Wow, the feedback from last week’s post was awesome! I get it – there’s a lot to think about. A lot of people were asking about costing, and what’s the ideal budget for a fashion business. So, this week I figured, we’d focus on that; Costs To Consider When Starting A Fashion Brand. To start there are no ‘ideals’ in this business, each brand is completely unique. Meaning, based on your designs and demand, there will be things you must have to achieve your desired finish, and others that aren’t essential. Allowing you to reduce or cut those costs completely. Like any business this is something you figure out when you’re forming your business plan. I find it easiest to break them up and list them under fixed costs and variable costs. Fixed costs, being ones that don’t change month to month i.e. rent etc., while variable costs change on output. They are usually things like wages, utilities etc. I’m going to break down some of the costs associated with starting a fashion brand, that many startups and small businesses don’t think of.
Note, some of these might not be relevant to your business, but I’m trying to cover all most areas to help all types of brand’s & their needs.
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Day-To-Day Costs
These aren’t just fashion specific – they are costs all businesses might acquire, and will differ depending on the business model you're operating - especially if you're retailing, but hopefully this will alert your brain to additional costs your business may have.
- Rent (unless you’re fortunate to set up your biz from a free location)
- Phone
- Internet
- Computer
- Software (such as Excel, Word, Photoshop, Illustrator, InDesign), etc. Tip - unless you're experienced with Adobe software I wouldn't buy these - they take years to master + they are expensive! There’s a ton of free photo editing software’s now available on the market.
- Electricity
- Car/ Fuel/ Transport
- Insurance
- Accountant
- Books/ education/ information/ consulting help
- Wages (If you have a team or an assistant)
Product Costs
These expenses all contribute to the cost price of your garments + include the components you need to make a finished product for sale;
- Trend Reports, Subscriptions
- Visiting Events/ Trade Shows/ Seminars/ Suppliers / Sourcing Trips
- Designs
- Technical Drawings
- Tech Packs (get your hands on a FREE copy of “12 Things Every Tech Pak Needs” here)
- Patterns (If you’re working with a factory, they may include them in the production price)
- Samples (It doesn’t happen often, but as with the patterns, these may be included in the production price)
- Fit Model(s)
- Production Cost - labor
- Fabrics
- Dying/Printing
- Trims, i.e. thread, ribbon, elastic, buttons, zips, clasps, etc.
- Labels, i.e. woven labels, size pips, card labels possibly with ribbon, kimble’s or pins, barcodes
- Hygiene Stickers (if producing swimwear or lingerie)
- Packaging, (including poly bags, garment bags, hangers, shipping boxes)
- Shipping costs (Transport from the place of manufacture to you)
- Taxes + Customs Fees (may be applicable if the stock is made in another country)
- Quality Control Inspections
- Stock Preparation. I.E. steaming, scanning in (tracking), distribution
- Warehousing/Distribution (if you are using a company to store your stock + send out orders)
Marketing + Sales Costs
Marketing is a huge part to your business success, especially in the fashion industry. You need people to know about your brand to generate sales. Your options are limitless here, but you don’t have to spend thousands to generate a momentum around your brand. There are lots of ways to market your brand for FREE. Social media is one example, but this requires a lot of time and understanding algorithms however! Other methods are outsourcing marketing professionals. Using PR is one example – having a company on retainer, working with you to build a solid marketing plan will help you get your product in magazines, websites and possibly even celebrities in your clothes!
Outsourcing Marketing & Sales Examples:
- PR Company
- Influencers
- Affiliates
- Sales Reps
- Brand Reps
Branding Design Costs
- Website
- Business cards/ flyers/ promotional leaflets, brochures / Line Sheets
- Social media scheduler
- Advertising, such as Facebook, in magazines, on blogs, influencer marketing, etc.
- Photography
- Model(s)
- Hair/make-up artist
- Lookbook
- Events such as press launch, pop-up shop, fashion show
- Travel to sales meeting(s)
- Media Kit
Looking at these lists alone can feel overwhelming, but it’s totally manageable and not as insane as it appears. With any business, you need to spend to accumulate. So, try not to get caught up with figures too much at the beginning. Obviously make sure you’re tracking everything but there’s a good chance your business won’t need all of it, that’s why planning is essential. This post hopefully helps you look at the big picture of what your brand needs just to operate. If your budget is tighter, look at what is essential for your brand and what isn’t. I encourage you to track everything. Costs, deadlines, production timelines, garment details, marketing, social media. Getting things organized makes it easier for you to manage and feel less overwhelmed.
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