If you are an entrepreneur looking to start a business, starting a clothing brand or business can be a fun, exciting, and potentially lucrative venture. One of the best things is that clothing businesses are usually not overly expensive to start and often do not require a large amount of capital.
The clothing industry has expanded exponentially over the past decade. There are a lot of opportunities in this industry, especially if you can fulfil a certain niche or provide something slightly different. This being said, there is also a lot of competition, and you’ll need to put in a lot of hard work and dedication if you want your brand to stand out.
In this article, we’ll give you some useful tips and advice in this step-by-step guide that outlines how to start your own clothing business.
Decide on what type of clothing business you want to start
‘Clothing business’ is a rather broad term. It is important to whittle away at this until you can provide a concise definition of what you’ll be doing with your clothing business. Some different types of clothing businesses include:
- On-demand garment printing – This type of structure usually involves buying blank clothes in bulk and having your designs printed onto them by a printing company, or by investing in your own printing equipment.
- Wholesale customisation – With this type of business, you’ll purchase relatively simple clothing at wholesale prices and have them customised with your logo, tags, labels, etc., and then sell them for a higher cost.
- Clothing design from scratch – Here you will design your clothes, source the materials and make them yourself, or have a manufacturer make them for you. This is probably the most complex structure but is very rewarding.
Of course, there are other types of businesses that fall into the ‘clothing business’ category, such as:
- Sourcing and selling secondhand clothes
- Opening a boutique that stocks a variety of local designer brands
- Creating a clothing manufacturing business that produces wholesale items
Whichever direction you decide to go in, be sure that you are certain of your niche and which specific customer group you’ll be targeting with your clothing business. Are you looking to create a fitness clothing brand? Are you specialising in high-quality vintage items? Are you wanting to offer affordable office attire? Whatever it is, you need to be very certain of your vision and your brand identity.
Building your business plan
Creating a business plan is very important for helping you stay on track. It is also an important document that you can show to potential financiers should you require business capital and financing.
When creating a business plan, be sure to keep it quite flexible as things in the clothing industry can truly change at the drop of a hat.
In your business plan you should have a plan of action for the first few months of opening your business, and determine how much money you will need to get your business off the ground. Budgeting is a very important part of your business plan, and you may need to do some research to get an idea of how much equipment and materials cost.
You’ll also need to make some important decisions about whether you plan to run your business from home and sell clothes online or if you plan on renting a store, in which case you’ll probably need to budget in rent, renovations, extra branding, etc.
You will also need to determine if you plan to open your business as a sole trader or limited company, and if you’ll need to hire any staff in the beginning stages, or if you’ll be okay with just hiring contractors if you need any help.
Depending on the type of clothing business you plan to start, the start-up costs shouldn’t break the bank. Especially if you are operating mostly online, at flea markets, etc.
But still, not everyone has access to enough capital to get their clothing business off the ground. If you need to access finance to get your business started, you may want to consider the following options:
- Private finance companies
- Angel investors
To give your business the very best chance of accessing funding, you want to make sure that your business plan is detailed, and that you have a ballpark figure of what you will need to get going.
Organising your business
Once you have obtained the financing you need to get your business started, you may want to start putting that business plan to use. But you want to ensure that you are organised from the get-go.
First, you should buy all of the equipment you’ll need to get started, and after some research, decide upon the suppliers you’ll be using.
You should also decide whether you will be working from home, an office, a workspace, or a storefront. Focus on getting your space into good working order.
Decide who will be helping you run those business essentials. If you are running your business yourself, you may still need to hire a designer, an accountant, marketing manager, or other employees. You may also need to hire models to model your first garments. Choose your team carefully!
Think about what products you want to have manufactured first, how you plan to manufacture those garments, packaging needs, and where you plan to store ready-to-sell pieces.
There are a lot of logistics involved with running a clothing business. Try to think about your process from top to bottom, making arrangements for where things may go astray. The more prepared you are, the better!
Your legal obligations
Before you start selling clothes, you have quite a few legal obligations to take care of to make sure that everything is above board and that you are compliant. The first order of business is registering your business with the HMRC as either a sole trader, partnership, or limited company. You may want to do some research to decide which company structure is best for you. Understand that this is a legal obligation, even if you just want to run a clothing business as a sideline business.
If you plan on employing anyone, you will also need to register as an employer and receive an employer’s reference number.
