If you’re passionate about fashion, starting a hat business may be a great way to turn your creativity and skills into a lucrative hustle.
With the right wholesalers, you can create customized hats that meet specific market demands.
Unlike other fashion accessories, hats are essential items that can be sold to many niche audiences, from sports fanatics to outdoor enthusiasts.
In this guide, we’ll provide practical steps to start a custom hat business and explain why it’s worth considering.
Why Should You Consider Starting a Hat Business?
There’s no shortage of great online business ideas. If you’ve been quietly contemplating starting a fashion brand, consider opening a custom hat online shop.
Platforms like Shopify, Etsy, and eBay make it simple to create a store for people to buy from. Even if you’re not a natural designer by trade, you can work with designers like the ones from The/Studio to receive feedback or have them design it for you.
So why a custom hat business?
Hats are a foundational wardrobe piece allowing you to cater to many niche markets. You can specialize in sports caps, vintage-style hats, beanies, sun hats, and more.
With online manufacturers like The/Studio, you can create original high-quality products rather than cheap products that quickly saturate the market.
And like any other e-commerce business, you get to create a comfortable lifestyle business. You put work upfront and earn money somewhat passively once all the marketing systems and fulfillment processes are implemented.
If you’re passionate about fashion, starting a custom hat business might be a no-brainer!
Starting a Custom Hat Business in 10 Steps
Anyone willing to dedicate themselves to learning the skills necessary can create a successful brand.
Follow these steps to put yourself in a great position to succeed.
1. Researching the Hat Market
While you may already have an idea in your head of what you’d like to sell, don’t jump in just yet.
Picture this – you’ve spent hours learning how to start a fashion brand and purchased a bulk order of custom hats.
On launch day, you begin spending advertising dollars to drive traffic to your online store, only to hear crickets.
Market research ensures you sell products that people want to buy. There are two forms of market research:
- Primary research: Data you collect by yourself
- Secondary research: Data you get from others who already did the research
The goal is to determine the audience and types of hats or designs that sell well in the marketplace that you can put your own spin on. Here are some ideas on how to perform market research:
- Dig into Google Trends and see what’s growing in popularity.
- Use Facebook Analytics to discover the behaviors, interests, and likes of people who may be your future customers.
- Perform competitor research on other online hat brands to see what people recommend and what they don’t buy. For example, check Etsy and eBay reviews and the number of recently sold items to see their popularity. Review negative comments to swoop in with a better solution to their problems!
2. Pick Your Niche
The most successful e-commerce businesses find a problem in the market and design a product to fix it.
Think about a niche that hasn’t been filled or is highly underserved in the marketplace.
The easiest way to choose a niche is to pick a market you’re already familiar with. Here are niche criteria to help you come up with ideas:
- Demographics: age, gender, geographic location
- Hobbies or lifestyle: For example, activewear or trendy hats with meme designs
- Style: For example, vintage or bohemian-style hats
- Size: Petite or plus-sized hats
- Values: Handmade items or organic cotton hats
3. Pick the Style of Hats You Want to Sell
Hats have cemented themselves as functional and timeless accessories. The key is to decide which hat styles you want to sell.
Start with your customers in mind. If you’re targeting the average fashion-conscious consumer, dad hats, snapbacks, sunhats, and bucket hats are trending.
Here are styles of hats you may want to consider:
- Snapback hats: Snapback hats have a flat brim with five panels. Unlike the baseball hat’s curved brim, the flat brim provides a sporty look – great for casual everyday wear and sports enthusiasts.
- Baseball caps: These hats come in many styles, but generally, they are soft hats with a stiff bill projecting in the front and a rounded crown. They’re perfect for sports lovers and fashion streetwear consumers.
- Trucker hats: Trucker hats are basecamp caps with an adjustable visor and mesh backing. These hats cater best to casual outdoor enthusiasts such as hikers and beachgoers.
- Dad hats: These 6-panel baseball caps have an unstructured front panel and simple logos. Many sellers like to add simple logos or meme designs onto dad hats.
- 5-panel hats: Five-panel hats have two long panels at the top, one wide panel in the front, and two panels on each side. They’ve gained popularity in skateboard culture as part of their attire and help to protect eyes from the sun.
4. Design the Hats Yourself or Have It Outsourced
In the competitive hat space, your designs can make or break your business. Unless you’re a graphic designer with expertise in graphic design tools and creating mockups, we don’t recommend designing it yourself.
You can find designers in the online marketplace, but that requires much vetting and trial-and-error.
The best option is to outsource design work to an experienced print-on-demand supplier like The/Studio, which has experienced in-house designers specifically for custom hats.
That said, if you decide to design the hats yourself, submit the designs in the proper size, format, color profile, and resolution.
- Size: For screen printing or hat embroidery, it’s best to stay between 2.5 to 4 inches in height and 4 to 5 inches in width.
- Image format: Most print-on-demand suppliers accept JPEG or PNG.
