Clayton Perkins ART 1210

Cost centers Factors Fixed or Variable Yearly Cost

Computers $1,500 ( 3 Years ) Variable $500

Software / IT $100 ( 4 Months ) Variable $300

Rent $1,100 ( Monthly ) Fixed $13,200

Licensing Fixed $50

Electricity $110.92 ( Monthly ) Variable $1,331

Insurance $83 ( Monthly ) Fixed $1,000

Supplies / Inventory Variable $10,000

Drinks $100 ( Monthly ) Variable $1,200

Cleaning $88 ( Weekly ) Fixed $4,500

Decorations Variable $1,000

Salary Fixed $70,000

TOTAL

$103,081 ​per year

Hours per Day 8

Days per Week 7 8 Hours per day X 360 Days a

year = 2,880 Hours

Weeks per Year 51.43 (360 days per year) TOTAL HOURS: 2,880

BHR: $35.79 / HR
My business is called CP Kicks. This business will be part of the sneaker/shoes and clothes
industry. This business will mainly sell shoes to anybody that is wanting to buy shoes or into
shoes. Selling hard to find and super sought after sneakers that aren’t at local shoe stores like
Footlocker, Payless, and Famous Footwear. Also serve as a fun spot for people to meet new
friends and have a good time talking about life, shoes and whatever else.

Computers: ​I figured buying a new computer every 3 years would be fine. keeping up with
newer, better and faster technology to help me stay up to date and give store a ongoing modern
look.
Software / IT: ​IT maintenance is something that is very vital to my store considering I’ll always
be using computers and I can’t afford to have computers slowing down or being out of date.
Figured having someone come check every 4 months should be just fine.
Rent: ​For this I looked up the average cost per square foot of retail space in Utah and that is
how I got my estimate in cost above.
Licensing: ​Found out what licensing would be for business license in Utah and found my costs
per year.
Electricity: ​Pretty similar to rent I just found what average per square foot would cost to power
my business.
Insurance: ​Looked up basic liability insurance and found my costs to protect my business.
Supplies / Inventory: ​This cost I got based on personal experience being in sneaker shops and
just being around sneakers in general. The costs that I spend to buy shoes and the amount I
sell will vary with how much that relates to how much inventory my shop has.
Drinks ( Customer care ): ​Having drinks such as soda and or water for customers will make
them feel welcome. I just got my prices based on how much a 24 pack would be and how much
I would need month to month.
Cleaning: ​Found a website for basic cleaning costs. I don't think the shop would get too dirty
considering there's no food and wouldn’t see as much traffic as a Walmart or big store like that.
Decorations: ​Good to have new fancy decorations in a store like this to keep customers
attracted, based on personal experience and ideas of what certain decorations would cost and
what ones I would have in my shop.

Shaw, T. (2020, January 1). Federal Holidays in Utah in 2019. Retrieved from
https://www.officeholidays.com/countries/usa/utah/2019
CleanerMatch. (n.d.). Retrieved from
https://www.cleanermatch.com/commercial/retail-store-cleaning-company.html
Hamill, V. (2020, January 13). Retail Insurance: Cost, Coverage and Providers. Retrieved from
https://fitsmallbusiness.com/retail-insurance/
(n.d.). Retrieved from ​https://dopl.utah.gov/renewal.html
Utah Retail For Lease. (n.d.). Retrieved from
https://www.cityfeet.com/cont/utah/retail-space-for-lease?sk=d9e7d10a8571447ab3fa1ad0f1e62758
IT Support Costs - Minneapolis, St Paul. (n.d.). Retrieved from ​https://www.imagineiti.com/it-support/costs/
Neutral Homepage. (n.d.). Retrieved from ​https://www.nationalgridus.com/Default.aspx
 Reflection

The importance of a BHR is to give a business owner or whoever is looking to

maybe start a business a plan in how much it costs to run a store using the cost centers
involved. The cost centers are the main ingredient when finding a BHR. They show you
how much you’ll need to budget and how much you should plan on spending on certain
necessities in a business. You add up all the cost centers to see what it would take to
run a business and how much those things are going to cost per year and divide them
by how many hours a year your business would be open. It seems like it would be pretty
obvious, but the more costs you have to run a business the more the budgeted hourly
rate(BHR) is going to be and the more you will have to either charge or the more it costs
to run a business per hour.

I actually really learned a lot from this activity. Me and my friends have thrown
around the idea of starting a sneaker store before and this kind of helped as far as
hypothetically what it would cost or things you would need to start something like that. In
my career path that I’m headed on right now I’m not sure it really helped me with
graphic design and what I plan on doing. It definitely showed me the cost to run a
business and how many things are per year. If i don’t plan on owning a graphic design
firm or printing press though the main examples that were used, don't necessarily apply
to me right now. I still really liked learning everything from the lecture and doing the
hands on, trying to figure out what things would cost, I thought that was really
interesting.

Most things weren’t too difficult. It was maybe a tad hard to find super accurate
information. For the most part I think coming up with things to run a sneaker store was
the hardest task, solely because I don't really know what it takes to run a business like
that. I had to use background knowledge and personal experiences in what I thought it
took to run a business of that sort. I think the most informative part for me was learning
how much things would cost and how much it takes to run a business through finding
the BHR. I had no clue what rent, utilities, licensing would cost for a business, it really
opened my eyes to how much it would cost.

I don’t think I have any questions about BHR at the moment.