Over the last few months we have met many manufacturing experts, consultants and entrepreneurs. When we ask what is the number one thing brands under estimate when starting a product business, the results boiled down to two reasons: budgets and timelines. So on our most recent webinar we invited Syama – sales, marketing and merchandising specialist for wholesale, ecommerce and brick & mortar.
Syama walked us through realistic expectations for timelines and budgets. Timelines and budgets are the two things entrepreneurs underestimate and the top two reasons they stop pursuing their business. I would recommend you watching the full webinar below, but we also took the top tips to share for you!
1. Know your price point and marketing assortment. You should know what demographics you want your business in and what market you are targeting. This will serve as a foundation to build up the rest of your business from that point of view.
2. Understand the business model. Be sure to allocate for a production consultant to help you build out your samples. You might also need a designer if you didn’t come from design background. Trade shows are common and run around $7,000. Photoshoots are essential with every new collection and usually cost $5,000-$10,000. Lastly, plan for both ecommerce and in-person marketing.
3. Cashflow is not just a list of expenses, but also generates predictions for sales and revenue. There are two types of expenses to account for. Your fixed costs are the things that your business cannot live without. Variable costs are all the levers you have to pull to make that sale or create brand awareness. Keep a budget in mind for building out your website (possible up to $9,000) and developing your brand.
4. Operations and logistics. What will be your costs to have an inventory management system? What back-end technology will you have to integrate in order to run your ecommerce business?
Over the course of 18 months here are the important milestones to consider:
1. The date that you decide you want to start a business – Give yourself 9-12 months to research, flesh out your ideas, and create a sample of your product(s).
2. Brand building phase – Branding is not just a logo. Branding means understanding the touchpoints of your entire consumer funnel. So, allocate 6-9 months for defining your brand, logo development, social media, strategy, etc.
3. Development of outbound facing strategy – Before your website goes live you will need to have a photoshoot, sales and mktg strategy. Allow one month between when your website launches and when you can take orders. This allows you to have a buffer for test ordering on site and to push PR.
After you go “live” you only have about 3 months to say your brand is “new.” After 3 months, you’re already in a new season in fashion. So understanding retail cycles and how they overlap is critical. You will be working a season in advance if you are doing wholesale/retail.
Maker’s Row community not only consists of manufacturing partners, but also marketing and business strategists to help you sell your product from branding to retail.