Table of Content

    Do you want to start sewing business plan?

    Do you want to start a sewing business? Well, the sewing business can be a profitable and enjoyable business for anyone interested in inventing new fashions and designs. Almost everybody wants to dress up in his/her best as it generates in one a confidence and boasts ones’ spirits by creating a sensation that you are something.

    Although the business has wide scope but you have to plan many things before taking a startup as you will not be working individually. So, the first step before starting a home sewing business  is to make a detailed business plan for your startup. If you are having trouble while writing a business plan, you can take help from this sample business plan written for a sewing business startup named, ‘Naomi Sewing Center.’

    Executive Summary

    2.1 The Business

    Naomi Sewing Center will be located in Manhattan, the most populous borough of the New York City, housing about 1.6 million people. The business will be based on tailoring or stitching clothes, designing latest patterns as desired by the customers, doing embroidery and inventing modish fashions for the people. Naomi Sewing Center will provide an excellent service and guide the customers about what suits them the best to provide them the product that mark the highest level of satisfaction and comfort for them. We’ll also sell some ready-made dresses and provide the facility of purchasing online products to the residents of nearby boroughs.

    2.2 Management

    The core of every business is its management system, the success of your business varies with your ability to monitor it, thus, to be precise you should include in your sewing business plan  the details about what steps you will have to take to operate your business effectively.

    Naomi Winslet will be the owner and manager of the business, to execute her sewing business ideas, Naomi will hire a group of professional sewers, purchase sewing machines, and appoint a section of her large apartment to create the environment of work. There will be an organized and separate section for the customers to book their orders, they will provide with the new design samples and will be thoroughly guided by our professional fashion designer that which fashion will suits them the best.

    2.3 Customers

    If you are looking for how to start a sewing business, you should first think that for whom you are providing your services. Knowing your customers in the only thing that one can do to understand their needs and demands. The primary customers of our sewing center will mostly be ladies, men and cloth merchants living in Manhattan. Basically, we’ll be serving only in Manhattan but later, we’ll widen our business scales to the other boroughs of New York City too.

    2.4 Target of the Company

    The company aims to provide unique, modern, and high-class stitching service to the residents of Manhattan, and to become the most renowned stitching center of our borough within the next two years of the launch.

    Bank/SBA Business Plan
    Document for raising debt funding from financial institutions to meet the expectations of the banks, SBA, and government agencies.

    Company Summary

    3.1 Company Owner

    Naomi Winslet will be the owner of the company. Naomi has an education in Fashion Design and Merchandising from Missouri State University. Besides, Naomi has seven years of experience of designing clothes and inventing newer fashions, she also has been teaching and schooling her skills for the last two years.

    3.2 Why the Business is being started

    Due to the prior experience of Naomi, her interest towards the fashion designing and the enthusiasm of her apprentices to work tirelessly with her, have compelled her to think about starting a sewing business. She is basically going to start home sewing business, to widen the scale of her servings and to find more and more opportunities in this field while working in her own apartment.

    3.3 How the Business will be started

    Naomi has decided to convert a section of her house in a comfortable working area for the fashion designer and professional sewers to work on sewing machines. Naomi will hire the sewers she had been tutoring for stitching, yet she’ll also require some extra co-workers and a co-manager for running the business smoothly.

    Naomi has planned everything about her business and she has hired an expert to map her thoughts and goals in an organized way by making a business plan which is given here for your help. The startup requirements are given below.

    The detailed startup requirements are as follows:

    Start-up Expenses  
    Legal $55,300
    Consultants $0
    Insurance $32,750
    Rent $32,500
    Research and Development $32,750
    Expensed Equipment $32,750
    Signs $1,250
    TOTAL START-UP EXPENSES $187,300
    Start-up Assets $0
    Cash Required $332,500
    Start-up Inventory $32,625
    Other Current Assets $232,500
    Long-term Assets $235,000
    TOTAL ASSETS $121,875
    Total Requirements $245,000
    START-UP FUNDING $0
    START-UP FUNDING $273,125
    Start-up Expenses to Fund $11,875
    Start-up Assets to Fund $15,000
    TOTAL FUNDING REQUIRED $0
    Assets $23,125
    Non-cash Assets from Start-up $18,750
    Cash Requirements from Start-up $0
    Additional Cash Raised $18,750
    Cash Balance on Starting Date $21,875
    TOTAL ASSETS $0
    Liabilities and Capital $0
    Liabilities $0
    Current Borrowing $0
    Long-term Liabilities $0
    Accounts Payable (Outstanding Bills) $0
    Other Current Liabilities (interest-free) $0
    TOTAL LIABILITIES $0
    Capital $0
    Planned Investment $0
    Investor 1 $332,500
    Investor 2 $0
    Other $0
    Additional Investment Requirement $0
    TOTAL PLANNED INVESTMENT $695,000
    Loss at Start-up (Start-up Expenses) $313,125
    TOTAL CAPITAL $251,875
    TOTAL CAPITAL AND LIABILITIES $251,875
    Total Funding $255,000

    Any questions? Get in Touch!

