Tuesday, March 31, 2009

It's Harsh & Long - Read at Your Own Risk

It's been a while, it seems like, since I wrote about anything business related that wasn't a sale or talk about an upcoming show. I have a lot going on right now and a lot to figure out, which makes it hard to know exactly what I should share and what I shouldn't. So, I'm just going to jump in. Those who know me personally know that I leave very little unsaid and I guess this blog is only a little different....so here it goes.

How it all started

As you may know from my posts in January, my line was picked up by sales reps from the Dallas and Atlanta markets. Wow...exciting right? Glamorous, right? No, in reality it is expensive, a lot of hard work, time consuming, and up to this point completely free of any reward of any kind. Yes, that includes monetary reward. Turns out I made a mistake. A big one. One that has cost me a lot of money and a lot of time. This is basically how it went down:

For two months at the end of 2008, I contacted every sales rep in the southeast that I could find contact information on. I received rejection after rejection, stating that they were already carrying too many lines or were not accepting new lines at this time. So, you can imagine my excitement when I got a YES! I was thrilled. I really thought back then - a whole six months ago - that getting a rep was a major accomplishment...that it meant you had "made it". Boy, was I wrong. From my experience hiring a rep is basically the same as hiring a gardener or a housekeeper. If they have time for you, they'll work for you. But you'll pay. Oh, you'll pay.

After being with my first rep for almost a month, she referred me to my Atlanta rep who accepted me as a new line on the spot. It was January....what a way to start off the year! If you go back and read my post you will understand my excitement. I really thought this was a great sign of great things to come for 2009.

Also, way back then, I thought that paying $100 a month and 12% commission wasn't a shabby deal. I mean, I understand that they have to pay for their showroom and travel time, etc. Fast forward to January 15 - due date for each rep to be paid their seasonal fee of $600. Multiply that by two. Factor in a decline in sales in December and January. Ok, not off to such a great start, huh? I owe $1200 and am banking on the hopes that these two are going to sell, sell, sell! Add to that the cost of shipping, print materials, new hangers, purchasing fabric to create the Fall 2009 line which debuted in February, etc, etc, etc. You get my point.

Fall 2009 Collection

Where it got me

Here we are present day. Beginning April 2009 and my 3rd & 4th month being "at market". One rep has made one sale at a whopping $488. Keep in mind that is wholesale, any other time I would be thrilled with this sale! Also, I was notified that this account rarely pays and to be sure and get a check and wait for it to clear before I ship. How do I feel now? Like I have wasted a LOT of money. Money that I can't afford to waste right now. (Not that ANYONE can EVER afford to waste money.) You understand what I mean though - things are tight.

My Mistakes - I made them

Before you begin to think I'm completely bashing my reps, let me tell you this: I have made mistakes - big ones - that also effected my experience at market. My goal was to be there by Spring 2010 (which means January). I made my goal a year early, which I thought was fabulous until now. It was too soon. My reps tell me my price points are too high and that I need to lower my prices so I can get INTO the stores and then raise them when I actually start making sales. THAT, my friends, I cannot afford to do. I'm already barely breaking even on a wholesale sale after paying 12% commission. My line is too expensive to make to wholesale at rock bottom prices. It works for so many companies - even small ones like mine. I'm just not set up to work this way, apparently. I thought by now I'd be looking further into manufacturing, but I just can't find any companies (IN THE USA) that will manufacture on a small scale that I can afford. My sales just aren't high enough to justify making even 250 of a single design. Someday....maybe.

Another Sign

Another sign it was too soon was when I found out that I had to have my Fall 2009 line designed, created, produced, photographed & shipped with line sheets, price lists, etc - all in 4 weeks! I hate to admit this, but while we are being honest - Fall 2009 is not my favorite to date. I didn't have enough time. Not to mention - I haven't even added a boy's line to the Fall lineup yet! It is hard to "crank things out" or force yourself to be creative when you are not feeling it. Generally, I use the 6 months between seasons to create the next line.

