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Jasmine: [00:00:00] welcome to Make Good Fashion, the podcast that's all about starting, launching, and growing impactful fashion brands. I'm your host, Jasmine Rennie. /

/Hello, my beautiful friends. Welcome back to another episode of the make good fashion podcast. So today I want to hop right into it. Cause I want to address a question that I frequently get asked or I frequently hear. People who are looking to start a fashion brand ask, and that question is how much money do I need to have to start a brand?

And I've heard people answer this question with an actual number.

And I feel like you can't really do that. Like I've heard someone say before, like you need at least $40,000 to start a brand. I don't think that's true. I didn't start off with $40,000. I know a lot of people who didn't start with for $40,000. People who bootstrapped with very minimum funds and it's completely possible to start small and grow.

So I [00:01:00] want to de-mystify that and address that first, because I don't want you to feel like. You know, you have to have tons and tons of money to start, and that you cannot pursue your dream if you are not, you know, if you don't have. A lot of money to start off with. So let's start with addressing that first. So. There are a lot of things to consider. When starting a fashion brand that you need funding for. So much so that a lot of things get missed. You know, we have the cost of manufacturing, your product, which is probably going to be your most, one of the most. Costly things. So, you know, for producing your collection for the sewing, for the cutting, for sourcing materials, Especially, if you were starting a brand and you're starting as a business and not just creating products and you plan to sell it.

You are going to have to buy a lot of things in bulk.

So for example, with fabrics and things like that, There are minimum order quantities. [00:02:00] So. But say minimum order quantity for a fabric fabric. You like as a whole role. And there are a hundred yards in a rural, you might not be using them all at once. But you do have to pay for the whole thing at once.

And so not some things that you're going to have to consider. Then there's things like your marketing budget and sometimes as it goes overlooked, because so people are so focused on putting all of their budget into the product, but I really believe that it's very important to set aside a budget for marketing. Yes, there are organic marketing methods like social media and all of that.

But when you are doing your marketing strategy, it's important to note that. If you're going to do it organically, you might grow a little slower. If you put some money to it.

You know, whether that be with paid ads or through influencer marketing partners with influencers. Or gifting, whatever you may be doing, it's going to accelerate you a lot more. So. It's important to set aside. Budget for marketing. Then you have to think about all the [00:03:00] sampling that goes into play. You know, sampling. Each piece, each designed to make sure that it fits right.

And a lot of times, if it's not great at the first go around, you have to make another sample. And so that's something that you have to consider too. There is a branding website development. All the things. And so there's so many things that you want to consider. And let me just plug this really quick, because we actually created a budget template on the make good fashion.com shop. And we already went through and prefilled it with all the things that you are going to need to consider to start building your brand into. Amazing resource.

And I'm not just talking about it because it's something that we sell, but it's something that is super useful and everything we create really is to help you guys to elevate your businesses, to start the businesses that you're dreaming up and to simplify the process so that you don't have to go through the hard things that I went through and that you can save money on making costly mistakes.

And so the budget that we [00:04:00] created basically has. These categories that I'm talking about, itemize my, so sampling your manufacturing costs, your marketing budget, your, your branding, all those categories. So you can start plugging in numbers into that and create a budget. That's actually realistic and you're not just the rang a number out in the air. But, you know, when we talk about budget and creating a budget, because creating a budget, is the best way of figuring out exactly how much it's going to cost you a budget.

You can create it more specific to your product instead of getting a random number that's floating around the internet. So when you're creating your budget, basically what you will have to do. And I know sometimes it can be a little tricky when you haven't even started your brand. You don't know the cost of things and all of that, but when you have a budget and let's say you're using like our budget template that has all the categories already listed, you can kind of see each item that you're going to need for , to launch your brand. The easiest way to go about this is to start researching first, thinking about thinking about the things that you're gonna produce and how many items you're going to produce.

Obviously, if you [00:05:00] start with less items, you're going to need less money. So. If you are someone that doesn't have a big, a huge budget or you're starting small. And I'm going to talk about funding too in a second. So if you are someone who wants to start a little bigger, but just needs funding, we're going to get into that.

But yeah, the smaller, your start obviously the less money. You're going to need the bigger you want to go. The more money you you're going to need to start off. I always recommend starting small. Here's why, you know, we can have an idea and do all the research, have an idea of who our ideal customer is. What their needs are and have proof of concept we've, you know, done the surveys, asked people. Their thoughts and opinions about what we're creating.

