Start A Clothing Line: The Business of Starting and Running Your Own Clothing Company

START

A

CLOTHING

LINE

The Business of Starting and Running Your Own Clothing Company

Nina Mandelson

With so much to cover on starting a business, if you‘ve ever had the intention of taking your hobby a step further, but lacked the business knowledge to go beyond sewing, or screen printing for yourself, then look no further than this book.

- Alt Fashion magazine

Author: Nina Mandelson

Producer: Tim Clarke

Project Team: Evie Clarke

ISBN no: 9781311569950

Version: 2.3

Published by: Cultmedia,

86-90 Paul Street, London, EC2A 4NE, UK

Second Edition: First published 2009

Copyright: © 2015 CULTIMEDIA All Rights Reserved

No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning or otherwise without either the prior written permission of the publisher.

The author and the publisher have taken care in the preparation of this book, but make no expressed or implied warranty of any kind and assume no responsibility for errors or omissions. No liability is assumed for incidental or consequential damages in connection with or arising out of the use of the information published.

Table Of Contents

Before You Get Started

How much does it cost?

The business plan

Why you need a business plan

Define your business

Understand the market

Defining your products

Develop a going to market strategy

Create an operating plan

Are you going to make money?

The SWOT analysis

Writing the business plan

The structure of a business plan

Your workspace

Studio space versus working from home

Incubation units

Setting up your business

Doing it alone

Partnerships

Your brand incorporated

A little bit on finance

Getting your Cash flow in order

Loans and investments

Researching and Planning

Your target market

Who is going to wear your clothing?

Identifying the market area

Price point definitions

Knowing your customers inside out

Gathering information on your customers

Undertaking a customer analysis

Building a customer profile

Customer questions you should answer

Your Competitors

Who are your competitors

Identifying your direct competitors

Important competitor questions you should answer

Analyze your direct competitors

Measure how you compare

Planning the year ahead

Working in season

The design calendar

Creating your calendar

Product Development

Creating your brand

What is branding

The elements of a brand

Analyzing brands

Developing your own brand

Key areas to consider in a brand

How you want your brand to be viewed

Choosing a brand name

Creating a logo

Creating an overall theme

Creating your identity

Working with a designer

Protecting your brand

Identifying your brands space in the market

What is a USP

Positioning yourself

The positioning statement

The Design Process

Future trend predictions

Design planning

How are ranges planned by designers

The product mix

Product mix strategy

Outsourcing for design

Design in-house or outsource

Finding a designer

Creating a style guide

Sampling your products

What is a sample

Why you need samples

Where to get samples made

Design protection and copyright

Understanding intellectual property

Design rights

Registered design

How to register your designs

Unregistered intellectual property

Protecting yourself with unregistered design

Self copyright

Trademarks

Non-disclosure agreements

Non-disclosure example

Promoting Yourself

Marketing

What is marketing

Why you need marketing

The three elements of marketing promotion

The marketing mix

Types of promotion

Above the line and below the line

Creating a company profile

What is a company profile

The key contents in your profile

Writing your company profile

Advertising

What is advertising

Types of advertising

Brand awareness versus direct response advertising

Do you need to advertise?

Creating your advertisement

Eliminating noise

Understanding where to place your advertising

Testing and measuring response

Public Relations

Press release

What your press release should say

Writing a press release

Sending out your press release

Your Online Presence

Why you need a website

Selling online

Leveraging social media

Email marketing

Digital brochures

Trade shows

What is a trade show

Choosing a show

Setting your goals

What to consider before booking a show

Budgeting for your trade show

Planning your stand

What to do at the trade show

What to do after the trade show

Selling Your Product

Distribution Channels

What is a distribution channel?

Types of distribution channels

Levels of distribution channels

Choosing distribution channels

The retail hit list

Where to sell your clothing

How to find stores

Creating your retail hit list

The store analysis

Which stores are suitable for your products

Undertaking a store analysis

Creating a look book

What is a look book?

