How much does it cost to start a boutique business in India?

How much does it cost to start a boutique business in India?

Any regular business including boutique business has 4 main factors that must be dealt with

  1. Finance/capital
  2. Product/Service
  3. Operations
  4. Marketing

Starting a boutique business is no exception and has these above-mentioned factors. Successfully managing the above four and avoiding simple mistakes can lead your business to success.

In India, as many of us know, Boutique business is generally started by women. Boutique generally means a small shop that sells fashionable clothes or accessories. However in India, it is mostly sarees and traditional wear. There are also boutiques that sell designer wear.

Usually, boutiques are run by two kinds of people, generally speaking, women who have a degree in fashion technology and who are trying to create their own brand, women who are small scale entrepreneurs who get clothes from several brands and designers and sell them locally.

Boutique with Minimum Capital

If you want to start a Boutique, depending on your initial capital you can start it big or small. Generally, an amount of Rs.2 lakh to Rs.3 lakh is enough to start a small boutique. If you think your income is exceeding Rs. 2.5 lakh per annum, it is better to register your business either as self-proprietorship or LLP (if you have a partner).

Location of Store

In this case, you generally have to sell the products in your own house, creating a customer lounge area in the house along with storage space for your stock.

To know more, check out How To Choose A Right Location for business.

Products and stock

Select the products i.e., the clothes and accessories according to the standard of living and societal norms of the people around you (it is unwise to sell skirts for women in a colony full of traditional housewives). Set your prices perfectly! You can set your prices by adding the cost of stock with all the expenditure you have spent to get it and adding about 30%-40% of the amount for minimum profit.

Initially, spend more on marketing, this can lead to less profit, but it will establish your presence in your locality.

Do not over purchase stock at the initial stages no matter what kind of offer you get. Use tools like Toolny, Zoho, or Vyapar to keep track of your inventory and your accounts.

Invoices may not be necessary, but, if you give them, it will increase trust and also your accountability.

Marketing your Boutique store

Though the business might be small there are lots of marketing strategies you can use to increase your customers. Make a good relationship with most of the people in your community as most of them would be your customers.

Participate in every event in your community and also try to create few in the time of festivals or any auspicious day, make sure you build trust in the people around you so they would trust you and your products.

For your first customers and regular customers always send them the new stock that you want to sell via creating WhatsApp group or forwarding messages.

Having a website along with a presence in all social media with regular updates of your products will definitely help you grab more customers and also makes your business look trustable and legitimate. Use tools like Toolny, Zoho social, WordPress, etc. to create websites and manage social media.

To learn more, read our guide for effective marketing for small businesses.

Boutique With High Capital

If you have more capital to start a boutique if it is more than Rs. 6 lakhs, then you can rent a store/shop to sell the clothes.

Location of Store

When you rent a store to start a boutique, the interiors of the boutique matter a lot. Make sure the interior design and the products you sell are according to the standard of living and societal norms of the people around you as mentioned before (do not build your interior with so high cost for a regular locality where people would immediately think your products maybe overpriced even if they are not).

Registration to start Boutique Store

Since you have started a store, it would be preferable to register your business and also take necessary licenses (labor license, etc.) to run the store. If you are unaware of the requisites of registering a business or any other government/tax-related activities, it is always suggestible to take help from a Chartered Accountant. If you have a big budget, you can hire an accountant. However, it is always advisable to know all about the tax and government-related activity for wise future decisions.

Register your company with GST. Though, GST registration is for companies that have an average annual turnover of more than Rs. 20 lakhs, it is better to register your clothing business with GST to avoid tax complications. Additionally, GST registration is a must to sell your merchandise Online.

You can register your company with GST by clicking on this link.

You might also have to obtain a Labour license and possibly a Trade license to run a boutique.

To apply for a Labour license visit here, and for Trade License visit here.

If you are unaware of the procedure, you can always contact a Chattered Accountant who would help with it by taking some commission.

Products, stock, and staff

Initially, hire 1-3 staff depending on your capital. You can buy enough stock initially but do not overspend. Make sure the stock you buy is good, do not compromise on little things or any kind of doubtful sale. The merchandise dealers may guide you more about the business but never trust anyone too much. Generally, the stock worth should be around 50% of your total initial capital.

If you are very much unaware of where to buy stock, you can always google suppliers. But beware of fake sellers and tread carefully. It is suggested to surf through various boutique businesses, asking those owners how they get their stock and how they manage the business. This could give you a lot of insight into the business.

Marketing your Boutique Store effectively

Market your store/shop using the above-mentioned marketing techniques along with registering your boutique in various local business apps/websites (e.g. Google Maps, Amazon, Myntra, etc.)

Make sure you have time to spend with your family and friends. There are several tools available in the market that can improve your business as well as save you time. You can use tools like Vyapar, Zoho, WordPress, etc. to manage your business, however, choosing Toolny is preferable as it is easy to use, saves a considerable amount of time, and comparatively cheaper than other alternatives.

To learn more, read our guide for effective marketing for small businesses.

Other key points to run Boutique Store successfully

If you are a designer and want to run a boutique it is better to have a partner who can take care of business activities when you are busy designing new products. Though you may display your self-made products, it is better to put some other accessories and products as well. Give customers the opportunity to buy products that you personally cannot make, this improves your business. For example, if you make traditional sarees and kurtas, make sure you also sell products/accessories related to your product. If these accessories are made by another designer, you can partner up with that designer to improve the efficiency of the business.

If your goal is to scale up your business and build a brand, then concentrate on building products that appeal to a large number of customers in a proper niche. One thing, that you need to do initially if you want to build a brand is to advertise your product rigorously.

Few helpful strategies to attract more customers

  1. Conduct kitty parties or call your regular customers for tea regularly.
  2. Conduct small social events for the people around to interact and have fun as this not only helps your business but also helps you.
  3. Always ask your customer for feedback and value their judgment if you see it right. When you change your approach using the feedback make sure the customer knows about it.
  4. If you can spend, spend some amount on advertising online as well as in local newspapers.
  5. Make sure you provide seasonal discounts and sales regularly.
  6. If you are not accustomed to the fashion industry, get regular knowledge about different kinds of brands and trends. Follow various pages, accounts, and websites online.
  7. Make some company/business policies for yourself, your staff, and your customer and follow them with absolute discipline.

To learn more about how to run the boutique, you can read our other article How to start a clothing business/store in India?


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