How to Start a Fashion Retail Business

Decide how you will set your store apart.

Are you obsessed with the latest fashion trends? Do you scour fashion magazines to catch next season's hottest fashions? Are you someone who is motivated and enjoys hard work? Then starting a fashion retail business may be your calling. The fashion industry is cutthroat and some longtime retail stores are on their way out. To ensure this doesn't happen to you, have a thorough plan.

Things You'll Need

• Insurance
• Location
• Staff
• Merchandise
• Sales tax permit
• Business license

Instructions

1. Start with a business plan. Ask yourself what you can bring to the industry that hasn't already been addressed by the hundreds of popular retailers. Retail businesses fail due to poor customer service, poor business planning, failing to set their business apart, and failing to understand their customers. Avoid these pitfalls by identifying a niche. Do this by narrowing your audience. This also will reduce your competition. Your fashions won't appeal to everyone. Don't waste time trying to get 100 percent of the market. Focus on a demographic segment and take steps to satisfy their needs. Then continue to offer products at a quality level and price that they can count on. For example, you might provide high-end designer jeans, shoes and accessories to middle or upper-class professionals or their teenage daughters.
   Generally, the products you sell should be consistent in quality and price. If your target audience is lower to middle-class women or young moms, price is much more important.

2. Visit competitors and study their clientele. Learn which fashions are most popular, which fashions are paired together and how much these items cost. Get an idea of what you can expect your customers to pay for certain items. Analyze why one store gets more traffic over another. Take note of décor, displays and sale signs.

3. Scout a location for your retail store based on your target audience. A high-end boutique belongs in an upscale shopping center or galleria. A mid to low-range retail store would do well in an indoor or outdoor mall.

4. Register your business at your local county clerk's office. Obtain a sales tax permit, building or occupancy permit and a federal tax identification number. Familiarize yourself with the federal and state labor laws. Consider hiring an accountant and attorney to help you map your tax liability and other legal issues.

5. Purchase equipment for your store: signage, display tables and racks, shelves, a cash wrap, mirrors, dressing room curtains, mannequins and benches. Stick to your budget. When purchasing inventory and décor for your store, it can be easy to get carried away. Once your business takes off, you can update fixtures and mannequins. Purchase cutting-edge, fashionable merchandise. Consider jeans, dresses, t-shirts, jewelry, shoes, handbags, cell phone holder, wallets and body art. Don't overbuy your inventory, you don't want to be stuck with out-of-date styles when the season changes.

6. Purchase insurance for fire, theft and damage, liability insurance, product insurance and worker's compensation insurance.

7. Contact a merchant account provider about setting up a merchant account, obtaining your cash registers and incorporating an inventory control system. Take advantage of any accounting tools they may offer to help you track your payroll and expenses.

8. Hire a fashionable and personable team. You'll need at least one assistant manager or key holder and a handful of salesgirls. They should be capable of making fashion suggestions when prompted by customers.

9. Hire a designer or ask fashion-savvy friends, family or employees to help you decorate your store. Never leave a display or mannequin unclothed, it looks tacky and means that you've lost a chance to display an outfit. Change displays every few weeks.

Tips & Warnings

• Consider offering rewards cards and coupons for future use. Subscribe to fashion magazines to get the most up-to-date information of upcoming trends. Train your employees to ensure that they know what your expectations are for excellent customer service. To reduce theft, put a security system in place.

References

• How to Start a Clothing Store

Resources

• Retail Store Supplies and Fixtures
• Latest Fashion Trends