How much it costs to open a shop in the UK

Opening a 600 square foot shop in the UK costs roughly £28,000 to £78,000 before you take a pound over the counter, most of it the fit-out and getting into the lease, then about £39,100 to run for the first year with one full-time member of staff.

Four lines take most of that money. Getting into the lease and fitting the shop out land before you trade; stock and staff keep coming every month. Everything else – energy, insurance, card fees, a till, waste – is smaller and easier to change once you are open. When we asked 1,005 small business leaders what worried them most about 2026, 47% said rising day-to-day operating costs, ahead of economic uncertainty at 44%. These are the lines where that pressure lands.

Every figure below is worked on the same unit, so you can see where it comes from:

• a 600 square foot shop in England
• one full-time member of staff
• rent and rateable value at the national retail average

Swap your own numbers in as you go. The rates and thresholds here were checked on 14 October 2026, and the Autumn Budget on 28 October 2026 may move some of them.

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Rent, and what the landlord wants before you get the keys

Shop rent is quoted per square foot per year. The nearest thing to an official UK figure is the Valuation Office's mean rateable value for retail property: £145 a square metre at 31 March 2025, or about £13.47 a square foot. On 600 square feet that is £8,100 a year.

Rateable value is an estimate of open market annual rent, so treat it as a starting point rather than a quote. A prime high street will be a multiple of it and a side street a fraction, and if you are not wedded to a location that gap is worth researching before you fall for a unit. You can also look up the rateable value and floor area of the exact unit you are considering before you speak to the agent.

Then there is what the landlord wants before the keys change hands: a deposit of three to six months' rent, which is £2,000 to £4,100 on a unit at £8,100 a year, a quarter's rent in advance, so another £2,000, and your own legal and survey fees, which are quoted rather than published.

Two parts of a shop lease cost more than they look. The first is the schedule of condition. Most commercial leases make you responsible for repairs, and without a dated photographic record of what you took on, you can be billed at the end of the lease for wear that was already there. A survey costs hundreds; a dilapidations claim can cost thousands.

The second is the personal guarantee. A young limited company has little trading history, so landlords commonly ask a director to guarantee the rent personally. You can often negotiate that down to a fixed sum, or to a period that ends once you have paid on time for a year or two – but ask before heads of terms are agreed, because it is much harder to move afterwards. If you are still weighing up locations, choosing business premises covers the trade-offs beyond the rent.

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Business rates: many small shops pay nothing at all

Business rates are billed by your local council, and the rateable value behind the bill is set by the Valuation Office – its estimate of what your unit would have rented for on 1 April 2024. HMRC has no part in it.

Many small shops never pay any. Small business rate relief wipes the bill out completely if your rateable value is £12,000 or less and that is the only property your business uses. Between £12,001 and £15,000 it tapers away, and GOV.UK's own examples give you 50% off at £13,500 and 33% off at £14,000.

Above the taper, the bill is your rateable value multiplied by a figure the government sets each year. From 1 April 2026 shops have two multipliers of their own, set 5p below the national ones and made permanent: 38.2p in the pound below a rateable value of £51,000, and 43p from £51,000 up to £499,999. They replaced the old retail discount, which closed to new claims on the same date, and unlike it they have no cash cap. If your unit is not treated as retail for rates, the small business multiplier of 43.2p applies below £51,000 and the standard multiplier of 48p at or above it – your council decides which, so ask rather than assume.

Put the relief and the multiplier together and the bill moves in steps rather than a straight line:

The unit in this page's figures has a rateable value of about £8,100, so its rates bill is nothing - the single biggest saving in the whole budget, and one decided by which unit you sign for rather than by anything you do afterwards. Once you know a unit's rateable value you can estimate its bill yourself. And if the revaluation on 1 April 2026 pushed yours up, supporting small business relief caps the rise at £800 or your band's percentage cap, whichever is greater.

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Fitting out the shop

The fit-out is the biggest single cheque most new shops write, and the one you control most. Shopfitting contractors publish their own cost guides, and two of them agree on roughly the same envelope: about £40 to £70 a square foot for a basic fit-out, £75 to £120 for mid-range, and £125 to £200 and above for a high specification. On 600 square feet, here is what each one buys.

