The formula for starting a fashion business is changing daily. With online and offline developments taking place at lighting speed, the formula that was a big success last year might not work today.

That’s why we interviewed 16 founders from a wide range of fashion businesses – to find out what is working and share it with the next generation of fashion entrepreneurs.

Read on to see how they grew their businesses and get insights into how you can stake a claim to part of this £2 trillion global industry.

 

• Build up your know-how
• Be a self-aware creative
• Network, network, network
• Take a stand with your brand
• Find a gap, then fill it
• Identify innovative routes to the market
• Get your name out there
• Figure out your finances
• Don’t forget to consider the risks
• Find your balance
• Next Steps

 

Build up your know-how

Fashion is a huge and complex industry. If you are not already a seasoned professional, spending time learning the trade from the shop floor up will really pay off in the long run.

Tina Sutradhar, founder of MIUNIKU, says, “when starting a new business, you will have lots of choices to make, some of which will represent big risks. Working within the industry will show you how fashion works in the real world, and with industry know-how and experience you can reduce those risks.”

We all learn from our mistakes, but bad business decisions can cost time and money. There are many ways to improve your knowledge base, such as interning, working in the industry, taking a degree or a fashion short course, networking, and reading the industry press.

You don’t need to come from a fashion background either – starting a fashion business requires a breadth of different skill sets, many of which are transferable from other industries.

If you’ve worked within the business world, you’ll find it easier to grasp the financial side of things. If you’re coming from a communications background, the marketing and promotion aspects of running your business will be easier. Or if you’ve worked in retail, you may already have good understanding of fashion production, buying, and merchandising.

Any prior experience of technology and data science can be especially valuable because online retail is growing much faster than the rest of the industry. Sanjeev Davidson, founder of London Fashion Consultancy, explains that, “relatively low investment is required to set up your own ecommerce platforms such at Shopify, Etsy and so forth, and technology is increasingly important in fashion communications, analytics, personalisation, and supply chain”, so knowledge of tech can be a real advantage.

It’s unrealistic to know how to do everything, especially in the early stages of starting your business. Luckily, you don’t have to be an expert in everything (although you should make sure you have a good overview of how the fashion industry works). Many fashion entrepreneurs benefit from finding business partners who can balance out any weaknesses within their skill sets.

Be a self-aware creative

If you dream of starting a fashion business, you probably have a creative personality which is open to new experiences, imaginative, curious, and drawn to novelty. Whilst your creativity will help you innovate and adapt to the rapid change that startups go through, the reality of running a business is that much of your time will be spent on the less creative aspects.

Many aspects of business require more methodical and procedural work, attention to financial and legal detail, and diligent repetition of processes, and Tina Sutradhar says, “your time will mostly be spent on running the business, doing things such as marketing, production and sales, rather than designing.” You will need the discipline to be cautious in forecasting sales and prudent about risk management.

You need to be very realistic about whether these are things you c an be good at. Self-awareness can help you to understand whether you need to work on improving any identified weaknesses, or if you should ask for help. “Playing to your strengths but knowing when to ask for help is essential”, says Mohsin Sajid, founder of Endrime. “A good understanding of your strengths and weaknesses from the beginning can save you a lot of time and money in the long run.”

Network, network, network

As the adage goes, it’s not what you know, but who you know. While this isn’t strictly true – knowing things is important when starting a business – having a large personal and professional network is one of the most important resources when starting a fashion business. Veronica Hendry, freelance trend forecaster, says “Coming from a fashion industry background isn’t necessary but finding someone who can give you an insight into industry networks and supply chains can be invaluable.”

Regardless of whether you’ve worked in industry before, networking is one of the best ways to open yourself up to insights, advice and opportunities. Holly Anna Scarsella, founder of PAMPLEONE, says, “Make the effort to meet as many people as possible in the fields surrounding your business from suppliers, distribution, and marketing. It can seem daunting, but this industry is very small, and you never know who might help you along the way. Reach out to people you would like to gain advice from or meet. This really helped me to find some great mentors.”

Eddie Knevett, fashion consultant, agrees that finding a mentor is a smart move, particularly in the early stages of setting up your business. “It’s always good to have access to somebody who is not in your immediate circle, who can give you an objective point of view when you need to make big decisions.”

