1. style and fashion

 START-UP
START-UP GUIDE
GUIDE
FLANDERS
FLANDERS
FASHION
FASHION
INSTITUTE
INSTITUTE
UPDATE JUNE 2013
UPDATE JUNE 2013
CONTENT
INTRODUCTION
PART 1: APPLYING FOR JOBS AND
INTERNSHIPS
2 3 5_BUSINESS PLAN
23 6_PLANNING ON OPERATIONAL LEVEL
24 24 26 Production
Schedule
1_JOBS
Looking for a job
Salary
Contracts
Unions
2_INTERNSHIPS
Internships
Internships abroad
3_APPLYING
Cover letter
Resume
Portfolio
Applying via the internet
The interview
4 4 6 7 7 8 8 8 10 10 10 11 11 12 PART 2: STARTING UP YOUR OWN
BUSINESS
14 4_START-UP FASHION BUSINESS
Legal form of businesses
How about taxes?
Corporations
Formalities
Social regulation
Working as a freelancer
Looking for an assignment
Contracts
Head over heels...
15 15 16 17 19 20 20 21 21 22 7_MARKET ECONOMY
28 Market research and competition analysis 28 Commercial policy
29 Sales
30 8_COMMUNICATION
Public Relations
9_PROTECTION
brand name
Drawing and design rights
Copyright
Image rights
Exploitation
Website
10_FINANCING
35 35 38 39 39 40 40 40 41 Contributions and subsidies
42 42 44 45 46 11_SPECIALIST LITERATURE
48 12_SOURCES
49 ENCLOSURES
50 Accounting
Private resources
Externe financial oppurtunities
13_COLOPHON
62 START-UP GUIDE | June 2013 © Flanders Fashion Institute
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DISCLAIMER
Flanders Fashion Institute paid a lot of attention to the construction of information gathered in this guide for start-­‐up fashion businesses in Flanders. However, it cannot be held responsible for the correctness of the content. The user is aware of possible changes; Flanders Fashion Institute will not acquaint anyone with new information. If changes are made, social media and the FFI website will inform you about the adapted version of the guide. Thirdly, FFI cannot be held liable for mistakes made in websites or names, nor can it be held responsible for the content and/or the usage of this document. If the reader stumbles upon mistakes, incompleteness or inadequate information, FFI would like to be informed in order to correct, fulfill and/or adjust the content. Thank you in advance. Flanders Fashion Institute (www.ffi.be) is part of Flanders District of Creativity (www.flandersDC.be) and stimulates entrepreneurship in fashion in Flanders. FFI leads designers towards proficiency in business and offers career guidance. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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INTRODUCTION
It’s a done deal. You finished school and with a certificate in one hand and a list of possible careers in the other, you’re trying to figure out what to do as a new designer. So what’s next? When it comes to possibilities after graduating there’s no light at the end of the job tunnel. The fashion scene is wild at heart and offers plenty of opportunities. It’s your call to choose the sector that fits you best. Fashion means hard work. Glitter and glamour only show the tip of the iceberg, ‘titanic-­‐
wise’ that is. What’s underneath is by far the most interesting part of it all. In this world, ambition and perseverance are necessary to survive. This guide provides you with information about the barriers you can come accross when applying for a job and how to overcome the typical pitfalls which come with the start-­‐up of your own company. FFI offers some relevant sources as well. We advise you to look into this information very closely. It may not be as time-­‐consuming as you think, plus it runs out a couple of disappointments when looking for information piece by piece. FFI reveals its secrets and reaches out for help finding the best possible and fashionable way to success. If you made it through the whole document and you still have some unanswered questions, do not hesitate to make an appointment with FFI. The first meeting is a special introductory offer and free of charge. Specialized advice and assistance cannot be provided by FFI but the institution will however refer you to the right people. Flanders Fashion Institute also organises workshops and information sessions that offer a profound look at the business aspects of fashion. Keep an eye on our website (www.ffi.be) and subscribe to our newsletter. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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PART 1:
APPLYING FOR
JOBS AND
INTERNSHIPS
START-UP GUIDE | June 2013 © Flanders Fashion Institute
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1_JOBS
LOOKING FOR A JOB
Jobhunting brings various issues. When do you start applying? How do you get this or that job? Where do you find information? Which aspects are negotiable? In this document we will make sure all answers are revealed. But first things first. After graduating it is important to enroll at the Employment Exchange. VDAB's main tasks are employment-­‐finding, training, education and career assistance. Once you’re enrolled, the clock starts ticking. When your waiting period comes to an end and you’re still unemployed you’re entitled to a benefit. If you want to know more about this subject you can visit the VDAB website: www.vdab.be. Where? You can find job offers in several specialized magazines and newspapers. The internet is also a great tool for looking up new possibilities. Thirdly, you can sign up with a recruitment office, an employment office or an interim agency for temporary job offers. These bureaus are specialized in acting as a mediator between employers and employees. Federgon is an excellent federation when it comes to recruiting personnel. The organisation is mainly occupied with search, selection, canvassing, outplacement, project detachment, education, interim management and service cheques. Applying for a job through such an office appears to be very effective. You can find a review of all interim agencies and recruitment offices in Belgium via the website of Federgon: www.federgon.be/federatie/leden. A little bit more on topic are recruitment agencies specialized in fashion and lifestyle. The most relevant bureaus: START-UP GUIDE | June 2013 © Flanders Fashion Institute
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BELGIUM:
FRANCE:
ITALY:
LOWER AND MID-SEGMENT:
MID-SEGMENT:
HIGHER SEGMENT:
RS Recruitment België
People to people
Between Design Research
Vlaanderenstraat 7
11, rue de la Ville l’Evêque
Via F. Viganò 4
2000 Antwerp
75008 Paris
20124 Milano
T: +32 (0)3 294 64 28
F : + 33 (0) 1 42 68 38 26
T: +39 02 29014402
www.rsrecruitment.eu
www.peopletopeople.fr
www.betweenresearch.com
Corstiaens, Marcussen & Geers
HIGHER SEGMENT:
ALL SEGMENTS:
Florian de Saint Pierre et Associés
Moda Research
52, Boulevard Malsherbes
San Polo, 2580
75008 Paris
30125 Venezia
T: +33 (0)1 45 61 24 89
T: + 39.041.5237402
www.fspsa.com
www.modaresearch.it
Work in Fashion
Chaussée d’Alsembergsesteenweg
995/23
B-1180 Brussels
T: +32 (0)2 649 80 49
www.corstiaensmarcussen.com
HIGHER SEGMENT:
(ook actief in Italië)
Sterling
Sterling Conseil
Michael Boroian & Associates
Avenue Louise 65
6, Avenue Franklin Roosevelt
B 11 1050 Brussels
75008 Paris
T: +32 2 535 78 03
T: +33 (0) 1 70 91 56 00
www.sterling-conseil.com
www.sterling-conseil.com
(ook actief in Italië en NY)
(ook actief in Italië en NY)
Chantal Baudron s.a.s.
