how to start a business online for clothing Archives

February 27, 2018

DESIGNER TOOLBOX: How Newsletters Can Help Your Fashion Business Achieve Solid Results

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Hi guys,
I witnessed a sad situation last week. I saw a fashion brand owner I worked with last year: she was totally exhausted. She has been posting relentlessly on social media for the past 6 months. She got a few likes and emoji comments here and there but in the end, her efforts did not bring the sales she was expecting. She was usually so peppy and full of passion but last week, she just llooked tired and fed up with everything.

I do not know if you have experienced this. That horrible feeling of deep fatigue when you end up questioning your choices. You were in for this whole thing because you were passionate about fashion. Remember? You just wanted to make beautiful clothes and share your passion to the world.
How did you end up there, desperately waiting for people to show up and wondering how to sell your clothes online?
I understand what you are going through: the struggle is real.
And I figured out that many fashion designers who start (actually even the ones who have been on the market for years and still struggle…) have ignored a totally basic tool.
Newsletters and e-mail marketing.

I know…

I am aware that the accessibility of a Facebook or an Instagram platform leaves the impression that everything is so easy. And it can be, if you use those tools properly.
But as you probably noticed, there is a lot of noise on social media and it is getting harder to get heard. According to Statista.com, in January 2018: there were 2.2 billion active users in Facebook and over 800 million users in Instagram. And numbers are going up as we speak, making it even more difficult to stand out.
So you absolutely need to think of an alternative to get your message through to your target audience and inform people about that cute little dress you just got in your store.

#1 – Why you are in a desperate need of a fashion newsletter

Let’s start with hard facts.

The ideal way for fashion brands to generate repeat orders

Here is one thing you need to know: an estimated 40% of purchases in e-commerce stores are generated by repeat customers.
What does it mean?
It means that 40% of the sales in your online fashion shop are generated by people who will buy from you again again and again.
Yes! A few raving fans can do miracles to your sales.

40% is massive: nearly half of your sales! And how can you make sure they keep hearing from your brand? The good old newsletter!

Your fashion brand needs to interact at least 7 times with a prospect before being able to sell

Yep. It is called the rule of 7. A prospect needs to interact and be in touch 7 times with your brand before buying from you. With social media becoming more and more crowded, you absolutely need a complementary way to reach your target customer.
How can you ensure that your message gets heard 7 times? Social media is one way but you can also send your messages directly to your prospect’s inbox.

Do not put all your eggs in the one same unpredictable basket

Thirdly you never know what will happen with social media. Today you have the Facebook or Instagram accounts of your followers but this is not a data you own. Facebook and Instagram own the information. And if for any reason they decide to change their platform, there is a risk you no longer have access to your own followers. It looks unprobable today but you never know!

At least with a newsletter you have an entire database with their email address. And this is at least an information that you own and can rely on.

Newsletters are just efficient. Period.

Emails are at least 4 times more effective in reaching your audience than Facebook for example. Email gets an average 20% open rate while Facebook has 5% talking about that same topic.
So I am not saying here that you need to forget about social media. On the contrary. All I am saying is that it is good to have the good old email to keep in touch with your customers.

A great way to tailor your message to your fashion brand and every single customer

The great thing with Fashion newsletters is: you can personalize the user experience. Because you reach them personally.
You will also be able customize your newsletter according to your brand identity. You can also use your subscriber’s first name.

You can connect on a more personal level and share more about your creative world.
In short, fashion newsletters contribute to create trust for your brand.

#2 What can you communicate with a newsletter?

I do get the issue of not knowing what to tell your audience about. And yet, you have a lot of things that you can talk about. To start brainstorming on this, you can also download our fashion newsletter brainstorming checklist.

Learn more about your audience first

Before you do this I highly encourage you to have an idea of what your customer is into. So even a basic analysis of your audience is enough to understand what kind of content they value.

Then the content also depends on the kind of experience you want your target customer to have with your brand. But basically, you will be able to share more about your lifestyle and create a real connection with your readers. You have a whole space to tell about your brand story and your brand identity.

