In the 10 years I have been in the custom apparel and hat wear business, I can not remember how many people called asking for help in starting their hat wear line. All of them believed they had a great idea. Most of them had little or no money. And none of them had a clue what it takes to make it in one of the most competitive businesses in America. The first question these people asked was always “How much to make my own custom design hats?” And always, I told them, as gently as I could, there is a whole lot of other questions they should ask first, and cost is perhaps the last one of them. I have always given these people my honest opinions while trying my best to encourage them. This article sums up all the advice I have given over the years. Subsequent articles will address each of the following steps individually in greater detail.
#1: Know Your Customer
Perhaps THE most important thing to do before starting any business! You should answer the following questions regarding your customers:
1. Who might be your customers?
2. How old are they?
3. How many of them are there?
4. Where do they shop?
5. How often do they shop?
6. How much do they tend to spend when they shop for hats or caps?
7. What is popular among these people right now?
Answers to these questions determine the niche to sell your caps in, what designs are appropriate, how many of your hats can you possible sell, and at what price.
#2: Know Your Competition
The 2nd most important thing to do before starting any business! You should answer the following questions regarding your competition:
1. Who may be your competition?
2. What types of hats and designs are they offering right now?
3. How much are they charging for these products?
4. Where do they sell their hats?
5. How are they marketing their hats?
Answers to these questions determine what designs you should offer, how much you should be charging, what channel of distribution you should consider, and the possible marketing venues you should consider when launching your own hat wear line.
#3: Know Your Marketing Plan
So what you have the greatest hat design of the decade if you can not get your products out there! Launching a hat wear line is all about marketing. Let me give you a very simple example. I have a customer, a real customer whose name I can not mention. These guys have some pretty cool design ideas. So they teamed up with a poker player, and hired a public relations person who is connected in the entertainment industry. These 2 people generated a lot of interests in their products! Before you know it, couple celebrities were wearing their designs, and the rest is history. So brainstorm, be creative, put your name out there! Who knows? You might be the next ROXY, or Quicksilver, or even NIKE!
#4: Know Your Start-up Cost
So you have figured out who your target customers are, who your competitions are, what hat designs you want to launch, and you have come up with the most creative marketing campaign. Now it is time to answer some cost-related questions:
1. Staffing and office rental
2. Marketing campaign costs
3. Travel expanses
4. Trade show expanses
5. Production relation costs:
(i) How much does it cost for sampling of your designs?
(ii) Who should you go to get prototype designs made?
(iii) Production run costs (largely depends on how many hats you want to produce for your launch. To get any reasonable price point, you need to order at least in the hundreds per design. 25 hats is NOT a wholesale quantity.)
#5: Financing
You have a plan to market your hat wear line; you know how much it will cost you; now you need to know how to finance your venture. Possible sources for money:
1. Your savings
2. Your friends and family
3. Mortgaging your current assets such as your house
4. Finding outside investors (although this might be difficult for starting a hat wear line, but you never know)
5. Borrowing from the bank (SBA loans are available for entrepreneurs in many cases)
#6: Know Your Launch Date
In fashion, timing is everything. Are you launching your hat wear line for the Christmas season? For the back-to-school season? For the 4th of July? Most overseas production takes 72 to up to 90 days via ocean freight. Say you are producing your hats in China. Do you know that the Chinese shut down for up to 15 days during Chinese New Year, which occurs on different dates, although mostly in January and February, depending on the year?
#7: Write Down Your Plan
You have gotten all the pieces of the puzzle; writing them down increases your chances of success. Your plan will keep you focused, and provide you with the big picture as well as the details you need to consider. And if you are trying to secure financing, a business plan is not only crucial, but absolutely necessary!
This is a simplified run-down for the essentials steps you need to take before starting a hat wear line. So be creative with your designs; be thorough with your research; be meticulous with your planning. And good luck! Please make sure to check my other articles regarding specific details on each of the above points. You might also want to check out my web sites for additional information.