Start a fashion consulting business by following these 10 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your fashion consulting business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
Check out our How to Start a Business page.
STEP 1: Plan your business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How much can you charge customers?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a fashion consulting business?
The costs to open a fashion consultant business are extremely low. You can effectively start from home, and there are no formal education or certification requirements. Ultimately, you could open the business for $2,000 or less. This assumes $500 for a professionally-designed website and $1,500 split across advertising via traditional media channels such as newspapers and radio. Use some of your money to print out high-quality brochures to advertise your business. Your job is very image-oriented, so most of the ongoing marketing will be via your web page as well as social media pages that you can set up via Instagram, Facebook, and so on.
What are the ongoing expenses for a fashion consulting business?
Perhaps the greatest asset of a home-based fashion consulting business is that there are only few ongoing expenses. You will have to pay gas to travel to clients, and pay for the hosting of your website ($100 or less per year). You may also decide to print new brochures from time to time. However, you have no monthly lease to pay, no utilities to worry about, and virtually no overhead at all, which helps you maximize your profits.
Who is the target market?
Typically, your best customers will be young, well-heeled adults. They will have enough money to pursue a really fashionable lifestyle (and to hire you), but are young enough (in both age and their careers) to consider their appearance a major component of their success.
How does a fashion consulting business make money?
A fashion consultant typically makes money by charging an hourly fee for their consulting services. You may consider charging different hourly fees for different services as well as one-time fees for other services (such as reviewing the client's existing wardrobe).
How much can you charge customers?
How much you can charge may vary greatly based on your experience and location. Typically, a consultant will charge between $35 to $50 an hour for their services, though veteran consultants in pricier areas such as New York City may charge as high as $150. You may also consider offering different prices for things like a wardrobe consultation ($100 or more for what may be a multi-hour process) or combination packages that bundle that consultation with an outfit and shopping planning session (between $126 and $180—basically, offering a ten percent discount).
How much profit can a fashion consulting business make?
The exact amount of profit you make is determined by your pricing and your number of clients. The national average for such a business is about $53,000, but it is possible to make much more than this by having a steady stream of clients. As mentioned before, it is also very possible to start this as a side business to build up your reputation before making it your main business, which will certainly lead to a more robust profit in your first full-time year.
How can you make your business more profitable?
Consider embracing multiple aspects of image consulting. For instance, being able to offer tips on makeup and hair as well as outfits helps to really set you apart. Consider creating monthly consultation packages that are competitive, encouraging customers to keep you as a consultant for longer stretches of time. Finally, make sure to get client testimonials and, with their consent, pictures for your brochures, website, and social media. Some of your best customers will be young adults, and their reliance on customer testimony is legendary.
What will you name your business?
Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Fashion Consulting Business Name Generator
When registering a business name, we recommend researching your business name by checking:
- Your state's business records
- Federal and state trademark records
- Social media platforms
- Web domain availability.
It's very important to secure your domain name before someone else does.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your fashion consulting business is sued.
Form Your LLC
Read our Guide to Form Your Own LLC
Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services. You can choose to hire a registered agent or act as your own.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
Small Business Taxes
Depending on which business structure you choose, you might have different options for how your business will be taxed. For example, some LLCs could benefit from being taxed as an S corporation (S corp).
You can learn more about small business taxes in these guides:
There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Additionally, learning how to build business credit can help you get credit cards and other financing in your business's name (instead of yours), better interest rates, higher lines of credit, and more.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Recommended: Read our Best Banks for Small Business review to find the best national bank, credit union, business-loan friendly banks, one with many brick-and-mortar locations, and more.
Open net-30 accounts
When it comes to establishing your business credit, net-30 vendors are considered the way to go. The term "net-30," which is popular among vendors, refers to a business credit arrangement where the company pays the vendor within 30 days of receiving goods or services.
Net-30 credit terms are often used for businesses that need to obtain inventory quickly but do not have the cash on hand.
Besides establishing business relationships with vendors, net-30 credit accounts get reported to the major business credit bureaus (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how businesses build business credit so they can qualify for credit cards and other lines of credit.
