Do you want to start a sex toy shop? If YES, here is a complete guide to starting a sex toy shop business with NO money and no experience.
Okay, so we have provided you an in-depth sample sex toy shop business plan template. We also took it further by analyzing and drafting a sample sex toy shop marketing plan backed up by actionable guerrilla marketing ideas for sex toy shops. In this article, we will be considering all the requirements for starting a sex toy shop. So put on your entrepreneurial hat and let’s proceed.
Why Start a Sex Toy Shop?
It is becoming the norm for adults to freely walk into a sex toy and adult sex accessories shop to purchase sex toys of their choice without stress and harassment. This goes to show that the business is indeed a thriving business.
If you are looking for a business to start and you have interest in the adult stores industry, then you should consider starting your own sex toy store business. Although you don’t need a college degree to establish your own sex toy store, but you would need some form of informal training, you might have to work as an apprentice with someone who owns a sex toy shop or adult store. It makes it easier for you to learn how to manage your own shop when you get started.
Setting up a sex toy and adult sex accessories shop business can be profitable for someone who is skilled in the trade and who has business perseverance and smartness. With the right location, top-notch services and good marketing skills, you can serve varieties of customers that cut across individuals and corporate clients, celebrities and regular people.
It is important to point out that the sex toy store business is one business that can’t go out of fashion simply because of the role it plays in the society. Depending on the scale you want to start, the startup capital for this type of business is considered to be moderate. As a matter of fact, you can start your own sex toy and adult sex accessories store and then grow it big within a short period of time by re-investing your profits back to the business.
Before launching this type of business, it will pay you to carry out your market research, economic and cost analysis and of course feasibility studies. If you get these things right before launching your sex toy and adult sex accessories store business, it will not take you long before you break even and start smiling to the bank.
Starting a Sex Toy Shop Business – A Complete Guide
- Industry Overview
The adult store industry or sex shops include companies that primarily retail sexual paraphernalia or erotica, including pornographic DVDs, magazines, books, sex toys and enhancement products such as vibrators, rubber penises, lubrication, anal beads, penis rings, other sex paraphernalia. Stores that primarily sell movies are excluded from the industry. This industry does not include revenue from all goods sold off premises such as online, through mail-order catalogs or over the phone.
If you are a close observer of happenings in the adult stores industry, you will agree that the ever-increasing external competition from online and mainstream adult product retailers, which increasingly carry vibrators and other erotica, has pressured growth in the industry. In the last half decade, as consumers enjoyed the benefits of purchasing adult products online, which include anonymity, wider purchase selection and lower prices, industry revenue grew moderately.
So also, the prevalent acceptance of sex paraphernalia, evidenced by mainstream stores such as Walmart and CVS carrying some adult products and increased sexuality on TV, has helped boost demand for industry products. Going forward, the adult stores industry is expected to benefit from rising disposable income, which will increase spending on adult paraphernalia.
The Adult Stores Industry is indeed a large industry and pretty much active in developed countries such as Canada, United States of America, United Kingdom, Italy, France, Germany, Japan, China, Scotland, Switzerland et al. Statistics has it that in the United States of America alone, there are about 7,568 registered and licensed adult stores/sex shops scattered all across the United States responsible for directly employing about 37,663 people and the industry rakes in a whooping sum of $9 billion annually. The industry is projected to grow at 0.5 percent annually within 2011 and 2016.
A recent report published by IBISWorld shows that the geographical spread of the Adult Stores industry reflects the distribution of population. Generally, the higher the number of residents in a geographic region, the higher the demand will be for industry establishments in that area. In 2016, industry establishments are estimated to be concentrated in the Southeast, Great Lakes and West regions, which houses the most people.
The report further stated that the Southeast region is expected to account for the highest share of industry establishments, containing about 28.3 percent of industry establishments. This region accounts for the highest share of the population, over 25.0 percent. The Great Lakes region also holds a high level of establishments, accounting for about 15.9 percent of nationwide establishments; this region accounts for about 15.0 percent of the nation’s population.
