Table of Content

    Fashion Industry business plan for starting your own agency

    One of the best ways to live your dream life is to have a business of your own, a setup where you are the boss, and you can make all the money that you need to fulfill all your dreams. If you want to start your business today, this business plan for fashion can help you achieve your dreams. We will tell you in detail how to write a fashion business plan. In this detailed business plan template for fashion industry, we will cover everything involved in starting the business from start tom finish. This can be used as a guide to start the business or as a investment group business plan.

    Executive Summary

    2.1 The Business

    Apple Fashion will be a fashion industry located in Paris, France. This business plan for fashion industry will walk you through all the steps needed to start the business and run it in a profitable manner. We are writing a fashion business plan based on this example so that you can easily start your own business.

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    2.2 Management of Fashion Industry

    The first thing you need to have for starting a fashion business plan is a well-defined management structure for the business. Without that, you cannot effectively start and profitably run the business. Go to any of the top business plan companies and the first thing they’ll discuss will be the management structure of the business you want to start.

    Just like we did in the clothing retail business plan, the business will be headed by the owner and they will hire managers to run various aspects of the business. They key to the success of this business is appointing the right person on the right position.

    2.3 Customers of Fashion Industry

    Like any other business, it is important to decide the customers that you will be dealing as a part of the business. If you do not have a clear idea of the customers, you will be dealing, the business can never be profitable. The customers of the fashion industry will be the following:

    • People who want custom-made designer clothing and accessories.
    • Movie crews who need costumes for a movie.
    • Retail stores who want to market premium clothing and accessories.
    • People looking for wedding and party dresses.

    2.4 Business Target

    The target of the business is to make designer clothes available and affordable for everyone. With this business, we hope to decrease the prices of premium clothing. Other than that, making profit is also a target of this business.

    Moreover, we also want to expand to other cities and start a franchise business model for expanding the reach of our products. The ultimate goal is global domination and competing with the likes of Louis Vuitton, Gucci, and Parada.

    Fashion Industry Business Plan Template - 3 Years Profit Forecast

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    Company Summary

    3.1 Company Owner

    Sarah Carnegie is the person who will be the owner of the business. She is a veteran fashion designer from America holding many awards and accolades. She also happens to be quite rich and generating the funds for the business will not be an issue for her. All that makes Sarah the best candidate for this business plan fashion industry.

    3.2 Why the Fashion Industry is being started?

    The next thing that we need to talk about is why the fashion startup business plan is being started. There are a number of reasons for that. First and foremost, Sarah always wanted to start a luxury clothing and accessories line of herself and now is the time for her to do it. Secondly, Sarah has recently been fired from her job and she no longer wants to be the employee, she wants to be the boss. With the hundreds of millions of dollars burning a hole in her account, she can do whatever she wants.

    3.3 How the Fashion Industry will be started?

    Note

    One of the most important things to discuss in any start up fashion business plan is how the business will be started. Thankfully, this fashion business plan template free includes that too.

    Step1: Market Need Analysis

    The first thing needed to be done before starting the business is market need analysis. This will tell us whether or not there is a need for the services we are going to provide. Just like a lingerie boutique business plan, the business cannot be successful without it.

    Step2: Developing a Brand

    This is the single most important part in this whole business. Luxury goods are only as good as the brand name printed on them. We need to establish Apple Fashion as a brand that people can trust if we want to see any measure of success in the business.

    Step3: Opening an Outlet   

    The first outlet of the business will be opened right in the front of Eiffel Tower in Paris. That must be expensive but remember the hundreds of millions of dollars burning a hole in Ms. Carnegie’s account? She’ll use them.

    Step4: Establishing an Online Presence  

    Having an online presence is perhaps even more important than having an outlet in front of the Eiffel Tower. Thankfully though, it is not as expensive as that. So Sarah will hire a web designer to make a website for her brand to make the brand known to the public.

    Step5: Promotion and Marketing

    Next up, collaboration will be done with prominent celebrities to endorse and promote the products from Sarah’s brand. This is also very important because people follow these people and we can use that as leverage to create sales.