And everyone's like, this is the best thing I've ever seen. Like since slice bread, you have an amazing concept and you can feel totally confident in that. But the truth is you won't really know until you take this product to market what the reception's going to be. And so I [00:06:00] always liked the idea of starting off smaller because. You can start off with less pieces. Take it to market start selling those pieces.

Right. And you can then get more customer feedback and see how the reception is to that product. And then from there, you can reiterate your design. You can say, you know what? It seems like customers are liking more of this than this style. And then you can double down on that style.

That's doing really well. So that's why I always recommend on. An ongoing small. Do fewer pieces. Get feedback, test out how that's working and then go ahead, reiterate, refine, and then come out with a larger product line. Once you feel more confident. The reason I say this is because a lot of times, again, like we can have all the proof of concept in the world.

We are sold that this product is going to sell out. But you'd be surprised what customers end up gravitating to. I think a lot of times. I am so thrown off guard because I am like, oh yeah. [00:07:00] This is going to do amazing. And then you see people like going crazy over certain products. There's this jumpsuit that I created years ago in my brand.

And, one, I did the design for the jumpsuit. Of course, I was like, I love this jumpsuit, so cute, but I had no idea that for. Six consecutive years that this jumpsuit would be a best seller. Had no idea. Like I said, I knew it was a great design.

But nothing could prepare me for how many times this jumpsuit would sell out.

And so from the first time we sold it and I saw how customers, how receptive customers were from it. Then I was able to go from there and say, okay, this product is doing better than all these other products. I can eliminate some of these products that are not selling as fast and then double down on the jumpsuit , do it in like three different colors, increase the quantities and all of that.

And so all that to say, starting small is just fine. So don't worry about that. And don't feel like you have to have this huge budget to start really big.

so once you have that idea of how many pieces you're going to [00:08:00] start off with, then you want to consider how much it's going to cost to manufacture those products.

Right. And so this is where you're going to have to start doing research. If you have not manufactured eight collection before, so you're going to want it give a phone call to maybe some factories, show them at least some designs that you have, or some examples of other products that. Are similar to the product that you're looking to create and get an idea of how much it would cost to make something like this. And then you would start adding those numbers, those estimates into your budget. So that you can start documenting the cost of these things.

And you can do the same thing, not only for your products, but also for your website and for your branding. Get an idea of how much these things cost, add it to your budget. So you can start calculating how much you're going to actually need.

When you are thinking about your budget and thinking about how much you need for your line, you're always going to need more than you actually think.

There are things that will happen. During the manufacturing process or minimum [00:09:00] order, the MOQ minimum order quantities are a lot larger than you think.

cost can change. So sometimes when you get a quote for something. At one time, a couple months later, it can get more expensive. And then there's always some kind of hidden costs with things, you know, like things that you just, that, that just come out of nowhere. And so always add a little cushion, add a little room for the unexpected and. Again, with the make good fashion budget that we have, we add automatically add in our formulas. A little extra. So that you can prepare. It's a little cushion that we add percentage so that you can have an idea of how much you actually should be fundraising or how much you actually need to be saving to account for those, you know, surprise costs that may come up.

So I will just give you a little insight because again, everybody's always wanting some number.

And like I said, I don't think there is a concrete number, but I will tell you the, I started off, I fundraise about 6,000 and something [00:10:00] dollars. So I started off with maybe 6,500 somewhere in the 6,000. Which is not that much. And. Once you, you know, start building your brand, you will see that. This is a business that. You can burn through money really quickly. And so anyways, I started off with $6,000, 6,500, whatever. And with that, I started off with three pieces, but also I use that money to build my brand house.

Right. So I did a lot of like the website development on my own and the branding on my own, but I did have to pay for. You know, the subscription to Shopify to start my website. And there was other things that, you know, go into building a brand that you need to buy office equipment, all of that stuff.

So with that $6,000, I was able to do all of that produce three products. I think I started maybe with only. Maybe only 30 styles, 30 pieces, right? 30 pieces, three styles. And inventory, and this is a very modest about, but [00:11:00] this is something that I felt comfortable with. Like I said, I wanted to start small because I didn't know what was going to work.

And thank God I did because. At the time, I did not understand the manufacturing process that well, and there were things that went wrong. Like the pieces didn't fit that. Great. And there was a lot of things that I couldn't even sell because. The fit was just off. And so. I am so glad that I did not go ahead and produce like a thousand pieces right off of the bat and spend all that money.

