Whether you’re a clothing designer who dreams of seeing your designs on the rack, or just an enthusiastic entrepreneur looking to start a successful business, an independent fashion boutique could be a fantastic way to turn dreams into profit.
• The independent fashion boutique industry enjoys an annual revenue of over $27 billion
• Over 66,300 Americans are employed in one of over 34,500 fashion boutiques across the country
• Despite getting hit hard by the recession beginning in 2008, the industry has seen annual growth of 3.5% since 2009
Of course, like any business you consider starting or purchasing, opening a boutique takes a lot of research and planning. The competition is fierce, and standard brick-and-mortar stores have to compete with their online counterparts more than ever before.
Starting an independent fashion boutique
When it comes to startup capital, independent fashion boutiques are actually on the low end in comparison to many other potential startups.
The initial capital requirements are limited to the lease price on a storefront, any initial remodeling, supplies purchased or decorating required, and the purchase of the initial product stock that you’re going to sell. Add in a merchant account and POS software to handle your transactions, and you’re ready to open the doors.
This, of course assumes you’re selling someone else’s products. If you are setting up shop exclusively to sell your own designs and/or handmade items you’ve created, your initial stock may or may not require an outlay of cash on your part. What you don’t spend in purchasing your stock has probably already been paid in sweat equity, but it must be factored into the plan.
Necessary research before spending money
Since the actual financial requirements are relatively low, and there are no licensing considerations or other issues that create a high barrier to entry in this industry, another situation arises: incredible competition.
There are simply thousands upon thousands of independent fashion boutiques in operation. Customers tend to be loyal to their favorites, so setting up a “me too” shop that just melts in with everything else in the area is a recipe for disaster. On the other hand, there’s often room for a highly differentiated newcomer to jump in.
That being said, the overwhelming majority of new boutiques don’t survive their first year in business, generally because their competition was too strong.
To ensure your boutique beats the odds and succeeds, take the following important matters into consideration before you open your doors:
• Location – where can you set up shop that’s going to get plenty of traffic and eyeballs, while not being overshadowed by an established competitor?
• Product – How does your product line stand out as different from your competition? Is it actually different, or is it presented/priced/advertised in a new and different way?
• Design/Manufacturing – If you’re selling an exclusive design or brand, are you able to have sufficient stock manufactured at a reasonable price to satisfy customers while still maintaining a profit?
• Online – How are you going to compete online? Nearly every major brand and most independent boutiques have some level of eCommerce presence and your customers will expect that of you too. It doesn’t need to be incredible, but it does need to exist.
Running a successful independent fashion boutique
Once you’ve put sufficient time and energy into research and you’ve invested your initial capital in opening a brand new store or purchasing an existing boutique, you will need to focus on running the store profitably and strategically.
Following are several items to consider when running your store successfully:
• Staffing – While you may be able to start very small, even as a one-person shop, you will eventually need to hire some staff in order to achieve a sustainable work/life balance and maintain commercial hours your customers can rely on. Putting your store in someone else’s hands is a heavy responsibility, so choose wisely. You need staff that are reliable,
punctual, honest, hardworking and respectful of customers and merchandise.
• Purchasing – One of the toughest considerations for any retail store is purchasing of adequate stock to keep customers satisfied without overstocking items that never sell. It’s a hit-and-miss game for newcomers, and even veteran store owners sometimes misjudge. With online sales included, it can be very difficult to accurately predict what’s going to be popular and what’s not. Of course, if you’re designing and/or manufacturing your own products, this becomes even more important because you’re not just potentially wasting money, you’re also wasting time and effort.
• Fulfillment – Fulfilling a physical in-store purchase is simple because it comes right out of stock. But eCommerce is a necessary component in today’s retail fashion world, and keeping up with online inventory and fulfillment can be time consuming. Do you have a system set up to coordinate these two storefronts so that all your customers receive the products they want in a timely and courteous way?
• Customer Service – Serving your customers and making them want to come back is one of the most important things you can do to make your boutique successful. You must ensure that everyone who represents your store is kind, patient, and courteous to customers even if there’s a problem. Digital customers don’t deserve any less.
So, starting and running a successful independent fashion boutique can be exciting, fun, and profitable. But it takes thorough planning and research to make sure it turns out that way.
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