Setting up your online boutique can be both fun and profitable. Entrepreneurs entering the sector often exceed their former salaries and achieve unimaginable incomes.
In the world of online business, it all comes down to scale. Once you start an online boutique, you can sell to hundreds, perhaps thousands of customers every month.
The supporting technology has improved dramatically over recent years. It’s easier than ever to set up a boutique, sell products, and receive revenues directly from your business bank account. All the tools you need are right at your fingertips.
There’s a growing market for smaller players, too. While the likes of Amazon still dominate, online consumers are actively looking for boutique stores where they can get something bespoke.
This article shows you how to start an online boutique following a step-by-step process.
What You Need to Know Before Starting Your Own Boutique
Starting an online clothing boutique is not that different from starting any other online store, and it’s not without its challenges. Plenty of off-the-shelf solutions are now available, but new entrepreneurs still face some common challenges.
For instance, you won’t make money overnight when starting an online business. It can take a lot of work and perseverance before a trickle of customers becomes a torrent.
You’ll also face administrative challenges. Taxes for online boutiques, for example, can be challenging to wrap your head around. Depending on your location, states, cities, or counties may require operational permits.
Starting a boutique paperwork and approval process can be long-winded and stressful, and most people make mistakes when beginning with a boutique. But don't lose your entrepreneurial spirit just yet! After all, chance favors the prepared mind.
How to Start an Online Fashion Boutique
Let’s cut to the chase and take a look at how to start an online boutique:
Step 1: Evaluate Your Skills, Mindset, And Traits
Before you take any practical steps toward creating an online boutique, you’ll need to do some soul-searching to determine whether an online store is a suitable option for you. Because it is such a competitive industry, you need the right skills, mindset, and traits to succeed.
The top of the list of traits you need is confidence. If you’re going to start a boutique with no money, you need the conviction that your plans will work out. If negative thoughts get in the way, you’ll only see the downsides, and eventually, you’ll burn out.
Running a boutique business from home requires proper time management. You need a strict schedule of when you will wake up, process orders, work on your website, and contact suppliers.
Remember, when you are your own boss, no one is there telling you what to do. You need to be frank with yourself about whether you can self-motivate. If you don’t, this could be the wrong path for you.
Starting an online boutique also requires having some well-developed financial skills. You need to know:
Whether you are making money or not so that you can determine whether your enterprise is sustainable
Your credit rating and how much it will cost to take out a loan
How to manage a strict budget, particularly if you have limited startup capital
How to start an online boutique without inventory
The difference between various types of business loans
Don’t worry if it all seems overwhelming. If stuck, you can always talk to a financial advisor specializing in helping business owners.
Digital Marketing Skills
If you start an online jewelry boutique but don’t get the message out, you’ll struggle to get customers. Because of the sheer level of competition out there, it is incredibly challenging to get noticed unless you have a marketing strategy ready to go.
The trick here is to learn as much as you can about digital marketing, how it works, and how you can use it to your advantage. Multiple outlets offer courses and certifications that teach you the basics, including DigitalMarketer, LinkedIn Learning, and HubSpot Academy.
Lastly, if you’re planning on setting up an online shoe boutique or something similar, you need to have a passion for what you do. You must be comfortable spending your weekends and evenings scouring trade shows and vintage stores to find the perfect products to insert into your inventory.
When looking for a niche, choose something that excites you. Don’t just set up a high fashion dress boutique because somebody told you it was profitable. Instead, focus on an area you genuinely love and can share with your clients.
You’ll also need the courage and motivation to keep going, even when things get demanding or dull. Taxes, paperwork, and administration tasks will consume a large chunk of your week, so knowing (and feeling) your “why” is critical.
Step 2: Look For Gaps In The Market
Once you’ve evaluated your skills, traits, and mindset, the next step is to identify gaps in the market. Filling an as-yet unserved niche can quickly get your boutique startup off the ground.
For instance, you might notice that existing businesses ignore the niche needs of pet hamster owners. While there are a lot of products out there, including wheels, hammocks, and wooden dens, nobody is selling them all in one place.
Other examples might include boutiques that sell dresses for people living with disabilities, action figurines, medals, or hand-crafted jade necklaces. It doesn’t matter how obscure the niche is, as long as there is demand. The more niche you can make your boutique (without narrowing the market too much), the more successful it will be.
As a side note, you can prosper by setting up a more generic store, but beware of market saturation. If you do something mainstream, like set up a regular online dress boutique, make sure you offer a unique angle. Otherwise, customers won’t know why they should come to you instead of your better-established rivals.
Step 3: Create Your Business Plan And Choose Your Business Model
Writing down a business plan might sound like a chore (particularly if you don’t plan on borrowing from anyone), but it helps focus your mind. Once you put everything down on paper, you can see more clearly what you are trying to achieve and how you might get there.
Take time to identify the following:
The capital resources you’ll need
The obstacles that might get in the way
Your core business idea and what you hope to achieve
How you will prepare before the launch
The marketing channels you will use
Business development timeline
You don’t have to write down how much profit you expect to make every month for the first five years. However, it can be helpful to add up all your predicted costs and then figure out how many sales you’ll need to break even. This way, you can get an idea of whether your enterprise is feasible or not.
In terms of costs, you’ll want to consider:
Shipping costs: For many boutique online stores, shipping costs are a major component of the consumers’ price. You’ll need to balance the cost of shipping against the expense involved in procuring items – and how much you will ultimately charge customers.
