How to Start an Online Toy Store: 5 Simple Steps

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Not only is the toy industry super fun, but – in 2020 – it was also estimated to be worth a massive $32.6 billion. With such a huge opportunity to make money, it’s hardly surprising that many ambitious entrepreneurs are looking to break into the toy space by building online stores.

Selling toys online can be the most affordable and potentially lucrative way to sell toys. This method of selling has few barriers to entry, requires only a small upfront investment, and offers huge opportunities for growth.

However, starting a toy business isn’t as easy as just buying a few toys and throwing them on a website – at least not if you want long-term success. Luckily, we’ve helped countless businesses follow the right processes and pick the right tools to start selling online. In this guide, we’re going to walk you through everything you need to do and know when starting a toy store business online, step-by-step.

1. Create a Business Plan

All great things start with a plan. Without one, you can easily waste time pushing your business in a direction that, ultimately, leads to failure. A plan will also make your life easier, providing you with daily direction and helping keep you motivated when you are starting a toy business.

Target Market

Many businesses start with a name, but your first point of concern should be working out who your toy store will serve – your target market. Once you’ve defined who you’re going to be selling to, everything else will stem from this; including your business name, the toys you sell, and even how much you’ll be selling them for.

Unlike many other businesses that have clear customers, when selling toys online, things can be a little more tricky as the end-user can differ from the actual buyer. For example, although the toys you sell may be specific to a young age group, you are likely actually selling to parents, uncles, aunties and grandparents.

However, this isn’t always the case. Some toys may be aimed at young adults or adults who are interested in toy culture – in these cases, it is much easier to define your target audience.

When deciding your target market, you’ll need to outline as much detail as possible. This may include details such as:

  • Age range
  • Gender
  • Income range
  • Location
  • Interests

To better understand your target audience, you may decide to create a small number of buyer personas, which can be used to measure business decisions against.

Business Name 

Your business name will play a big role in your success. Find a name that is easy to remember, appeals to your target audience and is niche appropriate. As you’ll also be running an online toy store, you’ll want to consider the availability or the domain name, too.

If the exact match URL for your business name is already taken, consider using a descriptive word to help potential customers discover what you offer. For example, you may add ‘toys’ or ‘toystore’ to your name.

If another business is already using your name, adding a descriptive word can also help differentiate you from others. However, if a business with the same or similar name operates in the same space, then you should seek out other options.

Define a Niche 

Undertaking some competitor/market research will help you identify a potentially lucrative niche. Start by looking at who already serves your target audience. By doing this, you may be able to identify potential gaps in the market.

For example, if your target audience is US-based children aged 7-9, you may notice that there are few options when it comes to eco-friendly educational toys.

Of course, you don’t have to serve a niche that isn’t yet well-served. This is especially true if you reckon that you can offer a better product/service, or if you believe there are only a small number of competitors for a potentially large niche.


Although you could spend an unlimited amount on opening an online toy store, there are only really a few costs that are entirely essential. These include:

  • Stock costs (e.g. buying toys to sell)
  • Storage costs
  • Business costs (e.g. registering your business)
  • Website costs (e.g. registering your domain name and paying for a website builder)

Unless you plan on doing everything yourself, you may also need to factor in costs such as accountancy, marketing and admin support.

How much each of these factors actually cost depends on the products you’re offering, the market you’re targeting, and the scale at which you’ll be launching your ecommerce store. You may also be able to mitigate some costs – such as stock costs – by using a dropshipping arrangement, although this can impact your profits further down the line.


Once you have a good grip on how much setting up your new toy business will cost, you can calculate how much you’ll need to sell your products for in order to make a profit. This can be a little tricky, as you’ll have several fixed costs, along with multiple variable costs, that – as you sell more products – will go up.

Variable costs typically occur every time you sell a product, and include the price you purchase the product for, as well as any commission you pay on a per-sale basis. Fixed costs typically include anything that needs to be paid every month, regardless of how many products you sell – such as your website builder subscription.

You may need to start with an estimate on product costs, or use a recommended retail price in order to assess viability.

Calculating your break even point will help you work out your pricing. Here’s a simple formula to help you work this out:

Break Even Point = Fixed Costs / (Selling Price Per Unit – Variable Cost Per Unit).

For example:

Fixed Monthly Costs = $1000

Selling Price Per Unit = $5

Variable Cost Per Unit = $2

Break Even Point = 1000 / (5 – 2) = 334 units

So in this example, you’d need to sell 334 units each month in order to break even. If your break even point seems too high, then you may need to increase the price of the product to make this more manageable.

