Small independent builders merchant

Local builders, roofers, plasterers and other trades, plus homeowners doing renovation projects and small developers.

You buy from manufacturers and wholesalers and sell at a mark-up. Extra income comes from delivery charges and trade accounts for regular customers. The monthly figure is sales turnover, not profit, as stock costs take a large share.

• Knowing building materials and what suits each job
• Stock control and buying
• Building trade relationships
• Managing cash flow and credit accounts

• Large stock and credit terms tie up a lot of cash, so check your working capital carefully
• Public liability, employer's liability (once you hire), stock and vehicle insurance
• Planning permission or change-of-use rules for the premises, so check with your council
• Safe handling and storage of heavy goods, and safe use of forklifts, which usually needs trained operators
• If you carry waste or take back offcuts, check whether you need waste carrier registration
• Competition from national chains on price, so decide early how you will stand out

Startup costs are typically around £40,000 to £150,000, depending on your premises, stock levels and vehicles. Stock and credit terms tie up cash, so check your working capital carefully. These are estimates only.

Monthly revenue is typically estimated at around £15,000 to £75,000, depending on your range, location and how many trade accounts you win. This is revenue before stock and running costs.

Check planning permission or change-of-use rules with your council, safe handling and storage of heavy goods, and that forklift operators are trained. Also check waste carrier registration if you take back waste, and insurance such as public liability.