how to create a shop business plan

How to Write a Business Plan For a Retail Store: Complete Guide

• August 3, 2022
• Small Businesses

Whether you’re looking to raise funding from private investors or to get a loan from a bank (like a SBA loan) for your retail store, you will need to prepare a solid business plan.

In this article we go through, step-by-step, all the different sections you need in your retail store business plan. Use this template to create a complete, clear and solid business plan that get you funded.

1. Executive Summary

The executive summary of a business plan gives a sneak peek of the information about your business plan to lenders and/or investors.

If the information you provide here is not concise, informative, and scannable, potential lenders and investors will lose interest.

Though the executive summary is the first and the most important section, it should normally be the last section you write because it will have the summary of different sections included in the entire plan.

Why do you need a business plan for a retail store?

The purpose of a business plan is to secure funding through one of the following channels:

• Obtain bank financing or secure a loan from other lenders (such as a SBA loan )
• Obtain private investments from investment funds, angel investors, etc.
• Obtain a public or a private grant

How to write your retail store business plan’s executive summary?

For any retail business, the following information must go into the executive summary:

• Business overview : include your business name and model (independent retail store or franchise model), the products you intend to sell (and whether you want to expand with additional product offerings), the legal structure of your business, etc.
• Market analysis : how many retail stores operate in your area and what do they sell? The estimated number of visitors your customers receive per week, target audience demography (the products you sell must fulfill their needs), purchasing power, etc. must also be included
• People : organizational setup and the management hierarchy along with retail store experience of the key people in the management
• Financial plan : how much profit and revenue do you expect in the next 5 years? When will you reach the break-even point and start making profits? It is ideal to include a chart depicting your key financials such as revenue, gross profits, and net profit
• Financial ask : what loan/investment/grant are you seeking? How much do you need? How long will this last?

2. Business Overview

The business overview is essentially the company description. The second section of your business plan, it should cover the following for a retail store:

• The products you will sell in your store
• The price range of the products
• The company structure
• Target audience information

Let’s look at different subsections that you must include:

Give a brief explanation of why you want to open a retail store. It must display two things:

• Your passion & interest for this type of business
• Feasibility of the business

There may be other retail stores in your area, but they don’t fulfill certain needs of the potential customers. Your business may fill in that gap. 

For example, there may not be any retail store in your area addressing the needs of cyclists. Even if there are competing retail stores, are they offering everything like electric bikes, mountain bikes, touring bikes, BMX, folding bikes, etc.? Do they offer spare parts and customizations?

b) Business Model

This is where you will explain the following:

• Is your retail store independent?
• Are you buying an existing retail store?
• Are you settling for a franchise store of an established bike brand?

c) Products

Your retail store can sell various products. Lenders or investors must get a clear idea of the products you intend to sell. If you want to focus on one or two specific products, you must clarify that, too.

For instance, if you are opening a retail bicycle or bike store , do you intend to sell only assembled bikes or do you intend to sell spare parts, too? What about toolkits? Do you have plans to sell supporting products for cyclists such as helmets, pants, shorts, gloves, eyewear, etc.?

If you have plans to specialize in something (for example, mountain bikes with shock absorption, gears, disc brakes, etc.), mention that.

d) Pricing Strategy

It is important that you add a pricing list here. You don’t need to go into extreme details. Just an average range will be more than enough. 

For instance, mountain bikes can cost anywhere between $400 and $800 . Depending on the components used, the average price can increase or decrease.

A pricing chart for all major products you are offering can help the investors or lenders to tie your pricing strategy with your financial projections.

e) Target Audience

Knowing your customers is very important. That will give you an edge over your competitors. For example, if you are opening a retail bicycle store, you must know whether your potential customers will be enthusiasts, hobbyists, or professionals.

Another important aspect is to understand the type of cyclists you will focus on. The products you sell will depend on that.

Knowing your customers well help in two things:

• You can better retain your customers
• Lenders or investors will be more confident about your business strategy

f) Legal Structure

Finally, your business overview section should specify what type of business structure you opt for. Is this a corporation or a partnership (LLC)? Who are the investors? How much equity percentage do they own? Is there a Board of Directors? If so, whom? Do they have experience in the industry?

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Download an expert-built 5-year Excel financial model for your business plan

3. Market Analysis

The market analysis is the next most important aspect of your retail store business plan. You must demonstrate to the potential investors that you know your market. Investors must be confident that the retail store you are trying to open (or you are already operating) makes sense.

For example, if you want to open a retail store specializing in mountain bikes, it’d be better if you’re located in states like Utah, Arizona, Arkansas, Colorado, North Carolina, Michigan, etc., because these states have ideal mountain bike destinations. Similarly, Texas isn’t really popular for mountain biking.

Again, you will never want to sell high-end bikes in a middle class neighborhood because they will most likely not be able to afford those items.

a) Retail Market Trends

You must also focus on the market size and growth opportunities . For example, if the location of your retail store doesn’t have enough cyclists, your bicycle business will probably not make enough profits. Again, if there are way too many competitors, the growth opportunities may be stifled.

Find market data for your city / area

It is always a good idea to get city-level data to get a clearer picture of the market size in addition to any national-level data you are providing.

Getting city level data might not be an easy task. In fact, you may have to get out and collect the necessary data. You may have to do some math. For example, if there were 30 bicycle retailers in your city in 2019 and the number grew to 33 in 2020, the annual growth rate will be 10%. 

You may want to investigate the factors leading to such growth. For instance, median income may have increased, there may be an influx of population, growing environmental consciousness, increased health awareness, etc., can be some of the factors.

However, you may actually notice a drop. In such a case, you must investigate the reasons. There can be varied factors like drop in income (and hence, sales that led to closure of businesses), decrease in population (may be younger popular moved out of the location), etc.

If there is a drop, you must explain the rationale behind opening a business, the industry of which is showing a gradual decline. It may also happen that the market may rebound back after a temporary decline.

b) Competition

Your competitor analysis is very important. Here are a few questions that you must answer:

• How many retail stores are there?
• How many of those stores are your direct and indirect competitors?
• What type of products do your competitors sell?
• What is the price your competitors are charging for the same or similar product?
• How many employees do your competitors have on an average?
• How many customers do they receive per month?

Some of the answers will end in approximation of data. That’s totally fine. For example, you may not be able to get the exact number of customers your competitors receive.

Draw a strong conclusion for your competitive analysis

Your competitive analysis must bring out the reasons why you are trying to open a retail store. For example (related to the retail bicycle store example):

• There are no specialised mountain bike retailers in the area despite a high percentage of mountain bikers
• Existing bike retailers offer only bikes and spares. No retailer offers clothing and protective gear

c) Customers

You already spoke about the target audience in the Business Overview section. Here, you must provide hard data that establishes the existence of your potential customers in the area.

This section must answer the following questions (with reference to the bike store example):

• What is the age group of the cyclists in your area?
• What percentage of the cyclists are women vs. males?
• What type of bikes are they mostly interested in?
• Do the customers also look for related accessories?
• Do they prefer online shopping or offline shopping?
• What is the average household income per month (and also their average disposable income)?

Much of this hard data will come from your competitor analysis. Also, the data must support your decision to open a retail store. For example, if people have a tendency to buy online, you may be better off opening an online retail store instead of a physical store.

4. Sales & Marketing Strategy

The 4th section of your retail store business plan is where you outline your customer acquisition strategy. Try to answer the following questions:

• What is your USP ?
• What marketing channels will you use (online or offline)?
• Do the marketing channels aptly grab the attention of your target audience? For instance, young adults will most likely not pay attention to TV ads. Instead, use social media
• How do you intend to track the success of your marketing strategy ?
• What is your CAC or customer acquisition cost?
• What is your marketing budget?
• What introductory promos and offers do you intend to provide for attracting new customers?

Let’s expand a bit on a few questions below:

a) Marketing channels

A few marketing channels retail stores typically use are:

• Email marketing
• SMS marketing
• Social media
• Pay-per-click campaigns (e.g. Google Ads, Amazon Ads)
• Partnerships (e.g. with companies to offer employees coupons, discounts, etc.)

b) What is your unique selling proposition?

In other words, how do you differentiate yourself vs. competitors? This is very important as you might need to win customers from competitors.

A few examples of USPs are (with reference to retail bike store example):

• Price : you may have cheaper prices than competitors
• Specialization : you may be specializing in some specific product
• Additional products : you sell additional accessories and safety gear that your competitors don’t
• Freebies : you may offer freebies like helmets or tail lights

Your USP will definitely depend on the products you are selling.

5. Management & Organizational Structure

You must address two things here:

• The management team and their experience / track record
• The organizational structure: what are the different teams and who reports to whom?

a) Management

Your store’s management will vary depending on the business type and size. For instance, if you are opening a franchise store, you may have to give a lot more details compared to an independent store.

You may have co-founders and/or senior managers. You must explain their roles, too. Apart from that, you must also explain their industry experience and why they are suitable for those positions.

b) Organizational structure

Note that even if you have not already hired senior managers and other team members, you must include the details. 

You must define their roles and the hierarchy of reporting. This will demonstrate to the potential lenders and investors the solid management plan you have in place to operate your business efficiently and successfully.

Create and attach an organizational chart for a visual understanding of your store’s staff and their reporting lines.

6. Financial Plan

The financial plan is perhaps, with the executive summary, the most important section of any retail store business plan.

Indeed, a solid financial plan tells lenders that your business is viable and can repay the loan you need from them. If you’re looking to raise equity from private investors, a solid financial plan will prove them your retail store is an attractive investment.

There should be 3 sections to your financial plan section:

• Your historical financials (only if you already operate the business and have financial accounts to show)
• The startup costs of your project (if you plan to open a new retail store, renovate your store, etc.)
• The 5-year financial projections

Historical Financials (if any)

In the scenario where you already have some historical financials (a few quarters or a few years), include them. A summary of your financial statements in the form of charts e.g. revenue, gross profit and net profit is enough, save the rest for the appendix.

If you don’t have any, don’t worry, most new businesses don’t have any historical financials and that’s ok. If so, jump to Startup Costs instead.

Startup Costs

Before we expand on 5-year financial projections in the following section, it’s always best practice to start with listing the startup costs of your project. For a retail store, startup costs are all the expenses you incur before you open the space to your customers. These expenses typically are:

• The lease deposit for the space you rent
• The design and renovation of the existing facilities
• The equipment and furniture

The total startup costs depend on a number of factors, such as the size of your store, the quality of the building (whether there is a lot or remodeling to do or not), the quality of the furniture, etc.

Financial Projections

In addition to startup costs, you will now need to build a solid financial model over 5 years.

Your financial projections should be built using a spreadsheet (e.g. Excel or Google Sheets) and presented in the form of tables and charts in your business plan.

As usual, keep it concise here and save details (for example detailed financial statements, financial metrics, key assumptions used for the projections) for the appendix instead.

Your financial projections should answer at least the following questions:

• How much revenue do you expect to generate over the next 5 years?
• When do you expect to break even?
• How much cash will you burn until you get there?
• What’s the impact of a change in pricing (say 5%) on your margins?
• What is your average customer acquisition cost?

You should include here your 3 financial statements (income statement, balance sheet and cash flow statement). This means you must forecast:

• The number of customers over time ;
• Your expected revenue ;
• Operating costs to run the business ;
• Any other cash flow items (e.g. capex, debt repayment, etc.).

When projecting your revenue, make sure to sensitize pricing and the number of customers, sales as a small change in these assumptions will have a big impact on your revenues.

7. Use of Funds

This is the last section of your retail store business plan. Now that we have explained what your retail store sells and to whom, the industry, management and your marketing strategy, this section must answer the following questions:

• How much funding do you need?
• What financial instrument(s) do you need: is this equity or debt, or even a free-money public grant?
• How long will this funding last?
• Where else does the money come from? If you apply for a SBA loan for example, where does the other part of the investment come from (your own capital, private investors?)

If you raise debt:

• What percentage of the total funding the loan represents?
• What is the corresponding Debt Service Coverage Ratio ?

If you raise equity

• What percentage ownership are you selling as part of this funding round?
• What is the corresponding valuation of your business?

Use of Funds

Any business plan should include a clear use of funds section. This is where you explain how the money will be spent.

Will you spend most of the loan / investment in paying your employees’ salaries and the inventory? Or will it cover mostly the cost for the lease deposit and the renovation of the building?

Those are very important questions you should be able to answer in the blink of an eye. Don’t worry, this should come straight from your financial projections. If you’ve built solid projections like in our retail store financial model template , you won’t have any issues answering these questions.

For the use of funds, we recommend using a pie chart like the one we have in our financial model template where we outline the main expenses categories as shown below.

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Privacy overview.

Retail Business Plan Template

Written by Dave Lavinsky

Retail Business Plan

You’ve come to the right place to create a successful retail business plan.

We have helped over 10,000 entrepreneurs and business owners create business plans and many have used them to start or grow their retail companies.

Sample Retail Business Plan

Below is a retail business plan example to help you create your own business plan.

Executive Summary

Business overview.

Artisan Home & Decor is a startup retail shop located in Pasadena, California. The company is founded by Joyce Hernandez, a retailer who has worked as a store manager of a local home decor store for nearly a decade. Joyce has recently graduated from California University with a Bachelor’s degree in Business Management. Now that she has gained real-world experience managing a store and the education on how to run a retail business, she is inspired to start her own company, Artisan Home & Decor. Joyce is confident that her ability to effectively manage employees, customer relationships, and retail operations will help her establish a profitable retail store. Joyce plans on recruiting a team of highly qualified sales associates, accountants, and buyers to help manage the day to day complexities of retail – marketing, sales, budgeting, sourcing, and purchasing.

Artisan Home & Decor will provide uniquely curated home decor products created by local artisans. The home decor shop will be the ultimate choice for customers in Pasadena who value one-of-a-kind pieces for their homes. Artisan Home & Decor will provide its customers with a refreshingly personalized shopping experience they can’t get anywhere else. The shop’s sales associates will be able to help customers find the perfect pieces to suit their individual preferences and styles.

Product Offering

The following are the products that Artisan Home & Decor will provide:

• Lamps & Lighting
• Throw Blankets
• Photo Frames
• Cookware Sets
• Kitchen Gadgets
• Kitchen and Bathroom Fixtures
• Waste Baskets
• Soap Dispensers

Customer Focus

Artisan Home & Decor will target home decor shoppers looking for a personalized experience and unique pieces in Pasadena. The company will target boomer, millennial, and gen z  consumers looking for unique decor for their homes, apartments, or condos. They will also target businesses looking for special pieces to furnish their corporate offices, waiting rooms, and lobbies. No matter the client, Artisan Home & Decor will deliver the best communication, service, and high quality products.

Management Team

Artisan Home & Decor will be owned and operated by Joyce Hernandez, a retailer who has worked as a store manager of a local home decor store for nearly a decade. Joyce has recently graduated from California University with a Bachelor’s degree in Business Management. Now that she has gained real-world experience managing retail businesses and the education on how to run a retail business, she is inspired to start her own company, Artisan Home & Decor.

Joyce Hernandez has recruited her former assistant manager, Melissa Jacobs to come on board to help her manage Artisan Home & Decor. While Joyce will oversee the employees, day-to-day operations, and client relationships, Melissa will be the Inventory Manager. She will be in charge of sourcing, purchasing, and pricing all inventory. Melissa will work directly with suppliers to stock the retail shop with unique artisan pieces.

Melissa is a graduate of the University of California with a Bachelor’s degree in Interior Design. She has been working at a local retail home decor company for over a decade as an assistant manager. Melissa has an eye for design and keen organizational skills that will allow her to effectively manage Artisan Home & Decor’s one-of-a-kind inventory. Her communication skills will enable her to establish and maintain working relationships with artisans and suppliers.

Success Factors

Artisan Home & Decor will be able to achieve success by offering the following competitive advantages:

• Friendly, knowledgeable, and highly qualified team of sales associates and interior design experts that are able to provide a personalized customer experience and help each client find the right home decor pieces to suit their preferences.
• Artisan Home & Decor will bring fresh inventory into their retail store on a regular basis so there will always be something new for customers to check out. In addition to in-store sales, the company will sell pieces online through its website.
• Artisan Home & Decor offers one-of-kind pieces created by local artisans to suit a wide variety of home decor styles and tastes. By purchasing from the shop, customers are supporting these local artisans and getting fresh decor that no one else will have.

Financial Highlights

Artisan Home & Decor is seeking $210,000 in debt financing to launch its retail business. The funding will be dedicated towards securing and building out the retail space and purchasing the initial inventory. Funds will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and marketing costs for print ads, website and SEO marketing initiatives, and association memberships. The breakout of the funding is below:

• Retail space build-out: $25,000
• Retail store shelving, displays, equipment, supplies, and materials: $40,000
• Three months of overhead expenses (payroll, rent, utilities): $120,000
• Marketing costs: $15,000
• Working capital: $10,000

The following graph below outlines the pro forma financial projections for Artisan Home & Decor.

Company Overview

Who is artisan home & decor.

Artisan Home & Decor is a newly established retail company in Pasadena, California. The new home decor shop will be the ultimate choice for people looking for uniquely curated one-of-a-kind furniture and other home products crafted by local artisans. Artisan Home & Decor will provide its customers with a refreshingly personalized shopping experience they can’t get anywhere else. The shop’s sales associates and experienced interior designers will be able to help customers find the right pieces to suit their preferences and styles.

Artisan Home & Decor will be able to provide a personalized shopping experience for serving customers in-store and online. The team of professionals and sales associates are highly qualified and experienced in interior design, home decor, and the customer experience. Artisan Home & Decor removes all headaches and issues of the home decor shopper and ensures all issues are taken care off expeditiously while delivering the best customer service.

Artisan Home & Decor History

Artisan Home & Decor is owned and operated by Joyce Hernandez, a retailer who has worked as a store manager of a local home decor store for nearly a decade. Joyce has recently graduated from California University with a Bachelor’s degree in Business Management. Now that she has gained real-world experience managing retail stores and the education on how to run a retail business, she is ready to start her own company. Joyce is confident that her ability to effectively manage employees, customer relationships, and retail operations will help her establish a profitable retail store. Joyce has begun recruiting a team of highly qualified sales associates, accountants, and buyers to help manage the day to day complexities of retail – marketing, sales, budgeting, sourcing, and purchasing.

Since incorporation, Artisan Home & Decor has achieved the following milestones:

• Registered Artisan Home & Decor, LLC to transact business in the state of California.
• Has a contract in place to lease the retail space.
• Reached out to numerous local artisans to advise them on the upcoming retail shop in order to start getting supplier contracts.
• Began recruiting a staff of sales associates, interior designers, an accountant/bookkeeper, marketing director, and assistant manager to work at Artisan Home & Decor.

Artisan Home & Decor Services

Industry analysis.

The retail industry in the United States is valued at over $4T currently and is forecasted to reach $4.9T by the end of 2022. This is up from $3.8T in 2019. After a decade of retail decline between 2010 and 2020, the market is rebounding at a surprising rate. There were twice as many store openings as closings in 2021 alone. The number of brick-and-mortar retail establishments is increasing even as ecommerce shopping has grown by 70% in the last three years.

The role of retail stores is evolving and industry operators are discovering in-store experiences are still vital from the customer perspective. Successful brick-and-mortar industry operators are incorporating ecommerce into their business models. Trends include providing ship-from-store and buy online, pickup in store options to give customers more flexibility in the way they can shop. Key success factors include the level of customer satisfaction, product selection, prices, and convenience.

Customer Analysis

Demographic profile of target market.

The precise demographics for Pasadena, California are:

Customer Segmentation

Artisan Home & Decor will primarily target the following customer profiles:

• Millennial customers looking for one-of-a-kind home decor
• Boomer customers looking for one-of-a-kind home decor
• Gen z customers looking for one-of-a-kind home decor
• Businesses looking for unique decor for their offices, waiting rooms, or lobbies

Competitive Analysis

Direct and indirect competitors.

Artisan Home & Decor will face competition from other retailers with similar business profiles. A description of each competitor company is below.

Pasadena Home Decor

Pasadena Home Decor provides high-end home decor for the conscientious consumer. Located in Pasadena, California, the home decor retailer is able to provide a tailored shopping experience for its customers. The store’s list of products includes tables, chairs, wall hangings, rugs, vases, photo frames, candles, office decor, and paintings by local artists. Pasadena Home Decor sells online and in-store to give customers flexibility.

Pasadena Home Decor’s promise is to deliver high quality pieces that will stand out. Customers who purchase furniture and home decor from Pasadena Home Decor will be delighted with the customer service, cleanliness of the store, and personalized design services the company offers.

Home Shoppe

Home Shoppe is a California-based home decor retail store that provides outstanding pieces for discerning clientele. Home Shoppe stocks unique furniture and other decor items that are 100% hand-crafted. The owners of Home Shoppe are experienced craftsmen themselves, so they know how quality furniture and home decor pieces should be made. Clients can depend on their selection of products for durability, style, and eco-friendly materials. Choose Home Shoppe for your next home decor project and let the sales team take the stress out of the redecorating process by helping you select the best products for your home.

Redecorating For You

Redecorating For You is a trusted Pasadena retail company that provides superior home decor products for shoppers in Pasadena and the surrounding areas. The shop offers an extensive inventory of home decor items in a variety of styles so there is something for every taste. Redecorating For You is able to provide premium pieces that fill every space with elegance and style. The shop also eases the stress of redecorating by providing in-store pickup and delivery options for busy customers.

