You have a dream. It involves sequins, beads and feathers. Or maybe leather, silk and shoe polish. A clothing boutique is a perfect way to monetize your stellar sense of fashion — but starting a business can be intimidating. If you need help turning mood boards into moolah, we’re here to help.
Read on for everything you need to know about how to start a clothing boutique and how Incfile can make it easier.
Decide What Type of Clothing Boutique You’ll Open
First, think big-picture. This is your blank slate — let’s start filling it to begin bringing your dream to life. Here are the first things to consider:
Consider the Startup Costs and Profitability
Your business idea is crystal clear. Now it’s time to think about funding. After all, we’d prefer to see the “rags to riches” cliche played out versus your business burning a hole in your proverbial pocket.
How Much Can You Make as a Clothing Boutique Owner?
The average salary of a boutique owner is $57,010–$72,160 per year, according to Glassdoor and ZipRecruiter. Both sources cite upper-end salaries well into the six figures, from $200,000 to $450,000 and higher. With the right business model, your clothing boutique can be a money-making machine.
Choose the Right Business Model
No, not that kind of model — we’re talking retail, not runways. Your clothing boutique’s business model will determine who manufactures your products and how they’re shipped. Here are four models to consider:
Locate Your Suppliers
If you decide to go with a wholesale or private label business model, you’ll need to invest some time researching suppliers. While it may be difficult to choose from a vast array of suppliers, asking the following questions can help make sure you enter a partnership you feel good about:
Create Your Clothing Boutique Business Plan
Now that you’ve chosen a business model, you need to define how you’re going to run your clothing boutique, promote yourself and make a profit. Enter: Your business plan. It should cover the following:
Set Up Your Clothing Boutique Business Operations
It’s time to take the leap into setting up the logistics of your business. Below are the most important steps to tackle first:
Choose a Name and Register Your Domain
Your clothing boutique’s business name has to be memorable and special. Use our name search tool to make sure yours is unique. Once you’ve decided on a name, purchase your website domain name before it gets snatched up!
Choose a Legal Business Structure
Choose the right business structure to set yourself up for success from the get-go.
Register for an EIN
An EIN, or Employer Identification Number, is a must-have when opening a business banking account or applying for a line of credit. You may also hear this referred to as a business tax ID number.
Open a Business Bank Account
Your boutique’s business bank account will help keep business-related finances separate from personal finances. You’ll also start building your business’s credit score, which will be important if you want to take out loans later.
Look into Necessary Permits and Licenses
You will need to explore local, state and federal licenses and permits, particularly ones that are required to sell products online. Our Business License Research Package can help you do the legwork.
Determine Your Marketing Strategies
If you’ve got a knack for social media, now’s your time to shine! Marketing will be a huge part of your boutique’s growth, so you’ll want to get creative on how you promote yourself. Think live fashion shows on Instagram or mood boards on Pinterest for upcoming events.
Select an Ecommerce Platform
You’ll spend a large portion of your day-to-day administrative tasks within your ecommerce platform, so choose wisely! Some of the most popular ones for clothing boutiques include:
Set Store Policies
Will you accept returns if an item doesn’t fit or if it’s damaged? How many days after receiving their items will the customer have to return it? Will return shipping be on their dime or yours? These are all things you'll want to decide and communicate clearly on your website to avoid confusion or upset customers.
Consider Business Insurance
Even if your store is fully online, business insurance is an important part of protecting yourself from liability claims related to products you sell — like if a toddler swallows a button, for example. Look into different types of business insurance for your boutique, including:
Workers’ compensation insurance
If you plan on having employees, this protects your business from civil lawsuits from workers who become injured or ill on the job.
General liability insurance
Nearly every business can benefit from this coverage, which protects against injuries and property damage resulting from your products.
Maintain Your Business
The hard work is done! Now that your business is up and running, you’ll need to keep an eye on a few things to ensure operations continue to run smoothly.
File an Annual Report. We can file your Annual Report on your behalf.
Pay estimated taxes quarterly, typically in April, June, September and January.
Pay payroll and sales taxes on a regular basis.
Renew business permits and licenses.
Renew domain name and web hosting.