The plus size apparel market is worth over $12.7 billion in the United States and continues to grow rapidly as the average clothing size increases. Opening a boutique catering to this huge consumer base represents a major business opportunity.
Many plus size women find limited offerings in traditional retail stores, which cater to a more frequently worn women’s size. A welcoming environment providing cute, on-trend outfits can quickly gain traction through word-of-mouth referrals alone. Savvy buying and a focus on fashionable clothes can lead to impressive margins while satisfying customers.
This guide will walk you through how to start a plus size boutique. Topics include market research, competitive analysis, registering an EIN, sourcing equipment for your clothing boutique, obtaining business insurance, and more.
1. Conduct Plus Size Boutique Market Research
Market research is essential if your plus size clothing business caters to a niche market. It provides insight into your target market, product trends, and even pricing guides.
Some details you might learn through market research include:
- Urban areas show particular promise for a plus size boutique due to more fashion-forward consumers.
- Over 40% of plus size women feel major retailers do not understand what they want in fashion and fit.
- Dedicated staff providing personalized service is key to customer loyalty.
- A profitable plus size boutique must carefully control inventory to minimize fashion risk.
- Startup boutique owners must identify trending styles and understand the sizing needs of local customers. Thrift shops are a good place to start and see what the current popular style is.
- Building social media buzz early allows validation of merchandise people want.
- Lean into body positivity and inclusiveness as brand positioning.
- The growth trends show the plus size segment will only become more important over time.
- Capturing customer loyalty early allows a boutique to establish itself as a leading fashion destination before national chains expand further into the space.
- Given the fact that 75% of women are now considered plus size while retailers allocate little floor space to these customers, there is tremendous unmet demand in the market.
- A dedicated plus size boutique catering to underserved shoppers has multiple paths to reaching 8 figures in annual revenue.
Market research will help you enter the plus size fashion industry with the knowledge to succeed. From the best personal and business accounts to apply for to the top plus size clothing store competitors in your area, market research is a must.
2. Analyze the Competition
Understanding the competitive landscape is crucial when starting a plus size boutique. This involves evaluating nearby brick-and-mortar options shoppers may frequent along with assessing online sellers catering to the same target market.
A good first step is searching Google Maps and Yelp using keywords like “plus size boutique” and “plus size women’s clothing” near your chosen location. Study the top-ranked competitors, visit their stores, and note strengths and weaknesses regarding pricing, styles, customer service, and overall shopping experience.
Look at the brands competitors carry along with price points. See what seems to sell best in-store. Talk to managers to gauge average transaction values and conversion rates. Use this to shape your merchandising strategy.
For online competition, search phrases buyers may use to find plus size clothing boutiques adding the city name. Look at top sponsored results on Google along with browsing through social media. Who comes up most often?
Check competitor’s websites evaluating visual branding, product photography, website speed, content marketing, and ease of online purchases. Subscribe to email lists being built. Look carefully at social media followings. Higher numbers indicate an existing audience.
Use Facebook’s advertising platform to determine the available audience size for targeted ads. Search interest and buyer intent data from Google Trends.
Analyze online reviews and mentions to uncover pain points experienced by other sellers. Addressing common complaints in your boutique like fit issues or lack of diversity allows for better serving customers.
Constant monitoring of competitors once open is also crucial to keep processes and offerings fresh as the market evolves. Ongoing competitor analysis ensures you don’t get left behind in a brick-and-mortar or online store.
3. Costs to Start a Plus Size Boutique Business
When starting a plus size boutique, significant upfront investment is required before opening the doors. Ongoing costs are also encountered throughout the life of your plus size clothing business. Let’s break these costs down to see where business expenses occur.
Common start-up costs include:
- Incorporation Fees – Registering an LLC or corporation ranges from $100-$800 depending on the state. Most entrepreneurs choose an LLC structure for personal liability protection.
- Boutique Retail Space – Leasing an appropriate 1,200-1,500 sq ft storefront costs an average of $15-$25 per sq ft monthly in a mid-sized metro area, so approximately $18,000-$36,000 per year in rent at a minimum 1-year commitment. Upfits like flooring, lighting, and dressing rooms could run $20,000+ on leased property.
