Starting your own brand can be the most exciting thing in the world. Designing your dream range, the prestige of selling your collections in renowned stores, the glamour of seeing your favourite film crush wearing your clothes and the pots of money to be made is surely very enticing. However, the reality of setting up shop will be something entirely different to your initial perceived idea.
Here are a few challenges in fashion business that entrepreneurs tend to overlook when setting up their business.
1. Positioning in Market and Differentiation
Of the many things to consider amongst the many, is whether your idea has a place in the market.
If it does then that’s great but if it is similar to many others out there how does it differentiate itself and appear unique?
It’s actually OK to be similar to something that already exists and is doing well, as that just proves its desirability.
However, to find customers and perhaps, persuade your competitor’s customers to buy your product, it needs to have the basic attributes as well as bells and whistles too.
If your idea is brand new and unique, then how do you define your market position?
Finding your place in the market is down to a number of things and the decision is yours.
Is your product aimed at a consumer who appreciates fast fashion or the mid or luxury sectors?
How expensive or cheap will your item be?
This will be based on whether it’s a fast fashion item or more suited to the luxury sector, in which case price (within reason) is no object.
2. Knowing Your Perfect Customer
Before you begin the lengthy process of finding customers, define your product or service from the customer’s point of view.
What does your product do for your ideal customer?
What problems does your product solve for your customer?
What needs of your customer does your product satisfy?
How does your product improve your customer’s life or work?
Defining and knowing your ideal customer will enable you to position your brand in the right place to attract the right people. This will determine your success in business.
So many entrepreneurs are unclear when it comes to who their ideal customer is.
They spend a lot of time looking for customers in the wrong place and trying to sell their product to people who are not their ideal customers.
The best way to find perfect customers and create new ones is by identifying your Unique Selling Point and communicating this key benefit to them.
Your ability to clearly define and focus in on the customers who can most rapidly buy your product or service will be essential to your business success.
If anyone has shown an interest in your products then try to find similar people within his or her demographic.
Create an ideal customer avatar questionnaire, with a selection of intrusive questions. Remember, you’re trying to find out the buying habits of your potential future fans. Where and how they shop? How many times a month or year they purchase items? What type of industry do they work in, which blogs interest them? Finally, which websites do they visit the most and what are their personal interests?
Successful businesses are built on the right foundations: Discover Your Perfect Client and Target Market today by attending the Fashion Insiders Masterclass.
3. Business and Financial Knowledge
Possessing some business acumen is paramount to launching a new brand. Before you launch, you will need a certain amount of finance to develop your product. This is almost a challenge in fashion business owner’s life majority of the time.
If you have access to savings or can call on family members or friends for help to cover costs, start there.
Remember to pay them back at some point. If, however, that isn’t the case you could consider setting up a crowdfunding campaign.
Crowdfunding enterprises enable you to raise funds from ‘investors’ who see potential in your products.
Check out this brilliant podcast about proven strategies for a successful crowdfunding campaign.
The entrepreneurial market is a real growth area and one that is gaining a foothold. For this reason, there are many funding opportunities available.
Other options for raising finances include grants and loans.
Grants are available through your local business enterprise office or try your local council. Virgin offers low-interest loans and the banks are reasonable with their financial packages.
The aforementioned options are viable but you will need to have a business plan to present. Without a plan, it will be harder to raise finance and to be taken seriously.
It doesn’t have to be a dense tome. Ensure that it has enough information that casts a light on your startup capital requirements, a profit and loss account and a cash flow forecast. Setting up a business account would be a canny move.
Prior to this do some research on the type of business you would like to run. Will you be a sole trader, or be entering into a partnership?
Perhaps you’d prefer to be a Limited company with appointed directors who can help you run the company. All the information regarding this can be found here.
With regards to pricing your products, a great approach is to work out how much you think you can sell your work for.
Once you determine a figure, work backwards by dividing it by six. This will give you a basic cost price which needs to include all of your material and manufacturing costs.
If your retail price is high, you will have more ‘spending’ money for your materials.
As in any business, it’s a good idea to determine your short, medium and long-term goals in regards to sales. It isn’t so easy to do especially if you haven’t had any experience of selling your product.
This information should ideally be included in your business plan in the Sales Forecast section.
4. Decision – Making Ability
Making important decisions for the good of your business should be a top priority. As a startup, you may find yourself having to deal with all aspects of the business and this can be overwhelming, to say the least. Focus on the following three things and try to stick to them:
Know all the facts regarding your company
By gathering all of the facts and information that impacts your business you won’t miss critical information that could make a difference to how you run your business.
For example, understanding how your competition is doing business is very important. Finding ways to improve customer satisfaction is another example of knowing the facts about your company.
Focus on the results
What do you want to achieve with the business? Once you’ve determined this, consider the possible outcomes.
Focus on short-term and long-term goals and keep looking for ways to improve how your company does business.
This will all lead to you accomplishing your business goals and mission statements.
Ask for help
It’s really important that you don’t get stressed with so much decision making. Consider the opinions of others and ask friends and your peers for advice.
5. The Right Method of Promoting Your Business
It is one thing to prepare your business or brand for the launch but the ‘beginning’ is not the ‘end’ of the story here. A smart business owner doesn’t overlook marketing and promotional elements required for his or her business.
Fashion Trade Shows, Social Media Marketing, Direct Selling, Advertising and Exhibitions are only a few of the many ways to promote or market your brand.
Nobody can guarantee what will work for you. You are the sole person who knows which trade shows (if any), which social media platform or advertising platform will be the correct method for you.
If you are keen on presenting your brand at a fashion trade show then keep these tips in mind.
However, you might want to rely on word-of-mouth first or piggy-backing on your existing network of friends and family.
Perhaps you are confused between Instagram and Pinterest.
Before you even start to produce your items, setting up a social media presence through Instagram, Twitter or Pinterest would be a good idea. By creating interesting content, that relates to your USP you will start the slow process of finding people who like what you do.
Designing your collection and progressing its development are important decisions that you will need to make.
Are you able to design or do you need help in turning that idea into something viable that a pattern cutter and machinist will understand?
Are you able to add the necessary details to your original ideas? This is a requirement if you want them developed into a pattern and then a sample.
The changeable world of fashion is not an easy one and overnight success stories rarely happen. Building something worthwhile takes time and a lot of hard work and determination. There is a lot of support out there for start-ups, so look for platforms and groups that want to help. Regard this race as a marathon and take it at a moderate pace. If your business is run well, anything is possible.
What challenges are you currently facing with regards to your business? Share with us below.
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