Guide to Retail Clothing Store Business Startup

Opening an apparel store is serious business. For some of you, it may mean giving up the safety of your corporate job with its steady income, paid holidays, vacations and the opportunity for advancement. All this, and guaranteed 12- to 14-hour days. Running an apparel store is more than a full-time job.

Fortunately, there’s always room for the right kind of apparel store. Although you might not guess it by the number of malls and outlet centers cropping up, we’re mostly a nation of small, independent merchants. In fact, most retail stores, and that includes apparel stores, are small, both in size and in sales volume.

The industry is very competitive — 80% of retail clothing businesses fail within the first five years. This is often due to poor management, tough competition from department and discount stores, and poor evaluation of fashion trends.

Ask yourself first:

  1. Is this a business in which you have experience?
  2. Can you live with the inherent risk in the apparel business?
  3. Do you believe strongly in the apparel industry?
  4. Is your niche overcrowded or dominated by a few?
  5. Can you become a specialist?
  6. Do you have a competitive advantage?

Planning to Opening

  • 1. Develop your idea by writing a business plan, which details the store concept, strategy, competition, financial outlook and marketing ideas. Outline your concept down to the tiniest detail. What will you focus on — menswear, women’s clothing, prom and formal event clothing, accessories, children’s clothing, hand-made clothing, modest clothing, hip-hop clothing? Scour the internet for estimates of market size and share. Look around your community to see who else may be running a store similar to the one you want to open.
  • 2. Search for a great location for your store as it will receive a lot of walk-by and drive-by traffic. Realtors can provide you with estimates on traffic patterns near your store location. Be sure to check convenience factors, too, such as handicap access and parking. Many business fail because parking is a nightmare for their customers. If the store was already a clothing store, make careful inquiries about the previous tenants. Did the business move, close, or go bankrupt? If they went out of business, why?
  • 3. Purchase retail fittings for the store. These may include special lighting to highlight your products, display cases, clothing racks, counters, cash registers, telephones, credit card terminals, carpet, dressing rooms, shopping bags and gift wrap. Look for retail-fittings companies online or for local auctions. Many stores that are going out of business sell their fittings very inexpensively, and you can often paint racks into interesting colors to jazz up your store.
  • 4. Decorate your store with your customer in mind. If you’re catering to trendy teens, your decor will be different than someone targeting affluent, middle-aged customers looking for executive attire. Choose carpet and paint colors accordingly.
  • 5. Prepare for your opening day by creating a simple, effective Website. Consider eBay stores and a shopping Website in addition to your physical location to supplement sales. Promote your new business by issuing a press release to local media, ads in newspapers and fliers. Advertising is the key for any new businesses, so plan to invest in local advertising to drive traffic to your store.
  • 6. Most small-business owners do the majority of the work themselves instead of hiring help. Hiring staff increases costs dramatically, both in salary and taxes. If you need to hire someone, look for part-time help well in advance of your opening day. Make sure that you provide them with adequate training on how to run the cash register, store policies and regulations, and information on the merchandise.

To succeed in the retail clothing industry, you must enjoy meeting people, have selling and fashion savvy, adapt well to change and work long hours. Before starting your own store, gain experience and expertise in the industry and take related training and courses.


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