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5 Business Challenges Fashion Start-Ups Must Overcome

As a fashion entrepreneur you must overcome many business challenges before successfully launching a new brand. Five challenges stand out as essential to your success. If you can solve these, you will establish a solid foundation to launch, build, and scale your new fashion brand.

If you’re a fashion entrepreneur or a designer with dreams of launching a new line there are going to be many challenges, roadblocks, and hurdles that you need to navigate around. In this blog, we will identify 5 primary challenges every fashion start-up must overcome before making a successful launch. 

These challenges are: 1.  defining your niche and target audience, 2. developing a unique brand identity, 3. establishing a supply chain, 4. developing a marketing strategy, and 5. creating the right financial and accounting structure. If you can successfully solve these issues, you will be able to build a new brand, launch it, and scale it when it begins to grow and expand. 

Define your Niche and Identify your Target Audience:

The first challenge for any fashion start-up is to define your niche and identify your target audience. A start-up needs to identify your brand’s “WHY”. Why does it exist? Who is it for? What problem does it solve? Why is this such a desired benefit? 

Defining how your product fits in the market and who is the ideal buyer is as important as the idea itself. It should be the primary focus of the start-up’s marketing strategy. Without a clear understanding of your target audience, a fashion start-up will struggle to attract and retain customers.

To define your niche, it is important to conduct market research. If you can spot an unfilled need and identify the potential buyers who need it, you may have found a promising niche. It is important to identify the potential competition and know them better than they know their own product. It is also essential to analyze the demographics, psychographics, and behavior of your potential target audience. By understanding your niche in the marketplace, analyzing the competition, and  knowing who your ideal buyer will be, you can tailor your brand, product line, and the marketing methods and messages necessary to connect with your audience and build brand loyalty.

Develop your Brand Identity:

The fashion industry is highly competitive, and new brands need to stand out from the crowd. Developing a unique brand identity is essential for any fashion start-up. A brand identity includes the name, logo, packaging, and overall design aesthetic of the brand. It should be memorable, visually appealing, and resonate with the target audience. 

Your brand identity can also reflect your beliefs and values. Many beauty brands, including E.L.F cosmetics and Milk Make-Up are “Cruelty Free”. Some fashion brands, including Patagonia, promote their commitment to sustainable processes and using only “fair trade certified” manufacturers. Other brands,  like Rothy’s footwear, makes its shoes from recycled plastic bottles. 

To develop a unique brand identity, you should consider your target audience and identify what is important and appeals to them. Your brand identity and story should be consistent across all marketing channels, including your ecommerce website, social media, physical packaging, and advertising messages.


Establish a Reliable Supply Chain:

A successful fashion start-up needs to have a reliable and efficient supply chain. The supply chain includes the sourcing of materials, production, and delivery of products to your customers. 

Your fashion brand needs to ensure that your suppliers meet your quality standards and can deliver materials on time. It is also important to establish an ordering, production, and fulfillment system that is efficient and cost-effective. Establishing a supply chain can be challenging for a fashion designer or entrepreneur who does not have fashion industry experience. It is very important to quickly develop relationships with suppliers, negotiate contracts, and establish quality control measures. 

At V.Mora, we often help fashion start-ups find reliable vendors, suppliers, and manufacturers. We have a vast amount of experience in the fashion industry, and a large list of people and companies we have successfully worked with in the past. It is very important to ensure that your production and fulfillment process is efficient and can meet customer delivery demands on time. It may take time to get the experience required to establish a reliable supply chain, but it is essential for the success of any fashion start-up.


Developing and Implementing a Marketing Strategy:

Many fashion designers and start-up entrepreneurs get so focused on the design and manufacturing of their product that they neglect marketing. In order for your fashion line to successfully launch and sell, you must develop and implement a marketing strategy right from the start. It is critical to reach your target audience and connect with them before you even have your first sample.  If you can do that you will develop a larger audience of potential buyers who are hungry for the product line you are launching. Those early customers will sustain you and help ensure the success of your launch. 

The marketing strategy must be tailored to the target audience and always support the brand identity. It should include a mix of online and offline marketing channels, such as social media, email marketing, and an ecommerce website. You should also experiment with influencer marketing, trade shows, and other fashion events.

It’s important to allocate a portion of the initial budget for marketing. You will need to test often. Testing allows you to measure and analyze which channels are most efficient and effective in connecting with your audience, creating desire, and developing brand loyal buyers. 

As your audience grows and your product development advances, analyze your marketing strategy.  You can then make data driven adjustments based on your test results, product development, timeline, and understanding of your customers needs and habits. .

Build a Solid Financial Structure:

Creating a solid fashion business that can grow, expand, and help make you financially free requires a solid financial structure. It does not matter whether you are self funding your start-up or bringing in investors. You must establish a financial system that can keep track of sales, forecast cash flow, handle orders, and handle all financial matters.

The accounting system you create is extremely critical to the success of your fashion brand and how it can grow into the future. Investors who know you are financially dependable will be more willing to invest in you for future products. There are also federal, state, and local taxes that require accurate bookkeeping. 

A successful start-up needs to have a solid financial plan and manage cash flow carefully. It’s important to balance expenses with revenue and also try to accumulate enough capital to grow your business as it succeeds. Right from the start, you should develop a financial plan that includes a budget, cash flow projections, and revenue targets. You should also consider the different sources of funding available, such as personal savings, loans, grants, and investors. It is essential to keep track of expenses and revenue and to make adjustments when necessary.

Fortunately, there are some very good accounting software programs you can simply buy off-the-shelf. QuickBooks is one example of an off-the-shelf solution that can help a start-up fashion business handle reliable and accurate accounting. It can even assist with special reports, invoicing, and much more. 

As a fashion entrepreneur, you need to be a very creative and practical problem solver. Many challenges will confront you as you move from concept to your first sale. If you can successfully identify your niche and audience, define a consistent brand identity, develop a reliable supply chain, create and implement an effective marketing strategy, and build a solid financial accounting and tracking system, you will clear 5 essential hurdles that could block your future success. When you have these in place, your start-up will launch on a solid foundation, and can grow and scale as your brand develops. 

What’s your breakthrough fashion concept? If you feel you have an idea that may have some promise, schedule a free strategy call and let's talk about it. You may have discovered a niche and a fashion product that could become a successful start-up and the fashion business of your dreams.

Stuck on product Production? At V.Mora we can help you through the entire production process from designing, to sourcing and so on through our Production Development services. If you are in need of the following Development and Production services: 

  • Sourcing 

  • Technical sketches   

  • Pattern Making

  • Prototype making 

  • Sample Making

  • Fittings 

  • Digitizing and Grading

  • Marker Making

  • Manufacturing



Please contact us at: vmorainquiry@vmora.com

About the Author

Fashion expert, Allison Howmann, graduated from the Fashion Institute of Technology where she majored in Fashion Design and Minored in International Trade and Marketing. She has spent over 6 years in the NYC Fashion Industry utilizing her Design and Marketing skills. Allison has worked with several successful brands to help create their winning fashion development, small business operations, and sales and marketing strategies. You can find her creating original content on the V.Mora blog and the V.Mora Instagram.