61 Boulevard Haussmann
75008 Paris
T: +33 (0) 1 47 42 58 20
www.chantal-baudron.fr
Agnès Barret
33, Rue de Grenelle
75007 Paris
T: +33 (0) l 47 05 03 15
www.agentsecret.fr
LONDON
THE NETHERLANDS
NEW YORK
ALL SEGMENTS
ALL SEGMENTS
HIGHER SEGMENT
Denza Limited
HTNK Fashion Recruitment & consultancy
Sterling
33 Glasshouse Street
Industriegebouw
445 Park Avenue New York
London W1B 5DG
Oudezijds Achterburgwal 141-c
NY 10022
T: +44 (0) 20 3008 7898
1012 DG Amsterdam
T: +1 212 836 4715
denza.co.uk
T: +31 (0)20 421 1577
www.sterling-conseil.com
www.htnk.nl
(ook actief in Italië en België)
Freedom Recruit
Academy House
36 Poland Street
London W1F 7LU
T: +44 (0)20 7734 9779
www.freedomrecruit.com
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The internet is probably the most common tool to look for a job. Specialized vacancies are put online immediately so those who are interested can respond quickly. These days most companies have websites which makes it easier to apply for a position abroad. It is very useful to keep an eye on these company websites. They often publish vacancies on their own website since it is a preferable medium to stay in touch with outsiders. Design organisations and fashion labels often seek for employees within reach and therefore often put vacancies online. Flanders Fashion Institute created a forum with creative and management functions. A special task force selects relevant jobs and puts them online on our website. The amount of published jobs is accelerating each month. So if you’re looking for a job, make sure to check FFI's page: www.ffi.be/en/vacancies. – www.jobat.be – www.fashionunited.be – www.fashionsolutions.nl – www.rsrecruitment.eu – www.londonfashionnetwork.com – www.id-­‐mag.com/joblist ALSO: the network you’ve been building up is very useful if you’re looking for a job. Networking is can be crucial. FFI advices everybody to announce the news once you’re unemployment. Friends, family or previous notable work relations can often help you find what you’re looking for. SALARY
If you’re working on a permanent basis you receive a monthly paycheck. In Belgium a salary consist of two parts: primary employment conditions and secondary employment conditions. The primary conditions are the most important ones. They contain the ratio of gross salary to working hours. The daily activities and executed duties are part of the primary employment conditions. Secondary employment conditions on the other hand, are the more attractive conditions, such as superannuation scheme, reimbursed travel expenses, bonuses, company car, holiday pay, et cetera. It is important to negotiate these primary and secondary conditions or benefits with your employer. Service degree
Category III
1
2026,25
Functional experience during the first three years of practice 2
2370,22
Functional experience from the fourth year on to the seventh 3
2484,91
Specialized experience from the eighth year on to the twelfth 4
2564,05
Professional experience from the thirteenth on to the twenty-­‐third 5
2646,02
From the twenty-­‐fourth year on The graph above shows the required minimum wages according to the CAO 2010. These are minimums but take into account that the average salary of a stylist or a designer is generally higher. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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CONTRACTS
If a company decides to employ you, you normally receive a contract stating all the details and circumstances. Obviously, not every contract is the same. So before starting your job, be sure to have a broad idea of what you are and are not entitled to do. It is definitely advisable to ask a third party to review your contract. In Belgium there are two kinds of contracts. Indefinite employment contract: When agreeing on an employment contract with a permanent appointment you choose not to fix a final date. During your two months of probation the company can dismiss you summarily. After this small trimester, a legal period has elapsed and the company cannot just fire you without a valid reason and has to submit this to approval of the cantonal judge. Be warned, the minimum term is two months, but when decided differently in your contract you have to make sure you finish the terms you agreed upon. Breach of contract is not something to take lightly. Definite employment contract: Another option is to sign up for a contract on predetermined terms. In this kind of contract the start and end time of your employment are fixed. Possibilities include: project, pregnancy, semester, etc. There is no minimum duration, nor a maximum. After completion of the contract period, these are the most common steps that follow: – End of employment contract – Automatic renewal of the contract: automatically for the same period of time – Explicit renewal of the contract or an indefinite employment contract – When your contract is renewed twice for the same function and the same time span, the contract will automatically be considered as a indefinite employment contract. Interested? Find more information here: www.belgium.be/en/work. UNIONS
A union or syndicate is an organisation in charge of defending one’s rights, particularly the rights of employees and job seekers. Neither job seekers or employees are obligated to join a union. However, you can subscribe voluntarily. If you do so, you have to pay an admittance fee. This is definitely not a waste of money: when you’re experiencing trouble or misunderstandings with your employer, the union will support you. They can also help you with difficulties regarding unemployment compensation. There are three unions in Flanders: ABVV (Socialist Union), ACV (Christian Union), ACLVB (Liberal Union). You can find more information about the assignments of unions and an overview of Belgian unions on the website of the Federal Public Service E mployment, Labour and Social Dialogue: www.employment.belgium.be/defaultTab.aspx?id=6196. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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2_INTERNSHIPS
INTERNSHIPS
Work experience is often decisive when applying for a job, but as a starter you’re obviously new to the profession. An internship can help you. It will enrich your CV and companies prefer candidates who have acquired experience. Luxury fashion houses often recruit interns and if you show enough commitment, you might land a job. Internships give candidates the opportunity to gain experience; free experience that is. Companies see interns as free employees, however getting to know the ins and outs of a company, can give you invaluable insights and knowledge. As an intern you’re often committed to projects and up to date on the last innovative novelties. When looking for an internship, you can use various tools. First of all, try to appeal to your social and professional network. Let them know you’re on the lookout for an internship. The more people know, the better. Secondly, the internet offers billions of possibilities to obtain an internship in fashion. You can find several websites specialized in posting fashion vacancies. Nonetheless, don’t limit yourself to open vacancies. Make a list of places or companies you want to work for and send them a cover letter and your CV. Research shows that 70% of employers appreciate such an engagement. When no position is available, you will probably end up in the company’s database and network. This way you will be the first to know when they have new job opportunities. Researching websites should definitely be part of your internship quest! Be sure to check these: – www.ffi.be/vacatures – www.fashionunited.be – www.careerstyler.be – www.creativeskills.be/jobs/ – www.creativenetwork.be – www.cultuurnet.be/vacaturebank – www.behance.net/joblist – www.htnk.nl INTERNSHIPS ABROAD
Erasmus Scholarship The Erasmus scholarship is a grant that compensates travelling and accommodation expenses when studying abroad. The extent of the scholarship depends on multiple factors such as the length of the study period, the rescources of the family and the destination. The European Union as well as the government of Flanders put this scholarship together. The amount of money is estimated between 300 and 700 euro, based on the family income. Previous scholarships are not taken into account. I-­‐creative scholarship via Leonardo da Vinci In collaboration with Flanders District of Creativity, Flanders Fashion Institute offers recent graduates the opportunity to apply for an internship abroad. However, only students of creative courses are qualified, including fashion and textile designers. You can find more information here: www.flandersdc.be/en. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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One more thing: an internship abroad is an adventure; it’s a way to broaden your horizon. You get to learn new cultures which will benefit your experience level. Don’t worry about the financials; there are plenty of possibilities to get scholarschips. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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3_APPLYING
COVER LETTER
Your cover letter should be more than just a scribble. It should show your interests and attract the attention of the employer you’re addressing. So, in short, we’d like to draw special attention to this topic. Tips and tricks to a leading cover letter! – First, introduce yourself and describe your motivation. – Secondly: describe your experience and sum up your personal particulars that are relevant for the job. If you don’t have any experience yet when applying, do not mention every single job you had as a student – focus on relevant information! – Then, when you've clarified your motivation and described your details, you can propose to explain your motivation in person. Refer to attached documents: resume, copy of your degree, etc. – Be sure to arouse the employer’s interest. Be creative! Enclosure 1: Example of application letter RESUME
In a resume you define an image of yourself making sure your future employer has all the necessary details about you. Side note: keep it down to a minimum and only mention experiences that are relevant for the job you’re a applying for. Obligated – Personal details: Name and surname, address, telephone number, email address, place of birth, date of birth, marital status, citizenship; – Education: school career, education, internships, certificates, … Mention the duration of the courses and organise all courses anti-­‐chronologically; – Formal picture; – Knowledge of languages: mention your mother tongue and other language skills; – Interests; – Experiences: internships, jobs, student jobs; – Technical competences: write down which software you have (thorough) knowledge of; knowledge of Illustrator, Photoshop, Word and Excel can be decisive. Optional – Other competences: organisational, executive, communicative, et cetera; – References: some employers still feel very strongly about recommendations and references. Tips! – A resume should be about one page long; – Make sure the lay-­‐out is well-­‐organised in order to get a clear view on the content of your resume; – Avoid long paragraphs full of text – bullet points are the way to go; START-UP GUIDE | June 2013 © Flanders Fashion Institute
