The reason was that our products are unique and high-end. It only made sense to merchandise in a way that reinforces this image i.e. unique, high-end, and essentially, rare. The whole concept behind a boutique is that the products you sell are quality and not quantity and there is a uniqueness to them. ( If you were a walmart or a drug store this would not work. :) Another reason to merchandise this way is that subconciously, there is an implication that with only a few items on the shelf, this product is selling fast, and may soon be unavailable (i.e. creates urgency in the customer.)

For example, when merchandising fragrances, bath and body products, we always have marketing or press related displays that go along with the product. If you get press kits from your vendor (you should) and it has been in magazines like Oprah, In style or Lucky then I would suggest that you display that PR piece next to the product.

As an example, many people are always looking for Oprah’s favorite products. My point is that the more press or marketing you have to back up the line, the more customers trust the brand. Just make sure to display these articles in a frame next to the product. If you own a jewelery store or clothing boutique, press kits are key to catching customers attention. In our ebook we go into detail about what kind of vendors you want to work with and how to ask for support from them to help promote their line in your boutique or store.

So, that’s the warm and fuzzy side. Then comes the not so warm and fuzzy. Putting numbers together on paper, deciding on funding options, choosing solutions for employee taxes and payroll….generally all the stuff that induces yawning or sleep in most creative people. Of course, a very common motivation for having your own business is greater financial reward and freedom, and that goes for “creative types” as well. But even with dollar signs in your eyes, the dreaded (by most) “Business Plan” behind your boutique may not be as appealing as all that “fun” stuff I mentioned above. In fact, for a lot of small business startups, the biz plan is either way to thin, or non-existent. No matter how much “fun” it may (not) seem to us, it is very important, and should not be “permanently procrastinated”.

And, under the subject of business planning also falls business financing. Again, I think we can all intuitively agree on how important this is. None of us would get any business off the ground without it. And here is where most would-be entrepreneurs get the most hung-up. The thought process for many of us is “You have to be rich to own your own store or business…” Or, “it will take a fortune to get something like that started…” If these tapes aren’t playing in your own brain, there is a good chance they are being parroted out of the mouths of skeptical friends and relatives if/when you mention the idea of starting something of your own. (My personal policy is NOT to mention a new venture until I’ve already started it – I prefer not to risk contamination with the doubts of others…)

The fact of the matter is, start-up funding requirements can vary widely, from “that’s not so bad” to “ouch, thats a lot of money.” Variables include your own existing resources and talents, average costs for the product area you specialize in, whether your vendors will provide 30-day net right off the bat ( so you can earn money prior to paying them for inventory…) etc.

So, depending on your boutique, you may be able to launch on a shoe-string, or not. If not, you have to decide whether to use OPM (“Other Peoples Money”- could be bank or SBA loans, investors, venture capitalists, etc.) or (God Forbid) your own money. My personal take on this, after having the experience of launching retail and consulting businesses, is this; If your credit and situation allow, go get an SBA loan (in your business’s name i.e. form a corporation) or some other reasonable small business loan program. If this is not feasible, next best is to be using funds you raised (i.e. saved or acquired) and hopefully, follow the “shoe string” route so as to retain as much of your cash resources as you can, and still launch.

What I would NOT do: Categorically, under no circumstances, would I begin to think about using consumer credit (i.e. credit cards) to finance any aspect of my business, except maybe minor expenses such as supplies and gas, to be paid in full each month. This includes so-called “business” credit cards. Those are generally just typically high cost consumer credit lines that are marketed to the business community. They are no less dangerous in my book than any other credit card.

Why dangerous? Because they’re expensive, and can reak havoc on your credit profile should you have a period of struggle (like 90% of new small businesses) at any point in the first 5 years of your business. The other no-no in my book, which may be obvious to most in the wake of the sub-prime lending fallout of the past couple of years, is to put your home or other assets in hock to raise funds for a startup. Granted, a lot of people have probably done this, and some probably succeeded, but bottom line, this is not a sound business strategy. Namely, placing any of your personal assets at risk to fund a business is not good practice. Just read about Trump or Kiyosaki, and you learn that they subscribe to the OPM strategy whenever possible, and specifically, the creation of a corporate entity (i.e. the “corporate veil”) and establish credit specifically for that entity. This shields you from any personal loss in the event the business folds. That way, if the business does not take off, you’ve minimize your liablility, and protected your credit profile. Exactly what Trump did when his business(es) bankrupted, and he somehow came out swinging shortly thereafter and re-built an empire that dwarfed his previous one.

And if you’re a stubborn entrepreneurial type, you’ll want the option of creating a whole new concept, writing up the plan, and getting back out there. That’s really hard to do if you’ve compromised your personal assets and credit the first time around.

As I often share with my consulting clients, young employees (i.e. college kids) often have a LOT of energy and charm; this is great for retail stores. Offering incentives or commission is a good way to keep them motivated. Also, getting them involved in some of your marketing or product merchandising gets them feeling like they are actually contributing to the overall business (and they are! How’s that for win-win?)

As an example, I usually give each employee a “turn” to do the main window display once a month. I give them total flexibility to do whatever they want with it. Most of them are so creative that I am happy with their performance virtually every time. But more importantly, to them, it’s a chance to show their creative side and take an active role in building our business (notice the word “our” and not “mine”…) That’s because I always emphasize to my employees that we are a team, and we can all benefit from having a truly successful business. Basically, it creates a kind of “pride of ownership”, and with compensation that is, at least partially, tied to performance as mentioned above, each employee arguably does “own” a partial share in the business.

Questions? Comments? Please feel free to express yourself by adding a comment.

Suni here introducing our new blog, focused on retail consulting, and our ebook “How to Open a Unique Boutique”. We hope you like our ebook and if you have any questions, feel free to come back and post a comment for us.

One question we get get alot here, after reading our ebook, is how you know when you are ready to start a boutique. In my opinion, there is never a time when you are completely ready. You have to be willing to learn as you go and always be willing to adapt to situations. The most important thing is that you did your research and you have a business (and financial) plan. You don’t have to be rich – but you need to be organized and smart about how you use your resources.

You will learn many ways to do things once you get going and you have to be willing to adapt too. Speaking of new situations, my husband and I are now looking into a new retail venture. Our new concept is based on the Italian theme, but focused on interiors and Italian designer home furnishings.

We are truly excited and can’t wait to get started! We think there is a LOT of potential for this niche.

Again, welcome to our new blog, and feel free to post comments and questions.