Because again, there were things that needed to be refined to make the product better. And so that $6,000 kind of last me through there. And then I was able to sell through some of that product. And then. Obviously make more money and then just continue to funnel the money back into the business. And so that worked for me. Would I have wanted more money? Yes. It would have been a lot easier to grow faster because I didn't really have that marketing budget to do all of that. I was sending free products, so I found free ways to market, [00:12:00] but like I said, marketing organically is going to take a little bit longer than having some money to market with. And so I would say at least try to go for a $10,000.

But you can start, like I started because I was able to take that $6,000 and then flip it into six figures. And so it's completely possible. Again, you just might grow a little slower, so don't get discouraged The more money you have, the more flexibility you do have though.

So, once you have vetted your brand idea and you feel super confident and you know, the brand idea that you have, and, you know, you are committed to really making this brand work. Like shoot for the stars. So let's talk about that though. Let's talk about Some ways that you can find funding to, to launch your brand and to start with, you know, some cash to play around with. So, obviously they're self-funding and that's just bootstrapping with your own. Money.

And so, saving up to start and all of that, I believe I had a little bit of savings too, that I use, [00:13:00] but not that much. But yeah, saving is always great. You don't have to pay anybody back. And so it's always great when you can bootstrap. There's also crowdfunding. So this is actually how I fundraise.

I used a crowdfunding site called indie Gogo. Dot com and for those of you that don't know what crowdfunding is, crowdfunding is basically you are. Getting funding from the crowd. So you are basically allowing the public to invest in your company, but instead of getting equity in your company, They'll either get product. Or they will get their money back.

However, the crowd funding site works so Indiegogo and Kickstarter to big crowdfunding websites, how they work is that. Once somebody gives money to your business, they will do so in exchange for product or incentives. Right? So you can have different tiers that you allow them to give. So, for example, you can have a $5 tier. A hundred dollars here and a thousand dollars here.

So for the $5 tier. Maybe you'll give them like a [00:14:00] special, no to where tote bag something very cheap that is lower in cost than the investment amount that they're giving you. And then the hundred dollar one, maybe you'll give them a. A t-shirt in exchange for their investment from your brand, right?

So it's a product exchange. Then for the thousands, since they're investing a little more, maybe you'll give them a cut and sew product or a, you know, two pieces of their choosing. But again, just make sure that it's lower than the amount that they're investing, because you want to make sure that you have money after you produce the product that you're going to give them. And so these crowdfunding campaign sites do take a small percentage, but you have the ability to raise a lot of money. To start your brand.

And I love them so much. Like I said, I use indie Gogo and you do have to create a page where you're pitching your product. Just like any other investing type of thing. So that takes a little bit of work and it can take some money if you're like filming it professionally and all of that. But you want to [00:15:00] make sure that you tell a compelling story in a compelling pitch so that you are able to get some funds.

And so I, again, I love this method because you're not putting out a lot of money to get started and you have the ability to make a law. A lot of people have raised a lot of money. On crowdfunding campaign. So this is something that you definitely want to look into. There's also small business loans and small business loans are great.

If you can find them with low interest, cause you don't want to be. You know, paying so much back in interest, but there's some great sites like the SBA and other sites like that. That can that you can get approved for a small business loan. And then there's friends and family, so, you know, Getting friends and family to invest in your idea.

And then obviously investors as well. But again, my number one. Thing that I always recommend to all designers is to do crowdfunding, especially if you have no money to start off with, this is a great way to [00:16:00] go.

So another way that you can get funding for your fashion business. And this is more so for people who've already started because it's kind of, it can tend to be harder for people who don't really have an existing footprint or, you haven't really done anything with your brand yet. Is a grant opportunities.

Now this is another thing that I love and I have been the recipient of a grant before, which was amazing. I got $25,000 in grant money. The great thing about grants is that you don't have to pay them back. So is free money. And there are grants all over the place that you can apply to small business grants. Brand specifically for fashion. Grants that help out minorities grants for women own businesses.

There's one that I love called Amber Grant, and they do a grant every month of $10,000. And I think at the end of the year, they do a $20,000 grant. So there you're specifically for women owned businesses. But the applications process is very smooth. I think there might be a $5 fee, which is very. Small, but it's just a great [00:17:00] opportunity to get free money for your business.

So again, I think this works better for people who have already started, even if you're brand new. Cause they will ask you questions about your business and if you haven't started and you don't have, you know, any proof of concept, then it's harder to get that grant money. So I want to circle back. About the cost of starting and. Again, when you're thinking about how much you're going to start off with and how much you need, how much funding you need. You also want to think about a goal in your mind of how much you actually want to make in your business.

