Between the Seams: What it Costs to be in the Business of Fashion

From afar, fashion looks like glitz and glamour. What with all the Travel, celebrities, and the element of it being a creative expression outlet. We can see why it’s tempting to take the plunge and start your own fashion brand.  However, fashion is a business like any other entrepreneurial endeavor. It’s packed generously with late nights, arduous work and endless decision making. And like any other business, it’s going to need a pretty penny to get things started. How much you’ll actually need to get your dream off the ground will vary from project to project. Nevertheless, once you figure these financial components out you should have a clear picture of the start-up capital required:

[Image: Anna Fashion Store]

Operating expenditures: you’re basically already married to the job, but you’ve got to make it official. Business registration and licensing are just some of the fees you’ll need to have a legal operation. Another smart cost to have is that of insurance. From the physical space the business occupies to the assets within the business, protecting your business and yourself from unforeseen events can ensure the future of your business.

[Image: Adam Parker]

Physical address: are you planning to have a physical store? You’ll have to figure out if you’ll buy or rent the space. Most landlords will need a security deposit that should be more than a month’s rent and they’ll take it up front. Once that’s cleared, you’ll be ‘looking at leasehold improvements. That’s everything from a fresh paint coat for your store to a full out customization of the space to reflect the business’s personality. Add to this the additional responsibility of tackling utilities such as internet, water, electricity and phone bills and stocking up on Business equipment you may need. That includes computers, furniture and office supplies such as mannequins.

You can’t have a fashion empire if no one knows your brand exists.

Marketing: you can’t have a fashion empire if no one knows your brand exists. So you’ll have a coming-out party aka a product launching event which you would have to organize and sponsor. After that, you have to make moves to keep your business fresh in the mind of your customers and potential consumers. While the most obvious element is advertisements, a clothing line’s marketing plan encompasses even the smallest of details. This includes, logo design, letter heads, business cards, store signage and a website.


Photo-shoot life: you know you have a good product, but customers need to be convinced. Something that’s hard to do when the clothes are still in the packaging. Seeing the apparel on a model through product photography makes it even more attractive to the client’s eye. These pictures are then incorporated in your marketing strategy as part of your product catalogue as well as contribute to your digital footprint when displayed on your website and social media pages.

[Image: Project 52 PRO Edition]

Pay day: no designer is an island and needs a team, however small, to help bring the idea together. A team that will need to be paid every month. Before the business starts to create a decent cash flow, it’s up to you to make sure their salaries come through on time. Even if you plan to run a solo show, you still need to pay yourself as well. You’ll need money to help you survive as the business set-up progresses.

No designer is an island and needs a team, however small, to help bring the idea together. A team that will need to be paid every month.

Technique Tune Up: you don’t know everything and that’s okay. Hiring a consultant can help guide you through the various startup process steps. From all your IT needs to finding the right location for your store. However, you can also set time aside to further your fashion skills by attending courses or workshops to gain new skills.

[Image: Archdaily]

Startup Inventory: this applies especially for designers heading in the retail direction. Your band’s boutique or store will need to open already stocked. Guess who has to pay manufacturers for this? This cost is something you may absorb a little after your first line. Sure, some designers can finance their second line from the sales of the initial line, but that isn’t always the case. To keep up legitimate appearances, you should budget for more than just the initial line.

[Image: Pinterest]

Manufacturing: it’s common knowledge that manufacturers will charge you less per unit when producing larger quantities. But before you go ahead and order 100 pieces of the same garment, you’d need to consider where you’ll be producing the item. For example manufacturing in bulk in China works out much cheaper than doing so in the west. Secondly, is there demand for the quantity you want to print?

[Image: Still from Sex and the City]

Transportation costs: every time your product has to make a commute, that’s a charge to you. Moving from the manufacturer to your warehouse or storage facility (which you also have to pay for), that’s easily shipping and clearing fees. Delivering the products from the warehouse to your store, clients or distributors? That’s another fee too.

This list is in no way comprehensive but it’s a decent place to start when considering the financial implications of starting a fashion business. From just these costs, it’s clear that starting a clothing brand isn’t cheap at all. But if you budget well and refrain from underestimating startup costs, you can have enough working capital to take care of everyday expenses until you break even. Sorting out these financial elements creates the image of a stable business and provides customers a reason to believe in your brand’s message.

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