If trends hold steady, there will be an estimated 6 billion smartphones in the world by 2020. This is an incredible opportunity for those who want to break into this market, as there will be increased demand for products to protect these expensive investments from dents, scratches, and breaks. The majority of phone cases are sold online to decrease overhead costs. However, retail storefronts can be a good investment for entrepreneurs depending on the target customers.
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Learn how to start your own Custom Phone Case Business and whether it is the right fit for you.
Start a custom phone case business by following these 10 steps:
- Plan your Custom Phone Case Business
- Form your Custom Phone Case Business into a Legal Entity
- Register your Custom Phone Case Business for Taxes
- Open a Business Bank Account & Credit Card
- Set up Accounting for your Custom Phone Case Business
- Get the Necessary Permits & Licenses for your Custom Phone Case Business
- Get Custom Phone Case Business Insurance
- Define your Custom Phone Case Business Brand
- Create your Custom Phone Case Business Website
- Set up your Business Phone System
There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your custom phone case 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 are the startup and ongoing costs?
- Who is your target market?
- How much can you charge customers?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a custom phone case business?
Some states may require a license to start a custom phone case business, with fees varying per state. If you’re looking to just get your foot in the door, you can purchase a start-up kit for around $3,500. These kits come with heating presses (about the size of a regular printer) that can imprint the design you want from a photo or a drawing. Otherwise, you’ll need around $30,000 or so if you’re planning to perform large-scale penetration of the market. You may use that money to partner with a major factory, or to put a down payment on a storefront.
What are the ongoing expenses for a custom phone case business?
If the cases are dependent on designs you created yourself, your expenses can be kept fairly low. Regardless, you should budget for the following:
- Upkeep and maintenance of machinery
- Market research
- Online sales fees (e.g., Ebay’s cut)
- Design production
- Booth/storefront supplies and fees
Who is the target market?
Your ideal customer is a person looking to invest in a product that will protect their device against damage. Those who just want a flashy design may not be willing to pay as much, making the profit margins more difficult to manage. From there, you can start identifying your demographics. For example, if you want to make superhero cases, then your ideal customers may be in high school or college. If you’re making more practical, standard cases, your ideal customer will be older professionals. Luxury cases, like those encrusted with genuine sapphires or rubies, will only be sold to those with enough disposable income. There are lucrative opportunities in every demographic, so long as the customer understands the value of their phone.
How does a custom phone case business make money?
Custom phone cases make money by selling phone cases to customers for a profit. Maximizing profit involves reframing how customers see cases. It’s not unreasonable to ask a customer to pay $40 to protect their $700 iPhone. High quality cases can command a premium profit margin (up to 600%).
How much can you charge customers?
The market has made it easy for you to charge large profit margins, but it will depend on the type of materials you use and the phone cases you manufacture. Battery cases will cost a lot more to produce than a slim case. As mentioned though, in-demand custom designs can be sold at 600% profit margin. The perceived market value of phone cases is high due to the high cost of the devices these cases are protecting. If a phone case can save a customer from an expensive replacement, then it’s generally worth it to pay the premium for a durable case.
How much profit can a custom phone case business make?
This is one of the most lucrative fields you can currently get into, so profits can be extremely high. If you can sell 1,000 cases a year at $60 at a 400% markup, then you’d have around $45,000 leftover to keep or reinvest in the business.
How can you make your business more profitable?
Custom phone case companies can expand to make laptop or tablet cases, gaming skins, or general phone accessories. For example, you can take generic phone chargers and put your own creative spin on them by providing custom wrapping.
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 Custom Phone Case Business Name Generator
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.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your custom phone case business is sued.
Form Your LLC
Read our Guide to Form Your Own LLC
Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services. You can choose to hire a registered agent or act as your own.
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!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
Small Business Taxes
Depending on which business structure you choose, you might have different options for how your business will be taxed. For example, some LLCs could benefit from being taxed as an S corporation (S corp).
You can learn more about small business taxes in these guides:
- LLC Taxes
- Sole Proprietorship vs LLC
- LLC vs Corporation
- LLC vs S Corp
- How to Start an S Corp
- S Corp vs C Corp
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.
Additionally, learning how to build business credit can help you get credit cards and other financing in your business's name (instead of yours), better interest rates, higher lines of credit, and more.
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.
Recommended: Read our Best Banks for Small Business review to find the best national bank or credit union.
Open net 30 accounts
Net 30 accounts are used to establish and build business credit as well as increase business cash flow. With a net 30 account, businesses buy goods and repay the full balance within a 30-day term.
