How to Start a Shoe Line

Start a shoe line by following these 10 steps:

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

We have put together this simple guide to starting your shoe line. 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 Shoe Line 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 shoe line?

The more you spend on quality materials and manufacturing, the more money you'll pay to start your business. Costs are different for each designer, especially if you choose to open in a highly competitive area where even the cost of materials can run high. Those in the industry say to give yourself at least $200,000, though this isn’t a hard-and-fast rule. One designer started with $35,000 for all expenses (including travel), and planned to make it back within 9 months.

What are the ongoing expenses for a shoe line?

Shoe line owners may have the following ongoing expenses:

• Materials for shoes
• Production/manufacturing charges
• Retail space
• Marketing/website costs
• Employee salaries

Who is the target market?

The target market for most designers are those who have plenty of disposable income. Those who shop for inexpensive shoes are likely to go to major retail stores. However, the demographic of those who want trendy shoes is vast, and everyone needs to wear shoes regardless of how much money they make. Designers may want to develop a secondary line using inexpensive materials that may be purchased at a store like Target or Wal-Mart.

How does a shoe line make money?

Shoe lines have a profit margin on each pair sold. The amount a customer pays needs to cover not just the cost of materials and marketing. They'll also pay a premium for the designer’s time and efforts. Each designer will set their own profit margin based on the cost of production and the demand of their designs.

How much can you charge customers?

Top designer shoes can sell from between $300 and $600. Mid-range shoes may sell from anywhere between $75 to $200. A shoe store like Payless may charge anywhere from $20 to $50 per pair.

How much profit can a shoe line make?

The average profits for a shoe line is about 40%, so the profit margins are extremely enticing to newcomers. Should you sell 200 pairs at $400, you would make approximately $40,000 in profit a year.

How can you make your business more profitable?

Consider selling additional accessories, such as scarves or handbags. Once you understand the finer points of production, it's easier to add to your line of fashion items. You’ll already have the relationship and contacts necessary to take your business to the next level.

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 shoe line 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.

Federal Business Licensing Requirements

If creating your own clothing, make sure to comply with the Federal Trade Commission’s regulations for labelling clothing products.

State & Local Business Licensing Requirements

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

Trademark & Copyright Protection

If you are developing a unique product, concept, brand, or design, it is prudent to protect your rights by registering for the appropriate trademarks and copyrights.

Learn more about trademark and copyright protection

The nature of legal requirements in distance education is ever changing, especially in regards to copyright laws. Here is a frequently updated resource, which can help keep you aware of the legal requirements.

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?

Ideally, the person who starts a shoe line will be able to match their ideas to the current public taste. They’ll also have an inherent love of shoes, as well as a sense of how to create footwear to fit a variety of types of feet/body types.

What happens during a typical day at a shoe line?

A shoe line owner’s day may consist of the following tasks:

• Designing shoes
• Marketing the line
• Networking with distributors
• Scouting manufacturers
• Additional design education

What are some skills and experiences that will help you build a successful shoe line?

Successful designers may come from all walks of life, but they normally have at least some experience in the fashion world. Some people start in retail, asking questions about each line and formulating their own plan on how to eventually become a designer. Experienced designers in the industry will say that much of creating a shoe line is about understanding the production process.

There's a lot to know about the steps necessary to turn an idea that may have started as nothing more than a sketch on a napkin into something that can be sold in stores. However, that doesn’t mean that you need a background exclusively in shoes to be successful. Shoe designers may have experience in other types of design as well (e.g., clothing, product handbags, etc.)

What is the growth potential for a shoe line?

The US market alone spends just under $30 billion on footwear every year, so the growth potential is there. Experts say that this number is only more likely to increase as shoes are an important way for people to express their sense of style.