How-to guides
How to Start a Hardware Store: Registrations, Range and Credit to Contractors
A hardware store carries thousands of small items, sells by the piece, the kilo, the metre and the box, delivers heavy goods to sites, and gives credit to contractors who pay when their client pays. The registrations are simple. Stock and credit are where the work is.
Key takeaways
- Most hardware goods are at 18% GST; cement moved from 28% to 18% on 22 September 2025.
- Deliveries above ₹50,000 to sites in another state always need an e-way bill; within the state, your state's limit applies.
- Contractor credit is the biggest risk: set limits and get running statements signed.
- Units matter: decide whether each item is stocked and sold by the piece, the box, the kilo or the metre, and keep it consistent.
Registrations checklist
| What | Who needs it | Where |
|---|---|---|
| GST registration | Compulsory above ₹40 lakh turnover of goods in most states; contractors and builders expect a GSTIN for input credit | gst.gov.in |
| Shops and establishments registration | As required by the state Act | State labour department portal |
| Trade licence | Where the municipality requires one | City corporation or municipality |
| Weighing scale verification | If you sell nails, wire or other goods by weight | State Legal Metrology department |
| Storage safety | Paints, thinners and adhesives are flammable; follow fire safety advice for storage | Local fire services |
| Udyam registration | Optional and free | udyamregistration.gov.in |
Checked on 11 November 2026 against the CGST Act, Notification 10/2019-Central Tax and the Legal Metrology Act, 2009.
GST on hardware
Most hardware, tools, fittings and electricals are at 18%. Cement was cut from 28% to 18% from 22 September 2025, and some building materials such as certain stone blocks and sand-lime bricks moved to 5%. Check each item's HSN; a hardware shop has more rates in its catalogue than most retailers.
Builders and contractors registered under GST will want B2B invoices with their GSTIN and the delivery site address. If the site is in another state, the place of supply is that state and IGST applies.
Deliveries and e-way bills
Goods worth more than ₹50,000 moving to another state need an e-way bill, whatever the purpose. Within a state, the limit is set by the state: ₹50,000 in Karnataka, ₹1 lakh in Maharashtra or Tamil Nadu, for example. A truckload of cement and steel almost always crosses it. Keep the delivery challan or invoice with the driver, along with the e-way bill number.
Setting up the first month
- 1Group items by category (plumbing, electrical, tools, fasteners, paint) so the catalogue is searchable.
- 2Set units carefully: if you sell screws singly, enter the 100-screw box as 100 pieces when it arrives; sell wire by the metre or by the coil, not both.
- 3Record opening stock and give each item a rack location so staff can find it.
- 4Set a credit limit and payment terms for each contractor, and record every delivery against an invoice or challan.
- 5Decide who can give discounts and how much; hardware counters see a lot of bargaining.
- 6Plan a weekly cycle count of fast-moving and high-value items.
The numbers to watch
| Number | How to work it out | Why it matters |
|---|---|---|
| Contractor outstanding and ageing | Total owed by each contractor, split 0–30, 31–60, 61–90, 90+ days | The biggest single risk in the business |
| Dead stock | Items with no sale in 180 days, at cost | Hardware ranges collect slow items fast |
| Gross margin by category | Separate for cement and steel, fittings, tools, paint | Bulk materials earn little; fittings earn more |
| Discount given | Discounts ÷ sales, by staff member | Uncontrolled bargaining eats margin |
| Stock count differences | Counted vs system, for the weekly cycle count | Small items walk out unnoticed |
Common mistakes
- Contractor credit without limits, signatures or statements
- Units set wrongly, so stock shows 1 when there are 100 pieces
- Delivering to another state without an e-way bill or with CGST/SGST instead of IGST
- Keeping old cement or paint stock past its useful life
- Not recording goods sent to site on approval
Where TripleBill fits
TripleBill handles B2B and B2C invoices with GST from the place of supply, customer credit limits with receivable ageing, delivery challans, and e-way bill details recorded against invoices (the e-way bill itself is generated on the portal). Racks and shelves with rack labels and a stock-take sheet are on Pro; barcode labels on Starter and above.
Frequently asked questions
What is the GST on cement?
18% since 22 September 2025, down from 28%.
Do I need an e-way bill for site deliveries?
If the consignment value exceeds ₹50,000 for inter-state movement, or your state's limit for movement within the state, yes.
How do I manage contractor credit?
Set a limit for each contractor, record every delivery against a bill, send monthly statements and stop supplies when payments fall behind the agreed days.
Do I need a licence to sell paint?
No special licence, but store flammable goods safely and follow local fire safety advice.
How do I handle items bought by the box and sold by the piece?
Keep the item in the unit you sell, and enter each box received as its number of pieces on the purchase bill, so stock and cost per piece stay right.
About the author
Written by the TripleBill team, the people who build the billing and accounting software this site is about. We check competitor prices on their own websites on the date shown above, and we say so when our product is the weaker choice. This article is general information, not tax advice.
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Thousands of items, one counter.
Billing, stock, credit limits and delivery challans in one place.