Why did I create this site for fashion retailers?

Fashion retail advertising marketing and sales for business

 

Hello, my name is Mark Fregnan. I work with fashion retailers everyday. So, why did I create this web site?

Simply due to the frustration I hear from clothing, footwear and jewellery retail shop owners. I’m sure you can relate to some of these challenges:

  • Flat out or dead quiet. You have some good days, but can’t figure out how to bring in more store traffic when you need it.
  • Having hundreds of thousands of dollars of capital tied up in stock.
  • Not moving forward. Annual sales which have reached a plateau or even declining.
  • Expensive advertising which is ineffective.
  • Increases in rent
  • Rising expenses
  • Staff problems
  • The economy

The list goes on…

But, generally most of those problems can be solved by INCREASING SALES of your fashion products whilst MAINTAINING GOOD MARGINS.

So What Are Successful FASHION RETAILERS Doing Now?

You see after many years of studying SUCCESSFUL FASHION RETAILERS and conducting intensive research and marketing analysis I discovered literally dozens of simple, yet powerful strategies TO INCREASE FASHION RETAIL SALES and PROFITS.

This information has been collated and edited into a very special mini-course called ‘Marketing Secrets of Top Fashion Retailers’. Here’s what you’ll learn…

  • Discover The Promotion That Brought In Additional Sales Of $53,858 To A Retail Store In 4 Hours!
  • How To Increase The Value Of Your Fashion Retail Business By At Least $45,000 In The Next Four Weeks! This Is So Easy – Every Retailer Should Be Doing It!
  • 3 Simple Steps That Were Taken By A Fashion Retailer That Increased Annual Sales By 126%!
  • How A 430% Increase In Advertising Response Was Achieved By A Local Business!
  • How To Add At Least $8,500 To Your Bottom Line In Your Fashion Retail Business By Avoiding This One Big Mistake!
  • The Quick & Easy Way To Ensure A Good Consistent Volume Of Sales Each & Every Month. Never, Ever Have A Bad Sales Month Again!
  • Revealed! How To Overcome Price Shoppers And Actually Enjoy 20% To 50% Higher Gross Margins Than Your Competitors!
  • Plus many more fashion marketing tips & tactics!

Excited? Well, you should be. It wasn’t easy creating such a valuable resource. All of the fashion marketing information in the ‘Marketing Secrets of Top Fashion Retailers’ mini-course has been tested in actual real-life businesses – no theory here.

So, how much is it?

We understand that many fashion retailers are experiencing 20% (or more) reduction in sales due to the current economic climate, so we have decided to hand you a ‘gift’. This mini-course sells for $167.00, but for a limited time, we have decided to make it FREE.

FREE – For a limited time… Request your Fashion Marketing mini-course now!

 FASHION RETAIL MARKETING INFORMATION…
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Marketing Secrets Of Top Fashion Retailers!

 

Free Mini-Course
FREE MINI-COURSE (Valued at $167)
   
Find out how to…
   
tick box Bring In More Customers To Your Fashion Retail Store!
tick box Increase Sales!
tick box Improve Customer Loyalty!

To receive your Fashion Marketing Mini-Course simply complete the form below and click the ‘FREE Instant Access’ button.

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27 Questions You Should Ask Before Buying A Fashion Retail Business

I met the husband and wife owners of a small retail shop recently. The business was running at a $65,000 (approx) annual loss. They had purchased the business over 12 months ago and had been steadily losing money. I looked briefly at their books and realised they had paid too much for the business. On top of that, both of them had no retail business experience and they had decided to cut out all of the advertising that the previous business owner had been running – due to cost reasons only.

I asked them how much research and due diligence had they conducted before buying the business. I was shocked by their response…

Don't sign to purchase a fashion retail store without doing your homework

"We asked the solicitor who was performing the business settlement service if the business was a good buy."

In otherwords, they asked after the sale… Talk about throwing money away. Needless to say, they no longer have any available capital to invest in marketing or anything else. The outcome will be to close up shop and accept the loss, and the lesson.

 

This is real important…

I’ve spoken to and met with many business owners who have paid too much for their business (and not just fashion retailers – all types of businesses). It’s like paying $100,000 extra for a house. The problem is that usually the extra capital has been borrowed which puts a strain on the business cashflow. Often it’s very difficult to recover from this situation.

To gain $100,000 in net profit in a fashion retail store may require at least an additional $800,000 in sales revenue (i.e. on a 12.5% net profit margin).

$800k in ‘additional’ (over and above existing) sales revenue which isn’t a very easy thing to achieve in a short-time frame, i.e. 12 months.

So how do you actually avoid this type of business disaster?

