Initial Financial Investment

Where does all of this initial funding go? Here is a sample range of estimated initial investment costs for a NEW store. Costs will vary for an existing store.

Estimated Initial Investment
 

     Low     
    High    
Fixtures
$    55,000
$    85,000
Inventory
90,000
170,000
Leasehold Improvements
20,000
110,000
Retail Equipment
20,000
35,000
Miscellaneous Expenses
      15,000
      20,000
Total Initial Costs
$200,000
$420,000
     
Plus Working Capital
$    50,000
$    80,000
Total Required Capital
$250,000
$500,000
 
     

Capitalization of Estimated Initial Investment

 
     Low     
    High    

Cash investment of 1/3
        of Total Initial Costs

$    67,000
$  140,000
Cash for Working Capital
      50,000
      80,000
Total Cash Requirement
$117,000
$220,000
     
Loan Proceeds
$  133,000
$  280,000
Total Capitalization
$250,000
$500,000
     

 

Detail of Estimated Initial Investment

FIXTURES

$55,000 - $85,000 Includes permanent and temporary seasonal fixtures for product displays, as well as additional components for non-Hallmark product gift fixtures, signing, stock room, etc.

OPENING INVENTORY

$90,000 - $170,000 Inventory is divided into three main categories:

Everyday Products $45,000 - $60,000 Includes greeting cards, gift wrap, stationery, albums, party ware, etc. that are not tied to a specific season or holiday.

Seasonal/Holiday Products $10,000 - $50,000 Includes greeting cards, boxed cards, gift wrap, gifts, ornaments, etc. that are related to a specific season or holiday.

Non-Hallmark Products $35,000 - $60,000 Purchased through an optional program, which offers help with order planning, credit guarantees on initial orders and, in many cases, discounts that may not be available elsewhere.

LEASEHOLD IMPROVEMENTS

$20,000 - $110,000 Estimated costs to finish the leased space include carpeting, electrical, plumbing, lighting, track lighting, interior walls, special ceiling treatments, sprinkler systems, exterior signing, etc.

 

 

Financing

While Hallmark does not provide financing, you may contact Crown MAC, a Credit Corporation for Gold Crown Retailers at (800) 216-4622 to apply for financing. Click on the link below for additional information on Crown MAC.

Crown Mac Information

 

 

RETAIL EQUIPMENT

$20,000 - $35,000 Point-of-Sale cash registers, pricing machines, calculators, business and accounting systems, etc.

MISCELLANEOUS EXPENSES

$15,000 - $20,000 Estimated costs to cover insurance, deposits on utilities, retail license fees, store installation costs, introductory advertising, promotional costs, and travel expenses for training.

TOTAL INITIAL COSTS

$200,000 - $420,000 Total of the above items in the Estimated Initial Investment.

WORKING CAPITAL

$50,000 - $80,000 In addition to the initial investment costs estimated above, over the first few months of business, you will need a cash reserve equal to at least 4 months' operating expenses (rent, utilities, payroll, taxes, inventory restocking, etc.)

TOTAL REQUIRED CAPITAL

$250,000 - $500,000 Initial investment costs are estimates only. Actual costs will vary depending on type of store (mall or strip center), store size and geographic location.

 
 


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