According to Statista, global retail e-commerce sales would grow to $4.5 trillion by 2021. More than ever now’s the right time to know how to start an online boutique.
To get things rolling, I have created a super easy guide on how to start an online boutique, even if you’re someone with zero experience. This post is dedicated to just that, and it explains all that you need to do in 7 simple steps, as well as some legal documentation that might be useful.
In this guide, we have discussed the step-by-step process for starting an online boutique in a matter of minutes. I have also covered the legal aspects of an online boutique.
Let’s get started!
How to start an online boutique
Step-1 Find best sellers in clothing and accessories
This is the most important step on my guide on how to start an online boutique, so please read it carefully.
1.1 Choose your niche – kids clothing or watch collection?
When it comes to starting an online boutique there is a variety of clothing and accessories that you can sell. Try to narrow down your product categories and target audience in the beginning. For instance, if you want to sell kids clothing, target it towards a particular age group. If you are selling swimwear, again select target age and men/women category. You can then further categorize it into sub-categories based on design type.
If you are thinking of selling clothing accessories, you can select:
Single niche store like Watch boutique (sub categorized into analog watches, digital watches, etc) or multi niche store, selling more than one of the boutique accessories.
1.2 Perform market research and pick best selling products
Right off the bat, you need to start working on a product that has low production cost, a good margin and a high demand. Find out what’s trending in your niche?
Use Google advanced search to find the exact match (“product, Corona fashion”) for your online boutique. Additionally, Shopify and other platforms keep featuring best selling products for every month. Like, in the beginning of the Corona pandemic, the most trending fashion product was high waist shapewear. Amazon fashion category is also a great place to know what’s selling.
Try to optimize your products for what’s selling at that moment. For example, many online brands customized their post Corona products line. Try to keep your online boutique niche specific in the beginning for better conversion rate and higher return on investment (ROI).
Use keyword research tools like Semrush or KwFinder to check the search rate and search volume for the products (keyword) that you are going to sell. This will help you narrow down the product catalogue.
1.3 Do a quick analysis for target market
Before you start selling, it’s always good to perform a rough analysis, so you know if there is a demand for your product or not?
- Think about a relevant customer base – Think about who is most likely to buy this product? Is there a bigger brand to compete?
- Check your customer base – Perform a quick analysis to find out how big your customer base is. Apparel market alone contributes to 1.5 billion US dollars. Similarly, you can use platforms like Statistia and other credible sources to see how big your audience is.
- Analyze your product service – You will be creating a high quality clothing and accessories that looks professional (and fashionable) and actually helps your customers.
- Specify demographics – Try to figure out a demographics report featuring age, location, gender, occupation, income, etc about your target audience.
Step-2 Choose your business model
Once you know the target market and the type of clothing you are going to sell, you can go ahead with your business model. You have to be careful about the business model you choose during the time of Corona. By that I mean, try to look for a supplier that is closed to your target market.
Target regional audiences/specific locations with less shipment restrictions. Going ahead with the business model for your online boutique, you can choose any on the three options:
a. AliExpress dropshipping model
Dropshipping is a business model where the wholesaler directly transports the clothing accessory listed on your online boutique to the customer. The good thing about dropshipping is that you will pay your supplier on a per order basis.
For instance, if you start an online boutique with Shopify. You can use the free Oberlo app for moving the product details from the supplier (say Aliexpress) to your store. Oberlo will not only help you handpick the best sellers but also to dropship them for a minimum charge. Dropshipping doesn’t require you to make an upfront payment or manage stock. Alternatively, you can also choose Kole Imports for U.S. based audience.
b. Inventory based model
The inventory model is a fit if you have good capital. You will be buying bulk products from wholesalers and then selling it on a per order basis. The seller would need to set up a wholesale account along with a complete credit application (will get into it). You will also need to find a good quality eCommerce shipment service like ShipBob.
c. Print-on-demand model (for both dropshipping and inventory)
Print on demand is a type of business model that allows you to customize, design your clothing via a mockup generator.
