Gift Shop Business Plan Template

Gift Shop Business Plan

If you want to start a gift shop business or expand your current gift shop business, you need a business plan.

The following gift shop business plan template gives you the key elements to include in a successful gift shop business plan. In addition to this template, a solid plan will also include market research to help you better understand market trends, your competition and your potential target customers.

You can download our Gift Shop business plan template (including a full, customizable financial model) to your computer here.
 

Gift Shop Business Plan Example

I. Executive Summary

Business Overview

[Company Name] is a souvenir gift shop located in the heart of [Location]. We have an enormous selection of souvenirs, gifts, and other items that will commemorate our customers’ visit to [Location]. We will offer a massive inventory and expect our most popular items to include mugs, shot glasses, t-shirts, magnets, and keychains. Our store will be located in a prime location in the heart of downtown near several tourist attractions. Tourists will easily find our store while walking around downtown and checking out the sights. Any tourists who can’t come to our store in person can shop our inventory on our website.

Products Served

[Company Name] will sell the following souvenirs in its gift shop:

• Mugs
• T-shirts
• Postcards
• Magnets
• Keychains
• Flags
• Shot glasses
• Books about [Location]

Customer Focus

[Company Name] will primarily serve the local tourist industry. [Location] is a popular destination and receives over a million tourists annually.

[Company Name] will also serve the community of [Location]. The demographics of these customers are as follows:

• 502,124 residents
• 289,741 workers
• Average income of $61,000
• 39% married
• 40% in Management/Professional occupations
• Median age: 40 years

Management Team

[Company Name] is led by [Founder’s Name], whose family has run retail stores for more than 30 years. [Founder’s Name] has spent his career working in various roles in these stores, from cashier to upper management. In addition to his extensive experience, he graduated from the [University] where he majored in Business Administration. His experience and education will be our most valuable assets.

Success Factors

[Company Name] is uniquely qualified to succeed due to the following reasons:

• The location is in high traffic with significant numbers of tourists and other passersby daily.
• The management team has a track record of success running gift shops.
• Gift shops are highly successful in communities throughout the United States.

Financial Highlights

[Company Name] is seeking total funding of $310,000 to launch its gift shop. The capital will be used for funding the store build-out, hiring initial employees, marketing expenses, and working capital. Specifically, these funds will be used as follows:

• Store design/build: $100,000
• Equipment and supplies: $50,000
• Initial inventory: $10,000
• Working capital: $150,000 to pay for marketing, salaries, and overhead until [Company Name] reaches break-even

Top line projections over the next five years are as follows:

Financial Summary	FY 1	FY 2	FY 3	FY 4	FY 5
Revenue	$560,401	$782,152	$1,069,331	$1,379,434	$1,699,644
Total Expenses	$328,233	$391,429	$552,149	$696,577	$776,687
EBITDA	$232,168	$390,722	$517,182	$682,858	$922,956
Depreciation	$7,000	$7,000	$7,000	$7,000	$7,000
EBIT	$225,168	$383,722	$510,182	$675,858	$915,956
Interest	$6,016	$5,264	$4,512	$3,760	$3,008
Pre Tax Income	$219,152	$378,458	$505,670	$672,098	$912,948
Income Tax Expense	$76,703	$132,460	$176,985	$235,234	$319,532
Net Income	$142,449	$245,998	$328,686	$436,864	$593,416
Net Profit Margin	25%	31%	31%	32%	35%

 

II. Company Overview

Who is [Company Name]?

[Company Name] is a souvenir gift shop located in the heart of [Location]. We have an enormous selection of souvenirs, gifts, and other items to help customers commemorate their visit to [Location]. All of our inventory will have images, graphics, artwork, and designs that show the energy and spirit of the [Location] community. Tourists will get the full [Location] experience by purchasing our products.

Customers who come into our store will be greeted by friendly staff and an enormous selection of gifts and souvenirs. We will sell hundreds of items that will include mugs, shot glasses, t-shirts, magnets, keychains, and more. All merchandise will be reasonably priced to stay competitive in the market.

