Too Cool for School...

A fashion business consultant I know put it best..."When it came to social media and technology the fashion industry was just too cool for school....now we're trying to catch up."

For a long time technology and high fashion just didn't mix. We falsely believed doing too much with social media and technology would appear desperate and shameless.... Tech just wasn't sexy. I mean after all even the last time we saw our high fashion sweetheart Carrie Bradshaw she was using a payphone for goodness sake (seriously).

Now it seems practically overnight fashion fell in love with technology..Not having a blackberry or an iphone has become in a word...tacky (ouch...i know it sounds so snobby...). Social media savvy designers like Tory Burch and Rachel Roy have become new media"it girls"...and not having a website is like well...not having a company...(now that's just the truth...)

So what's a smart fashion company to do? You can tell by the frequency or lack thereof of my blog that I am no social media guru. However fortunately I had sense enough to partner up with one.....

So I want to introduce you to Macala Wright Lee of Fashionably Digital Los Angeles. I don't often plug people...but I must admit I've never met anyone who eats-- breathes and sleeps with fashion...and understands the technology space inside and out to boot. She knows....Who's who? What's what? What's next? And even what's after what's next? And lucky for the less tech savvy (i.e. me) she is literally a walking, talking, blogging, tweeting encyclopedia of everything fashion/tech related anyone ever want to know.

So if you want to stay in the loop or get in the loop start by following her uber educational twitter @fashmarketing or check out her new site http://www.fashionablydigital.com./. You'll learn a lot...I know I do.l...everyday. Thanks Macala!

Launch Your Line!

Is launching your fashion line on your list of New Years Resolutions?

Why don't you go ahead and really to it...

The seminar I'm doing on February 3rd will show you how to get your fashion dreams out of your head...and into the stores.

Starting from the very first step we'll discuss how to do it...what you'll need and who can help.

Of course it's not easy...but you know the saying...A journey of a thousand miles starts with one single step.

Take that first step with me this February...

Click here for more information and to register.

Hope to See You There...

Half of Success is Showing Up...

At a very successful company I used to work for, which I'll refer to as Andi James, the owner, Andi would always go to trade shows with the sales reps.

I am no less than positive most of the reps found this completely annoying. I mean didn't he trust them to do their jobs? And furthermore weren't there a million other things he could have/should have been doing than hanging around and giving buyers that fake European kisses on the cheek-- asking them about everything from their businesses to their kids.

Yes he was already very successful...his name was big but even like Mega star Beyonce (personally promoting her line at a trade event in the pic above), he always seemed to realize he was no bigger than the people who supported him.

In contrast I've seen many designers ship off their sample lines to a trade show in a big UPS box then wait by the phone to hear the sales rep either show and prove with some great orders or ramble on about how the show was slow and people just weren't buying.

The message in all this is to be involved with your showroom and the entire sales process.

The relationship with your showroom is a partnership but obviously an outside showroom is not your company. And if for whatever reason things don't work in the short or long term it will have been important to have always protected your interests.

So what are your interests?

1. Your Relationships. Andi went to those trade shows to build personal relationships with buyers--that could possibly outlast his relationship with the showroom. He made it clear that he appreciated their business and was there to personally stand behind his company. He understood his customers were his everything...much too important to be left entirely in the hands of another.

2. Your Insights. In most organizations the sales people are the biggest knowledge keepers. Yeah you can look at the numbers but the people on the front lines are the only ones who know the whole story. Why isn't this selling? What makes this piece so hot? The non-verbal cues, expressions, side comments they all add up to a full picture that can be translated into action steps to grow your business. Insert yourself in the mix and get these insights for yourself.

3. Your Visibility-- The press are a staple at trade events. They want to get good interviews and create interesting stories that can be turned around as quickly as possible. Would it be better for you...or perhaps the entry level sales assistant the showroom has dedicated to your line to help build intrigue, give quotes and secure press coverage? Don't leave it up to your sales rep or your press kit...go to the show and make your story come alive.

All this being said, of course there is a right way and a wrong way to do everything. Having a good relationship with your sales partners is of the utmost importance as well. You definitely don't want to piss them off prancing around like an uninvited diva.

