provided that you do not make frankly stupid mistakes, from 8 to 15 months. After that, you get a net profit.

Let's look at the franchise conditions using a specific example

The Russian company S2B invites everyone who wants to learn how to open a hookah and tobacco store for hookahs to cooperate. It provides the opportunity to open stores in two formats - standard and mini. In both cases, you will need to pay royalties in the amount of 14,500 rubles per month. You will also need a one-time lump sum payment:

the point of the standard format is 250,000 rubles;
The mini-format store is 200,000 rubles.

In the first case, the initial investments amount to about 2.1-2.4 million rubles, in the second - from 1.3 to 1.6 million rubles.

What does the franchisee get at the same time? First of all, there is a huge amount of useful information, proven in practice. The knowledge base developed by S2B specialists consists of 412 pages. Training is expected; it can be both distance and full-time: this format is available for those who live in St. Petersburg or may come to this city.

The company also offers:

personal manager support – consultations can be received 24/7;
configured 1C accounting system;
a site optimized for the city where the franchise store will be opened;
access to the database of suppliers who will supply goods with a minimum margin;
the ability to include customers in an already working loyalty system with various bonuses;
The purchase of goods and equipment on favorable terms in the event that the business cannot be promoted, this will help partially return the funds spent.

According to the company, the cost of opening a standard-format hookah store pays off in about 9-15 months, and if we are talking about a mini-format point, then its payback period is from 8 to 12 months. According to statistics maintained by the S2B brand, every fourth franchisee strives to open a second and subsequent stores. It also indicates that it is really beneficial to cooperate with this company, and the support it provides is truly effective.

It is important to know that hookah shops under the S2B franchise can be opened in any Russian city except Moscow and St. Petersburg.

What to consider when preparing for the opening of the store

If you are planning to open a hookah and tobacco store, it is better to choose a place for it in the city center, next to parking and a busy street. The second line is also suitable, because many hookah lovers are looking for outlets via the Internet, and do not focus on street signs.

The optimal room area for a hookah shop is from 25 to 60 sq. m. As for expenses, the main budget items that need to be kept in mind are:

rental of premises;
renovation of the premises;
rent or purchase of furniture and equipment for trade;
purchase of goods for hookahs and accessories for them, tobacco, coal, as well as various accessories: you should not buy a lot of premium goods, it is better to focus on the middle and lower price segments;
salary of sellers and accountant.

Also, do not forget about the lump sum.

As practice shows, up to 75% of the profit of the owner of a hookah shop is provided by the sale of tobacco. Another 15% is accounted for by various accessories, and hookahs themselves bring about 10% of the profit. You can increase sales through promotions and participation in themed festivals.

If you skillfully use the information provided by the franchise owner, you can open a hookah tobacco store, which will quickly pay for itself and begin to bring you a net profit.

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