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How to Start a Clothing Line
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For a fashion designer, a clothing line can be an expression of artistry. But to make money from that art, you’d need business savvy in addition to your existing passion.
As a newcomer to the industry, you could work to get your clothing line distributed in department stores like Macy’s or Nordstrom, or you could open your own boutique, said Kevin Lyons, an associate professor of professional practice at Rutgers Business School, who also studies sustainability and supply chain management.
But breaking into distribution takes time and experience in the field, so most new designers initially produce and sell clothing through their own business, Lyons said. Although creating your own clothing business may be one path to break into the industry, there’s much work to be done when starting a business from scratch, including sourcing materials, purchasing sewing equipment and identifying your target customer market, he said.
“There’s a lot that goes into this before you start stitching stuff together,” Lyons said. “It’s a very competitive field and it changes so fast.”
In this guide, we’ll help you understand what it takes to bring your sketches to life and start your own clothing line.
- 5 steps to start a clothing line
- Costs of starting a clothing line
- Stand out from the crowd
5 steps to start a clothing line
As the owner of a clothing business, you’d be responsible for more than designing and constructing garments. Follow these five steps to get started.
1. Choose your market segment.
First, you would need to determine what type of clothing you want to make and the customers you want to buy your clothing. Being as specific as possible would help you finetune a particular product and focus on capturing a certain segment of clientele, Lyons said.
“This is very important – to pick that marketplace and niche – because that’s going to help you focus on the materials you need,” he said.
For instance, a business that specializes in high-end men’s dress shirts can buy fabrics and target customers that match the vision for the brand, he said.
Market research would inform your decision. You could gather your own data through focus groups or surveys to find out what needs consumers have in the market. Information about consumers’ shopping habits, attitudes and buying behavior could help you shape your product offering and marketing strategy.
Clothing designers also have an opportunity to connect with customers through their artistic flair, Lyons said. A personal touch can resonate with shoppers as well — consider drawing inspiration from your community and experiences.
“Your clothing line is an expression of your art and your culture,” he said.
2. Write a business plan.
A business plan describes each aspect of your business, such as how you expect to generate revenue and how much money you need to operate. This could be required when you apply for financing, which we’ll discuss more in a later section. You would write your business plan before choosing a legal entity or structure for your business. This would determine your personal liability for the business, as well as how much you would owe in taxes.
When you sit down to write your business plan, include the following sections:
- Executive summary: Describe the clothing you plan to offer, your mission statement and information about any additional employees or managers.
- Company description: This is where you would illustrate how your clothing line would be different than others already in the market. You would also describe the customers you plan to serve.
- Market analysis: Your market research should include industry outlook and what competitors are offering.
- Organization and management: Here, you would describe the entity you plan to choose, whether that’s a sole proprietorship, partnership or a limited liability company, for example.
- Product description: Go into greater detail about what your clothing line entails.
- Marketing and sales: Outline your marketing and branding strategy, as well as your plans for sales and promotions. You should have a clear idea of how you’ll reach customers.
- Financial projections: Your financial outlook could span up to five years. Include balance sheets, income statements, cash flow statements and budgets to demonstrate your financial goals. Be careful to stay realistic and avoid embellishing numbers.
3. Source materials for your clothing.
Before you can construct your clothing, you would need to find cloth and fabric suppliers to provide materials. The relationships will likely be long-lasting, as your customers will come to expect products to be of consistent quality, Lyons said.
Industry newcomers can search online for sources and look to trade associations, such as the American Association of Textile Chemists and Colorists or the American Cotton Shippers Association. You could also visit a manufacturer in your town to ask for suggestions, Lyons said.
“Folks that are already in the business are extremely helpful,” he said. “They could give you sources or leads. That’s the best way, in my mind, to get started.”
Is sustainability a priority for you?
Sustainability comes down to where a material comes from and how it is produced, including labor standards regarding workers, Lyons said. If you want to create a sustainable clothing line, you could trace the origins of your raw materials. For instance, you could analyze your cotton fabrics – find out where the cotton was grown and milled and whether workers were paid fair wages throughout the process, he said.
Sustainability certifications are becoming more common and make it easier to identify suppliers that engage in fair practices, he said. Unfortunately, certified materials are often expensive. You might need to charge more for your clothing to account for that cost, but customers may be willing to pay a higher price for ethically-produced clothing, Lyons said.
4. Find a space to create clothing.
Depending on the size of your business, you could make clothing in your home or rent or lease a larger space, Lyons said. If you open a brick-and-mortar clothing boutique, you could set up your equipment in the back of the store. Or perhaps you want to run your business strictly online — making and storing your clothing at home and selling it through your website would be a way to keep costs down. Some e-commerce businesses later add brick-and-mortar locations.
You may need to find a manufacturer to produce your garments in a factory if you have larger ambitions for your clothing line, said Nicole Giordano, founder of StartUp Fashion, an online community and educational resource for clothing designers. Manufacturers would typically require you to place a minimum order. Unless you have enough clientele to meet that minimum, you’d probably be crafting the clothing yourself, she said.
