The subscription box market size is expected to reach $64.1 million by 2027. The demand for these services has never been greater.

If you’re considering joining the ranks of subscription e-commerce businesses like Burn Box – which has scaled to a monthly recurring revenue (MRR) of $130K – you need to plan and execute a bulletproof strategy.

All successful subscription box businesses have to start somewhere. This guide covers everything from your first day as an entrepreneur to launching your subscription box business.

There are a wide variety of benefits for entrepreneurs starting subscription box businesses. Here are four important ones: 

Recurring revenue: This model generates a recurring and stable income stream.

✅ Scalability: Once you have a successful service with a solid subscription base, you can easily increase your subscriber numbers through marketing and referrals.

✅ Inventory management: A subscription model means you can accurately predict your inventory needs, which can help you manage costs more efficiently.

✅ Higher lifetime value: Because customers spend more through a recurring subscription, the revenue you generate per customer is higher than it would be in other business models.

✅ Higher multiples: Due to its recurring revenue model, investors and buyers will likely value it with a higher multiple when you sell shares or exit your business. 

If these advantages sound good, you’re probably wondering how to start a subscription box business.

Let’s dive in and get started on your own subscription box. We’ve broken it down into an easy five-step process:

The quick version: Your idea is the foundation of your business.

The first thing you need to do is decide what type of subscription box you will sell. You can choose one of the more popular subscription box categories or select something highly unique.

Popular subscription box niches

Your first option is to select items that are already popular, thanks to existing subscription boxes. The graph below shows the most popular types of subscription boxes:

If you choose a popular category, the challenge you face is that the market is already saturated. 

For example, there are hundreds of food and meal kit boxes already out there.

This means you may have a harder time competing with other businesses for subscribers. This is where you may want to lower the price of your box to entice new subscribers.

On the upside, if you choose a popular type of box, it should be relatively easy and affordable to source products to include. For example, if you choose beauty, you can buy these items from wholesale suppliers at a relatively low price.

Specific subscription box niches

There are several benefits of niching down and curating a truly unique box. 

Firstly, you won’t be competing with a massive market to sell your boxes as there’ll likely only be a few available in your niche. You’ll also be able to charge more per box because subscribers can’t find these products as part of a subscription elsewhere.

Additionally, although the demand for your products may be lower due to their specificity, you’ll have access to an untapped audience to sell to.

However, the downside to choosing highly niche products to include in your box is that these items could be more expensive to source. 

The best niche subscription boxes are those that are based on your own passions or needs. You can directly translate this into the products you offer in your boxes. 

For example, if caring for your dog is extremely important to you, this can help you choose products for your pet-related box that other dog owners will appreciate.

💡 Need more help figuring out which products to sell? Have a look at our in-depth guide on choosing products for subscription boxes!

Understanding your competitors

Whether you’re going with a more popular type of subscription box or choosing a highly specific niche, you need to know who your competitors are.

Without knowing who you’re competing against, how will you ensure subscribers choose your product over a competitor?

Spend some time researching the competitors that are already selling your idea and find out:

  • How many boxes you’re competing with?
  • What do these subscription boxes offer, and at what price?

From there, you can start thinking about how you can differentiate your subscription box from your competitors to stand out.

The quick version: Leave no stone unturned when it comes to planning.

Once you’ve chosen a model, it’s time to move on to the planning phase of your own subscription business. 

Behind every successful launch is a solid plan. It’s a key part of building a strong foundation for success.

If you’re starting a new business idea from scratch, keep reading. Or you can check out our guide to adding subscriptions to an existing business.

Creating a business plan

All successful businesses start with a comprehensive plan. Here’s an overview of the key elements of any solid subscription business plan:

An executive summary

This is the introduction to your business plan, and it includes your business name, mission statement, a description of your offering, and an overview of all the following sections. It’s easiest to write this after you’ve finished all the other steps.

Problem and solution

You need to be clear about the exact problems that your subscription box services solve for your target customers. 

This is the foundation you need for your promotional and marketing efforts. 

Being able to solve a customer’s pain points is a fast way to sell your subscription boxes as you’re generating a demand.

Your target audience

You need to spend time plotting out your ideal customer profile (ICP). Who is your audience? You won’t be able to land subscribers without knowing exactly who they are. 

