Business ideas
8 min read

How to Start a Profitable Sex Toys Business [11 Steps]

11 steps to start a profitable sex toys business. Learn how to create a successful business model, market your products, and more!

By Nick Cotter
Updated Feb 02, 2024

image of a sex toys business
This page may feature products from our affiliate partners, which could influence the products we discuss due to potential compensation. Despite this, our evaluations are impartial, based solely on our independent analysis. The content here is intended for informational purposes and should not be seen as legal advice. For professional guidance, consulting with a legal expert is recommended.
What are you waiting for?
Quit that job & start your business with ZenBusiness today.

1. Perform market analysis.

Entering the sex toys industry requires a thorough understanding of the market to identify opportunities and challenges. A comprehensive market analysis will help you grasp consumer preferences, current trends, and the competitive landscape. Here's how to get started:

  • Research the demographics of potential customers, including age, gender, income levels, and sexual orientations, to tailor your product range effectively.
  • Analyze existing competitors in the space, noting their product offerings, pricing strategies, brand positioning, and market share.
  • Identify emerging trends in the sex toy industry, such as technology integration, eco-friendly products, or shifts in consumer behavior towards wellness and self-care.
  • Evaluate the regulatory environment for selling sex toys in different regions, understanding any legal restrictions or certification requirements.
  • Assess the distribution channels used in the industry, such as online marketplaces, specialized boutiques, or direct-to-consumer sales, to find the most effective way to reach your target audience.
  • Seek out market reports, consumer surveys, and industry forecasts to support your analysis with quantitative data.
image of a sex toys business

Are sex toys businesses profitable?

Yes, some sex toys businesses can be profitable. Many businesses in this industry are successful due to the rising demand for adult products and the increasing acceptance of these products in the mainstream. Additionally, since sex toys tend to have a high markup and a large selection of items to choose from, businesses can often make a sizable profit.

Business Plan Partners
LivePlan logo
Simplify Business Planning with LivePlan - Plan, Track, and Grow Your Business Effortlessly. Save up to 40% today!
Newfoundrz Rating ★★★★★

2. Draft a sex toys business plan.

Creating a well-thought-out business plan is essential for the success of your sex toys enterprise. It will serve as a blueprint for your business, helping you to navigate the market, manage your finances, and outline your strategy for growth. Consider the following key elements when drafting your plan:

  • Executive Summary: Succinctly describe your business, the products you plan to sell, and your target market.
  • Market Analysis: Research and document your industry outlook, target demographic, and competitor analysis.
  • Product Line: Detail the range of sex toys and related products you intend to offer, including any unique features or benefits.
  • Marketing and Sales Strategy: Outline how you plan to attract and retain customers, including pricing, promotions, and sales channels.
  • Operational Plan: Describe your day-to-day business operations, including your supply chain, fulfillment strategy, and any technology you will use.
  • Management and Organization: Define your business structure, management team, and any staffing requirements.
  • Financial Plan: Present detailed financial projections, including start-up costs, funding sources, revenue forecasts, and break-even analysis.
>> MORE:

How does a sex toys business make money?

A sex toys business can make money by selling its products online or in a physical store. They can target people of all genders and ages who are interested in exploring their sexuality. For example, they can target a millennial audience that is more likely to be open-minded and willing to try new products. The business can also offer subscription boxes where customers will receive a box of new sex toys every month. This model provides an ongoing source of income and encourages customer loyalty.

3. Develop a sex toys brand.

Developing a sex toys brand is a crucial step in establishing a distinctive presence in the market. It involves creating a strong brand identity that resonates with your target audience and differentiates you from competitors. Here are some key considerations to guide you in this process:

  • Define Your Brand Values: Identify the core principles that your brand stands for. These could include empowerment, pleasure, safety, inclusivity, and education.
  • Create a Unique Brand Name and Logo: Choose a name and design a logo that is memorable, easy to pronounce, and reflects the essence of your brand.
  • Develop a Brand Voice: Establish a consistent tone of communication that aligns with your brand personality, whether it's playful, sophisticated, or educational. This voice should be consistent across all marketing materials and platforms.
  • Choose a Color Palette and Visuals: Select colors and imagery that evoke the desired emotional response and appeal to your target demographic.
  • Focus on Packaging: Design packaging that's not only discreet but also aligns with your brand's aesthetic and values, enhancing the customer's unboxing experience.
  • Build a Brand Story: Craft a compelling narrative that connects with customers and provides a background on why the brand was founded and what it aims to achieve.
>> MORE:

How to come up with a name for your sex toys business?

