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Everything You Need to Know about Opening an Online Boutique in the US

How to Open an Online Boutique in the US

January 28, 2021
9 MINUTES
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Stefanija Tenekedjieva

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Considering opening an online store? Learn all the ins and outs of managing a small business on an ecommerce platform with this simple guide.

Plenty of boutique owners had to reiterate their business plan and reconsider opening an online business for their boutique store. The Covid-19 pandemic fully sealed the already-changing shopping habits of people, who revert to dropshipping for lower prices, instead of accepting wholesalers’ and big retailers’ sums. Websites like Amazon, eBay, Alibaba, Etsy and Shopify made it possible for small business owners to sell their products online for affordable pricing and to a much larger target audience.

At the same time, more and more sellers start from scratch directly online. The era of exclusively brick and mortar storefronts is gone, and it is smarter to directly open a new business online, and target more potential customers.

In this guide, we’ll help you lay out a workflow through simple steps you need to follow to open your own online boutique. Keep in mind that we won’t go into detail in every single step, but will supply further reading material in the links.

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Find the right name and domain

As with any business, you need to think of a good and catchy business name and a domain that will be memorable, easy to search and doesn’t look spammy. No one that sees a domain name like bestclothesshop.xyz can ignore the alarm in their head immediately. So think it through and wage the possibility of making a custom domain name when you’re choosing the right ecommerce platform for you (we’ll talk more about that in the next section). Most ecommerce websites don’t allow a custom domain name in the free plans, so you’d have to purchase a premium plan.

Create a brand identity, logo and key value propositions

Before you register your online boutique, you need to build a brand identity, complete with a logo, brand colors, value propositions and a mood board on which you’ll base your future marketing and branding assets.

The logo is presumably the most important element of your branding, since it will serve as your brand’s identity. You will apply it in social media posts, on packaging, your website, and other elements. So think it through and don’t go for a cheap, editable template. That is easy to create, but in the long run, doesn’t help you stand out. Check out this list of good boutique logos to get inspired and think out an idea for your own logo.

Register your online boutique

This step might be done simultaneously or after registering a website, but from my logic, it’s better to actually have a legal business upfront before you start selling. Basically, before being able to receive payments, you have to register your online boutique so as not to be fined or penalized for tax evasion or selling illegitimate merchandise. Here’s what you need to do to stop the IRS from coming a-knockin’ on your door:

  • Choose a business structure
  • Register with your respective state
  • Acquire a tax permit
  • Stay informed on tax requirements

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Choose the business structure

There are three types of business structures, that depend on the type of business you’re operating and its size:

  • Sole Proprietorship—in this structure, you run the store by yourself under your name. You are the only owner of the full liability for the store’s legal obligations. This model is the simplest to manage and requires the least paperwork out of all three.
  • Limited Liability Company (LLC)—you as a person aren’t liable for the debts of your business, which is better protection for your business and yourself.
  • Corporation—a larger size business model that is only suitable if you are planning to spread your business and work on a big scale.

Register with your state

If you decide to register as a corporation or LLC, depending on the state you live in, you might need a licence to sell. You also need to register your business name in the respective state your business will be legally operating in (that means where you pay taxes, fulfill obligations and have law protection, you can still sell outside your state online).

In case you want to register for a business license as a sole proprietor and want a different business name than your personal name (a DBA, Doing Business As), you will have to register that name with your state.

Get a sales tax permit

No matter which one of the three business structures you choose, you need to obtain a sales tax permit issued, as well as a tax ID number that is issued by the Internal Revenue Service.

Inform yourself of the tax requirements

Each US state has particular tax requirements, so you need to research your respective state’s rules and regulations. Here You can find the directory of state IRS websites. Once you learn what you need to do, stick to it. As with any business, paying taxes and adhering to the legal requirements is an important step to success.

Find the right ecommerce platform for your online clothing boutique

Now that you have a business registered and a brand to be reckoned with, you can move onto the actual step of selling online: creating a website on an ecommerce platform.

