Content

• Steps

If you are passionate about fashion and want to become a store owner, then opening a clothing store will be a wise decision. However, this is not a simple task. Starting a business requires thoughtful thinking and planning. Start with identifying your store's target audience and segment. Then find the perfect location to open the store. Calculate all estimated costs and apply for a startup loan if needed. Marketing your business online to increase sales. Finally, hold a grand opening to get your own new store up and running.

Steps

Part 1 of 4: Market research

1. 

   Identify your target audience. Your target audience decides almost everything about your store, from what you're planning to sell to the location of the front of the store. Start by thinking through who your target audience is. Next, use that decision as the basis for other decisions about your store.
   • First, think broad. Do you want to attract men or women? Then let's focus on more specific details. Think about the age group, industry, and fashion sense you want to target.
   • To get started, use what you know. If you've ever worked in a clothing store selling business suits, you probably already know that market well. Consider trying out an area in which you have such a lot of experience.
   • Think where you can make the most money. In a small town, people won't have much need to invest in business suits. However, you can welcome a large number of tourists in the summer. In this case, it would be better to open a fashion store targeting tourists.

2. 

   
   
   Explore potential locations for your store. Positioning is one of the most important initial decisions you'll have to make when starting a business, so do your market research thoroughly. Look for a location with good customer traffic to welcome your first customers. Look for other businesses that do the same business. Small businesses are often located adjacent to each other to attract as many customers as possible, so this might be the place for you.
   • Don't position your store too close to identical fashion stores. If there are too many other small clothing stores in the location you're exploring, then the market is probably too saturated. Consider looking for another location.
   • For example, if you intend to target a tourist audience, look for the store for a location close to the tourist center locations.
   • For a good traffic flow, open a store near restaurants and cafes. Places that people visit often will bring your store a lot of shopaholics.
   • Find out the cost of renting a space for each site you explore. These costs are often very large, so don't ignore this point in the planning step.

3. 

   
   
   Find a special product for in-store display. Large department stores often offer all the famous brands at affordable prices, so your store will hardly stand out if you try to stick with that model. Think about the features that set your store apart from larger competitors and other small businesses. The layout sells brands or products that major department stores do not have, or develops a specialty in the fashion sector that your area lacks.
   • The positive aspect is a sale of the brands supplied by the local factory itself. This will bring a different breeze to your store that buyers can hardly feel at large retail.
   • Your town may have a lot of shops that sell rustic, but there is a shortage of shops that sell gourds. This will be the place where you can open stores for this niche.

4. 

   
   
   Make a backup plan if your business is not going well. Always keep in mind that starting any business is risky, and lots of small businesses fail. Do not let this discourage your will, but also make a backup plan in case the business does not go as expected.
   • Save enough emergency funds to cover 6 months of living expenses if you have to find a new job.
   • Remember that clothing stores typically have less net profit margins compared to other businesses. You started this business because you have a passion for fashion and want to work with people. This passion will help you think positively if profits are below average.
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Part 2 of 4: Loan and business combination

1. 

   Determine your total operating costs. Find out the cost of opening a store before you get started. If you do not fully grasp the financial picture, it will be difficult for the store to run smoothly. Operating costs, also known as fixed costs, are the costs you pay on a regular basis to keep your store running. Calculate all fixed costs per month and accrued expenses. The resulting sum is your operating costs.
   • Common operating costs are space rent, utilities, insurance and phone / internet connection. If you take out a loan, the loan repayment is also a fixed cost.
   • The general advice is to try to keep your space rent only about 6% of annual sales. Keep this in mind as you work out your costs. If the rent is 20 million dong per month, that means it will cost you 240 million dong per year. That means your revenue must be around 4 billion VND to meet this recommendation. If you cannot plan a sale of this scale, consider finding a cheaper rental space.

2. 

   Calculate inventory cost and labor cost. These are called variable costs, because they can change from month to month. For example, you can buy less inventory or hire fewer employees while your store is open. Calculate all inventory costs and expenses you pay to employees. Then combine this with any other available variable costs.
   • Some of the other variable costs include advertising and marketing costs, because it is not necessary to do these jobs correctly to open a fashion store.
   • Calculate your fixed and variable costs to find your break-even price, which means that your monthly earnings should be enough to cover your expenses.

3. 

   Outline one business plan. A business plan is very important, it not only helps you focus on your thoughts, but also because any potential investor wants to see your business plan before providing capital. An overview of your business, including the items you will sell, your activity plan and all costs. Always present your plan to anyone you want to raise money for.
   • Start with an accurate description of your business. What will you sell and who are your target customers?
   • Then outline how to adapt to the current market. Explain the research you've just conducted and how your business differentiated from your competitors.
   • Finally, show the total costs, including both fixed and variable. Then, note how much capital you need to start a business.

4. 