When coming up with a name for your sex toys business, it's important to prioritize a name that is professional, memorable, and reflects the products and services you are offering. Brainstorm words and concepts related to sex toys that appeal to you and make a list of potential names. Consider the connotations of each name, as well as its availability online and in other media. Finally, research any potential names with the U.S. Patent and Trademark Office to ensure they are available to use legally. With careful consideration, you can find the perfect name for your business.

Featured Business Formation Partners
image of ZenBusiness logo
Turn your business vision into reality with ZenBusiness's streamlined LLC formation and expert support services.
Newfoundrz Rating ★★★★★
image of Northwest Registered Agent logo
Northwest Registered Agent
Secure your business's future with Northwest Registered Agent's personalized LLC formation and privacy-focused expertise.
Newfoundrz Rating ★★★★★
image of Bizee logo
Kickstart your business effortlessly with Bizee's comprehensive LLC services and free first-year registered agent support.
Newfoundrz Rating ★★★★★

4. Formalize your business registration.

Starting a sex toys business involves navigating sensitive legal and societal norms. Formal registration and compliance with regulations are crucial for operating legitimately and building customer trust. Important steps include:

  • Business Structure: Decide on a legal structure that offers both operational flexibility and liability protection.
  • Register Your Business: Complete all necessary registration processes with local and state authorities.
  • Understand Regulations: Familiarize yourself with any restrictions or regulations specific to selling adult products in your area.

Resources to help get you started:

Explore pivotal resources designed to empower sex toys entrepreneurs with comprehensive market trends, operational best practices, and strategic business growth insights:

  • XBIZ: Offers insights into adult entertainment industry trends including sex toys, with reports and networking opportunities.
  • AVN Media Network: Provides industry news, trade shows, and awards, focusing on adult entertainment and sex toys.
  • Sex Tech Connect: A newsletter that delivers news and updates on the latest in sex tech, including toys. Subscription link available upon visiting their site.
  • The Sexual Health Magazine: Offers insights on sexual wellness and the latest trends in sex toys.
  • Fleshlight's Business Guide for Sex Toys Startups: Provides operational advice and marketing strategies for new entrepreneurs in the sex toy industry. Direct access requires contact with Fleshlight's Business Development team.
  • Statista: For market research and statistics on the global and regional sex toy markets, including consumer behavior and market growth predictions.

5. Acquire necessary licenses and permits for sex toys.

Starting a sex toys business requires careful attention to the legal landscape, as regulations can vary widely depending on location and the specific products sold. To ensure compliance and avoid costly fines or business disruptions, it's essential to obtain the necessary licenses and permits. Here's a guide to help you navigate this critical step:

  • Research local and state regulations: Check with your city, county, and state governments to understand the specific licensing requirements for a sex toys business. This may include a general business license, a retailer's permit, or special adult entertainment permits.
  • Apply for a federal EIN: If you're operating in the United States, obtain an Employer Identification Number (EIN) from the IRS for tax purposes, even if you don't have employees.
  • Understand zoning laws: Ensure your business location is zoned for adult businesses. Some areas have restrictions on how close such a store can be to schools, churches, or residential areas.
  • Comply with health regulations: If your business involves the sale of products that come into contact with the body, ensure compliance with health and safety standards set by organizations such as the FDA or equivalent bodies in your country.
  • Stay informed about changes: Regulations can change, so it's important to stay informed and maintain good relationships with local regulatory bodies to remain compliant over time.

