At a glance
Plan on about $416,000 before the first Utah sale
Canonical configuration: an independent, owner-operated, single 2,400-square-foot leased store selling computers, mobile accessories, smart-home products and gaming equipment, with limited setup/data-transfer services. The model assumes an Utah LLC, one site, roughly 900 active SKUs, 26 selling days per month and no carrier-authorized handset subsidy program or in-house component-level repair.
For this statewide 2026 planning model, required project cash runs from $230,000 Lean to $690,000 Premium; the practical Typical figure is $416,000. At stabilization, Base net revenue is $132,600 a month, normalized passive-owner cash operating profit before depreciation is $8,500 a month, and the working owner's pre-tax business cash benefit is $15,800 a month. The central caveat is inventory: rapid obsolescence and supplier terms can move liquidity needs faster than rent or filing fees.
The statewide occupancy basis is a planning basket, not an official average: late-2025 published asking rents for a major-market county and a fast-growing county, plus a lower-cost northern Utah public market assessment. The model uses $26 per square foot NNN and adds $7 per square foot for CAM, tax and insurance, producing about $6,600 monthly occupancy for 2,400 square feet. Evidence is moderate because leases vary by center quality, tenant improvement allowance and credit.
Startup capital
Inventory is the dominant use of opening cash
The Typical scope commits $178,000 to saleable inventory – about 43% of project cash. That is deliberately below a broad big-box assortment: the founder carries depth in fast-moving accessories and smart-home products, while using distributor availability and special orders for slower computers and displays. Opening inventory is shown once and excluded from the separate $8,000 net-working-capital line.
| Use of funds | Lean | Typical | Premium |
|---|---|---|---|
| Lease, utility and security deposits | $16,000 | $24,000 | $38,000 |
| Build-out, electrical, signage and fixtures | $48,000 | $91,000 | $168,000 |
| POS, security, demo and service equipment | $24,000 | $41,000 | $67,000 |
| Opening merchandise inventory | $86,000 | $178,000 | $303,000 |
| Fees, professional work, insurance and launch | $21,000 | $32,000 | $48,000 |
| Pre-opening payroll and training | $7,000 | $13,000 | $21,000 |
| Initial net working capital | $4,000 | $8,000 | $13,000 |
| Operating-cash reserve and contingency | $24,000 | $29,000 | $32,000 |
| Total project cash | $230,000 | $416,000 | $690,000 |
Takeaway: the Typical case is 60% of Premium cash because it limits showroom finish and inventory breadth while preserving the same core operating format.
No financing is assumed in the headline requirement. If a lender advances $140,000 against equipment and inventory only after invoices are verified, founder equity falls to $276,000, but peak interim cash may still approach $416,000 unless draws fund vendors directly. A landlord allowance should reduce permanent equity only when documented and collectible; it may not reduce pre-reimbursement cash exposure.
Operating economics
The store needs roughly 670 monthly tickets to support passive ownership
Base revenue is built from 680 merchandise transactions at a net average merchandise ticket of $174, plus 155 setup or data-transfer services at $60, and $5,000 of net commissions and delivery income. Sales tax collected from customers is excluded from revenue. Card fees are shown as variable expense rather than netted from sales. The merchandise mix produces a modeled 32% gross margin: accessories and services subsidize thinner-margin computers and branded devices.
| Driver or result | Downside | Base | Upside |
|---|---|---|---|
| Merchandise transactions | 520 | 680 | 830 |
| Average merchandise ticket | $166 | $174 | $181 |
| Total net revenue | $99,300 | $132,600 | $163,600 |
| Passive-basis contribution | $36,200 | $52,000 | $66,000 |
| Fixed cash costs incl. replacement manager | $43,500 | $43,500 | $43,500 |
| Normalized passive cash operating profit | – $7,300 | $8,500 | $22,500 |
| Working-owner pre-tax business cash benefit | $0 | $15,800 | $29,800 |
The owner-replacement role is fixed management, buying, merchandising and floor coverage – not unit-level repair labor. It is valued at $5,900 monthly salary plus 24% payroll and benefit burden, or $7,300 fully loaded. That amount is included once in passive fixed cost and added back once to calculate working-owner benefit. Draws and distributions are financing decisions, not P&L expenses.
