Starting an apparel business may not be a good idea at this time!
Credit: Cornish College of the Arts
During the Pandemic we were contacted by start-ups that wanted to enter this space. They ranged from individual designers to teams. Their strategies for entering the market and to make their dreams come true ranged from “bespoke” suits to mass produced t-shirts. Several were inspired by STITCH FIX and their subscription model.
The market in the US is presently in excess of $ 186 Billion per year. With a TAM of that size, there are plenty of Entrepreneurs who want a slice of the pie. Barriers to entry are small and success stories can be found on every news feed.
In short, the odds are stacked against you in a very big way. The market per First Research is made up of 96,000 competitors and the 50 largest companies take $ 130 Billion of the revenue. That leaves an average of $ 583,000 in annual sales for the remaining 95,950 companies . If you want to be a Unicorn, this is probably not the best market for you to try.
On the other hand, if you have an idea that you believe in and you are in love with Fashion and Apparel then read on.
1. The biggest weakness is a too much reliance on E-Commerce. If you want to build a brand and a company, then consider starting with a brick and mortar store as your primary way to generate cash and awareness. Location will be important.
2. Finding a reliable supplier -somebody who is close and will do small runs. Inventory in a rapidly changing market needs to be very lean.
3.Know your market! Finding out what your target customer likes or hate is involves a lot more than just an age group. You will need to get into the nitty gritty details in order to really know what will sell. So take the time to create a detailed customer persona and take the time to do the research. This example came from Xtensio :
4. Create a website that focuses on drawing people to your store, while still allowing for E-Commerce. Using a template and platform like Shopify is economical and will serve the purpose until you are much larger.
5. Get a really good PR person to promote your company locally. You want to be featured in your local newspaper and on your local TV station.
6. Cross promote with local establishments that also cater to your market. Nightclubs, Country Clubs, Event Promoters – whatever fits your customer persona.
7. Money – there never is enough. As a rule of thumb, you want enough to cover all your expenses, including start-up cost to last 12 months.
8. Once you have a product for sale, make sure you talk to your customers. You want the good, the bad and the ugly. Process the feedback and act accordingly.
Starting an apparel business may not be a good idea at this time. But, while the odds may be stacked against you, that doesn’t mean you should not try!
Make sure you have a unique or a better product, some good advisors and enough funds to give the company time to gain traction.
Start with a small physical location where you actually get to talk to the customer and leverage that with your experience to build your empire!
Picture Credit: Fashion-Schools.org