How you should present your look book

Preparing to approach the buyer

pre-sales promotion

Pre-approaching the buyer

What you need to know about your company

What you need to know about the buyer

What to do before approaching the buyer

Understand how a buyer works

Understand the buyer

Why a buyer might choose your product

Making the call

Approaching the buyer

How to deliver your pitch

What to do after the call

The Meeting

Meeting the buyer

What to do before the meeting

What to do in the meeting

Closing the deal

Why must you close the deal?

Ways to close the deal

Why people might say yes

When you should close

Handling objection

Why people might say no

The 'I want to think about it' excuse

After you have the order

The order form

Creating an order form

Using an agent

How sales agents work

Advantages of using an agent

Disadvantages of using an agent

How to find an agent

Working with agents

Production Management

Sourcing materials

Planning your production

How are materials sourced

The supply chain

Lead times

Minimum orders

Working around minimum orders

Ethical supply chains

Production routes

What is a production route?

In-house production

Outworkers

Specialist CMT units

Screen printers

Contract manufacturing

Mass producing your clothing

Choosing a factory

Key questions to ask a CMT unit

Key questions to ask a screen printers

Key questions to ask a factory

Basic factory evaluation checklist

Writing a manufacturing agreement

Production and management techniques

The critical path analysis

Managing a critical path

Quality Control

Quality control checklist

Creating specifications

The spec sheet

Details to give a factory

Details to give a screen printers

Common delivery terms and what they mean

Preparing goods for retail

Pricing garments

Care labels

Care label exemptions

Swing Tags

Packing and packaging

What’s next?

What to do next

Tips for starting a clothing line

About this book

This book is about the business of starting and running your own fashion business. It does not teach you how to sow, design or make patterns, but instead gives you the invaluable knowledge of how to take those skills and create a viable business in the fashion industry. No matter how talented you are as a clothing designer, if you do not understand how the business of fashion works and the process taken working alongside the industry, then you will be doomed to fail before you even begin.

Don’t worry though, by picking up this book and beginning to read, you have taken the first step in building your own fashion brand and selling your clothing to retail stores. This book will arm you with the knowledge that you need to be successful and create something truly amazing. I will take you through the process step by step, also giving you insight and advice from my own experiences of building a brand and starting a clothing line.

This is your crash course, a no nonsense straight to the point guide which can be read from beginning to end or used as a reference. It is your manual to success in the clothing industry, giving you foresight to common pitfalls and mistakes made by designers stumbling into the world of fashion.

The book is separated into six section which are the major steps you will take in order to take your ideas from conception to production and retail.

The first section of the book titled ‘before you get started’ outlines a number of items to understand and consider before you dive into the nitty gritty of building your business. It is areas of your business to think about before you begin getting into the real planning of your clothing label, thinking ahead of what you will need to consider and have in place. I talk about the costs involved in starting a business as well as giving an overview of the process. This section also weighs up the options that you have for your workplace and runs through what you will need to understand before you can create your business plan.

Section two titled ‘Researching and planning’ focuses on the planning stage of your business where you will understand your market and know your customers, as well as discovering your competitors and analyzing them. In this section we also take a look at the design calendar, planning the year ahead to work alongside the industry.

Section three, ‘Product Development’ takes you through the process of creating your product lines, from creating a brand through the product design process to sampling your garments. We discuss trend predictions and designing ranges, taking a look at design planning and the product mix. This section also looks at outsourcing for designs, positioning yourself within the market and how to protect your intellectual property.

Section four of the book titled ‘Promoting yourself’, discusses your marketing strategies and methods of promoting your brand. We look at different forms of advertising, as well as creating press releases and attending trade shows. This section also takes you through creating your own company profile that will form the basis of your promotional material.

Section five ‘Selling Your Product’ focuses on researching and analyzing the stores that you will sell to, as well as taking you step by step through the sales process. This section teaches you how to create your ‘retail hit list’ and approach the buyer with your designs. In this section we also discuss the pros and cons of using a sales agent as well as looking at distribution channels and discussing which are right for your business.

Section six of the book, titled ‘production management’, takes you through the process of producing your clothing and outlines the necessary steps that must be taken. It takes a look at sourcing materials and explains lead times and the supply chain. We take a look at production routs and discuss which rout is best for your business model. Also in this section we look at working with factories and preparing your clothing for retail. This section also goes into production management techniques to enable you to run your production as smoothly and efficiently as possible.

