After you've collected all of these materials, head back Animal Crossing Bells to Residential Services and give them to Timmy. In return, he'll allow you to pick the location for the new shop.

Now you just have to wait a day for the shop to be built!

How to upgrade Nook's Cranny in Animal Crossing: New LOLGA.COM Horizons
While having a proper shop on your island in New Horizons is great, you might, after a while, find yourself rather limited by what stock Tommy and Timmy have on offer. Luckily, Nook's Cranny will, eventually, have a renovation.