Your print on demand supplier will then manufacture the products for you. This gives you both design flexibility and cost-effective production. There are both bulk wholesale orders and dropshipping options available on the print on demand sites. You can further decide the print method for your clothing:
When it comes to print on demand there is a huge variety of sublimation printing methods. Two of the most seen sublimation printing methods are dye sublimation (where the design is infused with the product surface) and digital printing (where the print remains on the material).
To cut it short, it is a printing method that offers quick turn around, higher-margin, print-design flexibility, and faster shipments. There are services like Printful, Printify, and many more for this type of business model.
Cut & sew
Cut & sew are pieces of colored fabric cut to shape and sewn together to create your garment. Instead of printing fabric, it is customized from raw fabric to give your clothing an aesthetically appealing, fine design. You can either work with cut & sew manufacturers like Contrado or print on demand and fulfillment services like Printful.
Stitching is when the thread loops are crafted on clothes to give your boutique products a unique design. Embroidered stitching is one of the most common among all. Stitching is for those who want to offer handcrafted clothing line on their online boutique. You can go to platforms like Apliiq for stitching products.
White labeling is for those who want to have their brand name tagged on their clothing products. You can either choose print-on-demand services, or private label manufacturers; based on your business needs.
Step-3 Find a reliable supplier
Unless you manufacture your own products, you will need to find a supplier for your online boutique. You can select one of the following
- Dropshippers – Supplier ships goods directly to the customer on a per order basis. You can find dropshipping suppliers via AliExpress, Alibaba or use dropshipping directories like SaleHoo.
- Wholesalers – Wholesaler buys the product from the manufacturer and sells it to the retailers for a slightly higher price. You can find a wholesaler by using Google string – “wholesale supplier”. Alternatively, look for online wholesale directories and tradeshows. You will need inventory for this.
- Manufacturers – This type of model is product-supplier is good for those who want to make a serious investment and store a large inventory. You can check credible local or overseas manufacturers or use platforms like TradeIndia for this purpose.
- Private labeling manufacturers – In this arrangement your manufacturer will create a product from scratch and put your brand name on their products.
In a pandemic (or even a non-pandemic) situation, it is necessary that you select a supplier that can persistently provide high quality products. You need to ensure that what you are selling is the best product available in the market.
You can use directory services like Worldwidebrands, Salehoo, Alibaba, etc to find certified suppliers from around the world. Alternatively, use “eCommerce clothing suppliers” and similar keywords on Google search engine.
Be sure to thoroughly investigate your wholesale supplier, as well as verify the manufacturer details and access the brand reputation of your supplier. This can be done through their Google ratings, BBB+, online reviews and so on.
Step-4 Select an eCommerce platform
There were a lot of eCommerce platforms like Shopify, WooCommerce, BigCommerce, Magento, etc for our how to start an online boutique guide. But these are my top picks:
- Shopify (dedicated eCommerce platform) – Shopify is a complete eCommerce solution. They have thousands of apps for improving different aspects of your boutique. Although you can use Shopify for both the inventory as well as dropshipping, their features are more targeted towards dropship stores.
- WooCommerce (WordPress plugin) – It is an eCommerce plugin for WordPress that helps a user to create an online store. WooCommerce is not good for dropshippers, but definitely a great choice for inventory models. The only reason for choosing WooCommerce over Shopify is if you want to create a content-heavy site, or if you won’t require 24/7 support.
|1.||Overview||Shopify is a complete eCommerce solution for online stores.||WooCommerce is a free WordPress plugin that changes a website into an ecommerce store.|
|2.||Standout Features||Beginner-friendly interface, eCommerce tools, Unlimited file storage||Extreme customization options, dynamic functionality, hosting flexibility|
|3.||Plugins/apps (for eCommerce)||4,000+||1,000+|
|5.||Pricing (starts from)||$29 per month||$6.99 per month|
|6.||Support||24/7 online support||Knowledge base and support ticket|
|7.||Best for||Dropshipping stores, inventory stores, high traffic businesses||Inventory stores|
|8.||Speed (tested for default stores)||1.03 seconds||1.56 seconds|
|9.||Live Examples||See Example||See Example|
My advice is, you should use Shopify as your eCommerce store. While Shopify charges more than WooCommerce, it also offers most of the eCommerce specific extensions for free, which are otherwise paid on WooCommerce marketplace. Shopify is a complete eCommerce solution, and will actually cost you less than WooCommerce on the long run, provided that you have to pay for every functionality you add on WooCommerce.
