Launch Retail Business In Pakistan Now (Practical Tips)

In this super cool article  you will learn about the factors you need to consider prior to launching retail business in Pakistan along with that you will also learn how to manage the whole retail thing effectively.

Note: Present Jan 2017, One gram gold value equals to 4811 Pakistani rupees, since gold value remains stable while currency value fluctuate thus we see hike/dip in gold price, therefore I will provide estimate of each business ideas in gold too, which will make estimates of this article valid even 100 years from now.

Also last time I shared some really cool business ideas for Pakistani market, you can check that one too for more super cool ideas and have shared many other posts too.

Let’s first talk about Return on Investment (ROI) in retail, the most important factor you need to consider while going for retail business in any given niche in Pakistan.

Retail Business & ROI

When it comes to ROI in retailing, it depends on many things, primarily on products/services nature, location, investment, product, service demand & target market type, branding of the outlet, competition etc.

For instance there is quite healthy ROI in medicine business in Pakistan, you can earn from 20% to 70% per rupee invested, then there is normal retail business, where you sell day to day normal stuff (ROI here varies between 15%-40%), then there is garment sector, which too has tremendous ROI, normally varies between 15%-60%.

Running normal rotti making tandoor can also yield some healthy result, although it depends on location, competition in that area and demand.

In a nutshell if you want to calculate how much you will earn per rupee in a given retail business you should consider and think over the following factors.

Six Factors to Consider While Launching Retail Business

1. Products/Service Nature
2. Location
3. Level of Investment you are planning to do
4. Demand & Target Market Type
5. Branding of the Outlet
6. Competition

Let me give you an example on how to consider these factors.

For instance I am offering fresh fruits & vegetables, the nature of such products/services is, they are perishable items, you can’t store them for indefinite period of time, even if you want to, you can preserve them for a limited amount of time.

I hope I am not getting you bored with this a bit formal way of writing here, if I do, if you are! take a break, do some stupid facebook and then get back to the rest of article after sometime ;p, because its really important that you give full concentration to the whole thing, to understand it clearly.

Okay let’s get back to the topic

So storing fruit & vegs will require you to have something that look like a big fridge or you may not need fridge at all, why?

Maybe you are in such a location, where climate is naturally fridge like… ;p, so you see location do plays a key role, location is also important for many other reasons, one is even if you are retailing great products/services with awesome market demand you won’t be able to sell it if your location is far away from your target market.

Making big retail (means huge investment) store with awesome products/services at great location will yield healthy ROI, level of investment plays a key role in success of any business, not just retail business.

You need money, paisa to buy stuff at lower prices in bulk, to fill up your retail outlet with all needed products, services and most importantly to brand your outlet, to make it standout in the crowd (crowd here refers to your competitors).

Besides you must have heard money makes money, paisa paisay ko khenchta hey!

The more you invest the more products/services you will be able to offer at your retail and hence the more opportunities you will have to make sales and thus healthy ROI in the end.

Coming to demand and target market type, I believe these two factors play a really damnn important role in success of any business.

If people love fruits & vegetables, want to eat it but can’t buy it, which means although your product is desired by many but your target market type is one with low purchasing power and so they can’t buy your stuff.

That means your business will be doomed to fail if you launch your business in hope of targeting such market.

So it’s important that you are clear about demand of your retail niche and also the purchasing power, spending habits etc of the target market.

Now even if you have awesome products/services for retail with super cool location and big money to invest in along with all that, you see crazy demand for the whole stuff with healthy purchasing, spending habits of your target, you can still make little to no profit because you haven’t done proper branding of your retail outlet.

Branding is necessary, if you fail in effectively branding your business, you will fail to make some healthy profits, yes you may achieve average, normal ROI but nothing more than that.

I have written extensively on business branding, marketing, advertising, you can learn some practical stuff from there to make your brand stand out in the crowd consequently making pretty cool ROI in the process.

Finally if everything is in desired state (from factor 1-5) but there is one thing, that is there is immense competition in that business niche, then it is obvious that it will be hard or really depending on competition level to achieve desired ROI.

The need for branding your outlet becomes even more important in face of immense competition because that’s probably the only way to make your brand stand out to make some serious sales continuously.

Bore to nahi hogaye nah ?!! agr howy ho toh niklo is page se abi … ;p

Okay jokes apart here is ROI for different retail businesses in Pakistan

Here is a little list of different retail businesses with ROI etc

This list has been made after visiting each retail business type and collecting relevant data.

S.No	Business Type	% Return on Investment (ROI)	Business Model Type	Minimum Sales Required (monthly) Pkr to earn healthy ROI
1	Medicine	20-70% profit per 1 rupee	Retail	1 Lac-4 Lac (20 to 80 grams in gold)
2	Poultry	30-45% profit per 1 rupee	Retail	50K-75K (10-15 grams in gold)
3	Telecommunication	5-10% profit per 1 rupee	Retail	20K-150K (4-30 grams in gold)
4	Cloth Business	15-30% profit per 1 rupee	Retail	90K-8 Lac (18-166 grams in gold)
5	Massage Furniture	35-60% profit per 1 rupee	Retail	2 Lac - 15 Lac (41-103 grams in gold)
6	Furniture	15-45% profit per 1 rupee	Retail	50K- 325K (10-67 grams in gold)
7	Cone Ice cream	35-60% profit per 1 rupee	Retail	20K-40 K (4-8 grams in gold)
8	Tutoring (Location Based)	25-35% profit per 1 rupee	n/a	35K-110K (7-22 grams in gold)
9	Chicken Biryani Spot	40-65% profit per 1 rupee	Retail	95K-130K (19-27 grams in gold)
10	General Store	20%-60% profit per 1 ruppee	Retail	80K-150K (16-31 grams in gold)

Now let’s talk about launching and managing a retail outlet

Launching & Managing Retail Outlet

Well my honest suggestion would be, before getting into type of retail business spend at-least couple of months with those who are already involved in that type of business for years (at least 5 years), which means they will be experts.

Research shows that to become an Expert in a given field you need to spend at least 10,000 hours [1] which is 4 years, if you work for eight hours a day, six days a week.

Once you connect with such people for couple of months, you will have some sense of almost all tricks of the trade and thus you will know how to manage supplies, how to deal with suppliers, what terms and conditions, how to manage the inside affairs of your business like looking after stock in the outlet, keeping check on cash flows, on sales etc.

This is really important to do.

Once you spend that much time, you will not only be mentally ready but capacity wise too, to successfully launch the given retail business.

Coming to managing retail business, you will need one guy at minimum to handle customers while you being managing the whole thing while at the same time keeping check on the guy and on the cash.

Having a little computer with sales software will go a pretty long way in helping you not only keep check on your cash but also calculating your daily, weekly, monthly expenses, profits etc and thus you will be able to know where your business is heading and what you should do about it.

In case you want to learn in detail how to manage each and every aspect of any business, from launching to managing day to day affairs then here is a must read for you: How to Launch & Manage a Business ?!

Over to you guys, for more practical, actionable tips, suggestions, help don’t forget to subscribe to this not so boring website.