Fashion entrepreneurs and every business person need funding to keep a fashion business operating and successful. Whether you have investors or you are the sole investor who has bootstrapped the fashion business to date, ensuring that your investment is empowered to do its job and multiply is important.
This comes down to the people who manage each part of the business. On the flip side, this means that you also reduce the loopholes that can result in disaster for the business and consequently the money.
Here are 2 questions to ask at every point you have money coming in or flowing through a business.
Who do we want to be?
The purpose is the first thing that needs to be ascertained in every venture. As important as the question of purpose is to people, so is it to businesses. One famous quote reads, “If the purpose of something is not known, abuse is inevitable.”
As business leaders in the fashion industry, raising money for the business should only come when the answer to the question “Who do we want to be?” is known. Who do we want to design for, who do we serve with our products?
On May 24, a Nigerian tech company, Mono, raised $2 million from Entree Capital, Kuda co-founder and CEO Babs Ogundeyi and others. What was significant about this raise was the fact that it was to be used to bring a new definition to Mono.
Before the fundraising, the company was known for providing a way for fintechs like Carbon and Piggyvest to access the banking details of their subscribers. However, the startup decided to move into internet connectivity and start developing solutions that telecoms companies like MTN and Airtel can use and pay for. With this new purpose identified, Mono started reaching out to investors and raised a $2 million round which was majorly for its new purpose.
To avoid misusing money in a fashion business, funds must be attached to a purpose. The judicial use of the funds should then be decided based on the successful achievement of the predefined purpose.
What does the company need right now?
This is a simple yet salient question that fashion business executives need to constantly ask themselves. It is easy to get up and draft a to-do list, asking ourselves, “What do I want to do today?”
Your interests for that day may be in sewing the blouse that a customer ordered or making a quick stop to the Aleshinloye market in Ibadan or Idumota market in Lagos state. However, when you ask the question, “In this fashion business today, what needs to be done?”, you will get almost definitely get answers that will cause you to redefine your priorities.
One of the cases, when the leader’s focus changed after asking what needs to be done, is that of the 33rd US president, Harry Truman. When Truman became president, he knew he wanted to focus on the economic and social reforms of former President Roosevelt. However, when he asked what needed to be done, he realized that foreign affairs had the most priority and he began learning about it and taking necessary steps in that direction.
After wholistically looking at a fashion business, the immediate priorities appear with respect to the purpose of the business. Once these priorities are identified, that is where the money should go because that is the area where the results are expected.
Asking these questions and taking the answers seriously is a crucial factor for the effective management of the money invested in the fashion business. Beyond the money, it will also serve to direct the manpower and attention to where it is most needed. After the most important things have been done, the question needs to be asked again, “What does the company need to get done now?”
*The reference to Harry Truman can be found in Peter Drucker’s book: The Effective Manager.