How to Start a Subscription Box Company: The Complete Guide

Sahar Enady April 25, 2020

0 4 minutes read

Are you trying to learn how to start a subscription box company? If yes, you should check out our guide here on the key steps to take.

The subscription box industry is over 2 billion dollars. Many businesses are seeing big success with these boxes, but there is a lot of competition.

If you’re ready to put your hat in the ring, then you have to learn the basics of how to start a subscription box company. Start something new can be exciting but also confusing, and we are here to help you make it through the maze.

Continue reading this article to learn the best tips for starting a subscription box business.

Figure Out What Will Be In Your Box

Before you can do anything, you need to figure out what is going to be in your box. Keep in mind that you shouldn’t only look at what is making the most money. In fact, if you only think about money when you’re creating your subscription box, you’re likely to start something you don’t feel like finishing.

Instead, try finding an idea that will make money, but it should also be something you have a great interest in. If you aren’t interested in your business, you’ll spend less time on it, and you’ll be less creative — and less likely to stick it out when the going gets tough.

Determine Your Box’s Price

Now it’s time to get down to the numbers. Once you have your box idea, you have to figure out how much filling the box is going to cost you, and how much people are willing to pay for it.

You can get somewhat of an idea by looking at what is already out there and available to customers. How much are they already paying for it? Can you provide products that are of higher quality and charge a premium?

Don’t get too caught up in what the competition is doing, but you do need to be aware of what is out there.

Create Your Box Prototype

You don’t have to have everything in order before you start marketing to potential subscribers. When you start marketing, they only need to have an idea of the type of products you’ll offer. If they like what they see, they will get on board when the real thing comes out.

You need your prototype because, at this point, it’s time to do a prelaunch.

Your prototype box needs to show as closely as possible what you are going to offer. If you’re not sure what type of box you’re going to use out of the gate, just use a normal cardboard box to give people an idea of how it will be.

You also need to know what you’re going to use for packing materials. People are excited to open their boxes, and part of that joy comes from what packing materials are used.

It’s Prelaunch Time

Now that you have everything in order, it’s time to see who wants to buy. Decide on your launch time, but most companies do anywhere from 15 to 60 days.

During this time, you need to collect email addresses. Set a goal to have a certain number of emails and figure out what conversion rate you expect on those interested people.

You’ll have a prelaunch page, and that is where you’ll send people to capture their emails. You can use social media for marketing your new subscription box, so get ready to make a major run through your launch period. This time is the most important time in your business’s lifetime, so don’t skim on your marketing efforts.

Figure Out Product Sourcing and Shipping

While you’re in your prelaunch stage, it is the perfect time to figure out where you’re going to source products from and how you’re going to do shipping.

Don’t be afraid to negotiate prices with your shipping provider as well as with the places where you’ll get your products. People are often happy to make a deal if you sweeten the pot.

Set Up Your Website

Now that you’re almost ready to get going, you need to make sure you have your website up and running. There are many beginner-friendly eCommerce platforms if you aren’t sure how to code or aren’t familiar with platforms like WordPress.

Make sure your design is appealing and that it is easy to get their subscription started. Another way to generate sales is through listing your subscription box on marketplaces, so make sure you set up everything properly to get approved.

Subscription Boxes Vs. Subscription Services

One of the things to keep in mind when you have a subscription box business is that you can’t prorate your services. Since you send out one box a month — it is what it is. People are going to get the box no matter when they sign up for your services.

You might be asking, “What is prorating?” While you can’t use it for your box business, if you also have something you deliver online, you can prorate those services. Prorating is when you only charge your customer for the part of the month they are going to use. This can get a little tricky, so learning how to do it properly is key if you do decide to add services or other online deliverables to your box subscription model.