Designing the right business model

AVID WATCHERS of such highbrow reality TV shows as America's Next Top Model and Project Runway will be well acquainted with the heartache, criticism and rejection that young hopefuls, who truly believe they are the next Kate Moss or Jean Paul Gaultier, encounter as they try to break into the fashion industry.

While natural talent, a fresh look or creative flair can help fashionistas to overcome these hurdles and carve out a successful career as a model or fashion designer, starting your own fashion label requires something extra - business acumen.

No amount of raw talent can compensate for an inability to make sound business decisions and to get to grips with the financial aspects of the venture.

Dublin City Enterprise Board has worked closely with several designers who have set up their own successful fashion businesses, and it also sponsors the Dublin Fashion Week. The Dublin Fashion Week autumn/winter 2008 event took place last month, and Eibhlin Curley, assistant chief executive of the enterprise board, gave a talk on how to make it in the fashion business.

Curley explains why the board decided to sponsor the event: "Fashion designers tend to be small businesses, with only one or two people working in each business. They don't have the resources to market themselves, which is why a collective event like Dublin Fashion Week maximises their exposure to trade buyers and media."

Over the years, the enterprise board has supported a number of its fashion clients directly through financial assistance, mentoring, training and its business networks, but Curley explains that Dublin Fashion Week provides a new marketplace for these new designers to sell to buyers in Ireland. "The commercial viability of any business depends on making sufficient sales at a profit," Curley comments.

She explains that innovation and new product development are essential to the growth of Irish businesses, particularly so in the fashion industry. The feedback from trade buyers at the Dublin event can be an important step in preparing for larger fashion events in London, Milan or Paris.

What sort of practical help does the board provide to aspiring designers? She explains that graduates of design colleges such as the Grafton Academy and the National College of Art and Design (NCAD) may have honed their design skills and learned all the technical skills of making clothes, but the enterprise board can teach them those all-important business skills.

"Excellent design skills are not enough," Curley insists. "The success of the business depends on being able to run a business - producing the garments, marketing, selling, financial skills and people and project management skills."

One of the major challenges that fashion designers face is the long lead time between purchasing materials and getting paid by buyers, so an ability to manage cash flow is key.

"We would encourage potential entrepreneurs to make realistic financial forecasts so they can assess if their business can be profitable," she says.

So what can aspiring designers do to increase their chances of becoming the "Next Big Thing" in the fashion industry? First of all, get some business experience and build up your contacts, confidence and credibility before going out on your own.

"Working with a big fashion label will help build contacts and gain an insight into the commercial aspects of the fashion industry," she explains.

"Experience of dealing with production runs, handling customers, marketing and budgets can be useful things to learn while getting paid for the work."

Many of the enterprise board's fashion clients learned the ropes from others. For example NCAD graduate Jennifer Rothwell (www.jrothwell.net) built up 15 years of invaluable fashion experience in New York, working for top design houses such as Calvin Klein, before launching her own label.

Rothwell received mentoring from the enterprise board in 2005, and was given a feasibility study, website and export grant the following year.

She won the Brown Thomas Designer Mentor Programme Awards last year and showcased her autumn/winter '08 collection at the recent Dublin Fashion Week event.

Curley advises fashion entrepreneurs to keep start-up costs to a minimum, as well as learning the ropes from others. She suggests starting the business from home, or availing of enterprise centres that provide subsidised business units for the first three years.

"Cash flow is a major issue for start-up businesses, so careful planning and trying to avail of anything free is advisable," she adds.

"Excellent design skills are not enough. The success of the business depends on being able to run a business