Has it always been your dream to start your own clothing line? Spoiler, this guide is not going to teach you how to start a clothing line for free. First, the bad news. Starting a clothing line does require some capital. Anyone that is telling you that you can do it for free is lying. But, the good news is I can teach you how to start a clothing line cheaply and effectively.
And, there are so many amazing free fashion tools out there, that make starting a clothing line cheaper and easier.
BUT BEFORE WE GET STARTED...
I love helping startup brand founders succeed, so I created a bunch of free guides that will help you with your business.
They won’t be free forever, so make sure to grab them while you can.
- CUT YOUR SOURCING TIME IN ½ - the industry sourcing doc you didn’t know existed but definitely need
- HOW MUCH DOES IT REALLY COST TO START YOUR BRAND – I have helped people with as little as $2,500 get started; here’s how…
- NO MORE EXCUSES – get the exact productivity system I use to get things done
What you will learn...
This is a two-part guide. Click the links to skip down to each section.
First, we break down all the costs associated with starting a clothing line. A lot of the time most people don't understand just how much goes into starting a line. So, I'm here to break it all down for you.
Then, in part two, I will show you how to use and taking advantage of free fashion tools so you can start your own fashion line for as little as $8,000 with my startup business model.
We are talking about everything. From design to development, to finished product selling in stores, even an advertising and marketing budget.
The tips I am sharing with you are tried and tested and could save you thousands of dollars while starting your clothing line.
Part 1: The 7 Expenses Of Starting A Clothing Business, And What They Cost
Items EVERY clothing line business plan must-have, and tips on how to reduce your costs
- Product costs
- Shipping and logistical costs
- Sales costs
- Start-up expenses
- Operatin Costs
- IT + tech
- Marketing and promotion costs
- Advertizing
- Retail and sales expenses
Start-Up Cost 1 - PRODUCTION COSTS
- Clothing line design
- Development
- Sampling
- Producing inventory
- Storage
Clothing line design, development, sampling
DIY
The most expensive way to design a line is to higher a designer, pattern maker, graphic artist, and tech person. While yes, huge brands do it this way, I do not recommend this for a startup. You need to bootstrap.
If you are working with freelancers in the US, especially in NYC and LA, a designer can run you anywhere from $300-$500 per style, a pattern maker $150-400, custom prints about $300 per print, and the tech pack around $200. If you want samples made in the USA they are usually about $300-$600 depending on who you work with. That's all really expensive.
Why would anyone pay this much money?
Doing all of your design, product development, and sampling work in the states will usually end up costing you about $2,000 per style. If you are making 10 styles that is $20,000 on just developing. Not even making the product and having something to sell!
So, why would anyone choose to work this way?
One of the positives of new clothing lines working in the states is proximity. There is no time difference, if something goes wrong, your factory might be a short drive away, and communication is easier because there is not a language barrier, etc.
But, it is costly. And, time-consuming because there are so many moving pieces that you need to manage yourself.
Hire an Agency
Instead, you can hire a consultancy agency like my company virtue + vice that can help to do all of this for you in a factory overseas for a fraction of the cost. On average my clients pay anywhere from $200-$500 for the same process, which costs 2k in the US.
Saving Cash on Product - Tip 1
One of the easiest ways to save cash as a startup is to skip hiring a designer.
What I learned in my 10 years in the fashion industry is that most designers are more knock off artists than actual creatives. What they would do was go shopping, and buy clothes that they liked the fit of. Then, together we would make notes on the store-bought samples. Things like, turn this dress from a maxi to a mini, make the sleeves long, change the neckline to a V instead of a scoop, etc.
In this post, I teach you all the tricks that make it easy to turn a $20 Forever 21 sample into the design of your dreams.
Actually there is a lot you can DIY yourself in the product development phase, even if you don't have fashion industry experience if you know the tricks. From tech packs to samples, to money-saving tips on how to ship your product, I'm sharing everything I know on how to DIY and save cash in the product development course.
Saving Cash on Product - Tip 2
Use someones designs legally, with private label clothing.
If you don't feel confident in your design skills or don't have the budget to invest in the designs, there is one other option to consider when starting your clothing brand. Welcome to the world of the private label clothing line.