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– Avoid informal language, language mistakes and slang; – Avoid unprofessional email addresses. Your employer will not respond to [email protected]. An email address containing your name or initials is more likely to be responded to; – Do not send mails via your work address. It’s not professional and there’s a chance it will backfire and end up on your (current) boss’s desk. Enclosure 2: Curriculum Vitae PORTFOLIO
A portfolio contains your designs, drawings, images and pictures. A portfolio is used to persuade your opponent or future employer of your competences. Therefore it’s extremely important to make sure it’s well-­‐organised and personal. How to get your portfolio in shape: – Quality trumps quantity! Make sure your portfolio reflects who you are and what you’re able to do. Choose carefully what to put in and what to leave out. – Create diversity. Show them what you’re competent of. The more qualitative and diverse work you enclose, the better. – Think about the lay-­‐out. Make sure it links up to your work and let it dominate all the way through your portfolio. – Use a striking hardcover, thick paper and, when printing your work diary, choose the highest resolution possible. In colour! This way it’s professional and it will draw all the attention you need. – Adjust the composition of your portfolio according to the company you’re applying for. APPLYING VIA THE INTERNET
Can you imagine living in a world without Facebook and Instagram or job hunting without surfing on websites first? The World Wide Web can’t be left out of our daily life. It offers many opportunities and different ways to speed up applications. It’s more likely you will find a job via the internet than via a newspaper. You can show your work online and add a personal touch to it. Emailing doesn’t take days and employers notice talent more easily. When it comes to applying for a job, internet is the way. Many websites offer a vacancy page where you can find lots of job offers, often divided by sector. There is no faster way than applying via mail. Your future employer receives your resume and cover letter instantly. It appears to be to most convenient and popular way these days. Social network websites such as Facebook, Twitter and LinkedIn appear to be very interesting as well when it comes to catching up with the newest job offers. You can put vacancies online and you can announce you’re looking for a job. An online resume via LinkedIn is the next big thing. Be aware of the fact that companies do look at your online status and references! Applying online, easy as pie? If you think applying via the internet is way easier than before, think again. It’s definitely not that simple. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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– The quality of online cover letters and applications is generally slinking. Emails often look careless or sloppy and contain more mistakes than paper applications. Make sure you act professionally and strive for perfection. – Avoid popular and slang language. It’s very easy to make mistakes since it’s the internet law to abbreviate every word online and create new ones at the same time. It inhibits your chances and you’ll be considered inaccurate. – Due to the quick response a lot of people anticipate and react on available vacancies. Choose carefully what you’d like to do and which applications you’re going to spread. – Your cover letter is best placed in the body of your e-­‐mail. Send your resume attached. Mention the job you’re applying for and the reference as the subject of your e-­‐mail. This way HR-­‐
managers can easily find what they need. The following methods are currently the way to go: E-­‐portfolio An electronic portfolio covers the overall outcome. People can view your projects online with just a simple click. This means no more running around from one company to another with copies of your portfolio. The main advantage of an e-­‐portfolio: you can reach a wider audience and on top of that, online, you can claim the number of visitors who downloaded or viewed your profile/e-­‐portfolio. Website A website is the ideal way of telling something about yourself and your work. Employers have the tendency to check out the candidate’s website first. As a next step they will look for any other information or reference. A well equipped website (quality first) is a must. THE INTERVIEW
Last but not least, do not underestimate the importance of the job interview. You only get one chance to convince your (future) employer you’re the right man/woman for the job. How to impress? – Prepare well and collect as many information about the firm as possible, this way you show no lack of interest. Be aware you have to show your motivation, not only on paper. – There’s no harm in taking a picture of yourself, a copy of your master project or an article which states you’ve cooperated to a project or activity. – Practice practice practice! Try to practice your answers upfront. Since the interview only takes 15 minutes (in general), improvising is not done. There will be some tricky questions dished up. It’s up to you to be well prepared. As for the improv: try to be yourself at all times and don’t let nervousness take over the conversation. – History shows these questions are quite popular: – Sum up three of your strongest/weakest characteristics. – What are your ambitions? – What are your expectations towards the company? – What are your hobbies and which skills related to those could be applicable to this job? – Make sure you know what you want. Moreover, make sure you explicitly know what you don’t want. That way you will make a self-­‐assured impression. – Be on time! Better, be 15 minutes early! START-UP GUIDE | June 2013 © Flanders Fashion Institute
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Observe the proper forms When it comes to outfits and looks, make sure it’s taken care of, down to the last detail: – Always look the interviewer right in the eye in order not to look insecure. But certainly don’t stare, as this can be awkward for the interviewer. – If you have a business card, hand it out pronto after the introduction. – Remember the name of the people you are introduced to. – Shoving your seat is considered inappropriate when applying for a job. Lift up your chair instead. – Sit all the way back on your seat. Don’t wiggle about on your chair. – Smile! Even when they ask you tough questions! START-UP GUIDE | June 2013 © Flanders Fashion Institute
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PART 2:
STARTING UP
YOUR OWN
BUSINESS
START-UP GUIDE | June 2013 © Flanders Fashion Institute
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4_START-UP
FASHION BUSINESS
Every designer has his or her dream goal. Most of the times it’s either starting up a company or showing a collection in Paris. Dressing celebs comes with the shows in Paris. Front row seats are merely occupied by bloggers or celebs. However, that dream often dies after reality kicks in. Starting up a business is tough and running a fashion company takes a lot of money. A passion for fashion is not going to get you on top. It takes more than love for the trade. You have to be willing to give up a lot of free time, work day and night and be prepared that the return on investment is extremely low in the beginning of your career. Best case scenario you can pour incomings right into the company again. Don’t expect a royal paycheck at the end of the month. Keep this in mind! – Knowing the right people is definitely an advantage. An informal network can help you spread the news, your news. RSVP to events where fashion people gather, be spontaneous a nd embrace your social skills. You never know what somebody could mean to your company someday. Printed business cards are a must have as well. – Be professional in every move. Make sure every document is coherent and complete, layout is important. If possible, use the same font or colours that match your portfolio or other documents. Be polite and patient (especially during a conflict). Nevertheless, dare to bargain (over a price). – Information is power. Gain as much information as considered relevant. Talk to other people, colleagues, Flanders Fashion Institute or the bank and pitch your idea. They can give you feedback, broaden your view and help in fine-­‐tuning the business concept. LEGAL FORMS OF BUSINESSES
Choosing the legal form of your company may be the most important business affair you will have to deal with. Every form comes with advantages and disadvantages; it’s up to you what to prioritize. It’s important to know the various obligations and duties. The most common legal forms are the one-­‐man businesses and the corporations or trading partnerships. The following paragraph reveals the differences between the two: – Probably the most convenient advantage of a one-­‐man business is that there isn’t a minimum/initial capital, the requirement is not applicable. Furthermore, there is no bank statement needed, nor a financial plan nor a memorandum of association. This form omits a lot of administrative and accounting duties which leaves plenty of room for flexibility and makes for a fast decision making process. Managing a one-­‐man business seems very independent since the owner, as a natural person, has all the rights to decide. – On the other hand this concept comes with some disadvantages as well. Mainly the several liabilities are in sharp contrast with the flexible conditions mentioned above. When in debt, certain measures will be taken from outside. In the case of a one-­‐man business your private possessions form a deposit to compensate a possible financial deficit. Investments in the company can only be made with private means or through a bank loan. You cannot rely on a third party for a financial contribution. Furthermore, the fiscal rules are less profitable compared to START-UP GUIDE | June 2013 © Flanders Fashion Institute
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the tax freedom which comes with a trading partnership. Last but not least, the continuity of the business is not guaranteed in case of illness or death. In Belgium, personal taxes consist of quick ascendant scales, opposed to corporation taxes. Corporation taxes start with slow ascendant scales. Later on, they mount up to 33%, while the maximum sum of personal taxes often reaches 50% o f the incoming payments. In conclusion: corporation taxes are considerably lower than the taxes that come with a one-­‐man business. However, when the amount of money you’re earning is still decisively small, personal taxes are a lot more profitable. Also, when the profits of a corporation are used for private causes, one needs to take into account that accountants revert to the rates of the personal taxes (50%). The accounting policy gets more complicated which consequently drives prices up. There is still another option. One can choose to be a self-­‐employed person next to one’s main occupation, meaning having two different jobs at one time. I.e. one, a professional main occupation, which consists of at least 50% of all job time (60% being the minimum percentage for educational workers) and two, a job on secondary basis in which you act as a fully self-­‐employed employer. Students can also apply for sel-­‐employment on a secondary basis. HOW ABOUT TAXES?