Competitive Advantage

Artisan Home & Decor will be able to offer the following advantages over their competition:

• Artisan Home & Decor will bring fresh inventory into the store on a regular basis so there will always be something new for customers to check out. In addition to in-store sales, the company will sell pieces online through its website.
• Artisan Home & Decor offers one-of-kind pieces created by local artisans to suit a wide variety of home decor styles and tastes.

Marketing Plan

Brand & value proposition.

Artisan Home & Decor will offer the unique value proposition to its clientele:

• Artisan Home & Decor will make redecorating easy for customers by providing in-store shopping, pickup, delivery, online shopping, ship-from-store, and buy online-pickup in store options.
• By purchasing from the shop, customers are supporting local artisans and getting fresh decor that no one else will have.

Promotions Strategy

The promotions strategy for Artisan Home & Decor is as follows:

Social Media Marketing

The company will use various social media platforms such as TikTok, Instagram, Facebook, LinkedIn, YouTube, and Snapchat to promote the shop, feature artisans, and show off new pieces. The marketing director will oversee the social media marketing activities to grow the customer base.

Professional Associations and Networking

Artisan Home & Decor will become a member of professional associations such as the National Retail Federation, California Retailers Association, and the Home Furnishings Association. The company will focus its networking efforts on expanding its network of clients, designers, and artisans.

Print Advertising

Artisan Home & Decor will invest in professionally designed print ads to display in programs or flyers at industry networking events, in home decor publications, and direct mailers.

Website/SEO Marketing

Artisan Home & Decor’s marketing director will be responsible for creating and maintaining the company website. The website will be well organized, informative, and list all of the products currently available for purchase online.

The marketing director will also manage Artisan Home & Decor’s website presence with SEO marketing tactics so that any time someone types in the Google or Bing search engine “Pasadena home decor retailer” or “home decor store near me”, Artisan Home & Decor will be listed at the top of the search results.

Pricing Strategy

The pricing of Artisan Home & Decor will be premium and on par with competitors so customers feel they receive value when purchasing the one-of-a-kind products.

Operations Plan

The following will be the operations plan for Artisan Home & Decor.

Operation Functions:

• Joyce Hernandez will be the Owner and Manager of the store. She will oversee all staff and manage day-to-day operations. Joyce has spent the past year recruiting the following staff:
• Melissa Jacobs – Inventory Manager who will be responsible for sourcing, purchasing, pricing, and inventory management.
• Robert Brown – Staff Accountant/bookkeeper who will provide all store accounting, tax payments, and monthly financial reporting.
• Bill Johnson – Marketing Director who will provide all marketing and sales activities for Artisan Home & Decor including maintaining the website, social media, print advertising, and promotions.
• Julia Smith – Lead Sales Associate & Designer who will manage all sales associates and provide design services for customers.

Milestones:

Artisan Home & Decor will have the following milestones complete in the next six months.

9/1/2022 – Finalize contract to lease the retail space.

9/15/2022 – Finalize personnel and staff employment contracts for the management team.

10/1/2022 – Finalize contracts for suppliers.

10/15/2022 – Begin networking at industry events and implement the marketing plan.

10/22/2022 – Begin moving into the Artisan Home & Decor shop.

11/1/2022 – Artisan Home & Decor opens for business.

Artisan Home & Decor will be owned and operated by Joyce Hernandez, a retailer who has worked as a store manager of a local home decor store for nearly a decade. Joyce has recently graduated from California University with a Bachelor’s degree in Business Management. Now that she has gained real-world experience managing a store and the education on how to run a retail business, she is inspired to start her own company, Artisan Home & Decor.

Melissa is a graduate of the University of California with a Bachelor’s degree in Interior Design. She has been working at a local retail home decor company for over a decade as an assistant manager. Melissa has an eye for design and keen organizational skills that will allow her to effectively manage Artisan Home & Decor’s one-of-a-kind inventory. Her communication skills will enable her to establish and maintain working relationships with suppliers.

Financial Plan

Key revenue & costs.

The revenue drivers for Artisan Home & Decor are the retail fees they will charge to the customers in exchange for their products. The shop will charge a healthy margin to make sure artisans are paid well for their products while ensuring a solid profit for the business.

The cost drivers will be the overhead costs required in order to staff a retail store. The expenses will be the payroll cost, rent, utilities, store supplies, and marketing materials.

Funding Requirements and Use of Funds

• Store shelving, displays, equipment, supplies, and materials: $40,000

Key Assumptions

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.

• Average number of items sold per month: 300
• Average sales per month: $90,000
• Retail space lease per year: $100,000

Financial Projections

Income statement.

Balance Sheet

Cash Flow Statement

Free Business Plan Template PDF for a Retail Store Business

You can download our free retail business plan template PDF here . This is a retail business plan template you can use in PDF format. You can easily complete your retail business plan using our Retail Business Plan Template here .

Retail Business Plan Template FAQs

What is a retail business plan.

A retail business plan is a plan to start and/or grow your retail business. Among other things, it outlines your business concept, identifies your target market, presents your marketing plan and details your financial projections.

What are the Steps To Start a Retail Business?

Starting a retail business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop a Strong Retail Business Plan – The first step in starting a business is to create a detailed retail store business plan that outlines all aspects of the venture. This should include thorough market research, your potential market size and target customers, the services or products you will offer, marketing strategy, your competitive advantages and detailed financial projections.

2. Choose Your Business Structure – It’s important to select an appropriate legal entity for your retail business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your retail business is in compliance with local laws.

3. Register Your Retail Business – Once you have chosen a legal structure, the next step is to register your retail business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options – It’s likely that you’ll need some capital to start your retail business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Store Location – Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees – There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Retail Equipment & Supplies – In order to start your retail business, you’ll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business – Once you have all the necessary pieces in place, it’s time to start promoting and marketing your retail business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.

Other Helpful Business Plan Templates

Ecommerce Business Plan Template Clothing Store Business Plan Template Beauty Supply Store Business Plan Template T-Shirt Business Plan Template

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How to Write An Attention-Grabbing Retail Business Plan

• by Luke O'Neill

minute read

Business success is impossible without a good plan. And in the case of retail stores , that means putting in the time and effort on your retail business plan. 

Now, you might be thinking: ‘why do I need a business plan? I’ve got it all mapped out in my head. I might even have successful businesses already!’

But business plans are so much more than another action item on your ever-growing to-do list.  They communicate your positioning, planning and potential for success to the world.

Whether you’re writing your first business plan or your tenth, we’ve put together a guide to getting it done that will help:

• The purpose of a retail business plan
• How a retail business plan differs from other business plans
• Before you get started
• What to include in your plan
• Mistakes to avoid
• How to set your plan apart

Inventory management made easy

Use our easy-to-follow inventory management to streamline your processes and eliminate errors.

What are retail business plans for? 

Retail business plans are planning and forecasting documents. They explain your business model, who your customers are and how you plan to take your store or online shop from an idea to a profitable reality. 

Why are retail business plans different?

Because retail businesses are different. 

Whether you’re selling from a brick-and-mortar store or through an online shop, you have to consider a combination of factors that many other businesses don’t. Think inventory, store supplies, sourcing and supply chains. And, even more complex activities like order fulfillment, deliveries and customer returns. 

You don’t need to write a tome that covers all of these areas, but they will inform how you put your business plan on paper. 

What are the different sections of a retail business plan? 

Crafting an attention-grabbing retail business plan hinges on detailing its most crucial sections with precision. 

Each section plays a vital role in presenting a comprehensive and convincing plan for your retail business.

Here are three pivotal areas to focus on:

• Executive summary: your elevator pitch. The executive summary distills your business concept, market positioning and unique selling proposition into a compelling narrative that hooks the reader immediately. 
• Market analysis: this section should detail the size and growth potential of your target market, customer demographics, and purchasing habits. It also covers competitor analysis, showing awareness of your competition and how your business will stand out. 
• Financial Plan: lay out your financial projections and funding requirements clearly. This includes startup costs, projected income statements, cash flow forecasts, and a break-even analysis.

Before you write your retail business plan

But let’s pump the brakes for a second. It might be tempting to dive right in and start writing your business plan as soon as possible. But consider these suggestions before you do.

Research your market first

“Without a market, a retail firm cannot exist,” said Susan Smith, marketing manager at Velden Engineering . “One of the first things readers will look for when reading your business plan is evidence of a healthy market, an unmet need in the market and how your company is positioned to meet that need. Completing thorough market research before developing your business plan should be a top priority,” she said.

To grasp customer demographics and preferences, retailers should engage in thorough market research:

• Analyze existing data on target market segments to understand age, gender, income levels and lifestyle choices.
• Conduct surveys and focus groups to gather insights directly from potential customers about their needs, preferences, and shopping behaviors.
• Leverage social media analytics to reveal wider trends and consumer sentiments.

Combining quantitative data with qualitative feedback allows retailers to tailor their offerings and marketing strategies effectively, ensuring their business plan is aligned with customer expectations and market demand.

Understand your competitors

This will give you valuable insight into your own products and services.

“Most industries are becoming oversaturated at this point, so investors want to know what sets you apart. What makes you unique. Do as much research into your competitors as you do into your own business ,” said Gabriel Dungan, CEO and founder of mattress topper company, ViscoSoft.

To research your competitors:

• Shop with them. Browse their online storefront, visit one of their locations, make a purchase and make note of their services.
• Gather their press releases, investor relations and earning statements.
• Chart their growth patterns and research the cities and neighborhoods they operate in.
• Record their USP, product offering and any loyalty programs.

Choose the right location

When selecting a potential location, consider factors such as target market proximity, foot traffic, competition density and the compatibility of the local demographic with your product offering. A prime location can boost foot traffic, offering more opportunities to attract and retain customers.

The impact of location extends beyond mere physical presence; it’s about positioning your business in a spot that maximizes its exposure to the right audience, enhancing the likelihood of higher sales volumes.

Do research to help you articulate the rationale behind your location:

• Gather market research data, foot traffic statistics and competitive analysis.
• Cross reference how your chosen location aligns with your target market’s profile and shopping habits.

Have a growth strategy

Identify a clear growth strategy to strengthen your business plan, suggests Michelle Ebbin, Owner of Australian clothing brand JettProof .  “Most companies focus on market penetration where they sell current products to an already existing market,” said Ebbin. “While that’s a feasible route, you might also want to explore product development by introducing new, innovative products to existing customers.”

“There’s also market development where you try to find new markets for your existing products and diversification for introducing new products to new markets,” she said. Ebbin believes determining a clear growth strategy can increase retailers’ chances of convincing potential investors, who essentially want to know how you will grow your business once it’s up and running.

TIP: Accountants and financial advisors can help you prepare your retail business plan.

Retailers should consider expansion or diversifying product lines and services when their current operations consistently exceed performance expectations, signaling market demand and operational capacity for growth. Analyze sales data, customer feedback, and market trends to identify opportunities. Additionally, if there’s a noticeable shift in consumer behavior or emerging trends align with your business’s strengths, it might be time to diversify. In your business plan, clearly outline the strategic rationale for expansion or diversification, supported by data and market analysis, to demonstrate how these moves will drive future growth and address evolving market needs.

What to include in your retail business plan

When it comes to the specifics, include these details.  

Give a business overview in your executive summary 

For your executive summary, give a high-level description of your retail business. If you had less than two minutes to explain why your business will succeed, what would you say?

You can mention your company’s structure, legal name, location and the products or services you’ll sell, but don’t go in depth—these will all have their own dedicated sections. Describe whether you will be selling in-store, online or across various channels.

Keep this section simple. Use easy-to-understand language. It shouldn’t be more than a page, and it should get people excited right away.

Explain your business goals

In this section, you should talk about what you plan to achieve. Why are you starting this business, and where do you want it to go? Realistically, what will you be able to make happen?

This doesn’t need to be lengthy or complex. And the goal doesn’t need to be huge, either. For example:

“Our goal is to become the go-to provider of HD gaming and streaming cameras for teenagers in San Francisco within 18-24 months.”  

You could also cover any goals you have about locations, product ranges or online stores. 

Showcase your industry experience

This section is more about you, the owner. It’s where you showcase your personal and professional drive to take the business forward. Keep it brief, but say why you’re the right person to take this retail business from an idea to a reality. 

• Your specialty, such as brick-and-mortar, ecommerce or both. Direct-to-consumer (DTC) is also an option.
• Any senior roles in well-known national or regional retail businesses
• Sales or lead generation goals you’ve driven before
• Successful growth initiatives, like new store openings.

Set out your marketing strategy 

Here’s where you talk about your store’s image and branding strategy. Cover of some of the fundamentals of retail marketing, including your plans for the 4Ps of retail marketing. 

Here’s a quick reminder about what they are:  

• Product: What you’ll sell and your Unique Selling Proposition (USP). 
• Pricing: How much your products will cost and why you’ve chosen these price points. 
• Place: Where you’re going to sell your products (online, in-store or omnichannel).
• Promotion: How you’re going to promote both your store and the products you will sell.  

Consider briefly outlining your strategy for leveraging social media for marketing and customer engagement. Describe how platforms like Instagram, Facebook and Twitter will serve as tools for brand promotion, product launches, and direct customer interaction. 

This section doesn’t need to be overlong or complex. If you want to dive into the details—or provide a complete marketing plan —you can do this in an appendix at the end of the plan. 

Financial strategy and forecast

Nine times out of 10, this is what people reading your business plan will most want to see.

“At the end of the day, your company will be judged on its capacity to generate a profit,” said Will Cannon, CEO of Signaturely , an e-signature software company. “Investors will want to see some data related to your startup demands and revenue estimates, no matter how succinct and appealing your retail business plan is,” he said. 

Think about including your:

• Estimated capital requirements
• Profit and revenue model
• Estimated sales volume
• A break-even point calculation
• Balance sheet projections
• Cash flow projections.

Above all, ground these figures in reason.

Detail the management structure

Explain your management setup. Who are the founders? What will their job be? Will you have a CFO, a CPO, a head buyer, a head of marketing? A vice president? Define your titles and jobs. 

This will make things move much more easily throughout the early settling-in time. Everyone will understand where they stand and you will know how you plan to manage people on a daily basis. This strategy should include information such as the number of team members you’ll hire, their roles and how those roles fit into the wider plan. 

Outline your plan for technology and retail operations

In this part of your business plan, detail how you’ll harness retail technology to streamline operations, enhance customer experience and expand your market reach. List your options for POS systems, why you’re considering them, their opportunities for growth and their annual cost.  

Emphasize integrating ecommerce into your business model and exactly how—will you operate your own site, sell on Amazon or both? Discuss the specifics of your online storefront, including website design—will you pay for a custom-coded site?—payment processing systems and cybersecurity measures to protect customer information.

Talk about inventory sourcing and supplier management

Outline your criteria for selecting suppliers, including their sustainability practices, delivery timelines and ability to scale with your business. If you have any quotes from or connections with suppliers already, include those details here. 

Discuss your strategies for efficient inventory sourcing, such as leveraging technology for inventory management, adopting a just-in-time inventory system to reduce holding costs and diversifying your supplier base to mitigate risks. Explain how you plan to negotiate favorable terms and build a collaborative rapport with suppliers to secure better prices, quality improvements and exclusive products.

Include your approach to handling supply chain disruptions and ensuring product availability to meet customer demand without overstocking. 

Make a plan for compliance and legal considerations

This part of your retail business plan should detail any local zoning laws, health and safety standards and specific retail sector regulations you need to make a plan for. 

Mention the need for protecting your business with the right insurance policies. Outline the types of insurance you’ll secure, such as:

• Liability insurance
• Property insurance
• Workers’ compensation

Mention your sustainability and ethical practices

Describe initiatives you’ll invest in, such as using eco-friendly materials, reducing waste through efficient packaging and implementing energy-saving practices within operations, and briefly mention their importance to your potential customers. 

Also discuss the importance of ethical inventory sourcing, ensuring that products are obtained from suppliers who uphold high standards for labor practices and environmental responsibility.

Finish by detailing plans to monitor and adapt to market trends

Future-proof your retail business plan by laying the foundation for scaling and adapting. Outline your strategies for continuous market research, including customer feedback mechanisms, social media monitoring and industry reports, to identify emerging trends and shifts in consumer preferences.

Discuss how your business plan is designed to be flexible, allowing you to swiftly adapt to changing market conditions. This might include diversifying product lines, embracing new technologies or refining marketing strategies to meet evolving consumer demands. 

Avoid these common mistakes

A good business plan is as much about what you leave out as what you put in. 

Too much detail

You’re not here to write a novel. You’re here to get busy people on board with your business plan.

“Potential partners and investors will not waste time pouring over hundreds of pages of rambling nonsense,” said Nick Edwards, Director at Snow Finders , a ski holiday company in the UK.

Long blocks of text should be avoided. Use visuals and graphics to substitute prose, with any exceptionally heavy content being attached as appendices if necessary.

Poor financial planning 

Some landlords take a percentage of sales as part of the rent. And it’s common for rent to increase annually. Your retail business plan should account for growing expenses, taxes and wider market influences to prove you’ve got a handle on your financial planning.

Spelling and grammar

Remember the basics. Grammar and spelling errors show you haven’t put diligence into the planning process. And that can undermine how partners and potential investors view the plan.  

Once you’ve written your business plan, have a professional editor look it over to catch any errors and make sure you’re as clear as possible.

How to strengthen your business plan 

As you’ll have noticed by now, you need to keep a few different audiences in mind while writing your business plan. In most cases, there are three:

• Potential investors: People or businesses who want to back your business with capital, in return for future profits or part-ownership.
• Potential business partners: Suppliers, brands and business partners who may want to supply goods or services to your business, or even help you run the whole show. 
• Banks, lenders and insurers: Financial institutions that you may need for credit cards, overdrafts, loans or revolving credit facilities. 

“Be wary about exaggerating your numbers or laying out too difficult or impossible things,” said Stacey Kane, Business Development Lead at Easy Merchant . “You want the investor who finds flaws in your plan to be the exception, not the norm. With this perspective, you can strengthen your view of what can be done with research and transparent results. Finding ways to show how valuable your idea is will also help make them more likely to invest,” she said.  

Finishing your retail business plan 

Done well, business plans are much more than a helpful written guide to your business strategy. They’re a resource to attract future business partners, and even a foundation for securing outside funding. Don’t put writing your retail business plan on the backburner for too long—it could be one of the first stepping stones to your very own thriving retail business. 

Ready to write your retail business plan? Talk to a Lightspeed product expert to discover how the right POS technology can help you show investors and partners that you mean business. 

Frequently asked questions about business plans

How do i write a retail business plan.

Begin with a clear executive summary, followed by market analysis to understand your audience.

Detail your business description, including products and services. Include sections on organization and management, marketing and sales strategies, funding requests (if applicable), financial projections and an appendix for additional documents. 

Each section should be concise, backed by research, and reflect your vision for the business.

How do I start a successful retail business?

• Identify a market need and develop a business model that addresses that need uniquely. 
• Conduct thorough market research.
• Choose a strategic location.
• Curate a compelling product mix.
• Write a business plan detailing all this, plus financial planning, and get funding.

How do you structure a retail business?

Organize your operations into key areas: procurement, sales, marketing, inventory management, customer service and finance. Define clear roles and responsibilities for your team to ensure smooth operations and a positive customer experience.

What does a retail business plan look like?

A retail business plan includes an executive summary, market analysis, business description, organization and management structure, details of product or service offerings, marketing and sales strategy, financial projections and an appendix. It’s a structured document that outlines your business goals and your financial expectations.

How do you start a business plan from scratch?

Start by defining your business idea and objectives. Conduct market research to understand your competition and target audience. Outline your business structure, products or services, marketing and sales strategies and financial plans including projections. Write an executive summary last, which summarizes the key points of your plan. Use a clear, concise and realistic approach throughout the document.

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Luke O’Neill writes for growing businesses in fintech, legal SaaS, and education. He owns Genuine Communications , which helps CMOs, founders, and marketing teams to build brands and attract customers.

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How to make a business plan

Table of Contents

How to make a good business plan: step-by-step guide.

A business plan is a strategic roadmap used to navigate the challenging journey of entrepreneurship. It's the foundation upon which you build a successful business.

A well-crafted business plan can help you define your vision, clarify your goals, and identify potential problems before they arise.

But where do you start? How do you create a business plan that sets you up for success?

This article will explore the step-by-step process of creating a comprehensive business plan.

What is a business plan?

A business plan is a formal document that outlines a business's objectives, strategies, and operational procedures. It typically includes the following information about a company:

Products or services

Target market

Competitors

Marketing and sales strategies

Financial plan

Management team

A business plan serves as a roadmap for a company's success and provides a blueprint for its growth and development. It helps entrepreneurs and business owners organize their ideas, evaluate the feasibility, and identify potential challenges and opportunities.

As well as serving as a guide for business owners, a business plan can attract investors and secure funding. It demonstrates the company's understanding of the market, its ability to generate revenue and profits, and its strategy for managing risks and achieving success.

Business plan vs. business model canvas

A business plan may seem similar to a business model canvas, but each document serves a different purpose.

A business model canvas is a high-level overview that helps entrepreneurs and business owners quickly test and iterate their ideas. It is often a one-page document that briefly outlines the following:

Key partnerships

Key activities

Key propositions

Customer relationships

Customer segments

Key resources

Cost structure

Revenue streams

On the other hand, a Business Plan Template provides a more in-depth analysis of a company's strategy and operations. It is typically a lengthy document and requires significant time and effort to develop.

A business model shouldn’t replace a business plan, and vice versa. Business owners should lay the foundations and visually capture the most important information with a Business Model Canvas Template . Because this is a fast and efficient way to communicate a business idea, a business model canvas is a good starting point before developing a more comprehensive business plan.

A business plan can aim to secure funding from investors or lenders, while a business model canvas communicates a business idea to potential customers or partners.

Why is a business plan important?

A business plan is crucial for any entrepreneur or business owner wanting to increase their chances of success.

Here are some of the many benefits of having a thorough business plan.

Helps to define the business goals and objectives

A business plan encourages you to think critically about your goals and objectives. Doing so lets you clearly understand what you want to achieve and how you plan to get there.

A well-defined set of goals, objectives, and key results also provides a sense of direction and purpose, which helps keep business owners focused and motivated.

Guides decision-making

A business plan requires you to consider different scenarios and potential problems that may arise in your business. This awareness allows you to devise strategies to deal with these issues and avoid pitfalls.

With a clear plan, entrepreneurs can make informed decisions aligning with their overall business goals and objectives. This helps reduce the risk of making costly mistakes and ensures they make decisions with long-term success in mind.

Attracts investors and secures funding

Investors and lenders often require a business plan before considering investing in your business. A document that outlines the company's goals, objectives, and financial forecasts can help instill confidence in potential investors and lenders.

A well-written business plan demonstrates that you have thoroughly thought through your business idea and have a solid plan for success.

Identifies potential challenges and risks

A business plan requires entrepreneurs to consider potential challenges and risks that could impact their business. For example:

Is there enough demand for my product or service?

Will I have enough capital to start my business?

Is the market oversaturated with too many competitors?

What will happen if my marketing strategy is ineffective?

By identifying these potential challenges, entrepreneurs can develop strategies to mitigate risks and overcome challenges. This can reduce the likelihood of costly mistakes and ensure the business is well-positioned to take on any challenges.

Provides a basis for measuring success

A business plan serves as a framework for measuring success by providing clear goals and financial projections . Entrepreneurs can regularly refer to the original business plan as a benchmark to measure progress. By comparing the current business position to initial forecasts, business owners can answer questions such as:

Are we where we want to be at this point?

Did we achieve our goals?

If not, why not, and what do we need to do?

After assessing whether the business is meeting its objectives or falling short, business owners can adjust their strategies as needed.

How to make a business plan step by step

The steps below will guide you through the process of creating a business plan and what key components you need to include.

1. Create an executive summary

Start with a brief overview of your entire plan. The executive summary should cover your business plan's main points and key takeaways.

Keep your executive summary concise and clear with the Executive Summary Template . The simple design helps readers understand the crux of your business plan without reading the entire document.

2. Write your company description

Provide a detailed explanation of your company. Include information on what your company does, the mission statement, and your vision for the future.

Provide additional background information on the history of your company, the founders, and any notable achievements or milestones.

3. Conduct a market analysis

Conduct an in-depth analysis of your industry, competitors, and target market. This is best done with a SWOT analysis to identify your strengths, weaknesses, opportunities, and threats. Next, identify your target market's needs, demographics, and behaviors.

Use the Competitive Analysis Template to brainstorm answers to simple questions like:

What does the current market look like?

Who are your competitors?

What are they offering?

What will give you a competitive advantage?

Who is your target market?

What are they looking for and why?

How will your product or service satisfy a need?

These questions should give you valuable insights into the current market and where your business stands.

4. Describe your products and services

Provide detailed information about your products and services. This includes pricing information, product features, and any unique selling points.

Use the Product/Market Fit Template to explain how your products meet the needs of your target market. Describe what sets them apart from the competition.

5. Design a marketing and sales strategy

Outline how you plan to promote and sell your products. Your marketing strategy and sales strategy should include information about your:

Pricing strategy

Advertising and promotional tactics

Sales channels

The Go to Market Strategy Template is a great way to visually map how you plan to launch your product or service in a new or existing market.

6. Determine budget and financial projections

Document detailed information on your business’ finances. Describe the current financial position of the company and how you expect the finances to play out.

Some details to include in this section are:

Startup costs

Revenue projections

Profit and loss statement

Funding you have received or plan to receive

Strategy for raising funds

7. Set the organization and management structure

Define how your company is structured and who will be responsible for each aspect of the business. Use the Business Organizational Chart Template to visually map the company’s teams, roles, and hierarchy.

As well as the organization and management structure, discuss the legal structure of your business. Clarify whether your business is a corporation, partnership, sole proprietorship, or LLC.

8. Make an action plan

At this point in your business plan, you’ve described what you’re aiming for. But how are you going to get there? The Action Plan Template describes the following steps to move your business plan forward. Outline the next steps you plan to take to bring your business plan to fruition.

Types of business plans

Several types of business plans cater to different purposes and stages of a company's lifecycle. Here are some of the most common types of business plans.

Startup business plan

A startup business plan is typically an entrepreneur's first business plan. This document helps entrepreneurs articulate their business idea when starting a new business.

Not sure how to make a business plan for a startup? It’s pretty similar to a regular business plan, except the primary purpose of a startup business plan is to convince investors to provide funding for the business. A startup business plan also outlines the potential target market, product/service offering, marketing plan, and financial projections.

Strategic business plan

A strategic business plan is a long-term plan that outlines a company's overall strategy, objectives, and tactics. This type of strategic plan focuses on the big picture and helps business owners set goals and priorities and measure progress.

The primary purpose of a strategic business plan is to provide direction and guidance to the company's management team and stakeholders. The plan typically covers a period of three to five years.

Operational business plan

An operational business plan is a detailed document that outlines the day-to-day operations of a business. It focuses on the specific activities and processes required to run the business, such as:

Organizational structure

Staffing plan

Production plan

Quality control

Inventory management

Supply chain

The primary purpose of an operational business plan is to ensure that the business runs efficiently and effectively. It helps business owners manage their resources, track their performance, and identify areas for improvement.

Growth-business plan

A growth-business plan is a strategic plan that outlines how a company plans to expand its business. It helps business owners identify new market opportunities and increase revenue and profitability. The primary purpose of a growth-business plan is to provide a roadmap for the company's expansion and growth.

The 3 Horizons of Growth Template is a great tool to identify new areas of growth. This framework categorizes growth opportunities into three categories: Horizon 1 (core business), Horizon 2 (emerging business), and Horizon 3 (potential business).

One-page business plan

A one-page business plan is a condensed version of a full business plan that focuses on the most critical aspects of a business. It’s a great tool for entrepreneurs who want to quickly communicate their business idea to potential investors, partners, or employees.

A one-page business plan typically includes sections such as business concept, value proposition, revenue streams, and cost structure.

Best practices for how to make a good business plan

Here are some additional tips for creating a business plan:

Use a template

A template can help you organize your thoughts and effectively communicate your business ideas and strategies. Starting with a template can also save you time and effort when formatting your plan.

Miro’s extensive library of customizable templates includes all the necessary sections for a comprehensive business plan. With our templates, you can confidently present your business plans to stakeholders and investors.

Be practical

Avoid overestimating revenue projections or underestimating expenses. Your business plan should be grounded in practical realities like your budget, resources, and capabilities.

Be specific

Provide as much detail as possible in your business plan. A specific plan is easier to execute because it provides clear guidance on what needs to be done and how. Without specific details, your plan may be too broad or vague, making it difficult to know where to start or how to measure success.

Be thorough with your research

Conduct thorough research to fully understand the market, your competitors, and your target audience . By conducting thorough research, you can identify potential risks and challenges your business may face and develop strategies to mitigate them.

Get input from others

It can be easy to become overly focused on your vision and ideas, leading to tunnel vision and a lack of objectivity. By seeking input from others, you can identify potential opportunities you may have overlooked.

Review and revise regularly

A business plan is a living document. You should update it regularly to reflect market, industry, and business changes. Set aside time for regular reviews and revisions to ensure your plan remains relevant and effective.

Create a winning business plan to chart your path to success

Starting or growing a business can be challenging, but it doesn't have to be. Whether you're a seasoned entrepreneur or just starting, a well-written business plan can make or break your business’ success.

The purpose of a business plan is more than just to secure funding and attract investors. It also serves as a roadmap for achieving your business goals and realizing your vision. With the right mindset, tools, and strategies, you can develop a visually appealing, persuasive business plan.

Ready to make an effective business plan that works for you? Check out our library of ready-made strategy and planning templates and chart your path to success.

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How to create a retail store business plan

By Homebase Team

A successful retail business starts with a well-thought-out retail business plan. While you may think you have your business ideas all figured out in your head, putting them down on paper in the form of a business plan is crucial for several reasons. 

In this post, we’ll explore what a retail business plan is, why it’s different from other business plans, what to include in it, common mistakes to avoid, and how to make your plan stand out.

What Is a Retail store business plan and why do you need one?

A retail store business plan is a comprehensive document that outlines your business model, identifies your target customers, and lays out a roadmap for turning your retail store or online shop into a profitable business. 

It’s a planning and forecasting tool that provides clarity and direction for your business. With a good business plan, you’re more likely to achieve success. 

Here’s why having a retail store business plan is essential:

Planning and forecasting

A retail store business plan helps you plan and set clear goals for your business’s short-term and long-term success.

Planning helps you set goals, allocate resources wisely, and stay on track. It ensures that day-to-day operations run smoothly. Forecasting, on the other hand, helps businesses anticipate future trends and challenges, allowing them to make informed decisions and adapt to changing circumstances. 

Together, planning and forecasting help you avoid costly mistakes, reduce labor costs , seize opportunities, and achieve both short-term and long-term objectives. In essence, they’re like a GPS for your retail business, guiding it towards profitability and sustainability.

Securing investment

A retail store business plan helps secure investment by demonstrating a clear and well-thought-out strategy. It shows potential investors that you’ve done your homework, understand your market, and have a solid plan for success. 

The plan outlines your business goals, target market, competitive analysis, and financial projections, instilling confidence in investors that their money will be used wisely. It also highlights your commitment and professionalism, making you a more attractive investment opportunity. 

Essentially, a strong retail business plan reassures investors that your venture is a sound investment with a higher likelihood of delivering returns on their capital.

Guiding business operations

A retail store business plan serves as a roadmap for guiding business operations. It outlines your business’s goals, strategies, and tactics, providing a clear direction for daily activities. 

It helps you make informed decisions about product offerings, retail staff scheduling , pricing, local business marketing , online marketing and staffing. The plan also includes financial projections and budgeting, ensuring you manage resources effectively. 

Regularly reviewing the plan allows you to track progress, identify areas needing improvement, and adjust strategies accordingly. Overall, it keeps the business focused, organized, and aligned with its objectives, making day-to-day operations more efficient and effective in achieving long-term success.

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How is a retail business plan different from other business plans?

Retail businesses are unique in many ways, and your business plan should reflect that. Unlike other businesses, retail operations involve factors such as inventory management , supply chains, order fulfillment, deliveries, and customer returns. 

Here’s how a retail store business plan differs:

Inventory management

Unlike other business plans, retail plans must handle challenges like seasonal sales variations and predicting what customers will buy. Inventory management in retail business plans is about keeping the right amount of products in stock to meet customer demand while avoiding excess or shortages. 

They also need to explain how they get products, where they store them, and how they restock when items run low. In contrast, many other businesses don’t deal with these inventory issues.

Retail store business plans focus more on handling and controlling inventory to make sure they always have what customers want and don’t waste money on too much stock.

Marketing strategy

Marketing strategy in retail store business plans, compared to other business plans, often emphasizes attracting customers to physical or online stores, creating appealing displays, and running promotions like sales or loyalty programs. 

Retail plans typically prioritize reaching a broad consumer base and enticing them with visually appealing products. In contrast, other business plans might focus on more specialized marketing, like B2B partnerships or online advertising. 

Retailers also consider factors like store location and layout, which are less significant for many other businesses. So, simply put, retail business plans concentrate on tactics to draw in shoppers and make their shopping experience enjoyable and memorable.

Growth strategy

Growth strategy in retail store business plans, unlike other business plans, often centers on expanding to new locations, introducing new product lines, or attracting more customers. Retailers aim to increase sales by opening additional stores, going online, or diversifying their offerings. 

In contrast, some businesses may focus on improving internal processes or targeting specific niche markets. 

Retailers typically rely on broadening their reach to fuel growth, making strategies like franchising, adding new store branches, or exploring e-commerce crucial components of their plans. So, in simpler terms, retail business plans tend to emphasize expanding the business footprint and customer base as a primary path to success.

What to do before you start writing your retail store business plan

Research your market.

T horough market research is essential. Investors look for evidence of a healthy market and an unmet need that your business can address.

You’ll want to gather data on who your customers are, what they want, and where they’re located. Analyze your competition to see what makes your business unique. This research helps investors see that there’s a demand for your products or services and that your business can thrive in the market. 

It’s about proving that your idea is well-informed and has the potential to succeed. So, in simple terms, thorough market research shows investors that your business plan is based on a strong foundation of knowledge and understanding.

Understand your competitors

 Know your competition inside out. Understanding what sets you apart is crucial.

You need to know who you’re up against and what makes them tick. Research your competitors thoroughly: their strengths, weaknesses, and strategies. Identify what sets your business apart – your unique selling points. 

Investors want to see that you’ve done your homework and can explain how your retail store will outshine the competition. Maybe it’s better prices, superior quality, or outstanding customer service. 

This knowledge not only helps you stand out but also shows investors that you’re ready to face the competition head-on, which can boost their confidence in your business’s potential success.

Have a growth strategy

Define a clear growth strategy to demonstrate how your business will expand once it’s up and running. It shows investors that you’re not just focused on starting your business but also on making it grow in the long run. 

You can outline different growth strategies like market penetration (selling more to existing customers), product development (creating new products for existing customers), market development (selling existing products to new markets), or diversification (introducing new products to new markets). 

This helps investors understand your vision and how you plan to increase your business’s value over time, making your retail venture a more attractive investment opportunity.

What to Include in your retail store business plan

Business overview.

Provide a high-level description of your retail business, including your company’s structure, location, and the products or services you’ll offer.

Business goals

Explain your business goals, whether they’re related to market share, product ranges, or online expansion.

It should give a clear, simple picture of your retail business. Explain whether your business will operate in a physical store, online, or both. 

Mention the legal name of your company, where it’s located, and briefly describe the products or services you plan to sell. Keep it straightforward and easy to understand, so anyone reading your plan can quickly grasp what your retail business is all about. 

This section sets the stage for the rest of your plan, helping readers get a sense of your business from the get-go.

Your industry experience

In the “Your industry experience” section of your retail store business plan, it’s your time to shine. Tell the readers about your background and expertise, especially if you’ve held important positions in recognized retail businesses. 

If you’ve previously led successful growth initiatives or managed to open new stores that flourished, this is the place to mention it. Basically, this section is all about showcasing your qualifications and experience in the retail world.

It helps build trust and confidence that you’re the right person to turn your retail business idea into a thriving reality. Keep it concise but impressive.

The “ Marketing strategy ” section of your retail store business plan is where you paint a picture of how you’ll present your store to the world. Explain your store’s image, the strategy for your brand, and how you plan to market your products or services. 

Don’t forget to dive into the 4Ps of retail marketing:

• Product : Describe what you’re selling and what makes it special.
• Pricing : Explain how you’ll price your products and why.
• Place : Tell where you’ll sell your products, be it online, in-store, or both.
• Promotion : Detail your strategies for promoting your store and products.

This section gives a clear roadmap for how you’ll attract customers and make your business a success. Keep it straightforward and compelling.

Financial strategy and forecast

The “Financial strategy and forecast” section of your retail store business plan is where you show the money side of your business. Investors want to see the numbers, so include things like:

• Estimated capital requirements : How much money do you need to get started and keep going?
• Profit and revenue models : Explain how you plan to make money and what your sales goals are.
• Sales volume projections : Predict how many products you expect to sell.
• Financial statements : Include balance sheets, cash flow projections, and any other financial documents.

These details help investors understand your business’s financial health and potential. Make sure your numbers are realistic and based on careful research and planning.

Management structure

In the “Management structure” section of your retail store business plan, you’ll provide details on how you intend to organize your team and manage your business effectively. This section involves explaining several key aspects:

Firstly, you’ll specify the number of team members you plan to hire. This is essential to understand the size and scope of your workforce.

Secondly, you’ll describe the roles and responsibilities of each team member. This clarification ensures that everyone knows their specific duties and contributes to the smooth operation of the business.

Lastly, you’ll illustrate how each team member fits into your overall business plan. This section helps investors and stakeholders comprehend how your team will collaborate and work together to achieve the business’s goals and objectives. 

A well-defined retail management structure assures potential investors that you have a competent team ready to execute your business plan effectively.

Homebase offers user-friendly employee management tools to streamline team communication , time tracking, and scheduling , helping you refine your management structure. 

Common mistakes to avoid when making your retail store business plan 

A successful business plan is as much about what you leave out as what you put in. Here are some common mistakes to avoid:

Too much detail

Avoid long, rambling text. Use visuals and graphics when possible and attach heavy content as appendices.

Poor financial planning

Account for growing expenses, taxes, and market influences in your financial projections.

Poor spelling and grammar

Basic errors can undermine how partners and investors view your plan.

Strengthening your business plan

To strengthen your business plan, consider your audience, which may include potential investors, business partners, and financial institutions. Be transparent, avoid exaggerations, and demonstrate the value of your idea.

Conclusion: Finishing your retail store business plan

A well-crafted retail store business plan is more than just a guide; it’s a tool to attract investors, secure funding, and set the foundation for a successful retail business. Leveraging tools like Homebase can help you stay competitive and efficient in the retail industry.

Don’t delay writing your plan—it could be the first step towards realizing your retail business dreams.

FAQs about writing a retail store business plan

What is a retail store business plan, and why is it important.

A retail store business plan is a comprehensive document outlining your retail store business’s model, goals, and strategies. It’s crucial as it provides clarity, attracts investors, and guides daily operations for success.

How does a retail store business plan differ from other business plans?

Retail store business plans are unique due to their focus on inventory management, marketing tactics to attract shoppers, and growth strategies centered on expanding customer reach.

What should I include in my retail store business plan’s business overview section?

In the business overview, provide a concise description of your retail business, including its structure, location, and the products or services you intend to offer.

How can a retail store business plan help secure investment?

A retail store business plan demonstrates a well-thought-out strategy, outlining business goals, target market, competitive analysis, and financial projections. It reassures investors, making your venture a more appealing investment opportunity.

What common mistakes should I avoid when creating a retail store  business plan?

Common mistakes include excessive detail, poor financial planning, and grammar/spelling errors. To avoid these, focus on clarity, accurate financial projections, and proofreading.

Remember:  This is not legal advice. If you have questions about your particular situation, please consult a lawyer, CPA, or other appropriate professional advisor or agency.

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How to Write a Business Plan: Beginner’s Guide (& Templates)

Written by: Chloe West

Thinking about starting a business? One of the first steps you’ll need to take is to write a business plan. A business plan can help guide you through your financial planning, marketing strategy, unique selling point and more.

Making sure you start your new business off on the right foot is key, and we’re here to help. We’ve put together this guide to help you write your first business plan. Or, you can skip the guide and dive right into a business plan template .

Ready to get started?

Here’s a short selection of 8 easy-to-edit business plan templates you can edit, share and download with Visme. View more templates below:

8-Step Process for Writing a Business Plan

What is a business plan, why is a business plan important, step #1: write your executive summary, step #2: put together your company description, step #3: conduct your market analysis, step #4: research your competition, step #5: outline your products or services, step #6: summarize your financial plan, step #7: determine your marketing strategy, step #8: showcase your organizational chart, 14 business plan templates to help you get started.

A business plan is a document that helps potential new business owners flesh out their business idea and put together a bird’s eye view of their business. Writing a business plan is an essential step in any startup’s ideation process.

Business plans help determine demographics, market analysis, competitive analysis, financial projections, new products or services, and so much more.

Each of these bits of information are important to have on hand when you’re trying to start a business or pitching investors for funds.

Here’s an example of a business plan that you can customize to incorporate your own business information.

We’re going to walk you through some of the most important parts of your business plan as well as how to write your own business plan in 8 easy steps.

If you’re in the beginning stages of starting a business , you might be wondering if it’s really worth your time to write out your business plan. 

We’re here to tell you that it is.

A business plan is important for a number of reasons, but mostly because it helps to set you up for success right from the start.

Here are four reasons to prove to you why you need to start your business off on the right foot with a plan.

Reason #1: Set Realistic Goals and Milestones

Putting together a business plan helps you to set your objectives for growth and make realistic goals while you begin your business. 

By laying out each of the steps you need to take in order to build a successful business, you’re able to be more reasonable about what your timeline is for achieving everything as well as what your financial projections are.

The best way to set goals is using the SMART goals guidelines, outlined below.

Reason #2: Grow Your Business Faster

Having a business plan helps you be more organized and strategic, improving the overall performance of your business as you start out. In fact, one study found that businesses with a plan grow 30% faster than businesses that don’t.

Doesn’t that sound reason enough alone to start out your business venture with a solidified plan? We thought so too, but we’ve still got two more reasons.

Reason #3: Minimize Risk

Starting a new business is uncharted territory. However, when you start with a roadmap for your journey, it makes it easier to see success and minimize the risks that come with startups.

Minimize risk and maximize profitability by documenting the most important parts of your business planning.

Reason #4: Secure Funding

And finally, our last reason that business plans are so important is that if you plan to pitch investors for funding for your new venture, they’re almost always going to want to see a detailed business plan before deciding whether or not to invest.

You can easily create your business plan and investor pitch deck right here with Visme. Just sign up for a free account below to get started. 

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The executive summary is a brief overview of your entire business plan, giving anyone who reads through your document a quick understanding of what they’re going to learn about your business idea.

However, you need to remember that some of the people who are going to read your business plan don’t want to or have time to read the entire thing. So your executive summary needs to incorporate all of the most important aspects of your plan.

