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How to Start Your Very Own Online Sex Shop

Imagine this scenario: You are driving back home from your partner’s apartment thinking about your relationship, about their parents and about the next time you are going to see them. And yes, you are also thinking about the sex you had together.

It was good. The evening started with watching Netflix and chilling with some wine. Season Two of Westworld was the series you both chose to get you nice and relaxed. You made your move and they accepted it - from then on you both had your regular, everyday normal sex. The next morning you hit the road back home with your fond memories of the previous night.

Then you start to think: “What if, instead of average sex, we could have tried something mind-blowingly amazing instead?” A few minutes later you come to the realization that the thing that stood between you and being able to sexually think outside the box is the lack of kinky accessories that would take the sex to the next level.

But where can you get them? Online? Or do you have to go to a store to buy them?

This idea motivates you to start Googling the first thing that comes into your head – ‘Crazy sex toys for boring people’ (harsh, but true). You see a couple of options, click on one, and then struggle to find something that sexually inspires you.

The posterior parietal cortex in your brain starts to work. By your calculations, many people doing exactly the same thing as you might be experiencing the same thing. There is nothing so frustrating as going to a website for sex toy suggestions and being bombarded with hundreds of choices. You are just not sure where to start.

The demographics for the people who surf sex shops are huge. Male and female; 18 to 80 years old; heterosexual and homosexual and everyone in between. How much are they actually spending?

This number is probably around the $10 to $20 million a month mark. And then you would be very right to suddenly have your entrepreneurial mind kick in and say – ‘I MUST BUILD ONE’. Unfortunately, unlike the movies, it is not simply the case of “If you build it, they will come”, as you will see.

Understanding that a brick and mortar establishment is no longer something that is relevant; selling online is the only option for anyone hoping to start a sex toy distribution and sales model. But how does one start?

The solution to this question is not always as simple. There are many ways one can start:

1. Do your market research. Some people have started businesses without any research and have done well. But they are the exception – not the rule. It’s best to learn how many people are interested in the products that will be stocked by the store. Are they wanting to buy many different products or specific ones? How much are they prepared to spend? Is it going to be a global business or a local one?

2. In New Zealand, there are more than a few players on the sex shop market. To name a few: Peaches and Cream, Adult Toy Mega Store, Wild Secrets, Love Honey, D.vice, and Get Sex Toys. The only ones to have a high street presence is Peaches and Cream, and even they might have to re-design their business model as online competition and running stores costs increase. They are facing competition from sex store giants like Amazon and AliExpress.(Here’s a list of the remaining physical sex stores in NZ with a countdown clock monitoring their slow disappearance. The sad but true evidence that most of these businesses are struggling).

Peaches and Cream store on K’ Road, Auckland

 3. What is your financial status? Building an e-commerce site requires at least a $20K initial investment. That includes building a website on Magento, Shopify or WooCommerce, spending money on a reliable hosting provider, and having a top-notch design among many other expenses.

4. Inventory: Are you going to keep the inventory in a fulfilment centre (like Amazon) and let them deal with all the orders to be dispatched and the storage of your products? Or are you going to lease a warehouse and hire staff to take care of the orders? Leasing a warehouse and employing people is a costly operation. You need to pay, at the very least, minimum wages, sick days, leave days, grief days, Kiwisaver and all sorts of taxes. 

Adult Warehouse NZ

5. Drop-Shipping – Drop-shipping has been around for at least 20 years now. How it works is that technically, you can present any product you want on your site which you sourced from another site. The mark-up is then added and the item is offered for sale to anyone (called arbitrage). Many drop-shippers use Amazon as their main supplier and then offer the product they source from Amazon for sale on eBay or their Shopify website (or vice-versa). This particular strategy is less risky as you don’t own any products and your losses are very limited. The profits come from selling the products with a nominal mark-up to cover costs and make a small profit. It’s a good way to dip your toe into the market without plunging in completely right away.

6. Select a niche market: By focusing on a smaller, more fringe market like only male/female/gay/lingerie may seem tempting to the first-time sex store entrepreneur. This is a surprisingly effective way to try out a business venture. After all, even Amazon started off as a book selling site.

7. Another popular way to start a sex store business is to buy one. You can go to Trade Me-Businesses for sale and find a sex shop which may be running well or struggling. Another way is to contact them via their website. You’ll be surprised to know of how many of them are looking to buy their way out (this is not an easy business). In fact, Femplay.co.nz and Mrspalmers.co.nz. were bought using this method. Each had a lot of potential, but the market in New Zealand was simply not big enough for so many sex shops.

8. What is your POD – How would you make things better so that you will stand out from the rest? Copying anyone else might work, but to be able to compete with the ‘big tigers’ you must offer a unique and better experience than others, or at least aim to.

9. Are you interested in manufacturing sex toys or just selling the biggest brands in the industry (maybe a mix of both)? Manufacturing sex toys with your own private label can increase your margins on any category. This is the preferred method for sellers on Amazon. The problem is to find the right suppliers and the right products, and of course it requires big pockets because there’s a minimum quantity for each order. You can find more info about available sex toys in Alibaba .

10. Marketing: Words like SEO/SEM/PPC UX/UI shouldn’t be alien to you. At Cinder, thousands of dollars a month are spent on marketing. All profits must have a certain amount poured back into marketing because it is nearly the biggest spend of the business. Google paid ads are not cheap and small mistakes can cost a lot of money.

Nothing of what you have just read will really prepare you for your first online adult shop business venture. These are only some ideas that may look good on paper but in real life not many businesses survive the first 5 years. There is a lot of trial and error, luck and intuition involved.

When Cinder started, it was all about the passion to do something better and earn happy clients (hopefully) for life. All the pitfalls of a fledgling business were unknown at the beginning - but everyone was keen to learn and get better, which makes it all worthwhile.

A lot of people think selling things online is easy because they hear about the success stories and not the failures. In reality it takes time and patience and even then there is no guarantee. It has taken us much longer to get Cinder heading in the right direction than we thought it would, even though we have sold things online before.

 

If you are interested in launching your own adult online shop feel free to contact us, we might have some valuable information for you.

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