Some clothing manufacturers design and produce their own lines. They then sell those lines to companies, like yours, and allow you to put your own branding and labeling on them. This can be beneficial to a brand for two reasons. The first reason is, you get to skip all the costs associated with sourcing and product development I just listed above. The second is that your production costs are going to be even lower. These factories make thousands of the same shirt, and if you only want to buy only 10, because of economies of scale, it's going to be cheaper than you producing 10 of your own custom design.
The only downside is that others might have your designs.
Inventory
Your goods are going to cost money. And, unfortunately, most new brands are not able to buy on credit. That money is due upfront. There are lots of tricks you can use to balance cash flow, which I teach in my Production Guide. But, for the purpose of budgeting, it is important to start to think, even before you have started to design your product how much money you have to invest in a product, and how much you can realistically produce.
warehouse and storage
A lot of times new brands think that they need a complex warehouse, shipping, and logistical partner to help them manage sales. The truth is, like many things, you can DIY. Most small brands don't need a warehouse for their first order. Clear some space in your garage, spare room, or basement, or even your bedroom closet, and store your stuff yourself. As you grow and start producing income, then you can start to look into warehouse and distributions partners.
Start-Up Cost 2 - SHIPPING AND LOGISTICAL COSTS
So, I mentioned that you don't need to hire a warehouse. But, shipping still needs to be accounted for. And, there is a lot more shipping involved in starting a clothing line then you might have realized.
When most clothing line start-up founders think of shipping, they think of shipping out their orders to customers.
Well, rewind for a second.
Did you know that mailing a Minella envelope to China from NYC costs about $80, a box of samples about $3 pounds can cost over $200. That's a lot.
Shipping is a silent operating cost that adds up quickly. The trick is to stay ahead of it.
Most people don't realize how much shipping goes into starting a brand. I'm going to break it down for you.
Usually, most design teams will send over some bought samples to the factory to get them going. If not for fit, then at least for the fabrics they would like the factory to source.
The factory will then send back counter swatches of fabrics they have on hand for the brand to use.
Sometimes, you won't like what the factory sends the first-time. So they will need to send swatches again. This cost for shipping is on you, the brand.
Once you approve fabrics they will then make fit samples, lab dips, and strike-offs (to learn more about this check out the Product development Course). And, most of the time the prints and colors and fits won't be perfect so you will need to have them send a second trial.
After that, they will send you production quality samples that you can use for final approval and things like photo shoots, and trade shows, etc.
If you want SMS samples, salesman samples, which are samples sets you give out to different sales teams, and showrooms, that is another shipping fee (not including the cost of the samples themselves).
Once you place your production order for inventory, they will start making all your fabrics, and once the fabrics are ready you get something called a PP sample. The PP sample is your final chance to check everything before you bulk is cut + sewn. And, that is yet another shipping fee.
Once your bulk is made, you guessed it, it all needs to be shipped to you or your warehouse. Even more, money spent shipping
And, then finally you need to ship to your customer. And, also worry about them shipping back to you with returns.
That is a lot of shipping, so keep all of that in mind when you make your budget.
Saving Cash on Shipping - Tip 1
In one word, loyalty. Choose a freight forwarding partner to work with, make an account, and stick with them.
I personally use FedEx. While they are the most expensive. They are also the most reliable for international shipments. For me, the extra money is worth not having to worry about if my package is going to make it on time. They also have a great loyalty program. For packages that would cost anyone else $100, I get a price of around $80. $20 might not sound like a lot but, I promise you it will add up.
DHL is my second favorites, with UPS my last.
Do yourself a favor and NEVER ship internationally with USPS. I have had items stuck in customs with them for over 2 months and little to no customer support.
Start-Up Cost 3 - SALES COSTS
Once your product is made and shipped to you, the next set of expenses to come your way before you can even start to make money are sales expenses. Are you going to be doing a trade show to try and meet buyers directly? Or will you be doing the popup and local market circuit? Will you hire a sales team or a showroom to get your product into the hands of your target market quickly? To learn more about what sales channels would be best for your brand you can check out our sales guide.