But how should you approach reaching out to people? Holly Anna Scarsella recommends being specific about what you would like to learn from them. “There’s nothing worse than someone just wanting to ‘pick your brains’ about business. Be smart, be informed, be intelligent in your approach.”

Take a stand with your brand

In an extremely competitive industry, it’s important for fashion brands to have a message and a story that consumers can connect with. Jacynth Bassett, founder of The Bias Cut, advises you to, “know what you stand for, what your values are, and stay true to them. Overall, authenticity is key, especially today where there is so much competition.”

Alongside being authentic, thinking about what sets your brand apart is crucial. Sarah Walter, Chief Creative Officer at Metail, says, “You really need to know what you are getting in to, and specifically what makes you different from anyone else and better.”

While it’s good to take a look at what your competitors are doing, Nichole de Carle, founder of Nichole de Carle London, advises entrepreneurs to build their brand around a certain lifestyle or social cause rather than following trends. “As a young brand, you have the advantage of identifying wider market trends and becoming an early adopter”. And Veronica Hendry recommends that new brands “should keep sustainability and a CSR plan in mind – remember that it’s important to be authentic – consumers can spot a fake a mile away, so only support causes you truly care about”.

Once you have a clear idea of your brand’s purpose, it will be much easier to communicate your brand essence to consumers and industry associations. “Understanding this helps to set the direction for your business and create a strong vision for your brand. This strong vision will help people to connect with your story” says Eddie Knevett.

Find a gap, then fill it

Having a clear idea of your brand positioning from the beginning will help you to find your niche within a crowded market. Nichole de Carle says, “There are parts of the industry that are heavily competitive and saturated versus very interesting gaps that present real opportunities to build out a successful niche business. Get to know your market inside out and really understand the opportunities before jumping in.”

When thinking about your product, Nick Crook, founder of Boardies, says, “ask yourself, what gap in the market am I going to fill? What is the need that isn’t being fulfilled? What makes my product or brand so different?”

Of course, to identify a gap in the market you will need to understand your target consumer. “Keeping your customer in mind is essential, particularly with pricing. Make it a priority to understand and know what your value proposition is for your audience, then work backwards to create the product,” say Jenny Liu, founder of Bomb Petite.

When Lux-Fix co-founder Rebecca Glenapp started her online fashion business, she successfully identified a demographic that wasn’t being catered for. “I think the thing that was most exciting for us was finding an under-served customer. While the rest of the world was chasing millennials and the 1%, we focused on an older demographic who are very style conscious, and now we have tons of events to go to. My simple advice would be to really drill down on who your customer is and what she needs you for!”

In the early stages of developing your product, it can be beneficial to get feedback from your target audience. Jenny Liu says, “don’t be afraid to test your products and use the feedback to help make decisions. Try to not take any negative feedback personally”. But also, don’t let perfectionism hold you back. Paul McGregor, founder of Men’s Fashion Magazine, says, “remember that your first product is never going to be perfect – all you need to do is Google your favourite brand’s first ever website or product and you’ll see the journey they’ve taken.”

Identify innovative routes to the market

Once you’ve established your brand, you will need to think creatively about how you are going to access your market. Holly Anna Scarsella advises, “don’t go into this industry with rose-tinted glasses. With e-commerce and social media, the landscape is ever-changing, and you need to keep up with it. Traditional models simply do not work anymore.”

Thinking laterally about the different routes to market can help you to use your resources wisely. According to Sanjeev Davidson, “advances in social media and other online platforms have created exciting new routes for small entrepreneurs, who now have the option to sell directly to their customers. The greatest positive here is the opportunity for fashion entrepreneurs to build direct relationships with consumers around the world.”

To take advantage of the range of distribution options available in the fashion industry, you will also need to build in a margin for distributors when planning your production costs and selling prices. Sanjeev Davidson finds that many small entrepreneurs “who get started with the direct selling business model don’t plan for a low enough wholesale price, and this deters retailers from placing orders for multi-brand destinations.”