Marketing and promotional costs: Digital marketing isn’t cheap either. Many online boutique entrepreneurs are surprised to find out just how expensive it can be. When calculating marketing costs, you’ll need to determine how much companies in your industry typically pay for SEO, PPC, and offline marketing methods. Don’t be surprised by figures over $10,000 per month.
Website costs: Websites are essential for online boutiques. They are your digital storefront. Their expenses include eCommerce platform subscription fees, domain name fees, web hosting fees, merchant services fees, and paid plug-ins.
Inventory costs: Lastly, you’ll need to consider inventory costs – the highest expenses you are likely to face. Naturally, customers will pay you back for the inventory you buy; however, it will still tie up your capital. Work out the value of inventory that you will need to keep at hand at any given moment.
You’ll also need to choose the type of online boutique business model you want to operate. Remember, not all firms make money the same way.
Here are your options:
White label: If you set up a white label (also called “private label”) enterprise, you partner with an existing company that will manufacture products on your behalf. You are then responsible for branding and selling items to your customers.
Dropshipping: If you’re looking to start an online boutique with little to no money, dropshipping is a good idea. Here you partner with a wholesale distributor who takes care of everything for you, including warehousing, distribution, and logistics. All you need to do is make sales via your online storefront.
Bespoke: Truly unique boutiques are sometimes bespoke or “custom cut and sew.” These are the most labor-intensive because you make your products yourself. However, they can also be the most profitable since you are crafting goods that buyers can’t get anywhere else on the market.
Print-on-demand: Lastly, the print-on-demand model involves simply printing your logo or design onto existing clothing. You can either do this in your print shop or forward goods to a printing house to do it for you.
Marketing is another item you’ll want to include in your business plan. While you can outsource essential marketing to third parties, it’s still a good idea to think creatively about the best outreach strategy for your boutique.
For instance, if you’re a new brand, it might make more sense to focus on influencer marketing instead of dumping your budget into generic Google PPC. Alternatively, if you’re offering something completely new, working with journalists and issuing press releases might be a better strategy.
Because there are so many ways of marketing an online boutique, your imagination is often the real limiting factor. Don’t thrash out a marketing plan in an afternoon. Instead, mull it over for several days or weeks to see if you have any breakthrough ideas.
Step 4: Choose Your Company Type And Legal Entity
After you write your online boutique business plan, the next step is to consider the name and legal entity type.
You’ll want the name to be:
Distinctive – so that customers can remember it easily
Enduring – something that won’t fall out of fashion or become dated in the future
Defensible – a name that isn't too similar to another existing brand name, even one from a different industry
Authentic – something that speaks to the character, mission, and values of your firm
Easy to say – so you don’t wind up confusing your audience
As for business entity types, you have three main choices:
Sole proprietorships are probably the easiest business entities to set up. You don’t have to register them with the state where you will operate, and either you or your spouse can be the owner.
Once you set up a sole proprietorship boutique, you (and anyone working on the project with you) will need to report any income on personal tax returns. You usually won’t have to pay taxes if you make a loss. However, you’ll be personally financially responsible for any debts you incur or legal penalties.
Limited liability companies (LLCs) work differently from sole proprietorships. Instead of being personally on the hook for any business-related liabilities, it all goes through the company. This way, you can separate your assets, such as your savings and home, from your enterprise's.
By default, the IRS treats LLC boutiques as pass-through entities. However, you can choose other tax structures, too.
If you want to be able to issue stock in the future, then you might want to consider setting up a corporation. Corporations offer all-important limited liability protection like LLCs, but they have different ownership and tax structures.
When setting up a corporation, you’ll need to choose between S and C corps. S corporations don’t pay the tax directly from the business entity. Instead, owners report company revenues as their income and pay tax. C corps, on the other hand, pay tax on their income, and then owners pay additional taxes on the dividends they receive.
Before you choose any of these legal entities, speak to your accountant. They will be able to tell you which is best for your business model, the size of your company, and the industry in which you want to operate.
Step 5: Find Quality Suppliers And Vet Them
Finding reliable suppliers is essential. Even if you plan on making all your products yourself, you’ll still need to work with partners to procure raw ingredients.
But how do you find great suppliers? The trick is to evaluate them across various dimensions.
Do They Offer Quality?
The first question is whether the supplier offers quality products that meet the standards that your customers expect. Ask them to supply you with a sample to see if it suits your target market.
Can You Have A Good Relationship With The Supplier?
You also need to have a good relationship with your suppliers, particularly if you plan on working with them for any length of time. You want a punctual firm committed to meeting your needs.
Do They Offer A High Level Of Support?
Occasionally, supply chains break down, and things go wrong. When this happens, you need suppliers to get to the bottom of the problem and solve it.
Because of this, it’s a good idea to give suppliers a call and talk to them before you start collaborating. Find out how much support they are willing to offer and take note of their communication style.
Are There Any Reviews Of The Supplier?
Lastly, look around for supplier reviews. Check what other people have been saying about them online. Find out which types of boutiques benefited most from their services, if that information is available.
Step 6: Create Your Website
Once you’ve decided on your legal structure, niche and suppliers, the next stage is to build your website – your brand’s digital storefront.
Here you have two choices: build your own system (similar to what Amazon did), or use an existing eCommerce platform.
The vast majority of people starting a boutique with no money choose to go with an existing platform since they are easy to use and provide all the tools you need to get started.
