How much cash do you need to start a small clothing line?

On Quora, someone asked me how much cash do you need to start a small menswear label? I haven’t responded over there yet, it was too long so I thought to post it here first. I frequently get variations of this question, a previous entry I wrote was how much does it cost to start a handbag line. My stock response is, how much does a house cost? Is it a dump in a crappy neighborhood or is it a restored pristine cottage on Martha’s Vineyard? The questioner asked me how much cash I would need and I wouldn’t be so boorish as to drill that down because why would he or she care? He or she would want to know what they can expect to pay, not what I would.

But then I thought, maybe I should answer the question literally in terms of how much cash I would need to start a menswear clothing line. That is a better question because most startups (nearly all) waste way too much money. Okay, so let’s unpack this. By the way, I suggest you hang around for this even if you don’t care one whit for menswear.

My first thought was “menswear label” is too broad, I’d have to determine my customer within the parameters of what I’m interested in producing. You need to do that too. Is your market young urban males, marathoners, bikers, C-level executives or your average IT guy? Each market has its own dictates for everything from styling and fitting in, to disposable income, signaling requirements and need. Since I have tons of menswear experience, I’d do casual western styled sportcoats at a mid range price point for men aged 35+. Forced to put a point to it, my ideal customer’s wife subscribes to Cowboys & Indians while he reads Western Horseman. I’d do that for a few reasons:

  1. It’s more of a design challenge (fun) with differing style lines.
  2. This customer is pickier than you’d ever imagine; cowboys with horsies aren’t hicks and they aren’t poor. They like to look nice; they have creases pressed in their dress jeans.
  3. As a group, they are more fit which makes profiling a fitting target much less dicey (read: less costly).
  4. It’s easier to get into wholesale. Since most western wear outlets are owned by individuals with strong ties to their communities, you can still approach a buyer or store owner with samples to gauge interest and possibly carry the line.
  5. It’s easier to find a rep, it’s a smaller market and everyone knows everyone. There aren’t a lot of market shows so one can stand out more in the few there are.
  6. There’s a hole in the market and has been for several years now. Why that is, is a long story. What happened is that others stepped in to fill the gap but not having to work so hard, got a bit complacent. I think that end of the business is long overdue for new blood to shake things up.

This doesn’t mean people should stampede into this or any other segment just to get their foot in the door, thinking it will give them a leg up until they can go on to whatever else it is that they really plan to do. Those of you who’ve been around already know that you start out doing one thing and end up doing something else. It’s no different from life itself. How many of you are doing exactly what you planned when you were a kid? I rest my case. Speaking of, that’s why it’s stupid to blow a lot of money on branding, IP, and all that before you have a product and initial sales interest. It’s also another reason your label shouldn’t be your company name. Your company name should be XYZ Enterprises, not Cochina Couture. Each label is a separate division with a separate identity; it makes it easier to sell them off if you decide to do that later on. However, based on past experience, a lot of new people spend money on logos, reserving urls (not a bad idea actually), business cards, designing hang tags, labels, trademarks and intellectual property right off the bat. $10,000 is a typical figure people have told me they spent. So here’s the beginning of our running cost tally:
Me: $20 -for urls
You: $10,000

The next step to building my future empire is so humble and boring that a beginner will completely miss the nuance of its significance and that is to find some fabric sources. I’m not going to drive myself crazy designing and then looking for a fabric that may not exist, is out of season, or for which there is limited or no continuity. Right there, I’ve avoided a production nightmare four months out because I’m not going to be caught not being able to make deliveries because my fabric source dried up. I also won’t be forced to make a last minute substitution on a fabric I don’t have time to test that may fail, burn my buyers with customer returns, and killing my business right out of the chute.

