Start a fashion consulting business by following these 9 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.
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 long it will take you to break even?
- 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 very important. Read our detailed guide on how to name your business. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your fashion consulting business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
Form Your LLC
Read our Guide to Form Your Own LLC
Check out the Top Business Formation Services from our friends at StartupSavant.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
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?.
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.
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: Find the right bank for you, read our review of the Top 5 Banks for Your Small Business
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.
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.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
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.
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.
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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.
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.