Trade Shows
The bottom line is that any sales efforts are going to cost some money. Trade shows are about $3,000-10,000 depending on the show and the size of your booth. Really big booths and really good shows can cost up to $25,000 or more. And, remember if you go the tradeshow route you will need to fill your booth with sales tools like signage, decorations, sales materials, etc.
Pop-ups + Markets
These are a little more affordable than tradeshows. Sometimes the fee for a table can be as low as $100. And, they are a great way to connect with your customers directly and build brand loyalty. Just like the trade show though, you will need some cash budgeted aside to deck out your booth with signage and decorations to draw your customers in. Popups and markets vairy, and can cost anywhere from $100 to $3000 depending on the event and the type of crowd they are able to draw.
Here's a little insider information from small brands I work with, I hear nothing but amazing things about the Renegade markets.
Showrooms + Sales Agents
Hiring a showroom or sales team is a great way to get sales going at boutiques, and other shops and retailers. They will generally come with decades of buyer contacts and can get your sales quickly. The downside is it will cost you serious cash. Not only do showrooms take a large commission on each order they get you, but there are also monthly showroom fees, show fees, and other operational expenses they will charge you too.
Reputable showrooms will range between about $3000-$5000 per month, and on top of that will take anywhere up to 30% of your sales. Using an independent sales agent is a little cheaper because they do not have as much overhead as a showroom. But, you will still have to pay them a salary, the minimum is generally 35k per year, and give them a significant commission on each sale they make.
Sales - Tip 1
Research. I would recommend researching all of these methods before deciding which is best for your brand. Once you decide, call up some places, get some quotes, and add it to your budget.
Start-Up Cost 4 - START-UP EXPENSES
This is everything that will go into starting your business. All the little things that are going to add up.
Bread + Butter
Let's start with the basics. Will you be paying someone to make a logo for your brand? Will you trademark and copy write your name and imagery? You will need to buy a domain name for a website, and then pay a monthly fee for a platform to host your domain. I use Shopify and Wordpress for my online stores. There are legal fees with starting a business too, Legalzoom, in my opinion, is one of the cheapest and easiest ways to start a legitimate legal company.
Start-Up Expenses - Tip 1
Think of all the little costs that go into making you a legit company.
Start-Up Cost 5 - OPERATION COSTS
Once you are a real company you will then need supplies, insurance, accounting equipment, travel and transportation, petty cash, salaries, taxes, etc.
How To Find Your Operating Costs
I know some people that pack for trips in a really interesting way. They go through their morning routine and pack accordingly to what they use. This way, they don't forget anything. And, it kind of takes the chaos out of packing. Personally, my method is to just throw everything into a suitcase on the way to the airport.
But, this very organized and calculated method is great for making a list of your start-up costs.
If you are still working a 9-5 take inventory of everything that you use in a day.
Supplies
You probably use a computer. A printer, paper pens, etc. Did you ship something and print a label you will need some of those. I bet you have binders and other organizational tools on your desk. Office supplies like staplers, scissors. In fashion you will be measuring things, you will need not only a ruler but a measuring tape. And, maybe some other supplies like seam rippers. All of this stuff costs money.
Subscriptions - What Are Your Monthly Recurring Costs?
Most design studios need Adobe Illustrator or Photoshop. Many companies opt to use pro versions of design tools like Canva. And things like G-suit to keep your company connected are about $30-$50 per month. Dropbox for file storage and sharing maxes out and you need to pay for storage after a certain point, will you be able to pay for more storage? Every month I pay for a Quickbooks subscription, which is an accounting tool that I use to keep track of my money going in and out, and also send invoices to clients. And, now that I have grown I also pay a bookkeeper every month to keep all of that organized for me, and at the end of the year an accountant to do my business taxes.
Space
Are you going to rent office space? Or just work from coffee shops? Kettle Space is an amazing compromise between the two. Restaurants that are only open for dinner turn their shops into co-working spaces during the day. The rates are inexpensive, and depending on the restaurant there are sometimes really yummy free treats during the day. Regardless of what you choose to do, your office space is going to cost you money. Even if it is just that 1 cup of tea you buy at 8 in the morning and leave sitting next to your laptop at the coffee shop for the next 8 hours.