Recommended: Read our guide on the best net-30 vendors so you can start building business credit now, so you never have to worry about cash flow in the future. Keep in mind that poor cash flow is the #1 reason businesses fail!
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
In most states, it is necessary to obtain a fashion consulting license. Certain state permits and licenses may be needed to operate a fashion consulting business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
For information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Certificate of Occupancy
A fashion consulting business can be run out of an office. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a fashion consulting business.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your fashion consulting business will be in compliance and able to obtain a CO.
Fashion consulting businesses should require clients to sign a services agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and intellectual property ownership. Here is an example of one such services agreement.
STEP 7: Get business insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners, we'll give you helpful tips and advice for creating the best unique logo for your business.
How to promote & market a fashion consulting business
In addition to advertising, brochures, and your online presence, consider offering free mini-consultations at places like colleges and universities. Consider striking deals with local retailers where you can serve as a consultant for their customers and get a commission based on the items you help sell. Finally, in addition to your typical price structure, consider offering a lower-cost closet consultation where clients can get recommendations based on what they already own.
How to keep customers coming back
Customer attraction for this job is primarily comprised of the savvy self-marketing mentioned above. Customer retention, meanwhile, comes mostly via client conversations. You should develop a sense of rapport with customers, and use your conversations to find out about their recent successes with careers, romance, and so on. When customers believe that your advice about their image is helping them achieve success and happiness, they will naturally want to retain your services.
Still unsure about what kind of business you want to start? Check out the latest Small Business Trends to help inspire you.
STEP 9: Create your business website
After defining your brand and creating your logo the next step is to create a website for your business.
While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.
Here are the main reasons why you shouldn’t delay building your website:
- All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
- Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
- Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.
Using our website building guides, the process will be simple and painless and shouldn’t take you any longer than 2-3 hours to complete.
STEP 10: Set up your business phone system
Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.
There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use.
Recommended: Find the best phone system for your business; check out our review of the Best Business Phone Systems 2021.
Start A Fashion Consulting Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
Obviously, this business is ideal for fashionable people. If you regularly keep up with the latest trends, fashions, and styles, this job is ideal for you. It can also be good for those with previous backgrounds in things like the fashion retail industry, as this gives you the experience to find the best deals for your clients.
Want to know if you are cut out to be an entrepreneur?
Take our Entrepreneurship Quiz to find out!
What happens during a typical day at a fashion consulting business?
A typical day for a fashion consultant involves communicating with and meeting with current clients. During these meetings, the consultant makes recommendations concerning client image and may also help show the client places to purchase certain items or brands. When not communicating or meeting with clients, you will be generating and following leads for potential clients as well as researching both current trends and the best places to obtain them.
What are some skills and experiences that will help you build a successful fashion consulting business?
It's time-consuming and expensive, but getting a formal degree in Fashion can be a major help. Additionally, intimate familiarity with the various boutiques of your areas can help you steer clients towards places and styles they have never encountered. A network of contacts in fashion retail stores will also help, both in identifying major deals and upcoming styles as well as possibly working out a deal for customer referrals with the store.
What is the growth potential for a fashion consulting business?
This job has modest growth potential: the Bureau of Labor Statistics estimates that the retail industry, including fashion, will grow by about seven percent between 2014 and 2024. As the fashion industry flourishes, fashion consultants will become more in-demand.
TRUiC's YouTube Channel
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Learn from other business owners
Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a fashion consulting business?
Spend time researching what the latest fashions and trends are and make sure your own appearance shows that you are stylish and chic. Proactively reach out to non-traditional clients to boost your business—for instance, private and public schools may want a consultant regarding school uniforms. Be sure to network with people such as wedding consultants and event planners from whom you may get some client recommendations. Finally, consider printing high-quality brochures that you can send to clients in order to pique their interests.
How and when to build a team
Most consultants start out on their own. However, once you have a strong network of ongoing clients, it may be time to branch out and build a team so that your brand can continue to provide individualized assistance.