The tough part as it relates to start-up costs are the need to establish a supply of sex toys and other similar products from wholesalers or directly from sex toys manufacturing companies. This is so because a sex toy shop business cannot be started without sourcing products to sale. Regardless of low barriers to entry, the competitive nature of the industry makes it very difficult for new operators to break even within a short period of time.
Lastly, the adult stores industry is pretty much open for aspiring entrepreneurs to launch their business in the industry. One good thing about the sex toy and adult sex accessories stores business is that the business can be opened in any part of the United States and if proper market survey and feasibility studies are conducted, then you can be rest assured of the profitability of the business.
Starting a Sex Toy Shop Business – Market Research and Feasibility Studies
- Demographics and Psychographics
The demographic and psychographic composition of those who patronize sex toy and adult sex accessories stores cut across all genders; male and female above 18 years with the financial means, hence the demographic composition for the sex toy and adult sex accessories store business is all encompassing. In essence, your target market can’t be restricted to just a group of people, but to all adults who reside in your target location and who have the purchasing power.
So, if you are thinking of opening your own sex toy and adult sex accessories shop business then you should make your target demographics all encompassing. It should include corporate executives, commercial sex workers, LGBT communities, students, migrants, entrepreneurs, business people, celebrities, public figures, military men and women, sports men and women, tourists, and every adult in the neighborhood where your sex toy and adult sex accessories shop will be located.
List of Niche ideas Within the Sex Toy Retail Business That You Can Specialize in
It is important to state that there is no known niche area when it comes to the sex toy and adult sex accessories store business. Every player in this line of business usually sell a wide range of sexual paraphernalia or erotica, including pornographic DVDs, magazines, sex toys and enhancement products such as vibrators, rubber penises, lubrication, anal beads, penis rings, other sex paraphernalia from top manufacturing brands in the United States and other countries of the world.
On the other hand, it is important to state that some sex toy shops or adult stores may decide to major in selling sex toys and games, selling sex enhancement products, selling and renting pornographic movies and selling pornographic magazines, calendars and other paraphernalia. So also, some sex toy stores may decide to build a strong online presence in the online community.
The Level of Competition in the Sex Toy Shops cum Adult Stores Industry
The competition that exists in the sex toy shops and adult stores industry goes beyond competition between sex toy stores; you will be expected to compete with any other outlet that is into selling sex toys and games, selling sex enhancement products, selling and renting pornographic movies, and selling pornographic magazines, calendars and other paraphernalia. So, it will be right to say the competition in the sex toys store business is tough.
The truth is that no matter the level of competition in an industry, if you brand and promote your products or business properly, you will always make headway in the industry. Just ensure you stock your store with sex paraphernalia or erotica, including pornographic DVDs and magazines and sex toys and enhancement products such as vibrators, rubber penises, lubrication, anal beads, penis rings, other sex paraphernalia from different manufacturing companies and you know how to attract and reach out to your target market.
But over and above, there are several sex toy shops cum adult stores scattered all around the United States. So, if you choose to start your own sex toys store business in the United States, you will definitely meet stiff competition amongst sex toy stores and any other outlets that are into selling sex toys and games, selling sex enhancement products, selling and renting pornographic movies, and selling pornographic magazines, calendars and other paraphernalia. Besides, there are larger sex toy shops/adult stores brand that determine the trends in the industry and you should be ready to compete with them for customers.
List of Well – Known Brands in the Sex Toy Retail Industry
In every industry, there are always brands who perform better or are better regarded by customers and the general public than others. Some of these brands are those that have been in the industry for a long time, while others are best known for how they conduct their businesses and the results they have achieved over the years.
These are some of the leading sex toy shops and adult stores in the United States of America and in the globe;
- Adam & Eve® Sex Toys
- Dade 301 Adult Toys & Videos
- Todd Couples Superstore
- No Reservations Lingerie & Adult Novelties Store
- The Fifth Wheel Adult Superstore
- Diggler’s Adult Superstore
- XXX-Clusive adult & smoke shop
- Pure Pleasure Adult Entertainment Stores
- Intimate Desires Adult Entertainment Stores
- Giggles world Adult Entertainment Stores
- Sara’s Secret Adult Entertainment Stores
- Dreamers Adult Entertainment Stores
- Adult Super Store video
- Adult Emporium
- Adult Playtime Boutique
- 8th Avenue Exotic Video
- Cupid’s Corner
- Romantic Adventures
- Southern Exposure Couples
- Lion’s Den St. Augustine Florida
The sex toy and adult sex accessories store business is not a green business, as a matter of fact, you will come across several sex toy shops and adults stores when you go shopping for sex toys and other adult sex materials. So, if you are mapping out your economic analysis, you should carry out thorough market survey and costing of what is required to rent a store and the amount needed to stock your store with sex paraphernalia or erotica, including pornographic DVDs and magazines and sex toys and enhancement products such as vibrators, rubber penises, lubrication, anal beads, penis rings, other sex paraphernalia from different manufacturing brands that are in demand in your location and also the running cost of the business.
Over and above, if you are considering starting a sex toys store business, then your concern should not be limited to the cost of renting a store and stocking your store with sex paraphernalia, you should also concentrate on branding and how to build a robust clientele base. The truth is that if you are able to build a robust clientele base, you are sure going to maximize profits in the business.
Starting Your Sex Toys Store Business from Scratch vs Buying a Franchise
If you are looking towards starting a sex toy and adult sex accessories business, you would have to start from the very scratch simply because you can hardly get the franchise of a sex toy store business to buy. It is a business that is open to all and sundry.
Besides, starting a sex toy and adult sex accessories store business from the scratch is less stressful when compared to other small scale businesses which usually require detailed groundwork before launching the business. With the sex toy store business, you should just try as much as possible to secure a shop that is close to a major road and then leverage on every marketing tools within your disposal especially the internet when it comes to marketing your sex paraphernalia or erotica, including pornographic DVDs and magazines and sex toys and enhancement products such as vibrators, rubber penises, lubrication, anal beads, penis rings, other sex paraphernalia from different manufacturing companies.
Please note that most of the big and successful sex toy and adult sex accessories stores around started from the scratch and they were able to build a solid business brand. It takes dedication, hard work and determination to achieve business success.
Possible Threats and Challenges You Will Face When Starting a Sex Toy Store
If you decide to start your own sex toy store business today, one of the major challenges you are likely going to face is the presence of well – established sex toy shops/adult stores within your business location that are also into selling sex toys and games, selling sex enhancement products, selling and renting pornographic movies, and selling pornographic magazines, calendars and other paraphernalia. The only way to avoid this challenge is to create your own market.
Some other challenges and threats that you are likely to face is economic downturn; if the economy is in bad shape, history has it that businesses such as sex toy stores and the likes usually struggle to maintain their old customers or even welcome new customers. So also, unfavorable government policies can also hamper the growth of your sex toys store. There is nothing you can do as regards these threats and challenges other than to stay positive that things will work out well for you.
Starting a Sex Toy Shop Business – Legal Matters
- Best legal entity to use for this type of business
Generally, you have the option of either choosing a general partnership, limited liability company which is commonly called an LLC, or a sole proprietorship for a sex toy and adult sex accessories store. Ordinarily, sole proprietorship should have been the ideal business structure for a small – scale sex toy and adult sex accessories store especially if you are just starting out with moderate start – up capital in a small neighborhood. But people prefer limited liability Company for obvious reasons.
As a matter of fact, if your intention is to grow the business and have chains of sex toy and adult sex accessories stores across the United States of America and other countries of the world via franchising, then choosing sole proprietor is not an option for you. Limited Liability Company, LLC or even general partnership will cut it for you.