Choose The Right ECommerce Platform
Today, there are multiple eCommerce platforms, all offering quality services. Popular options include Shopify, WooCommerce, BigCommerce, Magento, Wix, Squarespace, and Sellfy.
When looking for an eCommerce platform, consider the following:
The level of support that the platform offers
The degree of customization the website builder allows
The mobile responsiveness of the platform and the ease with which you can convert desktop designs into those suitable for smartphones and tablets
The subscription cost
The security of the platform, including whether it offers end-to-end encryption
The platform’s hosting environment (and whether it offers sufficient bandwidth to accommodate all your website visitors)
The level of dedication that the platform offers to eCommerce users. (Some platforms are generic website builders first, with eCommerce functionality bolted as an afterthought)
You should be looking to pay between $30 and $80 a month for a solid eCommerce platform if you're just starting. As your business scales, subscription costs will rise.
Start From Scratch
Alternatively, if you don’t want to use an eCommerce platform, you don’t necessarily have to build everything yourself. You can start an online boutique store via social media pages like Instagram or TikTok or popular marketplaces like Amazon and Etsy. This way, you can become established first and then build your online store to cement your brand.
Build Your Online Store
If you decide to set up a store on a domain you own, the next step is to build it. Trying to do everything all at once can be overwhelming, so you’ll want to break it down into bite-sized chunks.
The first place to start is the design. Most eCommerce platforms do a lot of the legwork for you, offering themes that instantly apply to all your web pages, giving your site a cohesive look.
Naturally, you’ll want to choose a design that fits your brand. Most boutiques go for a clean and modern style, but it depends almost entirely on how you sell yourself. Traditional designs are also an option.
You’ll also want the look of your website to reflect your boutique’s character and mission. Visual cues should reveal more of what you’re about, what you stand for, and the type of attitude you want to convey.
At the core of any effective online boutique are product pages. You’ll need to set prices and write accompanying copy that sells on these.
Customers need to be able to buy products through your website so you will need a robust checkout process. Here, you’ll want to include account options (so that your system can remember customers when they return), payment processing facilities, various payment methods (such as Apple Pay or PayPal), and shipping options (such as “next day”).
You’ll also want to include a fully functional shopping cart that allows users to see what items they’ve already chosen.
Step 7: Get An EIN
To operate your business legally, you will need to do two things:
Register your online boutique with the authorities, which is something that you can do once you choose an entity type
Get an EIN
An EIN is a business tax identification number. It tells the authorities who you are when you pay tax. You might not be required to get an EIN in some cases, but it can still help to have one anyway because it keeps business and personal finances separate.
Step 8: Obtain The Necessary Licenses
You may also need to obtain licenses to operate legally in some states. How you need to proceed depends on local law. Here’s a directory you can use to find license requirements for your particular state. You may need a license to operate and specific licenses to sell online or charge sales taxes.
Step 9: Open Your Business Bank Account
A company bank account is essential for opening an online boutique or any other business. This facility lets you separate your private and business finances, making it easier to track expenses and avoid accounting problems at the end of the tax year.
As you search for suitable business bank accounts, look for those that offer features that you want. Generally speaking, you won’t be handling any physical cash, so you won’t have to worry about a nearby local branch when using an online provider. If you need things like cash and checkbooks, the bank can send them to you in the post.
You may also want to take out a business credit card. These can be helpful when you have limited cash flow and need a little extra money to tide you over. With a good issuer, you may be able to get 0 percent APR for a limited time on purchases.
Step 10: Source Funding
Even with some capital for your online boutique, you’ll often need to source more, depending on your business model. For instance, if you adopt a direct source model, you may need to order goods from manufacturers at a minimum volume, which could be prohibitively expensive. You will also need to cover substantial startup costs, as discussed above.
Fortunately, various channels can provide you with the funds you need:
Startup business loans: They are specifically designed to support businesses younger than six months. Often government or corporately-backed, these provide initial cash flow to allow for a fuller business model evaluation.
Purchase order financing: You may also be able to raise money for your online boutique using purchase order financing. Here, customers place an order, and then a third-party financial institution pays the manufacturer on your behalf to cover the order, taking a small cut for themselves. Customers then pay the lender back directly, and you take a small margin later on.
A business line of credit: Business lines of credit are similar to credit cards but don’t usually require you to have such a great credit score.
Of course, you can go down the traditional bank loan route, but you’ll need to carefully write down your business plan and create pitch decks to impress investors. Usually, you’ll only attract venture capital if you offer a new type of business model that VCs believe offers something substantively different from what’s already out there.
Step 11: Open And Market Your Online Boutique
Once all the legal and technical aspects are out of the way, it’s time to finally publish your website and start selling.
Traffic to your site will be minimal at first. Therefore, you’ll need to put your marketing plan into action.
How you do this is very much up to you. In most cases, you will need to dedicate the lion’s share of your budget to it and, perhaps, hire professionals who can get the word out on your behalf.
Most eCommerce platforms are quite good at providing basic assistance, too. For instance, they might offer tools that help you identify suitable keywords or provide buttons that allow you to link your social media accounts. They might not provide the same level of support as third-party agencies, particularly for non-SEO or off-site activities, such as PPC or influencer marketing.
If you have funds ready to go, a good idea is to invest them in Facebook or Google ads. Remember, it will take several months for your SEO efforts to bear fruit, so these methods can immediately get your brand in front of users.
For the first few months, expect high costs and low revenues. Work with a mentor who can tell you whether you should continue with your enterprise or cut your losses if things aren’t working out.
