Business Overview


Also called a “knitting store,” a yarn store sells supplies related to the knitting craft. Normally, they sell yarn balls, crochet hooks, knitting needles, patterns, knitting accessories, and crocheting accessories. Yarn stores can sometimes supply other crafts, giving buyers the materials they need for a number of hobbies.

Who is this business right for?

A yarn store should be owned by someone who truly enjoys knitting. Good yarn store owners like supplying knitting supplies at low prices. They also enjoy spreading the knitting craft with others. Normally, yarn store owners host retreats, giveaways, and fun activities for customers.

Yarn store owners should be people-oriented. They need to connect with customers, focus on developing relationships, and enjoy ongoing knitting projects.

What happens during a typical day at a yarn store?

A yarn store owner needs to stock the supplies needed by knitters. They also need to supply different project outlines, yarn designs, and other tools.

Yarn store owners normally host workshops, too. Others may create guilds or enthusiast groups. Normally, these groups promote a sense of community while boosting store sales. Knitting projects take time to complete, but customers can finish them quickly if a yarn store owner is a good teacher.

From an administrative standpoint, a yarn store owner needs to supply the store’s goods, conduct maintenance, pay the bills, market, and manage workers. Customers need to be pleased, and any guilds need to be taken care of.

What is the target market?

A yarn store’s return customers are crafting enthusiasts. The best customers are those who know what they’re looking for. A yarn store retains customers when those customers become part of a store’s “community.” Like small game shops and cafes, yarn stores succeed with the help of community efforts. It isn’t rare to see groups of knitting enthusiasts spend time in a yarn store. These customers will be your most lucrative customers, and they should be prioritized.

How does a yarn store make money?

A yarn store makes money by selling knitting supplies. They can also sell knitting books, guides, and other informative materials. Some yarn stores sell knitting enthusiast gifts, like mugs and t-shirts.

Yarn store owners can make money by growing a community. These communities can be charged for lessons, workshops, events, food, and trips. Yarn stores can also partner with nearby businesses, gaining community insight while striking deals.

What is the growth potential for a yarn store?

Any hobby supply store needs to balance self-sufficiency with growth potential. Because they’re often hole-in-the-wall type stores, they rely on local support to thrive. Larger yarn stores may want to expand their services. By offering general crafting supplies, a growing yarn store can compete in the national market.

For most yarn stores, however, becoming a go-to local choice is normally a goal. Unfortunately, a lot of local yarn store owners are forced out of business. To grow effectively, a yarn store owner needs to appeal to local communities while also having competitive prices. A good marketing strategy goes a long way.

Getting Started


What are some skills and experiences that will help you build a successful yarn store?

A successful yarn store owner needs to understand the craft deeply. By understanding the craft, a store owner can attract new buyers, build up its current customer-base, and save money. As with any craft, customers will be attracted to whichever store offers the cheapest, most diverse product options.

What are the costs involved in opening a yarn store?

A yarn store costs about $20,000 to start. This price includes the store’s products, rent, utilities, account services, insurance, shop equipment, social media services, website services, and beginning employees. While $20,000 seems like a lot for a small shop, it will greatly contribute to your store’s marketing. As a local hobby supply store, you’ll need to gain as many customers as possible.

What are some insider tips for jump starting a yarn store?

Prepare for local economy changes. Niche retail stores, like yarn supply stores, can face trouble if they’re unprepared. Build up savings fast, and escalate your shop’s appeal. Once you’ve covered the basic supplies, expand. Start a knitting guild, and give customers a reason to return. Form relationships with current buyers, and try to save money while growing your shop.

Host giveaways, fun activities, and retreats. These activities don’t cost too much money, and you can gain money by attracting new customers.

Growing Your Business


How to promote & market a yarn store

Offer “swap days.” You can market your shop while saving money this way. On swap days, knitters bring in unused yarn, swapping it with other community knitters. The best way to promote your shop is through community events. Because knitting is a hobby, big community involvements can boost store attendance.

As for marketing, you should promote via social media. Facebook, Instagram, and even Twitter are great options. These websites can inform customers of your deals, and they can boost your store’s activity during most hours. Take advantage of special events and holidays. Host “sit ‘n knit” events during sporting events. Also, take part in the World Wide Knit in Public Day. Host special classes, and team up with your area’s local artisans. Host money-saving classes, and connect with the area’s artists, too.

How to keep customers coming back

You’ll attract customers by creating unforgettable events. A knitting supply store might be a go-to craft supply resource, but customers will stay for the environment. Be welcoming, and give customers a reason to hang out inside your shop.

How and when to build a team

You should hire at least two employees when you open your shop. Employees should be sourced from local guilds, craft enthusiast groups, and hobby-lovers. Successful yarn shops are run by those who deeply understand the craft.

Legal Considerations


State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a yarn store. 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, check out our informative guide, Sales Tax for Small Businesses.

For information about local licenses and permits:

Certificate of Occupancy

A yarn store is generally run out of a storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO).  A CO confirms that all building codes, zoning laws and government regulations have been met.

  • If you plan to lease a location:
    • It is generally the landlord’s responsibility to obtain a CO.
    • Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a yarn store.
    • After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
  • If you plan to purchase or build a location:
    • You will be responsible for obtaining a valid CO from a local government authority.
    • Review all building codes and zoning requirements for your business’ location to ensure your yarn store will be in compliance and able to obtain a CO.

Reduce Personal Liability

Structuring your business as a limited liability company (LLC) ensures your personal assets are protected in the event your business is sued.

What is an LLC?

Form an LLC in 5 easy steps

Earning Potential


How much can you charge customers?

One ball of yarn can be sold at about $3. 100-percent wool yarn skeins, meanwhile, can be charged at about $5. Other supplies, like books, can be sold for between $5 and $20. Keep the prices cheap. Yarn store shoppers will flock to whichever shop has the lowest prices.

What are the ongoing expenses for a yarn store?

Ongoing expenses are relatively small. Expect to pay about $1 for a yarn skein. Monthly rent is about $2,000 for a small shop. Expect to pay $200 in utilities per month, and expect to pay employees between $8 and $10 per hour of work.

How much profit can a yarn store make?

A small yarn supply store owner can expect to make about $25k to $30k per year. A successful shop owner can, however, make a six-figure salary. The success depends on the local economy, community involvement and the store’s product options.

How can you make your business more profitable?

Become as involved with the community as possible. Successful yarn stores don’t only offer products -- they offer experiences. Even a beginning yarn shop should engage its community as much as possible. Talk to local guilds, and host giveaways and trade-ins. Treat customers like family, and make sure every transaction is backed up by trust and a commitment to community.

Next Steps

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