| Cost category | Amount | Behavior and basis |
|---|---|---|
| Merchandise COGS and shrink/returns | $72,900 | Variable; 61.6% of merchandise sales |
| Card fees, service supplies and delivery | $7,700 | Variable with revenue and service mix |
| Non-owner payroll and burden | $17,900 | Mostly fixed within current capacity |
| Owner replacement manager | $7,300 | Fixed; passive view only |
| Rent, NNN/CAM and utilities | $8,100 | Fixed; state planning basket |
| Marketing, software and telecom | $5,600 | Fixed/discretionary |
| Insurance, security, maintenance and professional | $4,700 | Fixed; local quotes required |
| Total passive-basis cash operating cost | $124,100 | Before D&A, debt, income tax and maintenance capex |
Unit economics and resilience
Accessories and services must protect the blended margin
Merchandise ticket
$174 net revenue – $119 merchandise cost/shrink – $5 payment and fulfillment cost = $50 passive contribution, or 28.7%. No owner labor is allocated because the modeled owner role is fixed management.
Setup service
$60 revenue – $7 supplies/payment cost – $23 loaded staff time = $30 contribution, or 50%. The service bench has capacity for about 220 jobs monthly without adding labor.
Margin alarm
A two-point decline in blended contribution margin reduces monthly profit by roughly $2,650 at Base revenue. Track margin by category weekly, not only storewide.
The weighted passive contribution margin is 39.2% after all variable COGS, shrink, returns, payment fees, service supplies and delivery. The passive fixed-cost numerator is $43,500; therefore break-even is $43,500 ÷ 39.2% = $111,000 monthly revenue. At the Base mix this equals about 660 merchandise-equivalent tickets, or 25 per selling day. Current labor and service capacity can support the Upside case; beyond roughly 850 merchandise tickets or 220 bench services, another part-time sales/service position adds about $3,200 monthly and break-even must be recalculated.
| Measure | Result | Exact basis |
|---|---|---|
| Cash-survival break-even | $92,300/mo. | $36,200 non-owner fixed cash costs ÷ 39.2% contribution |
| Sustainable working-owner break-even | $111,000/mo. | Adds $7,300 target owner compensation; same 39.2% margin |
| Passive-owner break-even | $111,000/mo. | Fixed owner replacement labor is included once |
| Base opening-reserve floor | $15,000 | Minimum unrestricted closing cash |
| Modeled runway through ramp | 12+ months | Monthly cash schedule; reserve bottoms near $16,000 in month 5 |
| Base unlevered project payback | 34 – 41 months | Month-0 $416,000, ramp cash, $1,200 monthly maintenance capex, NWC changes |
The payback range reflects the first cumulative month at or above zero under a monthly schedule, not the shortcut of project cost divided by stabilized profit. It is pre-tax and unlevered. Downside does not repay within 60 months without a turnaround; Upside repays in about 24 – 29 months. Financing would require a separate founder-equity schedule using actual debt service and distributions.
Decision threshold: do not sign a long lease until supplier terms and a category-level margin plan support at least $111,000 of monthly net revenue without requiring utilization beyond the current staff and service bench.
Permissions and critical path
Site approval and tenant work – not the LLC filing – set the opening date
Utah formation and tax registration can run while the founder negotiates the lease, but the lease should remain contingent on zoning, permitted retail use, signage rights, electrical capacity and certificate-of-occupancy requirements. A retailer with an established Utah presence must hold a Utah sales-tax license; tangible electronics sales are generally taxable. Address-specific combined rates must be configured in the POS, and collected tax remains a liability rather than revenue.
| Requirement | Authority | Cost / timing | Dependency |
|---|---|---|---|
| Utah LLC organization and annual renewal | Division of Corporations | Official fee schedule; renewal $18 annually | Required before contracts/banking in LLC name |
| EIN | IRS | $0; online availability varies | Payroll, bank and supplier setup |
| Utah sales-tax license | State Tax Commission | Confirm current processing; apply through TAP/OSBR or TC-69 | Needed before taxable retail sales |
| Employer accounts and workers' compensation | Utah agencies / insurer | Premium quote required | Coverage before employees begin work |
| Zoning, building, fire, occupancy and sign approval | City/county | Varies by city/county; local quote required | Address and plans; critical path |
| Local general business license | City/county | Varies by city/county | Often follows use/occupancy approval |
Local variation and address checks
Use at least three local confirmations before committing capital. Salt Lake City, Provo and St. George each administer business licensing and land-use/building functions locally, but the forms, fees and inspection sequence are not statewide law. Confirm permitted retail use, change-of-occupancy triggers, fire review, sign permit, low-voltage/security work, parking and whether a county or special district adds a requirement. The model carries $9,000 for permits, design and professional coordination; it is a modeled allowance, not an official statewide fee.