Learning how to start an online boutique can be a lot of fun, but what counts is making it happen. Thanks to modern technology, setting up your online store is significantly easier than before. That being said, lower barriers to entry mean more competition.
Ultimately, you need to be passionate about your online store and niche to be successful. Success can take several years, but it can lead to a more fulfilling life once it arrives.
By Vladana Donevski ·
You needn’t focus on big ventures to earn big bucks: The SME sector is currently thriving, and this guide to small-town business ideas will show how you can build your success story.
With 30 fantastic options for small-town startups included, the guide should provide something for everyone. Let’s get started.
Why Focus on Business Ideas for a Small Town?
The growth of eCommerce opportunities has opened the door for SMEs to target a global audience. However, small-town communities can be a breeding ground for profitable businesses that don’t need a worldwide reach to thrive.
Instead, small-town startups allow you to tap into a concentrated local audience, keeping your shipping expenses down, while capitalizing on your knowledge of their pain points to generate greater conversions. Many entrepreneurs who take this path also enjoy a better work-life balance.
Statistics back up the anecdotal advantages:
Small businesses account for 99.9% of all firms in the US, with the majority being nonemployer firms - i.e., companies run by one person, without a payroll.
91% of consumers prefer to use a small local business whenever it’s convenient to do so.
84% of small business owners feel optimistic about the future of their companies.
Prior to the pandemic, statistics showed that over half of all small local businesses could launch without financial borrowing.
The average small-business owner can expect to make, on average, a little over $71,000 per year.
Furthermore, 2022 promises to be a hopeful year for small towns and their businesses, as we seem to be at the start of “a positive cycle of greater economic vibrancy in small towns and rural America, leading to more people wanting to move and start businesses in small towns.” In short, if you are looking for business ideas, small-town startups have become a standout choice. If you want to launch one - now is the time.
Coming Up with Good Business Ideas for a Small Town
There are plenty of unique business ideas to consider for your small-town venture, but your first priority is to align them with your needs. The following questions can be used for analyzing any candidates:
Convenience: Picking the easiest businesses to start removes some of the risks, and shortens the wait before seeing a return on your investment.
Costs: Calculating the costs of starting a business is tricky. For example, the average micro business takes around $3,000 to launch, or at least somewhere between $2,000 and $5,000. If your idea is more ambitious, you might even have to take out a loan.
Enjoyment: The whole purpose of starting a business is to build a better future. Your happiness should be part of your business plan, not least because your passion for the work will be the driving force throughout the potentially rocky startup process.
Sustainability: The average SME lifespan is around 8.5 years; in other words, you need a small-town business idea that has a realistic shot at long-term success, at least for a decade.
Demand: For any business to work, there must be a demand from the local audience without impenetrable competition. Once you’ve found an opening like that, you’ll have your idea.
If your small-town business venture can tick all of the above boxes and feels right for you, there’s every chance it will deliver positive returns.
Top 30 Small-Town Business Ideas for 2022 & Beyond
Earning in a small town isn’t reserved for mom-and-pop shops with decades of history. In fact, entrepreneurs from various backgrounds and across multiple industries can make use of these top 30 ideas for a thriving business:
1. Restaurant Owner
There are almost 150,000 single-location full-service restaurant businesses in the US, and it is arguably the most obvious business idea of all. Eating out is the perfect way to celebrate special occasions or take a break from the monotony of modern life. Visitors from other places need a place to eat in your small town, too. You can cater to these needs, either with a fine-dining spot, food stand with homemade specialties, or something else entirely.
When opening family restaurants, though, small-town entrepreneurs need to account for the existing eateries in the area. Finding a gap in the market, perhaps serving the type of foods you look for when going out of town, can work wonders. And don’t forget to add a takeout option!
2. Coffee Shop Bar Owner
Coffee shops account for over 37,000 businesses in the U.S., and most of them don’t belong to major franchises. The thousands of small chains and independent coffee shops testify that opening a coffee place might be the best business for people in small towns. After all, the average person drinks nearly two cups of coffee per day, meaning there is a considerable opportunity for regular customers.
A coffee shop can also sell snacks and become a place for digital nomads to work. With the right interior design, your setting can transform into a bar for the evenings. By working the daytime and evening crowds, you should have an excellent chance of success. However, catering to both audiences will be more costly, as you’ll have to get a liquor license, employ more people, etc.
3. Buying a Franchise
Those with more funds at their disposal might consider what franchises in their small towns are for sale. An already established name brand often comes with the advantage of a built-in customer base. Many other aspects of the business will already be settled, too. Over 10% of all companies in America are franchises, and you could become part of this thriving market.
4. Decorating Services
Home decorating is incredibly lucrative. As a small-town contractor, you can focus on painting, interior design, assembling furniture, or offer a full-service package for redecorating. If you can help homeowners or landlords get that dream home, or hike up their property prices, respectively, there should be no shortage of work. After all, Americans spend over $400 billion on home renovations each year. You can also look at roofing and double glazing installations as alternative services in this arena.
The fact that you don't need a commercial office can save you a lot of money, too. Outside of that, your biggest concerns would be getting all the business permits from your small town’s local licensing office and finding a way to spread the word about your new venture.
People need accountants to handle their personal and business financial matters, particularly their tax returns. It is one of the many service-based businesses that thrive despite the rise of online accounting solutions. Most people prefer a local company and people they can talk to in person to trust with their finances. As long as you provide excellent client support and genuine compassion, this is a phenomenal opportunity to earn big.
