Do you think this is the right time to start a scrub business?
Due to the impact of the Covid-19 pandemic in recent years, the importance of ensuring safety and hygiene in healthcare has fueled the growth of the scrub business market globally.
The rapid spread of infections has spurred the need for scrub products to protect medical professionals from contaminants and bodily fluids, especially during the treatment of illnesses in hospitals and medical facilities. Therefore, starting a scrub business could be a great idea for you.
If you are still wondering whether the scrub business is right for you, or how to start a scrub business quickly, effectively, and earn a high income, this article will help you orient yourself.
Outline
- Should You Start a Scrub Business?
- 8 Steps to Start a Scrub Business
- Write your Business Plan
- Create a Brand Identity
- Name your Medical Scrubs Business
- Find Financing
- Structure the Enterprise
- Purchase Equipment, Software, Supplies & Tools Needed
- Launch your Business
- Get your Marketing Plan
- Example of Successful Scrub Business Stories
- Conclusion
Should You Start a Scrub Business?
Pros & Cons
There are several typical benefits and drawbacks to consider before deciding whether to start a medical scrubs business.
Pros
- High customer retention rates: Customers have to spend a lot of time experiencing your product. If your products provide a good experience, they will become indispensable for customers.
- High-income potential: Most customers place orders in bulkfor all the medical staff in their clinic/hospital.
- Scalable: There are several different business models and pricing tiers that will allow you to reach all types of customers.
Cons
- Longer sales process: Customers spend a long time experiencing the product before deciding whether to continue to place the next order of your business.
- Saturated market: The market for scrub businesses is highly competitive.
Medical scrub trends
Industry Growth
In recent years, the demand for medical scrubs has skyrocketed across all regions, especially due to the impact of the Covid-19 pandemic. According to statistical data in 2020, the scrub business market increased significantly with a growth rate of 36.1%. In addition, it is expected to increase from $94.29 billion in 2021 to $140.64 billion in 2028.
Source: Fortune Business Insights
Trends and Challenges
Trends in the scrub business include:
- The accelerated spread of infections prompted a heightened for medical scrubs due to the large numbers of patients going to clinics or hospitals.
- Medical establishments and personnel always need to replace the scrub product after a period of use, giving the medical scrub industry a steady market.
Challenges in the scrub business include:
- Regulations on scrubs increase manufacturing costs, and a new business may face challenges with its initial profit margin.
Target Market
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Scrub businesses can operate in a variety of markets, from individuals to large businesses. Therefore, identifying your business’s niche can help you determine which market is suitable.
- Retailers: Their customers are typically physicians, nurses, surgeons, and other medical and healthcare staff. Not only retail through the storefront, but they can also sell in online stores or traveling booths at conventions and markets.
- Wholesalers: If you avoid manufacturing, you can target local stores and sell your line in smaller batches.
- Business contracts: Contracting with these types of businesses can be lucrative and offer stable business because they often need scrubs for their employees.
How much does it cost to start a medical scrubs business?
Starting a scrub business can cost from $7,500 to $67,000. The price includes legal fees, liability insurance, licenses, and permits, trademarking, and other expenses.
How profitable is a medical scrubs business?
Custom scrubs sell for a higher-than-average price because the items are specially manufactured and designed, depending on the type and color of the materials used. Popular stores sell tops and pants from $5 to $50 each, while high-end scrubs tend to sell for $40 – $50. Use Shopify’s free profit margin calculator to help you set the best price on your scrubs and ensure you’re not running at a loss.
What do people want in medical scrubs?
Source: Burst by Shopify
Medical scrubs have evolved from the plain white or green scrubs of the 1950s. In this period, they were customized with various colors, patterns, designs, and details. For example, some people want to have their name embroidered on a jacket, while others want to sew their name on the pocket. These options depend on the requirements of each medical facility or hospital.
In some hospitals, there are rules as to what is acceptable, and what’s not. Some departments are color-coded, while others have the freedom and flexibility to choose what they can wear.
8 Steps to Start a Scrub Business
1. Write your Business Plan
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Business planning is a very important step because you can identify the potential risks and opportunities in your business. You should analyze every aspect of your business including competition, finances, sales, marketing, external environment, and unique selling points. Although the scrub business plan is detailed, they are not set in stone. Therefore, flexible documents are revisited regularly.
2. Create a Brand Identity
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Creating a brand identity is not an easy step because you need to consider many factors from the logo design to the color scheme. Try these suggestions:
- Define your scrub business's purpose and values.
- Choose a color scheme that reflects the personality of your business.
- Develop a unique logo that represents your scrubs brand.
- Create consistent branding across all channels.
If you still have no idea, let Shopify’s Free Logo Maker help you create a brand identity for your business easily.
3. Name your Medical Scrubs Business
Choose a name that is easy to remember and spell. If you have a fixed location for your business, try using the name of that town or state as part of your scrub business’s name.
Here are some tips to help you choose the medical scrubs business name:
- Keep it simple and easy to spell.
