1. Do You Really Want to Start a Fashion Business? | #BoFEducation Video Lecture | How to start your own Fashion Business: Fashion Business Basics - Entrepreneurship

welcome to the business of fashion
basics we're here today to talk about
setting up a fashion business but before
getting into the nitty-gritty of how to
run a fashion business I thought I might
start with a reality check and that's
really to answer the question do I
really want to run a fashion business or
rather do you really want to run a
fashion business there's a lot of things
you need to know about running a fashion
business even before you start and you
know these are some of the things that I
I think people should think about first
of all it takes a lot more money than
you might think you're running a fashion
enterprise even a small one requires
capital and it requires money to make it
work now capital and money don't
guarantee success but without access to
capital and access to funding running
and growing a fashion business can be
very very difficult that's not to say
that you can't find really creative
enterprising resourceful ways to find
capital and to kind of access funding
but if you don't have the building
blocks of capital to help you know
finance and grow your business to hire
staff to buy materials to work with PR
company to set up a website all of those
kinds of things a lot of those things
require money and so the amount of money
that it takes is often more than a lot
of people realize so that's the first
thing you should know the second thing
is that you know running a business any
kind of business whether that be a
fashion business
or you know and another kind of business
as an entrepreneur you will basically
live eat breathe sleep and die by your
business running a business is kind of
an all-consuming 100 percent commitment
and as your business grows and as you
start building a team you'll find that
not only are you worrying about the
business you're also worrying about
people and you know running that kind of
base of it's a very intense
and I think oftentimes that's not
something that people are taught in
fashion school is not something that
you're taught in a lot of places but
unless you realize the commitment that
you're making by going into a business
in in advance and the kind of time and
energy and passion that it takes people
can often find themselves really really
surprised a couple of years down the
road when they're swimming and stuff to
do and they they don't they didn't
realize what they were getting into the
third thing is you know and this this
really makes fashion quite a distinct
business from a lot of other industries
there's a lot of attention on the tech
industry right now and you know you hear
these stories of a guy in a garage
comes up with some algorithm or some
kind of app idea and like the next day
you know they have millions of users and
you know lots of money and you're there
on the front page of Wired magazine the
fashion industry and in fashion business
almost by definition they take longer
you know it's a long term commitment
you're making building brands which is
essentially what a lot of you will be
aiming to do in the coming years it
takes time and that's something that you
have to understand but it's also
something that the the people that you
work with have to understand the the
different parties and partners that you
work with have to understand fashion
businesses are not created overnight
they take years and years and years and
you know without recognizing and
understanding the amount of time it
takes people often don't really think
about what that means in terms of that
my previous point which is that you're
going to be eating and living and
breathing your business for a very very
long time this is often the probably one
of the most surprising points for
designers is that actually you'll
probably spent less than 10% of your
time designing and in a way you should
really be thinking of yourself as a CEO
or entrepreneur first and a designer
second even if you are the creative
person in your business and you know the
the ideas and the the designs are coming
from your vision you'll also have to
spend a lot of time doing other things
that perhaps you haven't been trained
for perhaps you don't like and perhaps
you haven't really thought about it in
advance and you know I've mentioned
managing people but that also means you
accounting finance HR marketing you know
a whole myriad of things that you know
some of these words might not even be
clear to you in your head of what they
mean and hopefully through this series
we'll be able to you know provide a
little bit more detail on that but you
know managing and running a fashion
business is 90% about things other than
design and so you really have to be
comfortable with the idea that actually
if you want to be a pure designer if you
want to spend all your time designer
perhaps running a fashion business isn't
the right place for you you could go
spend a hundred percent of your time
designing in someone else's business and
leave the management to them but if you
are going to build your own business
you're going to have to find a way of
balancing your interest and and
motivation to design with all of the
other things that makes your design
sustainable being an entrepreneur also
demands what I call militant self
discipline there are no people managing
your deadlines for you there's no
professors or tutors you know reminding
you regularly about you know your
assignments that are due
there's no one to wake you up in the
morning or to make sure you get enough
sleep at night all of it comes from you
the discipline to build and run a
business has to come from your own
motivation and your own passion to run a
business and so you know when you're
thinking about starting your day and
thinking about all the things you have
to do I mean you you'll have to want to
get out of bed and get it all done right
and there'll be certain days when you
don't want to you're not feeling well
you're feeling tired you're not feeling