Setting up an LLC protects you from personal liability. If anything goes wrong in the business, it is only the money that you invested into the limited liability company that will be at risk. It is not so for sole proprietorships and general partnerships. Limited liability companies are simpler and more flexible to operate and you don’t need a board of directors, shareholder meetings and other managerial formalities.
These are some of the factors you should consider before choosing a legal entity for your sex toy and adult sex accessories store business; limitation of personal liability, ease of transferability, admission of new owners, investors’ expectation and of course taxes. You can start this type of business as limited liability company (LLC) and in future convert it to a ‘C’ corporation or an ‘S’ corporation when you have the plans of going public.
Catchy Business Name ideas Suitable for a Sex Toy Store
When it comes to choosing a name for your business, you should be creative because whatever name you choose for your business will go a long way to create a perception of what the business represents. Usually it is the norm for people to follow the trend in the industry they intend operating from when naming their business.
If you are considering starting your own sex toy and adult sex accessories store business, here are some catchy names that you can choose from;
- Vitus Lewis® Adult Entertainment Store, Inc.
- Sweet Couples™ Sex Toys and Adult Sex Accessories Store, LLC
- Burning Passion™ Adult Entertainment Store, Inc.
- Give ‘n’ Take Sex Toys and Adult Sex Accessories Store
- Mark Fernandez Sex Toys and Adult Accessories Store, Inc.
- James & Jane® Sex Toys and Adult Accessories Store, Inc.
- Cloud 9™ Sex Toys and Sex Accessories Stores, Inc.
- Georgina Paulson™ Sex Toys and Sex Accessories Store, LLC
- Kiss ‘n’ Tell™ Sex Toys and Sex Accessories Stores, Inc.
- Madonna Whyte® Sex Toys and Sex Accessories Store, Inc.
In the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from. So, it is important to create a budget for insurance and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your sex toy and adult sex accessories store business.
Here are some of the basic insurance covers that you should consider purchasing if you want to start your own sex toy and adult sex accessories store business in the United States of America;
- General insurance
- Health insurance
- Liability insurance
- Workers compensation
- Overhead expense disability insurance
- Business owner’s policy group insurance
- Payment protection insurance
Intellectual Property Protection/Trademark
If you are considering starting your own sex toy and adult sex accessories store business, usually you may not have any need to file for intellectual property protection/trademark. This is because the nature of the business makes it possible for you to successfully run the business without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
But if you just want to protect your company’s logo and other documents or software that are unique to you or even jingles and media production concepts, then you can go ahead to file for intellectual property protection. If you want to register your trademark, you are expected to begin the process by filing an application with the USPTO. The final approval of your trademark is subjected to the review of attorneys as required by USPTO.
Is Professional Certification Needed to Run a Sex Toy Shop?
When it comes to sex toys and adult accessories store business, you do not need to have any formal training or special certification before you can be allowed to start a sex toys store business. All you need is informal training that will expose you to the in and out of the sex toys and accessories buying and selling business.
On the other hand, if you come across any form of certification that can aid you to properly conduct your sex toys store business, then by all mean try and pursue such certification.
List of Legal Documents You Need to Run a Sex Toy Store
The essence of having the necessary documentation in place before launching a business in the United States of America cannot be overemphasized. It is a fact that you cannot successfully run any business in the United States without the proper documentations. If you do, it won’t be too long before the long arm of the law catches up with you.
