The plastic shop business can be a promising and long-term business because it will always be needed by the community. Before opening this business, make sure you have thought about 3 main factors, namely the amount of capital required, potential profits, and future prospects.
So, if you are curious about tips for starting a plastic shop business, then you can see the information about the advantages, challenges and capital calculations below.
1. Advantages of a Plastic Shop Business
The plastic shop business can be said to be promising because it has the following advantages:
1.1 No Expiration Period
Unlike other products, plastic is a product with minimal risk because it has no expiration date. As a result, plastic products can last a long time without experiencing the slightest damage. Therefore, the plastic shop business is an interesting business for you to get involved in.
1.2 Relatively small business capital
If you want to start a plastic shop business, you don't need to worry about capital because this business can be done with small capital, around tens to tens of millions.
The capital you need to prepare can be adjusted to the size of the shop and the number of products you will sell. So, even if your capital is small, you can grow it and increase your profits over time.
Very interesting, right?
1.3 High and Consistent Demand (Every Year)
The next advantage of the plastic shop business is that it has high and consistent demand. This is because plastic is a product that is often used every day, so every year it will always be there and continue to increase. In particular, currently the growth of e-commerce is increasing, which has made the demand for various types of plastic products even greater.
1.4 Diverse Consumers
Plastic is a product that has a variety of consumers because it is needed by the majority of society. Starting from plastic bags, plastic waste, styrofoam to plastic containers, these are products needed by household consumers and MSMEs.
With such a broad target market, you certainly shouldn't waste the potential of a plastic shop business, right?
1.5 Multiple Profit Potential
You can set your own price for each plastic product marketed while still providing added value to consumers. If you are able to offer high quality plastic, attractive designs, hygiene and affordable prices, then you will definitely be able to attract lots of customers easily.
In fact, your customers will increase over time and gain many times the profits from these sales.
1.6 Tie-ins with Other Industries
When running a plastic shop business, you have the opportunity to collaborate with other industries operating in the food, beverage and textile sectors. Because almost all industries need plastic for their products. Starting from wrapping food, making attractive plastic bottles or drink cups, to wrapping high quality textile products.
Interestingly, you have the opportunity to collaborate with large industries with high profits, you know.
1.7 Easy to Manage
Another advantage of the plastic shop business is that it is easier to manage than other businesses, such as fashion or culinary. You only need to stock your merchandise, carry out promotions, then wait for consumers to buy.
As long as you diligently monitor stock and ensure products are always complete, your plastic shop will run smoothly and there will be minimal risks.
1.8 Potential for Innovation
Running a plastic shop business will keep you learning and have the potential to innovate continuously. Especially in terms of design, materials and production technology.
You can adjust the plastic products marketed according to current interests and trends. Not surprisingly, this business opens up long-term growth opportunities and becomes top of mind in the packaging industry.
2. Plastic Shop Business Challenges
Even though it has promising opportunities, it cannot be denied that the plastic shop business has a number of big challenges, including:
2.1 Tough Competition
The first challenge of running a business in the plastics industry is that there is tight and competitive competition. You must be able to compete with other plastic businesses who produce high quality products and competitive prices.
However, there is no need to worry, to be able to compete well, make sure you have the ability to innovate, offer solution products, and are able to meet changing market demands. By mastering the keys to facing this competition, your plastic business can run well.
2.2 Environmental Issues
You must already know that the plastic industry is in the spotlight because it contributes to air pollution and waste problems that damage the environment. This makes environmental regulations related to plastic production more stringent, such as complex regulatory requirements, obtaining appropriate permits, and implementing more environmentally friendly production methods.
Even so, there are several ways you can face the challenges of environmental issues. Starting from reducing single-use plastic production, producing environmentally friendly plastic, and paying attention to the process of making plastic that can be recycled.
2.3 Raw Material Price Fluctuations
Fluctuations in raw material prices will affect the profits you get when running a plastic business. Because this business uses raw material supplies from natural gas and petroleum.
Therefore, to face this challenge, you must carry out good risk management and identify alternative raw materials that are more sustainable.
