How To Sell Your Fashion Products Without Feeding Everyone Else But You?
In our article “How do you know your price is right for the customer?” we provided you a simple but very powerful method on how to understand the right pricing for you to sell your product to the final customer.
You guessed it…
That price for your final customer is independent of the way your designer pieces get from your studio into the hands of the fashionistas wearing them.
Now, this article is about how you can make the money you need to pay your bills and grow your business while even further improving your customer’s experience.
First, take the business into your hands
When you master the whole customer experience, you will be rewarded for your great work.
Let’s now explore your options.
What is the conventional model?
You design and produce – Retail sells.
This is still the most common model having its benefits and drawbacks. Looking at it from the side of a young fashion designer, the disadvantages probably dominate.
Given the power position of the retail business, it is not only challenging for you to be recognized and accepted by the fashion retailers but they also often dictate what you get.
The cost of running physical stores and all the related overhead cost lead to markups of 2,5 and sometimes up to 4 of what they pay you. The way your product is presented to the customers and the transactional part of the process is taken over by the retailer, who then pays you between 20% and 40% of the retail price.
You not only run a real risk of not even covering your cost with what is left for you, but you are also entirely at the mercy of the retailer, who in the first place might even reject your products entirely.
The average amount of total store budgets allocated for new, small or unknown collections is less than three percent. The pie is small, and for the new guy, it’s the crumbs.”Geoffrey B. Small.
In the end, you also have no control over pricing and demand, promotion and presentation of your product you have spent so many hours and passion on. All the power is in the hands of the retail business, and they love it that way.
But… Is it worth it?
We feel this business model is to be revisited, and here is how we will do it.
You design – produce – sell
If you consider now selling the same fashion design product on a marketplace, an online and open marketplace, where you:
- Open your own store
- Present your pieces the way you feel is right
- Set prices according to your pricing strategy
- Interact directly with your final customers
- Master the customer experience from A to Z: design, materials, presentation, communication, transaction, packaging, and shipping of your fashion products
How fashion lovers feel going out the first time wearing your beautiful and unique fashion design pieces and what they will tell their friends about you, your talent, your work, and your service are entirely in your hands.
Second, select the right sales channel for you
An online marketplace is a “hybrid” sales channel as it is direct and indirect selling at the same time.
For a new fashion designer, it’s possible, realistic and in reach to design, produce and sell directly, cutting out all the middlemen in the conventional retail business. On an online marketplace, the store is yours. It’s only the platform hosting your shop that is not yours.
What are the benefits of an online fashion marketplace compared to fashion retailers?
- There is no selection process. In an open online marketplace, every fashion designer can sell their fashion products, whatever their style or background is. It’s up to the customer to decide if your fashion products are valuable, not to the retailer.
- The fashion designers own the whole process: price, presentation, customer database, service, etc. It’s up to the designers to own the entire value chain and make their own business grow, not to the retailer.
The fashion industry can work with middlemen and retailers. This has been working well like that for decades.
But it doesn’t work for fashion startups because you end up feeding everyone else but you from your fashion designs. This is not sustainable for any business, and this is not worth it.
As an aspiring fashion designer and a brand new fashion label, you have to clean out the whole distribution chain to minimize your cost and maximize your margin.
Selling directly to your customers with a small commission to an online marketplace is your best option to achieve that goal. And as soon as your customer base is big enough and your label is known, which is all the best we wish you, selling directly through your own online store will become your best option.
According to McKinsey‘s data, nearly half of luxury goods buying decisions are already influenced by what consumers hear or see online. And this trend will just continue to grow in the next years.
If you have started already to sell your fashion designs, please tell us about your experience.
And if you are just about to start, please let us know about your plan.
This article is about the 6th step of our essential guide for aspiring fashion designers called: 10 Steps To Success – How to start and grow your fashion business. If you would like to know the 10 steps to make it in the fashion business, you can download that guide for free here.
(Photos from Unsplash: Brunel Johnson, Yuriy Trubitsyn, Stuart Guest-Smith).
P.S. FashionTalents is an open marketplace where you create your fashion business in minutes.
Or contact us to get a demo.
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Fanny is the CEO + Co-founder of Fashion Talents, and a passionate and tireless promoter of new fashion designers. She’s on a mission to open fashion business to all talents around the world and drive shoppers, sales, and success to them.