These are some of the basic legal documents that you are expected to have in place if you want to legally run your own sex toy and adult sex accessories store business in the United States of America;
- Certificate of Incorporation
- Business License
- Tax Payer’s ID/Tax Identification Number
- Business Plan
- Non – disclosure Agreement
- Copy of license for the service support facility and/or a recent inspection report
- Employee Handbook
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Company Bylaws
- Memorandum of Understanding (MoU)
- Building License
- Franchise or Trademark License (optional)
Financing Your Sex Toy Store Business
Starting a sex toy and adult sex accessories store business can be cost effective especially if you choose to start on a small scale by running a sex toy store in a street corner. Securing a standard and well – positioned store facility and stocking your store with a wide range of sex paraphernalia are part of what will consume a large chunk of your start – up capital, but if you choose to start the business on a large scale, you would need to source for fund to finance the business because it is expensive to start a large scale sex toy store business.
No doubt when it comes to financing a business, one of the first thing and perhaps the major factors that you should consider is to write a good business plan. If you have a good and workable business plan document in place, you may not have to labor yourself before convincing your bank, investors and your friends to invest in your business.
Here are some of the options you can explore when sourcing for start – up capital for your sex toy and adult sex accessories store business;
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for loan from your bank
- Pitching your business idea and applying for business grants and seed funding from donor organizations and angel investors
- Source for soft loans from your family members and your friends
Choosing a Suitable Location for a Sex Toy Store Business
When it comes to choosing a location for your sex toy and adult sex accessories store, the rule of thumb is that you should be guided by the demand for such products and easy access to wholesale purchase of a wide range of sex paraphernalia from different manufacturing brands. Of course, if you are able to secure a central location for your sex toy store, it will give people easy access to your store.
It cannot be overemphasized that the location you choose to open your sex toy and adult sex accessories store business is key to the success of the business, hence entrepreneurs are willing to rent or lease a facility in a visible location; a location where the demography consists of people who are old enough and who have the required purchasing power.
If you make the mistake of renting or leasing a facility for your sex toy store in a not too visible or hidden location simply because it is cheap, then you must be prepared to spend more in promoting the business and perhaps giving direction to potential customers.
These are some of the key factors that you should consider before choosing a location for your sex toy and adult sex accessories store;
- The demography of the location
- The demand for sex toys and adult sex accessories in the location
- The number of adults and the purchasing power of residents of the location
- Accessibility of the location
- The number of sex toy and adult sex accessories stores in the location
- The local laws and regulations in the community
- Traffic, parking and security
Starting a Sex Toy Shop Business – Technical & Manpower Details
On the average, there are no special technologies or equipment needed to run this type of business except for Point of Sales (POS) Machines, shelves, and software applications. So also, you will definitely need computers/laptops, internet facility, telephone, fax machine and office furniture (chairs, tables, and shelves) amongst others and all these can be gotten as fairly used.
As regards leasing or outright purchase of a store facility, the choice is dependent on your financial standing, but the truth is that to be on the safe side, it is advisable to start off with a short – term rent/lease while test running the business in the location. If things work out as planned, then you go on a long – term lease or outright purchase of the property.
When it comes to hiring employees for a standard sex toy and adult sex accessories store business, you should make plans to hire a competent Chief Executive Officer (you can occupy this role), Admin and Human Resources Manager, Merchandize Manager, Store Manager, Sales and Marketing Officer/Sales Girls and Sales Boys, Accounting Clerk, and Cleaners. These are some of the key employees that you can work with. On the average, you will need a minimum of 3 to 6 key staff members to run a small – scale but standard sex toy and adult sex accessories store business.
The Services Process Involved in the Sex Toy and Adult Sex Accessories Store
When it comes to buying and selling stuffs, there are no hard and fast rules about it. Basically, it is the duty of the merchandise manager to help the store stock goods (a wide range of sex paraphernalia or erotica, including pornographic DVDs and magazines and sex toys and enhancement products such as vibrators, rubber penises, lubrication, anal beads, penis rings, other sex paraphernalia, books and magazines and adult video from different manufacturing brands).
They go out there to source for good purchasing deals and they also ensure that they do not only purchase at the right prices that will guarantee them good profits, but also ensure that they purchase sex toys and adult sex accessories that are in demand in their business location.