    Fashion Industry Business Plan Template - Startup Cost

    Start-up Expenses
    Legal $254,000
    Consultants $0
    Insurance $35,000
    Rent $30,000
    Research and Development $28,000
    Expensed Equipment $54,000
    Signs $4,100
    TOTAL START-UP EXPENSES $405,100
    Start-up Assets $342,000
    Cash Required $357,000
    Start-up Inventory $39,000
    Other Current Assets $234,000
    Long-term Assets $276,000
    TOTAL ASSETS $1,248,000
    Total Requirements $1,653,100
    START-UP FUNDING
    Start-up Expenses to Fund $405,100
    Start-up Assets to Fund $1,248,000
    TOTAL FUNDING REQUIRED $1,653,100
    Assets
    Non-cash Assets from Start-up $1,629,000
    Cash Requirements from Start-up $386,000
    Additional Cash Raised $53,000
    Cash Balance on Starting Date $39,000
    TOTAL ASSETS $2,107,000
    Liabilities and Capital
    Liabilities $30,000
    Current Borrowing $0
    Long-term Liabilities $0
    Accounts Payable (Outstanding Bills) $48,000
    Other Current Liabilities (interest-free) $0
    TOTAL LIABILITIES $78,000
    Capital
    Planned Investment $1,653,100
    Investor 1 $0
    Investor 2 $0
    Other $0
    Additional Investment Requirement $0
    TOTAL PLANNED INVESTMENT $1,653,100
    Loss at Start-up (Start-up Expenses) $375,900
    TOTAL CAPITAL $2,029,000
    TOTAL CAPITAL AND LIABILITIES $2,107,000
    Total Funding $1,653,100

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    Services

    The next important thing is finalizing the services that the business will offer. There can be a million services that an example of a fashion business plan can have, However, obviously, we cannot start providing every single one of the services. That will not be a smart move. We are a bunch of smart people and we need to make a really smart move in the fashion business plan samples that we create.

    The services included in this fashion business plan pdf will be:

    Costume Design

    The main service of the fashion industry will be to design costumes for movies and TV.

    Wedding Dress Design

    People who want designer dresses for their wedding can also hire our services to get the dresses designed.

    Theme Dress Design

    Dress designing for theme parties will also be one of the services.

    Custom-Made Accessories

    We will also design, manufacture, and commission custom-made fashion accessories for our customers.

    Marketing Analysis of Fashion Industry

    Business Plan for Investors

    The single most important part of any fashion business plan examples is the marketing analysis of the business. It is in this step that we have a look at what the market needs and how we can make a name in the market. This step is also a part of the streetwear brand business plan, but it is even more important here because the fashion industry is a congested one and the only way to make a profit is by careful marketing analysis.

    Market trends and marketing segmentation are some of the most important parts of any fashion business plan presentation. Let’s have a look at them.

    5.1 Market Trends

    Having a look at the market trends is very important for writing a fashion company business plan. If we have a look at the market trends of the industry over the last decade, people have moved towards economically priced fashion accessories and products. If we are in for starting a fashion label business plan, the best way is to offer premium goods at a discounted price. By doing that, we can get a lot of customers and make a lot of profit.

    5.2 Marketing Segmentation

    No fashion marketing plan example can be complete without the proper marketing segmentation. Here’s the marketing segmentation that faces our business:

    Fashion Industry Business Plan Template - Marketing Segmentation

    5.2.1 Showbiz

    The biggest market segment for the business will be the showbiz industry.

    5.2.2 Private Customers

    People who want custom-made dresses and accessories will also be a main market segment for us.

    5.2.3 Small Businesses

    Small businesses that show an interest in our business can sell our product and will make a market segment for us.

    5.2.4 Retail Customers

    The standard clothing and accessories made by the business will be sold through our own outlets to the retail customers.

    Market Analysis
    Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
    Showbiz 30% 35,000 36,000 38,000 40,000 41,000 10.00%
    Private Customers 27% 29,000 30,000 32,000 33,000 35,000 10.00%
    Small Businesses 23% 21,000 23,000 25,000 27,000 28,000 10.00%
    Retail Customers 20% 18,000 19,000 21,000 23,000 25,000 11.00%
    Total 100% 103,000 108,000 116,000 123,000 129,000 10%

    5.3 Business Target

    • To become the most esteemed fashion goods producer in the world.
    • To make luxury fashion goods accessible for everyone.
    • To gain fame and recognition.

    5.4 Product Pricing

    The products of Apple Fashion will be priced below what the competition asks for their products. This will be done to make sure that we get business and the goal of making fashion products affordable for everyone can be realized.

    Marketing Strategy

    Just like a sewing business plan, we need to have a solid marketing strategy to make the business a success. This sample fashion business plan does contain that and will guide you how to use it. While making a marketing strategy for business plan examples fashion, the things that you need to focus on include the competitive analysis and sales strategy. Once you complete that, you can easily start the business and make it a success.

