How Much Money Can I Make Owning a Clothes Boutique?

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Boutiques often serve high-end or niche customers, so the amount of money you can make as an owner depends in part on the prevailing economic climate and consumer confidence. Your earnings also are impacted by competition with big clothing retailers and e-commerce outlets.

TL;DR (Too Long; Didn't Read)

In 2018 the average retail store owner is set to make around $51,000 per year, with a range of $23,751 to $140,935 depending on location and on variables.

U.S. Retail Clothing Industry

According to Sageworks, a data analysis company, net profit margins for U.S. privately-held clothing stores was 7 percent as of 2013. These figures were based on aggregated financial statements of clothing stores gathered from banks, credit unions and accounting companies. PayScale notes that for 2018 the average retail store owner is set to make around $51,000 per year, with a range of $23,751 to $140,935 depending on location and on variables.

Consignment clothing stores buy used clothes and/or share profits with consignors who sell their used clothing through the store. The business has been called "recession proof," since the merchandise is already created and does not have production costs. The Chron small business focus website notes that the annual average salary of a consignment store owner is around $52,000.

Boutique Owner and Manager Salary

As owner, you will either run the store yourself or hire a manager to run the business for you. Take this into consideration when calculating how much you can make owning a clothes boutique. Industry salary resource Salary Explorer reports that the average monthly salary for a retail store manager is approximately $4,040 per month as of 2018. Career portal Glassdoor quotes $39,140 as the national average annual salary for a boutique manager in 2018, with PayScale noting the range is $26,058 to $69,201 a year for 2018. If you are your own store manager, this is the likely salary you can pay yourself. Sales associates who assist you make a national average of $9.68 an hour (at a range of $7 to $13 an hour). One or two associates will be needed for your business, so keep their salary in mind when you calculate your income.

Store Profit Per Square Foot

Experts note that the key to profitability for clothing stores is the ratio of sales per square foot to rent per square foot. The size of the store is not proportionate to sales.

Retail consultants Karl Stark and Bill Stewart from the Avondale company found that when comparing boutiques in New York and Los Angeles, the West Coast store had a sales/rent ratio one-third that of the New York venue. Despite being three times larger than the New York store, the Los Angeles store made roughly the same in sales. As a result, the more efficient New York boutique was profitable, whereas the Los Angeles boutique was not.

Whether you already own a boutique or plan to expand to new stores, you can take several steps to ensure your store's size is not a deterrent to its profit potential. Stark and Stewart recommend estimating total demand and total sales based on the local market. Determine the rental rates of your local market, then from that obtain the maximum boutique square footage for that locality.