For the purpose of this guide, let’s create a trial account with Shopify –
Select a 14-days free trial on Shopify – Shopify makes signing up and building an online boutique a cakewalk. All you have to do is visit their website and click the “Start free trial” button. In the beginning, you will get a free 14 days trial to get things going.
Step-5 Name your online boutique
Your boutique name aka domain name is the first thing your visitor will notice. When you are finding a name for your fashion boutique, make sure it is…
- Brandable, short and unique – A good, catchy store name will help you develop your brand (which is essential if you are looking for a long term business). A short, unique domain name will not only be more memorable for your audience, but also good for SEO.
- Relevant but specific – If you are launching a car website and your domain name is something like ABCvehicles.com, it might not be the best choice. Instead, if you go for ABC-cars.com it would be more specific and absolutely relevant. your audience would be able to know about your site.
However, if you have to choose between relevancy and brand, go for the brand. One of the most common examples of this is Amazon. You can use Shopify business name generator to get some boutique name suggestions.
One you have picked up a domain name, get it registered on Shopify, or Namecheap. While Shopify charge $11 per year for a domain name, you can get it on Namecheap for $6.98 per year. Here’s how to connect an existing Namecheap registered domain to your Shopify store.
Step-6 Register your online boutique (+legal documents)
|Note: Step-6 of this guide is written by Sam Mollaei, a professional business lawyer for entrepreneurs. He helps international entrepreneurs in dealing with complicated legal forms. You can reach him for solid legal advice.|
Next, you’d need to register your online boutique as a business identity.
- Sole Proprietorship – A Sole Proprietorship is the simplest type of business to form. However, unlike an LLC, there is no separation between the owner and the business. You can have employees, but you will be held completely liable for any debts and assets related to the business.
- Limited Liability Company (LLC) – An LLC is the most popular type of business to form. You will not be held liable for your business as an LLC creates protection between your boutique business and what you personally own. With an LLC you can open a Bank Account and take advantage of a simpler tax structure.
- Corporation – If you are looking for funding and investors, we would recommend you form a Corporation. Your Corporation will require a Board of Directors and Shareholders. If you are a U.S. citizen, you can also take advantage of the S-Corporation which offers tax advantages. You will also need to have articles of organization/incorporation (proof of your US corporation registration).
After selecting the structure, you would like for your business model, you can proceed with the following steps…
1. Operating Agreement/Bylaws (Corporation or LLC)
This is a document showing the regulation of rights and responsibilities of each LLC/Corporation member and how the company will be managed. It is a legally binding business contract that entails the ownership of its members or shareholders.
2. Employer Identification number
Once you have selected a structure, you will need to apply for an EIN (employer identification number). Think of the EIN as a Tax ID number for your business. But if you are a sole proprietor, you will only need EIN if you want to:
- Hire employees
- Have a Keogh or Solo 401(k) retirement plan
- Buy or inherit an existing business that you operate as a sole proprietorship
- Incorporate or form a partnership or limited liability company, or
- File for bankruptcy
If one of the above isn’t the case, you can simply use your social security number for taxation
An EIN will help you – start your business, open a U.S. bank account, open a Stripe and PayPal account, get a business credit card, and for tax reporting purposes.
3. ITIN (Individual Taxpayer Identification Number)
If you are a non-U.S. citizen and do not have a Social Security Number (SSN) then you absolutely need an ITIN. You can use an ITIN to open a U.S. bank account (personal and business), file a tax return, pay taxes, and comply with any U.S. federal withholding requirements on earned income. Get your ITIN here
4. Seller’s permit
Seller permit or resale license is required for any business selling merchandise to multiple states. In some states, you would also require a Seller’s permit for paying quarterly sales taxes. Your state business department can help you know about the requirements for getting a seller permit.
