Geoff Krasnov offers apparel/clothing/garment manufacturing and sourcing news.

Thursday, May 03, 2007

Starting An Apparel Line

We receive 5-8 inquiries a day from individuals desiring to start an apparel line. Many of them start with "I need a minimum amount as I am on a limited budget" and then go on to say they want a line consisting of jeans, coats, swimwear, shoes, socks, blazers and purses. A recent inquiry requested mens and womens clothing including suiting, evening and wedding gowns, casual clothes, swimwear, and purses. They wanted a "reasonable manufacturer, possibly in China, that will know exactly what they are wanting . Although this is an extreme example, it does echo the theme of anxious potential purveyors of branded clothing lines.

Reality dictates the edict passed on to all of us in grade school. "Do your homework" was drilled into us for a reason. A custom clothing line not only requires a large initial investment for the apparel, but considerations relating to the funds needed for marketing, advertising, and negative cash flow for as long as two years. It requires a more than passing knowledge of fabrics, drape, shrinkage, fit and garment construction. Simply private labeling branded apparel may work for a graphics driven line, but as soon as you take the leap to full custom apparel you must be prepared to know the product explicitly. Any custom apparel manufacturer will need thorough and exacting detail on the fabric type, weight and content, the garment construction, the number of colors and quantities needed per color, the size range, packageing requirements, and any value added (garment dye, screen print, embroider, etc).

Many will ask us to quote an item with a generalized description. No manufacturer can provide an accurate pricing assessment without complete knowledge of the items mentioned above. Requesting a :eough idea" on pricing can be quite dangerous, as the answer, although caged in cautious language as a generalization, may make a decision for the inquirer, yet be as much as 40% off the mark. This is primarily true due to the unknowns of the actual fabrics cuttable width, shrinkage, and size range of the garment, which all effect fabric utilization. Fabric , as a cost componant, represents 40-55% of a garments cost(depending on the amount of labor that is required in garment construction).

The message here is you must do the hard work before inquiring if you want hard answers. The channel of distribution you plan to enter will dictate the price ranges the products will sell for due to competition. Identify that channel and determine the average selling prices at retail for similar products. Work backwards (go to for for a book on costing formulas) to determine your selling price and back out your required profit margins. That will provide you with a target price for your similar items. Bear in mind that if the competition is importing the items and they are a larger company that the likelihood you can match those prices in the onset is non-existant. This is due to their sourcing leverage on volume pricing overseas. It is more than likely you would have to take very low margins in the first year or two producing as you build your brand. Hence the planning for negative cash flow during that period.

Style Source is intent in assisting apparel entreprenours. Our ability to do so is limited when you do not have a complete picture to present. We suggest you avail yourself of the resources listed on our resource page( to develop a business plan that fully defines the scope and details from projections of products and cash flows to marketing to product definition. With that information we can hit the ground running!