Gift Basket

Startup Costs: $2,000 - $10,000
Home Based: Can be operated from home.
Part Time: Can be operated part-time.
Franchises Available? Yes
Online Operation? Yes

THE BRIEF

If you're the type who goes nuts at holidays and birthdays, choosing special gifts and then dressing them up in creative packages, you'll get all wrapped up in a gift basket business. Coming up with a niche for your business is one way to set yourself apart. Gift baskets themed around romance, travel, new home or baby or even divorce baskets are sure to be popular. Look for unique items people wouldn't be able to find on their own, and make sure your baskets have a cohesive theme and eye-catching decorations.  

You can start part time, your startup costs are relatively low, and if you're a creative person who likes conjuring up unique themes and packaging and putting them all together, it's a lot of fun. In most states, you'll need a liquor license if you want to include wine or Champagne in your baskets, and you'll want a resale license so you can buy gifts and supplies at wholesale prices. You'll also want some craft tools and a large work area, like a spare bedroom or basement for storing your inventory. Startup costs, including your initial gift and supplies inventory, typically run in the low thousands. Annual sales for gift basket designers range from $20,000 for someone working part time to over $200,000 for an entrepreneur with a strong corporate clientele. Gift baskets sell for anywhere from $15 to $1,000 each — depending, of course, on what's inside.

ASK THE EXPERTS

Focus on the corporate market:

"When I started out, I targeted my offerings to individuals rather than to businesses, because that's who I already knew. But my intention from the beginning was to gradually shift my focus to the corporate market. That's because a company that uses your service regularly tends to place five or six gift-basket orders a month, whereas most individuals order only one or two times a year. In short, for the same amount of marketing and physical effort, you generally get a bigger return with the corporate market."

—Jo Masterson, former president of Mountainview Gift Baskets in Redmond, Wash., told Entrepreneur 

Don't forget to factor in your labor:

"Gift basket business owners often short-change themselves on labor when setting prices. Be sure you know how long it really takes you to assemble, package and deliver or ship a basket; put together several of varying complexity, and time yourself--don't estimate. Then figure out how much you want to earn for your labor, and add that to the cost of the basket."

—Entrepreneur guide to How to Start a Gift Basket Company

Make sure you digitize your inventory:

"Basically, I stored everything in my den and garage, and every so often I would count it all. I would think I had 20 baskets left, then I'd go to fill several orders and find I had only 14. That would put me in a pinch, especially in my busy seasons.

—Ruth Kelsey of Brittany's Balloons and Gifts told Entrepreneur