Show them what they missed on your fashion brand’s social media profiles

You can also get them engage more with you on social media by showing them what they have missed on social media. Depending on what you share but you can also give them a taste of the kind of content you have on your Instagram account (behind the scenes for example or events).

Generate even more trust

You can also show them customer reviews and show them what is trending in your shop right now.

Share news from your fashion business

You can also tell them about a new fashion item or an event that you launched. Basically any news in your fashion business can be shared here. Also news about an upcoming collection or a current campaign that you are preparing or what is in preparation in your workshops. There again, it depends on the audience, you need to get the feel of what they like.

Show that your fashion brand lives

You can share some lifestyle advice. How to wear your piece for example. Where people can wear it.

#3 – How can you get your audience to opt in?
In the service business it is easier to share things in exchange of an email address. With physical products it is more complicated. You are not going to give away a product in exchange of an email. So you need to think about what you can deliver to your customer for free in exchange of an optin.

Here are some ideas: you can do a styling quiz that helps to profile your audience. And in exchange of the results, you get the email.

You can send them the care instructions in exchange of the email address.
You can send styling advice, maybe get inspirations from a celebrity that resonates with your brand and put together a styling booklet to look like that celebrity.
Then of course, you can also give a discount in exchange of the optin. You can also market the newsletter as a priviledge and give the promotions in priority to the people who sign up for your mailing list.

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February 20, 2018

SUCCESS STORY – 2 Unusual Ways To Break Into The Fashion Industry

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Hi Guys,
Today we are going to go through unusual strategies used by two now thriving fashion companies to break out in the fashion business.

The two examples selected are no classic profiles. They did not graduate from a facny fashion school. They did not launch with an insanely glamorous fashion show. They did not have a massive budget to spend on advertising. They are both very different. Each company has its own personality. One is from France, the other is from the US. But they both leveraged the power of social media in a smart AND organic way: we are talking about French brand Le Slip Français and US platform The Red Dress Boutique.

BRAND N°1 – LE SLIP FRANCAIS

For those of you who do not speak French, Le Slip Français litteraly means “The French underpants”. And in French, this word “slip” is not the nice sexy version. Nope! In French the word slip is the ugly old fashioned version of underpants. Today the founder who originally worked in an organic store chain is one of the favorite success stories in France.
The story tells that the founder Guillaume Gibault made a bet with his friend that he would make underpants fashionable.

He ordered 600 underpants and started the adventure.

The brand signature is: French made and audacity – audacity which is also a trait French people are famous for. The waistband has the colours of the French flag. And all the products are made in France, which is also a guarantee of quality;
The big breakout occurred in 2012 on French election. One of the candidate had a catchphrase that said “The change is for now”. The brand le slip français twisted the message with a video “The change of underpants is for now”. (I will let you watch it in the replay of our live video on top of this post – it starts at 05:33).
Needless to say that this campaign made a massive organic hit on social media. People shared it because it was bold and funny. And audacious.
It was worth sharing.
Besides he always stayed cohesive with the identity of the brand. For example, he also gave typically French or even Gaul nicknames to each product, like names that you would have read in this French comic book: Asterix the Gaul – “The Intrepid” “The valiant”…

Here are the best lessons that you can take out of this

#1 – Know who you are

The usual and favorite Fashion FXF advice: have a strong DNA. For that, you don’t have to have a necessarily complicated identity. On the constrary – Stay simple but true to who you are. In this case they Chose Underpants French Audacity. That’s it. And everything is aligned to that: design, production, tone of voice used in communication.

#2 – Use or twist something that is trending right now

Then you know what people are eager to share and talk about right now – You can go on websites such as Medium to see what’s trending – And use that for your communication. Of course, you have to be careful of the potential complaints. In this case, none of the candidates complained about the twist
Also be careful to not use any kind of news. Just use the ones that make sense for your brand and that can speak to your target audience. In this case, it made sense because it was the French elections and let’s admit it: the candidate’s message was just perfect for an audacious joke!

#3 – Share messages that are worth sharing

Lots of brands just dump posts on their audience…
Honestly have you wondered, how you change people’s life? Have you thought about the people at the other end? How will your product change their lives?
So from now on, what you need to do is to think of ways how your product can contribute to your audience’s life and lifestyle.
Inspire. Teach something. Make people feel something.
In this case it was funny but it doesn’t have to be funny. It can be comforting, motivating, whichever feels right for your brand identity and your audience.

