Serious about starting a clothing line? If so subscribe to our RSS feed or Email notifications for exclusive articles/updates that you don't want to miss!

“Why Retailers Say No”Retailers reject placing orders with new apparel lines for many of reasons from not having reasonable prices to not being a well known brand. When presenting your line to retailers there are many things that can have u producing an order or going home empty handed, but don?t think that receiving an order from a large retailer means you are on your way to a successful clothing line. A large order from a chain store retailer can break u just as much as make your apparel line.Working with large retailers can sometime have a negative effect on your bottom line. Chain store retailers have higher profit margins than most stores you might work with also causing you too sell your product for a lower price. A large order at the start up phase of an apparel company can leave you with a lot of shirts and nowhere to go with them. You?re probably asking yourself what do I mean huh? Well let me tell you most chain stores or department stores when placing an order with you they expect a certain amount of ?sell through? and already know the percentage of markdown they can place on your product in order to maintain their profit margins. If your brand doesn?t perform like it should you can find your company hit with a store ?chargeback?. Which they can automatically deduct from your store invoice (the money they owe you!) or they can ship you back the pieces of garments that didn?t sell and u will be responsible for refunding them the money for unsold merchandise. Unless no refunds was stated in the purchase order which will probably leave u with NO order at all.

These are not the only reasons that can leave your brand hit with a dreaded chargeback. Many startup apparel companies don?t have the resources to meet the requirements of large retailers which is a long list from shipping requirements all the way to apparel finishing. They can charge you for not using a preferred carrier (like ups) you can also be charged for not placing suggested price tags on your garments and from what I?ve seen most new apparel companies don?t have the right financing too invest in such small aspects of the clothing business.

Most expect to pay on better terms than most boutiques or mom and pops stores that u may work with. They usually work with manufacturers who offer Net-30 or Net-45. Which is when they place an order you ship out and they will pay your store in 30 or 45 days from the date when they received the order. Not a bad idea right?Wrong! Most up and coming apparel companies don?t have the necessary cash flow to sustain a business while waiting to be paid. (see article on no money upfront order financing). COD (cash on delivery) is the way to go which are what terms most boutiques or small stores offer.

Reasons that could affect your bottom line:

1. Not shipping on time (past order completion date)
2. No price tags
3. No hang tags
4. Not shipping within their specified terms.
5. Product not selling as expected. ?sell through?
6. Not packaged correctly
7. Net 30/45 shipping terms
8. Not shipping with a preferred carrier (ups)
9. Wrong style/color shipment
10. Unscheduled order delivery (shipping without prior notification)
11. Separate purchase orders for each style of garment

By any means these are not the only reasons a chargeback can occur. Working with large retailers can have many drawbacks as you can see. Most will eventually over saturate your brand fast. This can most likely peak your brand interest at an early stage. I think working with boutiques and mom and pop stores is the best way to build brand awareness and gain purchase orders. Most don?t require price tag which can require u purchasing a UPC number which can be rather expensive. They are most likely to work with you are not as usually upset about late orders and don?t require a preferred shipping method as long as you ship! As you can see receiving large orders is not the light you probably thought it would be and will come with time and a lot of MONEY but is well worth the wait and all the much better when your company is more prepared.You have read the article now let me know what u think! Do some research on “charge backs” and give me your opinion.Fashion06

Serious about starting a clothing line? If so subscribe to our free newsletter for exclusive articles/updates that you don't want to miss! or Our RSS Feed

Continue This Discussion In Dobizo Forum

Popularity: 1% [?]