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7 Things to Know Before Starting a Clothing Business

— April 18, 2020

Having a clothing business can seem like a lot of work, but it’s important that you have fun. If you make a strong plan and don’t give up, you will create a strong foundation.

The fashion industry has been growing rapidly in recent years, with many younger generations venturing into entrepreneurship. We are seeing a lot of clothing businesses emerging on the market. In this era of technology and digital media, it seems that it’s very simple to start your own business and that it shouldn’t be so hard to enter the market. 

But, it’s a very tough competition, and many things have to be done differently to create a successful business. The trends are always changing, and you need to be able to meet the demands of your consumers. There are some rules and advice, so read on to find out seven things to know before starting your clothing business.

Know Your Niche

When starting your clothing business, it’s very important to start out with items you are familiar with and you have designed before. At the beginning of your business, you will probably be the only one designing the items. Look back on your experience. Have you designed bags and shoes, or have you been more focused on t-shirt design? 

Start your business by manufacturing, marketing and selling items in your niche. Avoid making clothing and other merchandise that you have not designed before. At least at the beginning year or two.

Make a Business Plan

A business plan is a must when creating a business, especially if it’s your first, and certainly if you want to have a solid base to build up your business on. Having a solid business plan will make planning and evolving your clothing line much easier and more organized. If you are looking for funding, a full-proof business plan will give you an edge in getting it. 

You will need to write an overview of your business, and a clear outline of how your clothing line will start, grow, and scale in the future. Include any analysis and research you have done. This can be researching your target audience’s lifestyle and purchasing habits. Your plan should say who is involved in your business, what products you will have, and the marketing strategies you have come up with. Finish with your financial position.

Create a Brand Identity

Your brand is what the world sees. Your brand identity is very important, especially in the fashion world, where image and how you are presented is everything. We choose a lot of things that make us who we are, and clothes are one of the closer items we can choose to truly show who we are and what we like.

Woman in striped pants against green background with “Good Vibes Only” neon sign; image by Ahmed Carter, via
Woman in striped pants against green background with “Good Vibes Only” neon sign; image by Ahmed Carter, via

The brands that we choose to wear can become how we see ourselves. The fashion industry can be very difficult to break into, but the thing that will set you apart from everyone is being authentic and creating an experience. Ask yourself, what message do you want to convey, and what makes your clothing unique.

Know Your Finances

Not having enough money to carry your business until the sales start to come in is why many clothing businesses don’t survive for very long. It’s important to understand the numbers and find out the exact cost of starting your own business. There are essential costs like employee salaries, materials, supplies, and tools. 

You will also need to pay for creating a logo, website, business cards, and other promotional material or advertising. Make sure you have funds set aside for any unforeseen expenses. You will need to pay for any license or permit fees.

Target Audience and Pricing

In business, especially clothing business, target audience and the price of your items, in this case, clothes, go together. Depending on your business idea and the clothes you want to sell, figure out what your target audience is going to be. Are you going to target hip teenagers or college students? Middle-aged people or you will have an older audience? When you know this, it’s time to set the right prices for your items. 

This is done by researching your customer’s financial, educational, social and lifestyle backgrounds. After all the necessary information, include your variable costs of business and determine the price of your items. You should set the prices to earn a profit margin of 30-50% over your total expenses.

Organize Your Business

Consider where is the best place to start. Is it going to be from your house or are you planning to rent out space? Are you going to sell online? Who is involved in the business and how many workers do you have? Create a solid marketing strategy that will hit hard and attract many customers and even potential business partners. 

If you want to make everything from scratch, you don’t need manufacturers. Another option for a clothing business is to buy wholesale ready-made products and sell them. A good example of this type of business is Style State fashion business and wholesale supplier. It’s a very popular method of clothing business. You don’t have to create the clothes yourself to have a successful business.


Having a business means there is a lot of paperwork and legalities. You will need to choose your legal structure, like a sole proprietorship or an LLC. You will also need a license or a permit for manufacture or sales of clothes. If you want to protect your business, a smart decision is to have business insurance or clothing shop insurance. 

This can include online retail insurance and product liability insurance. If you are dealing with investors, legal actions, paperwork, and all the other things that are not design and selling, consider involving a lawyer or an advisor who will help you navigate the legal waters.

Having a clothing business can seem like a lot of work, but it’s important that you have fun. If you make a strong plan and don’t give up, you will create a strong foundation. With a strong foundation, your business can have a successful future. Don’t forget why you started, and don’t give up.

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