Contribute to your audience’s life and well being.

BRAND N°2 – THE RED DRESS BOUTIQUE

The Red Dress boutique is an online e-commerce website and brick and mortar shop that sell cute and affordable clothing for women. They are from Georgia in the US. The company was founded by Diana Harbour.
At the beginning, she targeted students of the University of Georgia.
She got people’s attention by keeping her audience updated about upcoming items and re-stocks. It was the beginning of Facebook…and no other retail store was doing that.

And here is the trick (which still works today
She constantly asked for customer feedback. Her engagement is very high. So for example when she is on her buying trips to curate new items, she asks for feedback from her target audience to know if they’d like it or not. And depending on the answers obtained, she adjusts the quantity of items to buy. So she only gets the most wanted items in, which also decreases the need for markdown. Smart, right?
The same goes with the pictures she posts – She worked with students who posed for her pictures. But for example if the picture did not get much engagement, she changed it a little bit and posted the one that got most engagement.
To finish, the identity of the red dress boutique can be summarized in one word: caring. The founder genuinely cares about her customers. She cares about their opinion but she also cares about their life. She thinks of them – each package is wrapped like a gift and there is a handwritten note. Here is what you can read when you go on the website:
“I also wanted to create this place that would bring color and confidence and happiness to a woman’s day. Sometimes just having that one fantastic new outfit is all a woman needs to turn a bad day into a good one, to give a woman the confidence she needs going into an interview or to give that stay at home mom a reason to smile after that rare moment she treats herself. So I started handwriting all the thank you cards that went in our orders, packing it up like the present that it was and sending it off in hopes that it brought a smile to the woman it went to.”

That’s how much she cares about her audience and from all the engagement she gets from people and the way she keeps listening to what her audience has to say, it is so sincere that she made a business model out of it.
So what kind of lessons can you take from this?

#4 – Care about your customers

Start bonding with them. We have a fantastic opportunity with social media, stop ruining it by dumping your products on people.
Ask their opinion. Find out how they live, give a damn about what they are going through and how your product makes them feel.

Today you cannot just dump your posts on people: you have to engage. So start engaging.
And I am not only talking about putting green hearts and emojis on people’s posts. (ughhh…I have that account on Instagram that keeps posting that same green heart over and over again).
Share something useful that could enlighten that person’s day. Because guess what they are going to do once you care a little bit about them: they are going to check your profile and interact with you. Tadaaaa.
Plus social media totally loves and favors posts that engage.

#5 – Test until it works

It is applicable for the photos you use on social media but also for your posts. You need to find that tone and content that your audience best reacts to.

#6 – Ask for customer feedback

A lot of designers out there stay in their bubble and do not engage. with their audience. But how are you going to know what works if you stay in your bubble? You have to go out there and ask what they think about your product. How they like it, where they wear it, how it went, how it makes them feel.
Because all this is information that you will be able to fuel back into your marketing.

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February 13, 2018

DESIGNER TOOLBOX: The 3 Critical Steps To Learn How To Price Your Fashion Line

Hey guys,

Finding the right price point for your fashion line is one of the most difficult tasks a designer can work on. So many of you fashion designers come to see me to view the collection and help you price your items.
I get it. It’s not an easy task, especially if you’re on your own.
On the one hand, you are afraid that if your price point is too high, no one will ever show up to buy your items at that price. On the other hand if your price point is too low, you’re afraid that people may think that it’s low quality. And on top of that, you might not be able to make enough profit out of your fashion line. I get it! This topic raises so much anxiety. You feel the fear just thinking about it: is it too high? is it too low? Maybe you’ve even gone a step further and you’ve showed your fashion line to some people who showed some interest. Until you mentioned the price…
Yes trying to find a reasonable price point for your fashion line can feel like a real struggle when you’re figuring out how to start a clothing line.
We need to address the main obstacles that appear during the pricing process. I observed three main obstacles that created fear around pricing your fashion line.