What licenses and permits are needed to run a sex toys business?

Depending on where you are located, you may need to obtain a general business license, a seller's permit, or a seller's license in order to legally operate a sex toy business. Additionally, you may need to obtain any permits or licenses required by your local municipality or county in order to operate a business from home. In some states, you may also need an occupational or professional license if you are selling certain types of sex toys. Additionally, some states may require that businesses selling adult novelties and sex toys obtain a special adult business permit.

6. Open a business bank account and secure funding as needed.

In starting a sex toys business, it's crucial to manage your finances effectively. Opening a business bank account is essential for separating personal and business transactions, which simplifies accounting and tax reporting. Depending on your business plan, securing funding may also be necessary to cover startup costs, inventory, and other business expenses. Here's how you can get started:

  • Research banks and choose one that offers favorable rates and services for small businesses. Make sure they are comfortable working with a business in the adult industry.
  • Prepare the necessary documents, which may include your business license, EIN (Employer Identification Number), and incorporation papers if applicable.
  • Open your business bank account by visiting the bank in person or completing the process online, depending on the bank's offerings.
  • Explore funding options such as small business loans, investors, crowdfunding, or personal savings to gather the startup capital you need.
  • Consider applying for a line of credit for purchasing inventory or for other short-term financing needs.
  • Be transparent with lenders or investors about the nature of your business to ensure there are no complications or misunderstandings later on.

7. Set pricing for sex toys services.

When setting prices for your sex toys services, it's essential to strike a balance between being competitive and ensuring a sustainable profit margin. Consider the cost of goods, market demand, competitor pricing, and perceived value when determining prices. Here are a few guidelines to help you set appropriate pricing:

  • Cost-Plus Pricing: Calculate the total cost of your product, including manufacturing, shipping, and overhead, then add a markup percentage to ensure profitability.
  • Competitive Analysis: Research what similar services are charging and position your pricing in line with or slightly below the competition to attract customers.
  • Value-Based Pricing: Set prices based on the perceived value to the customer, considering the uniqueness and quality of your offerings.
  • Psychological Pricing: Use price points that convey a deal, such as $19.99 instead of $20, to make the cost more appealing to customers.
  • Bundle Offers: Provide discounts for purchasing multiple products or services together, which can increase the perceived value and average order size.
  • Flexible Pricing: Offer different price tiers for different customer segments or create a loyalty program with special pricing for returning customers.

What does it cost to start a sex toys business?

Initiating a sex toys business can involve substantial financial commitment, the scale of which is significantly influenced by factors such as geographical location, market dynamics, and operational expenses, among others. Nonetheless, our extensive research and hands-on experience have revealed an estimated starting cost of approximately $22000 for launching such a sex toysbusiness. Please note, not all of these costs may be necessary to start up your sex toys business.

8. Acquire sex toys equipment and supplies.

Starting a sex toys business requires careful selection of equipment and supplies to ensure a wide range of quality products for your customers. Here are some key steps to acquiring the right items for your inventory:

  • Research the most popular and in-demand sex toy categories to determine the types of products you want to carry, such as vibrators, dildos, bondage gear, and lubricants.
  • Identify reputable manufacturers or wholesalers that specialize in sex toys and adult entertainment products, ensuring they adhere to safety standards and use body-safe materials.
  • Consider the diversity of your product range to cater to various preferences and budgets, including luxury items, mid-range options, and more affordable products.
  • Ensure you have a reliable and discreet distribution system in place for shipping products to customers, maintaining their privacy and trust.
  • Stock up on essential business supplies, such as shipping materials, storage solutions for inventory, and display items for a physical storefront if applicable.
  • Stay informed about the latest trends and advancements in sex toy technology to keep your inventory fresh and appealing to consumers.

List of software, tools and supplies needed to start a sex toys business:

  • Online store platform for hosting the business - $100/month
  • Payment gateway for online checkout - $0.25 per transaction + 2.9% of amount
  • Website design and creation - $500+
  • Shipping materials - $50/month
  • Product safety testing equipment - approx. $1000+
  • Packaging supplies - $10/package on average
  • Advertising and marketing budget - variable based on goals and amount spent
  • Inventory management system - $20/month
  • Customer relationship management software - around $50/month
  • Business insurance policy - usually around $200-400/year depending on location, type of coverage, etc.