Travel And Getting Around
That subway ride to meet a potential store buyer? That costs money. Getting to trade shows, going to networking events, getting in your car and driving to a store to do market research? That all costs money too. Will you travel overseas to meet your supply chain partners? Make sure to include all of that in your budgeting.
Start-Up Cost 6 - IT AND WEBSITE EXPENSES
I mentioned your website in the start-up expenses, but it can be a little more complicated than just setting it up yourself depending on the things you need.
If you feel confident with the DIY approach then your budget for your website will only be your domain and hosting fees.
But, professional websites can cost anywhere from about $3000-20,000 depending on how complex they are.
DIY Website
If you are just getting started I recommend using Shopify with the Shogun plugin for page building.
Shopify is a powerful platform for e-commerce. It comes with all the tools you need to start selling online immediately. And, for only about $30 per month.
Shogun is a simple drag and drop system that makes building a website incredibly simple. shopvirtueandvice.com was built using Shopify and shogun. To keep the site running its costs me about $60 per month. But, that is a lot cheaper than paying a website developer.
Are you the kind of person that needs a separate business phone so you don't get distracted? Is the storage on your old laptop running low? Do you need a new computer? Or, could you make do buy an external hard drive? Take all o this into account.
Saving On IT - Tip 1
Instead of investing in a new business phone, get a free Google phone number with Google Voice instead.
Do you need special tech like stylists and drawing pads for your designers and graphic artists to use with Adobe?
All of this needs to be considered in the tech section of your budget.
Start-Up Cost 7 - MARKETING AND PROMOTION COSTS
Product photography, look books, events, social media, public relations, fashion shows, social media giveaways, and partnerships.
The first step in starting your marketing campaign is having something to share. That is why the first photoshoots are so important. You want to have really high-quality images that match your brand's message and draw your buyer in.
Don't feel like you need to be pressured into hiring top photographers and models to take your photos. There are easy DIY techniques that I and many of the brands I work with have used to create stunning visual content. For starters check out Vsco and Snapseed. More information on free tools to use for photos and other marketing techniques is in our marketing guide.
Marketing Your Brand - Tip 1
Sometimes the best campaigns can be done with an iPhone, a couple of friends, and the right lighting.
Marketing + Sales Tools
Once you have your photography done. You need to get it out there and make a look book and line sheet. You can also hire someone on Upwork to make them for you, and it will cost about $100-200. If you are going to trade shows you will need to print these out to give to buyers (yes, another expense).
Marketing Your Brand - Tip 2
To save cash, try making your own line sheet with the Brandboom platform. Brandboom even offers a private space where brands can connect with buyers if you want to go the DIY sales route.
Will Your Host Events?
Will you have a launch party?
Or, host a community event? When I first launched virtue + vice I did a super cheap $15 ticket to a DIY indigo dye night. Between the space, food, booze, dye supplies, etc I ended up losing money on the event. But, because it was so cheaply priced it drew our a huge crowd and I made some amazing contacts that I still keep in my Rolodex today.
Do you want to have a fashion show?
I would advise against this. Fashion week is dead. While it will offer some legitimacy to your brand to put on such large scale production, in terms of ROI (return on investment) most brands find this a waste of money that they wish they could have spent somewhere else. If you still want to do a fashion show, even though I don't recommend it, remember you will have lots of events costs like, paying models and makeup artists, the actual space, music and speakers, video, gift bags, promotion, etc.
Social media isn't always free
To really build your following you need to give them something they want. Either that is amazing content that resonates with them (maybe you hire a content creator), or giveaways.
Giveaways
Having giveaways are an amazing way to gain loyal followers quickly. But, remember, giveaways also arent free. You are giving away a product that could have potentially been sold for profit.
Influencers
At the moment I do not recommend working with influencers as a new brand. The ROI is nonexistent, and most brands mark the "partnership" up as a loss. There is even a growing trend that people will actively not buy what some influencers are selling. I would recommend saving your cash for more grassroots efforts like community events or giveaways that directly have an impact on your potential customers and keep the lines of communication between you and them.
Start-Up Cost 8 - ADVERTISING
This is tricky. When I first started virtue + vice I believed, like many new startups. I needed an advertising agency. We have all heard the promises of sell-throughs, and returns on investment for advertisement spending. The thing is none of it was true. I ended up nearly suing my first ad company for false promises and zero sales. In the end, they refunded me all of my money.