   Establish a legal business entity. While establishing a business entity is not strictly required, there are many advantages to doing it. Establishing an entity separates your personal finances from your business finance, which in turn helps preserve your personal savings. Traders, producers and lenders often prefer to cooperate with a business rather than an individual. And lastly, you can report business expenses and get tax deduction as a business owner.
   • Some of the most common entities are a Limited Liability Company (LLC) and a business corporation. Most small businesses will be called limited liability companies because small businesses often have few employees.
   • Obtain a business license where you operate. If you don't want to handle the paperwork yourself, you can hire a lawyer or another business to help you with this job.

5. 

   Apply for a small business loan or seek a private investor. If your savings are not enough to open a store, then you should seek financing from banks or private investors. Apply for a small business loan at a local bank. If the bank does not provide enough capital, private investor will be a better choice. Remember that compared to banks, private investors often expect a higher return on their investment costs. They will want to own part of the business instead of getting back the loan.
   • The amount of the loan depends on your total cost. Experts recommend that you have enough capital available for about 6-12 months when starting a business, because it will take a few months to start reaping profits.
   • The common amount of capital to open a small clothing store ranges from as low as VND 1 billion to over VND 4 billion, or even more for large stores.
   • Having more business capital available is better than not having enough capital. Most small businesses fail in the first year because they don't have enough capital.
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Part 3 of 4: Prepare goods and hire staff for the store

1. 

   Contact suppliers for product pricing. Once your financial and business plan is in place, start stocking up for the store. Search for suppliers or manufacturers in the market segment your store is located. Find the best items at the softest prices and order for the original quantity of goods.
   • Consider buying goods in bulk to save money. However, the quantity ordered should not be more than what you believe is sellable. If you invest all your start-up capital into buying goods right away, it can be difficult to pay your other bills.
   • Try to contact manufacturers directly, instead of wholesalers. You can save money by buying directly from the manufacturer.
   • The trade show is also a great place to find cheap wholesale items.

2. 

   Personalize the store from the local factory products. Small stores are often part of the community, and a good way to blend in with the local community is to display local goods. Contact jewelry artists and clothing manufacturers to display their products in your store. This gives you a great stock supply and is also a great way to promote the store.
   • If your store doesn't have enough space to display local items on a regular basis, consider holding a showcase event for local manufacturers each month. For example, you could design a display tent in your parking lot and allow manufacturers to attend events and display their products.

3. 

   Hire staff if needed. The number of employees you need will depend on the size of the store. The general advice is to hire 1 full-time and 1 part-time employee per 93 sqm of the store. Think about how much work you can do yourself. Then hire more staff if you need it.
   • You should have at least one reliable employee who can help manage the store in your absence. You never know when you'll have an emergency or when you'll get sick, so someone who knows store management like you should be.
   • Remember that each employee you hire will be another extra cost. Hire only those you need.
   • If your business does not run regularly, consider hiring seasonal staff to save money. If you run a travel fashion store and only run in the summer, then it is not necessary to hire many employees in the winter.
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Part 4 of 4: Business promotion

1. 

   Opening event organization. After all the effort and effort to build, this is the time to create an impressive buzz by organizing a grand opening event. Invite people you know and promote the grand opening around your area. This is a great opportunity to let people know about the store's presence and spread the word.
   • Offer a special discount on opening day to give people samples of the products you're selling.
   • Contact local media sources so they can attend the event. This will help you advertise your store for free.
   • Invite your head of residence or other local politicians to draw more attention for this grand opening event.

2. 

   Use media to place advertisements. The media offers you a great way and the right price to promote your product. First, start creating your store's page on all the key social media pages. Then start advertising campaigns on these sites to let the locals know about your store.
   • Because your store is located in the physical location, spread your ads to target customers 8-15 kilometers from your store. Promoting to people about 160 km away will only waste the advertising costs.
   • Regularly update all of your social media sites. If you don't post anything on Facebook for about 6 months, people will assume your store is closed. Aim to post at least 1 post a week on each of your accounts. Also, don't forget to post any important announcements, like deals, across all of your accounts and website.
   • Remember there is still a charge for advertising. Include these advertising costs in your budget as well to avoid going over costs.

3. 

   Attend local fairs and festivals. Almost every community has major events like this showcasing local business products. Try to attend as many events as possible to promote your business. Sell ​​your samples and items at the event so people can see what you have to offer.
   • Always carry lots of business cards with you when attending these events. Exchange business cards with as many people as possible.
   • Check with your local chamber of commerce for a listing of upcoming business events. Attend as many events as possible.
   • Don't neglect or close the shop when you attend these events. Have the best and most reliable staff manage the store in your absence.

4. 

   Selling online to reach more target customers. Websites like Amazon and eBay often provide great platforms for small businesses. If you only focus on direct selling, then you will miss out on the huge potential of reaching more customers. Create a sales account on one or more online retail sites and list your items. This is considered a great way to attract more customers or increase profits if your direct visit to your store is slow.
   • Track sales online. If you are complained about poor service, you may be banned from these sites.
   • Include links to your online store on all your social media sites.
   • Remember that all online stores have to pay an associated fee. Find out all the fees you'll be charged and price your items appropriately so you won't lose meaningless money.
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