Why do fashion brands need a business plan?
Every business needs to have a written business plan, whether it’s to provide direction or attract investors. A business plan is vital for the success of your organization.
So what is a business plan?
A business plan is a document describing a business, its products or services, how it earns (or will earn) money, its leadership and staffing, it’s financing, its operations model, and many other details essential to its success.
So why do fashion brands need a business plan?
The miss conception is that a business is only for businesses seeking investment and that’s not true. A business plan can be used for numerous different reasons (see below). I truly believe that the reason why fashion brands need a business plan is to translate their creative vision into a brand.
“We had a marketing background, but not much experience in the other functions needed to run a fashion eCommerce business, like operations, finance, production, and tech. Laying out a business plan helped us identify the “unknown”, and made it easier to sport the gaps where we’d need help or, at the very least, to skill up ourselves.”
—Jordan Barnett, Kapow Meggings
Aside from using a business plan for investments. Other outcomes are:
- Planning. Writing out a plan is an invaluable exercise for clarification.
- Evaluating ideas. It will help you to focus on your final product and service.
- Seeing it written down in black and white is a great exercise to cement plans.
- Research. By writing a business plan it will have forced you to complete the necessary, even crucial research you need to complete when building a fashion brand.
- Recruitment. Your business plan is one of the easiest ways to communicate your vision when on-boarding new team members, even contractors.
- Partnerships. If you plan to approach B2B or B2C channels, having a clear overview of your vision, audience, and strategy will make it easier to decide if they are right for you.
- Competitions. Google runs business plan competitions so enter them! Why not gain more exposure!
"I truly believe that the reason why fashion brands need a business plan is to translate their creative vision into a brand."
Here are some tips to create an effective, successful business plan.
Keep it short and to the point.
- No matter who you’re writing for, your business plan should be short and readable—generally no longer than 15 to 20 pages. If you do have additional documents you think may be useful to your audience and your goals, consider adding them as appendices.
- Don’t tell a life story, be concise and precise.
- Talk about the opportunity and how your fashion brand will fill it.
- Consider a business plan as a pitch in a document.
Keep the tone, style, and voice consistent.
- This is best managed by having a single person write the plan or allowing time for the plan to be properly edited before distributing it.
- Always get someone to proofread it.
Know your audience.
- Write your plan using language that your audience will understand.
- Remember that this is a formal document so unless you think it is truly necessary, avoid using ‘chat’ language.
Don’t be intimidated.
- Did you know that the vast majority of business owners and entrepreneurs aren’t business experts? They don’t have MBAs or accountancy degrees. They’re learning as they go and find tools and resources to help them.
Here are some meaningful statistics from Forbes:
- The most successful entrepreneurs were those that wrote their business plan between 6-12 months after deciding to start a business. Stating that this “increased the probability of venture viability success by 8%”.
- Chances of success rose by 12% for those that spent no longer than 3 months on their plan. With any longer proving futile.
6-12 months might seem a long time, but it’s not. Doctors train for 8-years and engineers for 4 years before gaining their dream job! Never forget all the work specifically research you need to do to ensure you have you identified a niche market with growth potential where you have a competitive advantage.
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Are you now feeling intimated or inspired?
Don’t worry you’re only human! Either way, we can help you further by teaching you the contents of a fashion business plan and exactly how to complete it along with the research needed to build a fashion business.
To learn more about our 6-step course click here.