Once the sex toys and adult sex accessories are bought, they are properly arranged in the store for customers to see and purchase. On the other hand, they are also expected to deliver orders made by clients if such services are available in their store.
It is important to state that a sex toy and adult sex accessories store may decide to improvise or adopt any business process and structure that will guarantee them efficiency and flexibility; the above stated sex toy and adult sex accessories store business process is not cast on stone.
Starting a Sex Toy Shop Business – The Marketing Plan
- Marketing ideas and strategies
Generally, running a business requires that you should be proactive when it comes to marketing your goods or services. If you choose to launch a sex toy and adult sex accessories store business, then you must go all out to employ strategies that will help you attract customers or else you will likely struggle with the business because there are well – known brands determining the market direction for the sex toy and adult sex accessories stores industry.
These are some of the marketing ideas and strategies that you can adopt for your business;
- Introduce your sex toy and adult sex accessories store by sending introductory letters alongside your brochure to corporate executives, commercial sex workers, LGBT communities, students, migrants, entrepreneurs, business people, celebrities, public figures, military men and women, sports men and women, tourists, cyclists, power bikers and every adult in the neighborhood where your sex toy shop will be located
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across, so that those on the social media or those who read blogs can know where to go when they need to purchase sex toy and adult sex accessories within your location
- Create a basic website for your business so as to give your business an online presence
- Directly market your products
- Join local sex toy and adult sex accessories store associations for industry trends and tips
- Provide discount days for your customers
- Advertise our business in community based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories)
- Encourage the use of word of mouth marketing (referrals)
Factors That Will Help You Get the Right Product Pricing
One key factor that will help you sell your sex toys and adult sex accessories at rock bottom prices is to purchase your items directly from the manufacturers in pretty large quantities. The truth is the higher the quantities of items that you purchase directly from the manufacturers, the cheaper you tend to get them.
Another strategy that will help you retail your sex toys and adult sex accessories at the right price is to ensure that you cut operational cost to the barest minimum, and channel your efforts towards marketing and promoting your brand name. Asides from the fact that this strategy will help you save cost, it will also help you get the right pricing for your products.
You can also try as much as possible to work with independent contractors and marketers; with that, it will help you save cost for paying sales and marketing executives.
Strategies to Boost Your Sex Toy Shop Brand Awareness and Create Your Corporate Identity
If your intention of starting a sex toy and adult sex accessories store business is to grow the business beyond the city where you are going to be operating from to become a national and international brand by opening chains of sex toy and adult sex accessories stores and franchising, then you must be ready to spend money on promotion and advertisement of your brand.
No matter the industry you belong to, the truth is that the market is dynamic and it requires consistent brand awareness and brand boosting cum promotion to continue to appeal to your target market. Your corporate identity has a lot to do when it comes to building a profitable business.
Here are the platforms you can leverage on to boost your brand awareness and create corporate identity for your sex toy and adult sex accessories store;
- Place adverts on both print (newspapers and sex magazines) and electronic media platforms
- Sponsor relevant community based events/programs
- Leverage on the internet and social media platforms like; Instagram, Facebook, Twitter, YouTube, Google + et al to promote your products
- Install your billboards in strategic locations all around your city or state
- Distribute your fliers and handbills in target areas
- Contact corporate executives, commercial sex workers, LGBT communities, students, migrants, entrepreneurs, business people, celebrities, public figures, military men and women, sports men and women, tourists, cyclists, power bikers and every adult in the neighborhood where your sex toy shop will be located informing them about your business and the products you retail
- List your sex toy and adult sex accessories store in local directories/yellow pages
- Advertise your sex toy and adult sex accessories store in your official website and employ strategies that will help you pull traffic to the site.
- Position your Flexi Banners at strategic positions in the location where your sex toy and adult sex accessories store is located.
- Ensure that all your staff members wear your branded shirts and all your vehicles and trucks/vans are well branded with your company logo et al.