Once I have a range of fabric choices, I’ll determine a few options that fit my budget and will work with what I have in mind. Then I’ll order five to ten yards of each, confirm the continuity of goods, get order cut off dates for production yardage and file this information in my production management program StyleFile. At this point, my costs amount to my time and the cost of yardage. Let’s call it 10 different piece goods at five yards each at an average of $7.50 per yard or $375. Based on my experience though, most start ups will spend at least ten times that because they would have started on another tangent and have to come back to this after they’d blown money on patterns that will need to be redone. Believe me, saying only ten times more is erring very very generously in your favor!
Tally so far:
Me: $395
You: $13,750+

Before I can design stuff, I have to examine the fabrics to make a determination of their suitability and performance. I might decide I don’t like some of the stuff that comes in or that my customer won’t. I might not like it if it’s difficult to handle and sew, if it frays too easily, shrinks too much during pressing or it comes back from the dry cleaners looking like a hot mess. Speaking of, that’s the second thing you do -test your fabrics. However, since this is yet another boring thing most people won’t pay any attention to, my costs of eliminating the potential loss of fabrics amount to $10 a piece for dry cleaning and steaming ($100). Your costs if you don’t test can run into the thousands of dollars because you’d need to have your patterns remade for other fabrics if the goods fail to perform as you hoped. Taking a wild stab in the dark, let us say your cost is only fifty times what I’d pay. Here’s the running total so far:
Me: $495
You: $18,750

By the way, ask anyone who has been around, even by increasing your costs by a factor of ten to fifty, I’m being very generous and erring in your favor. If you have patterns made for fabrics you haven’t tested and then the garment is then processed and it shrinks like all get out or it completely changes the hang or the drape of it, your patterns must be remade. These days for a man’s sportcoat, including fitting and prototyping, you’re looking at development costs of <$1,000 each. Multiply that by two, only the first half went right into the trash. And that’s assuming you didn’t cut it all already, can’t buy more fabric, miss your contractor’s delivery date and of course, the date by which you told your customers you’d ship. Not to get all naggy on you or anything but my book has all this in there. It explains how to test your fabrics well before it represents a crisis. Such as in how to measure them etc.

Continuing on, the next step is to draw design sketches that are suitable for each fabric. Sounds easy, right? Maybe not. Just because you can draw something doesn’t mean it can be manufactured. This is good and bad. Bad because you don’t get what you want. Good because we’d have any number of scary hairy monsters running around, and unicorns and time machines would be ubiquitous. Seriously, if sketching isn’t your thing, you’ll have to hire someone to clean up your sketches. You need a technical illustrator, not your girlfriend or next door neighbor trying to break into fine art. On second thought, their sketches might be fine if they sew well. You need sketches that convey the technical attributes of garments and construction clearly so you can get a quote from a pattern maker. If you don’t, well, it’s just more delay, cost and hassle. Let’s tally up costs, again mine will be different. I can do my own but I will do it under duress because I detest it.
Me: $495 +beer and a lot of naughty words I’d never say around my mom.
You: $18,750 and …..

I don’t know what it will cost you if you don’t do sketches nor how much it will cost if you do. If you don’t do them, people just might get so frustrated with you that nobody will take the job so you’re in the hole by nearly $20,000. If you have a clear idea with photos (do see the technical illustrator link above), it might only cost $50 per sketch. You could also try doing it yourself. A lot of people do that but then they run into the problem of the sketches being not manufacture-able. A colleague of mine complained recently that they spend hours going over even prettily done Illustrator CAD sketches and they just can’t do it anymore. For the sake of moving on, let’s pretend your sketches are free.

Now you need to hire a pattern maker. Or, you can hire a package service (pt.2). I’ve written quite a bit about the varying costs of each option. If you’re short on cash, managing it yourself is the way to go. If you do that, your costs for prototyping a sportcoat to include pattern cutting and sewing a sample is about $1,000 each but you can certainly pay more, much more. For example, I know a pattern maker in NY/NJ who was charging $800 for a baby bloomer pattern (should cost $100 max) several years ago, I’m sure her prices have increased -but she’s just the nicest lady ever. She’ll send you nicely packaged Christian gifts, candles her mother made after you call her for a quote. You know you can trust her because there are bible verses all over her website. My point is, not knowing how to hire a pattern maker can cost you plenty, no matter how nice they are.