Perhaps you only attend the largest events, and only stay for a few hours during peak traffic. Also talk to the sales manager about the best role for you to play....Silent observer? Special guest? "The designer wanted to travel here and personally greet our customers." Buyer thinks...what a nice touch..none of the other designers came... Hey I've always wanted to ask you..yada..yada..yada...

You get the picture. Play your position. You are the owner, which means at the end of the day the whole shebang is your responsibility. If things go left there is really no one else to blame. And even if there was you can't really take blame to the bank.

My bottom line--Take some time to stay personally involved in the sales process...you can't afford not to.

Fashion Financial Forecasting

Fashion Financial Forecasting

A Simple Way to Project Profits for Your First Season and Beyond…

Since fashion is a passion driven industry many entrepreneurs find it hard to resist the temptation to overestimate potential sales. I do agree..its only fair to believe that if you put your heart and soul into your collection that it will fly off the shelves and be the next big thing.

But at the same time if you rely financially on this wishful thinking it could leave you up the proverbial creek without a paddle. Many new brands have the idea that if they could just get started…big profits will jump in and help them fund their operational costs.

Unfortunately unless you’re operating a very grass roots business it can take quite a while before profits become a signfigant source of funding. Many times for boutique driven lines profiting even 5K in the first year is considered a big stretch.

So how can you determine some legitimate possibilities?

Here’s a simple eye-opening exercise you can do to figure out your likely bottom line. I’ll illustrate the process by brainstorming some rough but realistic projections for the 1^st season of a high end clothing line….

Step 1: Think about your strategy.

Since we’re talking about a higher end line in this example let’s assume for the 1^st season we’re focused on selling to a hand-picked batch of boutiques. Getting the big volume business of department stores is unlikely to happen in any company’s first season.

If you hire a salesperson since they know your market they may be able to clue you in as to how many stores you’ll be able to get into your first season as well as the average number of pieces a store may buy. These numbers will be the foundation for your financial estimates.

In this instance based on our sales strategy we estimate we’ll be able to land this line in 10 boutiques. Be careful in exaggerating this number. Many buyers are hesitant to buy from spanking new lines…so you’ll need time to build momentum.

Step 2: Set your profit margins.

Keep in mind…the only money you will make exists between the production cost of your product and the wholesale price you sell it for. This is your profit margin.

Start by doing the math to determine the average profit margin for your line. To do this first tally up all the costs it takes to produce your product (fabric, cutting, sewing, trims, hangtag, shipping…etc).

Then set the wholesale prices that you will charge retailers for your product. For this you normally work backwards from your suggested retail price. You want to ensure whatever you sell your product to retailers for that they can mark it up at least 120% to get to your suggested retail price.

Step 3: Get to the Bottom Line….

To get come up with a bottom line you’ll have to induge yourself in a few more basic calclutions…

In this example we’ll assume the average cost to produce our products is $20. And based on our positioning in the marketplace our average retail price is $80.

Working backwards we know in order to allow our retailer to markup to our $80 retail price (again a fair markup is approx 120%)….. we’d have to sell our products to retailers at a wholesale price of about $36

That gives us our average profit margin---- $36 (wholesale price)- $20 (production cost)= $16 per piece profit margin.

To take it a step further….since the boutiques we sell to are small ----based on our sales strategy we estimate each of the 10 stores will buy about 12 pieces. (again…sales reps can also give you an idea of an average order size # so its most realistic).

Finally we get to our overall projection…

10 stores x 12 pieces each x $16 (profit per piece)= $1,920 seaonal profit.

And just for the fun of it lets knock off 15% for either sales commissions or sales costs.

That leaves us with grand total profits of $1632 for our first season.

We’ll also probably end up deducting from this final number with things like damages and discounts as well.

If the potential profits you come up with just won’t do…. you can do things like tweak your costs, position your brand for a higher retail price, or decide to produce a collection that is more likely to result in higher volume.

By doing this bit of mental legwork beforehand you can be much more proactive in adjusting your strategy and ensuring you’re financially setup to succeed.

New Designers Need Love Too...

Yes…we know, getting exciting press for your new line can often feel like climbing a hill in stilettos.

