WOMEN'S CLOTHING RETAILER No. 300 May 2007
Introduction
This profile provides practical guidance on setting up a women's clothing shop, supported by online sales or a mail-order catalogue. Training, start up costs and consumer legislation are considered, along with promotion, potential competitors, and sources of further information. Women's clothing retailers range from those selling second-hand clothing, to high street retailers selling mainstream fashion, as well as high fashion outlets selling one-off designs. They may specialise in vintage clothing or eveningwear, or may sell clothing for all occasions and ages. Many also sell lingerie and hosiery, jewellery, accessories such as handbags and hats, or shoes. Some also offer dress and hat hire for formal occasions. The women's clothing sector is dominated by high street chains, but there is sustained demand for independent boutiques offering tailormade or designer clothing, appealing to affluent professionals seeking high quality and individuality. There are also opportunities for niches such as plus-size, Goth, ethnic and maternity clothing.
Price £5.99 (Including VAT)
What formal training do you need?
No formal qualifications are required to start up this type of business, but there are several courses that might prove useful. A number of bodies organise S/NVQs for beginners and those with some experience (see www.city-and-guilds.co.uk and www.accreditedqualifications.org.uk). The S/NVQ in Bookkeeping and Accounts takes a basic approach to business administration. The S/NVQ in Business Start Up covers business proposals and planning. Relevant retail qualifications include: •
Are you suited to this type of business?
The impression you wish to convey should be reflected throughout your shop or website so customers can identify immediately whether your products are suitable for them. You will need creativity, an eye for detail and colour, and ideally some knowledge of window design and dressing, and in-store displays.
Customer service skills are essential, and you should be able to deal with complaints and returns politely and professionally. One of your best selling points will be a friendly, helpful service, which will distinguish you from larger competitors. A willingness to keep track of market changes throughout the year is crucial. You should be aware of seasonality and when new stock will be available. You should pay close attention to fashion magazines and events like the twice-yearly London Fashion Week (www.londonfashionweek.co.uk).
You need to be able to manage your stock levels according to the season. Controlling stock ensures you have enough popular lines during the busiest periods, but don't have too much unsold stock when trade slackens or fashions change.
If you source stock from abroad, you will need to deal with paperwork, suppliers, import regulations and deliveries. UK Fashion Exports (www.5portlandplace.org.uk) can offer advice on these issues. You should also be aware of tariffs associated with importing goods to the UK. See the Department for Business, Enterprise and Regulatory Reform's (BERR) website at www.berr.gov.uk/europeandtrade/ importing-into-uk/import-tariffs/page11291.html for more details. If you are selling online and running an e-commerce website, you will need to be well organised when processing and packing orders, as well as dealing with customer queries. Some knowledge of bookkeeping and accounts will be necessary for the financial side of the business, including calculating stock levels, working out profit margins and negotiating prices.
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The City and Guilds Higher Professional Diploma in Retail Management is ideal for those running a shop, and covers consumer behaviour and customer service, technology used in shops and marketing. The Retail Academy offers a Certificate in Retail Principles, which includes seven different qualifications covering visual merchandising, security in a retail environment, serving customers in a retail environment, product range planning, marketing, legislation for the retail environment and monitor retail operations. See www.retailacademy.org/minisite/ retailcert for further details. The London College of Fashion offers short courses, including Starting a Retail Fashion Business, Marketing Fashion for the Small Business and Online Selling. See www.fashion.arts.ac.uk/shortcourses/LCF_shortcourses_ business_start_ups.htm for further details.
If you intend to employ staff, consider courses offered by the conciliation service Acas covering issues such as employment contracts, terms and conditions, and employment law. See www.acas.org.uk/emsobs/acas_events_new.asp to view courses in your area. Acas also offers several courses that can be studied online - see www.acas.org.uk/elearning to register for its e-learning facility. If you are selling online, you may wish to undertake some IT training. Contact your local college of further education or adult education centre, or see www.learndirect-business.co.uk to find relevant courses.
Who are your customers likely to be?