#1 – Get Rid Of Your Mental Limiting Beliefs

The usual traditional methods won’t tell you about this although I see it as the main difficulty you will have to overcome when you’re launching your clothing line.
It’s the first issue that holds you from pricing your line properly: you feel that you and your fashion brand are one and the same.
Since you made the collection, it feels very difficult to put a price on your own time and effort. How much is it worth? You can’t say since you find it difficult to separate yourself from your own fashion brand. I understand, it’s like putting a price tag on your own person. If you have this issue, you will probably feel as affected when people give you a Bad review, it hurts personally as if they stumped on your own heart.
To start with, you need to step back and take some distance. What you need to do here is to clear your head and act as if you were hired by your own brand to perform a job.
Second obstacle is actually a consequence of the first obstacle. Since you feel that you and your brand are one and the same, you totally lack of objectivity. So all your personal issues might reflect on your fashion brand. As a result, if you have a low self-esteem you will probably think that you work is not worth paying a certain amount. So you will probably be asking for a ridiculously low price for a beautifully made product.

And if you are, let’s say unrealistic, you will be tempted to follow a high price point although the quality and the value added you deliver do not meet the level required.
You need to get rid of those mental patterns. They usually come in a form of a little voice telling you that you don’t deserve to ask for that kind of money or on the contrary, you feel that you worked so much on your collection that no matter the market reality, your fashion line should be priced like a high end product. When you hear those voices, you have to reason yourself by saying that you cannot rely on an unverified information that is only based on fear or belief.
Once you put aside the mental limiting beliefs, you have to take care of the actual pricing analysis.

#2 – Compare your fashion line to your competitors’, criteria by criteria

If you carried out a proper market research, now is the time to pull it out. Take your analysis of your competitors and position your brand compared to your competitors. If you haven’t performed any market research yet, I’d highly recommend you do one even if it’s only to be aware of the biggest trends and risks you are facing nowadays in the fashion industry. And you absolutely need to know who your competitors are, what makes them strong and what are their potential weaknesses. Concretely what does it look like?
It means that you will have to pick a few of them, analyse their offer and compare it to yours. In the checklist that I share in the Fashion Fix Facebook group, I’ve prepared a little chart to make the comparison easier and more objective. The idea here is to compare your brand to your competitors’, criteria by criteria. When you do this work, it’s important that you don’t lie to yourself. Otherwise you’ll just end up promising a value added that does not exist and disappoint your customers.

Choose a category you will work on (T-shirt, dress, skirt, trousers etc). And be honest with yourself, don’t just evaluate your product blindly. Also to do this exercise, you need to understand and to read the quality of the work.
When you put your product category in the chart, you need to ask yourself: how do you compare to your competitors on each of those criteria? if there are criteria on which you have a low assessment, can you maybe compensate with another criteria? For example if you are not able to make your products available on as many distribution channels as your competitor, which can make your brand less convenient to access to, maybe you can argue, promote rarity and the fact that you make limited series. Maybe you can even add that it’s handmade if it’s the case.

At the end of this exercise, you will get a price range for each product category as well as a more objective assessment.

#3 – Make Sure Your Price Point Covers The Costs

In the last step, you compare the price obtained to your production costs. There are different formulas out there. The most common you will find is
Production costs X 4 = Retail price
However if in your business model, you consider selling wholesale, you need to have some room for potential price discounts and sales promotions that retail stores will ask you to apply. So in the end, that’s why you can find markup levels of 7.
But what does that mean? It means that your retail price cannot be more than 7 times higher than your total production costs.

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December 7, 2017October 22, 2022

CASH & FUNDING: The 4 Essential Points A Financier Checks In A Fashion Business Plan

Bonjour Fashion designers,

You are live with fashion cross functional. Today is going to be about the 4 questions a financier asks himself when evaluating a fashion business plan.
As you probably know, I used to work in audit and finance. And one of my missions was to evaluate company loan applications and to decide whether I should grant the loan. I had some fashion companis applying for a loan. However fashion companies were almost systematically rejected because the financial estimates were not solid enough plus the activity is seen as very random and risky by financiers. And it was obvious while reading the financial estimates that the brand was struggling as a business and you cannot let that show.