motivated you had you know a bad a bad
night or you know something's going on
in your personal life and you'll have to
put all of that aside
and put your business first and that
means being disciplined about it
and that's really about character so
often when I meet young designers who
are just starting out you know in
addition to their designs and their
creative ideas I'm also interested in
their character do they have the
motivation discipline integrity and and
focus to really be an entrepreneur and
that's something you should really think
about young people who dream about
building fashion businesses or becoming
fashion designers really without the
kind of thick skin and and toughness to
work in this industry which is a very
very competitive industry especially now
that the the profile of the fashion
industry has grown so much and you know
and everybody see shows like Project
Runway and other exposure to the fashion
industry which is really opened up so
many more people are interested in
fashion and that makes it even tougher
to succeed even harder to make a mark so
you have to be tough you have to really
really be able to stand up and say you
know I'm going to do this even if you're
feeling not so confident even if
something's gone wrong you have to give
the idea of confidence and toughness
that you can do it because that's what
people will look for buyers will look
for that in you when they're evaluating
your collection is this someone I'm
buying into I'm not just buying into
their collection I'm buying into the
person especially as young designers
because so many of these retailers have
been burned by designers who just don't
deliver right so they're going to be
even harder on you they're going to be
even more exacting so you have to be
tough and finally the reality is that as
a especially if you're the sole founder
of a business you know you're kind of on
your own especially at the beginning
when you're just starting out and you
might have you one or two interns or you
know one or two part-time employees
working with you
you often can find it a very lonely
experience you know being that person at
the at the helm of your brand and you
know it's interesting because I think
from the outside people look at young
fashion designers and they think wow
it's so glamorous you know you get to go
to parties you get to hobnob with the
rich and famous you get to meet all of
these exciting people but at the end of
the day you leave that party you go home
you sit and you think about what you
have to get done the next day and
there's no like I said earlier there's
no one who's going to be you know
monitoring or managing you you have to
manage yourself and if you're doing that
on your own it can be quite lonely those
are the things you should know before
you start a fashion business another
thing that I like to cover at the very
beginning when talking to young
designers about setting up a business is
something I call the life cycle of a
fashion business
what is the life cycle of a fashion
business at the very early stage of a
fashion business it's all systems go
you're out pounding the pavement and if
you're lucky and perseverant within the
first few seasons you've got a couple of
stalkers and some press attention your
business may be gathering momentum but
it's at this critical time that many
fashion businesses begin to run into
challenges either they run out of money
because of cash flow problems or they
aren't able to deliver their collections
on time because they haven't sorted out
their production or they give up because
it's just too much work in fact more
than 90% of fashion startups will fail
in the first three to five years but
this doesn't mean things are over for
you as a designer a lot of designers of
how their businesses fail but they
persevered and tried over and over again
until they figured it all out
the businesses that do go past that
three to five year time frame fall into
two groups some are small mature
businesses that continue to turn a
regular profit but fail to scale further
the others build a very special kind of
fashion business one that is profitable
continues to grow and have an impact on
the whole fashion industry so assuming
you know you knew all of the things that
I said that you should know up front and
you understand that most fashion
businesses aren't going to lost what are
the different elements of running a
fashion business we've talked about this
earlier in that as a fashion designer in
your formal education what they'll teach
you at st. Martin's or Parsons or the
Academy and Antwerp or wherever it may
be they'll teach you how to design
they'll teach you everything related to
design and development which is you know
the very first step of what I call the
fashion value chain what they'll often
not teach you is all of the other things
that need to happen after design and
development to actually make the
business work and I actually find it
surprising because your ability to
succeed as a designer in a fashion
business rests not only on your
creativity at rests on your ability to
do all these other things so let's talk
about the steps in the fashion value
chain the first as I mentioned is design
and development and you know very
broadly speaking that includes of course
designing a collection making patterns
you know developing samples you know
researching textiles and fabrics you
know understanding all of the elements
of research and development that come
into creating a collection that's the
first step that's the step that I think
you all know pretty well the second step
is then you know how am I going to
produce that collection at scale so the
people who are at the earlier stages of
their business because of the volumes
the low relatively low volumes of what
they're selling
you're able to make both your sample
collections and your commercial
collections in-house that can't last
forever right as your business grows as
you start selling to more and more
buyers what you'll find is you need to
find production partners to help you