Here’s an example of an executive summary from a business plan template you can customize and turn into your own.

Your executive summary should include:

• Key objective(s)
• Market research
• Competitor information
• Products/services
• Value proposition
• Overview of your financial plan
• How you’re going to actually start your business

One thing to note is that you should actually write your executive summary after the rest of your business plan so that you can properly summarize everything you’ve already created.

So at this point, simply leave a page blank for your executive summary so you can come back to it at the end of your business plan.

The next step is to write out a full description of your business and its core offerings. This section of your business plan should include your mission statement and objectives, along with your company history or overview.

In this section, you may also briefly describe your business formation details from a legal perspective.

Mission Statement

Don’t spend too much time trying to craft this. Your mission statement is a simple “why” you started this business. What are you trying to achieve? Or what does your business solve?

This can be anything from one single quote or a paragraph, but it doesn’t need to be much longer than that. In fact, this could be very similar to your value proposition.

What are your goals? What do you plan to achieve in the first 90 days or one year of your business? What kind of impact do you hope to make on the market?

These are all good points to include in your objectives section so anyone reading your business plan knows upfront what you hope to achieve.

History or Overview

If you’re not launching a brand new business or if you’ve previously worked on another iteration of this business, let potential investors know the history of your company.

If not, simply provide an overview of your business, sharing what it does or what it will do.

Your third step is to conduct a market analysis so you know how your business will fit into its target market. This page in your business plan is simply meant to summarize your findings. Most of your time should be spent actually doing the research.

Your market analysis needs to look at things like:

• Market size, and if it’s grown in recent years or shrinking
• The segment of the market you plan to target
• Demographics and behavior of your target audience
• The demand for your product or service
• Your competitive advantage or differentiation strategy
• The average price of your product or service

Put together a summary of your market analysis and industry research in a 1-2 page format, like we see below.

Your next step is to conduct a competitive analysis. While you likely touched on this briefly during your market analysis, now is the time to do a deep dive so that you have a good grasp on what your competitors are doing and how they are generating customers.

Start by creating a profile of all your existing competitors, or at the very least, your closest competitors – the ones who are offering very similar products or services to you, or are in a similar vicinity (if you’re opening a brick and mortar store).

Focus on their strengths and what they’re doing really well so that you can emulate their best qualities in your own way. Then, look at their weaknesses and what your business can do better.

Take note of their current marketing strategy, including the outlets you see a presence, whether it’s on social media, you hear a radio ad, you see a TV ad, etc. You won’t always find all of their marketing channels, but see what you can find online and on their website.

After this, take a minute to identify potential competitors based on markets you might try out in the future, products or services you plan to add to your offerings, and more.

Then put together a page or two in your business plan that highlights your competitive advantage and how you’ll be successful breaking into the market.

Step five is to dedicate a page to the products or services that your business plans to offer.

Put together a quick list and explanation of what each of the initial product or service offerings will be, but steer clear of industry jargon or buzzwords. This should be written in plain language so anyone reading has a full understanding of what your business will do.

You can have a simple list like we see in the sample page above, or you can dive a little deeper. Depending on your type of business, it might be a good idea to provide additional information about what each product or service entails.

The next step is to work on the financial data of your new business. What will your overhead be? How will your business make money? What are your estimated expenses and profits over the first few months to a year? The expenses should cover all the spending whether they are recurring costs or just one-time LLC filing fees .

There is so much that goes into your financial plan for a new business, so this is going to take some time to compile. Especially because this section of your business plan helps potential cofounders or investors understand if the idea is even viable.

Your financial plan should include at least five major sections:

• Sales Forecast: The first thing you want to include is a forecast or financial projection of how much you think your business can sell over the next year or so. Break this down into the different products, services or facets of your business.
• Balance Sheet: This section is essentially a statement of your company’s financial position. It includes existing assets, liabilities and equity to demonstrate the company’s overall financial health.
• Income Statement: Also known as a profit and loss statement (P&L), this covers your projected expenses and revenue, showcasing whether your business will be profitable or not.
• Operating Budget: A detailed outline of your business’s income and expenses. This should showcase that your business is bringing in more than it’s spending.
• Cash Flow Statements: This tracks how much cash your business has at any given point, regardless of whether customers or clients have paid their bills or have 30-60+ days to do so.

While these are the most common financial statements, you may discover that there are other sections that you want to include or that lenders may want to see from you.

You can automate the process of looking through your documents with an OCR API , which will collect the data from all your financial statements and invoices.

The next step is coming up with a successful marketing plan so that you can actually get the word out about your business. 

Throughout your business plan, you’ve already researched your competitors and your target market, both of which are major components of a good marketing strategy. You need to know who you’re marketing to, and you want to do it better than your competition.

On this page or throughout this section of your business plan, you need to focus on your chosen marketing channels and the types of marketing content you plan to create.

Start by taking a look at the channels that your competitors are on and make sure you have a good understanding of the demographics of each channel as well. You don’t want to waste time on a marketing channel that your target audience doesn’t use.

Then, create a list of each of your planned marketing avenues. It might look something like:

• Social media ( Facebook, Instagram, Pinterest)
• Email newsletter
• Digital ads

Depending on the type of business you’re starting, this list could change quite a bit — and that’s okay. There is no one-size-fits-all marketing strategy, and you need to find the one that brings in the highest number of potential customers.

Your last section will be all about your leadership and management team members. Showcasing that you have a solid team right from the start can make potential investors feel better about funding your venture.

You can easily put together an organizational chart like the one below, with the founder/CEO at the top and each of your team leaders underneath alongside the department they’re in charge of.

Simply add an organizational chart like this as a page into your overall business plan and make sure it matches the rest of your design to create a cohesive document.

If you want to create a good business plan that sets your new business up for success and attracts new investors, it’s a good idea to start with a template. 

We’ve got 14 options below from a variety of different industries for you to choose from. You can customize every aspect of each template to fit your business branding and design preferences.

If you're pressed for time, Visme's AI business plan generator can churn out compelling business plans in minutes. Just input a detailed prompt, choose the design, and watch the tool generate your plan in a few seconds.

Template #1: Photography Business Plan Template

This feminine and minimalistic business plan template is perfect for getting started with any kind of creative business. Utilize this template to help outline the step-by-step process of getting your new business idea up and running.

Template #2: Real Estate Business Plan Template

Looking for a more modern business plan design? This template is perfect for plainly laying out each of your business plans in an easy-to-understand format. Adjust the red accents with your business’s colors to personalize this template.

Template #3: Nonprofit Business Plan Template

Creating a business and marketing plan for your nonprofit is still an essential step when you’re just starting out. You need to get the word out to increase donations and awareness for your cause.

Template #4: Restaurant Business Plan Template

If your business plan needs to rely heavily on showcasing photos of your products (like food), this template is perfect for you. Get potential investors salivating at the sight of your business plan, and they’re sure to provide the capital you need.

Template #5: Fashion Business Plan Template

Serifs are in. Utilize this template with stunning serif as all the headers to create a contemporary and trendy business plan design that fits your business. Adjust the colors to match your brand and easily input your own content.

Template #6: Daycare Business Plan Template

Creating a more kid-friendly or playful business? This business plan template has bold colors and design elements that will perfectly represent your business and its mission. 

Use the pages you need, and remove any that you don’t. You can also duplicate pages and move the elements around to add even more content to your business plan.

Template #7: Consulting Business Plan Template

This classic business plan template is perfect for a consulting business that wants to use a stunning visual design to talk about its services.

Template #8: Coffee Shop Business Plan Template

Customize this coffee shop business plan template to match your own business idea. Adjust the colors to fit your brand or industry, replace photos with your own photography or stock photos that represent your business, and insert your own logo, fonts and colors throughout.

Template #9: SaaS Business Plan Template

A SaaS or service-based company also needs a solid business plan that lays out its financials, list of services, target market and more. This template is the perfect starting point.

Template #10: Small Business Plan Template

Every startup or small business needs to start out with a strong business plan in order to start off on the right foot and set yourself up for success. This template is an excellent starting point for any small business.

Template #11: Ecommerce Business Plan Template

An ecommerce business plan is ideal for planning out your pricing strategy of all of your online products, as well as the site you plan to use for setting up your store, whether WordPress, Shopify, Wix or something else.

Template #12: Startup Business Plan Template

Customize this template and make it your own! Edit and Download  

This is another generic business plan template for any type of startup to customize. Switch out the content, fonts and colors to match your startup branding and increase brand equity.

Template #13: One-Page Business Plan Template

Want just a quick business plan to get your idea going before you bite the bullet and map out your entire plan? This one-page template is perfect for those just starting to flesh out a new business idea.

Template #14: Salon Business Plan Template

This salon business plan template is easy on the design and utilizes a light color scheme to put more focus on the actual content. You can use the design as is or keep it as a basis for your own design elements.

Create Your Own Business Plan Today

Ready to write your business plan? Once you’ve created all of the most important sections, get started with a business plan template to really wow your investors and organize your startup plan.

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About the Author

Chloe West is the content marketing manager at Visme. Her experience in digital marketing includes everything from social media, blogging, email marketing to graphic design, strategy creation and implementation, and more. During her spare time, she enjoys exploring her home city of Charleston with her son.

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What is a business plan?

1. write an executive summary, 2. describe your company, 3. state your business goals, 4. describe your products and services, 5. do your market research, 6. outline your marketing and sales plan, 7. perform a business financial analysis, 8. make financial projections, 9. summarize how your company operates, 10. add any additional information to an appendix, business plan tips and resources.

A business plan outlines your business’s financial goals and explains how you’ll achieve them over the next three to five years. Here’s a step-by-step guide to writing a business plan that will offer a strong, detailed road map for your business.

LLC Formation

A business plan is a document that explains what your business does, how it makes money and who its customers are. Internally, writing a business plan should help you clarify your vision and organize your operations. Externally, you can share it with potential lenders and investors to show them you’re on the right track.

Business plans are living documents; it’s OK for them to change over time. Startups may update their business plans often as they figure out who their customers are and what products and services fit them best. Mature companies might only revisit their business plan every few years. Regardless of your business’s age, brush up this document before you apply for a business loan .

» Need help writing? Learn about the best business plan software .

This is your elevator pitch. It should include a mission statement, a brief description of the products or services your business offers and a broad summary of your financial growth plans.

Though the executive summary is the first thing your investors will read, it can be easier to write it last. That way, you can highlight information you’ve identified while writing other sections that go into more detail.

» MORE: How to write an executive summary in 6 steps

Next up is your company description. This should contain basic information like:

Your business’s registered name.

Address of your business location .

Names of key people in the business. Make sure to highlight unique skills or technical expertise among members of your team.

Your company description should also define your business structure — such as a sole proprietorship, partnership or corporation — and include the percent ownership that each owner has and the extent of each owner’s involvement in the company.

Lastly, write a little about the history of your company and the nature of your business now. This prepares the reader to learn about your goals in the next section.

» MORE: How to write a company overview for a business plan

The third part of a business plan is an objective statement. This section spells out what you’d like to accomplish, both in the near term and over the coming years.

If you’re looking for a business loan or outside investment, you can use this section to explain how the financing will help your business grow and how you plan to achieve those growth targets. The key is to provide a clear explanation of the opportunity your business presents to the lender.

For example, if your business is launching a second product line, you might explain how the loan will help your company launch that new product and how much you think sales will increase over the next three years as a result.

» MORE: How to write a successful business plan for a loan

In this section, go into detail about the products or services you offer or plan to offer.

You should include the following:

An explanation of how your product or service works.

The pricing model for your product or service.

The typical customers you serve.

Your supply chain and order fulfillment strategy.

You can also discuss current or pending trademarks and patents associated with your product or service.

Lenders and investors will want to know what sets your product apart from your competition. In your market analysis section , explain who your competitors are. Discuss what they do well, and point out what you can do better. If you’re serving a different or underserved market, explain that.

Here, you can address how you plan to persuade customers to buy your products or services, or how you will develop customer loyalty that will lead to repeat business.

Include details about your sales and distribution strategies, including the costs involved in selling each product .

» MORE: R e a d our complete guide to small business marketing

If you’re a startup, you may not have much information on your business financials yet. However, if you’re an existing business, you’ll want to include income or profit-and-loss statements, a balance sheet that lists your assets and debts, and a cash flow statement that shows how cash comes into and goes out of the company.

Accounting software may be able to generate these reports for you. It may also help you calculate metrics such as:

Net profit margin: the percentage of revenue you keep as net income.

Current ratio: the measurement of your liquidity and ability to repay debts.

Accounts receivable turnover ratio: a measurement of how frequently you collect on receivables per year.

This is a great place to include charts and graphs that make it easy for those reading your plan to understand the financial health of your business.

This is a critical part of your business plan if you’re seeking financing or investors. It outlines how your business will generate enough profit to repay the loan or how you will earn a decent return for investors.

Here, you’ll provide your business’s monthly or quarterly sales, expenses and profit estimates over at least a three-year period — with the future numbers assuming you’ve obtained a new loan.

Accuracy is key, so carefully analyze your past financial statements before giving projections. Your goals may be aggressive, but they should also be realistic.

NerdWallet’s picks for setting up your business finances:

The best business checking accounts .

The best business credit cards .

The best accounting software .

Before the end of your business plan, summarize how your business is structured and outline each team’s responsibilities. This will help your readers understand who performs each of the functions you’ve described above — making and selling your products or services — and how much each of those functions cost.

If any of your employees have exceptional skills, you may want to include their resumes to help explain the competitive advantage they give you.

Finally, attach any supporting information or additional materials that you couldn’t fit in elsewhere. That might include:

Licenses and permits.

Equipment leases.

Bank statements.

Details of your personal and business credit history, if you’re seeking financing.

If the appendix is long, you may want to consider adding a table of contents at the beginning of this section.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Here are some tips to write a detailed, convincing business plan:

Avoid over-optimism: If you’re applying for a business bank loan or professional investment, someone will be reading your business plan closely. Providing unreasonable sales estimates can hurt your chances of approval.

Proofread: Spelling, punctuation and grammatical errors can jump off the page and turn off lenders and prospective investors. If writing and editing aren't your strong suit, you may want to hire a professional business plan writer, copy editor or proofreader.

Use free resources: SCORE is a nonprofit association that offers a large network of volunteer business mentors and experts who can help you write or edit your business plan. The U.S. Small Business Administration’s Small Business Development Centers , which provide free business consulting and help with business plan development, can also be a resource.

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Ecommerce may be booming but opening and running successful shops and retail companies of the bricks-and-mortar variety is still a life goal for many.

If you’re planning to make that dream a reality, writing a thorough business plan should be at the top of your to-do list — here’s why.

What is a business plan?

Your business plan is essentially your company’s strategic blueprint. It explains what your business idea is and sets out your goals and how you will achieve them, while considering the environment you’ll operate in.

Typically, it’s the first proper step of getting your retail business off the ground and can be used to get investors, grants, loans or other funding for your company before you open your shop doors.

Something that can also help your planning is a Business Model Canvas . It is a handy tool to help you build out your business plan.

Your one stop shop for starting a business

Thinking about starting a business or already putting your ideas into action? We’ve got the resources, expertise and software to help you achieve your goals.

Do independent shops really need a business plan?

The short answer is yes. Of course it’s possible to do well with a good idea and a bit of luck but you’re more likely to succeed with a solid business plan to help guide your decision-making. Researching your plan will also help you figure out if your products or services are financially viable and in demand before you launch. Here are three things to consider as part of your business planning process:

1. Location, location, location

For shops and retail companies, whether you’re opening a community greengrocer or an exclusive boutique, one of the most important aspects of your business model is your location. Pulling a plan together will encourage you to think about the most viable location for success, as well as the cost implications.

2. Customers

When creating your business plan, you’ll need to research your potential customers. Documenting who they are, how they behave and the circumstances in which they will shop with you will aid you in determining the stock you will carry and how to effectively promote your store to customers.

3. Pricing model

A big part of any business plan is the financial figures that are included. As part of the planning process, you should be doing detailed research on potential competitors and their prices as well as all the expenses that running your business will incur. This will help you determine the prices that you will charge for the products you sell.

What are the other benefits to having a business plan?

• It looks good to potential partners, investors, lenders and funding bodies, and if you want to apply for a business loan, you’ll most likely need a business plan.
• It will help you work out what your unique selling proposition is, identify threats and challenges, and come up with solutions and coping strategies.
• It will make you set short and long-term SMART goals, such as launching a new website within three months or opening a second shop in year three of trading.
• You can use it to benchmark your performance by comparing your company’s results and achievements with the goals set out in your plan.

If you want to increase the chances of your business being successful, it’s worth having a business plan

How to write a business plan for your shop

Your business plan doesn’t have to be a boring document. Given some investors make their decision to provide funding to start-ups and existing firms based on the people as much as the business itself, your business plan should showcase your passion and personality.

However, certain bodies or individuals who can provide funding will expect you to include specific information. Putting your plan together using the following sections can help you make a strong case for securing the required finance:

• Executive summary
• Business overview
• Audience and market
• Products and services

As we’ve discussed, your business plan will be critical to you running a profitable shop, which is all the more reason to ensure that you are thorough in your approach. Here are some top tips for writing your plan:

Be realistic

It’s unlikely that you will be profitable straight away and sales may show steady growth rather than a massive spike. If your plan includes figures that seem unrealistic, you should justify them.

Accuracy is key

As your business plan will help you make decisions, it’s important the information you base those decisions on is correct. Double check everything. We have some great advice on how to get more accurate figures for your business plan .

As your plan will be used to help you manage your retail business and potentially be shared with others, it’s important to avoid waffle. You can always make use of appendices for supplementary information.

Want help with business plan for shops and retail companies?

Your accountant may be able to give you tips and ideas, or ask your bank if they have a small business adviser you could talk to. If you’re ready to start your research and writing, why not use an online template?

To help you out, we’ve created a business plan template specifically for shops and retail companies with physical stores. It’s free to download and takes you through the process step by step with detailed guidance notes.

Don’t forget that your plan should evolve with your business, so you should revisit and update it regularly. Good luck!

Want to create a business plan for your shop or retail company but not sure how to do it? Download our free and easy-to-use business plan template and you can get started.

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Dreaming of opening a coffee shop ? You’re not alone. The coffee industry is bustling with passionate business owners eager to make their mark. However, becoming successful coffee shop owners requires more than just a love for the brew. It demands a clear vision that differentiates your coffee house in a saturated market. A well-crafted business plan not only gives life to your idea but also sets your business on a path to thrive. Whether you’re a newbie or a seasoned entrepreneur, this guide, complete with a free template, will help you craft a business plan that markets and propels your coffee venture to success.

What is A Coffee Shop Business Plan?

A coffee shop business plan is a comprehensive document that explains what your business idea is, how you intend to penetrate the coffee market, and the strategies you’ll employ to run your coffee shop successfully. When opening a cafe, many aspiring cafe or coffee shop owners underestimate the value of a structured plan. However, this document does more than just outline the needs to open a coffee shop; it gives a detailed roadmap for your new business, offering clarity on every aspect of its operation.

More than that, presenting a well-structured business plan to potential investors is essential. It not only showcases your commitment but also your understanding of the industry, making it a vital tool for securing funding. While crafting a business plan can seem daunting initially, it’s the foundation that both clarifies your idea and sets your business on the trajectory for growth and success in the competitive world of cafes and coffee shops.

Why A Business Plan Is Important For A Successful Coffee Shop Business?

1. Clear Vision and Objectives

When you set up your coffee shop, having a business plan establishes a clear vision and defines your objectives. It is the backbone that steers every decision you’ll make. Without a clear outline, you may find yourself swaying from one idea to the next. With a detailed business plan, you can present a clear business proposal to stakeholders, ensuring them and yourself of the path you plan to tread.

2. Financial Planning

A comprehensive business plan is imperative for accurate financial planning. It will include information on how much capital is required to start, what your ongoing costs will be, and the revenues you plan to generate. If you’re seeking external funding, investors will want to see how you plan to use their money, and most importantly, how you plan to make a return on that investment. If you plan to sell specialty blends or unique treats, the financial section can also help you plan a strategy for pricing, promotion, and sales forecasts.

3. Operational Efficiency

Operational efficiency is the linchpin that holds all business operations together. A business plan will map out every detail, from supplier agreements to employee schedules. You may want to create special events or loyalty programs for regular customers, and this is where a business plan can help you plan a strategy for success. It becomes the reference point, ensuring that daily tasks align with the broader objectives, guaranteeing that resources, time, and efforts are used optimally.

Step-by-step Guide To Write A Coffee Shop Business Plan

1. Executive Summary

The Executive Summary is like the introduction of a novel – it provides a snapshot of what is to come. Typically, you write the executive summary last, even though it appears first in your business plan. It encapsulates the essence of your coffee shop’s mission, objectives, and financial overview, succinctly explaining what your business concept is about. This section is crucial because many coffee shops fail to engage potential investors right off the bat. Ideally, it should be concise – a page or two.

What should you cover in an Executive Summary?

• Introduce Your Coffee Shop or Cafe: Provide a company overview, giving readers insight into what makes your coffee shop unique from the myriad of coffee bars in the market.
• State Your Mission and Vision: Describe what drives your coffee business and where you see it in the future.
• Outline Your Objective: Define clear, measurable goals that you aim to achieve.
• Provide a Financial Overview: Highlight projected profit margins, a brief balance sheet, and other pertinent financial data.

2. Coffee Shop Business Description

This section paints a picture of your coffee shop. It’s where you elaborate on how you plan to infuse the local coffee market with your unique brews and pastries.

What should you cover in the Coffee Shop Description section?