Questioning Myself

This makes a million questions run through my head. Do I start making a less detailed, less expensive line that retailers can afford to buy? (BORING!) Ok, boring but it might work. But is that really what I want to do? I can't imagine myself making a hundred a-line dresses and enjoying it - if you'll notice I don't even offer basic alines. I'm leaving that up to someone else - there are only a million other companies that offer them. No offense, of course, it's just not my thing. Next questions: Should I leave the markets and sell on my own? I have established one account with a local boutique, I suppose I could do more. Do I even WANT to continue to wholesale? Do I have time to factor in selling as well as designing, sewing, paperwork, etc? I don't think so unless I change my line. Ok, so this brings me to my last idea.


Lisa working my booth @ Cottontails

I really TRULY enjoyed Cottontails Village. It was a lot of work, but had the potential to be a great money maker if I had gone into it know what I know now. (Lots of lessons learned there too) Part of me thinks I really want to continue to do these large vendor shows and just carry a lot of inventory and sell online. No, I'm not talking about getting rich. I'm talking about making a living. I never went into this thinking I would get rich, because Lord knows - from what I've seen so far the profit margins are small! Trust me - I just finished my taxes.

So, there you have it. I kind of think I know what I want to do. I think going this route would allow me to be more creative instead of cranking out the same thing over and over (which I do not enjoy) I'd love your input - but not your hate mail of course. I'd also love to hear of any vendor shows you think I may like to participate in. anna (at) sweet-dreams-designs.net Email me!


Teresa Pomerantz said...

Okay, I think it is great that you acknowledge your mistakes and lessons learned. I like the idea of your art shows and boutiques. I can put you in touch with a few here in Austin that you might like.
I know jumping in before you are ready can really cost you... I offered to do my kid's daycares school portraits. I bought lights, backdrops, and stands. It cost me about 600 to set up and I made 300 in sales because while the pictures came out cute- they just didn't want to order. So it was too soon for me to spend that kind of money- but hey - lessons learned, right?

jess said...

Thanks for telling your story. I'm just starting out and it's nice to hear how it is working for others. Good luck to you. Your designs are adorable!

Jus Shar Designs said...

Bless your heart, hon.

I can't imagine going through all that in such a short amount of time...all that money gone. I couldn't afford that mistake either.

I'm always going back and forth about where I want the business to go....like you. You want to make a living, but still enjoy what you do.

Maybe this is has been a huge life lesson, and things will be easier from here on out for you. I'm hoping so anyway. GOOD LUCK!

Melissa said...

I think you're doing great. Every business has growing pains and with your creativity you're going to do fine in the long run. I think doing shows like Cottontail Village is a great thing. I know personally I LOVE to attend that show and others like it. I actually discovered you through a google search for Cottontail Village when trying to find out what vendors might be there. You were the only one I found! So I think you're definitely doing something right if out of all the vendors there, on this great WWW, you're name is the one that pops up for a regular Mom like myself. Good luck and keep up the great work.

Harmony said...

I read your blog often and usually don't comment but wanted you to know that I love your designs and hope you continue to make clothing! I was so glad when I found you on Etsy for the first AU shortall I ordered and have loved everything since. It is so hard to find cute boy clothing, especially something different from the usual mall store choices. By the way, I love the frog outfit in the Cottontail photo! For those of us no longer in Birmingham who were unable to attend (i.e., me) let us know how we can order!!

Brandie said...

I love how honest you are and that your not afraid to put it all out there. I am just starting out but have definitely made some mistakes too. I completely understand your feelings about your Fall collection. That is how I feel right now about my current collection. I had been working on a fall launch when the opportunity came up to do a summer fashion show. I jumped at it even though I wasn't ready. The collection that I made, while well recieved, just doesn't have my heart. It makes it alot harder to work at marketing and promoting it when it is not true to your vision. Good luck with all that you are trying to do. I think that doing shows is a great idea. That is the route that I am planning on right now. Art Fairs and direct selling. We'll see how it goes;)

Paula Prass said...

I just read this and want you to know I've been in showrooms for the last few years, have 20+ reps. I would be glad to share my experience w/ you if you'd like. Send me an email and we can talk.