Before settling on a manufacturer, you should have the factory create sample garments to make sure the look and the quality is right for your brand. A producer may charge for samples and you should include that cost in your startup budget. Also discuss timeframes to get an understanding of how quickly a manufacturer could fill your order.
If you decide to produce materials in-house, you’d need equipment that allows you to keep up with your orders. Basic equipment needs for clothing businesses include:
- Sewing machines
- Cutting machines
- Garment pressing machines, such as a steam press or iron
- Washing machines
The type of equipment you need would depend on the output of your business, Lyons said. Some industrial sewing machines are designed to handle a large production volume with software that can cut and size garments as well, he said.
5. Put a marketing strategy in place.
Before the clothing line launches, you should be spreading the word about who you are and what you do, Giordano said. You would want to create brand awareness ahead of time to build anticipation.
Consider establishing social media accounts for your clothing line and writing a blog on your business website, Giordano said. You could also speak at industry conferences or events to get your name out there as a business owner.
After the clothing line debuts, you could introduce your line to potential new customers through pop-up shops and trunk shows at various locations, Giordano said. Collecting email addresses and regularly corresponding with your subscribers through email marketing platforms could also bolster your connection with customers, she said.
Costs of starting a clothing line
To get a clothing business off the ground, you’d need about $15,000 to $20,000 for a line of three to five styles, Giordano said. You could expect the following initial expenses:
Prior to producing your full clothing line, you would need to create patterns and sample garments, Giordano said. If you plan to work with a manufacturer, you would also need to supply a tech pack that details the specifications of your designs. Your tech pack would include sketches, photographs, a list of materials and specific instructions for constructing each garment.
New business owners often don’t realize they need to invest in marketing and advertising before the clothing line is officially available, Giordano said. Early strategies include finding paid social media or in-person marketing opportunities. You should also pay for quality marketing materials, she said, such as well-made videos or professional photographs.
Marketing doesn’t necessarily have to be a big cost though. There are also free marketing opportunities for business owners, like participating in industry events and using social media forums.
Machinery can easily become your top expense if you produce clothing on your own, depending on your volume, Lyons said. A mom-and-pop boutique could likely get away with manual sewing machines, while a larger operation would need more expensive industrial equipment.
Labor costs would depend on how many hands you need to craft your garments, especially if you’re operating your own production site, Lyons said. Excessive labor needs are the reason many clothing producers have historically used unethical practices to keep costs down, he said.
Suppliers typically work with buyers who need a large amount of materials, like hundreds of yards of fabric, Lyons said. Placing bulk orders is often less expensive than buying material in smaller amounts. Be prepared to make a large purchase when ordering materials.
Financing your clothing line
Self-funding your clothing line could keep you out of debt, but business financing is available if you need outside assistance. You may not get far on your savings alone, Lyons said, as startup costs could consume the majority of your funds and then you wouldn’t have the resources to grow the business.
Securing financing could give you breathing room to develop your clothing line. It may be easier to secure financing if you’ve established your reputation as a designer and built expectations for your brand, Lyons said.
Here are a few financing options to consider:
You could apply for a business loan from a traditional bank or an online business lender. Banks often consider new businesses risky and you may need strong credit and collateral, such as your home, to secure the loan. Online business lenders usually don’t require collateral or a high credit score, and often have faster time to funding if you’re approved. However, online lenders generally charge higher interest rates than banks.
Business lines of credit
A business line of credit would allow you to draw funds from a credit line on an as-needed basis. The line would be revolving, which means the full amount would become available after you pay back what you borrow. You could obtain a business line of credit from a bank or online lender. Your personal credit profile and business performance would determine your eligibility and interest rate on your line of credit.
Crowdfunding can fill a financial gap for new business owners who can’t qualify for loans or lines of credit. Crowdfunding can have an added benefit for clothing designers, who can pre-sell garments to raise funds. You would be able to cover your first round of production costs and you would have customers waiting to receive those garments, Giordano said.
How to keep costs down
Start online: Selling your clothing online would save you the cost of renting or buying a storefront. However, shipping costs would become an added expense. Also, you could miss out on the benefits — namely foot traffic — of operating a brick-and-mortar boutique. Running a retail store would also give you added opportunity to become part of your local art and business community.
Sell made-to-order designs: Taking a made-to-order approach would allow you to make garments as customers place orders without wasting extra resources. You also wouldn’t need to buy large-scale production equipment.
Stand out from the crowd
Before jumping into the process of starting a clothing line, take time to consider how your line would be different from others, Giordano said. Oftentimes, designers are so focused on making a product that they forget to create an identity and point of view for the business.
“It’s a very saturated market,” she said. “That shouldn’t keep you from pursuing it. Just understand what is incredibly important right now is creating a real personality for your brand.”
The fashion industry as a whole has been challenged to address sustainability issues, such as improving fair trade practices and reducing waste, Lyons said. To stand out against existing businesses, newcomers could offer solutions within their niche market. Drawing on an earlier example, Lyons explained that a men’s dress shirt company could offer to repair collars or buttons to prevent customers from throwing away gently damaged shirts.
“Do something that’s still creative but solving a much bigger problem. Then you have yourself a business,” Lyons said. “You don’t want to be just like everybody else.”