If you're thinking of founding an online clothing business, now is the perfect time to start. The world's e-commerce market is set to grow in the years to come and is expected to reach a market size of over $672 billion by 2023. Want to get a piece of the pie? Find out how to start an online boutique clothing store below.
Laying the Foundation for Your Online Clothing Store
You don't need a degree to establish a successful online clothing store. Of course, if you want to design and sell your own clothing, knowledge of fabrics, sizing, and sewing is useful. In this case, some training is good. A fashion education will usually also cover other skills like merchandising and marketing. Here's a list of fashion schools if you're interested in this route.
However, a formal fashion education isn't a must to become a successful e-commerce retailer. In this field, a knowledge of what customers want, a well-organized e-commerce platform, and targeted marketing are worth more than a degree. Careful planning is the key to success. Follow this step-by-step guide to get started.
Define Your Boutique Store's Style
Online boutique clothing stores come in many forms. Defining your offering and target market is the first step to setting up your business. Here are some aspects to consider:
- Type of apparel: There are many niches within the fashion market. You could focus on formal wear, sports gear, everyday clothing for school or work, lingerie and loungewear, an outdoors clothing line, and more.
- Range of offerings: Some online boutique businesses sell only clothing. Others also sell shoes and accessories like belts, bags, and jewelry. If you aren't sure, you can always start with clothing items and expand to other goods later.
- Style: Within a defined type of apparel, there are still varied styles to consider. A person's style might be elegant and classic or more trendy and bold. You might help define your brand's style by identifying a celebrity whose fashion epitomizes the look you're aiming for.
Identify Your Ideal Customer
As you define your store's style, consider your target audience. Creating an imaginary customer profile can help. Do you want your online store to cater to a certain sex, age range, or style profile? Do they have any specific hobbies? Is your store supposed to cater to those pastimes in any way? For example, if you are starting an athleisure brand, you're presumably catering to athletic types.
The goods you'll stock if your target audience is teen girls will likely be very different from the goods you'll stock if your target audience is outdoorsy men and women in the 30-plus age bracket. Creating a mood board using Pinterest can help you create a visual presentation of your ideal customer's aesthetic.
Determine Your Production and Pricing Model
As you define your store's style and target customer, you should also think about pricing. Is your target audience primarily concerned about getting a good bang for their buck? Or are they willing to pay more for high-quality materials and craftsmanship? The production quality of your clothing will also impact pricing.
How will your clothing be produced? This is a big point to consider. You might:
- Craft apparel by hand. This is a great option if you have a talent for design and sewing.
- Employ local sewing experts in the production of your apparel pieces. This might be an option if you have a knack for design but aren't a great sewer yourself (or want to scale up).
- Outsource apparel production. Shopify explains how to find a supplier or manufacturer to make your vision a reality.
- Buy ready-made goods from designers or wholesalers. This is your best bet if you simply want to stock your digital store but don't have fashion design or production experience.
Your chosen production/acquisition method will play a factor in determining pricing. Your store's style and ideal customer will also play a part.
For example, let's say you plan to create custom-made formalwear (e.g., prom and bridal gear). Each piece is made-to-measure and handcrafted with high-quality materials like silk and lace. The price point per piece will likely be significantly more than if you are creating straightforward designs that don't require much tailoring or pricey materials (e.g., sweatpants and T-shirts).
Decide on an E-Commerce Platform
You can create your own independent e-commerce website to sell your clothes. However, it's also helpful to link up with online e-commerce platforms that allow you to set up a digital storefront at a low cost. Examples include BigCommerce, Shopify, Etsy, and WooCommerce. Amazon is another big-name option with broad reach.
Consider Your Overhead Costs
One of the great things about an online business is that the overhead costs are relatively low. For an e-commerce boutique, you have to factor in the materials and production costs for the clothing or apparel you plan to sell (whether you plan to craft clothing yourself or outsource craftsmanship).
Depending on your business model and size, you may also need to rent a commercial real estate property. If you plan to keep manufacturing in-house, you need a space to house production. There is also the cost of machinery and tools for production, e.g., industrial sewing machines and steamers. Also, keep in mind that you need sufficient space to store stock.
If you plan to hire employees, you need to account for their wages, as well. You might hire people to handle production and processes around production, like packaging, shipping, and customer service.
Beyond that, these are some basic startup expenses you may have to account for:
- Web design to set up your e-commerce shop and associated costs (e.g., graphics, SEO, product photos, etc.)
