You have what you think is a great idea for a women’s clothing store. You’re ready to move your dream from your heart and head to reality. Where do you start?
First define what kind of clothing you want to sell. Is it going to be high-end designer fashions, moderate-priced active wear or a combination of these? Who is your target consumer and where does she live?
For brick and mortar stores, location is critical. Find a location that your potential client can get to easily, that has parking and is an area that shoppers frequent with other clothing stores open. You’ll benefit from the foot traffic from competitors whose customers take notice of you.
“Most women do not want to make more than two turns off a highway,” said Diane Lloyde Roth, who has owned the retail boutique L'Armoire for 30 years.
The next step is to do a business plan. What are the fixed costs? What can you expect to pay for rent, payroll, insurance and utilities, for example? What are the variable ones: Inventory, shipping, paper goods, credit card charges? What do you need to sell monthly to cover your costs and what margins do you need to have to be running in the black? What is the amount that you need to put up to get the business going?
“Be realistic and know that you can lose it all,” Lloyde Roth said.
Determine your clothing and its look. Do you want a ladies’ suit business, casual or another type of apparel? How do you stack up against the competition? Are you too similar? Do your homework so you’ll know how you can get exclusives and find lines no one else has.
“You need to define your business so that it is special,” Lloyde Roth said.
Lloyde Roth advised new business owners to start thinking about local charities that have members that would be the target clientele, and host a benefit party for them. Plan now what local events you can generate gift certificates to, once you’re up and running.
Look within. Are you really ready to start a ladies’ garment shop? It’s about sacrifice, on just about every level imaginable. Be honest about your personal finances. If you’re deep in debt or have a poor credit history, creditors and investors will be hard pressed to overlook that fact. Assess whether you have family and friends who would be willing and able to put up financial support to get your business off the ground.
“Before you produce any inventory, my No. 1 piece of advice is to test the market,” said Shannon Lohr, founder of Market45.co, a marketplace for ethical and sustainable fashion, that started two years ago.
The most effective way to do that is by preselling.
“Rather than risk tens of thousands of dollars in inventory that could sit in your warehouse, store or basement without ever being sold, preselling allows you to test the viability of your idea,” she said.
Whether it's through your own e-commerce store or a crowdfunding platform like Kickstarter, you can introduce your product to potential customers and presell orders that finance your production run for you. This also mitigates the risk of taking out a business loan, using your own savings or asking family and friends for money. By preselling, you are either proving that there is a market fit for your product(s) or eliminating the financial risk of having a product that no one actually wants, Lohr said.
The biggest mistake she sees in the lead up to preselling is the entrepreneur not building up an audience before launching presale orders.
“I recommend a minimum of six months, and closer to a year, to build an email list, grow your social media following and create momentum around your impending launch date. Without building anticipation about your product in advance of asking people to buy it, you're setting yourself up to fail. So rather than wasting time pitching venture capitalists (most who want to see $1 million in sales or 1 million in Instagram followers), spend your time connecting with potential customers, building a brand and growing an audience,” Lohr said.
There’s another way to test the market too for a ladies’ garment business.
“Start selling your designs on platforms that already have audiences such as Etsy or Amazon. Once you have data that suggests which designs are your high sellers and are making profit, you can start your own Shopify store or site and start driving your own traffic for the highest profit margins possible,” said Stacy Caprio, founder of Accelerated Growth Marketing.
Hire an attorney to negotiate your lease andset up a corporation for you so your assets are protected, Lloyde Roth said. What’s important when it comes to your lease? Lloyde Roth advised to go for a long-term lease that is broken up into 3- or 5-year options with fixed increases. You also want an open-ended sublet clause. Sign the lease and start putting the space together. Remember money put into the interior never comes back and you can’t sell it.
“The best way to go is to paint and carpet and get inexpensive fixtures that look great. Then start making contacts with vendors for your inventory. Try and get terms from them,” Lloyde Roth said.
Make sure you have a good support system around you – friends, family and mentors.
“You’ll want to give up, but stick to your vision and mission and keep going," said Sandra Thelusmond, founder of CEO of Vibrate Higher.
Sheryl Nance-Nash is a freelance writer specializing in personal finance and business. She was a former reporter for Money Magazine. Her work has appeared in Newsday, The New York Times, Forbes.com, DailyFinance, TheFiscalTimes, DealNews, Corporate Secretary, ABCNews, RD.com, among others. She is based in New York.
D, Sheryl. "How to Start a Women's Clothing Retail Business." Small Business - Chron.com, http://smallbusiness.chron.com/start-womens-clothing-retail-business-951.html. 10 December 2018.