And I always recommend starting very realistically, so frequently I'll hear people say, I want to make a million dollars in my business. I think that's like the, the goal for everyone. Everyone wants to be a millionaire, right? But. Is it realistic to shoot for a million dollars? Your first season with a limited budget, maybe not.

So you want a great bite size goals. So you want to create goals and go from step to step to step. So instead of shooting for a million. [00:18:00] What if you shoot for a hundred thousand first year or 50,000, the first year, the next year, you go up to 200,000, whatever it may be. Make it a stepping stool because you don't want to discourage yourself from trying so hard to hit so high. When again, you have no proof of like what's doing well or what direction you need to start in or whatever it may be. Start modestly your first year re iterate, then set a new goal and go from step to step to step.

Don't put too much pressure on yourself, but once you have that goal of how much sales that you want to make in your first season or your next season, whatever it may be. Then you can go from the goal and break that down. Okay. If I want to make a hundred thousand dollars this year, How much. Average do I need to make a month?

So dividing that by 12, right? And then going from there, how much product do I need to make? To hit that number a month.

Right? So that's a great way to think about it. So you can understand roughly how many pieces you're going to need to [00:19:00] make in the year. And then you can break that down and say, okay, I need to make this many pieces. So in order to make this many pieces, and once you start researching on the costs on how much it costs to make these things and using the budget. You know, figuring out how much it's going to be. Then you can go from there and then think about, okay, I need this much in funding. If I'm going to hit that goal that I have in mind. So you want to start backwards, break it down, and then that's how you can find out how much you need to fund your brand. But again, It's completely possible you just have to set those realistic goals and know that you may need to start smaller. So here's some tips for those of you guys who are seeking funding to start your brand. So one is to prepare a solid business plan, especially if you are going to go the route with the banks or investors or that kind of thing, you want to have a business plan.

I mean, any route you're going really, you want to have a business plan because you want to make sure you have a plan of action. Those who fail to [00:20:00] plan, plan to fail and having a concrete, blueprint set out of what you plan to do in your business is really helpful. Have those financial projections and those goals that we want to set all laid out. There is a site called live plan.com I believe.

And they have great business planning templates on there and you can just go in, I think it's a monthly subscription. You can cancel at any time. But it's great guidance for those of you who don't really know how to put a business plan together and they have template specific to industry too.

So I would check out life plan. I'm going to include the link to the life plan, actually in the show notes. If you're interested in that. You also want to start thinking about a compelling pitch and story. So like I said, if you're talking to investors or just sharing on your crowdfunding site, About your product.

You want to make sure that you have a story that is going to really capture people and that you are actually creating a brand that solves a problem, and that you're able to articulate that so people can [00:21:00] see the need for your brand and that they will want to invest in it. And you also want to start building relationships and networking. I think it's so important to build relationships and network, because one, you can start finding out how other people funded and find other opportunities, whether it be grant opportunities or. Financial support.

Or they can connect you with investors or whatever it may be.

And also when you are connecting with other people who are in the fashion industry, they may have resources on where you can find manufacturing for a lower cost or find fabric suppliers that are within your budget. So that you are not so limited in what you know. And so I always recommend networking.

I know it's so cliche, but just getting around people. I'm introverted and I do it. So if I do it, you can do it. There are so many industry events you can go on like meetup sites or just follow. Different industry Instagram accounts follow, make good fashion on Instagram. I'm [00:22:00] constantly posting opportunities.

And so there is no excuse, you shouldn't know of things going on. If you're falling, make good fashion. Because I am always posting stuff, so yes. Make sure to make those key relationships and network. So yes, you guys, I hope this was helpful. I hope that you're feeling more confident in that, you know, if there's a will, there is a way, if you have a passion to really do this and you know, that you can make impact through the things that you create. There is a way to do so. There is a way to find funding.

And even if you have to start small, You can do this. So a couple of resources for you. One again. I highly recommend getting our. Make good fashion budget. I'm telling you. It's going to simplify this process of creating a budget so much, because most budgets are very generalized, but this is specific to the fashion industry and the things that you're going to need.

And then our free resource for you would be our fashion startup checklist. And [00:23:00] this checklist basically just goes down all the steps of creating your brand. And it leaves out this like clear blueprint of like all the steps. You can start getting your gears going of the things that you need to consider , when it comes to. What you will need financing for. So if you go to make good fashion.com/fashion startup. You can get that checklist. And then for the budget, the link is make good fashion.com/shop all of the links and everything that I've talked about in this episode, you can find down in the show notes too. So make sure to check in there. Thank you guys so much for joining me on this episode.

I hope you learned so much and got so much value out of it. I will see you next time. Friend.