How to Open a Gift Shop ?

Would you like to open a gift shop? Here are the details of the news…

You must have visited a gift shop before, I guess. If I didn’t guess right, maybe I can change the way I put it. You must have given out a gift before. Peradventure, I still didn’t guess right. Let me say that you must have received a gift before.  Can you estimate the number of people that buy gifts in your locality per week? You may not know how to estimate this until you visit a nearby gift boutique or attend a birthday or wedding ceremony and observe the gifts being presented to the celebrant. What am I saying in essence? I am trying to direct your attention to the viability of starting a gift shop.  Gift shops are very diverse both in size and what they sell. You can start a gift shop as a small shop. You can also start your gift shop as a large store. You can decide to sell a large variety of gift items. You can also decide to focus on a particular gift theme such as traditional gift items, card gifts, toys or special crafted gifts. Focusing on a particular item may limit your market potential. At the same time, it can make you to stand out by creating a niche for yourself. Below is the list of few gift items you can decide to sell:

  • Seasonal decorations
  • Clothing & Jewellery
  • Souvenirs and novelty items
  • Groceries
  • Greeting Cards
  • Kitchenware and home furnishings

If you are seeking for ideas for starting a gift shop, visiting existing gift shops around will help you locate which line of gift business will be good to start. However, you need to expand your horizon. You need to think outside the box. It is possible that there are opportunities which the existing gift shops are yet to explore. How can you know this? You need to conduct market research to determine what the customers like or may like if introduced to them. If you are planning starting a gift boutique you should be able to visit other gift shops that are not even located within your coverage. Conduct research on the internet to see what are trending. This will give you a clue of what you can possibly sell as a gift shop owner.

Having located good ideas for starting a gift shop, you need to decide on the one that will enjoy patronage. If the market is not large enough, you may need to conduct further research until you find the right one(s). Gift items that attract high demands are good ideas for starting a gift shop.

Choose a business name

The next thing is to choose a name for your gift shop. The name should entice customers and should suggest that it is actually a gift boutique. Before you finally settle for a name, you need to conduct a search for the availability of the name. It is possible that someone has already registered the name or the name is too similar to an existing name. When you ascertain the availability of the name, it is important that you register the name immediately. You can register it as a sole proprietorship. This will reduce your business name registration costs.

Prepare a business plan

You can then write a business plan for your gift shop. This should cover all aspects of your gift boutique ranging from funds requirements, management, target customers, operations, sales and marketing, financial projections etc.


The location of your gift boutique is very important. You should locate the gift shop at a place that is easily accessible to customers. The place should be spacious enough to allow stocking and display of gift items. Most importantly, the security level of the location of the gift shop has to be taken into consideration. Your gift shop or gift boutique should be located in a safe environment. Although getting a spacious place is good but the cost should not be too much for the size of the gift items in your gift shop. The gift shop should not be too large. Also, you need to consider future expansion of the gift shop.

Source for fund

You can then source for funds to kick start your gift shop. Cost of starting a shop gift will be influenced by the gift items you sell and the location of your gift boutique. However, I don’t expect that you depend on bank loans to start a gift shop. This can be too risky. You can start your gift shop small to gain experience. As your gift shop business grows, it will be easier to approach bank for additional funding especially during Christmas time when you can easily turnover the gift items and pay back the loan.


I need to stress the importance of marketing when it comes to gift items business. If you know the volume of searches people conduct on the internet everyday looking for gift shops or gift items, you will not hesitate to try online advertisement. Having a website for your gift shop is equally important. Good graphics and images of the gift items you sell can influence customer buying decision. It will be nice if customers can place order from your website. The mode of payment should be made easy for your customers.

SWOT Analysis for Gift Shop

Whether you want to start a gift shop or you have already started your own, this SWOT Analysis for gift shop below will help you considerably in planning and charting direction for your own gift shop.


  • Experienced in retails
  • E commerce website
  • Effective delivery
  • Blog on gift ideas
  • Strong Capital Base
  • Variety of high quality gift items
  • Propriety products
  • Good location
  • Customer loyalty
  • Good branch network

  • Sales is seasonal
  • Poor location
  • Poor marketing
  • High costs
  • Narrow niche market
  • Obsolete stocks
  • Declining margin



  • More cheaper online payment options
  • Large population
  • More companies embracing corporate gifts

  • Competitors
  • Online greeting cards
  • High interest rate
  • Threat of substitutes


Retails experience: Gift shop is all about retailing. If you want to start a gift shop, you need to have developed skills in retailing. Of course, your retailing experience may not necessarily relate to operating a gift shop. Retailing skill is transferable. But it is important that you have that experience. It will help you in inventory management and good arrangement of your store fronts.

ECommerce website: Having a website for your gift shop will add credibility to your business. While ordinary and simple website may be okay for some businesses, having an eCommerce website for your gift shop will increase your revenue generating potential. With eCommerce website, customers can easily place order from your website right from the comfort of their home.

Effective Delivery: When people buy gift items online from your eCommerce website, they expect that the items should be delivered promptly and in good order. If you have effective and reliable delivery system in place, people will be confident that each time they buy from you, they will always receive their gift items on time.

