How to Start a Clothes Shop

The first decision that needs to made when thinking of starting your own clothes shop business is whether to take over an existing business, with the possibility of re-branding the store and changing its image, or starting completely from scratch in a new premises, and having to build up your reputation and customer base form nothing. There are obviously advantages and disadvantages to both, which need to be weighed up carefully during the market research / planning stage. Taking over an existing business means you will have an existing client base of regular shoppers, but then if you are planning to re-brand and change the feel of the store, you may lose these customers anyway. Starting from scratch means your marketing tactics must be strong, to make sure there is enough awareness amongst local shoppers to drum up a decent level of business.

Once the premises have been secured, the next step will be to decide exactly what services you are going to offer to your customers. Will you be incorporating your retail store with an e-commerce site (online shop)? This will affect your customer base, and whether you will just be targeting local shoppers or whether your stock will be such that shoppers are attracted from further a field. The size of the premises you secure will determine the range of products you can offer; many clothes shops also offer a small footwear section, and you will almost certainly need changing rooms for customers to try on your clothes.

The products you sell will have the biggest impact on your client base. Will you specialise in menswear, womenswear, children’s clothes or a mixture of them all? Will you be teaming up with a manufacturer to produce your own designs, or stocking designer clothes from a range of labels? Many clothes shops offer an alteration service, especially for items such as jeans/trousers - will you do this in-house or outsource the work? Other store policies such as returns/exchanges can be just as important, as your reputation can be built up with a good level of customer service. Will you allow a set period up to which items can be returned for a full refund? Or will you only offer credit notes, to make sure the money is kept in store?

Pricing is obviously a key strategy that needs looking at, as you need to make sure the prices you charge are high enough to cover your overheads and other costs, but low enough to make sure customers aren’t put off. Obviously, with designer clothes, you can afford to charge a higher price as your clientele will be able to spend the extra money, but if this is the case you need to make sure the location of your shop is somewhere where designer clothes may be in demand (i.e. a city).

Business Angels offer a different form of lending to the normal channels such as banks or venture capitalists. In return for their injection of capital, they demand a percentage share in the company, or equity stake. On top of their money, they also provide often expert advice and use their experience of the market to help you with your day to day running and long term goal setting for the company.