How to Break Into the Fashion Industry
Emerging designers, beware: Even if you are able to create a beautiful product, the fashion world is fraught with tricky choices on incorporation, competitive analysis, sales, and protecting your brand.
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BOOTSTRAPPING THE RUNWAYS: Chloe & Reese started small, but two years into business the label is sold in Saks Fifth Avenue and Neiman Marcus, as well as small boutiques all over the world.
When Annmarie Scotto-Dinan quit her Manhattan public relations job to launch a women's fashion label, she knew she'd need to invest a significant amount of time in learning the trade, but she didn't know she'd also be investing a massive chunk of her savings. Dinan figured a small business loan would be key to financing her endeavor, but by the time she applied for loans in 2008, the economy was beginning its slide into recession.
Despite being unable to secure a small business loan, she went ahead with founding her label, Chloe & Reese, digging into her significant savings to do so. Her bootstrapping worked: Chloe & Reese has grown steadily through the recession, and Scotto-Dinan is coming out of the economic downturn with her dresses sold in global department stores like Saks Fifth Avenue and Neiman Marcus, as well as small boutiques all over the world.
How'd she do it?
"It's not just making a design that's great – it's figuring out wholesale margins, adding in the cost of packaging, shipping, taxes, tariffs, and making sure your profit margin will keep your business running," Scotto-Dinan said. "Like many designers, I'm so much more creative than analytical. But you have to focus on the numbers to make your business actually work."
In other words, breaking into fashion requires a lot more than just a degree in design and a talent dreaming up runway styles. We've interviewed emerging designers who have built their businesses from scratch, as well as legal experts who filled in the finer points of financial and legal sustainability to guide you through the fashion start-up process.
Breaking Into Fashion: Pin Down Your Dreams
Whether you create handcrafted vegan footwear or custom ball-gowns, before you take your product to market, experts suggest you ask yourself why, precisely, you want to do so. What's your goal?
George Nemphos, the chair of the corporate practice group at Duane Morris, a law firm in New York City that works with a lot of emerging and established fashion designers, says he asks all of his clients what their goals are for the business they're setting up.
"People in the apparel industry are very creative, and some of the legal aspects can escape them," Nemphos said. "It's part of the business that goes unseen. It's not what they're thinking about when designing, or are out there with the buyers."
Nemphos suggests before even enlisting an accountant or attorney to help set up the business, that an emerging designer solidifies plans for what kind of company they want to have, and what kind of life they'd like in coming years. How big they want to be, and where they'd like to sell their designs, will determine a lot of how a company should be set up – and help guide legal issues going forward.
Scotto-Dinan agrees that entrepreneurs in fashion and design should ask themselves: "Do you want something nice and easy, something that brings you joy and a bit of income without much stress? Or do you want to be a fashion empire? I really do think that goal speaks to how you're going to work."
For designer Jiminie Hayward, starting her business small – and keeping it small – is right in line with her goals. She graduated from Boston's School of Fashion Design in 2007 and began scoping out a target audience for her custom-made formal dresses. Her dream: to sew and sell custom-fitted hand-made dresses at an affordable price. Mass-producing was not an option.
So, Hayward designed 10 dresses and launched her brand softly, selling it online through an Etsy shop, MyBlackDress. She says she started with about $500 in fabric and supplies, and now orders from individuals account for $2,000 to $4,000 of income monthly.
"I get lots of requests for wholesale from boutiques and online stores. I will look into that in the future, but I can't handle it right now. I really like doing custom work for now," she said. The number of orders coming in online keeps her at the sewing machine from 8:30 a.m. until evening.
For Sonali Singh, who met her business partner and husband, Jeet, while they were students at New York's Fashion Institute of Technology, the greatest bulk of preparation in starting their label, San & Soni, went into market research.
"We had to do a lot of market research, as far as price points, what brands we wanted to sit in with," she said. The pair's label doesn't offer basics, such as a simple white blouse. Instead, it's centered on inventive construction. "We spent a lot of time on theme and inspiration, and that's how we came into the contemporary market – and we're in the higher end of contemporary."
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