Clothing store business plan
There are clothing stores in any city, even in the smallest settlements of Russia. In large cities of the country, you can open a clothing store that will bring in millions in revenues. The reasons for this are the high level of demand, a very large volume of the target audience, which is chasing new things and fashion trends. At the same time, in large cities, in addition to demand, there is a serious level of competition. Only by expelling it, there is a chance to stay in the niche and actively earn. To do this, you need to draw up a business plan for a clothing store, an example of which will indicate what investments will be required to open, what are the expected profitability and profitability of the project.
A clothing store is planned to open in a large city. The store will carry out retail trade in branded clothes of medium and high price categories. When opening a clothing store, it is important that the owner is well versed in fashion, fabrics, styles, trends, and this is to his liking. A high level of qualifications plays an important role in the prosperity of this outlet.
Working hours of the store: daily from 10:00 to 22:00, seven days a week and without a break.
Main target audience:
- Women from 25 to 45 years old (50%).
- Men from 30 to 45 years old (30%).
- Girls from 18 to 24 years old (10%).
- Guys from 20 to 29 years old (10%).
A unique offer for our customers - originals of products, an individual and professional approach of a sales assistant, a loyalty program for regular customers, seasonal sales.
Men's clothing (shirts, trousers, T-shirts, jeans, belts, sweaters, blazers).
Women's clothing (shirts, trousers, T-shirts, jeans, belts, cardigans, sleeveless jackets, skirts, dresses).
The purchase of goods will require at least 400 thousand rubles.
Main business risks
To minimize risks, you will need to analyze them at the very beginning of developing a business idea and be sure to include all costs in a clothing store business plan with calculations, where the return on investment will be determined.
Clothing is one of the essential goods, therefore this market segment is distinguished by a stable demand environment and high attractiveness, including for start-up entrepreneurs. Among the advantages are also a significant difference between the wholesale and retail prices for goods, the absence of the need to create special conditions for storage and a wide choice of suppliers.
Features of drawing up a business plan for a clothing store
The general scheme of business plans for any type of activity is approximately the same. However, in each specific case, these documents may seriously differ from each other. This is primarily due to the specifics of both the enterprise itself and the environment in which it will operate. The clothing trade also has its own specifics. Consider what aspects, and to what extent, a clothing store business plan should cover. The list of these aspects looks like this:
- In-depth analysis of the competitive environment. In order to decide on the choice of location, you need to make sure that the possibilities of your business will not overlap with the possibilities of competing trade objects located nearby.
- Analysis of consumer demand. To get an idea of how much sales you can count on, you should study the consumer opportunities and needs of potential buyers. In this case, it is imperative to take into account the seasonal fluctuations that the clothing trade is subject to.
- Select a business model. Based on the information received about potential competitors and probable consumer demand, it can be concluded which assortment of goods will be optimal.
- Select suppliers. This choice is also based on data obtained from market analysis and, in turn, determines the logistics scheme for the purchase and delivery of goods.
In this section, the business plan for a clothing store should contain full information about the store owner and his bank details. In addition, it indicates in what legal form the company is registered. There is little choice here, either a limited liability company or an individual entrepreneur.
But the main content of this section is a concise rationale for opening a clothing store. This means that there should be data showing the profitability of the project. These data include the following:
- Forecast of consumer demand.
- Information about the presence of outlets and companies in the area where the store is located that can compete with it.
- The difference between the purchase and sale prices of an item.
- Estimated investment required.
- The expected level of current income and expenses.
- Forecast for gross and net profit.
Study of consumer demand for clothing
The form of trade and the range of goods are directly related to each other. The main factor influencing their choice is the structure of consumer demand, which, as mentioned above, it is very desirable to find out in advance.
- Personal observations and impressions.
- Marketing research.
The advent of the Internet has spawned a new type of business that is rapidly gaining popularity. Its advantages lie in the minimum investment and lack of location. Despite the high competition, it still has free niches for development. One of the most popular is online clothing trading.
Advantages and disadvantages of an online clothing store
Online shopping has many benefits:
- suitable for those who have a small initial investment;
- a small rental cost (a warehouse can be located in any part of the city, small areas are suitable) or it absence at all at the initial stages;
- practically no commercial equipment is required;
- there is no binding to one place (you can manage personnel from anywhere in the world where there is Internet);
- flexible working hours;
- profitability (less costs than in an offline store);
- excellent prospects for regional entrepreneurs.
