Entrepreneurs all across the world are making money from their clothing line business and you can also make money starting a clothing line. All a designer needs to do is to ensure that he or she carves a niche for his business and works hard to build their brand name to be accepted beyond his/her city of operation.

A recent report published by Statista shows that the global apparel market is projected to grow in value from 1.5 trillion U.S. dollars in 2020 to about 2.25 trillion dollars by 2025, showing that the demand for clothing and shoes is on the rise across the world.

The regional distribution of apparel is expected to stay mostly consistent between 2015 to 2020, although the Asia Pacific region had the highest level of growth at four percent. The three world’s largest apparel markets are the United States, China, and Japan in descending order. In this article, we will help you with the estimated cost of starting a clothing line business in your city.

Estimated Cost of Starting a Clothing Line Business

When it comes to starting a standard clothing line business, one is expected to spend the bulk of the start-up capital on leasing a storage facility in an ideal location and of course equipping the facility with industrial sewing machines and related cloth-making accessories.

Please note that the exact cost of opening a clothing line business depends on the size of the clothing line and where it will be located. You are also expected to purchase sewing materials and pay your employees and utility bills. These are the key areas where you are expected to spend your start-up capital on;

  • The Total Fee for Registering the Business in the United States of America – $750.
  • Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines, and other software) – $3,300.
  • Marketing promotion expenses as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
  • Cost for hiring a Business Consultant – $2,500.
  • Insurance coverage – $2,400.
  • Cost for payment of rent for 12 months at $1.76 per square foot in the total amount of $53,300.
  • Cost of facility remodeling (construction of racks and shelves) – $5,000.
  • Other start-up expenses like stationery ($500) and phone and utility deposits ($2,500).
  • Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $60,000
  • The cost for equipping the production factory – $45,000
  • The cost for start-up inventory (materials, sewing supplies and packaging materials et al) – $25,000
  • Storage hardware (bins, rack, shelves, food case) – $3,720
  • Cost for store equipment (cash register, security, ventilation, signage) – $3,750
  • The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, Sound systems, tables and chairs et al): $4,000.
  • The cost of Launching a website: $600
  • The cost for our opening party: $3,000
  • Miscellaneous: $5,000

From the rough estimate listed above, you would need a minimum of one hundred and seventy-four thousand two hundred and thirty USD ($174,230) to establish a medium–scale but standard clothing line business in any city in the United States of America.

Please note that this is a rough estimate and we usually advise our readers who are interested in starting a clothing line business to directly contact wholesalers and suppliers of the types and brands of sewing machines and other sewing accessories they want to get the real-time prices of these items.

The truth is that, if you are a good bargainer, you can get a better deal that will help you beat down the estimated price as listed above. Having said that, here are some of the factors that will influence the cost of opening a clothing line business in the United States of America;

Factors That Will Influence the Cost of opening a Clothing line Business

  1. The Type of the Clothing line Business

A major factor that will determine the overall cost of opening a clothing line business in the United States of America is the type of clothing line business you want to open. According to the price segmentation of the fashion industry, we can identify 5 segments of pricing in fashion apparel: Haute Couture, Ready to Wear/Pret a Porter, Diffusion, Bridge, and Mass.

Normally, if you just want to start a clothing line business that is running from a brick-and-mortar store facility, you are going to spend more when compared to a clothing line business that is strictly online (operating from an eCommerce store) and outsourcing the production of your clothes.

  1. The Choice of Location

Another major factor that will determine the cost of opening a clothing line business in the United States of America is the location. In business, location is a key part of what determines the success of the business. There are business consultants and realtors who are specialized in helping people choose an ideal location for their business.

For example, renting or leasing a production facility in a location that is off the city center or a major road will be less expensive when compared to renting or leasing a production facility in a highbrow area.

  1. The Required Licenses and Permits

In the United States of America, you cannot open a clothing line business without first applying for a mandatory license and permits. You would need an operational license, building license, zonal permits, signage permits, and reseller permits amongst others. As expected, these licenses and permits cost money and it will influence the overall cost of opening a clothing line business in the United States of America.

To get the overall cost of licensing and permits associated with opening a new clothing line business in the United States, we will advise that you reach out to your city government. You also need to consider state and federal requirements.

  1. The Type of Facility

The type of facility you want to operate your clothing line business from is also a major factor that will determine the overall cost of opening a clothing line business in the United States of America. As regards the facility, you have the options of renting, leasing, or designing and constructing your production facility from the scratch.

With renting and leasing a production facility, you might just have to spend extra to modify the production facility to fit into what you have in mind, but there is a limit to how far you can go and it will be dependent on what the landlord of the facility wants.

If you want to construct your production facility from the scratch, you will buy the land or property, bring up your design, and construct and equip the production facility. You will agree that you are going to spend way more when compared to people that rent or lease a production and store facility in an industrial area. This indeed will greatly influence the overall cost of opening your clothing line business.