However, other factors will also come into play when pricing your toys: such as how much other stores sell similar/the same items

2. Legal Requirements

Although starting an online toy store is far from being wrapped in large swathes of legal red tape, there are a few legal and regulatory issues that need addressing to ensure you’re running your business within the law.

The first thing you’ll need to do is register your business name as a trademark. This helps protect your name against others setting up toy stores under similar – or the same – name, and confusing your customers. It also protects you against having to rebrand should another business later claim trademark infringement against you.

Setting up as a business entity is also an important box to tick. Although you’ll want to do your own business research, most ecommerce stores will set themselves up as an LLC or corporation.

Working with a website expert will help you identify legal requirements for your website, such as terms and conditions and notifications of tracking. Remember, these differ based on your toy store’s location and where you’re selling, so consulting an expert is always worthwhile.

Finally, you’ll want to ensure that you register your business for tax with the IRS and set money aside to pay it.

3. Find Suppliers

Finding good suppliers is the cornerstone of a successful online business. Get it right, and you’ll have a consistent supply of quality toys at competitive prices. Get it wrong, and you’ll struggle to make a profit, whilst wasting your time chasing shipments.

So when setting up your store, it’s important to decide which type of supplier you’ll seek out:


A typical supplier will allow you to make orders for their products which can be delivered to your own storage facility or to a third-party logistics (3PL) company. This is where the toys will be stored until someone orders them, and they’re shipped off.


An alternative to working with traditional suppliers is to use dropshipping. This arrangement allows you to send orders directly from your website to the manufacturer or distributor of the toys, who’ll then fulfil the order on your behalf.

This approach can be significantly more efficient, while limiting your upfront investment in stock. However, it can also lead to much lower profit margins, as the manufacturers and distributors involved typically take significant commissions on each sale.

4. Create Your Website

So – you have a comprehensive business plan, the legal side of business wrapped up, and you know how you’ll be sourcing your toys. Now, it’s time to build your website.

Luckily, with the explosive growth of online shopping, we’ve also seen some fantastic advancements in ecommerce website builders in recent years. These offer a range of tools built specifically for those looking to start an online store.

Look for a platform that has all the functionality you need. For example, it can be helpful to have built-in marketing tools and inventory management systems, especially if you plan on selling a large number of toys on a weekly basis.

A few platforms which are worth adding to your research list due to their advanced ecommerce functionality and easy to use interface include Wix, BigCommerce and Shopify.

Top Tip!

As part of your store building process, you’ll first need to upload your products. These listings are your biggest opportunity to sell to the customer, so you should spend some time and care on them. Start by uploading multiple, quality images from various angles. You may also want to include a video of the toy being used to help kids – and their parents! – visualize how they’ll use them. Then, write an engaging and compelling description that also includes important information: such as the toy’s dimensions, and the materials it’s made of.

5. Develop a Marketing Plan

Neither the best toys nor a fantastic website will mean anything if nobody knows about what you offer – and where to find you. That’s why the final step in creating a successful online toy store is to develop (and follow) a complete marketing plan.

Exactly how you’ll market your online store will depend on several factors, such as the channels you’ll be using, the makeup of your target audience, and the types of promotions you’ll be running. For example, if you sell via marketplaces such as Amazon, your marketing plan will be very different to if you sell exclusively via an ecommerce platform.

A few tried and tested methods that apply to most scenarios include:

  • Posting highly engaging content on social media
  • Paid ads on social media and search engines
  • Email marketing
  • Running sales, discounts and promotions

How to Sell Toys Online: Summary

In this article, we’ve run through everything you need to know to open a successful online toy store. As a quick reminder, here are the steps you’ll need to follow:

  1. Create a business plan that considers your target market, business name, finding a niche, financing your store and setting prices
  2. Assess legal requirements and execute them
  3. Find suppliers
  4. Create your website and upload your products
  5. Develop and follow a comprehensive marketing plan


There are several aspects that need to be covered when opening an online toy store. These include researching and defining your target audience, picking a suitable business name and URL, selecting a lucrative niche, working out how much it’ll cost to start your online toy store, and how much you’ll charge for your toys in order to make a profit.
Written by:
I’m a content writer for Website Builder Expert. I’m a bit of a business and marketing nerd and love sharing my knowledge and experience to help others achieve their business goals. From complex engineering and brewing to international events and brand design agencies, I’ve worked in marketing roles for well over 10 years now. During this time I developed a skill for turning complex (and occasionally dull) information into exciting, easy-to-understand, and actionable content. I also set up my own content marketing consultancy and launched my own ecommerce business on Shopify.


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