As London Fashion Week is coming to an end and to coincide with the new season, The British Fashion Council, who organise the bi-annual event, have released figures from Mintel showing the fashion industry directly contributed ¬£32.3bn to the UK GDP in 2017.
This represents a 5.4% increase after 2016; a growth rate 1.6% higher than the rest of the economy. Womenswear represents 51% of the fashion market, with menswear accounting for 26%.
However, despite the importance of the sector, it is one of the hardest to succeed in, due to high start-up costs, sizeable competition and the diversity of products available.
So it‚Äôs essential for anyone starting up a fashion business, to have a business plan in place outlining their strategy, and to understand where their fashion brand or idea sits in the overall marketplace.
Fashion Angel is a fashion business accelerator offering mentoring, workshops (including at the Business & IP Centre) and access to funding to both new and established fashion industry entrepreneurs. Alison Lewy MBE, Fashion Angel founder and author of Design, Create, Sell ‚Äď a guide to starting a successful fashion business, gives some top tips for anyone planning to start a new fashion business:
- Develop a business plan before you start ‚Äď a business plan is your personal roadmap outlining your goals, visions and objectives and not just needed for raising finance. It will be central to your business development and be a useful tool to measure your progress against your projections.
- Don‚Äôt underestimate your start-up costs ‚Äď fashion business start-up costs can be high so avoid nasty surprises and list all your potential costs. Include the cost of your sample collection, stock, equipment, marketing materials, website, IP and professional fees, insurance, and of course any deposits required for rent or utilities.
- Research the marketplace ‚Äď find out about the size of the market for your type of product and whether it‚Äôs an expanding area. The British Library‚Äôs Business & IP Centre is a very useful resource for this as has numerous up-to-date fashion sector specific market research reports you can access for free. Identify your key competitors and analyse their business and marketing strategies. This will help you define your competitive edge and what differentiates your brand from other similar products.
- Create a strong brand ‚Äď your visual branding and brand story are central to the way the public perceives your label. Your customers should develop an emotional connection, and brands that create a strong identity are the ones most likely to endure.
- Profile your target customer/s ‚Äď conduct primary research to understand your customers‚Äô buying and lifestyle habits and create profiles for each type of potential customer. Keep this information in mind when you are designing your collection/products and setting your prices. Remember, you are not designing for yourself!
- Plan your product range ‚Äď offer a focused tight collection to start with, and do it well, rather than try to please everyone. It will be easier to produce too! You can diversify and expand once you have built your reputation and have sales history to base decisions on.
- Identify your sales channels ‚Äď think about your route to market and how you will reach your customers. Do you plan to be a wholesale business selling to retailers? If so how will you manage this? If selling direct to the consumer, are you planning to open a bricks and mortar shop or will it be online or both?
- Work out a marketing plan ‚Äď you may have an amazing product and lovely website, but how are people going to know about it? The marketing strategy is a key element of any business plan and should detail how you will promote the business, and budget needed accordingly.
- Adopt a realistic pricing strategy ‚Äď your pricing must be in line with similar offerings in the marketplace. Unless you are a well-known luxury brand, every product has a ceiling price that customers will pay.
- Offer excellent quality and customer service ‚Äď this area allows a small business to shine and can give you a competitive advantage. Reputation takes a long time to build but can be destroyed very quickly. Customers expect value for money whether you are operating at the value or luxury end of the market.
- Keep a tight control of your finances ‚Äď monitor your cash flow on a regular basis, this will help you foresee any potential problems arising and allow you to find solutions, rather than suddenly being faced with not being able to pay your bills or suppliers.
- Take advantage of any networking opportunities ‚Äď you‚Äôll need all the help you can get, so make sure you tell everyone you meet what your business does. Always carry business cards with you and always ask for one, so you can start to build your own database of useful contacts.
Starting a fashion business isn‚Äôt easy, but with passion, drive and a clear vision it can be one of the most exciting and rewarding industries to work in.