There are also disadvantages of this type of business, but there are significantly fewer of them:
- with a small assortment depending on seasonality;
- without high-quality advertising - no sales;
- losses in case of customer refusal from goods, if he was sent by cash on delivery.
Market analysis and competitor assessment
To open an online clothing store, you need to analyze:
- demand and demand for goods;
- niche employment;
- market development forecasts.
If you want to start your own business, a novice entrepreneur will not only have to draw up a business plan for a clothing store, but also take into account all kinds of risks. With the right approach, the enterprise will pay off within a year and begin to bring stable profits. Mistakes can become fatal and lead to rapid ruin, rather than improve the financial situation.
Types of clothing stores and their features
There are several aspects to categorizing. Depending on the number of suppliers presented in the store, there are:
- mono-brand option - outlets sell items of one brand, often under a franchise;
- multi-brand - a varied assortment is presented, there are clothes from several companies.
The second division is in the price segment:
- Premium class - has a high average check, but occupies a small market niche. The outlets are located in prestigious places, intended for people with high incomes and a certain social status.
- Medium level - characterized by stable demand. The trade margin is lower than in the previous segment, the prices of goods are quite low. The store can be located both in a shopping center and in a residential or office building.
- Lowest - includes second-hand, stock points. They are located in markets, in sleeping areas. The quality of things matches the price.
It is better for a novice businessman to pay attention to an enterprise with an average price policy. The demand for the product will be high, and the opening will not require serious material costs.
According to the option of selling clothes, specialists additionally divide stores into 2 categories:
- Stationary type - requires hiring personnel, paying rent. Suitable for beginners.
- Virtual - the development of an online store is more difficult, requires an active advertising campaign. The pluses include the absence of rent and salaries for employees, provided that the owner will independently process orders.
Important! With a minimum initial investment, you can start from your home showroom and later move to a stationary retail outlet.
Advantages and disadvantages of clothing stores
Every business has its positive and negative sides. The advantages of this format include:
For inexpensive clothing, as well as for food, demand remains stable regardless of the economic situation in the country. Sales are falling, but not critical, you will receive your small income even during the crisis. What can not be said about branded clothing stores that are closing massively during the difficult times of our economy. This article will present a business plan for a small clothing store.
The first thing to decide is with the target audience, and the main thing with its purchasing power. If you live in a small town where people have a low or medium income, then there is absolutely no point in opening branded stores, for example Nike, Adidas, ZARA, you simply will not have clients. At the moment, the most profitable solution would be to launch a cheap clothing store, with a dilution of the goods with positions with an average price segment. Thus, you will be able to reach the maximum circle of consumers, and at the same time maintain a high demand for the goods you sell.
I would like to note that the business of selling clothes, in comparison with the sale of food, does not require special conditions for storing goods and has a high level of margin. It is this factor that attracts many entrepreneurs to the clothing trade.
The second question is how you will start.
The first option is to launch a franchise outlet. At the moment, both in Russia and in Ukraine, the choice of franchises for the sale of clothing is quite good, and you can pick up something suitable for yourself. One of the advantages of such a start is the launch of a ready-made business, a clothing plan, having in hand all the calculations and examples of projects implemented in other regions of the country. Agree, a tempting offer, but not for everyone.
The second option is to become a sales representative from a specific clothing workshop in your area, or manufacturers from other areas. You can find such mini-productions using the Internet. One of the advantages is the purchase of goods at prices from the manufacturer, without intermediaries. And of the minuses - the same type of assortment.
The third option is to run entirely on your own money. In this case, the goods are purchased on wholesale markets. In this case, you will be the full owner of your business, and will not depend on a franchise or on a particular clothing manufacturer.
The third question is the type of clothing sold.
To begin with, you can focus on a specific category, and eventually expand your assortment. At the moment, there are several retail options that will build on your clothing business plan:
- women's clothing. Divided into segments: youth - up to 35 and for the older generation.
- men's clothing.
- children's clothing.
- sportswear or outerwear.
- a general store with all product groups.
In this business plan, we will consider opening a small clothing store that will target low to middle income customers.
The store will operate from 8:00 to 20:00. There will be 2 salespeople from the staff. An anti-crisis solution for today's realities.