• Coffee Shop Concept: Dive into the types of coffee drinks you plan to offer, whether it’s a rich espresso or a classic brewed coffee.
• Unique Selling Proposition: Discuss what makes your coffee shop stand out, be it a special blend of coffee beans, a unique roasting method using a specific coffee roaster, or artisanal pastry offerings.
• Operational Plan: Briefly touch upon how you’ll manage your coffee shop, from sourcing beans to serving cups of coffee.

3. Market Analysis

Before pouring your first espresso, performing market research before starting your coffee business is essential. This section dives deep into understanding your potential customer base and the coffee industry landscape in your area.

What should you cover in this section?

• Target Market: Describe your ideal customer. Are they local residents, office workers, or students?
• Location: Discuss the significance of your chosen location. Are there many coffee shops in the area? How does your location cater to your target market?
• Competition: Analyze existing coffee shops. What coffee and food products do they offer? What pricing strategy do they employ? How will your coffee shop compete or complement them?

4. Organization and Management

Behind every successful coffee shop is a robust organizational structure and a competent management team.

What should you cover in the Organization and Management Plan?

• Coffee Shop Ownership Information: Highlight the business’s legal structure.
• Profiles of Your Coffee Shop Management Team: Include details about your baristas, perhaps a part-time accountant, and someone to manage marketing. It can be helpful to create profiles for each role, detailing responsibilities and expertise.

5. Sample Menu

Your menu is the heart of your coffee shop. It’s more than just a list of coffee and tea; it’s an expression of your brand.

What should you consider when creating a Sample Menu?

• Menu Items: Detail the types of coffee, espresso drinks, and pastries you plan to offer. Maybe consider including non-coffee items like teas or specialty drinks.
• Unique Selling Proposition: Reiterate what makes your coffee or food items different from other coffee shops in the area.
• Menu Pricing : Discuss your pricing strategy, keeping in mind profit margin, competitors’ prices, and your target customer base.

6. Marketing Plan

To brew success, it’s not enough to have a fantastic coffee product; you must effectively market it.

What should you cover in a Marketing Strategy for your Coffee Shop Business?

• Define Your Brand: What voice, theme, or emotion do you want your coffee shop to evoke?
• Lay out your plans for social media campaigns, local partnerships, loyalty programs, SEO for website, and other promotional strategies.
• Considering using an  online food ordering system  in your food truck
• Create a  digital menu with QR code  to make your menu easy for your customers to access online

7. Operations Plan

Efficiency is key to the daily grind of running a cafe. The operations section provides a detailed look at the day-to-day operations of your coffee shop business.

What Operational Issues should you address in your Business Plan?

• Supply Chain: Where will you buy your coffee beans? Who will be your coffee roaster?
• Operating Hours: Consider the best times to cater to your target market.
• Staffing: Detail roles, such as barista, manager, and part-time support.
• Equipment: List down essential equipment, from espresso machines to ovens.

8. Financial Plan

In this crucial section of your business plan, delving into the financial specifics is paramount to lay out a concrete roadmap for the fiscal aspects of your coffee shop.

How Much Does It Cost to Start a Coffee Shop?

Starting a coffee shop is not just about brewing the perfect espresso; it’s also a substantial financial commitment. The cost for opening a coffee shop can range from $80,000 to $250,000. These costs can vary widely based on factors such as location, size of the establishment, equipment quality, and inventory requirements. Moreover, the process of opening a coffee shop might also involve unexpected expenditures, so it’s essential to account for some buffer in your budget.

How Many Ways to Fund Your Coffee Shop?

There are multiple avenues for funding your coffee venture. Traditional bank loans, personal savings, angel investors, crowdfunding campaigns, and partnerships are just a few options. It’s crucial to assess which option aligns best with your business vision and financial situation.

Important Questions to Consider When You Create Your Funding Request If you’re seeking funding, there are several questions you’ll need to answer in your business plan:

• How much money do you need to start and maintain your coffee shop until it becomes profitable?
• What will the funds be used for specifically?
• How do you plan to handle financial challenges that might arise?
• How do you plan to repay any loans or provide a return on investment?

9. Financial Projections

The financial projections section of your business plan forces you to translate your coffee shop vision into numbers, ensuring you’ve accounted for all key metrics that can make or break your venture.

Break-even analysis:

This is the point where your coffee shop’s total revenues equal its total costs. Simply put, it’s when you neither make a profit nor a loss from selling coffee.

Use this formula:  Fixed Costs / (Price – Variable Costs) = Break Even Point

Projected profit and loss statement:

This will provide a forecast of your expected income and expenses, giving a clear view of your venture’s profitability.

Cash flow analysis:

Essential for understanding the liquidity of your business, this tool is especially crucial for coffee shops, considering the fluctuating expenses and incomes coffee shops offer. When drafting this, consider who will read it, as stakeholders like investors or lenders might have specific expectations.

Coffee Shop Business Plan Template

• Mission: To offer the community high-quality coffee in a comfortable and vibrant environment.
• Vision: To become the go-to local coffee spot that fosters community connections and coffee appreciation.
• Coffee Shop Description: “Java Junction” will be a modern coffee hub that emphasizes direct-trade coffee beans and a relaxed, inclusive atmosphere.
• Costs: Estimated initial costs are $125,000.
• Profits: Projected annual profit by year two is $75,000.

2. Description of the Coffee Shop

• Coffee Shop Concept: A community-focused café emphasizing artisanal methods.
• Coffee Shop Name: Java Junction. (Consider using a coffee shop name generator for more ideas).
• Coffee Shop Type: Sit-down café with an adjacent mini-library.
• Location: Main Street, Downtown Area – chosen for its high foot traffic.
• Order Fulfillment: Orders taken at the counter with table service for food.
• Working Hours: Mon-Fri (7 am – 9 pm), Sat-Sun (8 am – 10 pm).

3. Menu Offer

• Type of Food and Drink: Coffee, teas, pastries, and sandwiches.
• Offer: From classic espresso shots to unique blends like “Lavender Latte”.
• Unique Selling Point: Every coffee product uses direct-trade beans, ensuring farmer fairness.

4. Market and Competition Analysis

• Market Analysis: The local population includes a mix of professionals, students, and tourists. Many search for quiet spots to work or relax.
• Target Customer: Professionals aged 25-40 and students.
• Size of the Target Customer: Approximately 15,000 individuals.
• Competition Analysis: Three established coffee shops within a mile.
• Size of the Competition: Ranging from small boutique coffee shops to a larger chain.
• Competitors’ Offer: Basic coffee drinks, with limited specialty items.
• Competitors’ Prices: Average of $4 for a coffee drink.

5. Investment Plan (Detailed Cost Analysis)

• Equipment: $30,000
• Renovations: $20,000
• Initial Stock: $10,000
• Licenses: $5,000
• Miscellaneous: $10,000
• Rent: $3,000
• Salaries: $10,000
• Utilities: $1,000
• Stock: $2,000
• Marketing: $1,000

6. Financial Forecast

Year one is projected to break even, with a profit of $50,000 expected in year two, and $75,000 in year three, considering growth and expanding customer base.

• Owner: Jamie Smith, a coffee enthusiast with a business degree.
• Manager: Alex Brown, previously managed a successful coffee chain for five years.
• Baristas: A team of 4 skilled individuals passionate about coffee.

8. Marketing Plan

Java Junction will use a mix of social media marketing, local print advertising, and loyalty programs to attract and retain customers. Regular events, such as “Buy Our Coffee Day” and collaboration with local businesses, will drive foot traffic and community engagement, integral components for starting your coffee shop and making it successful.

This coffee shop business plan sample is hypothetical and serves as a template. Tailoring specifics to your local market, vision, and unique aspects will be necessary. Every coffee shop has nuances that can make them successful, whether it be the coffee products they sell, the environment they cultivate, or the events they host. Focus on what will make your coffee shop stand out and be sure to engage your community.

Tips For Writing a Business Plan For a Coffee Shop

Your business plan becomes the blueprint of your vision. Here are essential tips to consider:

• Comprehensiveness is Key: Ensure your plan encompasses all sections you should include, such as marketing, financial projections, and operations. A well-rounded plan provides a holistic view of your business.
• Tailor to Your Audience: If you’re presenting to potential investors, focus on profitability and growth projections. For a landlord, emphasize the benefits your coffee shop will bring to their property.
• Specialize in Marketing: Given the competitiveness in the coffee industry, it’s crucial to have a solid marketing plan. If marketing isn’t your strength, consider hiring someone to do marketing for your venture. A strong online presence, loyalty programs, and community engagement can set you apart.
• Research Your Market: Understand what nearby coffee shops include in their offerings. Identify gaps in the market and strategize on how your shop can fill them.
• Stay Flexible: While a business plan provides direction, remain adaptable. The coffee industry is dynamic, and your ability to pivot can prove invaluable.
• Separate Sections for Clarity: If your plan becomes too dense, you might want to create a separate document for specific sections like a detailed marketing strategy or an in-depth market analysis. This makes your primary business plan concise and more readable.

Frequently Asked Questions

1. how profitable is owning a coffee shop.

Owning a coffee shop can be profitable, depending on factors like location, quality of products, and management. On average, after expenses, many coffee shops report a profit margin of around 3% to 5%, with some successful ones achieving even higher. However, it’s essential to factor in initial setup costs, ongoing expenses, and market competition.

2. How do I start a coffee shop business plan?

Starting a coffee shop business plan involves multiple steps. Begin by defining your coffee shop’s mission and vision. Conduct market research to understand your target audience and competitors. Then, detail out sections like your product offerings, pricing strategy, marketing plan, financial projections, and operational procedures. If you’re thinking of opening a coffee shop, a well-thought-out business plan is indispensable.

3. What is a business plan for a coffee shop?

A coffee shop business plan is a detailed document that outlines your coffee shop’s objectives, strategies, and operational procedures. It acts as a roadmap, guiding you from the startup phase to establishing a thriving business. Moreover, if you need a coffee shop business loan or investment, this plan becomes crucial in convincing stakeholders of your venture’s viability.

4. What are the 4Ps in a coffee shop business plan?

The 4Ps stand for Product, Price, Place, and Promotion. In the context of a coffee shop:

• Product: What type of coffee and related products will you offer?
• Price: How will you price your coffee? Will it be premium or competitive?
• Place: Where will your coffee shop be located? Is it accessible to your target audience?
• Promotion: How will you market your coffee shop? Will you offer promotions or loyalty programs?

These elements help in creating a marketing strategy tailored to your coffee shop’s unique needs and market position.

Related Coffee Shop Resources

• How to start a coffee shop with no money
• How much do coffee shop owners make
• Coffee shop names
• Coffee shop name generator

Launching a coffee shop is not just about brewing the perfect cup but weaving a narrative that resonates with your community, fostering an ambiance that people gravitate towards, and maintaining a seamless operation that drives profitability. The meticulous creation of a business plan is a pivotal step in this endeavor. It’s the beacon that guides budding entrepreneurs through the complexities of the coffee industry. In such a competitive marketplace, a well-structured, comprehensive business plan can make the difference between a fleeting venture and a thriving institution. To potential coffee shop owners, embrace the process, let your passion shine through in your plan, and remember that every great coffee shop started with a simple idea, much like a single coffee bean ready to brew greatness.

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How To Write a Thrift Store Business Plan in 9 Steps

by ThriftCart | Aug 21, 2024

Have you ever wanted to run your own thrift store or secondhand shop? With the right approach, your thrift businesses can be successful and profitable. If you’re interested in becoming a thrift store owner, you’ll need a business plan that outlines your objectives and vision. 

Follow this step-by-step thrift store business plan template and turn your startup thrift shop into a successful venture your customers will enjoy visiting.

Step One: Create an Executive Summary

An executive summary is a brief look into what your business is all about. It summarizes everything from business objectives to the types of products you want to sell and the experiences you want to convey to your customers. You should include these elements in your thrift shop’s summary:

• Mission Statement: Explain what your thrift shop hopes to achieve and what makes it stand out. For instance, you might open a thrift store to offer your local community affordable, gently-used clothing, with the sales proceeds supporting a nearby humane society for pets.
• Business Goals: Outline what success will look like for your thrift shop, when you expect it to turn a profit, and if you plan to expand to additional locations.
• Business Focus: Detail what items your shop specializes in and the shopping experience you want to provide your customers.
• Financial Overview: You’ll need to outline the initial funding required to cover all startup costs for your thrift business. Then, provide an estimated revenue projection for the first year to demonstrate its expected profitability.

Potential stakeholders in your thrift store, such as partners looking to financially support your nonprofit organization and its mission, often read the executive summary first. Keep each point concise, clear, and compelling to maximize the chances of getting them on board. The summary must achieve two objectives: demonstrating the thrift shop can be run as a profitable business and explaining how it advances the nonprofit’s goals.

Step Two: Write a Business Overview

Think of your thrift store’s business overview as its business card, introducing its essential details at a glance. It should include:

• The business’ complete name
• Geographic location
• Business structure , such as 501(c)(3) organization, sole proprietorship, LLC, or corporation
• Short version of the mission statement
• Brief explanation of the shop’s purpose, core values, and future goals

Potential partners and investors use your business overview to understand your shop’s identity and what sets it apart from other thrift shops.

Step Three: Conduct Industry and Market Analysis

Starting a thrift store is a challenge. The thrift store industry is a competitive environment with a mix of different business types. Depending on your location and target market, your competitors may include independent mom-and-pop stores, online ventures, or large and established chains like Goodwill and Savers.

Research the current state of the thrift shop industry and check out what businesses local customers turn to when they want to go thrifting. Then, analyze the type and number of competitors. 

Are they primarily independent businesses, or are there bigger chain stores? How many are there in your region? These market research details can help you find a way to differentiate your thrift business and offer items, services, and experiences the competition doesn’t.

Step Four: Perform a Thrift Customer Analysis

All kinds of people love to go thrifting. Look into what type of customers like to visit secondhand shops and analyze their demographics , purchasing behaviors, and reasons for going thrifting.

Are local thrifters budget-conscious customers looking for a great deal, or are they visiting thrift shops to reduce waste and be eco-conscious shoppers? Do they look for vintage items and one-of-a-kind objects, or do they stick to wardrobe staples? The answers can help you understand what your customers are like and how best to answer their needs.

Step Five: Describe Products and Services

Decide whether to specialize in specific items, such as used clothing and accessories, or run your business like a secondhand general store offering a wide variety of goods.

Besides choosing what products to sell, consider providing additional services to your customers to encourage more sales, like donation drop-off points, repairs, and loyalty programs. Choose your approach based on the local community’s needs, giving your customers what they expect while standing out from competing businesses.

Step Six: Outline an Operations Plan

An operations plan is a guide detailing everything your store needs to run smoothly on any given business day. Most operational plans for thrift businesses include:

• Inventory management: Determine the tools and systems the store needs to sort, price, and categorize items. An all-in-one POS system built for thrift stores is ideal and often includes powerful tools to help you automate or streamline inventory management. For instance, they include donation processing tools designed to sort all the items your store will handle.
• Pricing and discounting strategies: Develop strategies to group items into bundles or categorize them by type, color, theming, or other descriptors. These strategies can help you create exclusive deals or seasonal discounts, attracting customers looking to score deals. Regular deals and discounts incite deal-hunting customers to return to your store more frequently, naturally building loyalty and creating anticipation for your store’s next discounts.
• Donation processing: Establish the store’s procedures to source, accept, and sort donated items.
• Staff and training: Define roles, responsibilities, and training standards for each staff member.
• Store layout: Organize your store’s space and determine how items are grouped and showcased to visitors as they navigate your thrift store.
• Customer service: Set guidelines for greeting customers, managing transactions, offering services and assistance, and contributing to a positive shopping experience.
• Finances and budgeting: Detail your store’s procedures for tracking sales and transactions, managing revenues and expenses, and ensuring long-term profitability.

Your shop’s operations plan is the framework for managing a typical business day. A well-designed plan encourages repeated business and keeps thrifters coming back so your store can turn a profit. 

Step Seven: Develop a Marketing Plan

Your thrift store’s marketing plan is similar to its operations plan, but specific to marketing and advertising efforts. It should include the strategies your shop will use to increase foot traffic, establish a loyal customer base, and make the store profitable long-term. 

Consider all of the following in your marketing plan:

• Branding and Identity: Design your store’s logo, signage, lettering, interior theming, and colors.
• Advertising: Choose how you will promote your store, what advertising channels and digital marketing tools you’ll use, and what messages and values to convey.
• Promotions: Offer loyalty programs to attract customers or entice new business with deals and promotion codes on specific items.

A solid marketing plan should present your secondhand shop in the best possible light. Besides attracting new customers, it contributes to your store’s brand identity, making it more visible and creating a positive reputation.

Step Eight: Identify Your Management Team

The success of your thrift store ultimately comes down to who is running the day-to-day operations. As part of your business plan, you need to identify the staff members who will manage your thrift store, including information on their education, managerial skill set, and industry experience.

Highlight your managers’ backgrounds, showcase how their talents will contribute to the store’s success, and outline their total compensation plan. A credible, trustworthy team will show your investors and partners that your thrift store business is in good hands — and ready to grow into a successful venture!

Step Nine: Build a Financial Plan

Develop a financial plan to get the approval of your investors and potential partners. Your plan should expand on the initial estimates and financial projections in your executive summary with more details. 

Outline your shop’s projected expenses and expected revenues so you can assess its profitability over time. Include initial startup purchases and operational spending, like salaries, utilities, and maintenance, in your expenses. 

The data will help you estimate how long your business will take to break even, generate financial returns, and become a successful thrift store.

Set Up Your Thrift Store for Success With ThriftCart

A good thrift store business plan is the right solution to turn an idea into a money-making venture. Everything that makes a successful business should be accounted for and planned, from the basic details to day-to-day operations, customer analysis, marketing, and team management. Once you’re confident in your business plan, it’s time to think about the technology that will support your operations. Every retail store needs a point of sale (POS) solution, and the best in the industry is ThriftCart. Our POS software was developed specifically for nonprofit thrift stores and can support your startup from day one. Book a demo today and discover a simpler, better way to manage your thrift shop’s inventory, operations, finances, and marketing!

Restaurant Management Blog

How to Start a Coffee Shop Business Plan

Starting a coffee shop is a popular entrepreneurial venture due to the growing demand for specialty coffee and a comfortable place for social interaction. A well-structured business plan is crucial for the success of any coffee shop. It serves as a roadmap, guiding you through the process of starting and growing your business. Below is a comprehensive guide to help you develop a business plan for a coffee shop.

1. Executive Summary

The executive summary is the first section of your business plan but should be written last. It provides a concise overview of your business plan and should capture the essence of your coffee shop.

• Mission Statement: Define the purpose of your coffee shop. For example, “To provide a cozy and inviting space where customers can enjoy high-quality coffee, local pastries, and a friendly atmosphere.”
• Vision Statement: Describe the long-term vision for your coffee shop, such as expanding to multiple locations or becoming a well-known community hub.
• Business Objectives: Outline your short-term and long-term goals. These could include achieving profitability within a year, building a loyal customer base, or gaining recognition as a top coffee shop in your area.

2. Company Description

This section provides more detailed information about your coffee shop.

• Business Structure: Indicate the legal structure of your business (e.g., sole proprietorship, partnership, LLC, corporation).
• Ownership: Describe who owns the business and their respective roles.
• Location: Mention the physical location of your coffee shop or the planned location if you haven’t secured it yet. Discuss why this location is ideal (e.g., high foot traffic, proximity to offices, etc.).
• Products and Services: Provide an overview of what your coffee shop will offer. This includes coffee, tea, pastries, light meals, and any other products or services like catering or coffee beans for sale.
• Unique Selling Proposition (USP): Explain what sets your coffee shop apart from competitors. It could be your unique coffee blends, eco-friendly practices, or a specific theme.

3. Market Analysis

Conducting thorough market research is essential to understanding your target market and competition.

• Industry Overview: Discuss the coffee shop industry, including trends, market size, and growth potential.
• Target Market: Identify your ideal customers. Consider demographics (age, gender, income), psychographics (lifestyle, interests), and behaviors (frequency of coffee consumption, preference for specialty coffee).
• Market Need: Explain the demand for your coffee shop in the chosen location. Highlight any gaps in the market that your coffee shop will fill.
• Competitive Analysis: Analyze your competitors, including direct (other coffee shops) and indirect (cafes, bakeries) competitors. Discuss their strengths and weaknesses and how you plan to differentiate your business.

4. Marketing and Sales Strategy

Your marketing and sales strategy outlines how you will attract and retain customers.

• Branding: Define your coffee shop’s brand, including logo, color scheme, and brand messaging. Your brand should reflect your coffee shop’s identity and appeal to your target market.
• Pricing Strategy: Determine your pricing strategy based on costs, competition, and customer willingness to pay. Consider whether you will position yourself as a premium brand or offer more budget-friendly options.
• Promotion and Advertising: Outline your promotional strategies, including social media marketing, email campaigns, loyalty programs, and community events. Discuss any partnerships with local businesses or influencers.
• Sales Strategy: Describe how you will sell your products, including your point-of-sale system, payment methods, and upselling techniques.

5. Operations Plan

The operations plan details the day-to-day operations of your coffee shop.

• Location and Facilities: Describe the layout and design of your coffee shop, including seating capacity, kitchen equipment, and decor. Consider the customer flow and how it will enhance the customer experience.
• Suppliers: List your suppliers for coffee beans, tea, pastries, and other ingredients. Establish relationships with reliable suppliers to ensure consistent quality and supply.
• Technology: Discuss any technology you will use, such as a POS system , inventory management software , or an online ordering platform.
• Staffing: Outline your staffing needs, including baristas, kitchen staff, and management. Discuss your hiring process, training programs, and employee benefits.
• Operating Hours: Determine your coffee shop’s operating hours based on customer demand and competitor analysis.

