September 25, 2023

How To Start A Hat Business – 2023 Ultimate Guide

If you want to start your own fashion business selling hats, you might want to know what the hat market is like now, whether you can still make money selling hats, how much start-up capital is needed, and so on. Yes, this article will revolve around these contents in the hope that it can inspire you.

How To Start A Hat Business

Can You Make Money Selling Hats?

Compared with clothes and shoes, which use more materials and are more complex in design and workmanship, hats as accessories have relatively low manufacturing costs, are small, and are easy to carry or transport. It can be said that there is a lot of profit potential from selling hats.

Make Money by Selling Hats

Hats are not replaced as quickly as clothes and shoes as the seasons change, and styles change relatively slowly. For example, people can wear the baseball cap almost all year round, and if it is of high quality, it can be worn for several years.

Typically, high-quality custom hats retail for around $35 to $45, or more. If you buy from a wholesaler, the purchase price is about $5 to $10 per hat. For every hat sold, you can make a profit of about $30, after logistics and other expenses. If you sell 100 hats, you will make about $3,000 in profit.

Simply put, you have a good chance of making money selling hats, with an average profit margin of about 40% (the estimated range is between 20% and 60%). If you want to start a hat business, you need to be aware of the challenges or difficulties involved and delve into what it takes to run a hat business well. It’s a good idea to create a detailed business plan.

The Current Hat Market

According to Grand View Research, the global headwear market size will be approximately US$26.5 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 6.5% from 2023 to 2030. So you can see the potential in the hat business.

The Current Hat Market

The growth in the hat market over the past year or two has been driven primarily by the end of the pandemic and the recovery and popularity of travel and outdoor sports. For example, when people travel from tropical areas to cold areas, they will wear warm hats (beanies, fedoras, berets, etc.); and for outdoor sports, such as hiking, fishing, etc., people will wear boonie hats to provide sun protection and protect their heads.

hat market report

Hats not only have a wide range of applicable scenarios (from daily commutes to work sites to fashion shows to sporting events), but no matter what the age or gender, they also have a large consumer base.

In addition, with the improvement of people’s aesthetic abilities and fashion needs, customized hats have gradually become popular. Hats have always been one of the most popular accessories. Coupled with the ease of access to trendy fashion or famous brands, many people want to have their own unique hats. And the boom in e-commerce has undoubtedly fueled this trend in customized hats.

After understanding the current hat market, you’ll see that starting a hat business has potential and can make money. However, market demand is only one of the important factors that affect whether you can make money selling hats. Competition, business strategy, and management skills cannot be ignored.

How Much Does It Cost To Sell Hats?

The start-up capital required to start a hat business is greatly affected by the size and type of business, purchasing expenses, marketing strategy, etc. Nonetheless, according to extensive surveys and studies, the required start-up costs for selling hats are lower than for other types of businesses (e.g., furniture business, clothing business), ranging from about $500 to $25,000 or more.

How Much Does It Cost To Sell Hats

If you’re on a budget, starting a hat business from home without having to own a brick-and-mortar storefront or office building is well worth considering. By setting up an online hat store and choosing a dropshipping business model, inventory costs can be reduced and the risk of overstocking can be avoided.

When you receive a new order, send the order to your supplier, who then ships the hat to your customer. So, actually, you can start your hat business at a very low cost. Dropshipping is just one of the options, and you already know that its advantage is that it doesn’t require a lot of investment. But its disadvantage is that it is highly dependent on suppliers, which is not conducive to the subsequent maintenance and development of new customers.

If you have sufficient funds, for example, tens of thousands of dollars, you may want to purchase various styles of hats in bulk from wholesalers to run your hat business on a larger scale; or you may want to find a densely populated CBD to open a boutique hat shop; or find a professional manufacturer to provide your customers with exclusive hat customization services, etc.

How much it costs to sell hats depends mainly on your business model and marketing strategy.

Costs You May Want To Consider

  • 1. Buying hats for sale
  • 2. Establishing and maintaining an online store
  • 3. Purchasing hat manufacturing equipment
  • 4. Advertising and promoting business
  • 5. Fees for registering a business and obtaining necessary licenses
  • 6. Renting a storefront or studio
  • 7. Employee costs
  • 8. Logistics costs

Get A Head Start On Your Hat Business

In addition to collecting sales data on the hat market yourself, you can also do it based on what others have done. Get data from others on the types and designs of popular hats and their audiences that are selling well on the market, distill the results, and incorporate them into your own ideas.

Get A Head Start On Your Hat Business

For example, search online for sales data or marketing research reports on the hat business. You can use Google Trends to see what hats are gaining popularity. And use Meta Business Suite to discover your potential customers’ interests, hobbies, behaviors, etc.

hat data from google trend

Learn from your competitors. Research your favorite hat brands or other online hat stores to see what their marketing models are like and what consumers like and don’t like to buy.

Look at the number of hats sold and reviews on Amazon or eBay to get an idea of their popularity. If you see negative reviews from customers, click on them to see why they didn’t like the hat and whether the seller is offering a solution. This will help you avoid or resolve similar situations later.

Learn as much as you can about the hat market, whether that means gathering information online or going offline to hat markets to conduct surveys. If necessary, you can also seek advice from professionals.

What Business Model Do You Want To Sell Hats?

Do you want to open a brick-and-mortar store, an online hat store, or both? It largely depends on your budget.

What Business Model Do You Want To Sell Hats

Physical Hat Store

The location of the store is important. Ideally, opening a store in a high-traffic area will help expose your brand to more people and attract new customers.

Consider the costs associated with running a physical store, such as rent, labor, utilities, etc.