In fact, the average accountant can expect to earn $70,000+ per year. Of course, this is only possible when you have the necessary skills and qualifications. Nonetheless, if you’ve relocated to a rural area or no longer wish to commute for your current accountancy role, starting a firm of your own can work wonders. You only need a few clients to thrive.
6. Cleaning Company
A lot of small-town entrepreneurs may look down on the prospect of opening a cleaning company. However, this industry is expected to show an average CAGR of 6.5% in the following decade. Moreover, it’s a career you can start with minimal experience and without significant expenses. You simply need the cleaning equipment and transportation.
Cleaning companies may offer services for home, office, and commercial cleaning, or various other niches. The desire to maintain cleanliness is at an all-time high in the wake of the pandemic, and most clients will require repeat services. Whether it’s a weekly visit to their shop or a monthly visit to a residential property, their value to you will be tremendous.
7. Car Repair Service
Every driver loves their vehicle, but they will inevitably face a few maintenance issues from time to time. Small-town businesses in this arena can include mobile mechanic services and local garages. Either way, you can make good money from completing regular repairs or annual servicing.
There is also a chance to gain a markup from the spare parts you use. A car mechanic can make around $69,000 per year, while the owner of a larger service may see even bigger returns. A small-town car repair shop could create a monopoly in your local area, especially once the community trusts you to get the job done and not rob them blind. This is the foundation for sustained success.
8. Food Truck Business
While restaurants are great, they will tie you to one spot. With the right strategy in place, starting a small-town food truck business may be the better solution. It offers you the chance to participate in local events, move your business to the areas that attract the most foot traffic as the seasons change, and even look for opportunities in surrounding towns. This flexibility can help you overcome many problems.
On the other hand, starting a food truck business will require you to master marketing and know your audience. However, if you have a passion for a specific cuisine, it can be your ticket to quick and sustained success. Once you’ve built your reputation in the local area, happy customers will keep coming back for more.
9. Taxi Service
Ride-hailing services have been a popular small-business idea for generations, and the digital age has transformed this arena for the better. You can now start a small taxi company in your rural area or look to join an existing service like Uber or Lyft. This gives you multiple options to choose from and allows you to take on as much responsibility as you can handle.
The taxi industry market share has grown with a CAGR of 8.8%; this has much to do with the fact that many people want to avoid public transportation in the pandemic world. Your service could include minibus driving for airport transport, company events, or social activities like bachelor and bachelorette nights.
10. Airbnb Operator
If your small town attracts many tourists or business visitors, you can take advantage of this with an Airbnb business. If you own an unused property, it is a potentially lucrative environment to break into. The expansion to using two or more properties is straightforward too.
The number of domestic vacations booked by Americans is far higher than before. The industry has been stabilizing recently, and you’ll only need to fill the property for a part of the month to cover mortgage and business costs.
11. Beauty Salon Owner
Everyone needs some professional hair and beauty time occasionally. Small-town entrepreneurs can open up their own salon or share the space with another local business owner. Alternatively, your business can be mobile - you can visit clients in their homes and render your services there, thus saving plenty in overhead costs for space. This can be particularly beneficial in rural areas.
As a hairstylist or beauty technician, you still have to analyze your small-business competition to ensure there is enough demand to accommodate another service or expert. Assuming that there is, you can start earning money immediately. All you need is a toolset, and potentially rental space, and you’ll be good to go.
12. Pet Caretaking
People in your small town will be eager to have someone look after their pets. Pet grooming accounts for 42% of all pet care services, so this will naturally be the best place to start. However, you can also look at dog walking, cat sitting, and related services to boost your returns.
Even if you live in a small town with just a few thousand residents, there will be hundreds of potential clients for you to reach. If starting a salon is too expensive, you could run the venture from your home or consider a mobile service where you visit clients. If you struggle to create a regular flow of customers in your small town, you can serve people in surrounding towns, too.
13. Grocery Store Owner
They say necessity is the mother of all inventions. Therefore, you should ask: “What business does every small town need?” A reliable convenience store is easily one of the top items on the list, as grocery stores comprise over one-third of all brick-and-mortar stores. Of course, your town will already have some. But if there’s a location where adding a grocery store could attract many customers, embrace it.
You might be most familiar with 7-11, but independent stores dominate 60% of this market. They are also one of the easiest businesses to start, because you know that there is a market for them - even if there’s one nearby, convenience stores can never be too close to home. When you also sell gas, they can be one of the best rural town business ideas.
14. Personal Trainer
A career in personal training can be appealing for many reasons. It is one of several business ideas that help the community, as you would be helping clients live healthy lives. Not to mention that getting paid to stay fit and connect with people is wonderful.
The average annual salary of a personal trainer is over $68,000, and you can add to your earnings by becoming a certified nutritionist. As well as targeting your local audience, a strong online presence can open the door to additional services like online training and making exercise programs for apps.
People need help in many aspects of life. With the right education and experience, you can be the person to provide it. As well as being one of the most profitable businesses, beginning a counseling firm allows you to help others. Four in ten Americans (42%) have sought counseling for mental health issues at some point in their lives.
However, accessibility is one of the biggest obstacles to getting adequate support for people in small towns and rural areas. On the bright side, this means you can quickly establish yourself as a valuable resource for the people in your area. Your focus can be marriage and relationships, addiction, anxiety and mental health, or even financial coaching. There are as many areas of counseling as there are of life.
