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As usual, clothing brands such as Nike, Zara, Adidas, Hermes and H & M 2019 were the most popular. But what about 2020? Despite new, obvious obstacles with the right business plan and the right brand, a new online apparel company could top the list this decade.
Start with a solid business plan
When you look at pretty much any website that offers new business advice, one of the most important suggestions is to create a business plan. Creating a plan may seem uninteresting, but it's one of the most important things to consider when launching a successful ecommerce clothing brand.
A well-written business plan is essential, especially if you need to find investors and lenders. You also need to understand your short- and long-term goals and make sure you stay on the right track.
You need a well-designed pricing structure
First, determine your unit cost (CPU). You should also look at the other fixed costs for running your business, such as: B. Maintenance of the website and costs for employees.
After you've completed the calculation, you should aim to have your prices about 50 percent above your spending. You may be able to make a profit 30 percent above your spending. However, one of the worst things you can do is to reduce your profits unnecessarily.
Before officially setting prices, check your competitors' prices. This is only part of your customers' perception, but it is an essential part.
If there is a difference between your costs and their prices, you may need to make some adjustments. If your price is lower, you may want to increase yours slightly to be closer to the competition.
If your products are more expensive, you need to clearly describe to your customers what they will get when they buy your clothes and justify the additional cost. The appearance and quality of your clothing can significantly increase the value your brand perceives.
Related: 10 pricing strategies that can dramatically improve sales
Invest heavily in your online presence
As an e-commerce clothing brand, your website is your storefront. You need to attract customers and offer them a positive experience, from entering your website to leaving the website – hopefully during the ordering process.
Your web design should embody your brand. Within a few seconds of visiting, make sure that a viewer is excited and has a good understanding of your voice and personality.
Establish a balance between art and economy
Yes, starting a fashion line is an art, but it's also a business. You will not be successful without creativity and design. You also need to have a solid foundation in business and finance to turn your apparel e-commerce business into a complete package.
In general, it is difficult to be an expert in many things at the same time. So if you are more mistaken on the design and creativity side, you should hire someone to take on the business aspects of the company. Alternatively, if you are successful in building a business, make sure you hire creatives who can manage the right side of your business.
Seek an understanding of the emphasis on the offer
One big mistake new ecommerce clothing companies make is choosing the wrong process to create clothes. Although there are many different models, new brands often choose between on-demand creation, private label, custom and wholesale creation.
In a on-demand model, a third party creates and sends items of clothing to your customers. With this model, you don't have to manage inventory. This means that the third party takes a significant part of your profit because it creates and executes orders for you.
Private labels are created when companies design and then have their own clothing made. In this model, you are responsible for finding the fabrics and materials for your garments. You also need to manage your inventory and place your orders in this system.
Custom clothing is another option, but it's expensive and a niche. In this organizational scheme, each garment is made specifically for each customer. This process is costly, time consuming and difficult to do well.
Because of this high cost, only certain customers are interested in these products, which limits their customer base. With such a high average order value, however, this model can be financially viable.
Wholesale is another common way to create clothing. Here you pay for your materials and labor in advance and then a manufacturer creates your products. To do this, you need to manage the orders, inventory and shipments. Overall, this is similar to the first model listed, but differs in the sense that the third person does not make an approximate cut.
Related topics: How e-commerce companies can continue to win new customers
Why wait? Now it's time to get to work!
This decade is a great time to build an online clothing store. If you have the right drive, the right know-how and the right positioning, you can start a company that will achieve good results for years to come.