Create a breakdown that includes your ICP’s age, location, income bracket, education, profession, lifestyle, and any other relevant demographics.

Your value proposition

A value proposition is typically a short statement that describes the value of your product or services, why people need it, and how it differs from your competitors. 

This is the backbone of your marketing messaging and will inform how you promote your box.

A competitor analysis

Now that you know who your target audience is and how you can help them, it’s time to find other brands that offer a similar product. 

Next, you need to analyze how successfully they’re selling their subscription box and what you can do better.

Pricing strategy

It’s a good idea to start with a cost breakdown of everything involved in creating and delivering your subscription box. 

This includes:

  • The cost of goods sold (COGS).
  • Packing costs.
  • Shipping and handling costs.
  • Transaction fees.

Having a clear overview of your costs will inform how you price your subscription box to cover all your expenses and make a profit. We’ll tell you more about pricing your subscription boxes later in this article.

A sales and marketing framework 

You’ll need to identify the most important marketing channels to promote your offering, from search engine optimization (SEO) to email marketing. 

You may also want to consider influencer marketing and initiatives to encourage the creation of user-generated content.

Later in this article, we’ll discuss how you can effectively market your new subscription box business.

Your team

Whether you’re running your business solo, have a full-time team, or are somewhere in the middle, make sure you detail all the people involved in your operation and what their roles are.

It might be helpful to use your business plan to outline what the key performance indicators (KPIs) are going to be for each person within your business.

Potential risks

As explained above, regardless of which business model you choose, there are risks and challenges involved.

Creating a business plan will help you consider these risks and what your strategy will be should things not go as planned.

For example, retaining subscribers can be challenging. How are you going to handle things when people unsubscribe to your box?

Your financial plan

A business plan is also an opportunity to create a financial outline. Your plan should include:

  • Your sales and revenue forecasts.
  • Expenses.
  • A cash flow statement.
  • A break-even analysis.
  • Your tax breakdown.

Source: Subbly competitor benchmarking

Sourcing products for subscription boxes

Once you have a business plan in place, it’s time to think about how you’re going to source products for your subscription. Here’s what you need to plan for:

What are you going to sell?

To get a solid grip on your product procurement strategy, find out what your target market wants. 

What stories will resonate with them, and what can you do to improve existing opportunities in your niche?

Where are you going to find items?

Where are you going to find these products? From Etsy to eBay and even Instagram, there are plenty of places for you to find high-quality suppliers for your subscription products.

💡 Get Inspired

If you’ve decided on the general subscription box theme you’re going for and are looking for some inspiration, browse through some of our favorite examples of subscription box ideas.

Considering your product packaging

The physical packaging of your subscription box is important for two reasons.

First, your packaging directly reflects your brand’s attention to detail. Keeping everything aligned with your brand identity is key. The unboxing experience is a particularly important touchpoint in this regard – more on this later.

Secondly, the quality of your packaging will affect the condition your products will arrive in when they’re delivered.

You may want to consider custom packaging as a way to showcase your brand and ensure that everything gets to its destination intact and in its original condition.

💡 Top Tip
Don't forget to order a prototype box just to make sure everything looks good when it arrives at your own doorstep—aesthetics and product integrity are hugely important in the subscription box industry.

Pricing your subscription offering

Pricing your subscription box service is tricky. Start by choosing a pricing model that suits your business. Here are two to consider:

Fixed pricing

This kind of pricing means you’ll have one box type with a predefined selection of products at a fixed price, often charged on a monthly subscription fee basis. 

It’s the easiest pricing model to start off with and gives you more time to focus on other important early-stage aspects of your business, like customer acquisition.

Here’s what setting up fixed pricing looks like on Subbly:

Tiered pricing

Tiered pricing means you’ll offer multiple types of subscription boxes with different selections of products at varying price points. 

While this is a bit more complex to set up and manage, tiered pricing is a great way to meet a diverse range of needs and cater to a wider range of customers.

This is how you would set up tiered pricing on Subbly:

In terms of margin, try to aim for around 50%.

