How to Start a Balloon Distribution Business

Start a balloon distribution business by following these 10 steps:

1. Plan your Balloon Distribution Business
2. Form your Balloon Distribution Business into a Legal Entity
3. Register your Balloon Distribution Business for Taxes
4. Open a Business Bank Account & Credit Card
5. Set up Accounting for your Balloon Distribution Business
6. Get the Necessary Permits & Licenses for your Balloon Distribution Business
7. Get Balloon Distribution Business Insurance
8. Define your Balloon Distribution Business Brand
9. Create your Balloon Distribution Business Website
10. Set up your Business Phone System

We have put together this simple guide to starting your balloon distribution business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas.

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

• What will you name your business?
• What are the startup and ongoing costs?
• Who is your target market?
• How much can you charge customers?

Luckily we have done a lot of this research for you.

What will you name your business?

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Balloon Distribution Business Name Generator

If you operate a sole proprietorship, you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name, we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability.

It's very important to secure your domain name before someone else does.

What are the costs involved in opening a balloon distribution business?

The exact cost of opening your business hinges on where you base your operations. For instance, many balloon distributors start from their own homes, which negates the overhead of a business lease or business utilities. In this case, your only real costs will be your opening inventory (which will likely cost $5,000 or less, depending on the amount and type of balloons you are buying), industrial helium tank (which should cost $350 or less), and a vehicle large enough to transport inflated balloons (this cost may vary, but you can obtain a decently-sized SUV for $10,000 or less). If you decide to have a standing location, you must pay a monthly lease (which will vary by city, but will likely be $2000 or more) and utilities (which will be $500 or more depending on the size of your building). Finally, don't forget to consider investing $1,000 to $2,000 into some modest traditional advertisement, though you should also be embracing the free advertising possible with social media.

What are the ongoing expenses for a balloon distribution business?

The ongoing expenses for such a business are minimal. If you are operating from your own home, there is no monthly lease or utility costs. You are basically paying for the balloons themselves (which you will buy as your stock sells, so this amount may vary, but will likely be less than $1,000 per month depending on your volume), gas for delivering the balloons, and the cost for any ongoing traditional advertising you may do (though, as mentioned earlier, social media advertisement is functionally free and very effective, largely negating the need for traditional advertising). You will periodically need to replace your helium, and this will likely cost $100 or less per canister.

Who is the target market?

As mentioned earlier, your best clients are young children. Selling to children allows you to sell more balloons with popular tv and movie characters printed on them, as this will make the child even more enthusiastic about the balloon. You can also charge more for character balloons.

How does a balloon distribution business make money?

The model for your business is quite simple: you charge customers different sums of money for different styles of balloons.

How much can you charge customers?

How much you charge clients varies by whether the balloons are licensed or not, how many you are selling, balloon size, balloon material, and whether you have personally inflated them. For instance, some venues might sell six or seven non-inflated latex balloons with characters printed on them for three dollars, and they may sell larger foil balloons of the same character for three to ten dollars, depending on size. Non-character balloons may cost half of that amount, but other factors (such as special printing) can affect the cost. You may also sell things like helium tanks for fifty dollars, and if you are personally delivering the balloons, you may want to charge a delivery fee based on mileage. You should charge a higher price for things like custom balloon animals: up to ten dollars per creation, or if you are working at an event, about $100 per hour to make as many balloons as you can during this time (typically no more than twenty).

How much profit can a balloon distribution business make?

How much profit you make depends greatly on your area as well as what you specialize in. Some individuals make $25,000 a year or more serving only as balloon decorators for parties, whereas others make $50,000 or more primarily making balloon animals for private events. By doing both of these things and also simply selling balloons, you can greatly increase possible revenue streams and easily turn this into a six figure business.

How can you make your business more profitable?

As your business picks up, don't forget to consider raising your prices; this remains one of the easiest ways to make your products and services more profitable across the board. Also, while birthday parties are typically your bread and butter in terms of events that you help decorate, don't forget to advertise your services to help decorate weddings and high school functions. Finally, depending on your comfort level, you may take on a persona or a theme when it comes to balloon delivery; as silly as it is, it feels even more fun when kids get deliveries from funny, beloved characters, and this can lead to more repeat business!

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your balloon distribution business is sued.

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history, which can be useful to raise money later on.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a balloon distribution business business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

Is this Business Right For You?

Because your primary audience is young children, this business is solid for those who are great with children. If you choose a specialty such as creating balloon animals, you must already be highly-skilled at creating balloon animals on demand. Finally, this business is best for someone who really knows their area: many balloon businesses operate from mobile trucks or stands, so knowing the best areas to reach the most people is a major part of your success.

What happens during a typical day at a balloon distribution business?

Most of your daily activities come from ordering, displaying, and/or creating balloons and balloon animals for children. A big part of your salesmanship comes from entertaining the children, so there is more interaction with individual customers than in a normal retail job. When you are not ordering, displaying, or selling, you will likely be working on your website and social media presence and looking ahead to future special events that your business can best capitalize on.

What are some skills and experiences that will help you build a successful balloon distribution business?

Any prior experience selling balloons or creating balloon animals is crucial. Similarly, any experience working with children can help you as you get started. Additionally, while while a formal education is not required, any business courses or degrees you have completed can help you establish your business that much more quickly.

What is the growth potential for a balloon distribution business?

The growth potential for this business is modest, with industry growing by about 2.5% from May of 2012 to May of 2016. The exact potential for growth is typically determined by your region and whether there is much competition for your specific services.