Our store will be located in a prime location in the heart of downtown near several tourist attractions. Tourists will easily find our store while walking around downtown and checking out the sites. Any tourists who can’t come to our store in person can shop our inventory on our website. Customers can enjoy free shipping anywhere in the contiguous United States when they purchase at least $25 worth of products.

[Company Name]’s History

[Founder’s Name] incorporated [Company Name] as an S-Corporation on [Date of Incorporation].

[Company Name] is currently being operated out of [Founder’s Name] home. [Founder’s Name] has identified a prime retail location for the shop and has begun lease discussions with the landlord and management company. All operations will move to the retail location once the lease is finalized.

Since incorporation, the company has achieved the following milestones:

• Found a store location and signed a Letter of Intent to lease it
• Developed the company’s name, logo, and website at [website]
• Determined equipment and inventory requirements
• Began recruiting key employees

[Company Name]’s Products/Services

[Company Name] will offer an assortment of souvenirs and gift items that will commemorate our customers’ trip to [Location]. These will include the following:

• Mugs
• T-shirts
• Postcards
• Magnets
• Keychains
• Flags
• Shot glasses
• Books about [Location]

 

III. Industry Analysis

Over the past few years, the gift shop industry has boomed along with the post-pandemic increase in travel and tourism. With fewer regulations, tourists can easily travel to all of their favorite destinations and buy souvenirs/gifts to commemorate the experience. This will lead to a significant boom in revenue for both the gift shop and tourism industries.

Another factor benefitting the industry is the increase in per capita disposable income. Higher income levels will likely enable consumers to pay higher prices for gift items. Furthermore, as the employment rate increases, there will likely be more foot traffic in highly populated areas, further boosting industry demand.

According to Mordor Intelligence, the Gifts Retailing Industry has earned $14 billion in the past year and is expected to grow at a CAGR of 4% over the next five years. These numbers show that the industry is strong, and will continue to do well for the foreseeable future.

 

IV. Customer Analysis

Demographic Profile of Target Market

[Company Name] will serve local residents as well as tourists visiting the [Location] area.

Customer Segmentation

We will primarily target the following customer segments:

• Tourists: Over a million tourists visit [Location] every year. Many of them look for quality gift shops to buy souvenirs for their friends and loved ones.
• Local workers: Residents who work near the gift shop will frequent our store when they need to buy gifts for special occasions.
• Local residents: Our shop will be easy to access by residents traveling through downtown in need of gifts and souvenirs.

 

V. Competitive Analysis

Direct & Indirect Competitors

The following establishments are located within a 20-mile radius of [Company Name], thus providing either direct or indirect competition for customers:

Made in [Location]
Made in [Location] is a family-owned gift shop that sells souvenirs and gifts made by crafters and manufacturers located in [Location]. The company runs three different shops around the city, selling souvenirs, local food and treats, and handcrafted gift items. They have become very popular in recent years, as their stores ensure that local businesses are supported and that tourists receive unique gift items. We expect that Made in [Location] will be our biggest competitor.

Traveltopia
Traveltopia is a nationwide gift shop brand that sells a wide variety of gifts and souvenirs at tourist attractions all around the country. They are typically set up in airports, museums, and similar destinations, but also have a standalone store in downtown [Location]. Tourists looking for locally themed gifts and souvenirs can easily find what they are looking for at one of these locations.

While Traveltopia is a large competitor, they only offer generic souvenirs and gifts to tourists. Consumers who want unique souvenirs will be more inclined to shop at our business.

Sweet Home [Location]
Located across the street from our potential retail location, Sweet Home [Location] is a popular destination for anyone looking for [Location]-themed gifts for friends and family. They have a large and impressive inventory that includes clothing, posters, postcards, mugs, shot glasses, and much, much more. Their location and inventory selection will make them a fierce competitor for our target market.

Competitive Advantage

[Company Name] enjoys several advantages over its competitors. These advantages include:

• Location: [Company Name]’s location is near the center of town. It is located near several popular tourist destinations making it easy for tourists to access the shop. It is also easily accessible to residents and commuters.
• Management: [Company Name]’s management team has years of business and marketing experience that allows it to market to and serve customers in a much more sophisticated manner than its competitors.
• Relationships: Having lived in the community for 20 years, [Founder’s Name] knows all the local leaders, newspapers, and other influencers. As such, it will be relatively easy for [Company Name] to build brand awareness and an initial customer base.