Photography and videography are incredible skills to possess, and accessibility for amateurs is greater than ever. The stills and videos you take can capture magical events like weddings and birthday parties or be used to help local businesses promote their companies. Either way, perfecting your craft should be the first step toward creating a success story.
The average professional wedding photographer can earn over $60k. If you have a monopoly in your small town, though, you may be able to increase those earnings. However, camera and photography equipment - as well as editing tools - won’t come cheap. So, you will need to get some initial funding, and follow tips to save as much as possible in the beginning, while you make a name for yourself.
17. Moving Company
People move around less frequently in rural areas than they do in cities. Considering that the population is also much smaller, you may be excused for thinking that moving companies aren’t a great idea. However, every book of entrepreneur tips will teach you that there is always room for success as long as there is an audience. And there is, as people will often want to move away from that town, and into a more populated area.
In the same vein, professional movers in rural areas may find that they have a higher number of interstate moves, so individual clients may be worth more. Besides, you can look to complete commercial building relocations and refit services.
18. Real Estate Agency
Even if fewer people are buying and selling homes in the area, there are also fewer agents. Roughly two-in-three Americans own property, and the ratio is even higher in rural areas. So, your small-town real estate agency business can still find a fair-sized audience. Depending on your commission, you won’t need to facilitate many sales for a profit.
The only real issue you’ll have compared to a city agency is that you may not be in a position to focus on one property type. You may need to deal with houses, apartments, and commercial real estate. Still, people will turn to you when buying a property, and your ability to help them while also aiding the local economy will be a nice bonus.
Working families need daycares for their children, but they can be few and far between in small towns. Childcare is a $58.6 billion industry, though, and you can enjoy a slice of it. When you’re calculating the costs of starting your business, the primary factor in your balance will be whether you operate from home or a rented space. Most will start with the former before moving to the latter once their small-town startups reach the desired level.
20. Catering Service
Catering is one of the most flexible industries to get into. Aside from the ability to focus on different cuisines and dietary conditions (e.g., gluten-free recipes), you can target your service at multiple events. Birthday parties, engagements, weddings, funerals, graduations, and other special occasions are all commonplace.
Starting a meal-prep business is another form of this idea, and you can integrate it with other small businesses. For example, personal trainers can prepare and deliver healthy meals to help clients with their weight loss or strength-building routines. Catering services can start as micro-businesses, but have excellent growth potential, either by becoming franchises or turning into restaurants.
21. Funeral Director
It’s a harsh fact of life that we will all die, and funeral services are never out of place. If your village or rural area doesn’t have a good service for this, it could be the ideal business opportunity. While this may seem a little morbid, it’s one of the business ideas that help the community by supporting families through their most difficult times. Doing your job with compassion is extremely important, too.
On a more sobering note, the average funeral costs $7,848. In other words, you won’t need to handle too many of them each month for your small town business to become profitable.
One of the first things to do in a small town as far as your career is concerned is to think of ways to turn the skills you already have into a business. Tutoring is one of the easiest ways to do this, as it allows you to establish a work-life balance you prefer.
Tutoring can include teaching art, music, a secondary language, confidence, or a host of other skills. Again, you can use your online presence to offer your services outside your immediate location.
23. Clothes Store Owner
The value of the fashion industry in the US is $409 billion. As well as fashion items, you can look to take advantage of the local climate conditions by selling attire and accessories suited to rural life.
As far as good business ideas for a small town are concerned, clothes stores that reach a broad demographic are great. Don’t limit yourself to a specific age range, gender, or size. Keep in mind that a small town will probably benefit more from affordable fashion over luxury lines, so make your clothes reasonably priced, and you’ll be well on your way to profit.
24. Book Store Owner
Amazon is the biggest online retailer on the planet, but it started as a bookstore. That alone is evidence of the potential for book stores to thrive. They are some of the most popular small-town shops, especially when managed by an owner who cares about reading and finding just the thing for their audience to read.
Over 900 million books are sold in America every year. To give your local store a chance of thriving, you can focus on books relevant to your local area and the bestsellers for customers in your target range. Stationery and craft materials can take your sales to another level, and you could also start a reading club to build excitement.
Like cleaning, gardening is a job that many people simply won’t do. Homeowners may not know where to start or simply feel unmotivated. Meanwhile, business owners probably don’t have the time to take care of landscaping by themselves, too. If you love making outside spaces look beautiful, a gardening service could be one of the best small-town startups for you.
In fact, it is one of the few sectors where small-town business owners may have easier opportunities than city workers. The average homeowner in a smaller community boasts more land with their property. Therefore, each client may require more work or a greater level of service. Your earning potential goes up to $50k, on average.
26. Jewelry Maker
Making accessories is a chance to be creative while keeping the materials and small-business marketing costs fairly low. As well as making online sales, you can show your wares at your local market, too.
There are almost 20,000 jewelry stores in the US, and most consumers actively look for products that come with a high level of customer care. If you can describe the designs, material choices, and other key features with passion, people will appreciate the handmade aspect even more. You can also offer repairs or jewelry cleaning to maximize your earnings.
A candle business may not be the first thing you think of if you’re an aspiring entrepreneur, but the market for it is certainly there. After all, seven in 10 households use candles, and they also make inexpensive yet thoughtful gifts.
Making candles does not require huge starting capital, and you’ll probably be able to avoid taking out startup bank loans. This is another solution that can begin as a local venture before growing into something larger. You could attend trade events or markets a few towns over, or launch an Etsy store to gain more sales.
