You’ve got an idea for a new and refreshing fashion business that’s sure to take the market by storm. But you’re heard from somewhere that lots of new businesses barely make it past their first year – and lots more never quite make that leap into long-term sustainability. So what separates the long-term successes from the also-rans? Let’s take a look at a few crucial factors.
Securing Capital
Getting up and running often requires a solid foundation of capital upon which to build. This is especially so in the world of fashion, where building brand recognition is so critical to securing profitability in the long-term.
It can often be difficult to persuade high-street lenders to back a clothing brand. This is because the business is seen as inherently risky. Moreover, a layperson might have difficulty understanding why one clothing line might have potential that another lacks. Another problem stems from the inherent seasonality of fashion. A line of products from this year might be difficult to shift in twelve months time. Thus, if you fail to meet your sales targets, you’ll end up selling at reduced rates in order to offload the old stock. This is a recipe for poor profitability.
Fortunately, fashion start-ups needn’t rely entirely on high street lenders. There exists a raft of online alternatives, regulated by the FCA, which can provide the small business loans you need to get up and running.
Forecast Demand
Securing the capital won’t count for much if you don’t have an idea of what to produce, and in what quantity. The last thing you want to do is produce products that no-one wants. Since you don’t have an existing customer-base to gauge, you’ll have to get creative when it comes to market research. This is where crowdsourcing and social media reactions can be invaluable in informing your approach to product development at the outset of your new business.
Network with Reliable Manufacturers
Handling production in-house is something that few new fashion businesses do. It’s often far more cost-effective to outsource that aspect of your business to a manufacturer with the means to produce lots of clothes in a short space of time. Many such manufacturers have a minimum order quantity, which might make it difficult for you to get up and running; do your research before you put an order in, and don’t be afraid to switch manufacturers if you don’t like the results you’re getting.
