How to set up your own market stall

ReenaSewraz
by Lovemoney Staff ReenaSewraz on 28 February 2013  |  Comments 1 comment

If you fancy yourself as a bit of a Del Boy, here are some tips to get started with your own market stall.

How to set up your own market stall

A market stall is a great way to earn a little extra money or even start your own business.

Big names like Tesco and Matalan started life on a market stall, so with a little entrepreneurial spirit you could go far!

If you're interested in becoming a market trader, here are a few points to get you started.

Decide what to sell and where

A market is the perfect place to showcase a creative or culinary talent, or even to indulge a passion.

It’s up to you what you choose to sell but it pays to do some research beforehand. You could try setting up on an online marketplace like eBay or attend a car boot sale first to get a taste for selling and understanding what people want. Originality will increase your chances of securing a permanent pitch in a market, so visiting a few to spot a gap to fill is a good way to start if you haven’t already got something in mind.

The location is also important as you want to join a vibrant market with a lot of footfall, but avoid spending loads getting there. You can research the markets near you on the National Market Traders Federation website.

Whatever and wherever you choose to sell you will need to make sure you abide by the Trade Descriptions Act. This means not selling counterfeit goods and making sure you describe your products correctly. If you don’t, Trading Standards can fine you.

Also bear in mind that if you want to sell food there are a lot more things to consider. Usually you will need a food hygiene certificate and to adhere to food hygiene legislation, such as temperature controls when selling and transporting food. If you prepare the food yourself you will need to register with the Food Standards Agency and agree to inspections at least once a year. More information can be found in this guide from the Food Standards Agency.

Stock, equipment and transport

If you plan to become a regular market trader you will want to have a steady supply of stock.

You can go to wholesaler markets to explore and source products or use trade publications like The Trader or Market Trade News to find a supplier.

You will also need to think about a stall to show off your goods. Some permanent markets like Old Spitalfields Market in London provide you with equipment to set up. However some don’t and you may have to buy or hire your own stall, especially if you’re a casual trader to begin with.

You can find second-hand deals in trade publications or you can buy a new stall from specialist manufacturers like Gavin Keening from £136.65.

Another thing to consider is how you’re going to transport your goods. If you need specialist equipment or have large products you might need a van, but if you need less space a car might be enough. It’s also a good idea to establish where you can park when you apply to trade in order to avoid any unnecessary fines.

Licence and pitch

Whatever you sell you will need a street trading licence and a designated pitch to set up in.

You can apply for a licence from your local authority and in most cases this will involve an application form with a non-refundable fee.

Individual councils are likely to have other criteria you have to meet in order to successfully apply for a licence, like selling things appropriate for the market and special procedures if you’re selling food.

Once approved you need to apply for a pitch. If the market is council run, this can be done with your local authority. But if the market is privately operated, you will need to contact the management company.

You might have to start as a casual trader before being able to go for a permanent pitch. This gives you the opportunity to see if your goods sell without being tied into a lease agreement and for the management company to see if you’re worthy of a permanent spot.

The cost of a pitch will vary significantly depending on which market you go for, so do a price comparison if there are a few you're considering.

Temporary pitches can cost as little as £10 a day but can be much more in very popular markets.

Insurance 

Public liability insurance is a legal requirement for anyone setting up a market stall. This policy protects you against any accidents or injuries to the public while trading and cover is usually required to be at least £5 million.

You will also need employers' liability insurance if you plan to employ any staff to help you out on your stall, even if they are casual or unpaid.

Product liability insurance could also be useful, as even if you haven’t manufactured a faulty or dangerous product you could be liable for selling it.

There are a number of providers of public, product and employers’ liability insurance for market traders, so shop around to find the best deal for your business. Try the Combined Market Traders Insurance Association for a start.

But it’s worth pointing out that the National Market Traders Federation offers a free market trader insurance package if you register for membership. As well as public, product and employers' liability (up to £10 million with no excess) the package also includes discounts on breakdown cover, card machines and virtual terminals for online shops. Membership costs from £102 for a sole trader.

Getting paid

Traditionally cash is king on a market stall. But if you choose to invest in new mobile Chip and PIN technology you could increase your sales.

The National Market Traders Federation has discounts available on Chip and PIN services to its members and other smaller companies like PayPal are offering cheap new payment solutions operated via your mobile phone. Read: PayPal Here means we'll soon be paying with card at the market for more.

Although you will have to pay a small transaction fee on your sales, having this option available will mean you never have to turn a shopper away.

Tax affairs

As a market trader you will be self-employed so will have to register for self-assessment within three months from when you start trading. You can register online at HM Revenue & Customs. If you don’t you could face a hefty fine. You will also have to take care of your NI contributions.

Also if your turnover reaches £75,000 in any 12-month period or less you will need to register to pay VAT with HMRC. Currently the standard VAT rate is 20% on sales. But you can claim the VAT back on purchases you make for the business.  

Make sure you keep your books in order as after the first year of trading you will need to submit your accounts to HMRC. There are short courses on book keeping that you can do to help you get to grips with it all if you find it a struggle.

Useful websites

Here are some useful websites to help with your research:

More on making money:

How to sell successfully on eBay

How to make money in the evening

Flu Camp: make £3,750 by getting the flu

Five ways to make money from your car

Recycle your things for cash!

How to be successful at a car boot sale

Make money from your hobby

 

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Comments (1)

  • RichardSowler
    Love rating 18
    RichardSowler said

    The VAT registration threshold is now £77K.

    Report on 28 February 2013  |  Love thisLove  0 loves

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