In this article we will hit topics on licenses, taxes, where you can find boutique wholesale clothing and more.
THE POWER OF THE SMALL BOUTIQUE (INTRO)
Have you walked into a local big box store and thought, there is no chance my boutique can compete with this? Think again because the boutique industry thrives for a reason, let’s explore three competitive advantages you have over everyone else!
Tens of thousands of boutiques collectively purchase from a group of vendors and suppliers that strictly supply boutiques. These boutique niche suppliers are able to utilize bulk manufacturing to achieve low prices that closely rival big box stores.
The moment a new fashion trend comes off the table it can be expedited to your boutique shop within days. Unlike big box stores who do their purchasing months in advance, boutiques purchase week to week, allowing them to stay on top of the trends.
We help each other! Ross, TJMaxx and Target keep their competitive data to themselves, but you will find in the boutique industry a ton of women will be glad to mentor and tell you secrets to their success.
THREE PLACES TO BUY WHOLESALE CLOTHING FOR YOU BOUTIQUE
1. Fashion Events
Fashion events offer the traditional method of buying for your boutique store. Visit booths, walk around, talk to a bunch of people (vendors and boutique owners) and leave with both clothing and valuable information to take back with you.
The Magic Show is held in Las Vegas and is purported to be the biggest boutique clothing show in the country. Looking for a steal deal? Then also head over to the Off Price Show which also takes place in Las Vegas at around the same time.
Fashion boutique events are held all around the country at cities like Las Vegas, Dallas, Miami and Atlanta. For the complete list of nationwide events visit our Fashion Events page.
2. Online Sites
If you haven’t already, please start with my boutique supplier list and top 5 vendor list, from there you can google wholesale clothing suppliers and begin a more extensive search.
Finding suppliers isn’t the hard part, it’s who to choose (we’ll go over that in a bit.)
Online sites provide incredible tools for the boutique owner including:
Access to every imaginable USA vendor.
“Trend Tracking” allows you to know the current and upcoming trends that your customers will love.
Short delivery times makes it easy to stock up.
Keeping track of all your orders is a neat and efficient when you shop online.
3. Los Angeles Fashion District
Another fantastic option is taking a trip to the Los Angeles Fashion District. It contains all of the top boutique distributors in the country all in one block.
Visiting LA is a great way to stock up with the latest boutique trends and get an intimate relationship and inside look with the vendors you work with.
Like shows, visiting the LA fashion district will give you the opportunity to feel the quality of the clothing and see the fit. Pictures from a website don’t always correctly suggest how the items will fit your boutique customers.
Before you arrive, try to get direct appointments with vendors to ensure you meet with the manager or owner of the label.
ANY TRICK IN SELECTING A WHOLESALER?
Not really, some are more on top of shipping times (this can be important during Christmas, Valentines, etc.) but you will find that each supplier caters to different geographic boutique trends within the USA.
This is the beauty of the industry, each boutique vendor tailors a unique and specific look to certain parts of the country. Whether it be coastal, junior, mid west or deep south looks, you can easily find 3-4 great suppliers that will provide your boutique with more than enough selection.
WHAT LICENSES DO I NEED?
Usually just two, a sellers permit and a business license. Visit these two sites (SBA and Legalzoom) to learn more.
Every state is unique in how you acquire these licenses so my advice is to google search terms like: (“your state” business license registration and sellers permit.)
It’s best to get on the phone with someone and have them walk you through the steps required to get these licenses for your boutique business.
WHAT TAXES DO I PAY?
In general the government only takes taxes from transactions that result in a profit. Since you are not yet making a profit with your purchase of wholesale items, you will not pay taxes on the purchases with boutique vendors.
For you, there are two to three taxes you will pay: Sales tax, state tax and federal tax. Your customers pay sales tax when they purchase clothing from you, which you will hold onto and forfeit to the IRS come tax time.
Taxes out of your pocket will be for state and federal (unless your state has no taxes) and they will be determined on the profit you make. These taxes will be from the profits you make on sales transactions between you and your boutique customers.
Tip: Keep your profit’s low
If you have a successful boutique and stand to make a lot of profit, rather then shed 30-40% of it away to the IRS at the end of the year you can invest that money to help you grow larger.
You can rack up good “return on investment (ROI)” expenses like building a website, purchasing new computers and equipment, hire more talented people that can expand your store(s), and increase your marketing spending.
Of course you don’t want to have more expenses just to avoid paying taxes but you do want to take advantage of any “loop holes” available to you.
ONLINE OR IN PERSON BUYING?
Online ordering gives you the ability to stay on top of the boutique trends and makes the ordering process seamless. Also your access to clothing and new potential boutique vendors is larger.
With that said, there still is a necessity for boutiques to visit trade shows and meet with suppliers and other boutique owners. Events like the Magic Show by UBM and the Off Price Show in Vegas for example are rich with information that one is unable to garner online.
So the answer, if you can, is do both!