Clothing is one of the most highly developed of all retail sectors, and women's clothing accounts for the most sales within the clothing sector. The best way to attract customers as an independent is to specialise in a niche market, or to offer additional services not available in chains. Potential customers include: Fashion-conscious 18-30 year olds who appreciate unusual designs and labels. Word-of-mouth may spread your reputation and attract new customers. Older customers. Women aged 30 and up represent an affluent and discerning market. Many appreciate shops with personal service and you should match that with high-quality clothes attractively displayed. Page 1 of 4
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The maternity clothing market. This is a sizeable niche, with pregnant women requiring casual, work and occasion clothing. The first-time mother is often now more mature and has more disposable income. You could also sell nearly-new clothes or have a hire service, as women can be reluctant to spend a lot on clothes that will only be worn for a short period. Customers who don't fit into standard high street sizes. The market for plus-size clothing is growing. Almost one in five British women are size 18 or above, according to Mintel, which also reported that £2.3 billion was spent on plus-size clothing in 2005, representing 17% of the UK women's wear market. Women seeking special occasion wear. Clothes for weddings, balls and other parties are premium items, with a slower turnover but good profit margins. Women seeking ethnic clothing such as saris, both for everyday wear and special events. The large market for ethnic clothing is often overlooked by the multiples. You should decide which fashions to specialise in and be aware of import regulations. Ecologically aware customers who are keen to source clothing produced by ethical suppliers. Fair Trade and even organically produced clothing is a growing niche market. Women are increasingly interested in where items come from, and will pay more for clothing that can prove its provenance. Cash-rich, time-poor women keen to order clothing online. Selling clothes to women via the web is a growth market, with research from Nielsen/NetRatings (www.nielsennetratings.com) suggesting that women are more likely to purchase goods online than men.
You can find out about specific competitors locally via the Yellow Pages (www.yell.com) or Thomson directories (www.thomsonlocal.com).
What are the key issues affecting the market?
Large retailers generally believe the traditional seasonal fashion cycle has broken down over recent years, as purchasing managers and manufacturers respond more quickly to changing demand. This is demonstrated by the ability of Primark and ASDA's George label to change ranges every few weeks. The fashion sector has come under the media spotlight for not recognising that the size of the models it uses does not reflect modern British women and their body shapes. Retailer ASDA faced heavy criticism from health professionals after it announced it would stock size 0/UK size 4 clothing in a mainstream collection. Globalisation and low costs in developing countries have driven the manufacture of much of the clothing formerly made in the UK to overseas suppliers. China is now one of the key exporters of clothes to the UK, along with Hong Kong, India, Bangladesh, Turkey, Greece and Portugal. Branding and marketing are vital as fashion businesses try to predict and influence consumer demand. Branding is also used to encourage customer loyalty, and large retailers use this to their advantage.
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Who will you be competing against?
Your competitors will be any other retailers offering women's clothing ranges, whether they are independents, small chains like Browns (www.brownsfashion.com), larger chains like Monsoon (www.monsoon.co.uk), or the likes of Marks & Spencer (www.marksandspencer.com), which has considerable buying power, and can react quickly to trends and purchase in bulk. Larger stores have the space and resources to offer extensive choice, and can offer low prices.
You should be aware of the 'Primark effect'. Primark (www.primark.co.uk) and other budget fashion chains like Peacocks (www.peacocks.co.uk), which have a fast turnover of cheap items, are the real growth area of the fashion world. The stigma of buying clothes from supermarkets has also disappeared and many women now buy clothing with their groceries.
Other small retailers and boutiques in your area may represent competition with specific brands and labels. However, many clothing shops find it beneficial to locate in clusters away from the high street. In some cases co-operation can result in greater customer numbers. The eBay site (www.ebay.co.uk) now offers goods from hundreds of niche online shops, selling new and vintage items. Spin-off site eBay Express (www.express.ebay.co.uk), which only offers new 'buy it now' options, is another source of competition.
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How can you promote this enterprise?