- Branding, advertising, and marketing expenses (paid online ads, social media, etc.)
- General business equipment like computers, phones, etc.
Finally, there are business license and insurance costs to consider. For example, if you have a commercial production space, you'll want to insure it. You can learn more about these points in the below section on business licenses and insurance.
Write Your Business Plan
With these steps checked off your to-do list, you can write a business plan. This is a comprehensive guidebook to optimize your business operations. You can also present your business plan to investors and lenders if you plan to seek external funding to get the startup capital you need. The U.S. Small Business Administration (SBA) provides templates to help you write your plan.
Opening the Virtual Doors of Your Online Store
There are a few more steps you have to take before you can formally open the virtual doors of your online clothing boutique.
Take Care of Registration, Insurance, and Tax Requirements
Register your business with the state to establish it as a legally recognized entity (such as a sole proprietorship, limited liability company, or corporation). Even if your state doesn't require such registration, it can be beneficial - offering tax benefits, protecting your personal liability, and differentiating you as a person from your business.
The requirements for registering a business will depend on the state. Regardless of where you're located, one step you'll have to take is to choose a name for your business. The formal business name will need to be used on all legal documentation (e.g., supplier contracts) going forward. It should also be on your branding materials, like your website domain name.
When registering your business, you should further determine whether your municipality requires additional licenses, permits, or insurances to open your specific type of business. For example, say you lease a commercial space for production purposes and storing stock. You will need to ensure the space is in compliance with health and safety codes. You will also want to insure your business space. Further, if you hire staff, you may be required to get workers' compensation insurance.
Finally, as you decide what business structure to establish, confirm the tax obligations of your chosen entity. The requirements of an LLC differ from those of a corporation, for instance. You want to choose the entity that will provide you with the most favorable tax situation. If you don't know what business model is best for you, talk to a business attorney.
Define and Disseminate Your Fashion Brand
An e-commerce store is a brand. Your brand should reflect your ethos and speak to your target audience. You want consumers to identify with your brand. Further, you want your brand to be reflected in every element of your marketing materials. Consistent use of color schemes, verbiage, visuals, and slogans is critical.
Take these steps as you define and disseminate your brand identity. This will serve as the basis of your marketing strategy to create a successful online boutique:
- Create a compelling logo. Your logo is a quick visual introduction to your brand. It's like a snapshot image for your company. You want it to be clear, easily recognizable, and memorable. If you aren't a graphic design pro yourself, you can hire a professional for an affordable price via a work-for-hire platform like Upwork.
- Design a user-friendly website. A well-organized website is critical if you're going to sell clothing online. If you're going to set up a digital boutique storefront via a platform like Shopify, it should also be well-presented and visually appealing. Great product descriptions and pictures are essential. You also want excellent functionality, with streamlined ordering, shipping, and payment options (credit card, PayPal, etc.). You can make your own platform with a website builder like Wix, WordPress, or Weebly or hire a web designer.
- Start your social media. Image-based social media platforms like Instagram and TikTok are a fantastic way to introduce your brand to the world. You can also use these tools to share news like deals. You can also create business profiles on sites like Google My Business to help expand your brand's reach and improve search engine ranking results online.
With these elements in place, you can start exploring different marketing techniques to boost your brand name further. From email marketing to pay-per-click (PPC) ads, there are many ways to promote your new business. You can also reach out to influencers. Check out these tips for boutique owners for inspiration.
Stay on Top of Your Growing Business
As your boutique clothing store gains recognition, you will gain new customers, boost your sales, and increase your profits. Make sure to keep up with growth by expanding and streamlining your day-to-day operations accordingly. Unfortunately, sometimes, small companies become victims of their own success because they fail to maintain quality in the face of greater demand.
Prioritize your time accordingly. For example, you might outsource tasks you used to do yourself, like social media posting, giving you more time to focus on overall management. You also might have to expand your customer service capacity with new technologies like chatbots. Technology can also help in other areas like inventory management.
Skynova can help simplify many aspects of e-commerce business management. You can manage invoices and track expenses using our accounting software. You can also rely on our business templates to simplify everything from monitoring purchase orders to issuing packing slips. Finally, if you're new to business financial management, Skynova's learning modules are a handy resource.
Build a Successful Fashion Brand With Skynova
Your dream of opening an online clothing store is probably driven by a passion for fashion - not a love of administrative duties. Skynova can help simplify money management for your business, saving you time and stress. Our templates, accounting software, and informational modules help small business owners succeed. Find out more.