- Color profile: This is the method of color mixing. Most color profiles are RGB since it covers the widest range of colors.
- Resolution: Higher-resolution images mean they’re sharper and easier to distinguish. Ideally, you want to export design files at 300 DPI.
5. Select the Printing Method
Screen printing is the most popular choice, transferring ink onto the hat’s surface using stencil and screen. It’s cost-effective and ensures vibrant and long-lasting prints.
Other methods like embroidery or heat transfer are more viable options for smaller orders.
Embroidery involves stitching the logos yourself or with a machine, providing a textured look. Heat transfer is when you print the design onto a transfer paper and use a heat press to imprint the design onto the hat.
6. Choose the Right Manufacturer to Produce the Custom Hats
Creating a custom hat business means you’re in the print-on-demand business model.
You’re responsible for choosing the product, creating the design, and promoting those products. A third-party supplier will print your products and ship them to you so they’re ready to distribute.
As you evaluate suppliers, you want to have a list of criteria to ensure they meet your business needs, such as:
- Product offerings: Every manufacturer offers different product types. Peruse their product catalog to ensure they offer the types of hats that you want to sell.
- Customizability: Some suppliers have more customizations than others. At The/Studio, we let you choose the styles of hats, materials, colors, profile and bill shapes, embroideries, and other details.
- Production and shipping times: Consumers will shop elsewhere when they deem delivery times too long. 90% of US shoppers expect a two to three-day shipping time. Check their shipping times, so you can quickly restock inventory when needed.
- Product quality: Ask your supplier for minimum orders or samples to review the product quality. Low product quality can increase your return rates and lead to bad reviews, ultimately affecting sales.
7. Build Your Clothing Brand
Now it’s time to create a brand that customers can get behind.
That means developing creative elements like your logo, brand name, graphics, and color palette.
Create brand guides to inform your audiences what you stand for and who you serve.
Also, develop your brand position that clearly states your unique value proposition.
A brand should be memorable and connect emotionally with your customers, so they resonate with your company.
8. Pick Your Price Points
Make no mistake; nailing your price points will improve your conversion rates. Pricing your hats too high can scare away your target customers, and too low will leave money on the table.
Cost-based pricing strategies revolve around knowing your total cost after all expenses, including the cost of goods, marketing, shipping, and fees. If it costs $15 to produce the hat, make a sale and ship it out, you may want to charge at least $30.
If you’re competing in a crowded market, you may opt for competition-based pricing. This is where you charge a touch below market rate, so you can swoop in and take the sales from competitors.
There’s no exact science for perfect pricing, but it requires trial and error. Over time, you’ll find the sweet spot to help maximize profits.
9. Establish Your Marketing Channel
As a bootstrap entrepreneur, you’re expected to wear multiple hats.
You’ll have to work with your budget and choose the marketing channels best suited to your skill sets and needs.
Here are platforms you can sell your custom hats:
- Etsy is the largest marketplace for vintage, handmade, and custom products. They allow you to list products and only take a small fee per listing.
- Shopify lets you create your own online store. It gives you full control to design your store and set your policies. However, it’s your responsibility to drive traffic to your store.
- Amazon Handmade is a subsidiary of the e-commerce giant Amazon offering buyers handmade items and craft foods.
- eBay sells just about anything, but it’s trendy among hobbyists who buy collectibles.
10. Fulfill Orders
Your customer service processes will minimize refunds and help keep customers coming back to you. Research shows that boosting customer retention by 5% increases profits by 25% to 95%.
Customer fulfillment starts with proper organization. The last thing you want is to cancel orders and tell customers you’re out of stock.
Make sure to create and print shipping labels immediately after orders are placed. Once orders are shipped, you want software that sends automatic shipping updates to the customer, so they can manually track the orders themselves.
Frequently Asked Questions
If you’re still curious whether starting a hat business is right for you, we’ve put together a short FAQ section.
What Is the Profit Margin on Hats?
On average, profit margins for hats are about 40%. However, they can range between 20% and 60%. This varies depending on factors such as the cost of materials like the fabrics and embellishments. Also, you must factor in marketing spend, tools, and other operational costs.
Is a Hat Business Profitable?
For truly ambitious and motivated fashion expert entrepreneurs, a hat business is one of the most lucrative businesses to choose from. It’s a multi-billion dollar market with many different audiences to sell to. Hats are cheap to buy in bulk and are a staple accessory in the world of fashion.
Looking To Start a Custom Hat Business? Work With Us!
Hats off to you for wanting to start a custom hat business! It’s a rewarding opportunity that lets you earn money while selling products you’re passionate about.
When starting a hat business, follow these steps carefully so you’re fully prepared for the challenges ahead.
If you want to stand out from the crowd and save yourself the trouble of finding a reliable hat manufacturer, The Studio makes it quick and easy to get started. Browse our hat styles, materials, and other customization options. Work with our in-house designers and turn your ideas into reality.