I hope that you enjoy reading this book as much as I enjoyed writing it, and that you get everything you need from it to start and build a successful clothing brand. Before you dive into the book, I want to wish all the best on your new venture. It is both frightening and exciting, but by following the guidelines in this book you can minimize the concerns and enjoy the excitement of starting and running your own clothing line.

Before You Get Started

Before we dive right into starting a clothing business, let us first take a look at areas that you may need to put into consideration or act upon before you can get it all started. In this section we are going to take a look at the financial side of starting your business, where you are going to work from and getting your business plan in order.

How much does it cost?

The most common questions asked by people who dream of running their own clothing line is what it will cost them financially to do so. The answer is that it depends. Unfortunately there is no simple and easy answer, and the truth is that it could cost you a minimal amount through to thousands or even millions of dollars. Everyone’s idea of what they want to do is different and the scale of different clothing designer’s plans can range from a small simple market stall to chain store branded clothing. Let us run through the different variables which will affect the initial capital and running costs that you will need to invest into your new venture.

Overhead costs

Your overhead costs are your fixed costs such as the bills that you pay to keep your business running. If you are planning on working on your clothing label full time, then this could also be living expenses and any wages that you pay to your staff. It could also be the costs in hiring freelancers, accountants and lawyers. If you plan on running your label from a studio then this could be rent and electricity. Your overhead cost will need to be factored into the cost of producing your garments. Divide the total overhead costs by the time taken, which would usually be over a season, with the amount of clothing produced which will be added to your production cost per unit.

If you are working out projections then you my need to anticipate the costs and figures, estimating the amount of garments you feel you will sell over the next few seasons and estimate the likely overhead costs involved. You may need to produce more than one set of projections, altering the variables to see which feels the most realistic. Start by creating a list of your potential overhead costs. If you don’t feel as though you can do this at this moment, come back to it after reading this book in its entirety.

Distribution channel

A distribution channel is by what means you are going to sell your clothing and how your customers will get access your products. The three main distribution channels are wholesale, retail or through an agent.

Wholesale is when you sell your garments to another business who in turn sell the garments to customers or another business. If you are selling your clothing in bulk to stores you will take the orders first before producing the clothing. In this scenario you will need to fund the orders first and so a balance must be managed between the quantity of orders and what your budget can afford. Often, ambitious startups can run into trouble early on by taking too many orders initially or growing too fast. On the opposite end of the spectrum, you will also need enough orders to cover costs and make a profit, and so a healthy balance is the key.

Retail is when you sell your clothing directly to the end users, which could be through a market stall, an online store, a catalogue, your own physical store or a mix of each. When creating products for direct sales, you must decide on the quantities and options of garments that you believe that you can sell, or which you can afford, and produce them first before selling. In this scenario, as you are not selling in bulk, your financial return will come slowly over time as you sell the garments, as opposed to receiving a bulk payment from another business. A major risk in retailing your own clothing is that your assets can be tied up in stock if you are too slow to sell your clothing, which can cause problems with cash flow.

It should also be noted that the size of orders from manufactures will greatly affect the initial and running costs of your business. The larger the order, the less cost per unit they are to produce and the more profit gained long term, but the more finance that must be invested initially on production, sales and marketing.

Agents are a middle man between your business to business sales, such as selling your clothing to stores. The benefits of using agents in addition to their sales skills is the network and trusting relationships that they have already built with retailers. However, the downside is the commission taken by agents which must be factored into your financials.

Production routes

A production route is how you are going to get your clothing manufactured, which is dependent entirely on your own business model and the types of clothing or accessories that you are producing. There are a number of options available to you with varying cost, suitability and risk factors involved which can range from manufacturing your clothing in-house to mass factory production of garments internationally.

In general, producing locally will cost more per unit but will have less minimums and less risk associated with it. Producing abroad will be much cheaper per unit but with a much higher minimum order, which means you will need to sell more and invest more initially but get a greater return.