6. Management and Organization

This section provides information about the management team and organizational structure.

• Management Team: Introduce the key members of your management team, including their roles, experience, and qualifications. If you’re the sole owner, describe your background and expertise in the coffee industry.
• Organizational Structure: Create an organizational chart showing the hierarchy of roles and responsibilities within your coffee shop. Include positions such as manager, barista, kitchen staff, and support roles.
• Advisors: Mention any advisors or consultants you plan to work with, such as a business coach, accountant, or legal advisor.

7. Financial Plan

The financial plan is one of the most critical sections of your business plan, as it outlines your coffee shop’s financial projections and funding needs.

• Startup Costs: List all the initial costs associated with opening your coffee shop. This includes rent, equipment, inventory, licenses, and marketing expenses. Be as detailed as possible to avoid any surprises.
• Funding Requirements: If you’re seeking funding, specify how much capital you need and how you plan to use it. Include information on any loans, grants, or investor contributions.
• Revenue Projections: Estimate your coffee shop’s expected revenue for the first three to five years. Break down revenue by product category (e.g., coffee, pastries) and by month or quarter.
• Cost Projections: Detail your projected expenses, including fixed costs (rent, salaries) and variable costs (ingredients, utilities). Calculate your break-even point to understand when your business will become profitable.
• Profit and Loss Statement: Create a projected profit and loss statement (also known as an income statement) that shows your expected income, expenses, and net profit over time.
• Cash Flow Statement: Outline your cash flow projections to ensure you have enough cash on hand to cover expenses. This is especially important in the early stages when cash flow can be tight.
• Balance Sheet: Provide a projected balance sheet that lists your assets, liabilities, and equity. This will give potential investors or lenders a clear picture of your financial position.

8. Appendix

The appendix includes any additional information that supports your business plan.

• Resumes: Include resumes of key management team members.
• Market Research Data: Attach any relevant market research data, surveys, or studies that support your market analysis.
• Supplier Contracts: Provide copies of contracts or agreements with suppliers.
• Legal Documents: Include any necessary legal documents, such as business licenses, permits, or lease agreements.
• Product Photos: If you have photos of your coffee shop’s interior, menu items, or branding materials, include them here to give readers a visual sense of your business.

9. Tips for a Successful Coffee Shop Business Plan

Creating a successful business plan for your coffee shop requires attention to detail and a deep understanding of the industry. Here are some additional tips to help you along the way:

• Research Thoroughly: Conduct in-depth research on the coffee shop industry, your target market, and competitors. The more information you have, the better equipped you’ll be to make informed decisions.
• Be Realistic: While it’s important to be optimistic about your coffee shop’s potential, it’s also crucial to be realistic. Avoid overestimating revenue or underestimating costs. Conservative estimates will help you prepare for any challenges that may arise.
• Seek Feedback: Don’t hesitate to seek feedback on your business plan from trusted advisors, mentors, or industry experts. They can provide valuable insights and help you identify any weaknesses in your plan.
• Keep It Updated: Your business plan is a living document that should evolve as your coffee shop grows. Regularly review and update it to reflect changes in the market, your business goals, or financial situation.
• Focus on the Customer Experience: In the coffee shop industry, customer experience is paramount. Your business plan should emphasize how you will create a welcoming and enjoyable environment for your customers, from the quality of your coffee to the ambiance of your shop.

Starting a coffee shop is an exciting and rewarding venture, but it requires careful planning and execution. A well-crafted business plan is essential to guide you through the process and ensure your coffee shop’s success. By following the steps outlined in this guide, you’ll be well on your way to creating a thriving coffee shop that delights customers and stands out in a competitive market.

Related Posts

How to Open a Cafe With a Low Budget

How to Start Your Own Coffee Shop in South Africa

Coffee Shop Owner Salary and Job Description

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How to start a small business

This guide will help you get your business up and running..

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If you're launching your own business, you have a ton of questions that need to be answered: How do you name your business? How do you register it? Will people think your product is good enough to purchase? And how will you afford to get it off the ground when you still have bills to pay? 

With the help of experts and entrepreneurs, we've created this guide to help you figure out the solutions to the above questions and more. Read on and find out what you need to do to successfully launch your small business.

Already have your business plan ready and just need help legally forming it? These companies can help .

Research your market

Formulate a business plan, the different types of business models, fund your business, pick a business name, create a website for your business, legally form your business, apply for a business license (if you need one), apply for an employer identification number (ein), consider business insurance, open a business bank account, launch your business.

It's great that you have a dream and ambition, but you need to make sure there's a market for whatever product you want to create.

"It's important to do that market research prior to spending any kind of money so you can make sure you have something," says Abby Mercado, a former venture capitalist and founder of Rescripted , a women's health media company.

When done right, market research can reveal your ideal customer's specific needs, as well as the solutions they've tried before, your competitors, the price your customers are willing to pay, and more.

How to use social media and real-life feedback for your market research

Social media can give you an idea of what your potential customers are talking about online. If you're planning to launch a dog food company, for example, searching Reddit or going through the comments on competitors' TikTok and Instagram accounts can yield valuable information about what your customer wants. This approach is often referred to as "social media listening."

But it's also important that you don't limit your research to just searching around online and social media. For example, when Mercado was doing market research for what would eventually become Rescripted, a media company focused on women's reproductive health, she reached out to a fertility clinic she was familiar with and got feedback from a doctor there. According to Mercado, the doctor loved her idea and introduced her to potential customers who gave her even more feedback.

Questions to ask for good feedback

Here are some thought starters around the types of questions that would be useful to ask your target customer: 

• Which brands (in your targeted market) have you purchased from in the last 3 months?
• How satisfied are you with the products/solutions that already exist for this market? 
• What was your reasoning for purchasing from a competitor? 
• Which features are most useful to you? 
• How do you prefer to shop for this product/service? 
• At what price would you be unwilling to purchase this product? 

You can also get more useful feedback if you're able to give people an example of your product. For instance, if you want to open up a bakery, maybe whip up a small batch of cookies and hand them out in your neighborhood in exchange for people answering some questions.

Friends and family can sometimes be a good place to start looking for feedback about your offerings, but make sure you're surveying your ideal customer. This is the person who will most likely compare your business to competitors before deciding to buy. So if you're opening a butcher shop but your mom's a vegan, consider getting feedback from someone else. 

A business plan is a document that includes your business's goals and the framework you'll follow to achieve them. It can be a helpful document regardless of your business's size and whether this is your first business or your tenth. 

One of the most useful functions of a business plan is that it keeps you and your team organized and on the same page. If you're launching your business with a partner or are hiring a senior leader, having a written document everyone agrees on can help smooth over arguments about strategy.

A business plan also provides a roadmap for how you need to market your business and earn revenue during different stages of its growth. By identifying certain milestones in your plan, you can get a general sense of whether your business is on track or if you need to make adjustments. 

Finally, when you're applying for a business loan, grant or other types of funding, people may want to see your business plan before they give you money. 

The Small Business Administration (SBA) suggests your business plan include the following:

• An executive summary that provides basic information about your company and team, including what your product is and your company's mission. 
• A company description with more specific details about the market you serve and the advantages you believe you have that will give you an edge over the competition. 
• Trends or themes you're seeing in your target market.
• The legal structure of your business and who will be on your team (also mention if you're flying solo).
• An in-depth description of your product or service (including any patent filings and copyrights) as well as your marketing plan. 
• A declaration that you're seeking funding (if applicable). It can also be a good idea to include your financial projections with your funding request if you're approaching investors for your business. 

The business model is the part of your business plan that breaks down how you'll make money.

There are many business models and plenty of examples of companies that have obtained success with each one. Picking the right one depends on the nature of your business (among other things), since what works for a tech start-up might not fly for a food truck.  

Service (Fee-for-service)

As the name may suggest, a service-based business model involves carrying out a task or service in exchange for a fee. The fee may be paid as a fixed sum or an hourly rate. Common small business examples using a fee-for-service model include consulting, coaching or freelance work. 

Subscription

A subscription business model involves charging a fixed fee on a recurring basis in exchange for a product or service. This is a common model among online service providers, but it can also be used to sell physical products, such as subscription boxes.

This business model involves introducing customers to a free, basic version of the service in the hopes that they'll upgrade to a paid premium version with more features. Because this business model makes it possible for some customers to simply stick with the free version, it isn't ideal for product-based businesses. One example of a freemium business model is an app with free basic features and premium features that are unlocked when you pay to upgrade your plan.  

This type of business model involves selling a physical item in exchange for money. Products can either be sold in-person (think: bakery, ice cream shop, stationery store, etc.) or online as an e-commerce brand. It can be costly to produce a product so the goal is to make the item for a low cost and sell it at a higher price. 

You're going to need some type of funding to get your business up and running. Those costs can range from the equivalent of a night out to the price of a midsize sedan (and more) depending on your business, but you have plenty of options to secure your seed money. 

These are the most common ways to finance your small business idea.

Bootstrapping 

Best for: Businesses with low startup costs; founders with enough personal savings

Bootstrapping is perhaps the simplest way to fund your business because it involves spending your own money to get started. You don't have to apply for funding or worry about paying back a lender. 

Bootstrapping works best when you have low start-up costs (or if you have a high amount of personal wealth). The biggest risk with bootstrapping is sinking too much money in the business and then coming up short in your personal life when you need cash for an emergency or to cover the essentials.

If you aren't in a place where you feel comfortable assuming the risk of bootstrapping, there are other options to consider. 

Crowdfunding 

Best for: Raising small amounts

Crowdfunding involves asking multiple people to provide small amounts of money to help you reach a larger funding goal for a business idea. So if you need $5,000, you might have 200 people giving you small amounts of money to help you reach that goal. 

With crowdfunding, you typically don't have to pay back the people who gave you money (though some crowdfunding platforms make you give the cash back if you don't reach your funding goal within a certain amount of time). 

When Dr. Jenny Woo was working to launch Mind Brain Emotion , a deck of skill-building cards, she used a combination of bootstrapping with a small amount of money and crowdfunding through Kickstarter. 

"For me personally, Kickstarter was the lowest risk," she explains. "The worst risk is you don't get funded. It's also less time-consuming than if you were to pitch [to investors] or try to get a loan."

Crowdfunding can be a good way to close small funding gaps that you can't afford to fill with your personal savings. However, keep in mind that many campaigns may only last 30 to 60 days on the platform so you have to be realistic about how much money you can raise in that time. 

Some crowdfunding platforms charge a platform fee. The fee is charged as a percentage of the total funds you raise and it can range from 5% to 12%. This obviously eats into the money you can walk away with.

Best for: Businesses that don't need urgent funding; businesses that can meet any usage rules

A grant is a lump sum of money awarded to a business or organization that doesn't need to be paid back. Business grants are commonly provided by government organizations, nonprofits and corporations. 

You'll need to fill out an application to be considered. Some grant application processes may have lengthy approval and disbursement timelines so even if you qualify it may take some time to receive the funds. This is why grants may not be for everyone. If you need money more urgently to fund product development, you may need to look at other options.

While it can take a while to be awarded grant money, it can be well worth it if you don't need to dip into your savings or take on debt for your business. 

Also keep in mind that some grants have strict rules on how you can use the funding. For instance, some grants may only be used to fund research and development while others can only be used for purchasing equipment. 

Small business loans 

Best for: Founders who need a large lump sum of money upfront and can afford to make small, incremental repayments

Unlike a grant, a small business loan is money that's provided by a lender that must be paid back within a certain amount of time. The terms of your small business loan can depend on your credit score, the type of business you're running and how much money you need. 

You'll also need to pay interest in addition to the principal amount. So before you decide to take on a small business loan, make sure you can afford to pay it back without defaulting on your balance. 

CNBC Select ranks OnDeck as one of the best small business loan lenders for its same-day funding service, and Kiva for its 0% interest crowdfunded microloans.

Types of loans

Better business bureau (bbb) rating, loan amounts.

$5,000 to $250,000

Up to 24 months

Minimum credit score needed

Minimum requirements.

In business at least 1 year, $100,000 annual revenue, business bank account

Terms apply.

• Potential for same-day cash disbursement (only available in certain states, for term loans up to $100,000)
• Top-tier A+ rating with the BBB
• Low minimum credit score
• Fixed monthly payments
• 100% Prepayment Benefit option, so you can pay your loan off early without any penalty or fee
• Doesn't lend to businesses in Nevada, North Dakota or South Dakota
• Early prepayment fee if you don't qualify for the 100% Prepayment Benefit

Peer-to-peer crowdfunded loan

$1,000 to $15,000

Up to 3 years

No minimum credit score required

You must be 18, live in the U.S., use this loan for business purposes, not currently in foreclosure, bankruptcy or have any liens, and have a small number of your friends and family willing to make a loan to you (Nevada and North Dakota residents are not ineligible)

• Ability to borrow with no interest
• Loans are geared toward borrowers who are unbanked and have trouble qualifying for financial products
• Ability to market your product to 1.6 million lenders on Kiva
• You need to prove your creditworthiness by inviting friends and family to lend to you
• It can take a while to receive your loan since investors need to raise money
• No BBB rating

Small business credit card 

Best for: Founders who want access to a line of credit for small expenses over time

A small business credit card also involves taking on debt to finance your business costs. Unlike a loan, a business credit card is a form of revolving credit that you can use repeatedly (so long as you make good on your payments). This can make it more flexible than a loan, where you need to apply for a lump sum upfront, requiring you to know exactly how much money you'll need from the very beginning. 

The Blue Business® Plus Credit Card from American Express is a strong option for business credit because it offers a 0% intro APR period of 12 months on purchases from the date of account opening (18.49% - 26.49% variable APR after that; APR will not exceed 29.99%). ( See rates and fees ).

The Blue Business® Plus Credit Card from American Express

Earn 2X Membership Rewards® points on everyday business purchases up to $50,000 per year, then 1X point per dollar

Welcome bonus

Earn 15,000 Membership Rewards® points after you spend $3,000 in eligible purchases on the Card within your first 3 months of Card Membership.

0% for 12 months on purchases from date of account opening

Regular APR

18.49% - 26.49% variable; APRs will not exceed 29.99%

Balance transfer fee

Foreign transaction fee, credit needed.

See rates and fees , terms apply.

• No annual fee
• Straightforward rewards program
• 2.7% foreign transaction fee

The Ink Business Unlimited® Credit Card is also a solid contender since it doesn't charge an annual fee and you'll earn 1.5% cash back on purchases for your business.

Ink Business Unlimited® Credit Card

Earn 1.5% cash back on every purchase made for your business

Earn $750 bonus cash back after you spend $6,000 on purchases in the first 3 months from account opening

0% for the first 12 months from account opening on purchases; N/A for balance transfers

18.49% - 24.49% variable

Either $5 or 5% of the amount of each transfer, whichever is greater

Good/Excellent

• Free employee cards
• Simple cash-back program
• Special financing offer for purchases
• 3% fee charged on purchases made outside the U.S.

Which funding method is right for you?

When deciding which funding route to take, you probably want to spend as little of your own money as possible. In this case, you might first consider crowdfunding and applying for grants since you don't need to pay back this money. In the best-case scenario, you'll raise all the money you need for start-up costs without spending a dime of your savings. 

But it's more likely that crowdfunding or grants will cover some of your expenses, but not everything. If you need to save some money to bridge that funding gap, consider a high-yield savings account . An FDIC-insured account is one of the safest places to put your cash, and your funds will earn interest while remaining easily accessible. The Marcus by Goldman Sachs High Yield Online Savings account, for example, doesn't charge any monthly fees, overdraft fees, or excessive transaction fees. LendingClub High-Yield Savings also has no monthly fees, and doesn't require a minimum balance to earn its high APY.

Marcus by Goldman Sachs High Yield Online Savings

Annual percentage yield (apy), minimum balance, monthly fee, maximum transactions.

At this time, there is no limit to the number of withdrawals or transfers you can make from your online savings account

Excessive transactions fee

Overdraft fee, offer checking account, offer atm card.

• No minimum balance or deposit
• No monthly fees
• No limit on withdrawals or transfers
• Easy-to-use mobile banking app
• Offers no-fee personal loans
• Higher APYs offered elsewhere
• No option to add a checking account
• No ATM access

LendingClub High-Yield Savings

No minimum balance requirement after $100.00 to open the account

Overdraft fees

Taking on debt to start your business should be a last resort and only used after careful consideration. You must be confident that you can pay back in full any money you borrow for your business. 

Your business's name communicates to the world who you are and what you can do — so it's important to pick a name that lets you put your best foot forward. 

But there are also some legal considerations to make when picking the right business name. For instance, you must avoid selecting a name that sounds too similar to your competitors' names. You can use the Trademark Search tool from the United States Patent and Trademark Office to see if your desired business name has already been trademarked by another business. 

Additionally, you may also need to double-check any laws around naming a business for your state. Some states may require you to add certain "identifiers" to the end of your business name if you're a registered legal entity. Identifiers could include words like "Inc," or "Corp." 

If you're confused about where to start, services like LegalZoom can help you get started in the right direction. LegalZoom lets you set up your business legally and will check that your desired business name is available for you to use.

From $35 to $279+

App available?

Standout features.

LegalZoom offers all sorts of legal document templates online so users can avoid having to hire an outside lawyer. Its downloadable wills, living wills and financial power of attorney documents make it easy to estate plan. LegalZoom also has its own network of attorneys that customers can utilize to ask questions, etc.

Your business needs a website to let potential customers know where to find you online and how to contact you. Your website's complexity will often depend on the type of business you're running. If you have a coaching or consulting business, a simple website where you can talk about who you are and what services you offer works perfectly.

Creating a simple website on your own is relatively straightforward, especially when you use a service like Squarespace or Wix that lets you use premade templates without having to learn to code.  

Squarespace

Plans start at $16/month when you pay annually

Free trial available?

14-day free trial

Squarespace offers several features for building yourself a website, including a wide variety of templates to choose from, support from a Squarespace web designer, marketing tools, a logo maker and more. Its offerings cater to several industries and website uses including blogs, portfolios, fitness, beauty, restaurants, artists, photographers and weddings to name a few.

Plans start at $17/month

No free trial but Wix offers a 14-day money back guarantee

Squarespace offers over 900 website templates, and a website building tool that leverages AI to design a site based on your desired customizations.

However, if you're selling goods and your website is your online storefront, you'll need more functions such as accepting (and processing) customer payments, collecting contact information, displaying your goods in an easy-to-navigate user interface and more. You can still use services to build a more complicated e-commerce website on your own, but it may be worth hiring an expert depending on your skill, time and patience.

Here are some signs that you may want to hire a website designer instead of creating the website yourself:

• You need advanced features to help you sell products online. 
• You need a long-term relationship with a designer to help your site evolve as your business grows.
• You're too busy to do it yourself and are comfortable spending the money to have someone else do it.

One key decision to make that will have far-reaching consequences with taxes and more is your business's legal structure. The three most common legal structures that pertain to small businesses are a sole proprietorship, a limited liability company (LLC) and an S Corporation (S-Corp for short). 

Each structure outlines its own set of distinctions and protections for operating your business. 

Sole proprietorship

A sole proprietorship is probably the simplest structure to understand and use. A sole proprietorship is owned by one individual (the sole proprietor). You don't need to file any paperwork to "incorporate" your business as a sole proprietorship. If you begin operating a business and don't file as any business structure, you'll be automatically considered a sole proprietorship, according to the Small Business Administration (SBA) . 

However, because a sole proprietorship doesn't create a separate entity for your business, you are liable for your business's debts.

"I rarely recommend a sole proprietorship because it's the default structure and you aren't taking advantage of the legal rights you can have with other business structures," says Shaliz Sadig Romano, the Co-Managing Partner at Romano Law , a law firm that represents entrepreneurs. "If something goes wrong, we want to make sure the assets of the company are what's on the line, not your house, car or other personal assets." 

Limited liability corporation (LLC)

Next down the line is an LLC. As the name suggests, an LLC limits the liability you may take on from your business activities. With this type of legal structure, your business becomes an entity that's separate from you and will have its own bank account and taxpayer ID. 

This creates a huge advantage for you as the business owner since you'll be able to protect your personal assets from liabilities, debt, lawsuits or bankruptcies incurred by your business. 

According to Romano, filing for an LLC also sets your business up for growth – investors may feel more comfortable getting involved with an LLC, for example, and you also can hire employees under this structure.  

"As the saying goes, an LLC is a lawyer's likely choice because it's great for small businesses and even some bigger ones that want to keep growing," Romano says. 

S Corporation

An S Corp is another legal structure that provides limited liability protection to the business owner, much like an LLC. Both LLC's and S Corps are considered "pass-through" entities because the business itself doesn't pay taxes but rather the tax liability "passes through" to the owner's personal taxes. Both structures allow owners to protect the owner's personal assets. 

One key difference between the two is that an LLC can have an unlimited number of owners (called members or shareholders) while an S Corp can have no more than 100 shareholders.

Which one is right for you?

Begin by thinking about where you see your business heading. This can provide some clues about which structure may be right for you. "What I tell clients before diving in is that it's important to have a vision of where you want to start and what you want to see in the next two to five years," Romano explains. "Are you looking to be a really small solopreneur like a consultant and don't intend on hiring or having office space? Or are you looking for something much bigger?"  

For instance, if you're planning to run an online e-commerce business on a platform like Etsy all by yourself on the weekends, you may feel secure enough to run it as a sole proprietorship. But if you want to open up a storefront and can see yourself seeking assistance from investors one day, an LLC or S Corp may be a better fit for you. 

