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How to Raise Funds for Your Retail Business

29 January 2024

Starting a new retail enterprise can be a lot like starting an exciting new adventure; one that comes with a price tag. Securing funding to launch your independent retail shop is one of the first big milestones you’ll need to hit. So, the question is, how do you raise funds for your retail business?

In this article, we’ll provide you with a comprehensive guide of the actions you’ll need to take and the methods available for retailers looking to raise capital for their businesses.

Andrea Landi

Calculating Your Initial Investment Requirements

Before looking for investors, you’ll need to calculate the costs involved with opening your shop. It’s critical you get a full and accurate account of all the money you’ll need to cover associated costs, so you don’t find yourself half-way through the process having forgotten something that completely bars you from getting off the ground.

When you’re calculating costs, here are some things to budget for:

  • Leasing costs. Unless you’re specifically renting a small pop-up location for a short-term lease for your startup company, you’re likely going to be signing a multi-year rental agreement, which may require both a down payment and monthly rent.
  • Build out costs to make your location suitable for business, including shelving, fitting rooms, check-out counters and registers, water closets, stock rooms, special lighting, security, and of course any signage or decorations. Structural works need to be approved by the lessee and government administrators, meaning you’ll need licensed contractors.
  • Marketing costs to get your name out.
  • Inventory, inventory, inventory! You can’t run a store if you have nothing to sell!
  • Insurance, wages, a website…

Financing options

Once you’ve calculated your start-up costs, it’s time to explore your options for funding your small startup business.


If you’ve managed to put enough money aside to fully cover all costs associated with opening your shop, and left yourself with enough wiggle room to survive while waiting to turn a profit, you may want to fund your retail business completely out of pocket.

With no loan to repay, you won’t be starting at a deficit, which is a great position to be in. Once you cover operating costs and taxes, every bit of money you take in is going to you and your business for future reinvestment. What’s more, you maintain full creative and fiscal control of your business. However, you are also bearing all associated risks.

Family or Friends

Deciding to open a retail store is a major life decision and it’s only natural to want to share this journey with your family and friends. Likewise, it may seem like a great idea to involve your close connections in your retail dream.

Seeking investment from family or friends can be a viable option, but isn’t without risks. Indeed, money is one of the most common reasons for strife in relationships, so don’t rush into anything without full, open communication.

If you want to gather funding for your business while protecting your relationships, be open and honest and offer the same quality of pitch you would prepare for any other investor or financial institution. Here’s a few rules to keep in mind:

  • Be honest about the risks associated with running startup businesses,
  • Be professional – this is a business proposal for capital investment, leave your personal relationship at the door,
  • Create and provide them with a concrete business plan so they can evaluate the risks and see where the funding will go,
  • Keep them in the loop at all times with regular updates,
  • Don’t hesitate to make a formal, written agreement and always honor your commitments.
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Small Business Loan

A small business loan is another option for raising funds for your retail business. In the UK, you can apply for grants or a government-backed loan of up to £25,000 if you’re over 18, live in the UK, and plan to start a UK-based business or have one that has been around for less than 36 months.

For a bank loan, you have the option of applying for a secured (with collateral) or unsecured (no collateral) loan. If you are unable or unwilling to provide collateral, it may affect how much a bank is willing to lend and the rates and terms they are willing to accept. In any case, you will need to provide the following information:

  • Information related to the business, including business plan, turnover, profitability, cash flow statement, profit and loss account, years in operation, and any assets.
  • Information related to the company’s management hierarchy.
  • Information related to you, such as your credit score, and if you are a veteran, minority business owner or woman, as special government initiatives and grants are in place to help members of these groups.


Another option for raising funds for your retail business is crowdfunding. Crowdfunding is the practice of getting small amounts of money from a large number of people.

When crowdfunding, you can ask for capital donations, offer rewards or discounts, ask for a debt-based loan offering repayment with interest, or even offer equity in the business. Crowdfunding has seen an enormous rise in recent years with platforms like Kickstarter, Indiegogo and GoFundMe.