If you decide to take the cognitive shortcut of using a package service, the costs are going to be an order of magnitude higher. If you’re short on cash, doing it yourself is the best way. For the sake of simplicity, let’s assume you hire a good patternmaker who charges commensurate to industry standards (in other words, not like that lady in NJ/NY). Furthermore, you decide to proceed with 7 styles. My cost of pattern making will be “free” in a manner of speaking since that’s what I do. As a practical matter, it’s not because I have opportunity costs. If I’m working for me, I can’t pay my salary and overhead that I’d be earning with client’s projects. Alternatively, I can work nights and weekends and not have much of a family life -which is pretty much the story of your life by this time, correct? To be fair, let’s calculate my costs as half what yours would be, namely $500 per pattern and sample. Here’s our tally thus far:
Me: $495 + ($500 x 7) = $3,995
You: $18,750 + ($1,000 x 7) = $25,750

At this point it strikes me as tortuous to continue this line of inquiry because the situation won’t be improving any. You know the easiest way to save yourself a whole lot of money? It’s to read my book and do what it says. I can tell you with a high degree of confidence that I could get 50 units of each of those seven styles cut and sewn for about what you’ve spent so far. [amended 2/4/12: my cost is closer to $18,850 for fabric, cutting, sewing and finishing of 350 jackets.]

Sure there are key differences between you and me. I obviously know people you don’t and you probably know people I don’t. For example, I don’t know any powerful buyers like many of you say you do but I don’t need to. Not right now. However, I do know how to go about finding one when it’s time and I’m not going to worry about it until then.

The good news is you have the opportunity to know the very same people I do. The bad news is, nobody is going to hook you up just because you ask. However, like you, no one is going to give me a name either until I’ve proven I’m ready to take that step because everything is done by referral. My being ready in this case amounts to having samples ready and being sufficiently knowledgeable to start a wholesale relationship with buyers to include having production and fulfillment lined up. Once I have all that, I will ask for referrals in our member’s forum. And you know what? People will respond.

Whether you believe it or not, you have the opportunity to know the very same people I do, there’s no coincidence, luck or serendipity to it. If you prefer to decide to continue to hope you’ll meet the right person in an elevator versus moving decisively forward, that’s your choice. Becoming successful is not luck, it’s choice -and choice requires a decision.

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  1. Gisela says:

    wow! well said Kathleen! a nice refresher on why we bought the book and that is to take it’s advice and save ourselves allot of, time, money and heart ache and not to mention your reputation if you do things the wrong way. i needed to hear this once again, because i was about to do sketch’s without making sure the fabric was still available….again we can be stubborn or just flighty i don’t know…

  2. Jay Arbetman says:

    You said…….The next step to building my future empire is so humble and boring that a beginner will completely miss the nuance of its significance and that is to find some fabric sources. I’m not going to drive myself crazy designing and then looking for a fabric that may not exist, is out of season, or for which there is limited or no continuity. Right there, I’ve avoided a production nightmare four months out because I’m not going to be caught not being able to make deliveries because my fabric source dried up. I also won’t be forced to make a last minute substitution on a fabric I don’t have time to test that may fail, burn my buyers with customer returns, and killing my business right out of the chute.

    Hallelujah!! This happens to me (I sell fabric) every week if not every day.

    Kathleen is abiding by my advice to all start ups.

    1. Put your money in your pockets.
    2. Put your hands in your pockets.
    3. Don’t take your hands out of your pockets.

    If you want really specific fabric be prepared to move to Shanghai. While there are wonderful fabrics available to you, that availability is a closed set.

  3. Xochil says:

    Excellent post! It’s amazing what research, education, and learning from those who’ve been there can mean for your bottom line. It’s so “easy” to spend more money than necessary, simply by not following the right steps and not doing your homework. Mistakes like buying fabric at retail, having patterns done before you know what your fabric will be, changing the design 5x in the process because your sketch didn’t “work” in real life or wasn’t how you “envisioned” the design to be (like bad sketches that don’t include seams, sleeves with no armholes, not thinking about wear-ability such as closures, etc.).

  4. Jay Arbetman says:

    True Story.

    I have a buddy that started a jean company for $250.00 in the early 1980’s (that is what it cost him to import 60 jeans from Taiwan). He sold jeans out of his trunk, then his RV. Today, he is cruising in on about 12 million dollars.