Location is crucial in the success of any traditional high street shop. You should consider the volume of passing trade, known as the 'pavement count', as well as the location of nearby competitors and large stores. However, it may be worthwhile setting up near related shops appealing to your clientele. You should also consider your customers' requirements. If you are selling maternity clothing, for example, customers should not have to walk far from their car or the nearest public transport interchange. Some promotional methods might include the following: The appearance of your shop will be important as fashion is all about image. Think about how you display your goods, whether you play music, how to arrange your lighting, and how the décor will affect the atmosphere. You should change your window display frequently to draw in passing trade. Seasonal sales are a good way of getting rid of old stock. Prominently displayed posters attract bargain hunters, who may become regular customers. Fashion shows of new season stock or for charity are good promotional tools. You should send press releases to your local newspaper about such events. See www.pressrelease-writing.com for tips on writing press releases. A series of regular advertisements in local newspapers or magazines may also produce good results. You should research readership and circulation before choosing the most suitable forum. See www.mediauk.com for potential outlets. Consider selling by catalogue in addition to a website. A printed catalogue demands investment in a permanent stock, but may appeal to older customers or those in rural areas. If you are selling online, you should update your virtual 'shop front' frequently so visitors are encouraged to return to your website to check what's new. Also consider simple ways to keep your site looking fresh, such as blogs and news items. Generic advertising in Yellow Pages and Thomson Directories is also useful (see www.yelldirect.com or www.thomsonlocal.com for details about advertising in their online equivalents). Page 2 of 4
There is a growing trend to swap items of clothing, both between friends at informal swapping parties, and via dedicated swapping services. Websites like www.clothes2swap.com provide a forum for people who wish to exchange unwanted clothing online. Swapping and loaning is also popular among pregnant friends. Antenatal groups often run informal maternity clothing swaps - see www.nct.org.uk for details. Online retailers such as Blooming Marvellous (www.bloomingmarvellous.co.uk) also command a high proportion of the maternity clothing market. If you are running an e-commerce site you will face rivals selling similar clothing online. Overseas retailers also target UK online shoppers.
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What start up costs can you expect?
Your principal start up cost will be your premises, the cost of which will depend on their size and location. A number of factors will affect the cost of your rent, including passing trade, proximity to parking or public transport, other shops nearby attracting potential customers, and the level of business rates. You will need storage space, display rails, shelves, chairs, mirrors and changing facilities. Many of these can be bought second-hand, but be cautious of cheap-looking fixtures as this will affect the image you are trying to project. You will need to buy stock outright in many cases, as suppliers may refuse to give credit to a new business. You will need a till - from £150 for a basic standalone machine to £2,000 for an electronic point of sale (EPOS) system and software, which records every item that is sold and calculates what stock is left. You can hire a chip and PIN machine from your bank for about £15 per month. If you plan to sell goods online, you will need to set up an e-commerce website. Basic online shops, hosted by third parties or by your Internet Service Provider (ISP), can be very economical. Costs to build the site will vary, but you can expect to pay a professional web designer at least £150 for the initial design and will then need to take into account support charges and maintenance.
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The Price Marking Order 2004 places a duty on retailers to ensure prices are unambiguous, identifiable and legible. The Sunday Trading Act 1994 restricts shops with a floor area over 280 sq m or 3,000 sq ft to opening for six continuous hours only on Sundays, between 10am and 6pm. In Scotland, see the Sunday Working (Scotland) Act 2003. Under the terms of the Consumer Transactions (Restrictions on Statements) Order 1976, misleading notices such as 'No refunds' are prohibited.
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See www.tradingstandards.gov.uk for further details of relevant trading legislation. Products sold online are covered by various regulations, including the Consumer Protection (Distance Selling) Regulations 2000 and the Electronic Commerce (EC Directive) Regulations 2002. Consumers must receive clear information about the goods offered for sale, and must receive confirmation of their purchases. Information, such as business particulars, returns policies and pricing information, must be specified on your website. See the Trading Standards leaflet at www.tradingstandards.gov.uk/cgi-bin/bglitem.cgi?file=BADV0651011.txt for details. The Data Protection Act 1998 is relevant if you plan to keep customer details on a database for a mailing list or newsletter. See www.ico.gov.uk for details. You should be aware of the Disability Discrimination Act 1995 which gives disabled individuals rights of access when purchasing goods and services. Businesses have to make reasonable adjustments to their premises to minimise barriers to access by customers with disabilities. See www.direct.gov.uk/en/DisabledPeople/index.htm, www.equalityhumanrights.com/en/forbusinessesandorganisation/ serviceproviders and www.equalityhumanrights.com/en/ forbusinessesandorganisation/employers for further guidance. If you are employing staff, you must ensure they are paid the National Minimum Wage (NMW). See www.berr.gov.uk/employment/pay/ national-minimum-wage for full details. Finally, you must be aware of health and safety legislation, including the: • • Health and Safety at Work etc. Act 1974. Management of Health and Safety at Work Regulations 1999.
The price of producing a mail order catalogue will vary depending on the size, the paper stock you use, whether you take a DIY approach or employ a commercial printer to publish it. Contact local printers for quotes or search the web. Firms offering this service include www.trade-print.com/brochures.html, www.printprice.net and www.printhouse.co.uk. A computer (from £400), printer and accountancy software to deal with business administration will also be required.