Another consideration is the scope of your business practices. According to Romano, while an LLC is fine for doing business in the U.S., not all countries recognize an LLC as a legal entity or have different rules around it. So if you plan on doing business overseas, you'll want to read up carefully on that country's practices around legal structures so you can choose the one that's right for you. 

The other thing to consider are requirements for filing an S Corp . To file an S Corp, you must be a U.S. citizen or legal resident and your business must operate domestically. You also can't have more than 100 shareholders — a person or organization that owns stock in the company — and those shareholders must have voting rights. 

This is not the case for filing an LLC. You don't need to be a U.S. citizen or legal resident to file an LLC. 

Understanding the requirements and do's and don'ts of each of the legal structures can give you a sense of which one best suits your needs. LegalZoom also offers tools to help you figure out which type of legal structure is best for your business.

These companies help you legally form your business

LegalZoom is a well-known service in this space. According to its website, LegalZoom helps users through three steps for getting their business started: Choosing a name and business structure, compliance information and paperwork filing for the business structure. Once you're off the ground, you can also use other LegalZoom features — like getting the right business licenses and getting operating agreements — to manage your business. Pricing can depend on the type of business you're forming, the formation state and any other business management features you might need.

For a more bare-bones service, Tailor Brands is a standout option. At the most basic tier, you can file an LLC application in your state and get it processed within 14 days. For this, you'll only pay your state's filing fee. Other tiers are more costly but offer services beyond just LLC application filing.

The highest pricing tier for Tailor Brands — the Elite package — comes with LLC formation, expedited LLC filing (processed within two days), legal compliance, a domain name and website plus a $50 Amazon gift card all for $249 per year plus your state's fee. You'll also get access to a host of additional business tools with this tier, like digital business cards, eight free logos and more.

Tailor Brands

From $0 to $249/year + state fee

Tailor Brands offers a basic LLC filing service for new business owners that costs $0 (you'll just pay your state's filing fee). It also offers a more comprehensive suite of business management services for a yearly subscription fee, including a website, domain, compliance services, business cards, logos and more.

Another service, Bizee , offers a ton of bang for your buck even at the most basic pricing tier ($0 + your state's filing fee). At this pricing level, you can take advantage of

• unlimited business name searches
• paperwork filing
• access to a Registered Agent (to assist with state compliance for a year)
• compliance alerts
• banking offers
• business tax consulting
• unlimited phone and email support.

There are also several add-ons for an additional charge that you can pick and choose from.

From $0 to $299/year + state fee

Bizee offers a slew of features even at the most basic pricing tier. You'll be able to submit your business filing, receive compliance alerts and take advantage of business tax consultations, business banking offers and unlimited phone and email support. There are also several add ons you can pay extra for at any tier.

A business license is an official permit distributed by a state or local government allowing an organization to conduct business. Not all businesses may require a license but there are certain industries where you must have a license to operate.

For instance, if you're opening a business as an esthetician and offering hair and nail services to clients, you'll likely need an esthetics license to perform those services. If you're opening a bakery, you'll also need a license to prepare and sell food. And if you're starting a construction business, you'll want to get licensed as a contractor. 

As you might imagine, there are many consequences for operating a business without a license — especially if your services result in harm.

Always be sure to check with your state or jurisdiction's business license requirements before you begin operating. 

An employer identification number (EIN) allows the IRS to identify your business and track its tax activities. 

While an EIN may not be necessary for every type of business, certain entities are required to have one, including corporations, partnerships and organizations with employees. 

Business owners can visit the IRS website for additional information on who needs an EIN.

It's free to get an EIN. You'll just need to submit IRS Form SS-4 . If you choose to apply and submit your information online, your EIN will be issued immediately, according to the IRS website . If you apply by mail, it'll take approximately four weeks to process your application. 

There's also the option to apply by fax, which will allow you to receive an EIN within four business days. 

Business insurance can protect your business and its physical property, but it can also provide coverage in the event of a lawsuit, harm, theft and more. 

For instance, if a natural disaster wrecks your bakery's storefront or the vehicles you use to make deliveries get broken into, you can file an insurance claim to cover your losses.

Insurance can also help pay for some expenses if your business is facing a lawsuit. Or, if an employee becomes sick or injured while doing their job, an insurance policy that includes worker's compensation will allow your business to provide the medical care they need. 

The type of insurance and the amount of coverage you need will depend on the business you're running and how much risk is involved with that business. 

CNBC Select ranked The Hartford Business Insurance as one of the best providers for small business insurance since this company services many industries at relatively affordable prices. Nationwide also excels at offering a wide variety of plans to business owners.

The Hartford Business Insurance

The best way to estimate your costs is to request a quote

Policy highlights

The Hartford has been offering insurance policies for over 200 years and insures over 1 million small businesses. It offers coverage for a variety of industries and is highly rated for customer satisfaction.

App available

• Quotes available online
• Highly rated for customer satisfaction
• App doesn't support business policy management

Nationwide Business Insurance

Nationwide offers insurance policies for small and large businesses alike in a variety of industries. A number of insurance types also help business owners to tailor their coverage.

Keeping your business finances separate from your personal finances is ideal since it allows you to stay organized and keep better track of your transactions come tax time. Plus, some lenders and grant funders require that you have a business bank account so that you can receive your funds. 

It's fairly simple to open a business bank account, and the process is very similar to opening a personal bank account. 

CNBC Select ranked the Bluevine Business Checking Account as one of the best accounts for small businesses since it doesn't charge a monthly maintenance fee, has no minimum deposit required to open the account and no minimum balance requirements. On top of that, account holders earn interest on their balances and get access to a convenient mobile app.

Bluevine Business Checking

Special offer, monthly maintenance fee.

Standard $0; Bluevine Plus $30/month (with options to waive) ; Premier $95/month (with options to waive)

Minimum deposit to open

Standard: 2.0% APY on balances up to and including $250,000 if you meet a monthly activity goal* Bluevine Plus: 3.0% APY for Plus customers Premier: 4.25% APY without minimum qualifications

Free ATM network

No fees at over 38,000 ATM locations nationwide

ATM fee reimbursement

Small business perks.

Two free checkbooks

Mobile check deposit

Terms apply. Bluevine accounts are FDIC insured up to $3 million per depositor through Coastal Community Bank, Member FDIC

• No monthly fees, monthly or daily balance minimums, ACH payment fees, incoming wire fees or overdraft fees
• Ability to instantly lock and unlock your Bluevine Business Debit Mastercard® for added security
• Connect to business tools like PayPal, Stripe and Expensify
• Unlimited transactions
• Online only (not great if you prefer in-person banking)
• No ATM refunds for out-of-network transactions

*The requirements to earn interest are either:

• Debit Card Spend: Spend $500 per month with Bluevine Business Debit Mastercard® issued by Coastal Community Bank pursuant to a license from Mastercard inc, which can be used everywhere Mastercard® is accepted.
• Incoming Payments: Receive $2,500 per month in customer payments into Bluevine Business Checking account via ACH, wire transfer, mobile check deposit, or directly from merchant payment processing provider

As for savings accounts, one of the strongest options on the market is the Axos Bank Business Premium Savings account. It doesn't charge a monthly maintenance fee, doesn't have a minimum deposit required to open the account and there are no overdraft fees. It offers a very attractive APY for account balances and you can deposit checks into the account through the mobile app.

Axos Bank Business Premium Savings

Minimum deposit.

Up to 6 free withdrawals or transfers per statement cycle

Yes, if the account holder has an Axos business checking account

• Above-average APY
• Deposit checks remotely using your mobile device
• No physical branches for in-person banking

Set up your accounting system

As a business owner, you'll need to prepare for tax events and manage your cash flow to help you reach your business goals year-round. Working with a professional can help you understand the numbers underpinning your business and clarify what decisions you need to make for long-term success.

"Staying organized is key," says Sheneya Wilson, Founder and CEO of Fola Financial. "Work with a professional who's not just interested in giving you services at the end of the year but rather someone who can work with you throughout the year so you can be prepared."

Of course, good professionals can cost a lot of money. If you want to take a more DIY approach to your business's accounting, consider paying a small monthly fee for software like Quickbooks or Xero . These types of programs can often help you track business expenses, pay bills, and accept payments. They can also integrate with payroll services to make paying your employees simple.

Quickbooks® Payroll

Starts at $22.50/month + $6/month per employee (with discount; regular price starts at $75/month + $6/month per employee)

Benefits Administration

401(k) plans, health benefits, workers' compensation administration

Starts at $3.75 per month for three months (with discount; regular pricing starts at $15 per month)

Yes, through a partnership with Gusto

Yes, in partnership with Gusto; When you sign up for Xero you get 30 days of Gusto for free and after that, you must pay Gusto's standard charges

Once you've checked off all the other items on your to-do list, the last thing left is to actually launch your business and begin operating. 

Before you launch, it can be helpful to set up social media profiles for yourself so you can spread the word before your business is even running. You may be able to get your early clients and customers through friends and family. 

This is also where you can refer back to your business plan for steps on how you'll market the business and increase sales. 

Keep in mind that running a business means you're constantly learning and adapting. There will always be ups and downs but being able to pivot quickly and learn from what's working (and what's not working) can help you recover quickly and build a sustainable business.

Money matters — so make the most of it. Get expert tips, strategies, news and everything else you need to maximize your money, right to your inbox.  Sign up here .

Meet our experts 

At CNBC Select, we work with experts who have specialized knowledge and authority based on relevant training and/or experience. For this story, we interviewed: 

• Sheneya Wilson, the Founder and CEO of Fola Financial
• Shaliz Sadig Romano, the Co-Managing Partner at Romano Law 
• Dr. Jenny Woo, the Founder and CEO of Mind Brain Emotion 
• Abby Mercado, the Co-Founder and CEO of Rescripted and a former Venture Capital Investor at the Altira Group

Why trust CNBC Select? 

At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every article is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of small business products. To research the best insurance companies, we compiled over 100 data points on more than a dozen insurance companies. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics. See  our methodology  for more information on how we choose the best commercial auto insurance companies. 

Catch up on CNBC Select's in-depth coverage of  credit cards ,  banking  and  money , and follow us on  TikTok ,  Facebook ,  Instagram  and  Twitter  to stay up to date.

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How To Start an Online Store in 2024 (Step-by-Step Guide)

This step-by-step guide walks you through how to set up an ecommerce website and build a profitable online store.

Starting an online store can be a daunting task, but with the right tools and guidance, it can be a rewarding and profitable venture, too. Whether you’re a seasoned entrepreneur or just starting out, creating an online store can help you reach a wider audience and grow your business.

In this article, we’ll lead you through how to start an online store, from choosing an ecommerce platform to designing your website to launching your first product. With the help of this comprehensive guide, you’ll be well on your way to building a successful online store.

How to start an online store

• Decide on a target audience
• Find a business idea and choose your products
• Choose an ecommerce platform
• Design your brand
• Determine your business structure
• Set up your ecommerce website
• Connect a payment gateway
• Get your store ready for launch
• Launch your online store
• Market your online store

1. Decide on a target audience

A target audience is the group of people your marketing efforts are focused on. When starting an ecommerce store, knowing your ideal audience is critical. It helps you find new customers easier and attract interested buyers to your website, resulting in higher conversion rates and more sales. 

You can make an audience of any size or attribute, depending on what products you plan to sell. However, there are three main categories to look at as a new ecommerce entrepreneur:

• Demographics . Includes characteristics such as age, gender, occupation, education, and income. 
• Location . Groups that divide the market based on geographic location, so you can serve a specific area better. 
• Interests . Built around psychographics and includes attitudes, personality, opinions, and the lifestyle of your audience. 

Ask yourself: Who buys my product? What are they like? What’s their age? Compile that information into a buyer persona and include it in your business plan . You’ll want it when you create your website copy and marketing campaigns. If you don’t have a product, you can still narrow in on a target market and build a product around it.

📗 Read more:  How To Reach Your Target Audience: 8 Strategies

2. Find a business idea and choose your products 

One of the biggest challenges entrepreneurs face is finding profitable products to sell. Coming up with product ideas is a bit tricky, but if you have an audience in mind, you’re one step ahead. Fortunately, there are plenty of opportunities to find products to sell, whether you’re manufacturing, reselling, or dropshipping .

You can find profitable products to sell online in a number of ways:

• Appeal to enthusiastic hobbyists
• Go with your personal passion
• Capitalize on trends early
• Look at what’s trending in online marketplaces

✏️ Note: While this article is dedicated to helping you start an online store, you can refer to our comprehensive guide to starting a business to learn more about topics like branding, writing a business plan , choosing a product, and finding a manufacturer.

📚 Resources: 

• Product Sourcing Guide to Sell Online
• Product Ideas: 16 Places to Find Profitable Products
• 20 Trending Products to Sell Online

3. Choose an ecommerce platform 

When you’re learning how to start an online store, one of the biggest decisions is which platform you will use. An ecommerce platform lets you build and start an online store experience, make sales, and fulfill orders. 

When considering how to make a website to sell online, think about your ecommerce platform as the control center for your entire business, controlling everything from inventory to marketing, giving you all the tools you need to sell online and provide customer support.

Key features to look for in an ecommerce platform include:

• Usability . Your ecommerce software should be easy to use. Look for a tool that is intuitive and uses a drag-and-drop online store builder to easily create your online store.
• Accessible customer support . Look for a platform that offers support the entire way. 
• Friction-free checkout . Streamlined checkout is critical to making sales. Find an ecommerce platform that makes it easy for shoppers to buy your products.
• Web hosting . You need web hosting to let people access your online store. Some ecommerce software offers web hosting built-in, while others require you to use a third-party solution.

When choosing your ecommerce software, consider your current and future needs. Some platforms may be the best solution for today, but a powerful platform like Shopify can get you started quickly and support your future growth. 

4. Design your brand 

Before you begin designing your ecommerce website, you’ll need to consider branding . Create a brand identity and develop brand assets to use throughout your online store and across other channels. Be sure you’ve developed the following elements to plug into your store design.

Before Verve designed its online store, it made deliberate choices around fonts, colors, logo design, tone of voice, and other aesthetic elements to ensure consistency in branding across its properties:

Brand values and mission

Before designing brand assets like a logo or color palette, decide what your brand stands for, your purpose, your unique selling proposition , and your brand promise to customers. These decisions will help shape the visual look and feel of your brand.

Create a professional logo in seconds

Shopify's free tool is built for entrepreneurs on the go. No design experience is required to create your own logo from scratch.

Business name

Choose a business name that represents your brand, whether it’s your own name, a made up word, or a literal description of what you sell. If you’re stumped, try Shopify’s free domain name generator and run your ideas through a tool like Namechk to see if your business name ideas are available on social and as a domain. 

Whether you work with a designer or design your own logo , it is an asset that will represent your brand across a number of surfaces, from your online store to your packaging. Be clear about what you want your brand to represent, including your mission, values, and tone, as these will help a designer nail your look.

Lifestyle and product photos

Clean product photography helps you put your best foot forward. If you’re on a budget, you can shoot your own product photos with your smartphone camera and use free stock photos until you can shoot your own custom lifestyle photos .

📗 Read more:  How To Design a Visual Identity for Your Brand: Ideas for Every Budget and Skill Level

5. Determine your business structure

You’ve finished all the fun parts of starting an online store: choosing your name, building your site, finding products, writing product descriptions. But before you launch, you want to make your new business legal. 

While it’s not the most enjoyable job, incorporating your business is a must. A legal entity recognized by the government protects your personal assets if something goes wrong. It also helps you:

• Potentially receive a lower tax bill
• Secure business funding more easily
• Create retirement plans
• Separate credit rating from your personal score

Common business structures for new business owners include:

• Sole proprietorship . An unincorporated business without legal distinction between the company and the individual running it. It qualifies as a non-employer business and is the most straightforward to set up and manage. 
• Partnership . A single business with two or more owners. Each owner contributes to the business via funding, property, labor, or skill. Partners share responsibility and profits. 
• Limited liability corporation ( LLC ). A hybrid business structure that combines partnership with the liability protection found in corporations.

📗 Read more:  The 4 Most Popular Types of Businesses and How To Choose One

6. Set up your ecommerce website

Now you’re ready to start building your ecommerce site. Follow these steps to make sure you’ve completed every task on your ecommerce checklist before you launch. 

Add your products

In your ecommerce platform, head to the “Add a product” section. Here, you’ll add all the content, assets, and details about your product.

Writing product titles and descriptions

Your product title should make it clear what the product is. This is what customers will see as they browse your store and what will help them find what they’re looking for in your catalog. Try to keep it short and use your product description or variants to surface other specific information or product options, such as colors or sizes.

Product descriptions describe and sell your product. When writing them, keep the following in mind:

• Know who you’re speaking to. Think about what your customer needs to know to feel confident buying your product and try to communicate it in your description.
• Highlight incentives. Consider what features, benefits, and offers really matter—and cut the fluff. Many stores mix text and icons to quickly communicate these selling points on their product pages.
• Anticipate common questions or objections. What might make a customer hesitate to buy? Are they afraid of buying the wrong size? Do they need allergen information? 
• Make your text easy to scan. Make your descriptions easier to read with short paragraphs, bullet points, subheadings, bolded text, etc. Or use nested navigation to organize information into tabs.
• Help customers see themselves using your product. Customers can’t taste, feel, touch, or try on your products. List the materials you use, include a size chart, etc.

In this example, skin care brand Frank Body uses its product description to talk about the product’s benefits and ingredients, while also maintaining the brand’s tone of voice :

Uploading product photos or other media

On most ecommerce platforms, you can upload visual media that helps you share richer details about your products: photos, GIFs, videos , or even 3D models. 

Presentation makes all the difference. Help customers imagine owning your product. Help them see it in action or proudly displayed in their space. Here are a few points to remember:

• Use high-quality photos. Avoid blurry, poorly lit, or low-resolution images.
• Maintain the same aspect ratio. A consistent aspect ratio ensures that all your photos appear the same size. This creates a cleaner, more professional appearance when you create your online store.
• Use the tools you have. If you’re on a budget, many smartphones are capable of shooting high-quality product photos. Use free photo editing tools to touch them up.
• Add necessary details. Edit the alt text for accessibility (describe your photo visually so it can be accessible to screen readers).

On its product pages, ReFramed uses several clean product shots on plain backgrounds to show every detail without distraction:

Setting your price

Several variables can influence how you price your products , such as shipping costs, raw materials, overhead like rent or employees, the cost of your time, and, perhaps most important, the perceived quality of your products.

You can always revisit and adjust your prices based on what you learn after you start marketing. You may discover that customers are actually willing to pay more for your products, or you may find creative ways to cut costs and increase the average value of every order you get. 

While there are some exceptions, businesses that sell goods and services have to collect taxes each time someone orders from them, so be sure to configure your tax settings. 

📗 Read more:  Rule the Market: 14 Retail Pricing Strategies

Managing your inventory

Depending on your business model, you may need to track, store, and manage inventory. Some exceptions include dropshipping and print-on-demand online stores. When building your online store, you can use features or your ecommerce platform (and third-party apps) to help you. 

Some terms you may encounter in your online store admin: 

• SKU. A stock keeping unit (SKU) is used to track and manage your inventory for specific products and variants. Create a consistent system using numbers or letters that makes it easy for you to identify what the exact item is at a glance.
• Bar code. Bar codes (UPC, GTIN, etc.) are typically used if you’re reselling products or eventually want to add scannable bar codes to your items for easier inventory management . 
• Quantity. This is how much of a specific product you have on hand. If you have multiple locations holding inventory and have them set up in Shopify, they’ll display here.

📗 Read more:  What Is Inventory and Why Is It Important?

Setting shipping details

In the shipping section of your online store admin, you’ll enter details that will automatically calculate shipping rates and print the appropriate shipping labels for each order. Setting the actual shipping costs and options that you’ll offer to your customers will come later on in this tutorial.

Adding product options

If your product comes with different variants, like sizes or colors, instead of adding each one as its own product, you can simply add them as variants of the same product. Each option can have its own image, price, tracked inventory, and individual settings associated with it.

You can even drill down further on your options, for example, offering multiple colors that each come in different sizes. In this example from LNDR , a pair of its athletic pants has layered variants for size, length and color:

Organizing and tagging your products

Your ecommerce platform will offer other fields on the product page builder to help you better organize your catalog. On Shopify, some of the fields include: 

• Product availability. Set your product to “available” (you can toggle sales channels on and off later).
• Product type. This is a product category that you can use to identify certain products (e.g., t-shirt). 
• Vendor. This is the manufacturer, wholesaler, or third-party vendor for the product (if applicable). You can filter your product list by vendor, which can speed up ordering inventory. 
• Tags. Tags are keywords that you can associate with your product. You can add multiple tags to a product to help customers find it through your online store’s search bar. 
• Collections. Collections are important. They let you organize and curate your products for specific purposes and audiences.

Grouping your products into collections

Collections can be created to curate products to target a specific audience, a theme, or product category. Organizing products this way can help you feature products on your page by event or season, like highlighting candy before Halloween, or make changes to a group of products such as putting a whole collection on sale. 

Most importantly, collections help with navigation and often appear in the main menu or top navigation of an online store. This example from Cocofloss shows collections by popularity (Best sellers), type (Cocofloss), and audience (Kids):

Setting search engine listing details

You can improve the discoverability of your products through search engines like Google by using best SEO practices to write a page title, page description, and URL to represent your product page. 

If you know what keywords your target customer is using to search for products like yours, you can work them into these fields to increase your odds of ranking in search results.