  5. Colleen says:

    I think Xochil means that the sketch didn’t include an armhole, therefore was left for the patternmaker to decide. The design didn’t work because the designer envisioned a drop shoulder (but didn’t add to the sketch), but the patternmaker made a fitted shoulder. For example.

    Lately, I’ve begun to refer to myself as a Forensic Technical Designer. The sketches I receive are just one clue as to what the designer wants. In these situations, a poker face is priceless.

  6. Rena Fraser says:

    Excellent reading and as a newbie I really appreciate you taking the time to establish context.

    One question though; I checked the link to ‘StyleFile’ and the site is under construction. Is this a service/tool you or someone else is launching and when do we get to play with it?

  7. Xochil says:

    @ Alison – Yes, I’ve gotten sketches that show the outline of a garment, the body, and sleeves, but don’t show the line for the armhole. So, do you interpret that as a set in sleeve? A kimono sleeve? A raglan? Same thing with pants that don’t have a crotch seam drawn in. Obviously the drawing needs to be corrected and the proper information conveyed to the pattern maker before they can translate it into a pattern.

  8. Kathleen says:

    Rena: The software is not new by any means, I’ve been writing about it for awhile now. In this post I had mentioned the 30 day free trial period. Lorraine mentioned they would be reworking their site and at the same time, they moved their business and coupled with what they do full time (a pattern & sample service), I guess it’s taken longer than they thought it would to put it back up. Lorraine has given me some licenses to give away but I haven’t figured out how I am going to do it.

    Colleen: DH and I read your comment over lunch and bust a gut. Sometimes it’s less a forensic technical designer than secret agent tech designer -in that you’re trying to ferret out all the information you need from your customer who is doing their darnedest to keep it from you. ‘Cause you might steal their idea. Or something.

  9. Cary Pragdin says:

    Loved this post and comments. I have a suggestion for the software license giveaway: why not allocate one license per continent, since your readership is international? Then I’m in the running :-) Maybe those interested in the software could send you a motivational letter outlining their current operations, what software they are using now and what benefit they believe Stylefile could bring them. After using the software for a certain period they could then review it again and the reviews could be published here and on Stylefile’s website if they like. Judging by my knowledge of Stylefile so far, the reviews are going to be glowing! In fact, if I had their software, I would mention it on my website too.

  10. Seth Meyenirk-Griffin says:

    Jay: Hmmm. Sounds familiar (looking for stuff that may/may not exist). I give myself a break though, since I’ve realized that any work I do for other people is probably always going to be a hobby that I run at a loss rather than a viable business.

    That said, I really *do* like the wicking micro-pique and lightweight windstopper fleece, but the very narrow width of the ripstop cotton annoys me. (Great color selection though.) In retrospect, I should have gotten everything in black, since I prefer working monochromatically. …And if I’m making things because I *want* to, rather than because I have business pressures, why should I do them in anything other than the single color I like? :P

  11. azelle says:

    forensic technical designer…LOVE IT!!

    I am kind of confused by what you mean by ‘buying fabric from retail’ as a mistake. Yes, it is expensive but it seems like the only choice for someone doing the first round of production or sample-making!! Where are you supposed to go if you are just starting out and need fabric…? A lot of places you might meet at a trade show (where, by the way, I had to exert every ounce of hustle I had since I haven’t actually made anything to enter) have minimums that a little line to show to buyers won’t reach… Would love to hear where you guys are getting your fabric!!!

  12. Kathleen says:

    I can see you’re frustrated but retail is not the only choice for samples or the first production run.

    It is usually a question of knowing where to go and how to talk to a vendor once you find one. To the first part, I ask on the forum. Even with 30+ years in the business, it is the best source for me because people go out of business, new suppliers come online etc and there is no better way for me to keep up with the daily changes and vagaries of the business. With 1,000 members, we collectively know more than one person or a small group of people.

    To the second point, the shortest chapter in the book I wrote (listed in the right sidebar) is called how to buy wholesale fabrics. Or something like that. Of everything I’ve written in that book, I easily get the most feedback on that chapter. I can’t tell you how many times someone has said that their first call to a supplier went exactly like that script, verbatim.