- Avoid anything offensive or suggestive.
- Choose a name that reflects the type of business you're running.
- Brainstorm with your friends, family, and colleagues.
- Make sure the domain name is available and the business name isn’t already trademarked.
4. Find Financing
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There are many different ways to finance your scrub business, but you have to think through each method because each decision can have financial implications for you and your business in the long term.
Here are 5 options that you can refer to:
- Tapping into your savings.
- Raising money from friends and family.
- Sourcing investment sources from outside investors.
- Obtaining a bank loan.
- Getting money from a hard money lender.
Banks are typically going to want the borrower to have good credit and be able to invest 15-25% of their money towards the total start-up costs.
5. Structure the Enterprise
Form a Business Entity
What’s your business structure? There are four different types of entities you can choose from, each one has its advantages and disadvantages.
It's important to consider what kind of liability exposure you want and what your goals are for the business. If you’ve just started out and only sold to your acquaintances such as family and friends, a sole proprietorship may be enough. On the other hand, when you've looked for more protection or to grow the business, a corporate organization or LLC may be a better choice.
Select your Location
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When choosing a location for your business, you will need to consider factors such as whether you want to do physical retail, location, sell online, or sell directly to clinics, hospitals, doctor’s offices, or a combination of all. If you choose to sell online, you can refer to opening a store through a platform like Shopify or BigCommerce. But if you decide to sell directly, the ideal location is near medical centers or hospitals. Another essential factor to consider when picking a location is the cost of doing business. Be sure to calculate all of the costs to operate this location.
Set up Your Accounting and Taxes System
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One of the most important things to have for a new scrub business is setting up a proper accounting system. This will help you track your expenses, revenue, receipts, taxes owed, and much more. Besides, you should update your taxes regularly to avoid legal problems, monitor trends as well as cash flow in the business, and maximize profits.
Open a Business Bank Account
Opening a business bank account is intended to help you keep track of your business's income and expenses. You can look at account types like Checking accounts, Savings Accounts, or Business Card Cards. No matter what type of business bank account you choose, be sure to consult and compare features and fees before making your decision.
Apply for Business Licenses and Permits
Each city and locality has different licensing requirements for businesses. Some common permits include a local business license, sales tax permit, Employer Identification Number (EIN), etc. However, you should contact your local business licensing office or chamber of commerce for information on required permits in your area.
Get Business Insurance
Each medical scrubs business will have different insurance costs depending on factors such as the location of the business, the value of the equipment covered, and the number of employees on staff. Insurance can protect you from unanticipated occurrences that can threaten your company.
6. Purchase Equipment, Software, Supplies & Tools Needed
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To fully prepare your business, you should determine what equipment, tools, and supplies you need by making a list. Do some research on the cost difference between providers, or you might consider renting equipment. This step will help you effectively monitor and control the equipment, tools, and supplies you need to run your business smoothly.
7. Launch your Business
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This is your time to launch your business and attract customers. Make sure that you have fully prepared payment methods that are most convenient for consumers, not only who buy directly but also order products on e-commerce sites.
8. Get your Marketing Plan
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Social media and online advertising are the keys to helping businesses reach profitability early on. Let's start with the people closest to you first. Get your friends and family to share your products on social media or partner up with other local businesses in the area to share your business. You should create a website for your scrub business and use it as a landing page to advertise on social networking sites like Facebook or Twitter. Moreover, you can create your own community by building a blog or Youtube channel to share your knowledge to make it easy for users to access your business.
Example of Successful Scrub Business Stories
FIGS
FIGS is an American clothing company based in Santa Monica, California. The company sells scrubs and other products for healthcare professionals. It was founded in 2013 by Heather Hasson and Trina Spear, who are co-CEOs.
FIGS sells scrubs, other medical uniforms, and associated products, including scrub tops, scrub pants, under scrubs, lab coats, activewear, and loungewear. The scrubs are made with a proprietary material that is antimicrobial for odor resistance with four-way stretch and pockets.
All sales are online, via the company's website. FIGS predicted revenue of over $250 million in 2020, mostly through the sale of its upgraded scrubs. The company's warehouse is in the City of Industry, California.
Scrubs Unlimited
Scrubs Unlimited is a store that specializes in providing medical scrub uniforms in bulk. In addition, they also sell lab coats, shoes, and other medical accessories. Scrubs Unlimited has operated since 2000 in the heart of Westwood, CA.
Not just a business providing scrubs, Scrubs Unlimited also has its own Youtube channel to update knowledge and trends about this market. You can visit their Youtube Channel here.
Currently, this is one of the leading businesses in the medical scrubs business trend.
Conclusion
Medical scrubs remain one of the potential and stable markets because medical facilities and hospitals will constantly need to provide new exfoliating products. This is also the right choice for those who have a passion for design and business.
If you want to reach more customers from everywhere, try opening an online store and having your own website. Without extensive resources or coding knowledge, you can start your scrub business on Shopify.
Now, it’s time to start a scrub business of your own!