28. Marketing Consultant
Some of the best small-town business ideas focus on helping other companies. Your town is probably blessed with dozens of small businesses without in-house marketing departments. From creating mobile-friendly websites, to helping them design storefronts and printed materials, marketing expertise can be invaluable. Whether you run a one-person operation or team up with other creatives in the area is your choice.
29. Selling Cars
Small-town entrepreneurs who know about cars will discover that selling them is one of the most profitable businesses, especially if you become the primary vehicle vendor in your area. The key is to know the type of vehicles suited to the rural lifestyle and your clients’ preferences.
For example, even though the electric vehicle marketplace is growing rapidly, these cars won’t be as appealing to drivers in rural areas, where charging stations are not readily available. As with all business ideas, understanding your customers' pain points will be pivotal to your success. Of course, you can also upsell shoppers on accessories, insurance, and finance.
30. Electronics Repair
Waiting for parts deliveries or support for faulty devices is always frustrating. However, it creates a window of opportunity for running an electronics repair store. You can fix anything from smartphones to household appliances, so long as you have the skills - or hire someone who does.
The role can be a lot of fun for anyone who enjoys tinkering, not least because each project presents unique challenges. The industry is worth $18.9bn, and your work could save your neighbors a lot of time and money. In turn, this makes you a valuable member of your local community; better yet, it’s probably a service that will never go out of business.
The Final Word on Small-Town Business Ideas
Many good business ideas for a small town are the same as those in a big city. However, the approach to managing your startup may be different. The key is to be authentic and honest in every aspect of care, while also calculating the costs to keep your venture viable.
As long as you focus on something practical, enjoyable, and financially lucrative (at least in theory), nothing can hold you back.
By Julija A. ·
When starting a business, the debate of wholesale vs. retail is one of the most significant features of developing your strategy. After all, your decision will influence your approach to branding, selling, and order fulfillment. The overall impact on your bottom line can be huge.
There are thousands of success and failure stories in both retail and wholesale. This guide will underline the benefits of either option while also looking at wholesale vs. retail examples in the process. By the end of this article, you should have a much clearer picture of the advantages and disadvantages of both systems.
Wholesale vs. Retail: The Definitions
There are over 32.5 million businesses in the U.S. right now. While not all of them are in the business of commerce and selling goods, millions of them are. And they all face the same dilemma: go wholesale, retail, or a combination of both.
Before deciding which sales approach is right for you, it’s essential to know what they are. The retail definition states that this method of selling revolves around providing goods directly to the consumer or end-user. In most cases, this means selling individual items or products in small quantities.
Conversely, wholesale vendors focus on selling products in bulk quantities. While they can also sell products in smaller quantities, it is often done in large volumes.
The wholesale trade explanation also states that it involves selling items to outlets and retailers and is rarely focused on selling to the end customer directly.
Both the wholesale and retail business models can be used by manufacturers that produce products in-house. Similarly, both models can support brands that focus on acquiring goods from other companies.
While not entirely accurate in all cases, wholesale is often used for B2B, while retail focuses more on selling products to customers.
Wholesale selling focuses on lower costs because the large volumes mean sellers can afford a lower profit margin per item. Moreover, handling costs and other related expenses are far smaller. Retail companies usually charge more because they are focused on selling smaller quantities per transaction.
In many cases, retailers procure their products from wholesalers and subsequently need to add a markup before selling the products on.
Wholesale vs. Retail Examples & Statistics
Market research is vital in all aspects of business management, especially when looking at the pros and cons of wholesale or retail. Some of the key industry facts you should know include the following:
U.S. merchant wholesalers generate $8 trillion of total goods sales per year.
U.S. retail sales are over $5 trillion per year and steadily climbing.
Around 5.9 million people are employed in the wholesale sector.
Small retail business owners in the U.S. can expect to earn around $60-70k per year.
Both wholesalers and retailers can make big money if they are supported by a strong business plan and promote the right products to the target audience. When determining the best option for your business, it will be necessary to consider the products you are hoping to sell and whether you are more likely to achieve a large sales volume from retailers or lots of individual sales from end-users.
It also makes sense to look at the differences between retail and wholesale methods by analyzing some practical examples.
How Retail Works
Retailers can range from huge online outlets like Amazon to small local brick-and-mortar businesses. Meanwhile, many large companies like Walmart operate in both digital and physical spaces.
In addition to store retailing, companies may look to non-store retailing, covering direct marketing and sales, distance selling, and online sales.
Retailing can take many forms, from online fashion stores to department stores or traditional brick-and-mortar stores. However, the fundamentals of business will remain largely the same:
The retailer procures products through wholesale purchases, in-house manufacturing, or other methods.
It promotes the products to a defined client base of end-users who may be interested in them.
Once the products are sold, the retailer fulfills the order. This could mean selling the product in-store, completing an online delivery, or using dropshipping.
While running a retail business is complex and involves hundreds of tasks, from hiring sales staff to printing shipping labels, the basic buying and selling model is that you purchase large quantities of a product before selling individual items at a higher price.
How Wholesale Works
Wholesale involves buying much larger quantities (or manufacturing them yourself) before selling them to retailers. So if you think about the supply chain, wholesalers generally come one step before retailers.
There are well over 400,000 wholesale distributors in the U.S. This includes many types, such as those who work exclusively online, some that focus exclusively on dropshipping, numerous discount wholesalers, and more. In general, we can split them into three groups:
Merchant wholesalers buy goods and their titles before reselling with a markup to businesses, retailers, and other wholesalers.