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    6.1 Competitive Analysis

    Here’s the competitive analysis for this fashion business proposal:

    1. We have better designer than any of the competing brands in Europe.
    2. Our prices are lower than all of the competitors.
    3. We have a better sales strategy than any of the other companies in the sector.

    6.2 Sales Strategy

    If you want to know how to write a fashion article, you’ll need to be able to make sales strategy for the business. Here’s the sales strategy:

    • We will hire the services of celebs to promote and endorse the product.
    • Discounted rates will be offered to the buyers at the start.
    • We will offer better value for money compared with any other of the competitors.

    6.3 Sales Monthly

    Fashion Industry Business Plan Template - Sales Monthly

    6.4 Sales Yearly

    Fashion Industry Business Plan Template - Sales Yearly

    6.5 Sales Forecast

    Fashion Industry Business Plan Template - Unit Sales

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    Sales Forecast
    Unit Sales Year 1 Year 2 Year 3
    Costume Design 50,000 53,000 56,180
    Wedding Dress Design 44,000 46,640 49,438
    Theme Dress Design 52,000 55,120 58,427
    Custom-Made Accessories 40,000 42,400 44,944
    TOTAL UNIT SALES 186,000 197,160 208,990
    Unit Prices Year 1 Year 2 Year 3
    Costume Design $51.00 $59.16 $68.63
    Wedding Dress Design $60.00 $69.60 $80.74
    Theme Dress Design $53.00 $61.48 $71.32
    Custom-Made Accessories $42.00 $48.72 $56.52
    Sales
    Costume Design $2,550,000.00 $3,135,480.00 $3,855,386.21
    Wedding Dress Design $2,640,000.00 $3,246,144.00 $3,991,458.66
    Theme Dress Design $2,756,000.00 $3,388,777.60 $4,166,840.94
    Custom-Made Accessories $1,680,000.00 $2,065,728.00 $2,540,019.15
    TOTAL SALES $9,626,000.00 $11,836,129.60 $14,553,704.96
    Direct Unit Costs Year 1 Year 2 Year 3
    Costume Design $49.00 $56.00 $64.00
    Wedding Dress Design $58.00 $66.00 $76.00
    Theme Dress Design $51.00 $58.00 $67.00
    Custom-Made Accessories $40.00 $45.00 $52.00
    Direct Cost of Sales
    Costume Design $2,450,000.00 $2,968,000.00 $3,595,520.00
    Wedding Dress Design $2,552,000.00 $3,078,240.00 $3,757,318.40
    Theme Dress Design $2,652,000.00 $3,196,960.00 $3,914,622.40
    Custom-Made Accessories $1,600,000.00 $1,908,000.00 $2,337,088.00
    Subtotal Direct Cost of Sales $9,254,000.00 $11,151,200.00 $13,604,548.80

    Personnel plan

    Just like we discussed in the thrift store business plan, it all comes down to the people that will run the fashion business plan sample pdf and will make it a commercial success. It is also in the objectives of a fashion business to make sure that we create employment for people. The company will be run by the following people.

    7.1 Company Staff

    • Sarah Carnegie will be the owner and CEO of the business.
    • 2 managers for operations, external relations marketing.
    • 6 Fashion designers.
    • 2 Brand Ambassadors.
    • 2 Social media promoters.
    • 2 Web developers.
    • 1 Retail shopkeeper.
    • 1 guard.
    • 1 reception clerk.
    • 1 telephone operator.

    7.2 Average Salary of Employees

    Personnel Plan
    Year 1 Year 2 Year 3
    Operations Manager $13,000 $14,300 $15,730
    External Relations Marketing $12,000 $13,200 $14,520
    Fashion Designers $60,000 $66,000 $72,600
    Brand Ambassadors $20,000 $22,000 $24,200
    Social Media Promoters $20,000 $22,000 $24,200
    Web Developers $18,000 $19,800 $21,780
    Retail Shopkeeper $10,000 $11,000 $12,100
    Reception Clerk $8,000 $8,800 $9,680
    Guard $9,000 $9,900 $10,890
    Telephone Operator $7,000 $7,700 $8,470
    Total Salaries $177,000 $194,700 $214,170

    Financial Plan

    Before we wrap up the  fashion business plan template pdf, it is important to have a look at the money involved in starting the business. This business will cost more money to start than the embroidery business plan. We will need money for:

    • The cost of setting up the store.
    • Setting up the production facility.
    • The salaries of employees for the time before we start making profit.
    • The cost of marketing and promoting the business.