    Services for customers

    Before thinking about how to start a small sewing business, you should think about the type of services you want to provide your customers. To start a sewing business  you are required to provide the basic stitching services, yet to take a lead upon all your competitors, you are required to provide some additional and unique services to your customers too.

    Naomi has decided to provide the following services initially:

    • Designing and Stitching Female & Male Attires: We will stitch traditional, non-traditional, fancy, simple daily use, modern and stylish dresses, frocks and coats for women with their desired embroidery or patterns. We will also design and stitch traditional or non-traditional shirts, pants, and coats for male customers also.
    • Designing and Stitching Attires for Children: We will also stitch fancy and simple cloths and coats for the children.
    • Mending Stitched Clothes: We will repair any type of defect in your stitched cloth such as fitting defects or if your dress is ripped or any other case by attaching a patch, doing embroidery or by adopting any other method.
    • Selling Ready-Made Dresses Online: Besides stitching the given cloths, we’ll also sell some ready-made clothes by displaying them on our site providing the facility of making an online purchase to our customers.

    Marketing Analysis of Sewing Business

    Marketing analysis is one of the most important deciding factors that can contribute towards the success of your startup. In your business plan for sewing company, you should add a detailed analysis of the market in which you are going to start your business. It is really important to know the market trends and latest market demands to make a precise sewing business plan template.

    Marketing analysis also helps you in deciding the steps you will have to take to advertise your business and make a contact to your target customer groups. Considering the importance of marketing analysis in a business plan, Naomi had hired the services of a professional expert to do an accurate marketing analysis and make a business plan for home sewing business template  for her business.

    Note

    You can also take help from this business plan for home sewing business  if you are looking for how to start sewing business, but if you are starting your business at a large scale then instead of taking help from this sewing business plan sample  you must consult a professional, or take assistance from business plan for sewing factory.

    5.1 Market Trends

    Before starting any business, it is really important to know the market trends, and practices, and an assessment of whether the market in which you are going to initiate your business has the potential of a new startup or not.

    The most important aspect of this business is that it is a dynamic and one of those businesses which keep blooming throughout the year changing and adapting newest fashions no matter what season it is. According to IBISWorld, there are currently 18,979 cut and sewing businesses running in the United States generating a revenue of $2 billion annually. The number of these businesses is high in the market yet the demand for new startups is also high, IBISWorld has reported a 0.4% growth rate for the sewing business. The business is also responsible for employing more than 42 thousand people of the United States.

    All these statistics show that you can also generate a profit which is multiple times than that which you had invested, provided that you market your business properly and effectively.

    5.2 Marketing Segmentation

    It is crucial to analyze your target market by dividing them into separate groups, to thoroughly understand their requirements and demands. In this business plan sample for sewing business, we have provided the marketing plan of Naomi Sewing Center. You can easily download sewing business plan pdf  from our website, but if you are starting at an industrial scale, then it is advisable to hire the services of a marketing analyst to make a plan according to your dimensions. Our target markets are as follows:

    The detailed marketing segmentation of our target audience is as follows.

    Strategic/Operational Business Plan

    5.2.1 Residents

    It is a dream of every woman to take a lead upon all others in the race of empowerment, fashion and personal aesthetics, that came from the colors, prints, and designs they wear. Our expert has identified the female community of Manhattan and nearby boroughs as our potential customers. These women will surely consume our services and contribute a substantial portion of our sales to make a unique and most suited attire for them that lightens their beauty and sartorial confidence. We’ll also stitch dresses and coats for the male residents of our society as well as children.

    This group of our target customers will also avail our services of resolving the issue regarding their stitched clothes.

    5.2.2 Departmental Stores

    Our next target customers will be the owners and managers of departmental stores who are expected to give us orders of stitching clothes in large numbers. We will offer special discounts to them as working with them on the same sizes and designs will be easy for us. Our workforce doesn’t allow us to take very large orders, however, we can entertain their needs, on smaller levels.

    5.2.3 Online Purchasers

    As we will be providing free home delivery for our ready-made products in the nearby boroughs so our third category will comprise of the online purchasers who will be briefed about our stitched clothes on our website before giving order to us.

