Many aspiring entrepreneurs dream of opening an online boutique. It seems to be easy to sell products online and make the business highly profitable. But, what are the steps to set up a digital boutique? In the case of offline boutiques in a locality, there are several potential challenges. For instance, boutique owners have to find a retail space and acquire business licenses. However, digital technologies have made everything easier, and entrepreneurs can start selling handpicked items to their customers. Still, there are many steps required to launch and market a successful online boutique. This guide also gives comprehensive details on how to fund a virtual boutique.
Decide on the entity type and select a business name
One of the most important steps for building an online boutique is to choose the boutique name and think of a proper business structure. Some boutique owners like to run the business alone, while others prefer a business partner. Aspiring bouquet owners can consider these options-
- Sole proprietorship- It is easy to set up this entity, as there is no need to register with the state where the business will be run. It ensures that the sole owner of the business will report his business earnings and losses on his personal tax return. However, the boutique owner will be responsible for any legal issues and debts.
- LLC- It is a flexible business structure separating personal assets from business liabilities.
- Corporations- Corporations are registered entities and provide limited liability protections.
To choose the right business name, it is essential to browse through the state’s digital business database. The business logo and name must not infringe on the intellectual property of another business. Make sure that the chosen boutique name is also available as the business domain name. When the domain name does not match the business name, it creates confusion among customers.
Develop your business plan and make your funding decision
Business plan development is an important step for building an online boutique. A detailed business plan covers many details.
- Company overview– This contains the basic information about the business and the products to be sold.
- Market analysis– A boutique owner needs to know about the market, the target audience, and competitors.
- Financial projections– The potential boutique owner must think of the ways of earning money and anticipate the costs of running the business. Based on these projections, the owner can apply for a loan from a bank and other financial institutions.
It is important to calculate the cost of starting an online boutique. The major costs involve-
- Costs for building a website– It includes the purchase of a domain name, web hosting, and e-commerce platform subscription.
- Inventory costs- The size of inventory can make a difference in the costs. The choice of products and vendors is important to have an estimate of the inventory.
- Shipping charges- Consider the available shipping options and their costs.
- Costs for a marketing campaign- Examples include PPC, SEO, and social media campaigns. These can be expensive so entrepreneurs need to plan for the cost.
Check the available loan options
There are multiple options for funding an online boutique.
- Business line of credit- These can be difficult to obtain for startups, unless secured with home equity or other persona assets.
- Startup business loan- Rollover for Business Startups (ROBS) is an effective plan to obtain business assets secured by a retirement account.
- Vendor financing– Online boutiques can sometimes secure a deal with their vendors to provide financing, but businesses must have a track record of excellent performance to qualify.
Start developing an online platform for the boutique
Some boutique owners think of hiring professionals to build the website. However, there are also DIY web builders with drag-and-drop tools. To create the digital platform for a boutique, the most important things are-
- Aesthetics of the design– Both free and paid themes are available to design and configure the store. The interface design must be modern, clean, and easily navigable to serve business needs. A mobile-friendly online boutique is important, as several customers like to purchase products from their mobiles.
- Branding of the boutique- The overall website design must reflect the brand values and brand personality. That is why the designer needs to focus on the font style, font size, and color scheme.
Other important elements include brand logo, email address, phone number, and social media profile links. When customers have any issues, they can contact the boutique owner. Some established online boutiques have live chat options.
- Create product listings– Properly organized products increase the chance of grabbing more customers. Moreover, product descriptions must include videos and images. Proper product categorization is also important for SEO purposes.
- Design a shopping cart– A well-designed shopping cart enables buyers to add items to the cart with a single click. Test the shopping cart to ensure that it works smoothly for both mobile and desktop users.
- Checkout page– Checkout is the last step of buying a product. For the checkout page, boutique owners have to decide on the shipping options and payment modes like Apple Pay, PayPal, and credit card.
- Create policies for the digital store– Every digital business has its own policies. Boutique owners must establish policies to let customers know how the business works.
Apply for business licenses and permits
Based on the type of business, online boutique owners may need Federal or state licenses. A business license, seller’s permit, federal tax ID, and sales tax license are important for setting up a virtual boutique. Business lawyers and accounting firms may also provide advice on these items.
Decide on how to source products for the boutique
Based on the products to be sold, the boutique owner has to contact vendors. Some sellers buy products from Etsy shops and resell them through their own boutiques. There are also local wholesalers selling products at an affordable price. Some boutique owners like to deal directly with manufacturers.
The process of setting up an online boutique can be complex, but it is also an exciting entrepreneurial venture that is accessible to most people looking for startup opportunities. With hard work and following the proper steps, this can quickly become an enjoyable and profitable venture.