A brick-and-mortar store has one advantage that online stores can’t match: customers can see, touch, feel, and try on the hats in person. Some customers may feel that the hat is not for them just by looking at the picture, but they may be pleasantly surprised after trying it on in person and quickly decide to buy the hat.

Online Hat Store

You already know how inexpensive it is to run a hat business online—you can do it from home alone, and your hours are flexible.

You can put more money into creating a beautiful, attractive website that showcases a variety of hat styles (unlike a brick-and-mortar store that has limited display space).

It is worth noting that the consumer trend in the hat business is shifting to online consumption.

Combining Online and Offline Business Models

It is a very ideal choice, but it undoubtedly requires more capital investment, which also means more manpower, material resources, and time.

Choose Your Niche For The Hat Business

When you start selling hats, having a clear target market and audience will help your hat business grow and gain a foothold in a large market.

Choose Your Niche For The Hat Business

Name Your Hat Brand

A good brand name can be an important step for your hat business. It will represent the image of your hat brand in the minds of consumers and will affect user retention and brand loyalty to some extent.

Name Your Hat Brand

It’s a good idea to choose a name based on your business philosophy and niche. For example, if your hat business focuses on bringing high-quality, affordable hat products that are relaxed and casual to young people, then you need to think of some interesting and easy-to-remember names. Here we come up with “Notjust4hat,” “urMYhat” for your reference. But here are some notices:

  • Avoid hard-to-spell, ambiguous names.
  • Choose a name that will help you expand into other product lines.
  • Make sure there are no duplicate names used.
  • When conceiving the brand name, think about the design of the logo and tie the two together.
  • It is recommended to register the domain name as soon as possible after you have chosen the brand name.

Tips: Shopify’s Business Name Generator is a free online tool that helps you brainstorm a brand name for your hat business. Also, you can check whether the domain name is available on

An Essential Step For Your Business: Source Hats

Generally speaking, there are three ways to purchase hats: work with hat distributors, wholesalers, or manufacturers.

An Essential Step For Your Business Source Hats


Buying from distributors is the fastest way to replenish inventory and enrich the product catalog for your hat business. They understand and recommend to you the more popular hat styles of the moment, but the purchasing prices they offer are slightly higher than those of wholesalers and manufacturers, which means that you will pay more for sourcing hats.


If you are looking to buy similar styles of hats in large quantities at a lower price and make small profits with quick turnover, then working with a wholesaler is your ideal choice. However, you have limited hat styles when purchasing from a hat wholesaler. If you are planning to start a hat business with distinctive characteristics, then it may not be your ideal choice.


Many business people choose to work directly with manufacturers, not just in the hat industry. Especially if you want to provide customers with the unique or latest styles of hats or custom hat services, a professional hat manufacturer can meet your needs well. You can design hats that reflect your brand, and you have more say in the quality of your product. In addition, some manufacturers will give buyers discounts for large orders, tailor purchasing plans based on the buyer’s business situation, etc.

But don’t forget that working with hat manufacturers requires some expertise and experience in production management. However, professional manufacturers will allay your concerns.

You can order hats from a distributor, wholesaler, or manufacturer based on market trends and customer needs. Weigh their pros and cons.

Which Printing Method Is More Suitable For Your Hat Business: Screen Printing Or Heat Transfer

When it comes to choosing a printing method for a hat business, there are many ways to print hats on the market, each with its own unique characteristics. Among the most popular ones are screen printing and heat transfer printing. You can decide which printing method to use based on cost effectiveness, image quality, and the durability of the finished logo.

Printing Method For Your Hat Business

Screen Printing

By using stencils and screens to transfer the ink to the surface of the hat, the resulting image retains its color for a long time because the ink has penetrated into the fabric.

However, because each image color requires a separate screen, screen printing is more suitable for simple hat pattern designs that use only a few colors. If multiple colors are required, it is more expensive. Hence, if you have a relatively large-scale hat business that needs to print hats with simple patterns, screen printing is more economical.

Heat Transfer Printing

Heat transfer vinyl is a popular printing solution for the hat business because it works well for printing designs on surfaces that cannot be reached with traditional printing methods. With heat transfer vinyl, you can choose from a variety of colors and patterns to design your hat styles, and the patterns come in higher resolution. Customizing personalized hats just gets easier, which fits well with the niche hat business.

But there is a demerit: heat-transferred images sit on top of the fabric, are prone to fading and cracking over time, and don’t hold up to machine washing like screen-printed images.

So, if you want to print hat patterns in small batches, thermal transfer is more cost-effective, while screen printing is more suitable for large-volume printing needs.

Decide A Suitable Price For Your Hat Business

The overly high price of your hat business can scare off your target customers, while pricing it too low can result in losses. Choosing a suitable price will help your business go smoothly.

Decide A Suitable Price For Your Hat Business

If your target market for hats is highly competitive, you may choose to price them slightly below the market price to attract more customers.

Many hat merchants use a cost-based pricing strategy, which is based on the total cost after deducting the cost of purchasing the hat, marketing costs, operating costs, shipping costs, etc. As a simple example, if it costs $15 to produce, sell, and ship a hat, you may need to price it at around $30, which is helpful to achieve a positive profit for your business.

There is no exact theoretical basis that will help you price hats perfectly for sale. But as you gain time and experience selling hats, you will maximize profits by pricing cleverly.

Kickstart The Business: Let Your Exquisite Hats Meet Customers

You already know that starting a hat business is not an easy task. In addition to the aspects mentioned above, you also need to establish effective marketing channels, fulfill orders, provide considerate customer service, and more. Starting a hat business may require you to wear many hats. But it’s a rewarding opportunity that allows you to gain valuable experience while pursuing a career you’re passionate about.

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