The one thing I observed is that you focus a lot on the creative and production part. Of course it is very important to monitor that part properly. But being a business owner is different. You need to understand that you are supposed to conduct a business. A business means that you have to build a system that enables to generate sales and profits that can last in time. Whereas other people might have chosen more rational activities such as selling softwares or books, you chose to do that in fashion.
Some of you may probably have a business partner who takes care of all things business and operations while you figure out the creative part. But from what I observed, lots of you are launching on your own.
If you are alone in your business, you have to figure out the creative part as well as the business part on your own.
So in order to properly plan where you money will go once you launch, it is good to get a business plan drafted. Just as a reminder, a business plan is a document that helps you explain a project, the strategy that you will apply to make a business out of your concept, with the related financial projections. You need such a document before you start your own fashion brand, so that you are aware of what you need to do to keep your company afloat and where you put your money. And if you plan to ask for funding or if you plan to work with other business partners, it’s good to have a business plan to show that you know what you are doing. As I said in another live video, it shows that you know the conditions in which you are launching, you know your market and it indicates that you have a plan to get your collection sold. It’s a sort of a courtesy you do to someone who will lend or give you money. It’s the least you can do. It doesn’t mean that it’s over if you don’t do exactly what’s written in the business plan. Reality often happens to be different from the business plan. But it’s the least you can do, the first step to reach out to an investor or a banker. Consider it like a resume when you apply for a job.
There are 4 major points a financier controls when reviewing a fashion business plan.

#1 – Show that you can generate sales

In your financial estimates, you will have to deliver a profit and loss account. This document shows how your business model generates profits. And it starts with the sales line.
One of the mistakes I see you do is to think that finance is just about putting figures in charts. It’s more than that.

Finance is no magic.

I had a designer once send me a file that she called business plan. It was a video of a photoshoot and as a caption in it, you could read “we will make $23 million sales”. You don’t just add figures like that. You don’t just say you will make $23 million sales without explaining exactly what you will do.
So before you announce the amount of sales you will make selling your brand, you want to make sure to explain how you will do that. So the one thing a financier likes seeing is market data. You need to have your target customer defined and you need to have understood that ideal customer’s lifestyle. You have to do some research to understand how that customer lives, how much he or she buys in average, where they shop, what kind of magazines they read etc. But all this shows that you’ve done your work and you know who you are selling to.
The other analysis you need to do is your competition. You need to position your brand compared to other similar fashion brands your target customer already buys: what makes you different. Then you price your product accordingly. If you decided to price your product higher than your direct competitors, it is good to have a value added on top of your competitor’s offer. For example, you can say you sell very limited editions, they are rare. So rarity would be the value added that you can offer on top to “explain” the value added.

Once you’ve done that, you need to define your sales distribution system. So based on the market data you collected, in which area should your brand be present? Which popup store or mutlibrand do they visit? You need to be where your ideal customer hangs out. Is there a particular Facebook group he or she hangs out in? Or maybe he’s or she’s on Instagram? So you need to figure out a system to reach out to that ideal customer. This is also the reason why you need to be present on social media, reaching out to your audience at least 3 months before the launch. And once you target the social media, you can get a feeling of what they want and have them book your product in advance.

Once you figured out what your sales distribution will be, you can evaluate your sales. And again, it has to be correlated with what you’ve developed before in the sales distribution strategy.
Another piece of advice I can give you is to look at the final figure you got in the end. Let’s say you plan to make €250,000 in a year. You have to bring it down to a more tangible data. What does €250,000 a year mean in number of days? So if you decide for example to work 250 days during the year, it means that you need to make at least €1,000 per day to reach your yearly goal. So you keep that in mind every time you go to work and when you step foot into the office, you know that today, you need to generate at least €1,000 sales. Thinking like this helps a lot understanding the kind of effort you need to provide to reach financial goals.
This is for example a feedback we can work on together in the fashion business plan training that starts soon. I review your work and you get individual sessions with me to go through your very own business plan.

#2 – Build a system that enables to make profits

The second thing you need to show is that the system you implemented is able to generate profits.