  13. Derreck says:

    To think you can actually run a brand off 10K, even 20K is ridiculous. A decent website is going to cost you at least 2K. Nobody buys off Shopify or BigCartel sites no matter how good they market them to you. If you look like you don’t spend nobody will take you seriously.
    Retail buyers want lines with huge ranges. You need a large variety with full size runs. This costs money. You then need to have your next seasons line in production while this one is arriving. Now here comes your customs import fees that will be thousands after you’ve paid for all logistics. Now you need to market it. You need thousands of dollars to market and get your brand seen or pay a celebrity to wear it. If it were cheap and easy, everyone would be a designer. Using generic blanks and cheap materials is no good for a new image.
    There is ways around huge funding like company’s/brands who run programs to help new designers. Puff Daddy or P Diddy or whatever he is calling himself now owns a company that does this. The streetwear brand Kanati Co. also has a made on demand program that they do with Dr.Dre’s son or Dr.Dre owns it or something. Both of these company’s offer quality manufacturing and let brands offer retail ranges with small budgets. You also need to watch getting ripped off overseas with the little money you do have. Or getting overcharged by company’s here. If you’re doing it on your own. I’d put a figure of more like 100K to reasonably start.

  14. Kathleen says:

    Thanks for your comment Derreck. It is obvious to me that you have some experience in the trade and maybe it is only a matter of scale but I don’t completely agree with all of your points. Most importantly is the issue of huge ranges, large variety and with full size runs. Sure, people in hell want ice water but that doesn’t mean they’re going to get it. Nobody launches with a large line. Nobody, unless they’re a spin off from an existing brand, has the funding, experience, connections and personnel to manage the complexity of such a large project straight out of the chute.

    I also don’t agree that it is necessary (note I said “necessary”) to have one’s stuff on a celeb’s body in order to become successful.

    But yeah, you’re right; if it were cheap and easy, everybody would be a designer.

  15. Ammar says:

    Please help me on some good clothing makers that could make the designs of my line. I don’t mind paying if it’s not too outrageous. You said the pattern maker but didn’t say if using outside a u.s source to make the cloths was bad or not. Looking forward to hearing back from you, thank you

  16. Fatimah says:

    I am a new person to this. I am not a designer and I don’t know how to make sketches. All I know is how to dress up and look fab . I’m so passionate about fashion and clothes. And I know a lot of people have done it with out having these technical designing skills. And my dream is to start a women clothing line. I don’t know where to start and where can I find designers that can help get this started . Any help from you guys will be appreciated

  17. Jungie says:

    Good article. Were planning someday a small clothing line. Great favor for me like a pattern maker like me and skills with sewing for all type of machinery. I can make my own simple design. I like t-shirts and pants for women, men and baby as a small shop. Anyway thanks for this post, its valuable guide.

  18. Melissa says:

    This post brought up a lot of questions in my mind and I wasn’t sure to ask them here or your forum, but since the context is a post for the public that is where I will ask the questions, whether they are embarrassingly ignorant or not.

    You said that one should have both a company and brand name. Which one would be your url? In your book you said not to do a name with the word “sewing” in it, because you will be judged by it. This leads me to the question, “Which name would you do your business under in regards to contracting and sourcing?” The url name, the company name? I am uncertain as the the use of each.

    You also say that … I could get 50 units of each of those seven styles cut and sewn (350 jackets) for said price. By units, do you mean 50 of one pattern block in varying sizes and colorways or 50 of one pattern block singular size and colorway?

    Lastly, you said, “If you’re short on cash, managing it yourself is the way to go.” In what regards can a new DE expect to manage the very first sample pattern making that would save them money?

    Thank you very much for you needed insight.

    • kathleen says:

      I would get a url for each; it’s a small $10 annual investment. Otherwise, your question was discussed in depth in the forum, thank you for posting it.

      By units, do you mean 50 of one pattern block in varying sizes and colorways or 50 of one pattern block singular size and colorway?

      Truth be told, my response was a back of the envelope, estimate. Varying sizes, no problem provided the quantities are proportionate in that each style can be spread in one cut. If it can’t be, then the cutting would be charged separately.

      Colorways is another story. Presumably this would be for one but if there were more but colors were roughly complimentary in that a thread change was only needed for spot top stitching etc, then sure, no problem.

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