Fashion businesses are established to make money by solving important problems. Without the money-making bit of it, no fashion business can survive.
That is why fashion entrepreneurs need to know factors that affect their money-making capabilities so they can tackle them head-on.
Last week, we reviewed a video by Kemi Omorogbe of Kemafrik on smartphone photography for fashion designers, and,
this week, we reviewed a video by Desola of Daisy’s Wardrobe on ‘Why Your Fashion Business is Not Making Money’. In it, she discussed things fashion entrepreneurs do that hinder their business for making money.
The video aims to open the eyes of fashion entrepreneurs to various factors that might be hindering their business from making money and see ways to solve them.
This video review will cover;
- useful points fashion entrepreneurs can learn from,
- important points missed out,
- the relevance of the information provided to fashion entrepreneurs.
Why Your Fashion Business is Not Making Money.
Every business goes through periods where things are slow and sales are not as great as they used to be. This is normal. But, when these situations persist for a prolonged period, it becomes a problem. Here are some factors that might contribute to that;
1. Greater Expenditure Than Income.
At times when your business is not doing as well as it used to, you need to ask yourself, is my expenditure greater than my income? That is, is the money that goes out of your business greater than the money that is coming in?
Your income is all the money you make from your business. Your expenditure is all the money that goes out of your business, it consists of your overhead, supplies, paid services, salary, and so on.
You need to understand that your business is a business and you need to control your expenditure as every business has its peak period and low period. If your expenditure if greater than your income it will lead to many challenges along the way.
If you cannot afford some things in your business, you have to look for ways to cut back and make it a bit cheaper until the business is making money or grows bigger. Cut out unnecessary staff roles and outsource when needed.
2. Too Many Discounts.
Giving discounts to your customers is great, but when it becomes too much, it causes problems. Discounting your products or services too much can do more good than harm for your business by way of growth.
We live in a part of the world where customers like to get everything for a bargain no matter how small it is. Some customers will want to get your products for half their selling price and you might be tempted to give in because you need the money, but remember that once you give it to them once they will always expect it.
Even though you need to be cordial and friendly with your customers, you also need to be firm and let those that cannot afford your services go. Sometimes, you can bend over backwards and give discounts to customers that buy many items from your store but there has to be a limit.
“My business is currently at this phase of not making money. To change the situation, I increased advertisements for my brand, but the turnover was low. I’m planning on doing new year sales to see how it goes. Honestly, giving discounts is good, but too much is bad. I see those that give discount every time as jokers. Who are they deceiving?” – Taiwo Bello, Creative Director Bellz Affairs, a fashion brand that deals in female fashion and skincare products.
3. Not Meeting Customers’ Expectations.
When people come to your business and they see what you do, the first thing that comes to their mind is, ‘how are you going to meet their expectations?’ It could be from customer service to pricing, the type of garment you make, finishing, and any other thing.
Customers always want to know if you can meet their expectations. If you can not meet them, frankly, they are not going to do business with you. Even if they do business with you, they won’t come back if you don’t deliver.
Your business will not make money if you are underpricing your products or services. If you are a bespoke fashion designer and people come to your business to make clothes and they frown at your price, let them go.
This may be hard when you are still at the startup stage of your business, but as time goes on, people will know you and get used to your pricing. That is how you carve a niche and market for yourself.
Your products or services will only be too expensive for those that are not your target market or ideal customer. This is why you have to define who your market is.
When you start underpricing your products initially, it will be hard for you to change your prices later on because you will lose customers. So, it is better to start well.
Customers are important and they make your dreams come true, but you need to also make a profit and run your business like a business.
Other Points Missed Out.
5. Not Getting Feedback.
As a fashion entrepreneur, feedback is highly important for your business. If you don’t know what to improve on, your business will keep losing money. This is why getting feedback from customers is important.
Always try as much as possible to get honest reviews and feedback from customers so you can know how to better serve them.
The Usefulness of the Information to Fashion Entrepreneurs.
Making money is an important part of running a fashion business, so, this video proves to be very helpful for fashion entrepreneurs. Sometimes, fashion entrepreneurs unknowingly do things that hinder their business from making money.
This video proves to be an eye-opener that is realistic and can help any fashion entrepreneur at any stage.