To give you a head start, every state in the USA needs a seller permit except Alaska, Delaware, Montana, New Hampshire, and Oregon. Find out the state-specific permit rules. Usually, there are online portals for seller’s permits. For instance, if you need to get a California state’s seller’s permit, visit this page.
And before you get confused by all these different terms, a resale id, a reseller ID, a state ID, a Sales Tax ID, a retail ID, and a wholesale ID are all the same thing. But usually, it is referred to as a seller’s permit.
5. Fictitious business name via local newspaper
If you are starting your business using a name other than the owner’s name, or a name that is different from the legal name, then it is said to be a DBA (doing business as). In that case, you need to file for a fictitious business name. It is necessary for those who want to operate their business under a pseudo business name.
For instance, if your name is John Hadlock and you want to start your business as Jclothingassociates, then you have to file for a fictitious business name. But if you start your business under the name John Hadlock collection, you might not need a DBA. Remember that your fictitious name is not an incorporated entity and cannot have something like INC. or Corp tailing it unless it’s a corporation registered under the Secretary of State.
A fictitious business name will help you open a bank account and receive payments in the name of your business. For LLC models, DBA or fictitious name helps in setting up multiple businesses. You don’t require a DBA if you are doing business as your formal entity.
Step-7 Design your online boutique for brand aesthetic
Now that you have signed up your Shopify store, it’s time to make it look appealing. Giving your store a good aesthetic is important for building your brand’s reputation, trustworthiness and improving the overall user experience. So when you select a theme for your Shopify store, think how it will look on your store. Ask yourself, whether or not this design will look good on your store niche.
a. Pick a theme
To select a theme, go to Online Store > Themes on the left sidebar and customize the default theme. Shopify offers both free and premium themes. You can check out the available styles for the free themes and use any of these for your store.
The best thing about premium Shopify themes is that they are built using professional designs, contain better code quality, provide premium support, and are jam-packed with lots of useful features. Make sure you are checking out the user reviews before choosing a premium theme just to evaluate how well it worked out for them.
b. Create a stunning logo
The web-store logo is an important aspect and you should take care of this part when launching your boutique. You can use a Shopify based logo maker to create a personalized logo. Hatchful is a free tool for designing a creative boutique logo from hundreds of pre-made templates.
c. Add policy pages for your online boutique
You will need legal pages for providing information regarding your website policies. You can easily create these pages for free using Shopify business tools.
- Refund policy page
- Terms and conditions page
What to do after setting up an online boutique?
A few years back, it was a lot more difficult to sell online. Nevertheless, the new user-friendly platforms like Shopify have made it a lot easier. You can easily start an online store with a slim-to-none investment. Know all the important things for starting an online boutique during Corona before going ahead.
Now that you know how to start an online boutique, it’s time to take the next steps. Start by optimizing your online boutique and improving the overall Shopify SEO.
You can get some help from your online boutique from eCommerce experts on Shopify marketplace.
If you already have an offline store with great popularity and need a more sophisticated online platform, you can always upgrade to Shopify Plus.
At this point, the guide on how to start an online boutique is officially complete, but I’d like to suggest some eCommerce marketing strategies for the heads start:
- Create unique Facebook/Instagram ads – Facebook marketing is saturated, but you can still make a good conversion for your products.
- Create a blog- Start a simple blog and search for target keywords in your niche using KwFinder.
- Referral marketing – You will ask your customers to refer your store to a friend for a reward.
- Loyalty program – Pat your customers for buying from your store again and again.
- Influencer marketing – Find influencers in your niche and ask them to promote your product.
- Affiliate marketing – provide a small commission on your sales for promoting your product.
I hope this step-by-step guide on how to start an online boutique helped you, if you have any questions, feel free to let me know in the comments below, or reach me out via contact page.