If you envision seeing your product on a store shelf one day, you will need to focus on building good relationships with buyers and getting them to connect with your brand’s story. Kiren Passi, founder of Kiren Passi Design, says “Press, PR and marketing are key to getting stockists and stylists to pick you up and promote you.” While good publicity can get you noticed, the retail industry is competitive so you will need to prove your value and help them to see how your product fits within their store or on their client.

Once you are in a position to partner with a retailer, Fashion Director Candice Fragis, advises you to “think very carefully about your first choice of retail partner, because it will influence perceptions of your brand. You must choose a retailer who is consistent with your brand positioning, and who will place your products alongside complementary brands. It is better to hold out for the right partner, even if it is costly in the short term, than to work with a retailer that is wrong for your brand”.

Get your name out there

Fashion businesses need to be innovative in the promotion of their products and brand. “While the design part of fashion doesn’t really change, the tech industry has opened up new ways for brands to present themselves. The way brands market themselves, particularly through online presence, can make or break them,” says Mohsin Sajid.

Paul McGregor recommends improving your knowledge of digital and social marketing strategies, as this gives you a low-cost route to building relationships with consumers. “A good understanding of digital marketing can benefit you massively in the early stages of setting up your business. When the audience is already established, you’ve got someone to sell to.”

Think carefully about the lifestyle of your target customer because by understanding your audience’s preferences, you will be able to create an intelligent marketing strategy. “Firstly, you need to think about where your customers are spending their time”, says Eddie Knevett. “Are they online? Are they visiting certain areas of London? Which events do they attend? Think of all ways that you can start building your tribe and reputation.”

Also, Chere Di Boscio of Eluxe Magazine advises not to neglect promotion even before your product is released. “Get a buzz going by initiating your social media presence even before you launch your brand. Share information about what customers can expect, as well as images of prototypes, workers creating the garments, pattern cutting, fabrics, you name it. Share those posts with influencers and publications. You never know – you may even get some pre-orders!”

Once you have an established audience, Rachel Shaw, founder of Ruifier, recommends taking advantage of analytic tools. “As an e-comm business, RUIFIER uses all sorts of technology and analytic tools such as FB pixel, Google and Shopify analytics. It’s crucial that we collect and read data to deliver optimised and personalised marketing, as it is such a competitive industry.”

As your business develops – and your finances allow it – working with a PR agency is a good way to gain exposure for your brand on a large scale, as they will be able to connect you with the right publications. Jenny Liu says, “building relationships with the right journalists is key. Targeting relevant publications in line with what your customer reads and consumes can help you build that community and find partners who can champion the brand – this becomes a win-win.”

However, Eddie Knevett recommends only working with a PR agency when your product and customer service is perfect. “Understand that your customers are more educated than ever before. Treat them well and offer them a great product at a good price, with good service.”

Figure out your finances

Your funding requirements will depend on the type of business you are setting up, and the business model. Service businesses like consultancies or trend forecasters won’t need a great deal of initial capital, but if you are manufacturing fashion products or holding stock then your funding needs will rise.

You should look at your early stage as a period of testing and finding out what works. The more cheaply you can do this, the more tests you get to run and the greater your chance of success, and so in the beginning “every decision you make should consider value-for-money and whether or not it will drive your business forward” explains Eddie Knevett. “Starting slowly and scaling up allows you to test your products and make sure that your designs are right for your customer.”

There are many ways to reduce your costs in this phase. Candice Fragis recommends “avoid oversampling when you are starting out, because sampling is expensive and can really eat into your initial funds. It is better to design a very focused initial edit which showcases your design and speaks to your target customer with a small number of garments.”

You can also avoid over-production and failed launches by developing your customer base first. According to Nichole de Carle, a good approach is to “develop small and frequent productions while you are getting to know and understand your customer”, and then to “develop brand awareness through collaborations with complementary brands and influencers”. You should invest at least as much time in customer development as you invest in product development.

You can also keep costs low by starting your fashion business from home, selling solely online, outsourcing non-critical tasks instead of hiring staff, and investing in training so you can do as much as you can for yourself.

Eventually though, and especially if you are trying to create a global and recognizable brand, you will need to access additional funding. Whether this is loans from a bank, grants from a government fund, or equity investment, you will need a professional business plan that shows you are in financial control of the operations of the business. It must also realistically describe the levels of profitability the business will achieve as it grows. “It may be several years before you begin to make any profit and you will need to manage yours and your funders expectations quite carefully”, says Eddie Knevett.

