How To Start A Gift Basket Business
Learning how to start a gift basket business can lead to a rewarding career or an extra income opportunity. Retail gift baskets have grown in popularity and are a fairly low cost way for creative entrepreneurs to enter the retail business world. Many gift basket businesses start in private homes on small budgets and grow through time, energy and capital input to meet customer demand. If you are interested in starting a gift basket business, there are a few simple steps that you can take to get your business off on the right track.
To start a gift basket business you will need:
- Creativity and the desire to learn about trends and techniques in the gift basket industry
- A business name
- Business Plan
- Wholesale inventory suppliers
- Business liability insurance
- Qualified attorney
- Qualified accountant
- Business marketing ideas
- Research the gift basket market. While gift baskets are popular gifts, a gift basket business is also a popular venture. If you plan to make your mark on the gift basket world, find a creative angle or a unique specialization to set your business apart from the pack.
- Thoroughly plan your gift basket creations as well as your business. Research and compare the pricing and incentives of suppliers for all of the supplies that you will use in the business. Develop a basic pricing model and check out the profit margins that you should expect. Certain gift specialties may yield higher retail prices than others, but they will also generally hold a higher cost margin as well. Will you begin your business in your home or rent a location? All of the costs of conducting business must be researched and profit/losses considered during the initial planning phase.
- Create a business plan. A business plan is important whether or not you plan to initially seek outside financing or just need to focus your efforts realistically. Your business plan will force you to thoroughly define your business and related services as well as establish marketing and long term goals.
- Choose and register your business name. There is a lot involved in choosing a business name. Is the name unique? Is it too unique to be remembered? Will your business be online? If so, check out domain name availability before settling on your favorite name. Legally register your name with state or local regulatory groups as required.
- Apply for business licenses and file appropriate paperwork. Many U.S. states have small business organizations that offer free guidance to entrepreneurs seeking to open a business in the state. While these services may be available, it is important to remember that it is the sole responsibility of the business owner to insure that all federal, state and local requirements are met for their respective business. Enlisting the advice of an accountant and an attorney helps to avoid any oversights!
- Do not overlook business insurance. While some homeowner insurance policies may cover certain small business activities conducted from the home, holding a separate business policy may be in your best interest to protect your personal assets. Again, be sure to discuss your personal business plan with a qualified attorney.
- Build an inventory or create business relationships for gift basket supplies. Many home-based gift basket businesses start small and add inventory as sales are made while others opt to build larger inventory stashes from wholesale suppliers. Most suppliers require business licenses or tax identification to set up wholesale accounts and offer the best prices.
- Market your gift basket business. As part of your business plan, you should have created a marketing budget. If you are beginning with limited resources and are planning to market through word of mouth or social networks you may need to be creative in your marketing efforts to get your business moving.
- Plan ahead and thoroughly document sales, expenses and customer correspondence. Meet with an accountant to discuss the type of record keeping that is best for your business and financial situation. Staying organized from the start will prevent chaos at business reporting or tax time!