Agents, brokers, and commission merchants are wholesalers who do not take on the title of the goods. Instead, they serve as a middleman service to negotiate the buying and selling on behalf of their clients. Their payments primarily come through commissions.
Manufacturers’ sales offices and branches are wholesale operations that a manufacturer may run to sell bulk orders of their products to other companies and retailers at a discounted price.
Whichever route is taken, wholesalers usually serve to bridge the gap between the manufacturer and the retailers who will sell those goods to the end-users.
The Pros and Cons of Retail or Wholesale
Now that we've given a retail trade explanation and a wholesale definition let’s look at the pros and cons of retail and wholesale distribution. Understanding these should help you determine which arrangement is best for your company.
The Pros and Cons of Retail
Higher profit margins. Arguably the biggest benefits of retail revolve around pricing. Wholesalers sell large volumes but only make small profit margins per item. The markups when selling directly to the consumer are far higher. Whether you have manufactured the goods yourself or purchased them from a wholesaler, a 100%+ markup is common.
You can utilize multiple sales channels, including online and in-store sales. This means you will see a regular sales flow and serve a much larger customer base than the handful of retailers that typical wholesalers use. Simply put - it creates a more stable business model.
Retail offers an opportunity to connect directly with consumers, and stats show that even digitally native firms are now opening more brick-and-mortar stores than ever before. Any entrepreneur that loves the general function of commerce will prefer this route. Aside from deeper connections, modern data analytics will help guide your marketing and customer care efforts. When handled correctly, this may also help you generate more sales and conversions.
There is potentially less financial exposure. You won’t need massive warehouse spaces or to purchase large volumes of stock before selling. In fact, dropshipping means that you won’t even need to handle stock or order fulfillments. With internet-based sales, you can even operate from home. There is also more room to offer discounts while still seeing profit margins.
You’ll have full control of the brand identity and how products are shown. When relying on department stores and other retailers to sell the goods you’ve produced, their actions could potentially cause a negative impact. Of course, they can have a positive influence too. Still, if you want to enjoy complete control over your sales, retail has an advantage over wholesale.
There is pressure to build a much larger audience base because the average spend of individual customers will be far smaller. This means conducting market research and completing campaigns to reach the right people and find a niche that will bring significant gains. Moreover, retailers will have to continually keep outperforming other online and offline retailers to see sustainably good results.
Retailers often face challenges that wholesalers don’t: in-store theft, for example, can contribute to massive losses and happens far more often than large-scale thefts on company warehouses. End-users are also more likely to seek returns, while the operational and staffing costs of brick-and-mortar stores are usually more expensive than what many wholesalers face.
Reaching new demographics can be challenging. When your brand identity is focused on a niche, it can be difficult to expand beyond it. Likewise, it will limit which products may be suitable for your retail outlet. If you were to hit a downturn in sales, it might prove tough to find upselling opportunities or new client demographics to rejuvenate your brand.
The Pros and Cons of Wholesale
Manufacturers looking to sell their products can significantly improve brand awareness through wholesale distribution agreements. This is because the products will be promoted by a wide range of retailers. As consumers and end-users see your brand more frequently, the likelihood of conversions and an increased company presence on the market will improve.
Wholesale opens the door for for entrepreneurs to dropshipping. Retailers will handle the front-end sales and interactions while you deal with the order fulfillment elements following a sale. It allows you to enjoy some of the best features of retail selling without directly reaching out to consumers yourself. Wholesalers can continue to sell bulk quantities to some retailers while dropshipping for others.
You can sell internationally with greater ease. The costs of transporting single items to end-users can often make this difficult for retailers, especially when the company is new. Shipping large quantities in one go promotes smoother (though riskier) logistics. This can open the door to working in new territories, especially since the chosen retailer will handle the local sales, and you only have to worry about getting the goods to them.
Reduced marketing costs. One of the benefits of wholesale is that you work with retailers who simply want the best product at the best price. They do not need to be sold on a product the same way a consumer would.
Less competition in the wholesale sector. Most wholesalers work with just a small number of products and manufacturers. Selling in large quantities also offers an opportunity to earn more per client, which is one of the key benefits of wholesale over retail.
Wholesalers often require a significant level of capital and a strong cash flow. If they aren’t the manufacturers, they need to buy massive bulk orders before subsequently selling the smaller packages to retailers. The fact that you need to buy large quantities of stock before making sales while also having to buy and maintain a suite of trucks and delivery vehicles means that you’ll have substantial upfront expenses.
The retail vs. wholesale price formula shows that wholesalers often see a markup of around 20% on products. Of course, working with massive quantities means that you can still see large profits overall. Nonetheless, the workload for what is often a small profit margin is one of the significant drawbacks. Meanwhile, damage to a single shipment could seriously harm your ROI, even if the goods are insured.
You are still required to complete some marketing aspects, especially if you manufacture the products you are selling. After all, there needs to be consistency across all retailers. This can produce an extra workload without increasing your direct profits. That said, if it helps retailers, you are likely to get larger and more frequent orders.
As shown above, both retail and wholesale have advantages and disadvantages. In today’s climate, many business owners can combine elements of both selling methods to maximize profits. Setting up two sister websites or brands - one aimed at wholesale and one at retail is a relatively simple task and allows you to enjoy the best of both worlds.
Whether choosing one of the methods or a combination of the two, the most important thing is that you understand how each distribution method will benefit your company and what potential problems each can bring. When you do, success will be far more likely to follow.
By Vladana Donevski ·