- Starting Inventory – With average plus sizes, plan on stocking at least 500-1,000 unique SKUs averaging $15-$40 retail price points. That’s $7,500-$40,000+ in initial inventory at cost. Order across a broad size range from 14-24 for diversity.
- Point of Sale Equipment – An iPad-based POS system like Square offers the essentials to process payments, manage products/inventory, and view analytics. Basic hardware includes an iPad, cash drawer, and receipt printer costing roughly $800-$1,000 upfront.
- Store Fixtures & Decor – Outfitting the boutique with quality fixtures, fitting rooms, counters, mannequins, and decor usually totals $5,000-$10,000 to create an inviting atmosphere. Add change rooms at approximately $500 each.
- Other Furnishings – Assume $2,000-$5,000 for desks, chairs, office supplies, etc to manage behind-the-scenes paperwork and buying.
- Initial Marketing – Print brochures, post flyers locally, launch pre-opening social media ads, and host giveaways for the early buzz around a $2,000 budget.
So total start-up costs land around a wide range of $ 40,000-$ 140,000+ before adding extra staff or unexpected overruns. Many entrepreneurs self-fund first and then pursue small business loans to ease cash flow.
- Rent & Utilities – $18,000-$36,000+ per year as outlined above. Double net leases also factor in costs for garbage, landscaping, and sometimes utilities.
- Inventory – Restock popular sellers and purchase new items weekly or monthly. Reorder sizes that sell fastest. Average total inventory maintained of $50,000-$100,000 selling through at roughly 3x cost.
- Staffing – Employees cost $15/hour+, expect at least 1.5-2 full-time roles for $45,000+ annually including payroll tax. The owner may not collect profits at first.
- Insurance – $1,000-$2,000 annually for general liability and related business policies.
- Transaction Fees – Credit card processing incurs ~3% fees per payment plus POS software monthly fees eating another 2%+ off top-line sales.
- Marketing – Consistently promote on social ads and via local channels to hit 7 figures; $500-$2,500+ per month recommended depending on what scales best for customer acquisition. Update website and photos routinely.
- Miscellaneous Supplies – Assume a few thousand in miscellaneous monthly supplies like hangers, tags, paper, etc.
Managing cash flow remains imperative when launching any retail business. Conservative financial planning helps minimize growing pain. Customer service and company culture should take priority over profits initially to establish roots within the community.
4. Form a Legal Business Entity
When starting a plus size boutique, choosing the right legal structure establishes rights, protections, and operating procedures moving forward. The four main options include:
A sole proprietorship represents the simplest structure with no formal registration needed beyond required licenses. All profit flows directly to the boutique owner for tax purposes. However, the owner also assumes unlimited personal liability for debts and legal claims meaning business and personal assets are at risk in a lawsuit.
Partnerships require a Partnership Agreement governing the responsibilities and ownership percentages between two or more boutique founders. Profits pass through to partners for tax filings. General partnerships still expose personal assets to liability, however. Relations between partners can also become complicated without clear processes should disputes arise.
Limited Liability Company (LLC)
A better option for a plus size boutique involves forming a Limited Liability Company (LLC). LLC registration protects personal assets if the business faces debts or legal claims. Only boutique assets are at risk. An Operating Agreement dictates financial and managerial rules. Profits pass through an LLC avoiding corporate taxes.
Incorporating as a formal C Corporation or S Corporation is more complex involving articles of incorporation, company bylaws, and issuing stock. Shareholders are shielded from liability. Corporate income is taxed separately from personal returns; double taxation scenarios are possible. More paperwork like annual director/shareholder meetings.
5. Register Your Business For Taxes
A crucial step when forming a business involves obtaining an Employer Identification Number, or EIN, from the IRS. This unique identifier acts like a social security number for your boutique when handling federal tax obligations.
All limited liability companies and corporations legally require an EIN to open business bank accounts, process payroll, and file important tax documents like employment, income, and excise taxes.
As a boutique owner, you must register for an EIN even if you do not plan to hire employees right away. This 9-digit number becomes your permanent business identification with the ability to start the process completely online via the IRS website.
To complete the application, the IRS requires identifying information about ownership and company structure along with the type of business activities conducted. This is quick and free to obtain instantly.
