How To Start A Boutique Business

This article is a response to the commenter (Anonymous) at my previous post, requesting about Bridal Boutique.

First of all, we need to fully understand the nature of the business by asking one simple question, "What is a Boutique?". Here is a definition from wiseGEEK:

A boutique is a small retail store which focuses on selling unique items, or items targeted at a niche market. Boutiques are established to sell a wide range of things, although products like clothing, food, or jewelry are common offerings. Many people associate boutiques with elite, special products, and they may pay a premium for goods purchased in a boutique. 

And just by that definition, you should be able to comprehend that a boutique has its limitations but well-paid off benefits.

Being an Elite and Unique Shop
Unlike other retail shops, boutiques are specialized shops and only sells unique, quality items with one or more lines of products. Basically, if you ever need to find high quality branded items, boutique is your one-stop shop for them. Other retail shops or convenient stores, sells a wider range of products and cheaper too. But as they say, "Buy cheap products, no good. Buy good products, no cheap."

Step 1: Legalize
I am going to assume that you have already done all the necessary steps to legalize the business (i.e. register the company name, approval from government authority to operate, receiving 16/17 certificate, etc.) and let us move to the next step - Location.

Step 2: Location
This step is of the utmost importance of all. One factor to look at while finding a place is the market its situated in. A nice note from wisegeek.com:

Many resort towns and areas which cater to wealthy populations have a high concentration of boutiques in their shopping districts. 

Which means that boutiques are very popular in booming shopping districts (i.e. for Brunei, they are; Kiulap, Gadong and Bandar.) which also means direct competition with them (depending on the type of boutique and products they sell that is in a different niche`, then it would be considered as indirect competition.)

Taking for example: Bridal Boutique. If other boutiques in the area are lingerie, watches, jewelries and health food and supplements, this will be considered as an indirect competition. Which leaves less or equal to the threats imposed onto a Bridal Boutique. But if there is a competitor in the market, then chances of successfully winning the competition is dependent on the quality of the products available for sale. And do not worry if there is an existing competition in the area. That would already indicate that there is a market for such products and all one has to do is to offer better.

To the point, place the boutique at a highly dense wealthy population area and start competing. Boutiques placed elsewhere will only spell doom due to a number of reasons:

1. The population doesn't have the money to spend with.
2. There is not enough people to sell to.
3. If there is no traffic in the area, it means less people go by, also means less potential customers.

There is no other way around it if there is a need to succeed in this type of business.

Step 3: Product/Service
Just as by its definition, boutiques are actually more of a distributor of high quality brands. If one can find a brand so unique and original that it cannot be found elsewhere, that is where one can win the market. However, if the competitor(s) are/is smart enough, it is only a matter of time till the competitor(s) can get a hold of the supplier and managed to sell the same thing or better. So the key here is, find a high quality brand, original, unique, grab a hold of it as soon as possible and start selling. This is the main focus of the boutique business while, of course, following or be the top of the trend.

Service-wise, one can go for membership programs. Where the client can join in on the boutique's latest offers, updates, and gets some small benefit as they continue to keep shopping there like more discounts as they keep shopping. This is to ensure customer loyalty to the business. They say that when one have already built a large customer base, they can then expand their boutique to a large departmental store or shopping center to enable more product range and selections offer. Examples in Brunei, Hua Ho and Soon Lee.

Step 4: People
The thing I like about a boutique business is because of its utter "simplicity but better" concept. But with high quality products comes with high quality service.

The basic jobs at a boutique:

• Manager - Manages the whole business and finance it.
• Cashier - To account and manage payments with the customers.
• Marketer - Leads customers to the boutique, provides customer support and increase business awareness.
• Salesperson - Attracts customers that are in the shop and assists them with their purchase.
• Graphic Designer - Creates trendy images. This job is critical to have because when one opens a boutique, image is everything especially on first impressions and fashion.

Marketers and salespeople are basically the same. I separated it into two because one needs to stay in the boutique to close the deal, while one goes out and opens a deal. That is the basic flow of the traditional business.

The advanced jobs at a boutique:

• IT Specialist - Responsible on creating an e-commerce site. Opening up a whole new market of selling branded items through the Internet.
• Accountant - At first, the cashier or the manager can handle the bookkeeping, but when there is too much workload and the boutique is really booming, one may need to delegate the bookkeeping tasks to a qualified accountant.
• Purchase Executive - This was the manager's role. To search, research and purchase high-quality brands and have it up for re-sell. While consulting with the accounting department, one must be able to budget the spending limit on purchasing quality items. Purchase Executives are also responsible for purchase negotiations, researching the trends in the market and find the most promising item up for re-sell.

Step 5: Operation

There is not much to say on the forefront of the business but basically sell, sell and sell. The way to sell them is how unique one would convey a marketing message. Some would publish an article with an image of their boutique to the local media (i.e. Press Release) and in that article, along with a special advertisement message to notify a discount sale or bargain hunting opportunity (*hint*coupons*hint*).

But aside from all the selling and marketing activities, the business needs to be kept updated with the new and latest trendy products for sale. Purchase executives and marketers play a key role to find out what is the most popular product in the market for re-sell. This is very important if one wants to maintain customer relationship with the business. And also as important as to beat the competition (if any) with the availability of trendy and popular products up for sale.

Competitors
For competitors in Brunei, there are already one too many. According to the business directory at OneBrunei.com, there are 90 (registered to the site's directory) boutiques all over Brunei. Most of them are located at Kiulap, Gadong and Bandar. There is not much to say about them at the moment. I suppose that's where you have to go out and see what they do and outsmart them.

Expected And To Be Expected
A very slow business start-up, due to the fact that its not cheap and depending on the marketing strategies implemented to get some sales in. But once it hits the market and becomes the "talk of the town" for its unique and quality brands, the business will steadily be more busy than ever. Break-even point is probably around 2 years, plus or minus.

Like I said, the utter simplicity but better concept.

Final Thoughts
Owning, running and managing an elite shop will be very difficult. At most, at least get an initial budget ready of  $65,000. This is to ensure that the business will be doing fine in its start-up. All the best!

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