No government body collects fit-out costs, so those are trade figures rather than official statistics: Retail Construction Contractors' guide dated 22 May 2026, with a matching £300 to £1,500 a square metre range in New Look Shopfitting's 2026 guide. Only a quote on your own unit will settle it.

Two things usually sit outside that quote. The shopfront is normally priced separately and is worth treating as its own decision, because it is the part a passer-by sees and the part most likely to need the council's consent. And the landlord will charge their own legal and surveyor fees to approve your plans, so ask what a licence for alterations costs before you budget the works.

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How much stock to open with

Judging your first stock order is hard, because you have no sales figures to back you up. No average helps either: a card and gift shop can open on a few thousand pounds, and a convenience store with chillers cannot. What matters more than the total is how fast each line sells, because that is what turns an opening order back into cash rather than shelf space.

So open with the narrowest range that still looks like a shop. Stock is the one big cost you can adjust after you open, and your first order decides how long your money sits on the shelves. Four things to settle before you place it:

• Agree payment terms with suppliers, so the first order is not all cash up front.
• Check minimum order quantities, which often force you to buy deeper than you want.
• Keep a reserve for repeat orders of whatever sells, rather than spending it all on range.
• Record what sells from week one, so the second order is better than the first.

Retail demand planning covers how to forecast what you will need, and inventory management how to keep it under control once you are trading.

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What one member of staff costs

Staff is the line that repeats, and the one most first-time employers underestimate, because the wage is not the whole cost. Here is one full-time shop assistant aged 21 or over, on 37.5 hours a week from 1 April 2026.

The Employment Allowance is the part most new employers miss. It takes up to £10,500 off an eligible employer's National Insurance bill each year, which for a shop covers roughly the first three full-time staff, and the £100,000 payroll cap that used to limit it was removed in April 2025. A company whose only person on payroll is a single director cannot claim it, so check with your accountant. Employer National Insurance for small businesses goes through the rates, the thresholds, and who qualifies.

Younger staff cost less an hour – £10.85 for 18 to 20-year-olds, and £8 for under-18s and apprentices in their first year. You have to enrol anyone earning £10,000 a year or more in a workplace pension, where the minimum total contribution is 8% and at least 3% of it is yours.

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What arrives every month once you are open

Energy is usually the biggest monthly bill after rent and staff, and it is the one with no safety net. Electricity for the smallest business users – below 20 MWh a year, which is where a small shop sits – averaged about 38p a kWh in the second quarter of 2026, excluding VAT, so a shop using 15,000 kWh a year would pay roughly £5,700. Ofgem is explicit that the price cap does not protect a business energy contract, so fix your rate before you open and compare the standing charge as well as the unit rate. Efficient lighting and a door that actually closes pay back faster in a shop than in most premises.

The rest of the monthly bill:

• Card fees. Interchange on UK consumer cards is capped at 0.2% on debit and 0.3% on credit, but that is the floor rather than your rate. You pay the merchant service charge: interchange, plus the card scheme's fee, plus your provider's margin, and the last two are not capped. The Payment Systems Regulator found that for merchants taking under £15,000 of card payments a year, average interchange fell 0.19 percentage points while their charge fell only 0.03. Ask your provider to break the rate down by card type, which they have to do.
• A till, software, and connectivity. The terminal and card reader are one-off hardware; the software and your accounting package are monthly subscriptions. Budget a business broadband line rather than a consumer one, and check what the terminal contract ties you into – that is the usual reason a shop cannot switch provider.
• Trade waste. Shop waste cannot go in a household bin. You need a registered waste carrier, a waste transfer note for every collection, and food waste kept separate from dry recycling.
• Marketing. Window graphics, a launch, local advertising, and packaging. Treat it as a line you can turn up or down, not a fixed share of a revenue you do not have yet.

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The insurance you have to have, and the insurance you choose

One cover is compulsory. From the day you take on your first member of staff you need employers' liability insurance for at least £5 million, from an authorised insurer, with the certificate where your staff can see it. Everything else is a judgement call, and all of it is priced on quote – no official source publishes average premiums for a shop, so treat any figure you see quoted as a guess.