The process involves:
- Visiting the EIN online application
- Verifying identity information
- Selecting the appropriate LLC or Corporation type that matches your plus-size boutique’s registered legal structure
- Providing basic details about ownership makeup, physical business location, and operations
- Reviewing and submitting the form
Almost all applications process within a few minutes to receive your unique EIN. Print or screenshot the confirmation containing the EIN issuance. Moving forward, this identifier serves as your boutique’s recognized business ID across local, state, and federal agencies.
Boutiques selling goods require state-level sales tax permits for handling and remitting owed sales tax appropriately. Fees range by state but typically under $100 to register. Licenses are renewable annually. Handling taxes properly is the cost of operating legally.
6. Setup Your Accounting
Proper financial record-keeping proves vital for boutique profitability and maintaining IRS compliance. Without organizing accounts, it becomes impossible to track true cash flow, expenses, or tax liabilities. Getting systems in place early prevents major headaches.
Open a Business Bank Account
Begin by establishing dedicated business banking and credit card accounts completely separate from personal finances. Any boutique transactions should flow through these channels exclusively. Clean separation of funds allows accurate tracking of profit and expenses via connected financial statements.
Integrate key accounts with small business accounting software like QuickBooks. This automates transaction categorization and cash flow reports. QuickBooks sync seamlessly with bank/CC processing feeds to log all boutique debits and credits within the platform neatly. Run essential financials like P&L statements and tax documents with ease. User permissions allow outsourcing access to an accountant also.
Hire an Accountant
While software proves useful, consider retaining an accountant from the start. Services like bookkeeping, payroll assistance, sales tax filing, and inventory classification all prove useful for new boutique owners less familiar with standards. Expect costs between $200-$500 monthly depending on complexity.
Apply for a Business Credit Card
Applying for a dedicated small business credit card also shields personal credit from company liability and builds credibility with suppliers. Use exclusively for inventory orders, marketing services, or other operating expenses. Interest rates are higher than consumer cards but remain reasonable around 10-20% APR depending on factors like annual revenue.
7. Obtain Licenses and Permits
While eager to open for business, boutique owners must pause first and legally register their company within local jurisdictions to avoid penalties. Find federal license information through the U.S. Small Business Administration. The SBA also offers a local search tool for state and city requirements.
Common permits and business licenses include:
- Zoning Approvals – Local municipalities zone properties for approved uses like retail, residential, or industrial. Opening a boutique within the wrong zoning triggers citations and revocation of occupancy rights if uncorrected.
- Building Permits – Construction work like installing dressing rooms, display platforms or signage requires approved building permits before proceeding. Permits ensure compliance with fire codes, disability access, and structural safety regulations.
- Occupancy Certificate – An occupancy certificate grants legal allowance to conduct commercial business upon passing key inspections related to safety systems, wheelchair access, restrooms, and exits/entrances.
- General Business License – Nearly all jurisdictions require annual business licenses charging between $25-$100 for boutiques under a certain size. Fees are nominal but renewals are mandatory to legally operate year after year.
- Seller’s Permit – While sales tax is handled at the state level, many cities implement additional district taxes on transactions requiring boutiques to also hold a seller’s permit. Verify requirements with the city finance office.
8. Get Business Insurance
Adequate insurance helps safeguard boutiques from scenarios imperiling operations. Policies cover expenses related to property damage, inventory loss, customer incidents, and employee issues exceeding out-of-pocket capabilities. Without proper coverage, a single catastrophic event could shutter doors permanently.
Imagine a pipe bursting overnight flooding the store causing over $100,000 in damage. Or employee theft leading to $20,000 in missing outfits. Alternatively, a customer slipping and breaking an ankle files a $250,000 lawsuit. In all cases, lawsuits and repairs could sink the boutique without insurance backing.