Do your homework – Ask yourself these questions…

1. What do I want from being in business?

  • Freedom to do ‘my’ thing?
  • Be an entrepreneur?
  • To make more money than being an employee?
  • Work fewer than 30 hours a week?

2. Why am I going into a fashion retail business?

  • For lifestyle (to work fewer than 40 hours per week, with the freedom to go on holidays whenever you choose)
  • To make a profit by building the business up (increasing sales) and then selling it.
  • To generate more cash-flow than than a 9-to-5 job.

If your reasons are not listed above (lifestyle or profit) – don’t buy the business. If you want to be involved in retailing out of interest and passion for fashion – honestly it’s much safer to be an employee.

3. What will be my exit strategy to get out of the business?

  • Sell the business for a profit
  • Sell the business to a major shareholder(s) and become a silent partner
  • Pass the business down to a family member
  • Franchise

4. What skills do I have that will make me successful in this business?

Please don’t think that all that is required to ‘improve’ the business is cosmetic – by changing fashion labels or re-designing the store interior. Unless the store has poor stock and an ugly showroom – these ‘improvements’ won’t double sales.

Only very good marketing, a good sales team and good systems will increase sales significantly. Sorry, I’ve seen many business owners take over an existing fashion retail store – changing labels and interior perhaps at best has increased sales by 30% initially and then nothing after that.

5. What skills will I have to “hire in”?

  • Sales staff/assistants
  • Bookkeeper
  • Fashion buyer/consultant
  • Sales trainer
  • Outsource marketing?

6. What monthly cash-flow do I need?

  • To pay myself a decent wage
  • To cover all the retail business expenses
  • To cover the repayments if I borrow to purchase the business
  • Additional business profit

7. How much working capital do I have access to?

Can I get an overdraft to cover seasonal buying?

8. Will this business suit me i.e. hours, type of operation?

To ask the vendor who is selling the business…

9. How long has the business been operating?

10. How long has the current owner had the business?

11. Why is the current owner selling?

  • Worn out from working long hours for little money?
  • Couldn’t make the business work (perhaps in it’s current location)?
  • Actual legitimate reasons such as retiring, moving to another state or country, or looking for another challenge in another business?

If it’s retiring – also be aware that may business owners in their 50/60s hang on to a unprofitable business (maybe paying themselves a very basic wage) because it was too difficult for them to have sold earlier and got a job.

12. What is the Cash flow and Profit (Gross and Net) for the business?

13. What is the business owner paying him/herself?

14. What do the last 3 years of financial accounts show?

15. How has the business been valued?

16. Who are the key customers, suppliers, staff?

17. What are the terms and length of any leases?

18. Will the current owner stay on and assist for a period of time?

Ask them to put this period in WRITING!

19. What areas of the fashion retail business are systemised?

For example:

  • Point-of-sale (POS)
  • Bookkeeping
  • Marketing / customer marketing systems
  • Website / social media (e.g. Facebook)
  • E-commerce website

20. Is there a business plan?

21. How many hours a week does the current owner work in the business?

22. When was the last time the current owner took a holiday?

23. What is the marketing systems like? Do they make money for the business?

Review all advertising material, the customer database, the POS systems, any loyalty programs, special promotional material, etc.

24. What facts support the "story" of the business?

25. How secure is future income i.e. contracts with customers and suppliers?

26. How dependent is the business on the current owner?

27. What will it take to grow the business so I can sell it for a profit?

Fashion stock

Often this is the BIG ONE – many fashion retailers overcapitalise in stock in relation to the store sales annual turnover. Ask your accountant is there is too much capital tied up in stock on the balance sheet. If there is – don’t buy the business!!! Tell the vendor. You can either wait until they sell down the surplus stock at regular prices, or they can offload it at cost. Don’t let their past buying decisions become your problem!

Before you make an offer

1. Get your accountant to check the financial accounts

Obtain actual lodged tax returns with the government, not the business owner’s printout or handwritten bookkeeping summary.

Your accountant will ensure that the business has cashflow and is not over-capalised.

2. Hire a solicitor who is experienced in buying fashion retail businesses like the one you are looking at.

Your solicitor will ensure that the contracts with suppliers, the landlord, etc don’t have any surprises.

3. If you are spending over $250,000 on the business, or even if you want to be extra careful, pay for a business valuation.

Pay a licenced valuer to come in and audit the business. Even if you have to spend $7,000 for the valuation, it’s still much better than paying $50,000, $100,000 or more than you should have to buy the business.

You may even be able to ‘use’ the valuation to negotiate a better price.

The lesson

Homework always pays off in business. Sure, there is a lot of questions (above) – but, like with real-estate, the profit often is made when you buy the business, not when you sell. Taking shortcuts and buying a business on emotion often lead to regrets. Don’t let this happen to you.