It’s important when crowdfunding to create an engaging campaign that will incite users to take part in making your dream a reality. You should think about what kinds of rewards you can offer, how to communicate about your startup company, how to reach out to the largest number of potential investors, create an engaging video explaining your project, and be sure that your incentives are realisable. It’s important to honour those commitments if you want to maintain goodwill for your small business.

Angel Investors, VC, Incubators

If your business has proven its potential for high growth, you may be able to attract the interest of some individuals or firms who will happily provide startup capital in return for a piece of the pie or a good return on their investment.

Angel investors and business accelerators will help you cover the early costs and help you get past the first stages of your development goal. Their goal is to get you profitable as quickly as possible in order to make a substantial return on their investment.

Business incubators and venture capitalists will often take more of a direct role in the management of the company. They will provide you with funding and perhaps provide you with the networks you need to secure your growth and development. However, in return, they request equity in the business, and may even request a board seat or some kind of say in the decision making.

Pitching your business

If you want to draw the attention of a VC firm or business incubator, you’ll need to learn how to pitch your business. A pitch deck is a great tool that will help you explain your business and its potential in a succinct and easily digestible way.

Your pitch deck should include research on competition, your products, marketing plans and finances. Keep the information concise and use graphs and short sentences to drive the point home in as few slides and sentences as possible.

You should also learn how to explain all about yourself and your business in a 30-60 second elevator pitch. Especially when you are networking professionally, it’s always great to be able to have an introduction like that on hand. You never know when you’re going to run into your future business partner.

Business Plan

When it gets down to brass tacks with any potential investor, it’s imperative you create a solid and complete business plan. A lot of work goes into making a business plan, but it’s worth the effort if you’re going to attract any serious investors. Read our article on business plans for more information.

Building Your Online Presence

Another important aspect of attracting investors in today’s market is building a strong online presence. Seeing strong online engagement can help convince investors of the widespread appeal and potential of your startup business.

Even if you decide that your company won’t have an online store and only offer physical sales, creating a strong social media presence in your region is critical for proving to investors the viability of your retail business.


It’s important when looking for funding for your retail business to explore all the options available to you and choose the option that best fits your business model and expectations. Feel free to shop around and reach out to other independent retailers or experts for a bit of advice or guidance on how to make your choice.

Think about joining the Ankorstart programme, a totally free platform that connects independent retailers with industry experts in all fields of the retail universe.

And, by joining the Ankorstart programme, you benefit from our exclusive payment options with up to 90-day, interest-free payments for purchases made on Purchase the stock you need to fill your shelves and pay for it only once you’ve officially opened your doors and started making some sales.


What is the best option for raising funds for my retail business?

There is no best option that’s right for everyone. If you’re willing to bear the risks entirely and have the funds you could opt to fully finance your business using your savings. Otherwise, you could look into securing a loan, crowdfunding, or searching for outside investors or business incubators. Everything depends on your specific situation so it’s important to shop around and explore all of your options!

What steps do I need to take to fund my retail business?

Start by coming up with a complete and accurate accounting of all your initial expenses: rent, insurance, marketing, wages, inventory… It’s a big list and you need to make sure you note everything. Then create a business plan that takes all of that into account, find your break-even point, decide on your pricing strategy, and work on a pitch that you can show to investors with all historic information and your most accurate forecasting.

What is a pitch deck?

A pitch deck is a slideshow that you will use to concisely inform potential investors of all the information relative to your business. This should include competitor analyses, your financial situation, marketing strategies, the products and services you offer, and a market analysis proving demand in your niche. Remember to KEEP IT SIMPLE, you can always provide more information at a later date if you need to nail down details with interested investors.

How can I apply for Ankorstore’s flexible financing options?

If you are currently in the process of opening an online or physical retail store, sign up and join the free Ankorstart programme. Once you’ve completed registration, a retail expert will get in touch with you in order to get a better understanding of your business and help you through the process of setting up with our flexible payment options. By registering to Ankorstart, you can enjoy 90-day, interest-free payments to purchase the stock you need to launch your store.

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