NetMany net 30 credit vendors report to the major business credit bureaus (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how businesses build business credit so they can qualify for credit cards and other lines of credit.
Recommended: Read our best net 30 vendors, guide and start building business credit.
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.
Recommended: Apply for an easy approval business credit card from Divvy and build your business credit quickly.
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 custom phone case business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
For information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
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.
Learn more about General Liability Insurance.
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.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners, we'll give you helpful tips and advice for creating the best unique logo for your business.
If you already have a logo, you can also add it to a QR code with our Free QR Code Generator. Choose from 13 QR code types to create a code for your business cards and publications, or to help spread awareness for your new website.
How to promote & market a custom phone case business
Identify who you want to buy your phones before you do anything else. Find a way to distinguish yourself from your direct competitors, either by price, designs, or accessibility. For example, if your company does custom photos of different couples, then focus on this feature and start building up your brand this way. Or show examples in a variety of categories to showcase your ability to handle any request your customers have.
How to keep customers coming back
Attracting customers will be based on the quality of your cases and the quality of the designs you offer. Be diligent about new trends in your industry, and listen to customer feedback about what images they’d like to see next. If you focus on pop culture for example, then you’ll need to have phone cases ready right when blockbusters are announced as opposed to after the movie has been out for weeks.
Still unsure about what kind of business you want to start? Check out the latest Small Business Trends to help inspire you.
STEP 9: Create your business website
After defining your brand and creating your logo the next step is to create a website for your business.
While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.
Here are the main reasons why you shouldn’t delay building your website:
- All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
- Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
- Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.
Using our website building guides, the process will be simple and painless and shouldn’t take you any longer than 2-3 hours to complete.
STEP 10: Set up your business phone system
Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.
There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use. Check out our review of the Best Business Phone Systems 2022 to find the best phone service for your small business.
Recommended Business Phone Service: Phone.com
Phone.com is our top choice for small business phone numbers because of all the features it offers for small businesses and it's fair pricing.
Start a Custom Phone Case Business in your State
- District of Columbia
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Rhode Island
- South Carolina
- South Dakota
- West Virginia
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Is this Business Right For You?
This business is good for people who are both creative and practical. There are an infinite amount of design options for phone cases, but some will be more popular (and profitable) than others. A good business owner can both narrow down the choices, and predict trends to gain a market edge. Owners will also need some customer service and advertising experience as well.
Want to know if you are cut out to be an entrepreneur?
Take our Entrepreneurship Quiz to find out!
What happens during a typical day at a custom phone case business?
Business owners will need to oversee the manufacturing process, which may or may not include other employees.
- Conducting market research on what’s popular
- Developing relationships with retail owners
- Managing online listings
- Advertising and marketing cases either online or in person
- Attending events to promote custom designs
- Providing or creating new artwork to supply to a manufacturer
What are some skills and experiences that will help you build a successful custom phone case business?
Highly artistic people will do well in this business, but you’ll also need some people skills and sales skills to service customers effectively — even if you only work online. Owners need to build relationships through the sites they choose to work with, as well as a reputation for quality designs at a fair price amongst the public.
What is the growth potential for a custom phone case business?
Custom phone cases will always be needed as new phone sizes are debuted, and as old cases start to wear out. However, you will face some saturation in the market as there are many different manufacturers in the phone case industry.
Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Learn from other business owners
Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a custom phone case business?
First, explore the many types of cases that are already on the market. Folio and bumper cases protect the phone screen from scratches, while tough cases protect the whole phone from practically any major force. Slim cases cover only the back of the phone, but appeal to those who don’t want their phone to seem bulky. There are also battery cases that can give the battery a little more juice when the user needs it most.
Offer your best designs upfront: you’ll want to really impress customers right off the bat. Decide on the proper sales channels based on design and case type. You can sell anywhere from Etsy to bridal expos to renaissance fairs to a regular storefront in a shopping plaza. While it’s more convenient to sell online, the profit margins are generally higher when you sell in person.
Owners and entrepreneurs may want to start with virtual sales only, while establishing a local presence at community events or exploring local vendor opportunities. Because phone cases are so portable, it only takes a few minutes to set up a basic booth to display your inventory.
How and when to build a team
You won’t necessarily need to build a team right away, especially if you outsource your manufacturing or choose to run the machinery you purchased. If you experience a huge influx in orders though, you should be ready to hire someone to assist in customer service and order fulfillment. This can be done on a temporary basis if need be, but ultimately you should have all the mechanisms in place (even if you don’t use them) if you’re planning to expand your business.