What does it mean?
It means that all the strategy you implemented enables to sell enough of your fashion products to cover all the costs involved.
So as for the sales, you need to list up all what you need to generate those sales. So to start with, there are your production costs. You need to understand how much per unit, you are spending in your production costs: fabric, trimmings, production costs and delivery costs. You need to know which % it is in comparison to your retail sales price. This will give you the gross margin.
Once you get that, you need to list up all you need to keep your business going. So for example, maybe you will need to rent a boutique, there will be electricity charges. Maybe you will hire an admin temp so you will need to evaluate the salary and the related social charges. Then you will maybe work with a communication agency to take care of social media and reach people who can influence your target audience. You need to expense all that. You will need to organize sales events, rent a nice location, buy some food/drinks and hire a PR specialist to invite adequate guests so this is another expense you need to account for. You will have insurance costs to take into account.
So list up all what you need to do and evaluate the expense.
When you are done with that, you see how much profit you have left in the end.

At the beginning you often end up with a loss at the end. So you need to play: either you figure out a way to change your business model. So maybe you will find a way to sell more volume. Or you will try to cut the costs. For example, maybe you finally decide that you won’t be needing an agency to do your social media anymore. But it also means that you need to understand, in your head, that you will be spending time doing social media/newsletters every single day and that is less time that you spend designing and negotiating with clients. Or maybe you will need to work with a cheaper workshop but it means that it will involve more supervision time from you. Or if you find a cheaper fabric maybe you will not be able to price your product at the same level.
So really understand what your concrete actions generate in your business. Or if you decide to sell more quantities for example but you said it was limited edition, which justified for example that you price it higher. If you sell more quantities, will you be able to keep the price point you chose?

#3 – Show that you will never be short in cash

One thing that you will need to deliver in the business plan is a cash flow analysis. The cash flow analysis shows how money flows in your business.
This is one of the main reasons why a fashion company goes bankrupt: cash problems.

This can be quite problematic in fashion because advance a lot of cash in advance before being paid by your customer. You will probably need to advance cash to pay for fabric, production. Since you begin, I guess you need to build the trust with the suppliers so they will ask you to pay earlier than a more established brand. This is cash you need to advance. And even if you sell, you invoice your customer, if you work with somebody else’s store with a multibrand, you will not be paid immediately. Maybe even your product will be on consignment so you will need to advance cash to pay for the products you’ll send there and they will pay you when it sells.
So in the cash flow analysis you need to present how you will deal with that.
For sure you will need some security cash at the beginning. In finance we recommend to have at least 3 months of fix costs as a security when you start a business. It enables to show that you are able to face the situation where you have absolutely no sales for 3 months.
So you need to show each month, how much you will receive and how much you will expense. And at the end of each month, I recommend you to show you are positive.
Otherwise it means that you are in the red and it’s not a good sign for your business.

In terms of cash management, we also check that you do not have too much loan. Depending also on how strict is the bank but in a healthy business, we consider that loan should not represent more than 50% which is a maximum. In order to lower that rate, you need to bring at least as much capital as you your loan. So for example if you ask for 20kEUR, it is good if you can also bring 20kEUR as capital in your company.
So again, in the fashion business plan book, this is something we go through. In the bundle you receive during the training, you will be able to build your cash flow analysis. So you can fill it out and you get individual sessions with me to go through all what you’ve done, what can be optimized.

#4 – Business continuity: build a system that can last

The last point we ensure when we analyze a fashion business plan is business continuity. We try to understand if the business is solid and well built to continue. So for that, we essentially ensure there is enough equity left in the company. In the equity there is the capital you bring at the beginning and at the end of each year, it increases with the profits you make. If you have for example 20kEUR of capital, you make 5kEUR losses, then in the end you only have 15kEUR equity left. This is a sign that financiers look at .
And in some cases when there is something that doesn’t work in the business model, the company cumulates losses and it decreases the equity every single year. So your capital gets “eaten” year by year by your losses.
Some fashion companies have no more equity left in the end. This is a very bad sign for a company. Normally if you ve figured out the profit part, showing business continuity is not an issue.

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