The semi self-­‐employed person pays the same amount of social taxes as the regular 100% self-­‐
employed one. However, they both need to join a social insurance company. Semi self-­‐employed people who are liable to VAT are obligated to report their taxes and of course pay their contributions to the government. It is possible to be exempted from taxation; you can apply for a release if your income is under a certain level. According to this last fact it is obviously not possible to withdraw the VAT taxation at the end of the year. In Belgium 21% is deductible when working in self-­‐employment. When self-­‐
employed on a secondary basis, income taxes of both professional activities are put together. Make sure you don’t earn too much (Tax professional activity + Tax self-­‐employed activity), your tax return could end up in a higher scale which consequently means you will have to compensate your income. If you choose to classify all your rescources in a corporation, this will improve your financial stability. It so happens that the liability one is indebted to, is confined to the financial input of the partners. Third parties can invest in the corporation too. Probably the most significant difference between the corporation and the semi self-­‐employed person is that when a partner/the owner deceases, a corporation does not have to discontinue its activities. Disadvantages of the raise up of a company or corporation are mainly the many formalities. As opposed to the one-­‐man business, a corporation is obligated to have a financial plan and a minimum capital. Flexibility is an issue too, since the decision making process and the workload is divided between several partners. The choice is up to you. Questions? Contact FFI! START-UP GUIDE | June 2013 © Flanders Fashion Institute
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CORPORATIONS
Just to make it a little bit more complicated we’d like to introduce you to the different forms of a corporation. If you choose to build up a corporation, you should decide whether to put everything up in incorporation or a PLC (public limited company) with restricted liability. In a nutshell, this means that the organisation is strictly subdivided in the company’s equity capital on the one hand and the partner’s private funds on the other hand. A financial debt cannot be fulfilled by private means or in case of a declaration of bankruptcy the private funds of the partners cannot be broken into. Some incorporations apply a unrestricted liability policy. This means that the partners are personally involved when the company for example owes a s.o. a particular amount of money. However, there are few restrictions associated to these restricted liability forms, especially towards the directors. When taxes are not paid, mistakes are made or the law is being overruled, the limitations of one's private equity will omit immediately. In these cases the private funds or one’s own capital will be broken into. If the company is declared bankrupt within three years after its founding, the court will, based on the company’s financial plan, assess whether the directors are jointly and severally liable or not, with the imaginable consequences for private equity. The most common forms of corporations are collected beneath. These are all applicable to fashion companies. For more information you can consult the brochure “Mijn eigen zaak. Starten met kennis van zaken”. Sidenote: it’s in Dutch. Go to www.agentschapondernemen.be/download/file/fid/689 The government has worked out several options for designers who are just starting out. For example, the private company with limited liability (PLC) or S-­‐BVBA in Dutch. Entrepreneurs can combine limited liability with a small starting capital. However, there are strict conditions attached. The main condition is that a financial expert should formulate the financial plan. This expert will investigate if the starting capital is sufficient to assure business continuity in the first two years. BVBA (ltd) NV (plc) company with public limited E-­‐BVBA limited liability company one-­‐man BVBA Associates At least 2 associates
At least 2 associates One associate Minimum capital 18.550 euro 61.500 euro 18.550 euro 18.550 euro At least 6.200 euro
At least 61.500 euro
At least 12.400 euro At least 1 euro (if
and at least 1/5 per
and at least
share share Nominative shares,
Nominative or bearer
Nominative shares,
Nominative shares,
with or without
shares, with or
with or without
with or without
voting rights without voting rights voting rights voting rights Starters BVBA Or more associates deposit Capital deposit Shares per
START-UP GUIDE | June 2013 © Flanders Fashion Institute
justified financial
plan) 17
Shares register Deed Management Yes Yes, in the case of
Yes Yes nominative shares Authentic document Authentic document Authentic document Authentic document One or more
Executive board of at
One business
One or more
business manager
least 3 directors;
manager appointed
business manager
appointed in the
natural or legal
in the articles or by
appointed in the
articles or by the
person; appointment
the general
articles or by the
general assembly;
for six years. assembly;
general assembly;
appointment for a
appointment for a
appointment for a
predetermined or
predetermined or
predetermined or
unlimited period. unlimited period. unlimited period. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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FORMALITIES
Before starting your company, as a self-­‐employed person or as a semi self-­‐employed person, the law dishes up some conditions you have to carry out before action can be taken. Establishing requirements for starting up your own company: – Minimum age of 18; – Basic knowledge of management, proven by a diploma or experience. The diagram below lists the formalities which come with starting up a business. The formalities are listed chronologically, so you know what to do step by step. CURRENT ACCOUNT – Open a current account at a financial institution (bank). MEMORANDUM OF ASSOCIATION – Only mandatory for partnerships (private or public) – Appeal to a notary (PLC, private or public, restricted or limited liability) – Conduct a deed at the commercial court – Registration of the deed – Publication of the deed by the notary in Belgian law gazette REGISTRATION – Only compelled for partnerships (private or public) BOX OFFICE FOR ENTREPRENEURS – Research of management skills: basic knowledge of management and, in case of restricted employments, professional knowledge – Research of licenses (trading, professional card for foreigners) – Presentation of the company number -­‐ assigned by the BCE -­‐ to individuals – Advice TAX IDENTIFICATION – Request a VAT identification number via a VAT inspection office – Request a VAT identification number via a box office (providing payment) LICENSES ON CERTIFICATIONS – Licenses or certifications are necessary in some cases in order to perform activities – Ask for a license via competent agencies or authorities JOIN A SOCIAL SECURITY FUND – Free choice of one of the funds – Join within 90 days following the start of the activity The box offices or office windows for enterprises act as a central contact for those who’d like to start as a self-­‐empoyed person. Fire away your questions at the people behind their desks: – What do you want to know about administrative formalities? – Thought about your VAT-­‐number? – Is joining a social security team the same as joining a football team? – Health insu-­‐what? A lot of organisations offer free advice for starting designers or creative entrepreneurs. On the website of ‘Start your Business’ and on the Unizo’s website you can find amazing information tools and answers to all of your unsolvable questions. Without a doubt a ticket to a major success in self-­‐
employment. More info: www.startyourbusiness.be and www.unizo.be/uwzaakstarten START-UP GUIDE | June 2013 © Flanders Fashion Institute
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Enclosure 3: Overview of window offices for businesses SOCIAL REGULATION
"The social regulation applies to self-­‐employed workers and helpers for any activity, main or secondary, they are engaged in. The occupation is a secondary activity if one is already engaged in another profession." When founding a company, one is obliged to join a social insurance center. Preferably and only within a period of six months before the start up, up until 90 days after the establishment. You have to register a modification of your data within 14 days. Every three months you are required to pay your duties or social contributions. These contributions are indivisible and therefore one is obliged to integrally pay for each quarter in which an activity is carried out, even if only for one day. In case of late payment, the contribution, or a part of it, will be increased with 3%. In addition to the three-­‐monthly increases of 3%, there is also an annual increase of 7%. It is applied to each contribution, or at least, a part of it that remains unpaid at the end of the year it was requisitioned. There is no use in paying late, even payment orders passed on too late (banking terms) will eventually make you cough up more. The social contributions are significantly lower for self-­‐employed persons on a secondary activity. In exchange for the social contributions, you’re entitled to the following social benefits: – Family Allowance – Illness and disability benefits – Health care – Benefits for labour disability – Retirement pay – Bankruptcy allowance – Maternity aid WORKING AS A FREELANCER
When working in fashion, chances are you meet a lot of freelancers, presumably designers working on a freelance basis. But what exactly does the word ‘freelancing’ mean? Working as a freelancer means that you are established as an independent or self-­‐employed person. In addition, you're working and you’re able to work on different projects for different clients. A designer can work on his/her own collection and at the same time make money somewhere else. For example: you work as a freelance pattern maker at a larger label in order to create financial space for your own label. Next to the experience you gain, the flexible working hours are perfect in combination with running your own business. If you start your own professional activity in Belgium, you will immediately be considered independent. However, there is a catch. Make sure you work for more than one client; divide your services in order to avoid the apparent self-­‐employment. Working as a freelancer means you have to make sure people know who you are. It is extremely important you work your way up as a socialite, at least in the sector you’re working in/for. Build a large network and anyone who likes your work will do you a favor by putting in a good word for you. Having your own website is a good way to recruit customers as they can immediately see your work. In addition, it is smart to check several sites as often as possible to put your resume online and proclaim that you are a freelancer. Clients often research their employers before working with them. Therefore visibility is extremely important. Internet is the ideal solution for START-UP GUIDE | June 2013 © Flanders Fashion Institute