My story is not unique. This happens to so many small start-ups.
Most of these ad companies that charge between $3k-$5k per month, and that is not including ad spend, are scammers. Snake oil salesmen that are selling you a dream. A magic pill of sorts. They will promise you that they know the perfect algorithm to get you sales and grow your business. The truth is most of them don't.
Never work with an ad company that will not give you referrals. At a minimum, you should speak with 3 of their current clients to make sure they are legit. If they tell you it goes against their privacy policies, just say buh-bye.
But, all ads aren't bad. They can be super helpful for getting new business. I recommend using AdEspresso do DIY your Facebook and Insta ads. They offer powerful ad technology, that some firms even use, at a minimal price. This way all your ad cash can go into actually buying ads.
For Pinterest ads and publishing try using Tailwind.
Start-Up Cost - 9 - RETAIL STORE EXPENSES
Are you opening a store? I would advise against this. Test the market out at pop-ups and markets first before making such a huge investment. But, if you are going to open a store, take these expenses into account.
It's not just the rent, and POS system you need. You also need to decorate the store, you need tables, shelves, a build-out dressing room, hangers, staff, signage, and even and insurance policy and security system.
I go more into setting up the store and other retail and pop up spaces and everything they entail in our guide to retail.
PART 2: Starting Your Clothing Line For 8k
SETTING YOUR BUDGET
How to start a clothing line with only 8k.
Now that you know all of the moving pieces that go into a start up clothing line budget we need to work backward. Use this free downloadable guide at the end of the post to help set your budget. This is one of the first things every new start up clothing line should do.
How much do you want to spend?
Set a max dollar amount of what you are willing to invest. Be honest. It's just you right now, there is no one to impress. How much are you comfortable investing into your business?
The first thing you need to do is set a budget, and, no that budget can't be $0.
In my opinion, $8,000 is the minimum you need to comfortably start a clothing line.
Now, Save Some Cash For A Rainy Day
Ok, do you have your number? Now take out $1,000.
Set that 1,000 aside. That is going to be your emergency fund. Even with this guide and planning for everything you can possibly think of, the world of fashion is uncertain, and it is always good to have extra cash. Maybe a new amazing pop-up opportunity happens that you didn't plan for, or maybe someone steals your laptop. To build a strong and healthy business you need to have money stashed away for a rainy day.
Again, these are your emergency funds. Don't touch them unless there is actually a business emergency.
Now you are left with $7,000. And that money needs to be split between product costs, shipping, sales, start-up expenses, operating costs, it, marketing, advertising, and retail.
REAL START-UP CAPITAL = $7,000
Fixed Costs
Now let's look at your fixed costs like start-up expenses and operational costs. They don't really change.
Buying a domain name is about $20, a Shopify monthly account is about $30. So your website for the year will be about $400.
For your website, you will need to DIY. But, Shopify makes it easy. And, with a few free online tutorials, you will be up and running with an amazing site.
You need to be a legal business, with paperwork and government filing like an EIN number. On Legalzoom, this will cost about $300.
Search your house
For office supplies search your house and see what you already have. I would budget $300 for supplies for the year, remember things like printer ink are not free when you own your own business and, can be super expensive.
Total start-up and operational expenses - $700
We now have $6,300 left in our budget.
Operational Expenses + Monthly Expenses
You don't need QuickBooks to keep track of your money, you can use excel which is free. Opt to use the free versions of subscription plans like Dropbox, Canva, etc. This is your first year of business, you are bootstrapping and need to save cash everywhere you can.
Total monthly subscriptions - $0 - boot strap
We still have $6,300 left in our budget.
Shipping + Logistics
Take out another $1000 for shipping your first collection.
I know it sounds like a lot, but shipping is expensive and you will be happy you set so much money aside once you get started and see the shipping bills add up.
I have been in this business for 10 years, and I am still shocked every month at my shipping bills.
We now have $5300 left.
Let's Talk About Product Costs
If you work with me at virtue + vice, (I can't speak for other agents and factories) this is how your product development production costs might add up.
