Original article published on Barclaycard Business:
Fashion retail is a difficult beast to tame. When what will or won’t sell can change in the swish of a party dress, how do you turn on your heel while keeping the stability that a small business needs?
We spoke to two small businesses to find out how they keep their fingers on the pulse and the purse strings.
Leave some wiggle room
Building spontaneity into the plan means actually putting it into the plan.
“About 30% of our budget is held back for quick response,” says Abid Ahmed, director of fashion retailer Celuu. “We have to balance our season but leave space to react. And we have to make sure we do react.”
Depending on your business, that might be buying in-season in response to a trend, or placing production orders late in the day with a supplier that can deliver quickly. The key thing is keeping some powder dry until you know what’s hot and what’s not.
Of course, as a small business it’s not always easy to keep some money to one side. That’s where being clever with cash flow can help.
“ Credit cards give you between 31 and 56 days interest-free if you pay the balance in full by the due date each month,” says Angel Serrano, Director, Small Business Product at Barclaycard. “People don’t use this properly. Take advantage of having more flexibility in your cash flow, it’s a very simple way of making the most of credit cards.”
Work it baby
Extending your reach means you can be more spontaneous in the way you market your products. Adding additional options for both marketing and payments into your business can help you achieve it.
Is a hot celeb wearing a jacket that looks like one of yours, or do you have a pair of shoes that look like they’ve walked to your store straight from the red carpet? Make the most of it with reactive messaging, and if you can direct people to somewhere they can make payments online then even better.
“If you have e-commerce you can give people the full journey when you’re promoting on social media,” says Caroline Fletcher, owner of Weave Womenswear.
An online store lets your customers be spontaneous too. They can get their fashion fix 24/7 and you can move stock more quickly. And when designing it, think about how your customers will access the site. Are they more likely to be chained to a computer or glued to their smartphones?
Don’t be a fashion victim
Make sure some solid business practices underpin the calculated fashion bets you make. Abid says that successfully mixing stability with spontaneity means making the fashion trends relevant to the people coming through your door.
“You need a good team that knows what they are doing and what they are backing, but that then ties it all up commercially too,” he says.
You can also create flexibility by setting up your business processes as leanly as possible. Tight lead times mean you can be more reactive to trends.
“Commit late, and give yourself as much room to move as possible,” says Abid.
But nobody gets it right all the time. If you’re late to a trend or misjudge the mood, make sure you have a plan in place to recover quickly.
“One way is to send out emails explaining how to wear those trends, and give them a different angle,” says Caroline. “Or you can try to broaden the market you’re selling to, promoting to a wider audience on social media.”
Take the show on the road
Having mobile payment solutions within the business gives you the chance to add spontaneity to your retail options.
Being able to get out there means you can capitalise if you spot a local event that will draw the kind of crowd that would love your style. Building that capability into your payment systems is simple.
“I don’t use a till, I have an iPad,” says Caroline. “I use a card reader and an app . It means you’re mobile, and it gives you so much flexibility to get out there and have a pop-up wherever you want.”
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Please note that the views expressed in this article are personal opinions. Barclaycard cannot accept any responsibility or liability for reliance by any person on this article or any of the information set out in it.