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freelancers. It is a key to get in touch with your favorite companies. Finding a job has never been so easy. Following websites refer to vacancy pages. Click and learn. Mind the Dutch websites, some of them are only in Dutch. FFI expanded their vacancy page and has a broad overview of different jobs in fashion. – www.ffi.be/vacatures – www.fashionunited.be – www.careerstyler.be – www.creativeskills.be/jobs/ – www.creativenetwork.be – www.cultuurnet.be/vacaturebank – www.behance.net/joblist – www.htnk.nl LOOKING FOR AN ASSIGNMENT
A different road to freelance assignments, without becoming self-­‐employed, is through a social agency for artists. As a designer, a makeup artist, a model or any other creative profession working in fashion, you can appeal to a social agency for artists. They will help you find the right job. Why? As a freelancer in the fashion industry you often work for several clients, which often leads to complicated administration. Working through a social agency for artists means you only have one employer. Problem solved. They (the bureau) hire you for the same amount of money agreed with your client and subsequently they (the bureau) will send the client the invoice. The agency shall act as a payroll account, even if the client has not paid yet. The social agency for artists delivers. As a legal employer, they submit all records, documents and legal social payments to make sure you enjoy the comfortable status of an employee. Artists don’t do paperwork? No kidding. You’d like to enjoy this personal support? Pay a visit to the website of “Het Kunstenloket” (www.kunstenloket.be/en). You can find contact information and details one the statute of artists on the website. Enclosure 4: List of social agencies for artists CONTRACTS
It’s in the interest of both parties to draw up a waterproof and clear contract. This paper contains the commands of the freelancer opposed to those of the employer. The details that should be included in the contract and the chapters that might need a closer look are discussed below: – Name of the parties entering into the agreement – Detailed project description, goals and mission – Duration of the project – Period planning – Compensation for the freelancer per day (or per project) – Who is responsible for the material – Who is responsible for the logistic costs – Who is responsible for all other incidentals? START-UP GUIDE | June 2013 © Flanders Fashion Institute
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Drawing up a clear contract is important to both parties. It often happens agreements are not certified via a paper. It’s a shame shaking on it is not sufficient, but since freelancers or employees are usually the victims, we cannot emphasize enough how well armed one is with an extensive contract in the pocket. HEAD OVER HEELS...
Hoping everything turns out all right is not enough when drawing your own collection. We serve you the top most common pitfalls when starting your own business. It’s obvious that we want to encourage you and every entrepreneur to start your own business (this guide would be so useless if not) but preferably we’d like you to look at the fashion industry down to earth. So put your reality glasses on and read the next chapter. What’s lacking? – A careful preparation: A (successful) case requires an average of 3 to 12 months preparation – Seed capital is too small: Maintain a healthy balance between private equity (= private funds) and other fortune (= funds contributed by others). A ratio of 1/3 vs. 2/3 is overall a healthy mix. – Create a clear and realistic view of all costs and expected revenues. Overall costs are underestimated and the expected returns, on the other hand, are overestimated. For designers it takes about three years for the first (modest) generated revenue. – Take different scenarios into account (not very successful to very successful) to avoid disaster. – Small amount of customers: Provide a database filled with customers, make sure the return on investment is more than one customer’s order. There is an unwritten rule that one client may not be responsible for more than 20% of the generated revenue. Keep that in mind! – Administrative burden: Get your papers in order and keep them in chronological order. – Too little guidance: We’ve written down a lot of agencies and tools designers and freelancers can use in order to start up a business. This is more than a romantic novel, use the instructions written down in the guide. There is no harm in contacting meaningful institutions. – Lack of social life: Make sure your loved ones support your decision and take into account you might have to work long hours. – High fixed costs: Avoid high occurring costs in the beginning (rent, car, ..) and try to be creative with the limited resources you have. – Be realistic and not too excited about your own project: talk to people who have an objective view. Different people means different views, different views means different opinions and subsequently, different opinions means better outcome. Outsiders see things from a different point of view and evaluate whether it will be successful or not. – People often make the mistake of working in a sector or market that is not theirs to be in. Stay true to your core business. Unless you have done extensive research and have found a hole in the market, it is better to stay outside OR find a partner. – The manager skill is something you’re born with! Evaluate your leadership capacities critically: how would you score your stress resistance and perseverance levels? Eat humble pie and manage a business partner, this way you can focus on your skills. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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5_BUSINESS PLAN
The business plan describes what your company stands for, what your goals are and how you are going to achieve them. This plan covers all major aspects of the business and gives an indication of the direction you’re willing to go. The purpose of the business plan is: – Clarity about your five-­‐year plan: description of how you are going to realize this plan and what is feasible. – Convincing third parties such as banks, investors, manufacturers and customers. – Gaining insight into the resources necessary to realize the plans such as capital or goods ... – Gaining insight in the market and the financial situation of your company. A business plan forms the fundaments of a good preparation. It is extremely wise to write your business plan yourself, as you will consider all aspects of your business and clarify the outcome of your ideas or projects. In order to clarify your financial plan, you may seek assistance; a good accountant is no waste of money. – Take enough time to write a realistic plan. In addition, a business plan is not solid, it is never finished and it is a gradual process in need of an update from time to time. Flanders Fashion Institute has an experienced employee with a great sense for business who’s willing to help you wherever guidance is needed. Meet Marie Delbeke! START-UP GUIDE | June 2013 © Flanders Fashion Institute
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6_PLANNING ON
OPERATIONAL LEVEL
When entering the production phase, all your creative ideas become reality: the drawings become tangible and flat pattern pieces will, eventually, be garments. Your input and preparations are in an advanced stage. However, this is hardly easy, production is considered highly complicated since your creation must be converted into technical data in order to produce the collection. Moreover, this is the most critical process in fashion history. It all depends on your lead times and delivery dates: if the collection cannot be delivered on time there’s a high risk the order will be cancelled. PRODUCTION
Avoid major problems by communicating efficiently. This is key. Having correct and clear conversations or talks about how and when you want something, runs out misunderstandings and it definitely fastens the process. Make sure you fulfill all of your appointments regarding the supply of raw materials, samples, patterns, technical specifications, applications, ... This way your partner has a clear and efficient view on your perspectives and can schedule his needs in order to deliver the required quality. As long as the manufacturer has not received all the components he will not start production. The patterns are usually created by the designer and are sent to the manufacturer along with a prototype. Or it could be that the manufacturer creates them for you. If you send in the patterns yourself, make sure the design matches the procedures and conventional way of working of your producer. Don’t be shy and dare to negotiate the prices and terms. Preferably sign a contract with your production partner for the supply of goods, technical specifications, patterns, payment terms, quality, cost, ... Everything said on paper cannot be held against you. You’re in favor; manufacturers are in desperate need of customers too. Manufacturers The first step in the production process is of course to find a suitable manufacturer. Below you can find a few tips to optimize your search: Engage with other designers and search on the internet together. A lot of renowned manufacturers are humble companies and it depends on word-­‐of-­‐mouth to get to know them in the first place. In terms of humbleness: do not be alarmed if a manufacturer has no website. First things first: compare several manufacturers before making a decision. Having one friend whose shoes are being produced at the same place can’t be the decisive factor. You have to take other aspects into account as well, your choice should be based on the answers to the following aspects or questions: – Is the manufacturer willing to work with a newly grad designer? – Is the manufacturer willing to produce small orders or will he not want to compromise? – What price will the manufacturer enforce? – What kinds of collections are usually made and, more important, which materials are used? START-UP GUIDE | June 2013 © Flanders Fashion Institute
