How to Start a Subscription Box Business
This is a guide on how to start a subscription box business. It entails all the necessary information and will help you determine if this is the right business for you.
A subscription box business involves delivering unique product packages to customers’ doorsteps quarterly, monthly or weekly.
Who is best suited for this business?
If you love to network and connect with customers in a niche market, you are on the right path.
What is a typical day like?
Order of business includes packing and shipping boxes, expanding supplier networks, performing a quality test on products, etc.
What is your target market?
This business is appealing to all ages, but millennials take the cake.
How do you make money?
Customers pay you for the box subscription. You get a profit by finding items whose price is less than the subscription box’s price.
Does this business have a growth potential?
This is an exploding industry. So, yes.
What experiences and skills will you need?
What costs should you expect?
One of your biggest challenges will be logistics. You need somewhere to store and pack the items.
What are the steps for starting?
Plan your business.
Create legal entities.
Register for taxes.
Create a bank account for the business.
Set up accounting.
Get the necessary licenses and permits.
Get insurance for the business.
Define your brand.
Establish a web presence.
Where can you find a mentor?
Contact a free business resource for quality mentorship.
Growing Your Business
How do you market and promote your subscription box business?
Before placing ads, establish your brand. Find a catchy theme and name for your box. Offer a free sample to social media celebrities and ask them to broadcast their experience. Market your service on all your social media platforms.
How to get return customers
Deliver quality offerings and your customers will come back with friends.
When and how to build a team
If you cannot pack and ship on your own, you may hire a few workers.
Federal licensing requirements
Your business should abide by all the regulations set by the federal government.
Local and State Requirements
Check your state requirements.
Personal asset protection
Do not mix your business and personal accounts. To protect yourself and your business, make sure you:
Have a separate business bank account.
Have a credit card solely for the business.
How much should you charge customers?
Most services charge anywhere from $5 to $200 per month. It all depends on your target market and how much they are willing to spend.
What are the common ongoing expenses?
There is the cost of shipping, packing and acquiring the products.
How much profit should you expect?
Target a profit margin of about 30% per box. You will need to work hard and be creative to find the perfect balance.
How to run a more profitable business
Free samples could help at first.