    8.1 Important Assumptions

    General Assumptions
    Year 1 Year 2 Year 3
    Plan Month 1 2 3
    Current Interest Rate 8.15% 8.21% 8.26%
    Long-term Interest Rate 8.39% 8.45% 8.50%
    Tax Rate 24.12% 24.45% 25.80%
    Other 0 0 0

    8.2 Break-even Analysis

    Fashion Industry Business Plan Template - Break-even Analysis

    Break-Even Analysis
    Monthly Units Break-even 5340
    Monthly Revenue Break-even $132,600
    Assumptions:
    Average Per-Unit Revenue $234.00
    Average Per-Unit Variable Cost $0.66
    Estimated Monthly Fixed Cost $163,400

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    8.3 Projected Profit and Loss

    Pro Forma Profit And Loss
    Year 1 Year 2 Year 3
    Sales $9,626,000 $11,836,130 $14,553,705
    Direct Cost of Sales $9,254,000 $11,151,200 $13,604,549
    Other $0 $0 $0
    TOTAL COST OF SALES $9,254,000 $11,151,200 $13,604,549
    Gross Margin $372,000 $684,930 $949,156
    Gross Margin % 3.86% 5.79% 6.52%
    Expenses
    Payroll $177,000 $194,700 $214,170
    Sales and Marketing and Other Expenses $135,700 $139,000 $144,000
    Depreciation $2,200 $2,350 $2,480
    Leased Equipment $0 $0 $0
    Utilities $2,900 $3,000 $3,100
    Insurance $2,100 $2,100 $2,100
    Rent $2,700 $2,800 $2,900
    Payroll Taxes $30,000 $31,000 $32,000
    Other $0 $0 $0
    Total Operating Expenses $352,600 $374,950 $400,750
    Profit Before Interest and Taxes $19,400 $309,980 $548,406
    EBITDA $19,400 $309,980 $548,406
    Interest Expense $0 $0 $0
    Taxes Incurred $3,880 $61,996 $109,681
    Net Profit $15,520 $247,984 $438,725
    Net Profit/Sales 0.16% 2.10% 3.01%

    8.3.1 Profit Monthly

    Fashion Industry Business Plan Template - Profit Monthly

    8.3.2 Profit Yearly

    Fashion Industry Business Plan Template - Profit Yearly

    8.3.3 Gross Margin Monthly

    Fashion Industry Business Plan Template - Gross Margin Monthly

    8.3.4 Gross Margin Yearly

    Fashion Industry Business Plan Template - Gross Margin Yearly

    8.4 Projected Cash Flow

    Fashion Industry Business Plan Template - Projected Cash Flow

    Pro Forma Cash Flow
    Cash Received Year 1 Year 2 Year 3
    Cash from Operations
    Cash Sales $54,000 $58,320 $62,986
    Cash from Receivables $20,000 $21,600 $23,328
    SUBTOTAL CASH FROM OPERATIONS $74,000 $80,660 $87,113
    Additional Cash Received
    Sales Tax, VAT, HST/GST Received $0 $0 $0
    New Current Borrowing $0 $0 $0
    New Other Liabilities (interest-free) $0 $0 $0
    New Long-term Liabilities $0 $0 $0
    Sales of Other Current Assets $0 $0 $0
    Sales of Long-term Assets $0 $0 $0
    New Investment Received $0 $0 $0
    SUBTOTAL CASH RECEIVED $74,000 $81,000 $88,000
    Expenditures Year 1 Year 2 Year 3
    Expenditures from Operations
    Cash Spending $42,000 $43,000 $45,000
    Bill Payments $23,000 $28,000 $31,000
    SUBTOTAL SPENT ON OPERATIONS $65,000 $71,000 $76,000
    Additional Cash Spent
    Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
    Principal Repayment of Current Borrowing $0 $0 $0
    Other Liabilities Principal Repayment $0 $0 $0
    Long-term Liabilities Principal Repayment $0 $0 $0
    Purchase Other Current Assets $0 $0 $0
    Purchase Long-term Assets $0 $0 $0
    Dividends $0 $0 $0
    SUBTOTAL CASH SPENT $65,000 $70,200 $75,816
    Net Cash Flow $19,000 $20,000 $22,000
    Cash Balance $30,000 $31,000 $32,000

