I can’t stress how important it is that you must have strong management of your business finances if you hope to have brand longevity. Unfortunately, many designers and fashion business owners don’t always make this a priority. However, if you aren’t careful, you could find yourself pulling the plug on your brand. Check out 3 simple tips below to "keep you in the black”:
BE AWARE OF HOW MUCH YOU’RE SPENDING & WHERE
Yes, your weekly petty cash for your daily trips to the Starbucks for that latte and breakfast panini begin to add up really quickly. I remember my former habit. I visited so much they gave me a gold card. Then, I took a look at my transactions and quickly realized that in 1 month, I spent $100 bucks. Case in point, you don’t want to waste funds in the early stages of your business on trivial luxuries.
ASK YOURSELF, DO I REALLY NEED IT?
Many times you can be tempted to buy things you don’t need at the moment, like that new serger or dress form. Even though you might need these things, do they need to be brand new or can you purchase them second hand. Remember, focus on the necessities that you will need in order to get your company up and running.
KNOW HOW TO PRICE YOUR GOODS FOR MAXIMUM PROFIT
This is the biggest killer of brands, not pricing your goods accurately! When pricing your goods, you have to take over all areas of your finances into account.The best formula is a three part process, how much do you want to make, what are your business expenses, what are your personal expenses? After you pay your business related expenses & taxes, the remaining will be your profit. Know the difference between gross and net, gross is all of the money you earn, net is what is left over after business expenses and taxes. Your company expenses typically include overhead such as workspace, electricity, equipment e.g (sewing machine, Macbook pro), things you are using to get your work done.
Do you need a tool to help you manage your business finances? Download my Financial Kit. Does your brand need help to get off the ground or are you stuck with the next steps on how to advance your start-up? Find out how I can help you here. In the meantime, follow me on Instagram, Facebook, Pinterest, Twitter & Quora