What you will be offered:

• Employers' liability – claims from staff injured or made ill at work. Compulsory once you employ anyone.
• Public liability – claims from customers hurt on your premises or by your displays.
• Product liability – claims about the things you sell.
• Stock and contents – theft, fire, flood, and the plate glass in your shopfront.
• Business interruption – the income you lose while you cannot trade.

Get two or three quotes on the same specification and compare the excesses, not only the premiums. Shop insurance goes through what each cover does.

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What year one adds up to

Put the sourced lines together for the unit this page has been working on, and here is the shape of it.

Three things stand out. The fit-out is the biggest single cheque and the one you control. Business rates can be nothing, decided purely by which unit you take. And staff is the line that repeats, so the gap between part-time and full-time cover compounds every month.

What the table deliberately does not give you is an average. Three lines can only be settled by a quote – opening stock, insurance, and legal fees – and they vary so much with what you sell that a single national figure would mislead you rather than help. It is also why the figures circulating online for the average cost of opening a shop contradict each other.

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How to bring the bill down

The biggest saving here is not a negotiation. Find a unit with a rateable value of £12,000 or less and your business rates go to nothing, which on these figures is usually worth more than everything else you could argue for put together. It is settled before you sign, which is the point: the cheap decisions are the early ones.

After that, three terms in the lease are worth arguing over:

• A rent-free period that covers the fit-out. Landlords commonly expect to give some, and every month of it is a month's rent you do not pay on a shop you cannot trade from.
• A cap on the service charge. In a managed parade an uncapped service charge is an open-ended bill on a budget you have only just balanced.
• A cap on the personal guarantee – a fixed sum, or one that falls away after a period of paying on time.

Three more things are worth a phone call: whether the revaluation pushed your rates bill up, because supporting small business relief caps that rise; your energy rate, fixed before you open rather than after; and a second card-processing quote. Small business grants are not a reliable line in a budget, but a local growth hub or high street fund can cover a shopfront or a piece of equipment.

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Buy stock before your busiest months

Your biggest stock order lands months before the sales it pays for. In most shops that gap is about timing rather than profit: the autumn range is bought in July and sells through November, and the money has to come from somewhere in between.

Chris Billingham runs Muscle Squad, which holds around £500,000 of stock and borrows the way a seasonal shop has to.

'We go through waves of borrowing a significant amount and paying back a significant amount,' he says. 'You need the conviction that a good period is only around the corner.'

How much you can borrow is typically up to around 20% of your annual turnover, depending on turnover, trading history, and performance. If you would rather fund stock against the stock itself, inventory finance works differently and suits shops with predictable sell-through.

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Opening a shop: common questions

Do I need planning permission to open a shop?

Usually not, if the unit was last used for something similar. A shop is use class E in England, so taking over a unit last used for another class E purpose – an office, a café, a clinic – is not development.

Work on the outside of the building usually does need permission, and a listed building or a conservation area changes the answer, so check with the council before you sign.

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Do I need consent for a shop sign?

Often yes, and it runs through a separate regime from planning permission. A fascia sign and one projecting sign have deemed consent within set limits on size, projection, and height.

Beyond those limits, or for anything illuminated in a conservation area, you need the council's express consent. Displaying a sign without it is a criminal offence, so it is worth a call.

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What tax do I pay on the lease itself?

Usually none on the rent, but check both taxes before you sign. There is no stamp duty land tax where the net present value of the rent is £150,000 or less, which covers most small shop leases.

A return is still due within 14 days of completion even when the tax is nil. Commercial rent is also normally exempt from VAT, unless your landlord has opted to tax the property, in which case 20% is added to the rent and the service charge – a cost you cannot reclaim if you are not registered for VAT.

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How long does it take to open a shop?

Allow three to six months from starting your property search. The lease and the fit-out take most of it, and the two stages you cannot compress are the landlord's solicitors and the council, if the shopfront needs consent.

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What does it cost to open a convenience store?

The higher end of every range on this page. The opening stock order is larger, chillers and shelving push the fit-out towards the mid-range and high figures, and the electricity bill is bigger because the chillers never switch off. The lease, rates, and staff lines work the same way.

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