Fashion business information, advice, guidance, and education for fashion brands
I'm not looking to raise money or bring on investors so why do I need one?
This is usually the response that we get when we ask designers if they wrote a business plan for their new start-up fashion brand.
Quite frankly, I don't blame them for thinking this way, I myself thought the same until I started my fashion brand.
When I first heard about cash flow in relation to my fashion business I thought to myself: What does it have to do with fashion??? I went to fashion school not accounting, right? ....Just checking.
And my ego added: I have a great style, people love my designs, they'll buy them and my brand will be successful...
As I mentioned before...I made quite a lot of mistakes with my fashion brand and paid heavily for them, the above was one of them.
What is cash flow?
Cash flow is the net amount of cash moving into and out of a business.
How many products will you need to sell in order to cover your cost and at what level of sales will your business make a profit?
To answer this you will need to calculate and find what is the breakeven point of your business.
Breakeven point (or breakeven analysis) is the point in which expenses are covered, and anything that is sold above that point means that your business is making a profit.
Calculating the breakeven point is done by defining the relationship between expenses and revenues and understanding how expenses/cost will change as sales increase or decrease. Let’s look at how it’s done.
I am currently reading the book Great By Choice. In this book the authors, business researchers: Jim Collins & Morten T. Hanson, enumerate the principals for building a truly great enterprise in fast-moving times.
What are the key points for building a successful business? Is it innovation? Do you need to be a geniuses leader who can predict the future? Is it a question of money?.....Is there a secret that we should all know of?…… maybe it’s just pure luck after all???
Spring 2015 market is just around the corner, how is the sample making process going for you so far? Hopefully your collection is coming well and on time. A major next step for you is pricing your products right to make sure you are making a profit. So as you are getting your cost sheets ready and to help you avoid this bad experience here are 5 points to consider while costing and pricing your fashion line:
