Clothing Shops
Sub-division of the sector of Clothing Shops
The sector contains shops specialising in specific market segments: men’s clothing, women’s clothing, children’s clothing and clothing for young people. This distribution can also be subdivided, according to the level of the business and the clothing:
Prestigious shops and fashion houses – the items sold in the shops are more expensive and are generally imported directly and are in the latest fashion and/or uniquely produced items by well-known designers who are in demand, imported to Israel by franchise holders in limited quantities.
Boutiques – specialise in the specific and focused target audience – young women, middle-aged women etc.
Fashionable shops – intended mainly for young people and based on sales of leading and well-known brands
Clothing shops – with a large selection of medium-quality and moderately well designed clothes, for a number of population groups
Bazaars – where one can find goods of varying quality, at especially low prices and from sources that are not always identified
Chain stores
Market characteristics
A high level of seasonality – there is a renewal according to the seasons of the year. The sector is more active in the autumn and spring, when stocks are replenished in preparation for winter and summer. In order to cope with the seasonality problem, end of season sales are held, with most items being offered at a significant discount.
Frequent changes in fashions – outerwear and underwear are strongly affected by frequent changes in fashions.
A high level of customer involvement in selecting products – the consumer devotes a considerable amount of time to seeking information related to the product (manufacturer’s name, price, quality and so forth) before purchasing.
Customers
The target market includes the entire population of the country, segmented by the following criteria:
Age and gender – the difference in clothing sizes and design between women’s clothing and men’s clothing, different age and taste
Use – work clothes, everyday clothes, sports clothes, evening clothes and so forth
Income – the higher the level of income, the greater the tendency to purchase more expensive and prestigious clothes.
Competition
Competition in the sector is very severe. Mainly after the administrative restrictions were removed and the customs duties and taxes on clothing from most countries around the world were reduced. There is a tendency to concentrate in commercial areas for clothing and footwear and it is important to maintain the uniqueness of the collection.
Additional competition exists on the part of the large marketing chains. In the domain of sports clothes there is also competition on the part of shops engaging in sports equipment and accessories.
Suppliers
They can be divided into four main groups:
1. Local clothing manufacturers who manufacture in accordance with their tastes and designs, and often manufacture knockoffs.
2. Local manufacturers who manufacture under a brand name
3. Designers – produce single items or limited series of items for prestigious shops
4. Importers who import prestigious brands or less expensive products of mediocre quality.
Marketing methods
1. Discount campaigns and end of season sales. During sales it is possible to advertise in the local or national press.
2. Shops selling brands or chain stores sometimes benefit from the manufacturer’s advertising in other channels, such as television, ads in cinemas or on the radio.
Factors affecting success
Location, the design of the shop, the uniqueness of the clothing at the shop, stock levels and reputation.
Turnover and profitability in the sector
Following are the average annual turnover percentage per employee:
Women’s clothing Men’s clothing
Prestigious shops 50% - 55% Prestigious shops 46% - 60%
Designer clothing shops 38% - 41% Fashion houses in big cities 38% - 45%
Clothing shops 35% - 38% Fashion houses in remote cities 38% - 43%
Boutiques 39% - 43% Clothing shops 38% - 44%
Customary payment terms
Customers: sales are usually in cash or by credit card. Discounts may be given on cash purchases in order to save paying the commission to the credit card companies.
Suppliers: payment in cash – a 5% - 10% discount for payment in cash is customary in the sector. Credit – the customary credit in the sector stands at 90 – 120 days. Turnover discounts – offering the shop owner an incentive in the form of bonuses or a refund on products.
Licences and certification
No special licences for running the business are required. If the shop engages in direct importation on its own, an import licence from the Ministry of Industry and Trade is required.
Insurance
Insurance for the business against fire, theft and so forth, third party insurance, building and content insurance and inventory insurance.