“I didn’t understand entirely how expensive tools and gear actually were. The biggest challenge is getting the products for the right price, especially as the smaller businesses we work with often have to charge high prices themselves just to make slim margins. This makes it harder to source enough products for a satisfying box.”
Thomas Ansu
Thomas Ansu, Founder of $130k MRR subscription company Burn Box

Setting your goals

Now is the time to determine what the main goals for your business are going to be. If you want to run a successful business, your goals should be:

  • Landing conversions: This is turning prospective customers into paying subscribers.
  • Retaining your customers long-term: It’s important to retain your customers by keeping them happy. Acquiring new subscribers is far more expensive than pleasing your existing customers.
  • Focusing on customer experience: Deliver the perfect customer experience to delight your subscribers. This experience starts with them discovering your product and extends to them receiving their box.
  • Becoming an everyday product or service in households: This is how you lower customer churn and ensure your subscription box is always in demand.

Successfully selling subscriptions involves finding the perfect balance between product, value, and pricing.

Once you’ve achieved these objectives, you’ll be able to scale your service exponentially and get the recurring revenue you need for a thriving subscription business.

The quick version: start things off on the right foot when it comes to the e-commerce platform you choose, website creation, shipping, and billing.

The next key step to starting a subscription box business is setting up your operations.

This entails everything from choosing a subscription box platform, setting up a website and online store, and planning logistics around customer convenience. 

The more thought you put into how you set all this up, the easier it’ll be to scale once your loyal customer base has started to grow. 

Remember, it’s best to use a platform designed for your business model. Check out the differences between different subscription e-commerce solutions to help make your choice.

Choose an e-commerce platform

Simplicity is the main thing you should look for in a subscription e-commerce platform. Of course, it should also be designed for your unique model, but ensure that the platform you choose:

  • Is built to scale and doesn’t charge you per subscriber.
  • Is secure, reliable, and frequently updated.
  • Allows you to do as much as possible in one place rather than requiring plugins for core functionality. 

Here are some of the 100+ features you get when signing up with Subbly:

Some of Subbly’s 100+ subscription-first features

Here’s what one of our merchants had to say about choosing us over her previous solution.

“It was easy to migrate to Subbly from a WordPress site powered by Shopify and Bold, and it’s been great so far – our MRR is already up 13%! – Jill Lodato, Founder of Kids Baking Club

Check out our guide on choosing the right e-commerce platform to help you make your decision.

Set up your website

There are many ways to set up a subscription box website, but if you’re not a coder, your process will probably look a lot like this:

  1. Choose a website template: It should be easy for users to navigate and feature a simple design that avoids clutter.
  2. Create a logo, or upload your own: Your logo should make it easy for consumers to spot your brand from a mile away. This is the foundation of your brand identity, so choose wisely.
  3. Create your marketing copy: You may want to hire a freelance copywriter on Upwork or Fiverr to help you with this part. Getting your marketing messaging right is crucial to the success of your business.
  4. Insert visual assets: This is how you add some flair to your website and help you create and maintain a cohesive brand identity.
  5. Tweak the colour scheme: It should align with your brand identity and be easy on the eyes.
  6. Launch your website: Once your website has gone live, you can come back and spend time refining it based on customer feedback and your analytics.

Here’s an optimized subscription website template from the Subbly collection:

For some more tips on site optimization, check out Subbly Expert Alex Fleck’s webinar featuring five conversion hacks for your subscription box website.

Establish your shipping and fulfillment

Shipping and fulfillment are important parts of your subscription box service. Together, they refer to the process by which your subscription boxes are assembled and shipped from the warehouse – or your garage – to your subscribers’ doors.

For subscribers, it’s about the process of managing, tracking, and receiving their orders. 

Transparent, two-way communication is vital here, as is making sure all packages are shipped both on time and in good condition. It’s also important to think about how you’d process returns.

We’ve got a full guide to logistics and shipping that you can read to help you set up these processes.

🔥 Pro Tip from Jill Lodato – Kids Baking Club Founder & Subbly Expert User

In the U.S., boxes 13 oz and under ship first class. Anything over 13 oz will add another $3 to the base price. If you can strategically optimize your packaging to weigh 13 oz or less, the savings will add up quickly!

Fulfillment involves the stage between receiving your products from suppliers and packing them into boxes before they’re handed off for shipping. It’s a process that can either be done in-house or get outsourced:


This would mean you do everything yourself. For many subscription businesses, this is useful when starting out. 