    The detailed market analysis of our potential customers is given in the following table:

    Market Analysis
    Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
    Residents 32% 11,433 13,344 16,553 18,745 20,545 13.43%
    Departmental Stores 48% 22,334 32,344 43,665 52,544 66,432 10.00%
    Online Purchasers 20% 12,867 14,433 15,999 17,565 19,131 15.32%
    Total 100% 46,634 60,121 76,217 88,854 106,108 9.54%
    Any questions? Get in Touch

    5.3 Business Target

    We aim at becoming the best stitching center in our borough and the most renowned in our nearby areas. Our target to be achieved within the 12 months of our launch is to balance our startup costs and investments group from business plan with the profit earned and to achieve the net profit margin of $25k per month by the end of the first year. Our long-term goal to be achieved after the 10 years of our launch is to enlarge our business and widen the ranges of our home deliveries.

    5.4 Product Pricing

    Naomi has earned a large fame over the past few years, she had never compromised on the work quality, that’s why she hasn’t priced her services low, rather her prices are a bit higher than her competitors, as the business is located in an area where people have usually higher incomes who don’t mind spending cash on their desired things and services, so Naomi believe that she and her business can still survive in the market even with higher rates.

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    Strategy

    To avail all the sewing business opportunities and to be successful in your domain, you must have an excellent sales strategy to introduce your services to your target groups. Here we are providing sample business plan in sewing  domain to help you in deciding your sales strategy.

    6.1 Competitive Analysis

    Our biggest competitive advantage is our locality, we are located in an area where people don’t compromise their dollars upon the service they trust and rely. Our second biggest competitive advantage lies in the power of our employees, the value which we will be giving to our customers can be estimated by the fact that we have employed a fashion designer as a co-manager of Naomi, just to guide the customers about what fashion and trend will suit them the best. Lastly, we will be displaying our ready-made products on our website for those who want to make an online purchase, we will also create a feedback section so that the new customers can read the previews of the previous ones.

    6.2 Sales Strategy

    Our experts have come up with the following ideas to advertise and sell ourselves.

    • We will advertise our services through print and social media and through our website
    • We will allow our customers to buy our products online with free home delivery
    • We will initially offer discounts on our services to encourage sales

    6.3 Sales Forecast

    Considering our innovative ideas and the quality of our services, our sales pattern is expected to increase with years. By analyzing our market segmentation strategy, our experts have forecasted the following sales on a yearly basis which are summarized in the column charts.

    The detailed information about sales forecast, total unit sales, total sales is given in the following table:

    Sales Forecast      
    Unit Sales Year 1 Year 2 Year 3
    Female & Male Attires 1,887,030 2,680,320 2,588,240
    Children Attires 802,370 815,430 823,540
    Mending Stitched Clothes 539,320 770230 1,002,310
    Ready-made Dresses 265,450 322,390 393,320
    TOTAL UNIT SALES 3,494,170 4,588,370 4,807,410
    Unit Prices Year 1 Year 2 Year 3
    Female & Male Attires $140.00 $150.00 $160.00
    Children Attires $600.00 $800.00 $1,000.00
    Mending Stitched Clothes $700.00 $800.00 $900.00
    Ready-made Dresses $650.00 $750.00 $850.00
    Sales
    Female & Male Attires $2,149,800 $2,784,000 $3,383,200
    Children Attires $120,050 $194,500 $268,500
    Mending Stitched Clothes $50,110 $71,600 $93,000
    Ready-made Dresses $139,350 $194,600 $249,850
    TOTAL SALES
    Direct Unit Costs Year 1 Year 2 Year 3
    Female & Male Attires $0.70 $0.80 $0.90
    Children Attires $0.40 $0.45 $0.50
    Mending Stitched Clothes $0.30 $0.35 $0.40
    Ready-made Dresses $3.00 $3.50 $4.00
    Direct Cost of Sales
    Female & Male Attires $989,300 $1,839,000 $2,679,700
    Children Attires $66,600 $119,900 $173,200
    Mending Stitched Clothes $17,900 $35,000 $52,100
    Ready-made Dresses $19,400 $67,600 $115,800
    Subtotal Direct Cost of Sales $1,294,100 $1,699,400 $2,104,700

    6.4 Sales Monthly

    6.5 Sales Yearly

    Any questions? Get in Touch!

