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Hi Aissam, you have some great questions. Here is our take on them:
2. It all starts with how much research you have done in your market before launching. Do you have a rough idea about if actual customers want to buy your products? It is a gamble in the beginning and no one can actually know numbers before the launch. it is way easier to calculate and estimate when you have actual numbers and data to back the purchasing up. Here it’s vital to have a good collaboration with you manufacturer and prepare them for a quick reorder if you see things flying out of the shop.
if you see some items moving a bit slower there are things you can try:
– bundle products and offer a bundle deal
– market the hell of that item, and put it in all your pictures and marketing. people buy what they see. get influencers to promote that item to give it an extra push
– market the item as special, limited edition. some people want what exclusive products that not many other people have.
– putting it on sale should be your absolute last stop….3. Since you will have online direct to consumer business model to start off, I assume you will buy all your products and the first collection in one go, to be delivered to your warehouse at the same time. after that it all depends on your strategy and business model: will you add new products evenly through the year? will you have new drops every month or every other month? This is directly related to your budget and cash flow. if you have planned for this then introducing new styles pretty regularly is a good thing. Some brands introduce a new style once a week and some once a month. Buying lower quantities before you can see the data could be a good thing. Later when you have more accurate numbers you can have a more accurate buying order flow throughout your purchasing year.
As a D2C business, you want to train your customers to regularly come back to your site. When they come regularly to your site there should be new and exciting things for them to see and be able to buy. Even if you have e.g. produced a t-shirt in 4 different colors, you might want to wait with introducing one color till after a while, to have newness on the site. Again, there is no recipe, all businesses and brands are different and it’s all depending on your strategy, planned cash flow and business model.
Have you already started promoting your site and started working on your SEO and social media accounts? Have you started acquiring email addresses? Do you already have a communication with your future customers?
4. This depends on the terms and conditions you have stated with your manufacturer. You can flip a bulk production in a couple of weeks and for some manufacturers it takes months. Again, it’s dependant on the discussions and agreements you have with your manufacturer. What takes the longest is the material. It needs to be lab dipped in your intended colors and then shipped to the manufacturer to be made into clothing. Discuss this with the factory and make a PLAN. If you are a small startup they will not pause their production orders with a big brand to put your styles into production just to have a short delivery. It all needs to be planned into their schedule. You need to have made up a plan internally, decide when you want to have all the drops (bulk productions made and launched on your site) and then plan this with your manufacturer.
What have you decided with your manufacturer now? What are the deliveries they have given you? Are you already done with your tech packs, bill of material, measurement lists and sourcing?
5. You aim should be to NEVER!!!!! have below 50% of margin. As a D2C online business, it would be good to have upwards 60% to be able to give free shipping, nice packaging, outstanding service and customer care. You can control all this with the target FOB costs that you have planned. You can tweak all costs and numbers to ALWAYS give you a good margin. With shitty margins you will not be in business for long and your investors will be frustrated…
For a mid-size company, a break-even margin is around 40%, calculating all the employees, overhead costs, product development etc.
There are some exceptions though. if you have special items that you absolutely want to have made in a really nice more expensive material etc. Or you will produce a low quantity of a certain style and need to pay a surcharge to the factory…Shopify is a great supported solution to launch your online shop. Perfect if you have your development team to customize to your exact needs.
You have already started, but if other members would like to take a look at Shopify, here is a link that gives you a 14-day trial.
6. We are not familiar with 2checkout.com. Other services that we can recommend are PayPal.com, stripe.com, and mondido.com.
7. Incorporate the transaction cost in the overhead and let your retail price cover it. The end customer doesn’t need to know about it and would be annoyed if it were added as an extra cost, such as shipping.
8. First off, we are not layers, and our answer here should not be regarded as legal advice. That being said, we think you should aim for trademark protection of your name and logo. Our experience is that you should not focus on copyright protection. If a competitor copy you and just make a minor tweak, then your copyright is not valid. Having your D2C business model, focusing on your product development, you will be the first out anyway.
A trademark application takes time so you should get started as early as possible. Every country has their own trademark office where you can apply. There are some organizations were you can apply for a larger regions, such as EUIPO were you apply for all EU countries at once. It looks like you are going full speed ahead. Therefore you should apply for trademark protection in all your intended markets.
You want the trademark protection for two major reasons. The first is so that your brand is protected and no one tries to steal your thunder. The second is to make sure YOU don’t interfere with someone else’s brand. You don’t want to be sued in the US for example, because your brand turned out to be too similar to an existing one.