Fashion Design - How ToI receive questions from people quite often about business advice that I can give them. I decided that it is probably best to just summarize it here as briefly as I can and maybe provide a list, like a table of contents, that would serve as a template for those that are starting out.
One of the most important things to do before starting a business is writing a business plan.
A business plan is usually used to get a loan from a bank, it doesn't just talk about what you want to do, it has to be written like a research paper that proves to the bank why they should give you money, and provide proof that you will be successful and proof that you will repay them (with interest).
But, even if you are not looking to get a loan...
A business plan is also good for helping you realize things you might not have thought about.That is why I think it is really important to write one anyway. The biggest part of running a business, is running a business. That includes research. So this is a good start!
Below I have written out a summary of things that you would naturally include in a business plan for a fashion business. These things are also great to consider before opening up a business license as a thought action plan. Feel free to copy and paste these into a word document and to use these as a template for a business plan! Remember, depending on your company differentiation, you might want to add some categories.
- Company name, logo, date founded
- Summary of team that is part of the business and their roles
- You will go into more detail proving why this team will help your business later.
- Nice to include photos and contact information
- Company information (basic summary of what you plan to do) and a brief summary of your company history
- Company motto and mission statement
- Company deep dives (In great detail you will be describing your company)
- Product (You will need to know exactly what types of products you plan to make and describe these. I recommend having collection sketches with fabric swatches and a cost sheet done for each garment)
- Why product will sell (What makes your product special and why should people want your product)
- Branding (Describe your brand, your lifestyle image of your product)
- Short term business goals and how you plan to achieve them
- Long term business goals and how you plan to achieve them
- Resources (What resources you will need in order to produce, market and sell your product. You will get into more detail on these specifics later, so a summary will suffice before the bullet points. I recommend listing all items out first and then doing deep dives)
- Woven labels (describe woven labels and attachment method, images included of design with measurements and color codes. List out place where you will manufacture these and why that is the most cost effective place)
- You will need to make sure you follow all legal regulations for tagging garments for sale
- Hang tags (describe hang tags,images included of design with measurements and color codes. List out place where you will manufacture these and why that is the most cost effective place)
- Packaging (describe how you will package and deliver your product and where the distribution happens from. Describe the packaging design, images included of design with measurements and color codes. List out place where you will manufacture these and why that is the most cost effective place)
- Tagging (describe the tagging method for hang tags, images included of design with measurements and color codes. List out place where you will manufacture these and why that is the most cost effective place)
- Labeling(describe your labeling process and design and methodology, images included of design with measurements and color codes. List out place where you will manufacture these and why that is the most cost effective place)
- Where you will get all materials, who will do the sourcing for trim, findings, fabric etc. How they will help sell your product. (Don't forget to follow all laws and regulations for labeling fabric content)
- Cut and sew contractors
- You will need to describe what form of production you will undertake for the estimated quantity of product you plan to produce, how it will be produced and who you are hiring. You will need to describe why you are hiring that specific cut and sew contractor and prove that that is the best decision for your business.
- Location of production
- Location of packaging and product distribution
- Cost of production (How much it will cost to produce each of those in bulk, how quantity affects cost)
- Timelines and time expectations for production, tagging, and delivery
- Market analysis (This is incredibly important to your business)
- Demographics (Target Market and why)
- Geographical (where you are selling and why)
- Market entry (really important to think about this)
- Barriers to entry (really important to think about this)
- Marketing and advertising (you will need to IN GREAT LENGTH describe HOW you intend to advertise and market your product.)
- Look books
- Trade Shows
- Print and video advertising (Where you will place print ads and how much that will cost is important to include and look into)
- Sell through and building demand (if these two things don't happen your business will surely fail)
- Ways to build brand awareness and demand
- Forecasting and research
- If you are designing trend driven garments that are not part of a niche group you will need to prove how you know you garments will sell (otherwise you will spend money on bulk that just collects dust at home or never sells out to made to order). So you need to describe in great detail what kind of business consultation/ publicist you will have and how you plan to do trend forecasting.
- Competitor analysis (can't stress enough how important it is to pick out 3-4 competitors that make the same product you do and do the following for each of them)
- Competitor demographics and product analysis
- Competitor market entry
- Competitor market share and expansion
- Competitor advertising
- Company differentiation (Really Important! This is about you!)
- Management team
- All the people that are part of the company, their history and why they will help you be successful
- It is helpful to create a list of job roles that will need to be filled to make your business successful first, and then describe how those roles will be fullfilled and distributed.
- Financial analysis - Costs and Expenditures
- How much everything will cost you to make/produce per garment, in total, and over time
- How much you will need to pay employees in a year over the time you described in your expansion plan.
- Keep in mind taxes and other government fees
- Include website and advertising costs
- Don't forget manufacturing overhead and other investments in assets
- Financial projections
- Monthly and yearly based on REAL ESTIMATES in order to prove that you can cover your costs and expenditures over time.
- Loan proposal ( How much you will need, why you need that much, what it will cover and where the money will go)
- Loan repayment plan
- Monthly and yearly (Don't forget to count interest rate!)
And that sums up the business plan summary. Hope this helps you in your business ventures and gets you to think about how to be successful.
Let me know your thoughts!