  1. The Size of the Clothing line Business

Another very important factor that determines the cost of opening a clothing line business is the size of the clothing line. Of course, the larger the clothing line, the large the budget to get it up and running especially as it relates to furnishing and equipping the production facility.

Aside from the cost of furnishing and equipping the production facility, it will also cost you more to position employees to man different job positions in the facility. For example, less than a handful of employees can man a clothing line business that is in a 10 by 10 facility while it will take about a dozen employees to man a clothing line business that is in a 20 by 20 facility.

6. Cost of Recruiting and Training Your Staff

The fact that you are opening your clothing line as a new business means that you are expected to recruit and train your staff. The training will help you sell the corporate culture of your organization to the new employees. As expected, it will cost you money to hire expert trainers that will help you bring your new hires up to speed and that will add to the overall cost of opening a clothing line business.

  1. The Cost for Branding, Promotion, and Marketing of the Clothing Line Business

The cost of branding, promoting, and marketing the clothing line is yet another key factor that will determine the overall cost of opening a clothing line business in the United States of America. Trust me, if you want to win a fair share of the available market in your city, and the online market, then you must be willing to pay for effective branding, promotion, and marketing of your new clothing line business.

It is not cheap to come by an expert in branding, promotion, and marketing that will help you compete with brands that are already determining the market direction of the industry in your city. So, if you add the cost of paying a branding and marketing expert, it will surely increase the cost of opening your clothing line business.

  1. The Cost for Furnishing and Equipping the Business

Another factor that will determine the cost of opening a clothing line business is, of course, the cost of furnishing and equipping the production facility. To start a clothing line business, you will need some or all of the following machines, equipment, and tools;

  • Industrial sewing machines
  • Pattern makers for crafting designs
  • Women and men’s dress forms used for garment building
  • Scissors
  • Hole punchers
  • Straight and curved rulers
  • Pencils
  • Measuring tapes
  • Notchers for marking seams
  • Pins
  • Slopers
  • Dotted pattern paper
  • Sewing machine needles
  • Hand sewing needles
  • Threads
  • Sketching books
  • Drapings tools
  • Dressmaking Stick pins
  • Muslin
  • Style tapes
  • Fabric shears
  • Soft lead pencil
  • Marking pen
  • Pattern plotter
  • Pattern-making software
  • Computer
  • CAD tools for designs
  • Digital drawing tools
  • Digitizer board for pattern scanning
  • Heat transfer machines for T-shirts
  • Print tables
  • Racks
  • Slat wall
  • Mannequins
  • Hangers
  • Labels and Tags
  • Packaging materials
  • Industrial pressing irons
  • Supply of fabrics
  1. The Cost of Insurance

The cost of paying for insurance policy cover is yet another important factor that will determine the overall cost of opening a clothing line business in the United States of America.

In the United States, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from. Thus, it is imperative to create a budget for insurance policy cover and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your clothing line business.

  1. The Cost of Registering the Business

The cost of registering the clothing line business is yet another cost that will influence the overall cost of opening the business in the United States of America. Although the cost of registering a business is affordable, it will no doubt add to the overall cost of opening a clothing line business in the United States of America.

  1. Source of Your Supplies

Another major factor that will determine the cost of opening a clothing line business in the United States of America is the source of your supplies. If you get your supplies from a cheaper source, then it will help bring down the cost of starting the business.

If you can build a robust business relationship with some of the leading fabrics, buttons, threads, needles, and other sewing accessories manufacturing companies, then you would have succeeded in cutting down the cost of your supplies. You can even get your supplies on credit.

12. The Cost for the Purchase and Customizing of Uniforms

Another factor that will determine the overall cost of opening a clothing line business in the United States is the cost of the purchase and customizing of uniforms. As expected, production line workers, salespersons, front desk/payment attendants, other workers, and security personnel all need uniforms.

All these uniforms will cost you money which is why it must be part of your budget if you are looking towards opening a clothing line business in the United States of America.

13. The Cost for Grand Opening of the Clothing Line Business

You will agree that in recent times, no clothing line business opens its door for business without first organizing an opening party to officially launch the business. This means that the cost of the grand opening of a clothing line business is part of the factor that will determine the overall cost of opening a clothing line business in the United States of America.

You can choose to do a soft opening if you are operating on a low budget or you can go for a grand opening party. The bottom line is that it is a cost that must be part of your budget and this cost will influence the overall cost of opening your clothing line business.

Ongoing Expenses of a Clothing Line Business

If you run a clothing line, you are expected to have in your books what is known as your ongoing expenses. These can include;

  • Rent and lease
  • Supplies and inventory (materials, sewing supplies, and packaging supplies et al)
  • Utility bills (internet subscriptions, phone bills, signage, and software renewal fees et al)
  • Maintenance of machines
  • Salaries of employees