produce your collections at scale and
that adds a whole new element of
complexity to your business because all
of a sudden the things that you're doing
in this kind of really artisanal way in
your studio or your Atelier you need to
find someone else who can do it in
multiple quantities often at a distance
from you and you have to manage that
relationship all of a sudden then you
have to worry about deliveries and
logistics and quality control so
managing and a production supply chain
is a really really critical part to
scaling a business an often designers
find it hard to work with factories
especially at the early stages because
they'll look at you and they say you
know you're only producing you know 10
units of this you know they're used to
producing in the hundreds or in the
thousands of units so again part you
some of the best young designers I know
they'll show up with their collections
to a factory and they will convince the
factory owner that they're worth
investing in because essentially at that
stage of development the production
partner is taking a bet on you you know
there's probably hundreds of young
brands that they could work with why
should they choose you well they choose
you because you have that something
special you have something distinctive
and they trust you right they believe
that you know you will be someone that
they can work with so again this whole
idea of character you'll see I'll repeat
it over and over again today but the way
you work with other people the way you
partner with people is essential to
building out your business in every step
so production and supply chain is about
sourcing materials and
fabrics you know managing logistics
delivery all of that kind of stuff then
you have this idea of marketing and
communication and you won't really be
able to sell your collection unless
people know it exists so how are you
going to create demand how are you going
to create interest in your products if
nobody knows about them and this is a
part of the fashion industry that's
really in a period of massive
transformation at the moment in the
pre-digital era fashion communication
and marketing rested almost 100% on
advertising PR and shows in the digital
age where we have social media we have
you know Facebook and Instagram and
Twitter and all of these other tools to
communicate about our collections
there's a whole myriad of options
available to you now to help people know
that your brand exists and excitingly
for young designers young businesses
most of those tools are free still up to
create content to populate the feeds
that everyone's looking at on their
phones all the time but if you have the
content if you have the ideas there's
really interesting and inexpensive ways
of building awareness about your
collections so you know this is where
the idea of brand development public
relations marketing presentations social
media all of those different elements
come together and then finally you have
this idea of sales and distribution
right if you've got the vision and the
ideas you've got the right production
partners you've created the demand or
interest in your products the last step
is to distribute and sell those products
right and that at the early stage of
your business will involve wholesale so
selling to retailers whether they be
online or offline retailers and
eventually could include
having your own retail either through an
e-commerce website or a physical store
and then there's also things like trunk
shows and other things you can do to
generate revenue and and sell your
collection but primarily we're talking
about wholesale and retail so those are
the four steps of a fashion value chain
design and development production and
supply chain marketing and communication
and sales and distribution what are the
critical success factors to building a
successful fashion business one bring
something unique to the market have
something unique interesting distinctive
to say and that's really you know at the
early stage of developing your brand
spend a lot of time thinking about that
and I think that's what fashion school
is about really a passion school you
should be really trying to hone your
point of view it shouldn't be
necessarily about commercial 'ti or
anything related specifically to
business building it should really be to
be about nourishing and nurturing your
creativity to build that team and start
with finding a business partner that you
can partner with to help actualize and
realize the business that you want to
build know fashion business is built on
the shoulders of a single person it
requires a team use your network of
contacts if you've been lucky to attend
one of these prestigious fashion schools
as many of you here have those people
are your network continue to build that
network over time continue to cultivate
those relationships don't be afraid to
ask for advice or ask for help you
oftentimes as you'll find hopefully the
same challenges that you're facing are
being faced by other people at the same
stage of their business there are some
lessons that you can learn from each
other and finally you know manage your
cash really tightly generate revenue but
also manage cash really really
carefully cash management is incredibly
important I've seen too many designers
in situations where they go and have a
bunch of orders that they've received
and they find that they just don't have
the cash to buy the raw materials to
deliver those orders if you don't
deliver the orders you shatter
confidence amongst the retailers and
it's very hard to build confidence back
once it's been lost
cash is really really critical that kind
of concludes the first lecture which is
like do I really want to run fashion
business and as you can see and as many
of some of you know in this room it's
really not easy but if you can think
about all of the things that we
discussed and think about you know
building the team around you you know
managing cash properly and having
something really unique to offer the
market then perhaps you're ready for the
next step
you