In this article, Shreedutta Das pursuing Diploma in Entrepreneurship Administration and Business Laws from NUJS, Kolkata, discusses the licensing and registration process for opening a bookstore.
Books are lighthouses erected in the great sea of time. – E.P. Whipple
E.P. Whipple has rightly said that books are the lighthouses, books are the keys to the wide world and books are that friend of one’s life that never left them alone. Books inspire us to work hard with hope and courage.
Opening of a book store provides an opportunity to encourage knowledge and help people to get the desired book as well as a good source of income to the book store owner. One can also enjoy an excellent reputation as an important part of your local business community. Many booksellers make a significant impact on the city or town where they live. one could open a bookstore that becomes a town institution or a must-see for tourists.
According to a survey published in a popular newspaper says the average Indian is spending more than 10 hours reading books per week which puts India on top in comparison with other countries like China and the US. So opening a book store can be a profit making business in India.
Steps for opening a book store
Before starting any business its planning is important. Business planning serves as the backbone of any business. For opening a book shop one should first think of start-up cost, list of owners, location, market strategy, pricing scheme, projected profit and loss and etc.
Selecting a place for the book store
Finding a good place is really an important factor of opening a book store. Book store must be located a place where people could recognise the store and it should be away from the noisy traffic.
Books for the book store
A book store must have books of different genres for different ages of people. It should have book from fairy tales to non-fiction like The Man Hunt. Ordering books from suppliers and publishers are crucial. It is important to build contact with them.
Making the business legal
This means applying for a business license and deciding on your legal business form.
Advertisement of the store
One should advertise in the newspaper, in pamphlets, in social medias regarding the store.
Other offerings at the store
To make the book store more appealing, provision for café, book signing programme by authors, classes or seminar on any book, review of people on any book recording like things can be done.
In India establishing a book store does not need huge amount of investment according to a website there are two major areas of investment one is infrastructure and stocking of books. The lowest investment for opening a book can be rupees 50 lakhs
Some of the common legal steps
The most important step for opening a book store is legalising the business. In India, there is a very flexible way of legalising the business. Some steps can be –
VAT stands for Value Added Tax. It is a type of general consumption tax that is collected incrementally, based on the value added, at each stage of production and is usually implemented as a destination-based tax, where the tax rate is based on the location of the customer. VATs raise about a fifth of total tax revenues both worldwide and among the members of the Organisation for Economic Co-operation and Development.
A person doing business or a legal entity is eligible to apply for VAT registration. The unregistered dealer cannot charge VAT. The application for VAT Registration Number needs to be done with the specific commercial tax department of a particular state or local VAT Office, where the business is located.
The Tax Payer’s Identification Number (TIN) is new unique registration number that is used for identification of dealers registered under VAT. It consists of 11 digit numerals and will be unique throughout the country. First two characters will represent the State Code as used by the Union Ministry of Home Affairs. The set-up of the next nine characters may, however, be different in different States.
Trade mark is a visual symbol in the form of a word, a device, or a label applied to articles of commerce with a view to indicating to the purchasing public that they are the goods manufactured or otherwise dealt in by particular person as distinguished from similar goods manufactured or dealt in by other persons. A person who sells his goods under a particular trade mark in relation to those goods.
An office called the Trade Mark Registry has been established for the purpose of registration of trademarks, maintenance of the register and matter incidental to.
So one should register the unique name of the book store so that it can be distinguished from other stores.
IE Code stands for Import and Export code. All Importers who import goods into India require an IE Code. The IE Code must be quoted while clearing customs. Also, banks require the importers IE Code while sending money abroad. All Exporters who export goods or services from India require an IE Code. The IE Code must be quoted while sending shipments. And banks require the exporters IE Code while receiving money from abroad. Even individuals who are proprietors of a business can obtain IE Code in their name. It is not necessary to incorporate a business entity for obtaining IE Code.IE Code can easily be obtained from Directorate General of Foreign Trade (DGFT)within 10-15 working days after submission of the application along with all the necessary information. It is not necessary to show proof of any import or export to obtain IE Code.
Customers may want books of foreign authors which to be imported from foreign countries. In such cases IE code is needed to clear customs.
Under Shop And establishment act
One of the most important enactment is Shop and Establishment Act. A book store should be registered under this act.
This act provides that a commercial or trading or banking or insurance establishment or an establishment or administrative service in which persons employed or mainly engaged in office work, or a hotel, restaurant, boarding or eating house, a cafe or any other refreshment house or a theater, cinema or any other place of public amusement or entertainment.
The objective of the act is to provide statutory obligation and rights to the employee and employer in unorganised sector of employment and its most important work is to regulate the conditions of work and employment in shops, commercial establishments, residential hotels, restaurants, eating houses, theatres and other places of public entertainment.
This act provides that different state will have their own different legislation. Applicable to all persons employed in an establishment with or without wages, except the members of the employer’s family. State government can exempt, either permanently or for a specified period, any establishments from all or any provisions of this Act.
The definition of Shop include where goods are sold, either by retail, wholesale, or where services are rendered to customers. It includes an office a store-room, godown, warehouse or work place, whether in the same premises or otherwise, used in connection with such trade/ business
A shop does not include a factory, a commercial establishment, residential hotel, restaurant, eating house, theater or other place of public amusement or entertainment
This act lays down the following rules:
Working hours per day and week.
• Guidelines for spread-over, rest interval, opening and closing hours, closed days, national and religious holidays, overtime work.
• Rules for employment of children, young persons and women.
• Rules for annual leave, maternity leave, sickness and casual leave, etc.
• Rules for employment and termination of service.
• Maintenance of registers and records and display of notices.
• Obligations of employers as well as employees.
Registration process under the act
As a business owner of a shop or establishment, you are compulsorily required to get the same registered under the Shops and Establishment Act. Here are the specific rules:
- An application to be submitted in the prescribed form to the Inspector of the area within 30 days of starting any work in your shop/establishment. The application is to be submitted along with the prescribed fees and should contain the following information:
o Name as the employer and the name of a manager, if any;
o The postal address of the establishment;
o The name of the establishment;
o Such other particulars as may be prescribed.
- Upon receiving the application for registration and the fees, the Inspector shall verify the accuracy and correctness of the application. Once suitably satisfied, he shall enter the details in the Register of Establishments and issue a registration certificate of your establishment to you. This certificate will be valid for 5 years and has to be renewed thereafter.
- The registration certificate has to be prominently displayed at your establishment.
And in case of closure, the same has to be communicated to the authorities within 15 days from the closing of the establishment.
Books have a very crucial role to play in our life.Opening a book store is a very noble work as well as a profit making institution so before opening a shop one should be aware of the legal requirements to be fulfilled.