    8.5 Projected Balance Sheet

    Pro Forma Balance Sheet
    Assets Year 1 Year 2 Year 3
    Current Assets
    Cash $278,000 $311,360 $342,496
    Accounts Receivable $25,000 $28,000 $31,472
    Inventory $4,200 $4,704 $4,900
    Other Current Assets $1,000 $1,000 $1,000
    TOTAL CURRENT ASSETS $286,000 $320,320 $360,040
    Long-term Assets
    Long-term Assets $10,000 $10,000 $10,000
    Accumulated Depreciation $19,400 $21,728 $24,444
    TOTAL LONG-TERM ASSETS $24,000 $26,880 $30,240
    TOTAL ASSETS $294,000 $329,280 $370,440
    Liabilities and Capital Year 4 Year 5 Year 6
    Current Liabilities
    Accounts Payable $19,200 $21,504 $24,170
    Current Borrowing $0 $0 $0
    Other Current Liabilities $0 $0 $0
    SUBTOTAL CURRENT LIABILITIES $19,000 $21,280 $23,919
    Long-term Liabilities $0 $0 $0
    TOTAL LIABILITIES $16,500 $18,480 $20,772
    Paid-in Capital $30,000 $30,000 $31,000
    Retained Earnings $56,000 $61,040 $67,144
    Earnings $199,000 $216,910 $238,601
    TOTAL CAPITAL $287,000 $312,830 $344,113
    TOTAL LIABILITIES AND CAPITAL $303,500 $329,280 $370,440
    Net Worth $298,000 $324,820 $357,302

    8.6 Business Ratios

    Ratio Analysis
    Year 1 Year 2 Year 3 INDUSTRY PROFILE
    Sales Growth 7.28% 8.07% 8.94% 3.00%
    Percent of Total Assets
    Accounts Receivable 9.28% 10.28% 11.39% 9.80%
    Inventory 5.44% 6.03% 6.68% 9.90%
    Other Current Assets 2.30% 2.55% 2.82% 2.40%
    Total Current Assets 151.00% 152.00% 152.00% 158.00%
    Long-term Assets 11.50% 11.60% 11.64% 12.00%
    TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
    Current Liabilities 4.96% 5.00% 5.05% 4.34%
    Long-term Liabilities 0.00% 0.00% 0.00% 0.00%
    Total Liabilities 7.45% 7.51% 7.58% 7.38%
    NET WORTH 100.58% 101.38% 102.32% 110.00%
    Percent of Sales
    Sales 100.00% 100.00% 100.00% 100.00%
    Gross Margin 94.80% 97.36% 100.09% 99.00%
    Selling, General & Administrative Expenses 93.59% 96.12% 98.81% 97.80%
    Advertising Expenses 1.51% 1.55% 1.59% 1.40%
    Profit Before Interest and Taxes 41.00% 42.11% 43.29% 33.90%
    Main Ratios
    Current 34 35 36 32
    Quick 34 35.2 36.08 33
    Total Debt to Total Assets 0.18% 0.17% 0.17% 0.40%
    Pre-tax Return on Net Worth 74.00% 74.70% 75.00% 75.00%
    Pre-tax Return on Assets 95.00% 99.75% 104.74% 111.30%
    Additional Ratios Year 1 Year 2 Year 3
    Net Profit Margin 33.00% 34.02% 35.08% N.A.
    Return on Equity 55.20% 56.91% 58.68% N.A.
    Activity Ratios
    Accounts Receivable Turnover 7.7 7.8 7.8 N.A.
    Collection Days 100 100 100 N.A.
    Inventory Turnover 32.4 34.02 33 N.A.
    Accounts Payable Turnover 15 16 16.3 N.A.
    Payment Days 27 27 27 N.A.
    Total Asset Turnover 2.5 2.5 2.6 N.A.
    Debt Ratios
    Debt to Net Worth -0.04 -0.03 -0.04 N.A.
    Current Liab. to Liab. 1 1 1 N.A.
    Liquidity Ratios
    Net Working Capital $249,000 $262,944 $277,669 N.A.
    Interest Coverage 0 0 0 N.A.
    Additional Ratios
    Assets to Sales 0.86 0.87 0.87 N.A.
    Current Debt/Total Assets 1% 0% 0% N.A.
    Acid Test 29.5 29.8 29.9 N.A.
    Sales/Net Worth 2.1 2.2 2.3 N.A.
    Dividend Payout 0 0 0 N.A.

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