Common coverages to secure include:
- Property insurance covering damage to the store, fixtures, and inventory due to fire, floods, theft, etc – up to policy limits
- General liability insurance handling the bodily injury, property damage, and personal injury claims
- Commercial auto insurance protects against vehicle accidents
- Workers’ comp for managing employee workplace injuries
- Business interruption in the event closure hampers operations
The typical process involves:
- Documenting business details like location, size, inventory value, and operations
- Getting quotes from multiple commercial insurance carriers like The Hartford
- Comparing rates for desired coverage levels across property, liability, and other categories
- Purchasing recommended bundled policy meeting state minimums and risk scenarios
- Providing proof of insurance when signing leases and venue contracts
Insurance represents a regular operating expense that provides essential financial protection from rare but severe perils. Comprehensive policies allow swift resumption of business in the aftermath. Consult a commercial insurance advisor to ensure adequate coverage for the boutique based on local regulations.
9. Create an Office Space
While focused on the retail floor, dedicating back office space facilitates administrative tasks crucial for smooth operations. Owners require desks for buying, marketing, and accounting duties along with storing sensitive documents securely. Weighing options by cost and functionality shapes the decision.
Coworking spaces like WeWork offer convenient plug-and-play offices requiring only a monthly membership starting at around $300. Gaining business amenities like printing, conference rooms, and front desk reception is useful for boutique owners without major private office needs. However, accessing spaces limited to work hours depends on location availability.
Subletting space within a related retail building is cost-effective if excess room allows for installing a private office or two. This grants boutique owners and staff workspaces still accessible outside store hours while onsite. Costs comparable to a formal lease are around $100-$200 monthly per user. The downside includes a lack of receptionist and reliance on shared utilities/internet.
Leasing a dedicated office unit in a commercial building is useful once staff grows beyond a couple of employees. Expect $10-$15 per square foot in lease rates for a modest 800-1,200 sq ft footprint. Outfitting with multiple workstations, inventory storage, a conference room, and receptionist capacity allows scaling. The space is also fully customizable to culture and branding. Proximity to boutique ideal for accessibility.
10. Source Your Equipment
A properly outfitted boutique requires considerable upfront investment in store fixtures, decor, security, and technology systems before opening. Careful deal hunting helps minimize the initial capital needed to build out the ideal space.
When buying new, websites like Wayfair, Overstock, and Webstaurant allow conveniently comparing prices across top brands of clothing racks, registers, mannequins, and salon stations for trying on outfits. Budget at least $5,000 for outfitting a store appropriately. Take time securing quality fixtures built to last years of daily use.
Buying second-hand store furnishings through auction sites like BidFTA proves more affordable for smaller budgets. Search listings not only for boutique-specific items like circular racks and painted cabinets but also general fixtures adaptable like shelving units and countertops useful behind the scenes. Expect to pay 25-50% less buying quality pre-owned furnishings. Just arrange local pick-up for large items.
Renting select boutique equipment is also an option when needing items short-term like extra movable display tables and shelving for initial inventory stocking before reassessing needs once open. Rental fees add up month to month, however. Use sparingly as permanent options more economical long run.
Leasing boutique systems like point-of-sale registers and security camera/alarm installation is recommended for crucial electronics and services. Financing new equipment through 3-5-year leasing deals eases upfront capital requirements substantially. Includes warranty protections also unlike buying outright. Just verify lease terms suit long-term vision before committing.
11. Establish Your Brand Assets
Strategically developing a boutique’s visual identity and branding proves essential for attracting the right target audience consistently. Committing to brand building early on helps set apart the shopping experience in a crowded retail marketplace.
Get a Business Phone Number
Start by purchasing a unique toll-free business phone number through a provider like RingCentral for projecting professionalism whenever clients call the boutique.
Design a Logo
Next, work with a graphic designer on branding aesthetics that reflect the ideal client and store vibe. A memorable Looka ties everything together applied across websites, business cards, and even shopping bags. Modern, playful, or elegant logo marks all appeal to plus-size audiences. Visual cohesion matters most.
Print Business Cards
Print professionally designed business cards, letterhead, and small signage for the boutique entrance from convenient online print shops like Vistaprint. Cards enable owners and staff to network freely, handing out contact info at events, when traveling, etc. Signage builds street visibility.
Buy a Domain Name
Secure the branded domain name for 3-5 years from registrars like Namecheap for establishing an online presence. Short “.com” URLs prove best for recall and search visibility. Use domain across email addresses also elevating professionalism corresponding.
Design a Website
Choose user-friendly website builders like Wix for launching an online hub able to process sales eventually. Well-designed pages reinforce brand image with vibrant photos, product descriptions, and styling advice building organic traffic over time. Or hire web developers through freelance sites like Fiverr to completely custom craft site functionality.
