According to the latest data, the gifting industry has been seeing consistent growth levels of 5%. This has created an industry value of an estimated $3 billion.
It’s Christmas. It’s your best friend’s wedding. It’s Mother’s day.
With so many celebrations and occasions in each of our lifetime, starting a gift basket business is a pretty straightforward and one of the quickest side hustle to setup.
Many people overlook this easy to start home-based business that you can start with little startup cost. All you need is a bit of creativity. Here are 5 steps you need to figure before getting into the lucrative world of gifting.
1. What’s your niche?
Like most businesses, finding a niche helps differentiate your business from the competition. A niche targets a specific audience or fills a specific need. The narrower your market is, the easier it will be for your gift baskets to become the go-to solution for that audience.
A quick search for “gift baskets” on Amazon returns over 50,000 results in over 24 categories from gourmet foods to handmade pet supplies. Knowing which market you want to get into will get you to success faster as it helps distinguish your brand from competitors.
Here are three steps for finding your niche:
List your interests: Starting your gift basket around something you are genuinely passionate about will help keep the business exciting. As the owner, you will be spending tons of time on your business, so building it around one of your interests will help keep you engaged.
Determine the audience potential: If you’re opening a storefront, make sure your gift basket has a lot of local interest. For online businesses, use tools like Google AdWords or Google Trends to see how many people are searching for the kinds of products you want to offer.
Research the potential profits: Once you have an idea and have verified customer interest, make sure the idea is profitable.
2. Who are your customers?
People who buy gift baskets belong to the middle-upper class with money to shell out. This is good and it’s also important to consider this when you plan where to sell. Another sub-class of customers are business or corporate buyers – this happens to be where a large portion of where my sales comes from. Businesses often buy gift baskets as holiday presents for clients and employees, to celebrate employee milestones, and other major life events.
3. Where should you start?
If you are not ready to devote 100% of your time to running the shop, selling from home or online is your best option. The startup costs are much lower than opening a brick-and-mortar storefront, and you’ll have more flexibility. Plus, if you are shipping nationwide, having an online business provides a much larger customer base.
Regardless of the size of your online gift basket business, you will need an e-commerce platform to build your website and manage orders. Shopify is an affordable and sophisticated e-commerce platform that also has built-in payment processing, inventory management tools, shipping discounts, marketing features, and more. Visit Shopify or Bigcommerce for a free trial.
4. Sourcing for Products
At first glance, the easiest way to buy products for your gift basket may be to run to the nearest box store. But, in order to get the best profit margins on your baskets, you should purchase your basket products at wholesale rates. Wholesale prices are typically 50% of standard retail prices, sometimes even less.
There are several ways to source wholesale products, including:
- Using an online directory: There are several websites that gather many different wholesale suppliers in one place so you can order many kinds of products at once.
- Attending a merchandise trade show: Shop for wholesale products at a regional or national merchandise trade show. You can see the products for yourself before purchasing, and there are typically great deals if you buy at the show. Plus, most retail trade shows have complimentary educational seminars on different marketing and management topics.
- Purchasing directly from a wholesale distributor: Once you find a supplier you are happy with, purchasing directly from them will usually offer the best pricing. Some POS systems, like Lightspeed, have built-in product catalogs so you can order wholesale products directly from your POS.
5. Advertise Your Gift Basket Business
Once you have your products and online store all set, it’s time to start advertising. The best advertising strategies will combine both online and traditional marketing tactics to reach the largest number of customers.
This is often the most cost-effective way of reaching a large group of people. If you’re selling baskets online, digital advertising is a must. For this you need a website. They should feature the different types of gift baskets you offer, an “About Us” section, contact information, and store location and hours.
Using a low-cost web builder like WordPress and hosting service like Bluehost is the easiest way to get started. Bluehost has plans that let you register your domain name, host your website, access a WordPress web builder, and get a business email address for just $3.95 per month.
Getting to the next level
Starting a gift basket business requires a creative idea and lots of careful planning. You’ll need to find a profitable niche, choose a sales channel, and write out a detailed business plan. But having the right tools and training material will make your job easier, that’s why we recommend picking up Sherry Miller’s Gift Basket Insider report
The truth is, there are some really amazing little tricks that are kept under lock & key by the worlds richest gift basket professionals, and for good reason… they don’t want their secrets to get out!
But now you don’t have to wade through mountains of useless information in order to find the real nuggets. Becoming a successful gift basket creator is really simple, if you just follow the easy plan that Sherry’s clearly laid out for you in her report. You’ll learn what to do first, and what never to do (and certainly everything in between)!