How to Start a Retail Clothing Store

Although the economic outlook for retail sales is shaky, you can successfully start a clothing store. Find a niche, such as clothing for the full-figured woman or elegant menswear to set your store apart from others. Choose a location in a high-traffic area to attract browsers and turn them into buyers. With a lot of planning and a little luck, you can own and operate a retail clothing business.

Develop your idea by writing a business plan, which details the store concept, strategy, competition, financial outlook and marketing ideas. Outline your concept down to the tiniest detail. What will you focus on -- menswear, women's clothing, prom and formal event clothing, accessories, children's clothing, hand-made clothing, modest clothing, hip-hop clothing? Scour the internet for estimates of market size and share. Look around your community to see who else may be running a store similar to the one you want to open.

Consult an attorney to incorporate your business, obtain a tax ID number and register your business name. You'll need a tax ID number to purchase clothing for resale. Your attorney can advise you on the best corporate structure for your situation. Business structures include sole proprietorships, limited-liability corporations (LLC), and S and C corporations. Each has unique financial and legal ramifications. Find a business attorney, schedule an appointment and discuss your situation with him or her to find the best match.

Search for a great location for your store as it will receive a lot of walk-by and drive-by traffic. Realtors can provide you with estimates on traffic patterns near your store location. Be sure to check convenience factors, too, such as handicap access and parking. Many business fail because parking is a nightmare for their customers. If the store was already a clothing store, make careful inquiries about the previous tenants. Did the business move, close, or go bankrupt? If they went out of business, why?

Purchase retail fittings for the store. These may include special lighting to highlight your products, display cases, clothing racks, counters, cash registers, telephones, credit card terminals, carpet, dressing rooms, shopping bags and gift wrap. Look for retail-fittings companies online or for local auctions. Many stores that are going out of business sell their fittings very inexpensively, and you can often paint racks into interesting colors to jazz up your store.

Decorate your store with your customer in mind. If you're catering to trendy teens, your decor will be different than someone targeting affluent, middle-aged customers looking for executive attire. Choose carpet and paint colors accordingly.

Establish credit accounts with wholesale clothing vendors. Find wholesale clothing vendors online or at the major apparel centers in New York City, Atlanta, Chicago and Los Angeles. Shop in person at major clothing centers. In New York City, the Garment District occupies several blocks in the West 30s. When visiting wholesalers in person, you'll need your sales tax ID paperwork, business cards, photo identification and credit references to establish trade accounts. Some wholesalers accept credit cards. The wholesale company will check your identification and paperwork to ensure that you represent a legitimate retail business and aren't just bargain shopping. Once approved, you'll be able to place your orders. Most wholesalers require a minimum purchase of at least $100.

Prepare for your opening day by creating a simple, effective Website. Consider eBay stores and a shopping Website in addition to your physical location to supplement sales. Promote your new business by issuing a press release to local media, ads in newspapers and fliers. Advertising is the key for any new businesses, so plan to invest in local advertising to drive traffic to your store.

Most small-business owners do the majority of the work themselves instead of hiring help. Hiring staff increases costs dramatically, both in salary and taxes. If you need to hire someone, look for part-time help well in advance of your opening day. Make sure that you provide them with adequate training on how to run the cash register, store policies and regulations, and information on the merchandise.


  • Always have double the amount of cash or credit available that you think you'll need. Invest in advertising to get customers to your store. Consult the Small Business Administration for advice on starting a business.