    Personnel Plan

    Your workforce will decide whether you will be able to run your business successfully or not. So, in your tailoring business plan sample, you must create a list of the staff required to run your business as well as their jobs descriptions. In case you are having difficulty with making your knitting sewing service business plan, you can take help from this sample business plan of Naomi Stitching Center.

    7.1 Company Staff

    Naomi will be the owner and manager herself, yet she’ll hire the following people.

    • 1 Assistant Manager to assist in managing operations
    • 10 Professional Sewers for stitching and repairing clothes
    • 2 Accountants to maintain financial records
    • 1 Fashion Designer for working on new ideas and for guiding customers
    • 4 General Workers for keeping the display and records of customers
    • 2 Drivers for providing home delivery to the online purchasers
    • 1 Front Desk Officer to act as receptionist
    • 1 IT Expert to manage the company’s website

    7.2 Average Salary of Employees

     Personnel Plan      
    Year 1 Year 2 Year 3
    Accountants $85,000 $95,000 $105,000
    Assistant Manager $45,000 $50,000 $55,000
    Professional Sewers $550,000 $650,000 $750,000
    Fashion Designer $152,000 $159,000 $166,000
    General Workers $145,000 $152,000 $159,000
    Drivers $50,000 $55,000 $60,000
    Front Desk Officer $187,000 $194,000 $201,000
    IT Expert $42,000 $45,000 $48,000
    Total Salaries $152,000 $159,000 $166,000

    Financial Plan

    The final step you’ll have to take if you are starting a sewing business is to make a financial plan to determine the cost to run a sewing business. Your financial plan should cover the details about sewing business profit that you can earn and the details about how will you manage your startup costs, the salaries of your employees besides achieving your major financial goals.

    8.1 Important Assumptions

     General Assumptions      
    Year 1 Year 2 Year 3
    Plan Month 1 2 3
    Current Interest Rate 10.00% 11.00% 12.00%
    Long-term Interest Rate 10.00% 10.00% 10.00%
    Tax Rate 26.42% 27.76% 28.12%
    Other 0 0 0

     

    8.2 Brake-even Analysis

     Brake-Even Analysis  
    Monthly Units Break-even 5530
    Monthly Revenue Break-even $159,740
    Assumptions:
    Average Per-Unit Revenue $260.87
    Average Per-Unit Variable Cost $0.89
    Estimated Monthly Fixed Cost $196,410

     

    8.3 Projected Profit and Loss

     Pro Forma Profit And Loss      
    Year 1 Year 2 Year 3
    Sales $309,069 $385,934 $462,799
    Direct Cost of Sales $15,100 $19,153 $23,206
    Other $0 $0 $0
    TOTAL COST OF SALES $15,100 $19,153 $23,206
    Gross Margin $293,969 $366,781 $439,593
    Gross Margin % 94.98% 94.72% 94.46%
    Expenses
    Payroll $138,036 $162,898 $187,760
    Sales and Marketing and Other Expenses $1,850 $2,000 $2,150
    Depreciation $2,070 $2,070 $2,070
    Leased Equipment $0 $0 $0
    Utilities $4,000 $4,250 $4,500
    Insurance $1,800 $1,800 $1,800
    Rent $6,500 $7,000 $7,500
    Payroll Taxes $34,510 $40,726 $46,942
    Other $0 $0 $0
    Total Operating Expenses $188,766 $220,744 $252,722
    Profit Before Interest and Taxes $105,205 $146,040 $186,875
    EBITDA $107,275 $148,110 $188,945
    Interest Expense $0 $0 $0
    Taxes Incurred $26,838 $37,315 $47,792
    Net Profit $78,367 $108,725 $139,083
    Net Profit/Sales 30.00% 39.32% 48.64%

    8.3.1 Profit Monthly

    8.3.2 Profit Yearly

    8.3.3 Gross Margin Monthly

    8.3.4 Gross Margin Yearly

    8.4 Projected Cash Flow

     Pro Forma Cash Flow      
    Cash Received Year 1 Year 2 Year 3
    Cash from Operations
    Cash Sales $40,124 $45,046 $50,068
    Cash from Receivables $7,023 $8,610 $9,297
    SUBTOTAL CASH FROM OPERATIONS $47,143 $53,651 $59,359
    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 $47,143 $53,651 $55,359
    Expenditures Year 1 Year 2 Year 3
    Expenditures from Operations
    Cash Spending $21,647 $24,204 $26,951
    Bill Payments $13,539 $15,385 $170,631
    SUBTOTAL SPENT ON OPERATIONS $35,296 $39,549 $43,582
    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 $35,296 $35,489 $43,882
    Net Cash Flow $11,551 $13,167 $15,683
    Cash Balance $21,823 $22,381 $28,239