Don’t forget to consider the risks

If you pour your heart and soul (and life savings) into your dream business it can be heartbreaking to see it fail, so think very carefully about risk and how to manage or avoid it.

The first type of risks are those that are inherent to the business model. The most risky businesses require very big investments before a single sale can be made (for example to develop new technologies, or refurbish premises). Sarah Walter says, “The most important initial question investors ask is ‘do you own stock?’ and they certainly prefer you not to because of the risk. They are often more interested in market places or other fresh business models”. Unless you can raise the finance, lessen your risk by avoiding big upfront investments or long-term commitments.

The second type of risk is, of course, that you get no sales. This is not uncommon, and if your product doesn’t sell, then something in the mix (target customer, product, price, promotion, etc.) isn’t right and you will have to iterate until sales pick up. “You have to learn from your mistakes” says Paul. “Being hands-on with your business can help you to figure out what does and doesn’t work early on.”

It may also be wise not to quit the day job until you are seeing some sales consistency. If possible, Kiren Passi recommends finding part-time employment within the fashion industry – such as consultancy or in a retail store – to help you through the early years of starting your business. This can give you the best of both worlds – consistent cash-flow and opportunity to develop your knowledge and skill set.

Until your revenues are more reliable, you must be willing to change constantly and be highly flexible. This means you must be very careful with the long-term commitments you make, to avoid getting locked into arrangements which turn out not to work for the business.

Until your revenues are more reliable, you must be willing to change constantly and be highly flexible. This means you must be very careful with the long-term commitments you make, to avoid getting locked into arrangements which turn out not to work for the business.

The third risk is too many sales! Whilst this sounds odd, high sales can lead to business failure through what is known as over-trading. This is when you lack the working capital to fund your activities – in short, a cash-flow crisis. This is especially common if, through inexperience, you have set your margins too low.

Nick Crook cautions entrepreneurs to “resist the temptation of trying to do too much, too soon. Don’t over stretch your resources and control your costs.” You must carefully forecast your working capital needs, and make sure you secure access to enough finance to support your operations. You should also negotiate hard on payment terms with suppliers and customers, to increase the cash in the business.

Fourth, you must think carefully about the risk of being dependent on a single supplier, who may let you down – choose them carefully. It can also be a risk to be dependent on a single or small number of customers. “You may be in a David and Goliath situation with suppliers or buyers trying to impose bad terms on you” says Jacynth Bassett. “You need to weigh up carefully the pros and cons of working with such businesses, and if you do decide to proceed, know your finances inside out and work out contingency plans. Also, don’t be afraid to push back; you have value and they want your business after all.”

Finally, there is the risk of your inexperience. Running any business is complicated, and few people are experts at everything. Don’t be afraid to seek help. This might be by finding a business partner, or an experienced mentor, or investors who bring industry expertise and networks to the business as well as cash. Don’t try to do everything yourself.

Find your balance

This may all seem overwhelming, and in truth the early years of a business require an enormous amount of time and effort and emotional commitment. It is important that you find a work-life balance during this time, for you and for the business. “While running a business requires sustained drive and motivation, making a conscious effort to switch off occasionally will help you in the long-term, by preventing burn out and helping you come up with better creative ideas.” says Paul McGregor. Eddie Knevett concurs; “It’s important to take time out to relax. Learning to manage stress is important. There’s no point in getting stressed about things you can’t control. If you can do something about a problem, do something. If it’s out of your control, then learn to let it go.”

Next Steps

1. Examine your skill set. What are your strengths? Where are the gaps? Do you have a good enough understanding of the industry?
2. Reach out within your network
. Who could you partner with? Who might be able to help you?
3. Think about potential niches. Look at trends, other industries, new technologies, or fashion in other countries for ideas.
4. Decide your vision.  What problem are you solving? How will you improve the world? Is it a cause that will inspire people?
5. Start building an audience.  Use social media to create content and attract people to your cause.
6. Create a prototype.  Whatever your product or service, give your customers a basic version as soon as possible, so you can get feedback.