You may consider investing in CCTV and a security tagging system. Adequate insurance is also essential; you need public liability cover, protection for your building and its contents, and if you hire staff, you need employers' liability insurance.
What are the legal issues to consider?
This section is intended as a starting point only. You should seek professional advice before making any business decisions that may have legal implications. A range of regulations regulate the sale of clothing, including: •
The Textile Products (Indications of Fibre Content) Regulations 1986, as amended in 1994, govern the labelling of products containing textile fibres. It is an offence to supply textile products which do not comply with this legislation. Any footwear sold in England, Wales, and Northern Ireland must comply with the Footwear (Indication of Composition) Labelling Regulations 1995.
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See www.hse.gov.uk for more information. Further information on relevant legislation is available from the: Office of Public Sector Information - www.opsi.gov.uk. Scottish Executive - www.scotland.gov.uk. Welsh Assembly Government - www.wales.gov.uk. Northern Ireland Executive - www.northernireland.gov.uk.
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You will also be subject to the following: • • • The Trade Descriptions Act 1968 prohibits a business from advertising a product it cannot supply. The Supply of Goods and Services Act 1982 ensures goods and services are priced correctly. The Consumer Protection Act 1987 prohibits the supply of goods if they are unsafe. In the case of imported products, or those for which the supplier is unable to identify a source, the importer or supplier is liable for any damages. The General Product Safety Regulations 2005 require products to comply with the health and safety requirements of UK law.
Further information
For practical start up and small business tips, ideas, know-how and news, go to: Website: www.enterprisequest.com To access hundreds of practical factsheets, market reports and small business guides, go to: Website: www.scavenger.net UK Market Synopsis 41 Clothing and Fashion BOP 3 Fashion Designer BOP 106 Jewellery Retailer BOP 107 Dressmaker Page 3 of 4
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WOMEN'S CLOTHING RETAILER No. 300
May 2007
BOP 109 BOP 139 BOP 180 BOP 200 BOP 272 BOP 344 BOP 421 BOP 441 BOP 524
Fashion Accessories Retailer Dress and Suit Hire Handbag and Travel Accessories Retailer Wedding Dress Shop Designer Clothing Retailer Lingerie Retailer Personal Shopper Men's Fashion Retailer Children's Clothing Shop
Fashion Capital is a UK fashion portal and provides information on news, trends and suppliers. Website: www.fashioncapital.co.uk Fashion United provides news and information for the fashion industry. Website: www.fashionunited.co.uk
'Drapers' This is the weekly magazine for the fashion business, and includes news, features and events listings. Website: www.drapersonline.com The British Fashion Council organises events such as London Fashion Week and promotes the British fashion industry. 5 Portland Place London W1B 1PW Tel: (020) 7636 7788 Website: www.londonfashionweek.co.uk/content.asp?CategoryID =968&CategoryTypeID=2
The Association of Suppliers to the British Clothing Industry (ASBCI) brings together the clothing industry from all sectors of the supply chain - from fibre manufacture through to garment manufacture, distribution, retail and aftercare - and provides a platform for exchange of ideas and knowledge. Unit 5 25 Square Road Halifax HX1 1QG Tel: (01422) 354666 Website: www.asbci.co.uk
The British Shops and Stores Association (BSSA) is a trade association for non-food retailers. It features news and information on the retail industry along with guidance on chip and PIN, current legislation and training. Middleton House 2 Main Road Middleton Cheney Banbury OX17 2TN Tel: (01295) 712277 Website: www.british-shops.co.uk
The UK Fashion Exports trade association offers practical help to British-based designers and manufacturers intending to sell abroad. 5 Portland Place London W1B 1PW Tel: (020) 7636 5577 Website: www.5portlandplace.org.uk
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© Cobweb Information
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The Interactive Media In Retail Group (IMRG) aims to promote and encourage e-retail including via the Internet, telephone and through home shopping. 88 Kingsway London WC2B 6AA Tel: 07000 464674 Website: www.imrg.org
CONTACT-
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This information is meant as a starting point only. Whilst all reasonable efforts have been made, the publisher makes no warranties that the information is accurate and up-to-date and will not be responsible for any errors or omissions in the information nor any consequences of any errors or omissions. Professional advice should be sought where appropriate.
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WOMEN'S CLOTHING RETAILER
No. 300
May 2007