    8.5 Projected Balance Sheet

     Pro Forma Balance Sheet      
    Assets Year 1 Year 2 Year 3
    Current Assets
    Cash $184,666 $218,525 $252,384
    Accounts Receivable $12,613 $14,493 $16,373
    Inventory $2,980 $3,450 $3,920
    Other Current Assets $1,000 $1,000 $1,000
    TOTAL CURRENT ASSETS $201,259 $237,468 $273,677
    Long-term Assets
    Long-term Assets $10,000 $10,000 $10,000
    Accumulated Depreciation $12,420 $14,490 $16,560
    TOTAL LONG-TERM ASSETS $980 $610 $240
    TOTAL ASSETS $198,839 $232,978 $267,117
    Liabilities and Capital Year 1 Year 2 Year 3
    Current Liabilities
    Accounts Payable $9,482 $10,792 $12,102
    Current Borrowing $0 $0 $0
    Other Current Liabilities $0 $0 $0
    SUBTOTAL CURRENT LIABILITIES $9,482 $10,792 $12,102
    Long-term Liabilities $0 $0 $0
    TOTAL LIABILITIES $9,482 $10,792 $12,102
    Paid-in Capital $30,000 $30,000 $30,000
    Retained Earnings $48,651 $72,636 $96,621
    Earnings $100,709 $119,555 $138,401
    TOTAL CAPITAL $189,360 $222,190 $255,020
    TOTAL LIABILITIES AND CAPITAL $198,839 $232,978 $267,117
    Net Worth $182,060 $226,240 $270,420

     

    8.6 Business Ratios

     Ratio Analysis        
    Year 1 Year 2 Year 3 Industry Profile
    Sales Growth 4.35% 30.82% 63.29% 4.00%
    Percent of Total Assets 4.35% 4.71% 5.80%  9.80%
    Accounts Receivable 5.61% 4.71% 3.81% 9.70%
    Inventory 1.85% 1.82% 1.79% 9.80%
    Other Current Assets 1.75% 2.02% 2.29% 27.40%
    Total Current Assets 138.53% 150.99% 163.45% 54.60%
    Long-term Assets -9.47% -21.01% -32.55% 58.40%
    TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
    Current Liabilities 4.68% 3.04% 2.76% 27.30%
    Long-term Liabilities 0.00% 0.00% 0.00% 25.80%
    Total Liabilities 4.68% 3.04% 2.76% 54.10%
    NET WORTH 99.32% 101.04% 102.76% 44.90%
    Percent of Sales
    Sales 100.00% 100.00% 100.00% 100.00%
    Gross Margin 94.18% 93.85% 93.52% 0.00%
    Selling, General & Administrative Expenses 74.29% 71.83% 69.37% 65.20%
    Advertising Expenses 2.06% 1.11% 0.28% 1.40%
    Profit Before Interest and Taxes 26.47% 29.30% 32.13% 2.86%
    Main Ratios
    Current 25.86 29.39 32.92 1.63
    Quick 25.4 28.88 32.36 0.84
    Total Debt to Total Assets 2.68% 1.04% 0.76% 67.10%
    Pre-tax Return on Net Worth 66.83% 71.26% 75.69% 4.40%
    Pre-tax Return on Assets 64.88% 69.75% 74.62% 9.00%
    Additional Ratios Year 1 Year 2 Year 3
    Net Profit Margin 19.20% 21.16% 23.12% N.A.
    Return on Equity 47.79% 50.53% 53.27% N.A.
    Activity Ratios
    Accounts Receivable Turnover 4.56 4.56 4.56 N.A.
    Collection Days 92 99 106 N.A.
    Inventory Turnover 19.7 22.55 25.4 N.A.
    Accounts Payable Turnover 14.17 14.67 15.17 N.A.
    Payment Days 27 27 27 N.A.
    Total Asset Turnover 1.84 1.55 1.26 N.A.
    Debt Ratios
    Debt to Net Worth 0 -0.02 -0.04 N.A.
    Current Liab. to Liab. 1 1 1 N.A.
    Liquidity Ratios
    Net Working Capital $120,943 $140,664 $160,385 N.A.
    Interest Coverage 0 0 0 N.A.
    Additional Ratios
    Assets to Sales 0.45 0.48 0.51 N.A.
    Current Debt/Total Assets 4% 3% 2% N.A.
    Acid Test 23.66 27.01 30.36 N.A.
    Sales/Net Worth 1.68 1.29 0.9 N.A.
    Dividend Payout 0 0 0 N.A.

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