The clothing industry itself is not specifically regulated in the UK, so you won’t need any specific licences. However, there are still a few things that you may need as someone who owns a clothing business.
If you plan on trading at markets, you’ll need a market stall trading license which is relatively easy to obtain.
Your clothing will also need to comply with the following acts:
- Sale of Goods Act
- Supply of Goods and Services Act
- Sale and Supply of Goods Acts
Essentially, these acts state that the clothing products you sell should be exactly as you have described them. Do take your time to research these acts to make sure you’re compliant.
As the seller, it is your responsibility to meet these requirements, so pay extra attention to your labelling and advertising. Include the following on your labels:
- Fabric contents
- Country of origin
- Care instructions
You will have a lot of responsibility on your shoulders when it comes to tax returns and obligations. This is why it is very important to keep organised when it comes to your accounts. Prioritise keeping detailed records for your income and expenditure.
Another legality that you may want to look into is trademarking your brands and designs. Doing so could save you a lot of hassle in the future and protect your brand and business that you have worked so hard for.
What about insurance?
Insurance is definitely something you will have to think about getting as the new owner of a clothing business. The purpose of insurance is to protect you if something were to go wrong. Insurance may seem like an unnecessary expense, but in certain cases you are legally obligated to have certain insurance policies.
You may want to look into the following types of insurance for your clothing business:
- Professional indemnity insurance
- Public liability insurance
- Products liability insurance
The above types of policies will protect you should customers make legal complaints about your business and your products.
If you have a car that you use for business purposes, you may want to take out business car insurance for added asset protection.
Remember that if you are an employer and part of a PAYE scheme, you are legally obligated to have an employer’s liability insurance policy.
There are many insurance policy packages that cater specifically for the insurance needs of clothing brands, and these are well worth investigating.
Think about being environmentally friendly
While you do not have legal obligations to be environmentally friendly, this is definitely something that you should consider before you start manufacturing.
The clothing industry is responsible for massive amounts of waste each year, and the factory conditions in which many wholesale clothing items are made are dangerous and have long working hours. Think about if you want to be part of the problem or part of the solution.
Nowadays, consumers are also far more conscious about what they buy and how and where their clothes are made.
Potential ways in which you could increase your sustainability as a clothing business include:
- Recyclable packaging
- Ensuring your clothing items are manufactured in a sustainable way and workers are paid fair wages
- Making use of organic materials
- Creating clothing pieces that are sustainable and made to last more than one season
Fast fashion is affordable and popular, but the negative impacts of microtrends and fast fashion cycles are readily becoming more well-known.
Start making clothes!
Chances are that you have already made a few test products but if you haven’t, now is the time to do so. You want to be sure of the quality, colour and design of an item before you make it in bulk and start selling.
This is the part in the process where you work out your sizes, product catalogue and all of your final designs for your first line.
If you are not making your clothing items yourself, you want to ensure that your manufacturer is trustworthy and provides you with sufficient information regarding how the clothing is made.
Once you are happy with your clothing products, you may want to have them professionally photographed so that you can start advertising and use the photos for marketing materials.
Marketing your clothing business
Once you have taken care of all your legal obligations, it is time to start marketing and selling your items!
Investing in good marketing and branding is absolutely essential when opening up a clothing business. Remember that you have a lot of fierce competition, so your logo needs to be eye-catching and your marketing material has to be cohesive and memorable. You won’t regret going to a professional graphic designer or brand identity specialist.
Having a strong social media presence is also vital, especially if you want to sell clothes online. You want to be active on numerous social media platforms and post regular content that targets your ideal customers. Digital marketing solutions provide you with an inexpensive opportunity to reach a vast number of your ideal customers, so it is very much worthwhile looking into.
While dealing with all things tech, your clothing business or brand must also have a website that is easy to navigate, mobile-friendly and a good representation of your brand, whether you’re selling your clothing online, in a brick-and-mortar shop, or both.
Once you have all of your marketing material in place, you may want to get consumers’ anticipation up by doing a countdown to your opening or running an opening special. After that, it is time to start selling!
Starting a clothing business definitely comes with its challenges, but it is actually a lot more straightforward than many people think. The industry provides many opportunities for start-ups to thrive, even though the competition is stiff! By following these useful tips and steps, and conducting more research, start your dream clothing business and get ahead.