For this example, we will make 3 styles for a capsule collection, each in two colorways. Colors are a great way to add variety without increasing your development budget.
We will make 1 top, 1 jacket, and 1 pant. Here is how that will break down.
Print Design
I would recommend making your colors 1 solid and 1 print. Hiring an artist can cost $300 that's a lot. Instead, use a website like Shutterstock or Pattern Bank where you can buy prints for $50.
Total cost for print design = $50
Sampling
- The bought samples to model your styles off of will each cost about $50.
- The factory needs to make a pattern and fit sample that is about $50 each
- The factory then needs to make a production-quality sample (approximately $60) of each colorway. Proto samples are generally about 2 times more expensive than the cost of your production.
Let's Break that Down
Top bought sample - $50
Top fit sample (including pattern) - $30
Top proto sample, color 1 - $60
Top proto sample, color two - $60
Jacket bought sample - $50
Jacket fit sample - $30
Jacket proto sample, color 1 -$60
Jacket proto sample, color 2 - $60
Pant bought sample - $50
Pant fit sample - $30
Pant proto sample, color 1 - $60
PAnt proto sample, color 1 - $60
Cost for 1st round of sampling is $600
You also need PP samples, which the facotyr charges for, before bulk shipment. All 3 styles each in 2 color ways will be -
$60 x 6 = $360
Total cost of all samples = $960
Production Costs
$30 x 120 pieces = $3600
Total cost (design + sampling + production) = $4670
Consider Private Label
If you choose private label designs, you save on all of your development costs which were $960, (plus all the shipping of the samples back and forth, up to $500).
By choosing private label pre-made designs you could save up to $1000 to reinvest into other areas of your business.
We Are Left With $690 For Sales + Marketing
As a startup, you are going to have to be your own salesperson. I have great tips on how to do that in our sales guide. Selling tools like photoshoots, lookbooks, and outreach to store buyers. That is all you. But, I promise with a little help and a few tips I have picked up along the way, you can do it yourself.
I Would Skip The Online Ads At First
With such a small ad spend your advertisements will get lost in the internet white noise. I have heard from multiple advertising agencies to really see an ROI with ad spending you need to be investing about 8k a month. And, that is just too much for most small brands. So, use other avenues of promoting yourself.
Get Your Own Press
I have a guide to PR that I am releasing soon that includes everything you need to generate your own press. I have never had a publicist, on my own I have been able to be featured in, WWD, Vox, NBC, Parents Magazin, and even speak at SXSW. You can DIY your own press for free. I'll even share one of my tips quickly now.
Reach out to your childhood downs newspapers. Many of these small publications love to write about what their ex-residents are doing now. It's a great way to get your foot in the door and start building your PR campaign.
So, How Should You Spend Your Marketing + Sales Money
My honest recommendation on how to spend your remaining $690 is on pop-ups and markets. Pop-ups and markets are a great way to learn about your customers. They give you an amazing opportunity to connect directly and hear what people think about the goods you are selling. This information will help you to tweak your product in the following seasons and sell even better.
Take your time choosing a pop-up or market. They are not all created equal. To get real, many are a waste of your time and money. So do your research, visit the markets. check out booths that have similar products to you, are they busy. Stop by and strike up a conversation with some vendors, how have sales been fro them. Most other small businesses will be honest with you if you tell them you are searching for yourself. There is a secret unspoken bond of solidarity. We are all trying to make it so why not help each other out. I have been told outright by brands, do not do this market, I am so annoyed I wasted my money on this, etc, etc. So learn from other mistakes.
Reinvest In Yourself
As you start selling you can even reinvest your sales money into more promotion or more inventory for your brand with reorders. And, remember, you still have that $1000 for a rainy day if something comes up.
And There You Go...
How to start a fully functioning clothing line at only $8000. I know some of you might have different budgets. Many of the brands I work with at virtue + vice have at least 20k saved up. That is why I made this easy downloadable budget exercise for you to use with your own budget.
If you have more cash you can spend it on all of the other bells and whistles that will help you do business and your company grow that I mention in the guide like showrooms, product photographers, advertising budgets, etc.
1 comment
This was awesome and helped me out a lot. Thanks.
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