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27 Oct

How Much Does It Cost to Start an Online Boutique?
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(Last Updated On: November 11, 2020)

Starting an online boutique is a great way for a creative, Internet-savvy entrepreneur to make money. It doesn’t cost a lot to start an online boutique and you can run the business from home.

In this article, we’ll explore what an online boutique is, discuss how to create one, and look at the cost of starting an online boutique. We’ll focus on start-up costs, but with one eye on recurring expenses. The low cost of setting up an online boutique may surprise you!

This article is part of our How to Start an Online Boutique Guide – check it out for a full guide covering inventory, domain registration, web design, and many other aspects of building and growing an online boutique.

What Is an Online Boutique?

We’ve all seen brick-and-mortar boutiques. They sell fashion-oriented product lines and usually have a female customer base. Sometimes, there’s a man waiting outside holding a purse.

An online boutique is the eCommerce version of that kind of business. It sells a curated product line target at a well-defined audience. Because it’s an eCommerce venture, starting and running an online boutique from home is a viable option, as we’ll discuss in the next section.

How much does it cost to start an online boutique from home?

You can create and run your online boutique from home because all contact with customers and suppliers can be done over the Internet.

First, you can use the Web to research what you’ll sell and learn more about the people you want to sell to.

Setting up the infrastructure for your business can be done online as well. You’ll find a hosting company, purchase the domains you need, register your business, and either build your eCommerce website or have it created for you.

You can use the Internet to research suppliers, and when the shipments arrive, you may have a corner of your house that’s perfect for storage. With a rudimentary home photo studio, you can create product images that have a professional look. You can ship all products yourself—a couple of trips per week to the post office should do it!

A home-run online boutique can be a great source of income. If you keep your target audience engaged and continually attract new customers, you’ll grow your customer base and generate sustainable revenue. 

Startup Costs for an Online Boutique

How much does it cost to start an online boutique?

There are a lot of variables, with your product line being a prime factor. As discussed in the sections below, infrastructure costs will be low; the bulk of your initial outlay will go toward inventory.

Domains & Hosting—The Bones of Your Business

When shopping for domain registration and hosting services, you’ll find a competitive marketplace. For that reason, you can apply strict criteria—there’s no need to settle for a service that doesn’t meet all your needs at a fair price.

You should expect to pay between $1 and $15 per year for each domain, depending on the domain ending. Pick .com, .net, .biz, .shop—whatever reflects your brand. To protect your brand, buy variations of your domain.

When you select a hosting plan, the most affordable type will be shared hosting, and it will meet all your needs, at least in the beginning. With shared hosting, one computer runs many websites. Some providers, having perfected this service model, can offer customers secure, reliable, and scalable hosting at remarkably low prices. Typically, you can expect to pay just $30 to $50 per month; setup fees should be either waived or so low they’re negligible.

At HostPapa, we decided to drastically reduce that cost – our WordPress Hosting Business Pro Plan is only $12.95/month, and comes with unmetered bandwidth, live support, free domain registration, unlimited email accounts, and essential and advanced WordPress features pre-installed.

To get a running total going, let’s start with a couple of line items:

  • Five domains, average $10 each: $50
  • Your first month of hosting service: $40 (or $12.95 if you go with our WordPress Business Pro plan)

We’re up to $90, but we need a website!

Web Design: A Worthy One-time Expense

Establishing your online boutique means building brand awareness. Outreach via social media, email, and digital ads will lead people to your website. Your landing page will have to look amazing. The site should be easy to navigate, compel visitors to explore your products, and make it easy for them to buy products.

It makes sense to delegate the task of web design. You can turn your product image library over to a skilled professional who will create a unique website design, write engaging copy, implement SEO that attracts your target audience, and more.

Expect to pay between $100 and $200 per month for a website creation service that handles the initial design, launches your site, and maintains it. The setup fee for a service like that should be nominal, but for hands-off, fully managed eCommerce functionality, you could pay between $400 and $600 in setup fees.

You will need eCommerce features, but there are free solutions available. For a smart, cost-saving approach, you may opt for a turnkey website but implement your own eCommerce solution. Let’s go with that scenario to update our running total.

  • Five domains: $50
  • Your first month of hosting service: $40 (or $12.95 if you go with our WordPress Business Pro plan)
  • Custom website creation: $150

We’re only up to $240. Not bad!

Inventory: Store It Yourself to Maximize Control & Profits

Your boutique needs products to sell. You can follow a stock-on-hand model, in which you order items from suppliers, store them until they’re purchased, and then handle shipping. An alternative is drop-shipping, where your supplier ships products directly to your customers. Drop-shipping makes it hard to verify the quality of the products you’re selling, and it eats into your profits.

To keep costs down and take control of the customer experience, you should start with the stock-on-hand model. Limit your initial order—consider your supplier’s minimum order and your available storage space. An order of around $1000 for your first month of operation is a good place to start. What does that do to our running total?

  • Five domains: $50
  • Your first month of hosting service: $40 (or $12.95 if you go with our WordPress Business Pro plan)
  • Custom website creation: $150
  • Initial inventory: $1000

Assuming you can store the products at no cost, and you shell out for $100 worth of shipping supplies—that brings our first-month total to $1340.

Customer Engagement & Advertising

Many online retailers rely on digital advertising, but it’s expensive. What if your email and social media engagement were so effective you didn’t need to spend a dime on pay-per-click (PPC) ads?

It’s possible to generate a lot of traffic for your site by creating an active, engaging presence on social media. Instagram and Pinterest are especially useful for attracting the target audience of an online boutique. You can reach out to followers with email marketing and draw people to your website with helpful content.

For a business seeking a fast start, PPC ads may be the way to go. In the eCommerce sector, Google Ads have a cost-per-click of $1.16, which can add up to a monthly bill in the thousands. But the ROI is impressive, with businesses seeing an average of $2 in revenue for every $1 spent on Google Ads.

If you can afford a few months of revenue ramp-up time, see if you can achieve your initial goals without using PPC ads. With that approach in mind, we’ll omit advertising costs but acknowledge the extra time you’ll need to build a customer base. Let’s call it a 3-month startup phase:

  • Five domains: $50
  • Custom website creation: $150
  • Three months of hosting service: $120 (or $39 if you go with our WordPress Business Pro plan)
  • Three months’ worth of inventory: $3000

In three months, with $3320 and all your entrepreneurial skills in play, you can start an online boutique!

An Affordable Venture that Can Lead to Incredible Profits

How much does it cost to start an online boutique? Based on the loose estimates we discussed above, it’s safe to say you can do it for less than $5000. That’s a low cost of entry into what can be a very lucrative marketplace.

We hope this look at the monetary requirements of a fledgling online boutique has been helpful and that your one-of-a-kind boutique gets off to a great start!

Tim Mattson

Tim is a freelance writer focused on helping people achieve their business goals through digital marketing.

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