It’s elusive….People know people who know people who know people. And maybe you’re not one of those people….just yet.

So what can you do? The talented yet un-connected new designer that didn’t go to boarding school with the assistant editor at Vogue and a has a budget that would make any respectable publicist literally LOL.

Start by tapping these budget friendly online resources that can help put your brand on the map….

1. Thecontactlistonline.com–Getting connected starts with getting contacts. The Contact List is a subscription based service that keeps you in the loop of who’s in and who’s out in the ever-changing world of fashion. With The Contact List fashion and beauty editor names…emails and addresses are just a click away. And even better their monthly rates start as low as $15 bucks.

2. Buzzflikr.com –This innovative online PR service focuses on providing low cost web-based PR to emerging designers and brands. By posting your media kit and images in their “hive” you’re instantly on the radar of story-hungry fashion editors and bloggers around the globe.

3. Thefashionlist.com–Feel like you always read about the hottest fashion events after they’re over and done? Are you ready to expand your network and get in the know? The Fashionlist.com is a comprehensive database of all the biggest happenings in the world of fashion in one central place. Plus you can even post your own event totally free.

Change You Can Believe In...

There's a case to be made for the small business these days. While big corporations are going through these massive restructuring plans to stay afloat--and small businesses certainly have their vulnerabilities they also have one big commonly overlooked advantage.
Flexibility....

"I can change in a day," a successful small business owner once told me. He looked around his small office, snapped his fingers as if to drill his point home and said again,"If something stops working out...I can change it all in a day."

While his statement may have been a bit of an exaggeration, his comments do have an interesting underlying question. In these challenging economic times how many small companies are taking advantage of their unique opportunity to change in a day...a month..or next year for that matter?

Many of the fashion business owners I encounter are just trying to keep what they have, lower prices, push the sales reps, find new production.

However maybe now is the time to pull out that small business trump card and "Change in a Day!"

So who's going to dream up all this change..as if the small business owner doesn't already have more than enough to do? Well as the saying goes "Fish can't see water." If you're in the trenches of running your everyday operations you may not even know quite where to begin...

Why not get some outsiders involved to give you some ideas to create change you can believe in....

1. Hire Some Bright Interns--And not to answer the phones, file or fax. Encourage them to share ideas, give feedback and even have a pet project. Schools like, The Fashion Institute of Design and Merchandising allow employers to skip the clutter of craigslist and post opportunities for interns directly on their website.

2. Meet with a Consultant--Why not get the assistance of someone that knows how other companies have managed to succeed and fail. Many times their insider perspective can make the difference between a golden parachute and feeling like your business is trapped at the bottom of the ocean with an iron anchor. You can find these helpful industry insiders presenting seminars at trade shows and other industry events or you can check out Fashion Business Inc Consultants that may be able to help.

3. Get Some Free Business Advice--Score.org is an association of retired executives that helps small business owners plan and assess their businesses completely free of charge. Maybe you need to revisit your business plan...or maybe you never even had one to begin with. Now could be the perfect time to rewind and restart. Get the scoop on score and its services at www.score.org.

Rockin it Out...in a Not so Hot Economy

Driving by this beautiful new Rock and Republic store the other day on L.A's Robertson Blvd.; I had to take my hat off to them for having the courage and the money to make such an investment in their brand within this shaky-bakey economy.

I can't say whether it was a smart business decision or not...but if that shiny metallic building could talk it would have said..."Rock and Republic is a strong brand...the economy is bad but we're still hot-like-fire" And if I were to go in there and drop a couple of hundred bucks those would be exactly the words I needed to hear.

For a smaller company that statement will probably not come in the form of a who-knows-how much it cost--gorgeous store front on Robertson Blvd.--My point is that you do have to find the courage to keep branding. Branding being that constant conversation that you have with your customers.

What things about your brand can you freshen up...to let your customers know you're still innovating--still growing and will be around for the long haul? Newly designed shopping bags, special labels, non-desperate beautiful marketing communications pieces.

Whatever it may be now is a good time as ever to add a little spark of life to brand image. Take some time and brainstorm how you'll let your customer know investing their precious fashion dollars in your brand is still a good bet.