You’ll get an in-depth look at every aspect of the process and directly oversee quality control while achieving significant cost savings.


Outsourcing means you would pay someone else to handle your fulfillment. 

Fulfillment comes with its fair share of challenges and costs, such as liability insurance, cleaning the warehouse space, paying for labor, training employees, and ensuring quality control. 

If you manage to find a good shipping partner that you can trust, it’s a worthwhile investment.

💪 Pro tip from Ryan Culver – Founder: Platterful & Hempcrate 

Outsourcing your fulfillment to an experienced external provider used to shipping thousands of packages a day can also give you access to a relationship with a postal consolidator – which can save you $1-4 per package compared to USPS, UPS, or FedEx direct.

Here’s some more information on the fulfillment process, with a list of questions to ask potential fulfillment partners to save you time and help ensure they’re up to par.

Set up your billing process

The last part of this step is making sure your subscription billing framework is set up correctly.

Subscription billing is a process that allows merchants to automatically charge subscribers a pre-approved amount at certain intervals in return for their goods and services.

A good subscription billing framework is optimized to ensure every aspect of the customer journey related to transactions works as efficiently as possible. These aspects include:

  • The checkout process: This should be as smooth and simple as possible to ensure potential subscribers check out.
  • Dunning sequences: This is a sequence of emails or other forms of communication sent out if a subscription payment isn’t successfully processed. You’ll need to have this set up before you launch your business to ensure you don’t lose out on any revenue.
  • Account management: You need to ensure every aspect of each financial transaction is customer-friendly and that subscribers have a good experience making payments.
  • Analytics: Often built into your payment provider, this can provide you with data pertaining to your revenue and all the payments that have been made to you.
  • Revenue recognition: This is how your revenue is recorded and reported. The goal here is to ensure your revenue matches the number of deliveries of your subscription boxes.
  • Payment processor choice: You need to choose a payment processor that is easy for your customers to use so that they complete their payments hassle-free.

Here’s how Subbly allows you to select from a wide range of payment processors:

Subbly allows you to select from a wide range of payment processors.

💡 Top Tip

For the most flexibility, we recommend offering multiple payment gateways such as Stripe, PayPal, and Braintree.

The quick version: get creative with your marketing and promotion initiatives – the more engagement you can stoke before you launch, the better!

Now, it’s time to start thinking about marketing and promotion. This is key to customer acquisition, both in the initial stages and as your business grows.

As a new subscription business, there’s a lot to take into account before you launch, particularly when it comes to demonstrating sales intent and building an integrated business model.

There are a few things to consider at this point:

  • How do you attract new customers? How do you get potential customers excited to start a subscription?
  • What is your approach to marketing and promotion going to be? Will you use social media marketing campaigns, a unique landing page to build up your email list, or an excellent unboxing experience?

The philosophy that should guide your approach is summed up beautifully by this quote:

“The simplest truth of a subscription box is that to engineer real success, you need to create an offering that people 1) easily understand and 2) believe they strongly need in their lives. If you can crack those two elements, you have yourself a real business with incredible potential”
Alex Fleck
Alex Fleck, Subbly Expert

Now, let’s discuss how to make it happen.

Creating a subscription marketing plan

Your marketing strategy will help you achieve a number of goals as you grow your business:

  • Acquiring new subscribers (particularly important in the early stage).
  • Increasing brand awareness.
  • Combatting churn.
  • Maximizing your retention rate.

Here’s a quick framework to help you set up a plan:

Understand your audience

Similar to your business plan, your marketing strategy starts with understanding your ICP.

Get to know your customers and their purchasing journeys inside and out. You can do this by gathering data through direct interaction and surveys.

Here’s how you can use Subbly to run a pre-purchase survey to collect this data:

A pre-purchase survey can improve customization and data collection opportunities.

You can then use this knowledge to segment your customers, identify their pain points, and communicate your value proposition appropriately.

Optimize the shopping experience

Use your marketing messaging to highlight:

  • Upsell opportunities.
  • Gamification initiatives.
  • Free trials.
  • Annual discounts.
  • Transparent pricing.
  • Automatic renewals.

The easier and more enticing it is to convert and stay on board, the more likely potential subscribers are to follow through with their purchase.