9. Obtain business insurance for sex toys, if required.

Starting a sex toys business involves numerous steps to protect your enterprise and ensure its longevity. One crucial step is obtaining the right business insurance, which can safeguard against various risks. Here are some key considerations when seeking insurance for your sex toy business:

  • Liability Insurance: This can protect you from claims related to product defects, customer injuries, or other damages linked to the use of your products.
  • Product Liability Insurance: Especially important in this industry to cover any claims that arise from product malfunctions or health issues caused by your products.
  • Professional Liability Insurance: If you provide advice or consultation services, this can protect against claims of negligence or misrepresentation.
  • Property Insurance: This protects your inventory, equipment, and physical space from theft, damage, or natural disasters.
  • Cyber Liability Insurance: Since many sex toy businesses operate online, this insurance can help protect against data breaches and cyber-attacks.
  • Check Local Regulations: Ensure you are aware of any specific insurance requirements or regulations in your area regarding the sale of adult products.
  • Consult with an Insurance Broker: A broker experienced in the adult industry can provide personalized advice to meet your specific business needs.
>> MORE:

10. Begin marketing your sex toys services.

Starting a sex toys business requires not just having great products but also effectively marketing them to reach the right audience. Here are some pivotal steps to begin marketing your sex toys services, ensuring they are presented tastefully, ethically, and in compliance with all regulations.

  • Understand Your Audience: Research and define your target market. Know their preferences, behaviors, and where they usually hang out online and offline.
  • Build a Strong Online Presence: Create a professional and user-friendly website, and engage with customers via social media platforms tailored to your audience, like Instagram, Twitter, and Reddit.
  • Email Marketing: Develop a subscription-based newsletter with product updates, promotions, and sexual wellness tips to keep your audience engaged.
  • SEO Optimization: Use search engine optimization techniques to ensure your website ranks high in search results for relevant keywords.
  • Content Marketing: Publish informative and educational content that helps destigmatize sex toys and promotes sexual wellness.
  • Collaborate with Influencers: Partner with influencers and bloggers who can authentically represent your brand and reach a larger audience.
  • Advertisements: Run targeted ads while adhering to the advertising policies of different platforms.
  • Discreet Packaging: Promote discreet packaging and shipping options to assure privacy-conscious consumers.
>> MORE:

What licenses and permits are needed to run a sex toys business?

  • Online store platform for hosting the business - $100/month
  • Payment gateway for online checkout - $0.25 per transaction + 2.9% of amount
  • Website design and creation - $500+
  • Shipping materials - $50/month
  • Product safety testing equipment - approx. $1000+
  • Packaging supplies - $10/package on average
  • Advertising and marketing budget - variable based on goals and amount spent
  • Inventory management system - $20/month
  • Customer relationship management software - around $50/month
  • Business insurance policy - usually around $200-400/year depending on location, type of coverage, etc.

11. Expand your sex toys business.

Once you've established your sex toys business and have a steady customer base, it's time to think about expansion to solidify your market presence and increase profitability. Consider the following strategies to grow your business effectively:

  • Introduce new products by staying abreast of the latest trends and innovations in the sex toy industry to keep your inventory fresh and exciting.
  • Expand your online presence through SEO optimization, engaging social media campaigns, and partnering with influencers to reach a broader audience.
  • Collaborate with other businesses in the adult industry for cross-promotions or to create exclusive product lines.
  • Consider international shipping options to cater to customers outside your current geographic market.
  • Explore wholesale opportunities to supply your products to other retailers and expand your brand's reach.
  • Offer workshops or educational content to build a community around your brand and empower your customers with knowledge about sexual wellness.
  • Utilize customer feedback to improve your product offerings and customer service, ensuring repeat business and positive word-of-mouth.