For the example above, here’s how the search engine listing looks for two Cocofloss products:

📗 Read more:  Keyword Research for Ecommerce: A Beginner’s Guide

Create key pages for your online store

Aside from product pages, there are a few critical pages to set up for your online store. These pages help build trust, tell your brand story, answer common questions, and let customers know how to reach you. These include:

Contact page

Policy pages.

About pages are a great way to embrace the “small” in “small business” and earn trust as a new merchant while you create your online shop. You can have a video introducing yourself as a founder, links to awards and press mentions, images that explain your supply chain, or anything that helps this page tell your customers who you are and what you’re about.

Your Contact page is what customers will look for to ask a question or get support. A physical address, phone number, email address, contact form, and customer support hours are all helpful pieces of information to include. There are also live chat apps you can install to make support even more accessible to shoppers.

Policy pages are standard practice for online businesses. They give your customers a place to understand how you conduct your business and what to expect from you. They also help protect you in case of a customer dispute. These include:

• Return policy. What’s your policy regarding returns and exchanges ? A generous return policy can help customers buy from you with confidence.
• Privacy policy. A privacy policy describes how you collect information about your customers.
• Terms of service. Your terms of service policy is an agreement between you and your customers outlining how you will operate and what rights you reserve.
• Shipping policy. A shipping policy helps you set customer expectations around shipping costs, manufacturing times, and delivery speeds for the regions you ship to.

💡 Tip: Just like you did for product pages, customize the search engine listing details for your pages based on what you want the URL to be and how you want the page to appear in search engine results.

Create an online store that’s completely customized

Now that your ecommerce store has some products and content, you can customize its overall design (and see how those changes look on various pages).

Choosing an ecommerce theme

The first step is to choose a theme: an ecommerce template that you can use as a starting point for design as you build your own online store. Most ecommerce platforms have a suite of themes you can choose from. For example, the Shopify Theme Store is home to both free and paid themes, each with its own set of styles and features: 

Here are some key points to consider when choosing the perfect theme for building your own store:

• Filter themes based on your business size, catalog size, volume of orders, industry, and product type. Some themes are better suited to fashion stores, for example, while others are designed for high-volume businesses.
• Consider whether the theme you’re looking at has any built-in features you need, like a search bar that auto-completes queries or a section that displays press mentions. 
• Don’t pick a theme based on colors or fonts. These are all things you can customize later. 

📗 Read more:  How Do You Pick the Best Theme for Your Online Store? Take Our Quiz

Designing your homepage

When determining your homepage design , think about the goals a homepage needs to accomplish and determine how they apply to your specific business:

• Prioritize first-time visitors and help them quickly understand what your business is and what you sell.
• Accommodate returning visitors and make it easy for them to navigate to the products and pages they’re looking for.
• Try to build interest in your products and trust in your business with every scroll.
• Create clear paths for your visitors to take based on their intent to purchase. Avoid clutter.
• Design your homepage with the assumption that many of your visitors will be browsing it on their mobile devices. 

This uncluttered homepage by Allbirds prioritizes full-width lifestyle photos and a clear path to shop the brand’s two main collections: 

Customizing your navigation menus

There are three main forms of navigation you can set up for your online store: 

• Main navigation. This is the top menu where you can prioritize the main navigation paths you want to offer customers. 
• Footer navigation. This is where you keep links to non-essential pages that might distract new visitors but still need to be available for those who need to find them. 
• Search. You can enable the search bar in the header to help visitors directly navigate to what they’re looking for. 

You don’t want to overwhelm people with too many options from the get-go. Instead, you can organize your navigation to prioritize the actions you want visitors to take—with a focus on shopping, of course.

Setting brand colors, typography, and other design elements

Colors and typography play a big role in your brand’s visual identity and should be a top consideration when you build your brand and your own online store. 

Even if you’re not a designer, you can still build your own store and pick font and color pairings you feel good about using the following tips:

• Most themes allow you to customize colors and fonts. Use those from your brand guidelines or style guide.
• Consider psychological design and how different colors make people feel.
• Use contrast to highlight important features of your homepage, such as buttons.
• Try to pick two fonts (a maximum of three) to use across your store. 
• Choose a body font that is easy to read (sans serif fonts like Helvetica are generally easier to scan on a screen).
• Add your logo to appropriate places across the site, including the favicon.

In this example from Then I Met You , the brand’s homepage features limited fonts that are easy to read, a color palette that evokes calmness and self-care, and branded elements like a page logo and product packaging:

Customizing your checkout 

Customizing the checkout of your online store means adjusting settings, messaging, and other details that dictate the checkout flow for customers and help you accept payments online. Some of the options available on most ecommerce platforms include:

• Customer contact. You can let customers choose how they want to be contacted by you after placing an order (email or SMS text messages).
• Form options. Here you can decide whether extra information like a first name or company name is hidden, optional, or required at checkout. 
• Order processing. You can find options to streamline the ordering process or add an additional confirmation step. 
• Abandoned checkouts. When a customer reaches your checkout and decides not to complete their purchase, you can set up an automated reminder email for these shoppers. 
• Customer accounts. You can choose whether you want customers to create an account at checkout. This can be useful if you’re running a wholesale or members-only store. 

Customers on ban.do ’s website can opt to check out as a guest, sign in, or create an account before they purchase:

💡 Tip: When in doubt, prioritize choices that reduce the friction of checking out for the majority of your customers.

📗 Read more:  Ecommerce Checkout Best Practices: 11 Tips for Success

Establish shipping settings

Shipping can be one of the most complex considerations involved in running an ecommerce website . Between product weights, packaging costs, shipping destinations, carrier rates, and your potential profit per order, there are a lot of variables to juggle.

Depending on the unique needs of your business, choose a shipping strategy (or bundle a few) that works for you. Some of these include:

• Offering free shipping. This can be an incentive for customers to shop with you, whether it’s applied to certain products, order minimums, or regions of the world. 
• Charging real-time carrier rates. Many platforms integrate in real time with carriers like USPS and Canada Post to generate shipping options and live pricing. 
• Charging a flat rate. Flat-rate shipping works best when your products have similar sizes and weights, making actual shipping expenses easier to predict.
• Offering local pickup/delivery. You can also give local customers the option to pick up their online order at one of your locations, setting specific notification settings, pickup instructions, and other details for each location.

📗 Read more:  Beginner’s Guide to Ecommerce Shipping and Fulfillment

Sell internationally in minutes with Shopify Markets

Shopify Markets helps you sell to multiple countries and scale your business internationally—all from a single Shopify store. Manage store localization, shipping, duties, and compliance all in one place.

Within the shipping settings of your ecommerce platform you’ll also set shipping zones (where you ship and what delivery methods are available) and conditional shipping rates (e.g., for bundling multiple goods or shipping overweight items).

In this example from Momofuku ’s ecommerce site, customers are prompted to spend more to reach the free shipping threshold:

Set up taxes

As a business that sells goods or services, you will likely need to collect taxes to send to the government each time someone orders from your store. Some exceptions apply, such as for digital goods in many jurisdictions, or for businesses that generate revenue under a specific threshold.

If you are required to collect and remit taxes, be sure to adjust the settings in your online store’s admin. You may need to set taxes by region, depending on whether you do business. 

🚨 Note: Consult with an accountant or tax professional if you’re uncertain about your tax situation. 

7. Connect a payment gateway

Next up is deciding your store’s payment methods and how you, as a store owner, will get paid. There are hundreds of payment gateways to choose from and some platforms like Shopify have their own gateways that help save you money by lowering or removing transaction fees. 

Once you choose a gateway, you will also:

• Choose payment options. Decide what payment methods you will allow customers to use. This can include credit cards, accelerated one-click payment options like Apple Pay and Shop Pay , or services like PayPal.
• Sell in multiple currencies. If you sell internationally, enable a currency selector to automatically convert your prices into the customer’s currency.
• Set your payout schedule. You can receive your payout daily, weekly, or monthly—it all depends on your preferences when it comes to your cash flow.
• Toggle extra fraud prevention measures. These include requiring CVV or postal/ZIP code verification to add an extra layer of security.
• Customize how you appear on your customer’s bank statements. This will help them connect a purchase to your online store.

Start accepting payments fast with Shopify Payments

Skip lengthy third-party activations and go from setup to selling in one click. Shopify Payments comes with your Shopify plan, all you need to do is turn it on.

8. Get your store ready for launch

There are a few additional steps to ensure your store is professional and ready to accept customers. These include:

Adding a custom domain

Installing relevant sales channels.

• Customizing your email/SMS notifications

Buying a domain is like claiming land on the web. That’s why it’s called a “web address.”

A custom domain is a fully branded URL that replaces the default URL that was created based on the store name you chose at setup. Navigate to the settings of your store and update your domain with the one you purchased at the start of these steps, or buy one from your ecommerce provider.

📗 Read more:  Find and Register Your Domain Name With Shopify

In addition to your own online store, there are additional sales channels you can use to sell your products. Not every sales channel will be relevant for your unique business, but here are some that are worth highlighting:

• Point of sale (POS). Many platforms offer point-of-sale solutions for accepting in-person payments and easily syncing physical retail sales with your online store and inventory.
• Social networks. You can sell your products on Facebook and Instagram , set up a shop on TikTok , and more.
• Marketplaces. Many shoppers start their purchasing journey on marketplaces like eBay, Amazon, Etsy , or Walmart. You can sync these sales channels with your online store.
• Google. Google is the most popular search engine in the world. Run Google Shopping campaigns and list your products for free in the Shopping tab in Google search results. 

Customizing your email and SMS notifications (optional)

You can use automation to set up email flows so that customers receive timely messaging at every stage of their journey from opting in to your email list to making a purchase to tracking their delivery. These help you increase productivity and reduce customer service debt.

📗 Read more:  Level Up Your Marketing Automations: Ezra Firestone’s Expertise in New Templates

9. Launch your store 🚀

You’re finally ready to launch! Most ecommerce platforms require you to set your store to live or remove password protection so people can find you and access your website.

Is your store perfect? Maybe not. But you’ve completed all the critical steps to get your store ready for orders. Going live helps you collect feedback in real time and tweak your design, settings, and messaging as you grow.

Here are some next steps and resources to help you ramp up your business after launching:

• Attract customers to your online store
• Drive traffic to get your first sales
• Learn from your traffic
• Optimize your store

When you go live, you can treat this as a “soft opening” for your business, testing the checkout and navigation with real transactions and beta testers (hint: these can simply be friends and family). Once your store is working as intended, announce your launch to the world!

📗 Read more:  14 Grand Opening Ideas for Any Business

10. Market your online store

Marketing is different for every business, but regardless of your strategy, it’s important to set up the right foundation to get the most out of your efforts as you drive traffic to your store. Dive into some of the elements of marketing for online stores.

Social media marketing

Social media marketing involves both using social platforms to share content and grow an audience organically and running paid social ads. Here are a few tips to get the most from social media marketing for your business:

• You don’t need every channel. Start with channels where your audience is already hanging out. For example, if your target customer is Gen Z, TikTok is a critical marketing channel.
• Don’t sell, add value. Ads and branded content should flow seamlessly with organic content flowing through users’ feeds. Add value with content that’s relevant, timely, helpful, and suited to the platform. 
• Be consistent. Be sure your brand shows up on social media in the same way it does on your online store, with consistent colors, imagery, and tone of voice. 
• Use social selling tactics. Enable shopping features on each channel to remove friction and leverage your link in bio to push followers to products, landing pages, contents, or special offers.

📗 Read more:  Social Selling: Tips and Strategies for Success

Search engine optimization (SEO)

Many shoppers turn to Google and other search engines as part of their purchasing journey, whether it’s to find a product they saw or heard about through a friend or they’re conducting some comparison shopping for a purchase.

Helping your online store’s pages and your products appear in these search results can generate organic traffic. You can achieve this with SEO tactics.

You already considered SEO when you set the search engine listing details and product descriptions for your website. But there are other areas of your store where you’ll want to keep SEO in mind, like blog pages.

Some SEO tips to drive traffic:

• Use a free keyword research tool like Keyword Surfer to find keywords with search volume and prioritize keywords that are directly relevant to your business. 
• Create content that answers common queries related to your product so that it may appear in search results for those keywords.

Crafting influencer and owner of craft store Made Everyday Dana Willard’s content appears in search results for “how to make a quilt” for this YouTube video and blog content on her site: 

📗 Read more:  The Complete SEO Checklist

One of the most important aspects of marketing is analytics. When you monitor traffic and sales generated by your store across all your sales and marketing channels, you can get a better understanding of what works and what doesn’t. That means you can put your energy and time into campaigns and channels that have the best return on investment (ROI).

Drive your business forward with Shopify’s analytics

Shopify's user-friendly reports and analytics capabilities help you make better decisions, faster. Choose from pre-built dashboards and reports, or build your own to spot trends, capitalize on opportunities, and supercharge your decision-making.

Create a successful online store today

Now that you know how to start an online store, you’re ready to put your knowledge to work! You can sell anything online, including handmade products, merch , and digital products . Your ecommerce business will be a work in progress as you grow. Build a profitable online store by reaching your target customers with the messaging and products they’re looking for.

Additional research by Dayna Winter

• How to Start a Dropshipping Business- A Complete Playbook for 2024
• What is Shopify and How Does it Work?
• AliExpress Dropshipping- How to Dropship From AliExpress
• The 13 Best Dropshipping Suppliers in 2024
• How to Build a Business Website for Beginners
• How to Start an Online Boutique- A Complete Playbook
• 130+ Dropshipping Products To Sell for Profit
• Amazon Dropshipping Guide- How To Dropship on Amazon (2024)
• How to Start a Business in Texas- 8 Easy Steps
• A Guide to the Good Life- How to Start a Lifestyle Business

How to start an online store FAQ

Can i start an online store with no money.

You can start an online store with no money by creating a free trial with most ecommerce platforms. Expect to spend a small amount, however, for basic plans on most platforms. 

How much does it cost to start an online store?

The cost to start an online store depends on a number of factors. Expect, at minimum, to pay a monthly fee for ecommerce web hosting and a plan, as well as transaction fees. Some plans start as low as $5 per month. You will also need to factor in associated costs like paid ads, inventory, and overhead expenses like internet, electricity, and rent.

How do I start my own online shop?

To start your online shop, you first need to have a brand and a product or service to sell. Then, set up an online store on an ecommerce platform, including adding design customizations, products, and key pages to your online store website. Launch your store and market it to gain customers. 

How can I create an online store without inventory?

Depending on your business model, you can create your online store with no inventory. These models include dropshipping and print on demand. With these methods, another party, like a vendor or print-on-demand service will handle the shipping for you. You will manage the sales, marketing, and customer service for your online store.

What is needed to run an online store?

To start an online store, you will at minimum require a device like a laptop or mobile phone, internet access, an ecommerce platform, and startup funds to pay for web services and other fees. As you run your online store, you may need to pay for inventory, invest in packaging supplies, find space for storage and order fulfillment, and pay for professional services and ads, depending on your business model.

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How To Start A T-Shirt Business (2024 Guide)

Updated: May 6, 2024, 9:52pm

Table of Contents

Step 1. make a plan, step 2. register your t-shirt business, step 3. find the right production method, step 4. create unique designs, step 5. choose your sales channels, step 6. build your website, step 7. market your t-shirt business, frequently asked questions.

There are more ways than ever to start a business that also gives you a creative outlet. Selling T-shirts with your art, words or anything else printed on them is a great way to exercise your creativity and make money. A T-shirt business can make you a small profit on every unit you sell, which can add up to a great source of extra income. Learn how to start a T-shirt business with our simple guide. We’ll help you start your new side gig or full-time T-shirt career in just a few easy steps.

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Before starting to sell T-shirts, you have to make a plan to help guide your actions toward success. Follow these seven steps to sketch out a path forward for your business, but don’t worry if you don’t have all the details yet. You just need to have an idea of where you’re headed so that everything flows smoothly once you get started.

First and foremost, you’ll need to pick a name for your business. Whether it’s just your name or something different, that will guide your process of creating a logo, business cards, a website and other branded assets.

Once you’ve chosen a name, you can register a domain so that when setting up your website you’ll be all set to link it with your brand. Shopify and Etsy are popular options for selling T-shirts online, but if you want to build your own custom website, you should get started quickly so your website is ready to launch with your products.

Whether you intend for your new venture to be a side hustle or full time, you should register your business as a sole proprietorship or a limited liability company (LLC) . Registering as an LLC will give your business more tax benefits. You’ll also be able to buy blank T-shirts at cost with your EIN (as opposed to your personal Social Security number).

It can cost anywhere from $50 to $100 to register with your state. You should also familiarize yourself with your state’s legal requirements for small businesses and make sure everything’s in order.

If it’s too large a time commitment to go through the process of setting up your business, you can pay an LLC service to set it up for you. Investing in this service and saving your time will give you space to focus on the creative aspects of your business.

Start an LLC Online Today With ZenBusiness

Click on the state below to get started.

There are a variety of ways to produce printed T-shirts for people of all skill and knowledge levels.

If you’re committed to working with materials yourself, you can purchase screen printing equipment for your home or office. This gives you a great measure of control over the quality of the art and designs printed on the shirts, and if you enjoy creating social media content people love to watch creations take shape on TikTok and Instagram. The upfront cost of these machines will be high, but then you will have higher profit margins since you’ll only have to pay upkeep costs.

It’s also very easy to find local businesses that provide screen printing services for you. This means you’d have to take on the cost of paying these vendors as a part of your initial budget. However, a local service, or a company that’s far away but with whom you have a good relationship, will also be good for keeping an eye on quality control.

There are also print-on-demand services that are very reliable if you want to get started immediately. Services like Printful and Printify have fast turnaround times and allow you to sell as many products as possible without assuming the cost of any unsold products. However, the profit margins for these products are smaller because of the cost of individual printing.

Before printing, you need designs that reflect your brand’s goals. If you’re starting a T-shirt business to highlight your own drawings, paintings or digital designs, you’ll need to ensure they are saved as the correct digital files (usually vector files, such as .eps) that can be used by your printing service of choice. If you make highly intricate designs, you’ll probably want to do some test printing to see if everything prints on the shirts clearly. If you’re just starting out with design, there are a lot of free tutorials for using Adobe Photoshop and Canva to create designs.

There are also thousands of great artists whose work you can commission through websites like Creative Market, Fiverr and Upwork. When you find an artist, you can purchase their work outright, but if you have a good relationship with the artist and want to continue working with them, a profit-sharing relationship might be more sustainable for the future.

If you’re stuck on ideas, you can get insight for new designs by checking sales numbers of T-shirts on Etsy or using the tool Jungle Scout (which shows you how many units a product has sold on Amazon). Additionally, a Google trends search of various slogans you want to design for your shirts can show you which are the most popular and probably the most likely to sell.

Once you have the designs ready, customers will want to see how the T-shirts look on real people. Placeit is an easy service to use that gives you a bunch of photographs with blank T-shirt products onto which you can put your designs. You can also look into stock photo packages that include photos of people wearing blank shirts, and you can use Photoshop to put your designs on yourself.

Finally, if you have the time and connections, you can hire a local photographer and get some models for more dynamic action shots. It depends on your budget and how many shirts you’re producing.

When you’re ready to sell, it’s time to choose a sales channel. You can host sales on your own website, but online marketplaces are also an easy way to sell.

If you choose a third-party seller, you’ll have to start an account and set up your store. Services like Etsy, Zazzle and Redbubble are known to sell a lot of clothing and get a lot of customers. You can also sell through Amazon or on social media.

Before choosing, you should check the prices of these services and see which one will be the most sustainable for the long term.

Even if you’re selling on a third-party marketplace, you need a website to promote your T-shirt business. Here are the best e-commerce platforms for building an online store:

• Shopify : strong sales reporting capabilities, ability to customize storefront with design templates
• Wix : free plans available, easy user interface
• Weebly: e-commerce in the lowest-price plan

All of these services can be integrated with a print-on-demand service, if that’s how you’re producing your T-shirts. These make it easy to sell and promote however you choose, and can even ship the merchandise directly to your customers so that you can focus on the creative side of things.

Marketing a fledgling business can be difficult, but there are low-cost ways to do it. If you’re targeting a specific niche, you can look into communities online like subreddits and Facebook groups where you can post your T-shirts to bolster interest.

You could also try to reach out to micro-influencers and ask for their engagement rates to see if they would have decent conversion rates. Influencers that are just beginning to take off are also likely to support a small business just starting out.

Which is better: Printful or Printify?

It depends on which metric you want to save money on. Printify has lower production costs than Printful. However, Printful has better international shipping rates.

How do you create shoppable posts on Instagram?

You can create shoppable posts through tagging the product in the same way that you would tag a person. Set up your Instagram shop first, then you’ll be able to tap items in your photos and link them to a product listing.

What is the average profit margin on a T-shirt?

Most sellers set their profit margin around 50%. So if your cost for the shirt + printing is $10, you might sell your shirt for $20. Setting a higher profit margin may enable you to offer free shipping.

Do I need a business plan to start a T-shirt business?

While you don’t need a business plan to start a T-shirt business, it’s a good idea to create one. The reason being is having a strong business plan will help you stay true to your original vision. Planning out your suppliers, goals and general growth plan will set you up for success in the future.

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Julia is a writer in New York and started covering tech and business during the pandemic. She also covers books and the publishing industry.

Cassie is a deputy editor collaborating with teams around the world while living in the beautiful hills of Kentucky. Focusing on bringing growth to small businesses, she is passionate about economic development and has held positions on the boards of directors of two non-profit organizations seeking to revitalize her former railroad town. Prior to joining the team at Forbes Advisor, Cassie was a content operations manager and copywriting manager.