2.4 Stock Management
Due to rapid technological developments and innovation, you must be able to provide products that suit market demand. In this case, stock management skills are very important for you to learn.
Of course, you can try providing environmentally friendly plastic with attractive designs. Apart from that, make sure the plastic stock that consumers want is always available and easy to find in your shop.
3. Tips for Starting and Running a Plastic Shop Business
If you are sure that you want to try starting and running a plastic shop business, you can follow the following tips.
3.1 Research and Choose a Strategic Location
The first tip for starting a plastic shop business is to do research regarding strategic locations and determine the plastic products you will sell. You can use SWOT analysis (Strengths, Weaknesses, Opportunities and Threats) to identify business strengths, weaknesses, opportunities and threats.
Start doing research in the area around the location where you plan to open a shop, whether there are many prospective buyers or not. Usually, prospective plastic buyers come from culinary MSMEs and markets that require plastic wrap. Make sure there are no other plastic shops nearby so as not to reduce potential sales later.
A strategic location that is suitable for opening a plastic shop is on the side of a road that is often passed by many people or vehicles. A suitable location to open this business is the roadside area leading to the market.
If you have determined a strategic location to open a shop, next you have to determine the plastic products you will sell. Because, there are many types of plastic products that you can sell, but choose plastic products that have the potential for large profits and are needed by many people.
If you have limited capital, choose plastic products that really have a high target market. For example, plastic bags of various colors and plastic containers for drinks and food.
3.2 Prepare Business Capital
Next, you need to prepare capital for the plastic shop business. Remember, business capital for a plastic business doesn't need to be large at the start because you can grow it over time. Moreover, if you already have your own place, the capital required will be lighter.
To meet your business capital needs, you can use the savings you have collected or through productive financing at banks and finance companies. BFI Finance can be a solution for financing your business capital with various benefits such as high disbursement values and competitive interest rates. BFI Finance provides financing with BPKB guarantees for cars, motorbikes and house certificates for various productive needs. Complete information regarding products and other financing benefits can be accessed via the following link.
3.3 Apply for Business Licensing
So that your plastic shop business can run smoothly in the long term, make sure you start applying for business permits so that your business is registered officially and legally. Business licensing related to the plastic business is quite complicated and has many requirements. Even so, this business license is important so that you can sell safely and find more consumers.
3.4 Choose the Best and Most Trusted Supplier
Choosing a good supplier is one of the important things that you must pay attention to. Make sure you choose a trusted supplier who has a wide variety of plastic products and is not complicated when asked to send goods.
If possible, try to choose a supplier who offers low prices but high quality. Also make sure that the supplier always ensures stock is available so that potential profits increase.
3.5 Complete Stock of Plastic Products
Next, you must be able to fulfill your stock of plastic products so that they remain complete and able to meet consumer demand. The way to do this is by choosing the right distributor who is able to offer the lowest prices, high quality and complete with the best plastic products.
Use social media to find a list of plastic distributors, then compare the prices, quality and completeness of the products they offer. Of course, establishing relationships with distributors is very important so that the stock of the products you sell is always complete.
3.6 Promotion of Plastic Shop Businesses in the Area
The next tip that is important for you to do is to promote the plastic shop business. The goal is so that many consumers know about your business and attract more customers later.
Some promotional methods that you can try are placing banners in front of the shop containing important information about the name of the shop and the completeness of its products. Make sure the shop name you create is easy for consumers to remember. The banner must also look attractive so that many consumers are interested in trying to shop at your store.
Apart from that, create promotions from flyers with attractive designs, then give them to customers and potential customers who pass by in the area around the shop. Also take advantage of social media for promotion, be it via Instagram, Facebook, Twitter and others.
You can also provide attractive promotions or discounts for every purchase of a certain amount. Of course, promotions like this will attract the attention of many buyers.
Interestingly, promotion can also be done through word of mouth, then introduce this business to relatives, friends or anyone who has the potential to become a potential customer.