Utah demand and risk
Growth supports demand, but online substitution disciplines price
Utah had an estimated 3.54 million residents in July 2025, up 8.2% from the 2020 estimate base, and 93.4% of households reported broadband subscriptions in 2020 – 2024. Median household income was $95,166 in 2024 dollars. Those are demand proxies – not electronics market revenue. A reliable Utah market amount is not publicly determinable from the available category data because current state retail receipts do not isolate this store's chosen assortment, services and e-commerce leakage with sufficient precision.
Inventory aging
Line at risk: COGS and working capital. Monitor inventory older than 90 days, sell-through by SKU and vendor return rights. Trigger markdown action before aged stock exceeds 12% of inventory.
Margin compression
Line at risk: contribution. Watch weekly gross margin by category and price-match frequency. A 2-point margin loss removes about $31,800 of annual Base profit.
Traffic shortfall
Line at risk: revenue and payback. Track transactions per open day, conversion and average ticket. Below 24 daily equivalent tickets, passive break-even becomes unlikely.
Utah's statutory minimum wage is $7.25, but it is not a realistic hiring budget. The statewide May 2023 BLS median for retail salespersons was $15.86 an hour and for retail supervisors $22.66; the model uses $18 – $21 for sales/service staff and a $5,900 monthly manager salary, then adds payroll burden. Published late-2025 retail asking rents showed tight conditions and substantial differences among in-state markets. This combination makes labor, occupancy and inventory turns more useful sensitivity levers than the low statutory wage.
A viable store wins on curated availability, advice, setup and immediate fulfillment. If the address cannot generate 26 daily tickets at the modeled mix – or if the assortment cannot hold roughly 49% total contribution after COGS and variable costs – the founder should shrink the footprint or use an appointment-led showroom before adding capital.
Sources and method
What is observed, official and modeled
Research was reviewed August 29, 2026 and expressed in 2026 planning dollars. Official rules and fees are used directly where published. Wages and population are reported government data. Rent is a disclosed three-market-type planning basket; build-out, insurance, inventory, price mix, shrink, conversion and launch duration are modeled assumptions that require address-specific quotes and supplier validation. The largest uncertainty is category-level gross margin after markdowns and online price matching.
The operating cases hold the Typical footprint, hours, service bench and staffing capacity constant. Revenue is earned when goods transfer or services are delivered; customer deposits and sales tax are liabilities until earned or remitted. The cash schedule assumes mostly same-day card collection, distributor invoices paid on 15- to 30-day terms, inventory turns that improve during the first six months, and no owner distribution until the closing cash balance clears the $15,000 floor. Depreciation is not estimated because asset lives and tax elections are not yet supportable, so the profit measure is normalized cash operating profit before D&A – not EBIT or guaranteed take-home pay. Maintenance capex appears below operating profit in the payback schedule, while opening fixtures appear only in startup uses.
| Source / publisher | Geography / period | Evidence type | How used |
|---|---|---|---|
| Utah Division of Corporations fee schedule | Utah; effective July 2024 | Official fee | Entity filing framework; verify current fee at filing |
| Utah annual renewal instructions | Utah; current page | Official rule/fee | $18 LLC annual renewal |
| Utah Tax Commission Publication 25 | Utah; current publication | Official rule | Sales-tax license and retailer treatment |
| Utah Labor Commission wage guidance | Utah; reviewed 2026 | Official rule | $7.25 statutory minimum wage |
| Utah workers' compensation guide | Utah; current | Official rule | Coverage before employing staff |
| BLS Utah OEWS | Utah; May 2023 | Reported government data | Sales and supervisor wage anchors |
| U.S. Census Bureau QuickFacts | Utah; 2020 – 2025 | Reported government data | Population, growth and income proxies |
| Colliers retail market reports | Multiple Utah markets; Q4 2025 | Published benchmark | State planning basket for asking rent |
| Utah consumer-protection guide | Utah; current | Official guidance | Recurring plan and disclosure gate |
| Utah electronics recycling statute | Utah; amended 2025 | Official statute | Manufacturer reporting and retailer take-back context |
This planning article is not legal, tax, lease or investment advice. Confirm the final address, current agency fees, taxability of each revenue stream, supplier economics, insurance, local approvals and contract language before committing capital.