In addition to the aforesaid, consulting with an insurance agent regarding required insurance is advisable.
| Clothing Shops
The sector contains shops specialising in specific market segments: men’s clothing, women’s clothing, children’s clothing and clothing for young people. This distribution can also be subdivided, according to the level of the business and the clothing:
Prestigious shops and fashion houses – the items sold in the shops are more expensive and are generally imported directly and are in the latest fashion and/or uniquely produced items by well-known designers who are in demand, imported to Israel by franchise holders in limited quantities.
Boutiques – specialise in the specific and focused target audience – young women, middle-aged women etc.
Fashionable shops – intended mainly for young people and based on sales of leading and well-known brands
Clothing shops – with a large selection of medium-quality and moderately well designed clothes, for a number of population groups
Bazaars – where one can find goods of varying quality, at especially low prices and from sources that are not always identified
Chain stores
Market characteristics
A high level of seasonality – there is a renewal according to the seasons of the year. The sector is more active in the autumn and spring, when stocks are replenished in preparation for winter and summer. In order to cope with the seasonality problem, end of season sales are held, with most items being offered at a significant discount.
Frequent changes in fashions – outerwear and underwear are strongly affected by frequent changes in fashions.
A high level of customer involvement in selecting products – the consumer devotes a considerable amount of time to seeking information related to the product (manufacturer’s name, price, quality and so forth) before purchasing.
Customers
The target market includes the entire population of the country, segmented by the following criteria:
Age and gender – the difference in clothing sizes and design between women’s clothing and men’s clothing, different age and taste
Use – work clothes, everyday clothes, sports clothes, evening clothes and so forth
Income – the higher the level of income, the greater the tendency to purchase more expensive and prestigious clothes.
Competition
Competition in the sector is very severe. Mainly after the administrative restrictions were removed and the customs duties and taxes on clothing from most countries around the world were reduced. There is a tendency to concentrate in commercial areas for clothing and footwear and it is important to maintain the uniqueness of the collection.
Additional competition exists on the part of the large marketing chains. In the domain of sports clothes there is also competition on the part of shops engaging in sports equipment and accessories.
Suppliers
They can be divided into four main groups:
1. Local clothing manufacturers who manufacture in accordance with their tastes and designs, and often manufacture knockoffs.
2. Local manufacturers who manufacture under a brand name
3. Designers – produce single items or limited series of items for prestigious shops
4. Importers who import prestigious brands or less expensive products of mediocre quality.
Marketing methods
1. Discount campaigns and end of season sales. During sales it is possible to advertise in the local or national press.
2. Shops selling brands or chain stores sometimes benefit from the manufacturer’s advertising in other channels, such as television, ads in cinemas or on the radio.
Factors affecting success
Location, the design of the shop, the uniqueness of the clothing at the shop, stock levels and reputation.
Turnover and profitability in the sector
Following are the average annual turnover percentage per employee:
Women’s clothing Men’s clothing
Prestigious shops 50% - 55% Prestigious shops 46% - 60%
Designer clothing shops 38% - 41% Fashion houses in big cities 38% - 45%
Clothing shops 35% - 38% Fashion houses in remote cities 38% - 43%
Boutiques 39% - 43% Clothing shops 38% - 44%
Customary payment terms
Customers: sales are usually in cash or by credit card. Discounts may be given on cash purchases in order to save paying the commission to the credit card companies.
Suppliers: payment in cash – a 5% - 10% discount for payment in cash is customary in the sector. Credit – the customary credit in the sector stands at 90 – 120 days. Turnover discounts – offering the shop owner an incentive in the form of bonuses or a refund on products.
Licences and certification
No special licences for running the business are required. If the shop engages in direct importation on its own, an import licence from the Ministry of Industry and Trade is required.
Insurance
Insurance for the business against fire, theft and so forth, third party insurance, building and content insurance and inventory insurance.
In addition to the aforesaid, consulting with an insurance agent regarding required insurance is advisable.
0 Comments about Clothing Shops:
Post a Comment
<< Desirability of Opening a Business