Aside from playing outside and enjoying sweets, what makes life exciting for kids (and kids at heart) is receiving toys as gifts. We cannot deny that it is always a pleasurable experience seeing children get excited over a new toy.
That is why an online toy store will always be a profitable business because parents always want to make their kids happy by buying new toys. Toy purchases are not only made during holidays but even on simple occasions! Giving kids toys when they behave well in school can also be a common activity for some parents. The economy may be inconsistent, but parents’ desire to make children happy will always stay the same.
Your Ultimate Guide to Starting an Online Toy Store
So, if you are considering operating your own toy store lately, you’re in the right direction. If you are worried about not having enough investment, fret no more. Starting it online will solve most of your financial problems and give you a smooth start. Using a dropshipping model for your online store may also be a practical and reliable choice to decrease the setup and overhead costs further.
Like any start-up, establishing an online toy store requires strategic planning and proper execution in marketing, operations, buying, management, and financial know-how. Definitely, investing in developing customer service skills is a great help, too!
With strategic moves, this article will help you remove the financial obstacles so that you can build a fool-proof business plan for your online toy store. After all, you can’t have a successful business without a well-detailed plan of action. Show this plan to any potential investors for a potential added boost.
Business Plan Basics for a Toy Store
What you’ll learn more about later on are the details of each business plan section, at least in the realm of an online toy store. To prepare for that, you’ll need to ask yourself these basic questions:
- Do I have a clear target market?
- Can I make a personalized plan based on my market?
- How am I going to make money?
These are the basics of what anyone reading your business plan will need to know. Your readers could be potential investors or buyers down the line, so you’ll need to make sure you can answer “yes” to each question above. If you feel like you’re on the right track, keep reading onwards for a more detailed plan!
Of course, always gear up with passion and dedication. As soon as your online toy store becomes operational, it will definitely require your attention and energy. So to boost you in the initial stages, here’s a step-by-step guide to developing a solid startup business plan for your online toy store. Let’s go!
Step 1: Research the Market
First and foremost, you need to find out what types of toys are popular and trendy for children from different age groups. It is equally important to know the perspective of parents too since they will be the actual buyers. You can strike a balance by considering toys that are fun to play with and, at the same time, educational and eco-friendly. These characteristics will always make a great choice!
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You may also want to research more into educational and developmental toys for kids with learning differences, i.e., Autism, ADHD, etc. Advocating that every child deserves quality toys can motivate your buyers to purchase your products.
Step 2: Identify the Target Market
Decide carefully if you would focus your business on a local community only or you prefer to expand nationwide. Do not forget to consider essential factors, such as delivery options, income groups, etc. These factors contribute significantly to determining the profit margin and operating expenses.
Step 3: Get the Legal Stuff Done
Now that you have established your target market and the types of toys you will venture into. The next step is to get your business name registered and fulfill the legal requirements set by your local regulatory authority.
Fortunately, in most countries, legal requirements for an eCommerce business are fairly less complex than that of a physical business. Another thing, doing the legwork yourself is a cost-effective option. However, you may be required to hire for some support depending on your local laws’ demands.
Outsourcing legal work:
The legal part of a business plan is very difficult if you aren’t already someone with a law background. There are many sites out there where you can pay a lawyer an hourly wage to help you form this section of your plan. Consider a site like Upwork for this, or you could reach out directly through a lawyer’s website. Make sure that whoever you hire has sufficient credentials, and preferably a demonstrated history working on corporate affairs like this!
Step 4: Find the (Best) Suppliers
After doing the paperwork, it’s now time to face the most challenging online toy business aspect: finding the best supplier. Working with suppliers with unique and valuable toy products will be a more attractive option for kids and parents than an ordinary design. An example would be this C shape surfing baby scooter by Fascol.
You may also put a supplier with a variety of unique stuff on your list and those who offer drop shipping. They will not just help you lessen logistical expenses but will definitely save you time and energy!
“Clear” communication is also key in this business. It is critical to connect with the supplier and clarify every detail about your business with them. Do not presume everything. Make sure that you also meet each other halfway when it comes to finalizing terms and conditions, even up to the tiniest detail. It will enrich your relationship with your supplier and save you from false expectations and costs in the long run.
Step 5: Plan & Document the Financials
After identifying reliable suppliers and establishing connections with them, plan a budget for your toy store business. Analyze carefully how much money is required to get started. Calculate the differences between what you have in hand and how much you need to borrow. Bear in mind the expenses that you will incur on website maintenance, marketing materials, hiring staff, purchasing inventory and supplies, and insurance, etc.
A one-page business plan can be a good start to get your small scale online toy store operational and fully functional. Review if it clearly outlines your business objectives, strategies, and an action plan.
Moreover, it takes time for business plan preparation. Several experts recommend hiring a writer for a business plan, but only when you need a business plan to draw investors do you need to do this.
Step 6: Launch your Action Plan
Once you already have a clear forecast, that’s the time to get into action! Get started on developing a website and follow it by taking your online store live. Various free platforms allow you to make a quick website, but you also have to build your own. Developing a website at a later stage of the business, especially when it is already expanding, can be really complicated; thus, the best way is to get it done right from the beginning.
Actually, you don’t even need products to be physically available to start marketing. You may start by choosing ones for dropshipping. It would be best to focus your time and energy more on marketing and sales.
Hence, the action plan should focus on:
- Creating brand awareness through Social Media.
- Driving and increasing website traffic.
- Conversion Optimization.
- Brand engagement on Social Media.
- Improving customer service.
Since it’s an online business, optimize the use of social media platforms, email lists, banners on community websites, and pay per click advertising. But do not underestimate the power of offline marketing that can amplify your online presence.
Wrapping it up!
With the 6 steps in mind, you are ready to create an online toy store business plan. If you document everything in an engaging presentation, your online toy store business plan will be ready.
A business plan is a plus when you look for investment, but it never ensures that investors fund your startup. But one thing is for sure: business plans keep you on track to operate so your business can succeed. Planning is the mother of success, and failure to do so may bring you otherwise.
So, start working on your action plan, and as your marketing efforts take into place, you will start receiving customers. Do your very best to give 100% customer satisfaction to your first customers so they can give you positive feedback. Their testimonies can affect the number of customers you’ll have in the future. It may also be a good promotion to reward referrals with some % off or a gift or vouchers.
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We hope that this article gave you a clear-cut idea of how to write your online toy store business plan. A business plan is one key step in running a successful business, and investors will need to see it eventually. So, go out there and write that winning plan! We wish you the best of luck in your endeavors.
If you have any questions or concerns about the content of this article, feel free to post them in the comments below. We’ll get back to you as soon as we can. In the meantime, thanks for reading, and we’ll see you next week!