How Much Does It Cost to Start an Online Boutique?
If you’re passionate about clothing, then starting a boutique could be your dream. But opening up a retail boutique requires expensive rent payments or property purchases. That’s why you might be interested in opening an online boutique instead.
Starting an online boutique costs between $500 and $3,000. The amount depends on the business model that you use. For example, dropshipping is cheaper, and starting a private label is more expensive.
There are a lot of factors that can influence the amount you pay to start an online boutique. We’ll take an in-depth look at them below so that you can figure out how much you’ll need to spend.
Let’s get started.
An Overview of Online Boutique Starting Costs
The first step in determining your costs for starting an online boutique is choosing your business model.
We’ll dive into the specifics of each of your options below. But for now, here are the average prices for starting each of the major types of online boutiques:
- Dropshipping – $250 – $500
- Wholesale – $500 – $750
- Private Label – $2,500 – $3,000
- Amazon Store – $1,000
Costs of Starting a Dropship Boutique Online
Dropshipping is the business model with the lowest barrier to entry. It involves selling products that you don’t actually have to hold in your inventory.
That means with this option, you don’t have to worry about buying a bulk amount of inventory before starting your business.
Here are the biggest costs associated with starting an online dropshipping boutique.
Domain Name Registration
The first thing you’ll need to do is register your website’s domain name. Depending on the service you use, this could cost between $10 and $20 per year.
Once you’ve registered your website, it’s time to build it. There are a few ways to do this.
One is to use a template website builder like Wix or Squarespace. Business plans on these websites start around $30 per month. But you may be able to get a discount by paying for a year in advance.
But these template-building websites limit what you can do with your store. If you want to stand out from the competition, you may want to hire a professional web developer instead.
The price for this can vary considerably based on the complexity of your design. But expect to pay somewhere between $1,000 and $10,000 for a professionally-designed website.
Building Your Branding
Now you’re ready to start making your boutique stand out with catchy branding. To do that, you’ll need a logo.
There are websites that let you create a free logo by choosing from a number of ready-made design options. So it’s possible to complete this step for free.
But your logo will play a key role in defining how people feel about your company. So it’s worth spending a little money on.
Designing a business logo can cost between $300 and $1,100.
If you want people to buy from your online boutique, the first step is getting them there. That’s why it’ll be important for you to invest some money in online marketing.
The average cost to reach 1,000 people online is between $3 and $10. The exact amount that you pay will depend on the channels you decide to use.
But you can also market your boutique online for free. You can do so through social media websites like Instagram and Pinterest.
Strategies like running giveaways and partnering with influencers in exchange for free clothes can help a lot.
Costs of Starting a Wholesale Online Boutique
Another business strategy you can use is starting a wholesale online boutique. If you choose this option, you’ll still need to pay all of the costs in the dropshipping section.
You would just add the costs of:
- Purchasing inventory
- Packaging your products
- Shipping your products
Your cost for wholesale inventory depends on what you want to sell. If you plan on being a luxury brand, your costs could be in the thousands.
But that’s definitely not a requirement. You could buy fashionable used clothes from thrift stores instead. That could get your startup inventory costs down to as little as $100.
Packaging and Shipping Your Products
With a wholesale store, you send out your products instead of allowing a third party to do it for you. That means you’ll have to pay packaging and shipping costs.
These prices can vary so much it’s difficult to provide an accurate estimation.
For example, each of the following factors can influence the price you pay to ship an order out:
- The type of packaging you use
- How heavy the items are
- Where the buyer is located
- The shipping company that you use
The good news is, you can pass some, or all of these costs on to your customers if you want. So you only really have to worry about these charges if you want to offer free shipping.
Costs of Starting an Online Private Label Boutique
This business model is the most expensive type of standalone online boutique that you can start. It includes all of the costs covered in the previous two sections.
On top of that, you’ll also need to pay to:
- Design your products
- Obtain a sample
- Buy a bulk order
Designing Your Products
You can design your products online yourself or hire an expert to do the job for you. If you want to hire an expert, expect to pay between $35-$40 per hour for their time. The amount of time that you have to pay for will depend on how many items you want them to design.
Obtaining a Sample
Once you’ve finalized your designs, you’ll be ready to get a sample of them delivered to you. This is an important step because it gives you the chance to verify you’re happy before buying in bulk.
Obtaining a sample product typically costs about $150. But you would have to pay that amount for each unique sample that you receive.
Buying a Bulk Order
Once you’ve received a sample that you’re happy with, you’ll be ready to buy a bulk order.
This can cost between $600 and $1,500. The exact amount will vary based on how many products you purchase and the material used to make them.
Costs of Selling Private Label Products on Amazon
Finally, you also have the option of selling your products on Amazon instead of launching your own online store. Doing this will leave you with a completely different set of costs.
Amazon Professional Sellers Account and Brand Registry
The first thing you’ll need to do is sign up for an Amazon Professional Sellers Account. This is what lets you sell your products on Amazon.
The company charges $39.99 per month for a professional sellers’ account. With this plan, you can sell as many units as you want in a month without any fees.
You may or may not have inventory costs when starting an online boutique through Amazon.
With this plan, you have the option of using dropshipping, a private label, or wholesale. So your inventory costs when starting an Amazon boutique will depend on the business model that you select.
Keyword Targeting Tools
Finally, you need a way to make sure that people actually find your products on Amazon. Using the right keywords in your product titles and descriptions is how you make that happen.
And in order to do that, you’ll need to invest in a keyword targeting tool. This will tell you the keywords that you need to use in order to make sure that people see your products.
The cost of an Amazon keyword targeting tool is about $40.
How Much Do Online Boutiques Make?
As more and more people do their shopping online, web-based boutiques are becoming increasingly profitable. Shopify estimates that the online retail industry will be a $153 billion industry by 2024.
Other data suggests that online boutiques can make $63,000 in monthly revenue and as much as $352,000 in monthly revenue after three years.
But this data is highly dependent upon how well your business does. If people love your products, then you could very well make 5+ figures per month.
It takes time to build that type of following. So be conservative with your income estimates until you start getting your own data that you can use to make projections.
Should I Start an Online Boutique?
Starting an online boutique can absolutely be a smart decision. Depending on the business model that you pick, you could do so for as little as $500. Even the most expensive business models for online boutiques take under 5-figures of startup capital. That’s significantly less than the average brick-and-mortar boutique.
So if you’re passionate about clothing and have limited startup capital, starting an online boutique could be a great move for your career. Even if yours doesn’t ultimately pan out, you won’t have to risk tens of thousands of dollars to find out.