12. Join Associations and Groups
Tapping into local business alliances, industry groups, and community forums accelerates learning when starting any specialty retail endeavor. Surrounding yourself with fellow boutique owners and size fashion experts gives invaluable access to proven ideas, trusted product sources, and potential future partnership opportunities.
Join relevant regional associations like the National Retail Federation to stay on top of sizing standards, consumer research, and policy issues impacting the women’s apparel space. Subscriptions affordable providing streams of insights from national thought leaders through regular publications and virtual events.
Consistently participating in local meetups also helps forge connections with other fashion entrepreneurs right in your metro area. Sites like Meetup showcase dozens of relevant networking events monthly across niche interests like plus size styling and retail entrepreneurship enabling relationship-building face-to-face with supportive peers tackling similar challenges head on.
In addition to in-person groups, Facebook Groups unite plus-size fashion experts everywhere to discuss everything from designing extended sizes properly to the latest player disrupting traditional norms. For instance:
- Plus Size Clothing USA
- Plus Size Women’s Clothing etc. (Buy, Sale, & Trade)
- Plus Size Online Clothing Resale!
Leverage every local and national channel possible to learn best practices from fellow leaders continually elevating the boutique’s potential. Surrounding yourself with the brightest minds proves the ultimate competitive advantage in plus size retail long-term.
13. How to Market a Plus Size Boutique Business
Implementing an integrated marketing strategy proves vital for consistently driving new customers to any fledgling retail operation. Through online and offline channels, boutique owners must creatively capture attention while conveying their unique value proposition to break through noise.
Start by incentivizing existing happy customers to refer friends and family through formal affiliate and loyalty reward programs. For example, offer a $20 store credit to both the referring and new customers following their first purchase. This motivates sharing organically to trusted social groups delivering outsized returns.
A targeted digital approach is also efficient for finding genuinely interested shoppers online:
- Launch Google and Facebook ads micro-targeting women 25-44 within a 25-mile radius filtering further by interests like plus-size fashion, boutiques, and body-positive influencers. Geofencing around competitor locations is smart also. Automate across channels with tools like Mailchimp.
- Start a YouTube channel creating styling advice content and product haul videos to engage potential local customers. Optimize clips for searchability.
- Blog regularly on your site and promote posts through social media driving organic traffic. Cover topics like outfit ideas, interviews with designers, and sale announcements.
- Email new website subscribers with exclusive discount codes and early access to the latest arrivals generating excitement around product launches.
While digital efforts scale better, local traditional marketing is still useful for visibility:
- Print glossy postcard mailers with in-store offers to nearby households matching customer demographics. Send quarterly.
- Ask complimentary businesses like hair salons or spas about placing brochures and sale flyers in their front lobby areas.
- Explore affordable billboards or radio spots driving brand familiarity during commuting hours. Useful for announcing sales or special events also.
- Print large vinyl storefront window posters showcasing current merchandise collections and offers to pedestrians walking by daily.
Rather than choosing a singular approach, boutiques must continually test cost-efficient mediums fine-tuning efforts over time toward the greatest profitability. The most successful build integrated presences spanning online and offline channels tailored toward their specific niche.
14. Focus on the Customer
In the retail industry, customer experience dictates whether shoppers become loyal supporters or one-time visitors. This proves especially true for a plus size boutique whose personalized approach must fulfill wants overlooked by department stores and national chains.
Welcoming every woman into an affirming environment already distinguishes the boutique. But the extra touches matter most. Small gestures like proactively grabbing sizes to start a fitting room or introducing customers by name to in-demand pieces as new inventory arrive knowing their style.
Creating lasting relationships beyond the simple buyer-seller dynamic pays dividends through genuine recommendations to eager friends seeking similar trendy finds across expanding size ranges. Envision five customers each sharing praise for the boutique’s life-changing selection and treatment with their networks. The word spreads like wildfire.
While marketing and merchandising certainly contribute toward plus-size boutique revenues, the customer experience remains the ultimate driver of stability and growth for startup fashion retailers. Provide the tailored shopping experience plus-size women deserve and watch success naturally follow.