How to Sell Fabric Online: A Step-by-Step Guide

Would you like to sew, knit, embroider, and feel passionate about sharing your knowledge with the rest of your community?

Fabric shops are back in demand after a challenging few years. More and more people are turning to DIY lifestyles due to fast fashion’s destructive impact — with UK arts and crafts retailer Hobbycraft revealing that sales of sewing machines climbed by nearly 30% in 2016.

You may be in the right place to open a fabric shop, whether it’s part of a franchise or your own independent store.

Throughout this guide on how to open a fabric shop, you will find all the information you need to carry out your project, including tips on how to write a business plan for your fabric shop.

Conducting market research for your fabric store

Before looking for an eCommerce platform for textile, conducting market research is the first step in opening a fabric shop.

As a result of this exercise, you will be able to determine if your project is commercially viable. This research will also go some way in helping you develop your future marketing strategy.

For this market study to be successful, you will need to:

• Analyze the trends in the sector: is it growing? Do new trends emerge? Are customer’s buying habits changing? Are subscription boxes popular?
• Assess the competition: who are your direct competitors (other fabric shops in your area) and indirect competitors (websites or apps such as Depop)? What products do they offer? Which services do they provide in addition to these products?
• Study the expectations of your future customers: What kind of products do they want? Will they also need services? What is the typical profile of a customer (age, socio-professional status, income, etc.)?

Consider whether you need a business plan to organize your market research.

Choosing the right concept for your fabric store

Establishing the specific vision you have for your fabric shop will depend on choosing the right concept.

Fabric shops come in different types:

• Specialized fabric shops in which only sewing-related objects or fabric are sold
• Fabric shops that also sell wool and knitting materials
• Fabric shops that also sell sewing-related products
• Fabric shops that also sell textile products online (such as knitted scarves and blankets)

Market positioning provides you with a way to differentiate yourself from your competitors through factors such as the overall atmosphere of the store, a commitment to ethical practices, workshops and regular meetings with your local suppliers, workshops with bloggers, etc.

It is important to develop a value proposition that is consistent with your concept and will form the very DNA of your fabric shop.

Franchise or independent fabric shop?

Once you’ve defined your concept, the next step is to decide whether you want to join a franchise or open an independent store.

Both options have their advantages. You’ll have all the freedom and autonomy in the world to set the vision for your new business when you go independent. Franchises come with the reputation of a well-known brand, marketing support, and a network of suppliers.

Choosing a location for your fabric shop

After deciding on the type of online fabric store you want to open, it’s time to consider the location. This choice is important because it will have a direct influence on how successful your venture is.

Your location on a busy downtown shopping street will give you high visibility, but your rent will increase.

In contrast, a quieter street will require more work to get your name out there, but will save you money on rent.

In opening a fabric shop, your ideal location may be in the city center or further out in an industrial area. Choosing where you think will be most effective is up to you.

Choosing the legal structure of your fabric store

Once you have decided the location of your future shop to sell fabric online, you need to decide its legal form.

Choosing your store’s legal form is an important step since it will affect:

• Taxes on your business
• Personal taxation
• In the event of bankruptcy, you are responsible for the company’s debts

It depends on your preferences and personal circumstances (e.g. how many partners are involved in your venture, how much start-up capital is available, etc.).

Before choosing a legal form, you should carefully consider all the possible options.

You can find more information about the different legal forms available to you if you are based in the UK or the US on the gov.uk guide for UK business owners and the SBA guide for those in the US.

Developing a marketing plan for a fabric store

The next step is to develop a solid marketing plan for your fabric shop with the aim of attracting new customers and building customer loyalty.

It is not an exhaustive list, but it gives you some ideas. It’s up to you to do some digging and figure out which actions you want to, (and based on your budget), can realistically take to market your fabric shop. Some marketing ideas include:

• Handing out flyers on the street is an example of street marketing
• Partnerships with influencers and creation of social media profiles
• Implementation of a website and a newsletter to showcase promotional offers
• Publicity in the local newspaper
• Advertising on websites related to sewing, knitting, and other fabrics
• Video tutorials or online training on the shop’s website
• Offering sewing workshops in-store

In addition, you will need to consider how to build customer loyalty. Here, a loyalty program with a card and benefits might be a good option. Consider making a sewing or knitting gift box that showcases your different products. It would be a great way to both sell your stock and bring it to the attention of a wide range of potential customers.

If you want to open a fabric shop, write down all the actions you can think of and then implement them, giving priority to the ones that you feel will be most effective.

Analyze the budget for opening a fabric store

Once you have decided your textile product catalog, found a location, and selected the shop’s legal structure, you will need to consider the elements needed to develop the budget to open a fabric shop.

Setting up a fabric shop requires certain equipment

The first step is to purchase all the items you will need to equip your store for many successful future sales, such as a cash register, shelves, sewing machines, and an inventory system, window displays, trinkets, and initial stock of fabrics, ribbons, needles, wool, iron-on patches.

The recruitment plan for a fabric shop

You can, of course, start from scratch. But perhaps you’re entertaining the thought of keeping your business open for longer hours further down the line.

If you expect to receive a large number of customers all at once, you may have planned to provide several checkouts — in which case, you will need to hire staff.

You should hire employees who are passionate about sewing and knitting, so that they can advise customers accurately and share their knowledge of the subject.

Advertising for new staff requires defining responsibilities, skills required, schedules, and salary expectations for each position.

Launching a fabric shop requires administrative services

If you intend to broadcast music from your fabric shop, you will also need insurance, water, electricity, maintenance, and a premise license.

Alternatively, you could delegate part of the administrative management to an accounting firm or outsource the shop maintenance to a cleaning service. Get quotes from several professionals in order to estimate these expenses as accurately as possible.

Writing a business plan for a fabric store

Having gathered all the information in the previous sections, you can now begin writing the business plan for your fabric shop.

There are two major components to a business plan:

• A financial forecast intended to highlight the potential profitability of the project and the need for initial financing.
• Present, in detail, your project, the team, your business strategy, and your medium-term goals.

With the business plan, you will try to attract funding from your bank or potential investors, so it must be impeccable.

If you have no experience

Using specialized software has several advantages:

• The writing process is guided by detailed instructions and examples for each step.
• Templates for business plans can inspire you
• By letting the software handle the accounting aspects for you, you can easily make financial forecasts.
• You receive a professional document, formatted and ready to be sent to your bank.

Click here to try our software for free if you are interested in this type of solution.

Establishing a fabric shop with financing

The last step in the creation of a fabric shop is to find financing after you’ve written your business plan.

The initial budget needed to open a fabric shop will vary depending on its size.

Find out the difference between a business plan and a budget.

To obtain the needed sum for the launch of your shop, you should assess the various financing options available to you.

You must first estimate how much money you and your potential partners can contribute to your project. It is important that you do not overlook your personal contribution, even if the amount seems very modest in comparison to what you need to raise. Institutional investors look at it as tangible proof of your commitment to the venture.

It’s also possible to apply for a professional loan from a bank to finance part of the start-up costs, whether that involves buying sewing machines or furnishing the premises with cool furniture. Consider applying to different banks so that you can compare offers and choose the one that works best for you.

Another option is crowdfunding. The goal of crowdfunding is to collect donations or equity from family members or kind strangers who believe in your project.

You can even raise awareness of this initiative by awarding donors with ‘counter-gifts’, including a free basket of sewing supplies, an invitation to a DIY workshop, or a discount on their first purchase.

Also consider state aid for business creators and buyers. You may be eligible for an interest-free loan, for example.