Selling children’s clothing is a niche market that allows you the opportunity to work in the fashion industry and work for yourself. In an article for “Entrepreneur,” Laura Tiffany states you need to make your small business stand out from large franchised clothing stores for children. Becoming a children’s clothing retailer gives you the chance to focus on the community, build relationships with your customers, offer personalized services and sell interesting children’s clothing and accessories your clients cannot find elsewhere.

Choose a legal structure that best serves your children’s clothing store. The legal structure of your business should coincide with your tax structure, the amount of liability you want to assume and the amount of investors you have. A couple of legal structure options include a sole proprietorship or a limited liability corporation (LLC). Before making a decision on a tax structure for your children’s clothing store, discuss the different options with a business lawyer.

Make a business plan for your children’s clothing store. Your business plan will serve as a blueprint of how you will set up and run your business. According to Howard University’s Small Business Development Center, you should include a description of the children’s clothing store that you want to open, the market for a children’s clothing store in the area it will operate, your experience in the retail and fashion industry and details about your competition. You should also discuss how you will gain capital to open a children’s clothing retail store, the start-up amount needed, the cost to operate and your business’s projected financial growth.

Secure financing. Unless you have means to open a children’s clothing store with cash, you will need to apply for a small business loan from a bank or credit union. Another source of financing can also include investors.

Select a location for the children’s clothing retail store. When looking for a location to purchase or rent, consider the area’s zoning requirements, growth potential, amount of traffic, area competition and complementary businesses. Good locations for a children’s clothing store are those that have good visibility to street traffic, offer sufficient parking and are near other child-related businesses, such as daycares, schools, toy stores or clothing stores for adults.

Get the appropriate licenses and permits. The licenses and permits required for a children’s clothing retailer vary by city, county and state, so it is best to inquire about these from your Secretary of State office, as well as the city and county small business assistance offices.

Purchase commercial insurance. If you hire employees to work in your children’s clothing store, you may need to purchase worker’s compensation insurance. Talk to your commercial insurance agent about the possible insurance risks involved with opening a clothing store for children and about making your retail store safe for children and other customers.

Purchase inventory for your children’s clothing store. Tiffany states that in 2001, the best-selling children’s clothes were outfits where the tops and bottoms coordinated. Additionally, the top selling colors for children’s clothing was pink, green and light blue. However, you should still keep on top of the latest trends in children’s clothing and sell those products in your store.