Start a Gift Basket Business
The gift basket business is one of the fastest growing home businesses in North America.
In this business, the more creative you are, the more you prosper.
Space: The ideal place to start your gift basket service business is your home. It allows you
to start your business with a small amount of capital, save commuting expenses and operate part-time
or full-time. However, to operate from home you need a decent sized room with display facility.
If your home is not suitable for this business, you may rent or lease a separate location, which
may be costly. When doing so, you should look for a location that is in a high traffic area, and has
parking facility. It should have enough inventory storage capacity and a customer friendly layout so
that customers can easily view all products without tripping or squeezing themselves through narrow
corridors.
Inventory: The items for gift basket service business may be purchased through both wholesale and
retail channels. The items that should be bought through wholesale channels are baskets, 'filler' items
such as tissue paper, brown paper, string, tape etc.
You may also build your inventory by:
- Attending gift shows to get crafts and 'hard to find' gifts
- Joining supplier mailing lists
- Buying your items in bulk thus getting quantity discounts
However, initially you must limit your inventory to a manageable level. It is bad business practice
to block capital.
Skills: You can run your business on your own but may need to hire employees in the peak season, like
Christmas, when the orders are more than you can handle alone. Thus you need to know how to recruit,
interview, motivate, train and develop personnel. With this, you should also be familiar with skills
like bookkeeping, purchasing and advertising basics.
Product: Some of the standard baskets that you may offer are:
- Gourmet/Food Baskets: These are great gifts for friends and families. They can be thematic like
chocolate baskets, wine and cheese baskets, etc.
- Toiletry Baskets: These can include items such as oils, lotions, scented soaps, fragrances, etc.
When making such a basket please make sure that these supplies should last a family for a month.
- Shower Baskets: These are perfect gifts for wedding and baby showers, and are usually stocked with a
variety of every day necessities.
- Customized Baskets: These are baskets that are packed with items selected by customers. They are
more expensive as you have to create a made-to-order basket so the price should be negotiated with
the customer before you begin your shopping.
Pricing: You need to consider the following factors while pricing your baskets:
- The labour, materials and time required by you to assemble the basket
- The cost of merchandise in the basket
- The delivery charges for delivering the basket to its destination.
- The overhead operating expenses associated with your location and business.
- The profit percentage you want to earn from each basket.
- Your competitor's price so that you can price your own baskets competitively.
Advertising and promotion: While word of mouth publicity based on customer satisfaction can make or break
your gift basket service business you should also adopt other advertising methods to reach out to new customers.
Newspaper advertisements and direct mail may be a good help to:
- Convince customers that your baskets are the best.
- Enhance your company's image.
- Create a desire and draw customers to your service.
You can also put up colorful fliers in shopping malls, grocery stores etc. Yellow pages and targeted online
advertising can also be considered to increase customer awareness.
Tools of the trade: You will need to have regular office equipment, shrink-wrap equipment for sealing fresh
food items and a company vehicle for custom shopping, and deliveries of your baskets.
COURSES ON STARTING A GIFT BASKET BUSINESS:
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