How to Start a Phone Case Business

The majority of people have cell phones these days, and they need to protect their cell phone investment with a phone case. People also like to have phone cases that sport designs as a fashion statement. If you have an eye for design and trends, you could start your own phone case business and become part of a $20 billion market.  

In this guide, you’ll find everything you need to know to start a successful phone case business.

Know Your Market

First, you’ll need to understand your market. Here are some interesting facts.

Clearly, the market for phone cases is huge and growing, so a phone case business with appealing designs has much potential.

Sourcing Phone Cases

First, you’ll need to decide where to get the phone cases that you’ll sell. The lowest-cost way to get your business started is to invest in a phone case-making kit or a heat press and design and manufacture your own. Your cost would likely be only a few hundred dollars. 

Alternatively, you could partner with a white-label manufacturer to produce your designs, and then sell them under your own brand. You’ll spend more money, probably several thousand dollars, by going this route, because you’ll likely have to order a minimum quantity of inventory. However, you’ll be able to get larger quantities of phone cases to sell faster.

If you make them yourself, you’ll spend much of your time producing the cases instead of marketing your business.

Sales Channels

Next, you need to determine where you’ll sell your phone cases. The obvious and least expensive choice is to sell online, which you could do on sites like Amazon or Etsy, or from your own website. However, e-commerce is clearly a highly competitive business, and phone cases are a competitive industry in general. To get your phone cases noticed, you’ll have to spend some marketing dollars. But the exceptional thing about selling online is that you’ll have a global market. Using designed printed labels ensures that you leave a lasting impression and guarantee that you will be remembered.

Another option is to set up a mall kiosk. You’ll pay rent, reducing your profit margin, but you’re likely to sell more. A phone case can be an easy impulse purchase for many of the people you’ll have walked by every day. A kiosk is a much less expensive option than opening a whole store and you’ll reach more customers since people will see your products as they go through the mall. 

You could also do both – a kiosk and an online store. You’ll be busy, but also maximizing your sales potential. 

Create a Business Plan

Once you’ve decided on the basics, you’ll need to write a business plan that outlines your business strategy.  Writing a business plan is a learning exercise, as well as a necessity, because it will involve research and analysis of every aspect of your business. The process will help you to define your strategy. 

A business plan should include the following:

  • Executive Summary – A one to two page summary of the key highlights of your business plan
  • Business Overview –  A summary of your business and your mission and vision
  • Products – A description of your products, sourcing, pricing, and value proposition
  • Market Analysis – Market statistics and trends
  • Competitor Analysis – Your main competitors, their strengths and weaknesses, and your plan to create a competitive advantage
  • Marketing and Sales Strategy – How you’ll get the word out about your business, and your sales channels
  • Operations Plan – How you’ll manage the business on a day-to-day basis
  • Management and Personnel Summary – Who will manage the business and your hiring plans, if any
  • Financials – Revenue and cost projections for at least 3 years, balance sheet projections, cash flow projections

If your plan is to obtain financing for your phone case business, all of the above sections are essential.

Register Your Business

You’ll need to determine what type of business entity to form and register with your state. If you don’t form a business entity and you’re going it alone, you’ll be operating as a sole proprietorship. With a sole proprietorship, or a partnership if you’re going into business with a partner, you and the business are considered a single entity. That makes you personally liable for the debts of the business, thus if the business cannot pay those debts, you are responsible.

Your other options are to register with your state as a either corporation or a limited liability company (LLC). Corporations are complicated and are subject to corporate taxes, so most entrepreneurs choose to form an LLC.

An LLC is considered a separateand distinct legal entity from its owners, and therefore has its own debts. That means that owners are not personally liable for the obligations of the business, which protects your personal assets if debts cannot be paid, or the business is sued. 

An LLC also offers pass-through taxation, which means the LLC is not taxed. Profits instead pass through to the owners to be taxed at their personal tax rates. 

Forming an LLC requires filing a document with the state, which in most states can be done online on the Secretary of State’s website. A fee is involved that ranges from $40 to $500 depending on the state.

Get an EIN

Suppose your business has multiple owners or will have employees. In that case, you’re required to apply for an Employer Identification Number (EIN) which is similar to a social security number for your business. You may also need your EIN to open a bank account. You can obtain one for free on the IRS website

Obtain Business Insurance

You’ll want to protect your business investment by obtaining business insurance. Talk to your current insurance agent about the kinds of insurance that may be best for your business.

Licenses and Permits

Check with your state and local governments for licenses and permits that are required for your business. You’re likely to at least need a sales tax permit.

Open a Business Bank Account

Keeping your business and personal finances completely separate will simplify your accounting and taxes. Most banks offer business bank accounts, so check with your personal bank for options.

In Closing

Now you’re ready to put your marketing strategy into action and make some sales! But be sure you follow all the steps in the process first to get your new business off on the right foot. It may be a good idea to consult with an attorney and tax advisor when making decisions, like the type of business entity to form, so that everything goes smoothly, and you can focus on growing your successful phone case business!

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