3.7 Good Financial Management
A business can run smoothly if it has good financial management. Make sure to always record every expense and income every day and every month. With it, you can manage your finances appropriately without experiencing the risk of loss.
3.8 Develop Your Business in E-Commerce
Apart from opening a plastic shop offline, you can develop your business online through e-commerce too. Create a shop on several popular e-commerce sites, then use the best marketing strategies to attract the attention of potential consumers.
3.9 Team and Employees
A good plastic shop will run smoothly if it has a solid team and employees. So, make sure you look for a team and employees who are able to work well and know every description of the products offered.
3.10 Build Good Relationships with Customers
The next tip for starting a plastic shop business is that you have to build good relationships with customers. Avoid differentiating services for customers who buy products in large and small quantities.
Continue to provide good service and provide complete explanations when customers ask. Apart from that, make sure you always accept criticism and suggestions from customers to improve store service for the better.
3.11 Follow Trends and Developments
So that your business always runs smoothly, make sure you actively follow current trends and developments. The goal is to be able to compete with other business people in the same industry. Create plastic products with attractive designs, high quality and environmentally friendly to attract people's attention.
3.12 Best Service
Provide the best service to consumers who come to your plastic shop. Starting from a clean, neat, friendly appearance, fragrant rooms and no differentiation in service to buyers who buy large or small quantities.
Apart from that, provide free delivery services so that buyers feel comfortable and have the potential to become regular customers in the future. Make sure you always provide information honestly, validly and easily understood by consumers.
4. Estimated Initial Capital and Plastic Shop Business Profits
In fact, there is no definite reference regarding initial capital to start a plastic business. Because, the amount of capital you need can be adjusted to how big the business you want to run.
However, here are estimates of initial capital and profits that you can look at to start a plastic shop business, namely:
4.1 Initial Capital
For initial capital, you must prepare at least IDR 26,500,000 with the following details:
1. Shop Rent: IDR 20,000,000 per year
2. Glass Display Case: Rp. 3,000,000
3. Wooden Shelves: Rp. 3,500,000
4.2 Operational Costs
Meanwhile, for monthly operational costs, the budget you must prepare is around IDR 21,900,000.
1. Employee Salary: IDR 3,000,000 per month
2. Water and Electricity Bill: IDR 800,000 per month
3. Plastic Products Per Month: Rp. 15,000,000
4. Other Products (stationery): Rp. 100,000
5. Promotion Fee: IDR 2,000,000 per month
6. Unexpected Costs: IDR 1,000,000
If added up, the estimated initial capital and operational costs per month that you must prepare are IDR 48,400,000 or rounded up to IDR 50,000,000.
Of course, you can still reduce the amount of the budget depending on the large stock of plastic products that will be resold. Capital requirements can also be reduced if you open a business at home.
If you have more capital, try to increase the supply of plastic product variations so that they look more diverse and complete. So, consumer attraction to your business will be high and you will have the opportunity to reap big profits.
4.3 Estimation of Business Profits
If you want to know the estimated business profit, you have to calculate the number of plastic sales per month, then deduct operational costs. The profit calculation for small plastic is around 5-10%, while for large plastic it is around 10-20%.
The formula used to estimate business profits is:
Profit - Operating Costs.
For example:
If you succeed in selling around 250 small plastic bundles with a profit of IDR 1,000 for each plastic and 500 large plastic bundles with a profit of IDR 2,000 for each large plastic, then:
250 small plastic bunches x margin 1,000 = IDR 250,000 per day
500 large plastic bundles x margin 2,000 = IDR 1,000,000 per day
So, in a month you can make a profit of:
Small plastic (Rp. 250,000 x 30 days = Rp. 7,500,000) + Large plastic (Rp. 1,000,000 x 30 days = Rp. 30,000,000) = Rp. 37,500,000.
This profit is minus monthly operational costs of IDR 21,900,000, so your net profit is IDR 15,600,000 per month.
That's information about plastic shop business tips, advantages and challenges that you can find out. how, very tempting, right? You can start this business right now with a flexible budget according to your abilities, then develop the business slowly as time goes by.
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