Blog: People are searching internet for information on gift items that are suitable for events and situations. If you can maintain a blog on your website advising your potential customers on the appropriateness of each gift items, this will draft traffic to your site. If your articles are educative enough, people will be ready to share them on social media. This will be a free advertisement for your gift shop. You can easily convert your readers into customers.

Strong capital base: For you to be able to compete with the big online gift shops, you need to have enough capital. Big online gift shops spend huge money on advertisements but if you have enough capital you can invest on advertisement too, you can be sure that you will get returns on your investment.

Variety of high quality gift items: If your gift shop can stock or offer customers variety of high quality gift items, they will have options. It will not be the case of being forced to buy what is available. This can make your gift shop to stand out as one stop gift shop in your neighbourhood.

Propriety products: If your gift shop sells propriety or self-customized products which customers cannot get from any other place, this will be a major strength to you. With this, you will not only attract individuals to your gift shop, you will equally have corporate customers patronizing you.

Good location: Location plays an important role when it comes to operating a gift shop. Even if you run an eCommerce website, great number of your customers will like to come physically to your shop. Therefore, having your gift shop located where there are traffics of people with good parking lot will be a major advantage.

Customer loyalty: Even though gift shop business seems to be seasonal, if you enjoy customer loyalty, this can help you get sizeable revenue round the year. People will always celebrate birthdays and anniversaries. Imagine you having customers always coming to you for every event, your revenue will be stable through out the year.

Good branch network: Have a good number of branches is a good way of bring your gift shop closer to your customers. You will be able to capture more market share. Also, this can reduce your delivery costs to people that buy online. You can always ship from the branch that is closest to your customer’s location.


Sales are seasonal: To some extent, gift shop sales can be seasonal especially if you sell seasonal greeting cards. To overcome this, you may need to expand your services to cover other items that are not seasonal.

Poor location: Operating a gift shop requires a good location. If you are located in a poor area, you may need to find a better place. Otherwise, you should prepare to change the line of your business completely.

Poor marketing: If you don’t have money to invest in marketing like printing of brochure and online advertisements, your sales will be affected. However, locating your gift shop in a good place can help reduce the amount you may need to spend on marketing.

High costs: If you are unable to buy some of your gift items in bulk, you may discover that your costs are quite high compared to that of your competitors who can afford to buy in large quantities. Buying in small quantity means that you will not be able to enjoy quantity discounts. At the same time, you will spend more money on transportation. The implication of this is that your margin will be low. If the margin is too low, you may not be able to pay your overheads. This means that you will be running your gift shop at a loss.

Obsolete stocks: Lack of adequate patronage will result in obsolete stocks. In most cases, gift shops stock in anticipation of demand especially towards holidays and festive periods. If you are unable to sell all your stocks during these periods, some of them may become obsolete. Imagining stocking Christmas Cards for more than one year; even if the wordings are still relevant in the following year, the colour of the cards must have faded out.

Narrow niche market: In a bit to compete favourably, a gift shop may choose to create a niche for itself by focusing on a particular set of gift items. The danger is that, you may not have enough market for your product niche.


More online payment options: One of the challenges we have in the African countries is the lack of affordable online payment platforms. Now that we are beginning to have more of both local and international payment platforms, one can decide to have an ecommerce website for his gift shop.

Large population: Cities with large population provide an opportunity to have more customers. Even though the margin on gift items may be low, except where you are selling your own propriety or customized gift items that allow you to fix your own price, you can leverage on volume.

More companies embracing corporate gifts: It is fast becoming a norm for companies to appreciate their customers during special days like birthdays and festive periods. This is a big opportunity for people operating gift shops. For instance, we have many banks with branches spread across the country. The customer base of each bank runs into millions. Let’s assume that they want to buy gift items for just top five percent of their customers. The volume is going to be very huge.


Competitors: Competition involved in gift shop business is becoming too stiff. Big online retailers are making things difficult for smaller ones. They can afford to spend huge amount on advertisement. The fact that they buy in very large quantities makes their products to be cheaper. So, instead of corporate organizations to buy from a local gift shop, they can choose to place order online and buy directly from big online retailers who can afford to offer them attractive discounts.

Online greeting cards: Sales of greeting cards have reduced drastically because of different online greeting cards that one can even get free of charge and send online immediately.

High interest rate: With high interest rate, it is difficult for small gift shops to access credit facility from the bank. With high interest rate, they will have to be paying much to service their debts. This will ultimately erode the little margin they should have made on the sales of gift items.

Threat of substitutes: Before you start a gift shop, you need to be aware that there are many substitutes for gift items in the market. What you sell in your gift shop can easily be gotten elsewhere even in the open market. Besides, one is not under compulsion to buy a particular gift item. If a particular gift item seems to be too expensive, you can easily get another gift item elsewhere that will match your budget.

Threat of new entrants: There is no entry barrier to starting a gift shop. It is not regulated. This means that anybody can start it. In this type of situation, market can soon become saturated.




-See more:

Add a Comment

Your email address will not be published. Required fields are marked *