You can use Subbly to set up enticing upsell opportunities and increase your revenue:

Set up enticing upsell opportunities can help you increase your revenue.

Communicate effectively

From crushing churn to promoting incentives for spreading the word, thoughtful, proactive, and value-driven communication is key to all of your campaigns.

You can do this by setting up automated email campaigns and providing excellent, accessible customer support.

You can use automation to save time while providing a personal touch with Subbly:

Automation can be used to save time while providing a personal touch.

For a full breakdown, check out our guide on how to set up a subscription marketing strategy.

Subscription marketing techniques

Here are three tried-and-tested bonus subscription marketing techniques to consider when you’re starting out. 

  • People love free stuff: Set up a free trial or a competition to win products in return for posts on social media platforms. Encourage people to post video content as their competition entry, as this format performs well on social media.
  • Back your box with a community: Building a community through interacting on forums and Q&A sites and growing your email list are effective ways to market your box. Consumers want to buy from credible and trustworthy brands, and creating a community helps you achieve this.
  • Create urgency: Consumers are driven to make purchases when they know time is running out. Optimize your new product launches to drive demand and maximize urgency.

Remember that iterating and experimenting with different techniques and strategies are the best ways to maximize return on investment (ROI).

Consider the unboxing experience

It’s a milestone when subscribers accept your offering when they find your website and sign up. But it doesn’t end there; another milestone is when they receive and unbox it and find it meets or exceeds their expectations.

The importance of the unboxing experience shouldn’t be underestimated. It’s a marketing communication channel in itself.

The first delivery – the grand reveal where they hold your products in their hands – will set the tone for the rest of their subscription journey. 

Five aspects of an unforgettable unboxing experience

Keep these in mind when you’re reviewing your prototype box – there’s plenty more to explore on product unboxing once you’re ready, but don’t leave it too late.

  1. Your box should contain high-quality items.
  2. Your packaging materials should be of a high standard and be well designed.
  3. Create an intuitive unboxing process, which includes opening the box and removing your products from the packaging.
  4. Personalize your packaging by including the recipient’s name or other information you have about them.
  5. Strategically place calls to action (CTAs) to elicit user-generated content.

Here’s an example of a quite adorable unboxing video from one of our users, BusterBox:

Communicating with your customers

For a subscription service, the customer journey ideally never ends. This means you have an almost unlimited number of touchpoints and channels to communicate through:

Transactional emails

Maximize deliverability and engagement with well-crafted subject lines and preview text, human sender names, and personalization, among other email best practices. Experiment with:

  1. Weekly or monthly updates for existing customers.
  2. Welcome and onboarding emails.
  3. Unsubscribe emails.
  4. Order and shipping-related emails.
  5. Checkout confirmation emails.
  6. Any requests for testimonials, reviews, or other personal insights.

Thank-you notes

Saying thank you is just as important in the business world as it is in the personal world. 

Subscribers love it when you highlight your appreciation – it delights them. To write the perfect thank-you letter:

  • Use subscribers’ first names.
  • Explain why you’re reaching out to them.
  • Add specific details about their purchase.
  • Reiterate your gratitude.
  • Sign off with your name – and perhaps even a personalized offer for their next order.

Customer feedback requests

If you don’t know what your customers are thinking, it’ll be harder to customize your offering based on their needs. 

Reaching out to them personally via email, SMS, and phone is key to getting that all-powerful insight.

As Subbly merchant VinoMojo experienced, it wasn’t easy to grow a community of members at the beginning when their product was still in its early stages. Asking the right questions, however, helped them bridge the gap.

”We were really pleased with our initial feedback, despite our rudimentary product. We thought this might be an issue for early adopters, but they were willing to put up with that as they knew they were getting great value. We worked on how we find and speak to our target audience too, and since, on top of more new subscribers, we’ve even seen an increase in member referrals.”
Tom Tryon
Tom Tryon, Co-Founder of VinoMojo

The quick version: counting down to liftoff is super exciting. Once you’ve launched, retention becomes of paramount importance, as does keeping a keen eye on your metrics across the board.

Once you’ve launched your subscription box or other model, other factors come into play. Are you ready to take the leap?