 

VI. Marketing Plan

You can download our Gift Shop business plan template (including a full, customizable financial model) to your computer here.

The [Company Name] Brand

The [Company Name] brand will focus on the company’s unique value proposition:

• Convenient location
• High-quality souvenirs and gifts
• Moderate price point
• Friendly, customer-focused environment

Promotions Strategy

[Company Name] expects its target market to be tourists visiting [Location] as well as residents who live within a 10-mile radius of the shop. [Company Name] promotions strategy to reach these individuals includes:

Social Media
[Company Name] will be active on social media and use targeted social media advertising to attract its most likely customers. The company will post frequently upcoming specials and events.

Website
[Company Name] will have an informative and attractive website that will feature professional photos of the shop, its inventory, store hours, address, and contact information. It will also use SEO to constantly stay at the top of search engines for anyone searching for gift shops near them.

Billboard
[Company Name] will have a billboard in an area of town at a busy intersection where thousands of cars and pedestrians pass daily. The billboard will have an eye-catching picture of its shop that is sure to grab everyone’s attention.

Local Publications
[Company name] will announce its opening several weeks in advance through publicity pieces in multiple local newspapers and publications. Regular advertisements will run to maintain exposure in relevant markets.

Community Events/Organizations
[Company name] will promote itself by distributing marketing materials and participating in local community events, such as school fairs, local festivals, and sporting events.

Ongoing Customer Communications
[Company Name] will publish a weekly flyer promoting popular products, events, and special deals.

Pricing Strategy

[Company Name]’s pricing will be moderate, so customers feel they receive great value when purchasing its products.

 

VII. Operations Plan

Functional Roles

In order to execute [Company Name]’s business model, it needs to perform the following functions.

Service Functions

• Provide customer service
• Operate cash register
• Source and order inventory
• Clean, stock, and organize store

Administrative Functions

• Social media management
• Website management
• Bookkeeping
• Marketing
• Hiring and training staff
• Other general administrative functions

Milestones

The following are a series of steps that lead to our vision of long-term success. [Company Name] expects to achieve the following milestones in the following [xyz] months:

Date	Milestone
[Date 1]	Finalize lease agreement
[Date 2]	Design and build out [Company Name]
[Date 3]	Hire and train initial staff
[Date 4]	Kickoff of promotional campaign
[Date 5]	Launch [Company Name]
[Date 6]	Reach break-even

 

VIII. Management Team

Management Team Members

[Company Name] is led by [Founder’s Name], whose family has run retail stores for more than 30 years. [Founder’s Name] has spent his career working in various roles in these stores, from cashier to upper management. His extensive experience has given him the skills needed to manage the operations of a local gift store. After managing his family’s businesses for several years, he is ready to start a new business that supports his local community.

In addition to his extensive experience, he graduated from the [University] where he majored in Business Administration. The combination of his skills and education will be the shop’s most valuable assets.

Hiring Plan

[Founder’s Name] will serve as the store manager. To launch the gift shop, [Company Name] needs to hire the following personnel:

• Assistant managers (1 to start)
• Sales and inventory associates (4 to start)
• Maintenance personnel: (1 to start)

 

IX. Financial Plan

Revenue and Cost Drivers

[Company Name]’s revenues will come primarily from the gifts and souvenirs that it sells.

The major cost drivers for the company’s operation will consist of the cost of goods, overhead expenses, marketing expenses, and labor.

Capital Requirements and Use of Funds

[Company Name] is seeking total funding of $310,000 to launch its gift shop. The capital will be used for funding the store build-out, hiring initial employees, marketing expenses, and working capital. Specifically, these funds will be used as follows:

• Store design/build: $100,000
• Equipment and supplies: $50,000
• Initial inventory: $10,000
• Working capital: $150,000 to pay for marketing, salaries, and overhead until [Company Name] reaches break-even

Key Assumptions

The following table reflects the key revenue and cost assumptions made in the financial model:

 
5 Year Annual Income Statement

		Year 1	Year 2	Year 3	Year 4	Year 5
Revenues
	Product/Service A	$151,200	$333,396	$367,569	$405,245	$446,783
	Product/Service B	$100,800	$222,264	$245,046	$270,163	$297,855
	Total Revenues	$252,000	$555,660	$612,615	$675,408	$744,638
Expenses & Costs
	Cost of goods sold	$57,960	$122,245	$122,523	$128,328	$134,035
	Lease	$60,000	$61,500	$63,038	$64,613	$66,229
	Marketing	$20,000	$25,000	$25,000	$25,000	$25,000
	Salaries	$133,890	$204,030	$224,943	$236,190	$248,000
	Other Expenses	$3,500	$4,000	$4,500	$5,000	$5,500
	Total Expenses & Costs	$271,850	$412,775	$435,504	$454,131	$473,263
EBITDA		($19,850)	$142,885	$177,112	$221,277	$271,374
	Depreciation	$36,960	$36,960	$36,960	$36,960	$36,960
EBIT		($56,810)	$105,925	$140,152	$184,317	$234,414
	Interest	$23,621	$20,668	$17,716	$14,763	$11,810
PRE-TAX INCOME		($80,431)	$85,257	$122,436	$169,554	$222,604
	Net Operating Loss	($80,431)	($80,431)	$0	$0	$0
	Income Tax Expense	$0	$1,689	$42,853	$59,344	$77,911
NET INCOME		($80,431)	$83,568	$79,583	$110,210	$144,693
Net Profit Margin (%)		-	15.00%	13.00%	16.30%	19.40%

 
5 Year Annual Balance Sheet

		Year 1	Year 2	Year 3	Year 4	Year 5
ASSETS
	Cash	$16,710	$90,188	$158,957	$258,570	$392,389
	Accounts receivable	$0	$0	$0	$0	$0
	Inventory	$21,000	$23,153	$25,526	$28,142	$31,027
	Total Current Assets	$37,710	$113,340	$184,482	$286,712	$423,416
	Fixed assets	$246,450	$246,450	$246,450	$246,450	$246,450
	Depreciation	$36,960	$73,920	$110,880	$147,840	$184,800
	Net fixed assets	$209,490	$172,530	$135,570	$98,610	$61,650
TOTAL ASSETS		$247,200	$285,870	$320,052	$385,322	$485,066
LIABILITIES & EQUITY
	Debt	$317,971	$272,546	$227,122	$181,698	$136,273
	Accounts payable	$9,660	$10,187	$10,210	$10,694	$11,170
	Total Liabilities	$327,631	$282,733	$237,332	$192,391	$147,443
	Share Capital	$0	$0	$0	$0	$0
	Retained earnings	($80,431)	$3,137	$82,720	$192,930	$337,623
	Total Equity	($80,431)	$3,137	$82,720	$192,930	$337,623
TOTAL LIABILITIES & EQUITY		$247,200	$285,870	$320,052	$385,322	$485,066

 
5 Year Annual Cash Flow Statement

	Year 1	Year 2	Year 3	Year 4	Year 5
CASH FLOW FROM OPERATIONS
Net Income (Loss)	($80,431)	$83,568	$79,583	$110,210	$144,693
Change in working capital	($11,340)	($1,625)	($2,350)	($2,133)	($2,409)
Depreciation	$36,960	$36,960	$36,960	$36,960	$36,960
Net Cash Flow from Operations	($54,811)	$118,902	$114,193	$145,037	$179,244
CASH FLOW FROM INVESTMENTS
Investment	($246,450)	$0	$0	$0	$0
Net Cash Flow from Investments	($246,450)	$0	$0	$0	$0
CASH FLOW FROM FINANCING
Cash from equity	$0	$0	$0	$0	$0
Cash from debt	$317,971	($45,424)	($45,424)	($45,424)	($45,424)
Net Cash Flow from Financing	$317,971	($45,424)	($45,424)	($45,424)	($45,424)
SUMMARY
Net Cash Flow	$16,710	$73,478	$68,769	$99,613	$133,819
Cash at Beginning of Period	$0	$16,710	$90,188	$158,957	$258,570
Cash at End of Period	$16,710	$90,188	$158,957	$258,570	$392,389