Before you make your ecommerce website, you need to research all the perks and possible red flags of each ecommerce platform. The good thing is that most of the big players in this industry allow payment through PayPal or credit card, as well as other payment methods, so you don’t have to worry about your clients’ safety.

However, each ecommerce platform has its characteristics and features that will make your choice a hard task. Here’s what you should consider when making your decision:

  • Pricing plans
  • Transaction fees
  • Customization options
  • Additional apps
  • Marketing features
  • Shipping costs and shipping rates
  • Design options
  • Ease of management
  • Domain name customization, etc.

Here are the best platforms and their key benefits:

Shopify

Shopify is definitely the best all-in-one ecommerce platform that offers plenty of customization options, payment methods, has acceptable transaction fees and is an all-in-all great and easy to use website builder. It has plenty of features that help you with marketing, SEO, as well as its own Shopify Payments service. However, even Shopify isn’t completely immune to scams, so you should get informed about them. You can read further about Shopify Customer Service and how it ranks compared to Wix.

Wix

Wix is the best platform when it comes to web design templates and customization. If you need a pretty and fully customized online boutique, this is the option for you. It also has plenty of features, plugins and additional apps that help with functionality, such as email marketing features and social media plugins.

Still, Wix isn’t predominantly known for being an ecommerce website, and is more of a drag and drop website editor. However, some of its premium plans have ecommerce functionalities as well. Read more about Wix Payments in our article here.

BigCommerce

It’s no surprise that BigCommerce is perfectly suitable for big retailers and corporations that sell their products online. So, for someone starting up a small clothing business, it might be an expensive choice and a pond too big for a small fish. However, it has a large customer base and plenty of great features, like fast checkout, abandoned shopping cart recovery, advanced search filters, etc.

Squarespace

Squarespace is very similar to Wix and Shopify but is more popular in the creative industry than the fashion industry. It’s a website builder that boasts plenty of good looking and highly functional website templates, and some of the premium plans have ecommerce functionalities too. Squarespace has a smaller user base, which has its own perks: amazing customer support and great features for email marketing and social media marketing.

WooCommerce

Unlike the rest of the entries on this list, WooCommerce is not a website builder, but a WordPress plugin that adds the ecommerce functionality to an already existing WordPress website. So, it’s a great solution if you already have a website for your business (or previous brick and mortar boutique), but want to make it an ecommerce site now. If you’re only starting out, stick with an all-in-one website building platform that includes ecommerce functionalities too.

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Double-check your suppliers and dropshippers

If you sell your own products and use a dropshipper through an ecommerce platform, or you are sourcing your products from a wholesale supplier and selling them through your boutique, make sure they have good reviews, a reputable website and an image you can trust.

There are a few things you need to take into account:

  • Customer reviews
  • Your experience with the first time ordering through them
  • The quality of the wholesale clothing and does it meet your clothing store’s standards
  • The communication with the supplier

If you want to run a successful online boutique, you need reliable partners and good experience for your customers.

Market your brand

Finally, you need a good marketing strategy to reach your target customers. Market your brand through social media platforms, especially Instagram and Facebook. You also need a consistent and engaging newsletter, as well as promotion codes and flash sales, which are highly successful when it comes to ecommerce.

Think about partnering with fashion bloggers and influencers, since they have large followings of their own. You need to be consistent and true to your brand, but still, produce marketing assets that you can post regularly and are targeting your core potential customers.

Hopefully, this short guide will help you get a framework of all the steps you need to take when opening an online boutique. Research all the ecommerce platforms in detail, and make sure you follow all the legal steps and procedures. For anything branding and design related, hit us up at ManyPixels. Here’s our scope of work and pricing: from logo to brand guides, we’ve got it all covered.

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creations: illustrations, brand guides, ads, logos
and much more!

Download our design library to see our latests creations: illustrations, brand guides, ads, logos and much more!

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Stefanija Tenekedjieva

January 28, 2021

Journalist turned content writer. Based in North Macedonia, aiming to be a digital nomad. Always loved to write, and found my perfect job writing about graphic design, art and creativity. A self-proclaimed film connoisseur, cook and nerd in disguise.