Preparing your pre-launch

The most basic form of a successful pre-launch campaign consists of three main elements:

  1. Creating a distinctive landing page: Keep your copy simple and CTAs clear. Ensure you include high-quality photos of your products and what the final box looks like to entice potential customers.
  2. Driving traffic to that landing page: Use social media channels and influencer marketing to start driving people to your website. You can also include links to your website in marketing emails to drive traffic to your site.
  3. Growing and nurturing your email list: Set up automated campaigns interspersed with some personalized outreach.

As your pre-launch campaign winds down, don’t lose momentum. Create urgency, keep posting on social media platforms, thank those who helped you, and make any last-minute tweaks.

Graphic showing average time to get a subscription business ready to start selling

Looking ahead: Metrics, forecasting, and reducing churn

Tracking your metrics is crucial once your subscription box service has been launched. 

What metrics and KPIs should you be tracking?

In a subscription context, some metrics are more important than others, and you probably don’t have time to track them all. A selective approach to subscription business analytics is key.

Subbly’s analytics dashboard is key to making sure you don’t miss a beat:

A clear dashboard is key to make sure you don’t miss a beat!

The most important subscription business metrics are those that indicate that you’re delighting your customers and that they’re converting fast, not churning, and becoming cheaper to attract and retain over time.

  1. Average Revenue Per Subscriber (ARPS): This is the total revenue divided by the total number of subscribers. Although this is similar to the more commonly used average revenue per user (ARPU), we feel it is important to make the distinction between subscribers and users.  
  2. Monthly Recurring Revenue (MRR): This is ARPU (calculated over one month) multiplied by the total subscribers (active in the same month).
  3. Customer Acquisition Cost (CAC): Divide the cost of sales plus the cost of marketing by the number of new subscribers in a specific time frame.
  4. Churn rate: This is the total cancellations in a given period divided by the number of subscribers at the beginning of the period, multiplied by 100 (percentage conversion).

Understanding revenue forecasting

The more data you collect and the more you optimize your offering accordingly, the better your results will be. This helps a lot when it comes to revenue forecasting. You’ll also need to calculate revenue recognition. 

Both of these are quite complex topics that are important to take into account as your business grows over time. To understand this fully, read our full guide on revenue forecasting.

Conquer customer churn from early on

Churn is one of your biggest challenges when it comes to growing a solid subscription business. Your churn rate is the number of subscribers you lose over a defined period of time.

This typically occurs in two ways:

  • Voluntary churn: Subscribers who make the active choice to unsubscribe from your offering.
  • Involuntary churn: Customers whose subscriptions end due to issues like declined credit cards or other circumstances beyond their control.

Losing a few subscribers might not feel like a big deal at the beginning, but it adds up over time. 

To reduce voluntary churn, reach out to your subscribers proactively (ideally personally) and find out what went wrong. 

At a minimum, set up surveys and automated emails asking them for feedback so you can keep your finger on the pulse. 

To reduce involuntary churn, assess your dunning process and associated communication flows and determine where to make the process smoother and easier to interact with.

The earlier you implement processes designed to reduce subscription churn, the easier it’ll be to achieve.

Top strategies for customer retention

It’s significantly cheaper to retain a customer than to acquire a new one. There are many subscriber retention strategies you can try out to keep your customers coming back for more boxes.

Some of them include:

  • Creating automated offers that trigger at specified subscriber drop-off points.
  • Communicating during and beyond the buying journey to maximize engagement.
  • Analyzing common points from cancellation surveys and adapting your offer accordingly.
  • Offering rewards and downgrade options to lower the subscription cost.
  • Making sure all the crucial parts of the billing process are communicated well in advance.
”Subbly has fantastic marketing features which keep improving, making acquisition increasingly efficient over time. Plus, since Subbly is a subscription-first platform, it has great features for maximizing customer lifetime value and reducing churn.”
“James, “Founder

Congratulations! You’ve made it to the end of our blueprint for how to start a subscription business. 

Each of the steps outlined above is easy when you use Subbly. Thousands of businesses are using our platform to run successful subscription box businesses.

With our tool, you don’t need to try and do it all yourself. Subbly is a subscription-first platform with everything you need to get your business started – no plugins necessary.

If you’d like to try Subbly out for yourself, sign up for a free two-week trial. We’re excited to join you on your journey to subscription box success!

By Zaki Gulamani
Editor-In-Chief at Subbly