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– Can he/she deliver on time? Can the manufacturer do the follow-­‐up? – Can the manufacturer deliver the required quality? – What are the terms of payment? If possible, try to pay a visit to the producer of your clothing line. This will certainly reduce the risk of misunderstandings. Take your portfolio with you, so that the producer has a clear vision of what you're attempting to achieve in the end. Secondly, it is certainly useful to obtain additional information (sneaky or followed by the rules): – Do they pay respect and take care of the products they work with? – Do they have the appropriate equipment to produce one’s collection? Do they have enough skilled seamstresses? – Can they guarantee the required quality? You can’t be too sure. Probeer een lange termijn relatie op te bouwen met je producent. Het zal jou en jouw partners helpen om efficiënt te werken, kosten te drukken en klantenwaarde te leveren. Laat dus zeker ook weten indien je tevreden bent met het geleverde werk. Dit zal helpen om een positieve relatie op lange termijn op te bouwen. Try to build a relationship with your producer. A long-­‐term relationship will benefit you and your opponents. Working efficiently, keeping down expenses and delivering customer value are highly rated qualities to overcome a split-­‐up between partners. Feedback is important for both parties, let him/her know if you are satisfied with the work done. This will help you building up a positive long-­‐term relationship. In cooperation with Flanders Fashion Institute and MAD Brussels, Creamoda introduces the publication of “Belgian Designer Partners”. It contains all Belgian manufacturers who are willing to work with young designers. The publication of this important manuscript can be found on the website of Flanders Fashion Institute. Technical card The technical card is an important aspect to optimize the communication between designer and producer. Since language is often an obstacle, talking is out of the question. A thorough technical card could be all the aid one needs when working with Asian conglomerates that don’t speak English very well. We can’t emphasize enough how important an equipped technical card is. Below, you can find and good example of what a technical design should l ook like. It’s important that all the details are visible. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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The technical drawing is illustrated by symbols. It is useful to indicate every seam in order to demonstrate the manufacturer how to finish the seams and how to use different types of stitches. Besides from the seam symbols associated with the data, a technical card also includes a size specification. This is a table displaying all dimensions of the arrows in cm. SCHEDULE
It is important to know that designers and fashion houses work simultaneously on different garments overlapping several seasons. To start the production of your clothing line in time and then to be able to deliver the orders on time, it is EXTREMELY necessary to plan everything well in advance. Below you can find an example of the production steps and the timetable of a fashion company that produces two collections a year. This schedule is drawn up for a women's collection presented during fashion week in Paris. SS 2012/AW 2013
June
SS 2013
SS 2013/AW 2014
Design & prototypes
Photo shoot
Design & prototypes
July
Photo shoot
Lookbook
August
2012
September
October
Sales
Sales
Sales in Paris
Order confirmations
Start production
Design & prototypes
Fabric fairs
Design & prototypes
November
Production
Design & prototypes
December
Production
Design & prototypes
Production
Photo shoot
Delivery
Lookbook
Delivery
Presales
January
2013
Lookbook
February
Design & prototypes
Fabric fairs
Sales in Paris
March
Order confirmations
Design & prototypes
Production
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April
Production
Design & prototypes
May
Production
Design & prototypes
June
Production
Design & prototypes
July
Delivery
August
Delivery
Photo shoot
Lookbook
Photo shoot
Lookbook
By drawing up a schedule for production, it will become clear that a financial planning is needed (and in case of loans: very much required). You’ll see that a business year is not necessarily divided in twelve even parts. There will be periods where you have a lot of expenses and costs and you will receive the incoming resoures you’ve been waiting for only months later. Planning shall be your middle name when starting up your own business. You are going to need reserves to build up your company. Don’t be impatient when it comes to financial resources. Your plan needs to convince the bank, an investor or a regular member of the family to fund your company. Planning how and when money will come in and out makes it all the more convincing and therefore trustworthy! You can read more about this in Chapter 10. Next to scheduling your money you might draw up a creative planning as well, especially if you’re working with flash collections or in between season collections. Schedule based on your delivery dates!
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7_MARKET ECONOMY
MARKET RESEARCH AND
COMPETITION ANALYSIS
As a starter you need to look for a secure and suitable place to build up your label. Not a place in the litteral sense, but a market spot. It’s important to think this matter through: In which areas is your label going to be making a difference? Why is this a matter of life and death? Well, seeing the competition waiting in line, you have to make sure you overwhelm everybody and beyond. If so, you can gradually build a strong vision and define what you want to achieve. This will help you put down a strong label with an extraordinary identity and clearly pronounced strengths. An important analysis during the preparation of your startup company is the SWOT. SWOT stands for strengths, weaknesses, opportunities and threats. Analyze your company and look at your work as a designer, your business, the market and the socio-­‐economic environment without failing truth. Be honest in the analysis and as thorough as possible; this will only benefit your business in the long run. In addition, be aware that your strengths and weaknesses are internal qualities. You can control them, improve your strengths and turn weaknesses into strengths. The opportunities and threats, such as new competitors, regulations, ... are external factors and are beyond your capacities. You have no control nor influence to affect the situation but you can be aware and anticipate where possible. OPPORTUNITIES
STRENGTH
WEAKNESSES
INVEST:
DECIDE:
THIS COULD BE AN ADVANTAGE AND IS
INVEST OR DISINVEST
FAVORABLE FOR THE COMPANY
THREATS
PROTECT:
DAMAGE CONTROL:
EMPHASIZE YOUR STRENGTHS
CHANGE NECESSARY
Market analysis The STP process is a good tool to determine the market in which you’re going to position yourself. The STP process stands for segmentation, targeting and positioning process and encloses four steps to determine your market position. Step 1: Determine the criteria to divide your market in different segments. For example you can split up the market on the basis of style, geographical characteristics, age, gender, buying behaviour, etc. Step 2: Next step is to frame the profiles of the various segments. This way you can work out for yourself which market segment is the most attractive and which target audience you want to focus on. An attractive market segment should be: -­‐
profitable; -­‐
measurable by the available information; START-UP GUIDE | June 2013 © Flanders Fashion Institute
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-­‐
large enough; -­‐
accessible; -­‐
realistic (also take your private means and objectives into account). Step 3: In this phase you decide which target audience you will be focusing on. It’s crucial to get a very accurate view of your target audience. So do not only consider age and budget but also think about leisure activities, family compositions, careers, etc. Step 4: Finally you need to think of a suiting marketing mix (price, product, promotion, place) for your target clients, i.e. how you want to address them and rouse their curiosity. Use the four p’s as a guideline for your communication: -­‐
Promotion: decide how you are going to reach your target audience. Also decide on the budget you want to spend on this. -­‐
Product: what is the added value of your collection for your target audience and what are the typical characteristics of your collection? -­‐
Price: a clear profile will allow you to determine a proper price for your product(s). Do not only take your target audience’s budget into account, but also think of the production costs, the applied margins and the prices of competitors. -­‐
Place: think of where you are going to locate your studio, which stores you want to sell at, etc. While doing this, always keep your target group in mind. If you followed the steps of the STP process, you should have a clear profile of your end consumer which should help you to refine your strategy and develop a communication plan and sales strategy. Enclosure 5: Calculation of the cost price Enclosure 6: Price strategy Competitive Analysis Besides a good market strategy, it is also very important to know who you’re competing against. Direct and indirect competitors have good reasons to shut you and your business down. Knowing your foe, means you can fight them. Refine your strategy and go for a stronger market position. To know your own business and your enemies' businesses is extremely important. This, for one, can also help to look at your business from a different angle. In addition to an extensive market and competition analysis, it is increasingly important to continue listening to feedback from your customers. This will allow you to take in a more objective motion about your company, to approach it critically and make adjustments wherever necessary. COMMERCIAL POLICY
To develop a successful fashion label, you will need to acquire brand awareness in order to build a stable clientele. Apart from press attention, having an individual showroom (possibly shared with other designers) or participating in a trade fair are the most common ways to make your customers and consumers aware of your brand. Choosing between both will depend on your collection and the vision you want to build; high end collections are usually presented in showrooms, while contemporary fashion collections are more suitable for trade fairs. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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In an individual showroom you present your own collection. If your goal is to sell to department stores and high end boutiques, a showroom is a must. An individual showroom will help you to communicate your vision to customers, press and buyers in a clear and strong way. The disadvantage of a showroom is the serious investment of time, energy and, particularly, money. Consequently showrooms are more appropriate for a limited time and are therefore mostly organised during the fashion weeks. A fashion trade fair is a place where designers and labels can present, demonstrate and sell their collections. Furthermore it is an interesting place to exchange contacts and ideas. Before signing up for a specific fair, do your research. Not only is this a very expensive business, but your choice will partly decide how the press and buyers will perceive your brand. Do not forget you need to be selected in order to obtain a spot. The most well-­‐known trade fair in Belgium is Gallery 2020, established in 2010. For other fashion fairs you will need to go abroad. In Paris you can go to Tranoï, Who’s next, Atmosphère and Première Classe (for accessories) amongst many more. In London you can go to Pure London or Exhibition at London Fashion Week. You can find a list of the most important trade fairs van de on: – www.modemonline.com/fashion/tradeshowscalendar/by-­‐date Trade shows and individual showrooms are usually organised during the renowned fashion weeks. At the moment there are up to 20 fashion weeks all around the globe. However, given the current economic situation, only the most important fashion weeks are expected to keep their significance. These are the traditional fashion weeks in Milan, London, Paris and New York. During these weeks there is also a busy show calendar. A fashion show is the communication tool, especially for large fashion houses. Not surprisingly, a show costs a lot of money, starting from €80 000 to cover the expenses of the location, lighting, models, hair and make-­‐up, etc.... and is therefore an unrealistic option for starting designers. First, develop a strong network of customers and press to make it worth doing such a large investment. Be realistic, the first fashion week you attend will not generate large amounts of revenue: buyers and press usually give young designers the cold shoulder. Interested buyers will keep an eye on young designers up to 2 to 3 seasons in order to evaluate them and see if the designer can offer continuity in his/her business and designs. Therefore, as a young designer it is smart to focus during your first fashion week on building brand awareness, networking with buyers and press and to adjust your expectations of this week likewise. Try to attract customers with creative and innovative ideas or concepts. However, when doing this, consider the timing, location and PR, whatever the event you are planning. SALES
It all starts with creativity; your creative design talent is the basis. But creativity alone is not enough to run a fashion label as you need to sell your collection as well to have the resources to create a next collection. Bear in mind that the price that the customer pays does not equal your business profit. To be profitable, you will have to apply a margin of minimum 2 on top of your production price. Furthermore, a high end fashion store will charge the consumer another 2.7 margin on top of this wholesale price. Needless to say, it is crucial to watch the production price of your collection closely. In short; with every START-UP GUIDE | June 2013 © Flanders Fashion Institute
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euro you spend extra on production, the final price tag will go up with 5.2! Of course these are only general guidelines and on some pieces you will charge more margin than on others. But also don’t forget to compare your prices with the consumption behaviour of your ideal end-­‐
consumer and to adjust them if needed. It is also useful to map out the retail prices of important competitors to get a clear view of your position in the market. Below you can find an example of a calculation from production price to retail price. PRODUCTION PRICE
25 EURO
WHOLESALE PRICE (= YOUR PRICE)
50 EURO (MARGIN OF 2)
FINAL (RETAIL) PRICE FOR CONSUMER
130 EURO (MARGIN OF 2,6)
Keep your ideal end-­‐consumer in mind when designing; not only the choice of the design itself, but also the material and the production price are important. Unfold a sales strategy and carefully select the partners you want to work with. Think about the different approach that is necessary when selling to customers/shops/companies on the one hand and selling directly to your end consumer on the other hand. Business to business (B2B) If you want to sell through multibrand boutiques, then it is of crucial importance to be present during the international fashion weeks. Selling to multibrand boutiques is a good way for starting designers to sell their collections. These buyers are rather flexible and are willing to take the risk of buying collections of young designers. If these sales go well, the next step is to approach department stores. This is especially useful if you want to enter the US-­‐ market. Selling through department stores has the advantage of being able to sell large quantities, developing your brand awareness and the big marketing campaigns the stores do (and pay for). However, department stores really focus on getting their margins and sales. They are less flexible when it comes to sales conditions, delayed deliveries and repurchasing after a bad sales season. As a result, designers are under a lot of pressure to meet the targets and cover the expenses to be present at these stores. The third option is selling through online shops. This is a good opportunity as you can reach consumers from all over the world. But make sure you know the conditions in advance. Some shops opt to manage the stock and therefore the shipping itself, while other stores are a sort of platform and leave stock management and shipping up to the designer. The well-­‐known online shops are Asos (www.asos.com) and Net-­‐a-­‐Porter (www.net-­‐a-­‐porter.com), but there are also some online shops that concentrate more on young designers (www.yoox.com). Business to consumer (B2C) It is also an option to sell directly to your (end)consumer. A large advantage here is that you can control how your collection and your vision is translated to your consumer. There are also several possibilities to sell directly to your consumer: START-UP GUIDE | June 2013 © Flanders Fashion Institute
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Own shop Own shop: the advantage of running your own shop is that you immediately receive feedback from your consumers and that you can communicate a very personal vision. After all, you design for your consumers and only they are able to give you the most valuable feedback on your designs. Especially in the early stages it can be clarifying to sell the collection yourself, to know what consumers like and don’t like. You will be amazed by how much your creative vision can differ from your consumers’ vision. However, keep in mind that you, as a designer are often not the best sales(wo)man given your close connection to the collection. Besides, waiting for the next customer can lead to frustration, as this is valuable time you cannot spend on creative activities. Don’t forget that a shop needs a management as well. Don’t rush into opening a store because of the higher applicable margins. Starting a shop asks for a huge investment and good personnel, which is also expensive and not always easy to find. Again, it’s advisable to invest your energy and money in creating and developing brand awareness and to open a shop in a later stage. A possible compromise for young designers is to open a small shop adjacent to the atelier. Web shop Sales through your own web shop: the same remarks as above apply here. Don’t underestimate the costs of the set-­‐up of an online shop. These can vary from very cheap – nearly free of charge – for a standard website, to very expensive for a personalised webshop. Don’t be mistaken, running an online store is harder than it seems! Start with building your brand awareness first. Agents Working with agents: it can be meaningful to work with an agent who takes care of the sales in a specific region. In exchange for these services you will have to pay a commission on the sales. The advantage of working with agents is that they have long term relationships with the stores built on confidence; the stores rely on the agents to know which collections will be attractive for the clientele of the shops. Working with an agent is especially advisable if you don’t really know the area or speak the language. Make sure that the other fashion labels which your agents represents match with your label. Don’t forget to sign a clear contract and also clarify exit details. Hire a legal expert if necessary. Internet sales are booming, with accessories leading the way. As a start-­‐up it can be interesting to start a web shop. This way you can avoid the high start-­‐up costs of a brick-­‐and-­‐mortar shop. However, be aware of the fact that it often creates some revenue, but it is hard to actually make substantial profit out of it. Don’t underestimate the amount of preparation, work and indirect costs that come with building a web shop. You need to provide an extended stock (and finance it), work out a return policy, present your collection with high quality pictures, keep your stock up-­‐to-­‐date, follow up on deliveries, and so on. Same goes for the maintenance of the website. Try to take the following guidelines into account: – The website needs to be user friendly and sales oriented. Suggestions on the basis of previous search operations, such as similar or matching items, for example can lead to more sales. – A good internal search engine is crucial. Research shows that 40% of the visitors go straight to ‘search’. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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– The website needs to be up-­‐to-­‐date and dynamic. This creates an extra impulse to keep coming back. – Provide an easy and reliable paying method. It is wise to collaborate with acknowledged companies such as PayPal, Ogone or Multisafepay. Apply guarantees and a clear return policy to build up consumer trust. – Ask for email addresses to keep visitors informed of changes and special actions. – The goal is to attract visitors and the challenge is to generate sufficient traffic to your website. Get noticed on famous blogs or through press releases. Which shops? It is of crucial importance that your collection is sold in the right shops. These shops should match the vision and the message of your label/collection. Below you can find some tips to help you choose and approach buyers/shops. Be realistic; it's the buyers who choose the collections, rather than the other way round. Ever since the financial crisis, buyers need to make clear choices. After buying the regular collections there remains only a small budget to spend on new designers. However, always remain critical when a buyer wants to write up an order. Before signing, you should check which other brands they sell and try to gain information from co-­‐designers on the shop’s reliability concerning payment. It often happens designers can barely stay standing as a direct result of the bankruptcy of a shop. Some tips for contacting buyers: Search the internet for all the necessary information on various buyers. It’s best to keep a file of all the shops and people you had contact with. It’s always helpful to look at your competitors and colleagues for inspiration. If you’re trying to make an appointment with a multibrand boutique, take the fashion calendar into consideration. It’s no use making an appointment during the fashion weeks. It is however advisable to attend these fashion weeks to network and present your collections. Buyers meet several designers everyday, so it’s crucial to stand out and show them what makes you different from others. If you’re trying to make an appointment with a shop, try to get their attention in a creative way to leave them wanting more. If you’re sending out a mailing, add a striking title. Be careful that your mails will not be considered as spam. If you’re sending something through the post, add a fabric sample, a lookbook, a post card, etcetera to attract attention. Make sure the collection is presented well and clearly. Bear in mind that an average meeting lasts about 15 minutes, so you only have a short time to leave a strong impression. What should you bring to such a meeting? – Prototypes of your collection – Your portfolio – A press release – Published press Some guidelines for the interview: – Be clear and honest about your collection (e.g. about the volume, the price, sales predictions, press releases,...). Lies or exaggerations will be found out and can haunt you for a long time. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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– If you’re not satisfied with the offer, try to negotiate, but be reasonable. If a shop asks for exclusivity for a certain area, try to bargain the minimum purchases or the compulsory purchases for next season. – Ask for feedback on your collection. It can give you very valuable and helpful information and insight. The buyers know what the customers want and don’t want. Listen carefully to the feedback and take it with you for your next collection. – Make sure to have a good overview/summary of the various pieces in your collection with all the available sizes, colours and fabrics so the customer can easily put in an order without any misunderstandings. A lot of stores take pieces of young designers in consignment. Mind you, these sale-­‐on-­‐return politics are financially disadvantageous, seen as you – as a young designer – take the bulk of the risk. You could however consider this option if it involves important boutiques; but always take into account that this could turn out very costly and that you need to have sufficient financial means available. To cut costs, you could apply it for a limited amount of pieces. Attached you can find an example of an order form and the accompanying terms & conditions. Bear in mind to look over the document closely, as some details will not apply to your specific situation. Enclosure 7: Example of order form and sale conditions START-UP GUIDE | June 2013 © Flanders Fashion Institute
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8_COMMUNICATION
PUBLIC RELATIONS
The press plays an extremely important role in the build-­‐up of a brand. Media messages influence buyers and ensure brand awareness. The importance of press communication cannot be underestimated. The press can make or break a collection. Especially when you have international ambitions, you should take this into account. PR should be an integral part of your communication strategy. While traditional forms of communication such as advertising focus on short term effects, PR takes care of your long term relations with the press. PR – public relations – is about the art of storytelling. It’s important that the story you’re putting out there is newsworthy. Whether it’s about a collection launch, collaboration, birthday, store opening, exposition, etc.; the story should be consistent and in line with your strategy and collection. Make sure to involve the press with every event or every situation you think would be interesting for them. Especially when organising your first event, be sure to invite enough press so you get press coverage and brand awareness. Brand awareness leads to customers and therefore a stronger customer base. There are various methods of doing PR; such as via an interview, a press conference, a press release, a newsbite, a showroom, a blog, and so on. There are also various channels – via print, via an audiovisual message or online. It’s highly advisable to use different channels and methods to reach different groups and keep potential clients interested. Again, make sure your message is consistent. You will want to get through to the right target audience, so do enough research on the daily activities and the interests of your audience and on how to reach them. Press agency You can opt to hire a press agency for your PR activities, but it’s also an option to do this yourself. Be sure to have newsworthy information and to keep the press updated on a regular basis. If you decide to go DIY, make sure you know how public relations works. You can find inspiration in specialist books, the internet, with other designers, … The advantage of working with an agency lies within the expertise, extensive network and reputation of the agents. They will send out press releases for you and make sure all the relevant press is present during your events. Furthermore they have a showroom where stylists can go and lend collection pieces. Of course these services come with a price tag. You should count on a monthly amount between €800 and €7000 (for an international agency) but don’t be afraid to negotiate as a young designer. In general, price and reputation are proportionally related. Tip When working with an agency, be sure you are a good match for each other. After all, the agency will represent your name and label. In other words, it’s important that the other labels at the agency are in line with your label and that you understand and trust each other. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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Composing a press release – Always start your press release with the statement ‘press release’ – Mention date of sending – Write in the present tense – Make sure the tone of your text is neutral – Keep it tidy or ‘TAIDI’. In other words pay attention to: – Topical interest: make sure your news is up to date – Authority: involving an authoritarian person makes your story more credible – Importance: make sure the subject interests people – Different: everything that’s far away from the daily, is more interesting – Interest: write about something people care about – The structure of your press release should be as follows: header, lead, text body and finally more info about the sender and contact info. – The header of your press release should be simple but convincing enough to make the journalist read the rest of your message. – Give all the necessary information in the lead, in a concise and clear way. – Make sure you can answer the W’s (who, what, why, where and how). – Divide the text body up into paragraphs and keep every one of them short (max. 5 lines). This keeps your text fresh. – Use quotes the journalist can use. – At the bottom you mention the contact info of the sender so that the journalist knows who to contact for more information. – If you provide images, make sure they are of good quality (in high resolution) to make it easy for the journalist to use. – Don’t forget to mention your website. – Avoid spelling mistakes or incorrect information. – Don’t add too many attachments to keep the press release clear and well-­‐organised. – Remember the KISS formula: Keep It Short and Simple. Bloggers Bloggers are a growing group of (online) journalists who, in the past couple of years, have managed to conquer an important position in the fashion world. They are easy to reach and can spread information very fast. So give them the attention they need and invite them to your events. However, don’t forget that this group asks for an entirely different approach compared to ‘normal’ journalists. For example, a lot of bloggers have a daytime job and are more likely to be available during the evening to attend events. Furthermore it’s important to use new media and social networks. These tools are very handy to communicate with your target audience (for free). Keep in mind that this is a very intensive chore that only shows results if done regularly. E-­‐business Electronic business encloses a wide range of online business activities, such as a website, a webshop, social media and such. Again it’s important to develop a clear strategy. A website of your own as a business card of your label is inevitable. A first step is the registration of the website. Via www.dns.be you can check of your domain name is still available. A logical choice would be .be, but depending on your (international) plans for the future you can also reserve .eu, .com, etc. by the registration agent. It’s START-UP GUIDE | June 2013 © Flanders Fashion Institute
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also smart to register variants of your name so that clients still end up at the right address when they type an incorrect URL. In addition, the design and layout of the website – especially in a design environment – is extremely important. The website should be clear and attractive and contain all the necessary information, such as contact info, points of sales, opening times, store address, and so on. There are several platforms for the exchange of graphic services: – www.spacesheep.be – www.pimtim.com Register via Google Analytics or another tool and check your website statistics on a regular basis. These data give you useful information about your clients. Some other tips for a good website: – Make sure the name of your website is a lot like your company name so it’s easy to remember. – Make sure the website design is in line with your collection and style; make sure everything is in tune. A good website can make you stand out from your competitors. – It comes in handy if your website is easy to find through various searching sites; so find out which terms your target audience would use and use this info. – Make sure your website is user-­‐friendly so visitors can find the desired info. Use a good navigation system. Social media are a fun, modern and, above all, cheap way to make your brand public. They're a unique way to communicate with your customers. One-­‐on-­‐one communication is becoming rare but thanks to social media you can adapt to the needs of specific customers. It’s also important to put the feedback you receive to good use so you can evolve and grow as a label. Again, variation attracts people so post new material on a regularly. Take into account that there also various risks when using social media, such as liability, reputational damage and anonymity. Mailing tools For every starting designer it can be useful to send out a newsletter so that interested clients can read what you are up to. There are several mailing tools that give you the p ossibility to generate an online database with all contact info on your customers and give you the option to create mailing groups. So if you want to send out a specific mailing, you can choose to which internal database, for example buyers, interested parties, press, and so on. These tools also keep statistics on your mailings. This way you can see who read your newsletter. Popular mailing tools are: – Emailgarage (www.emailgarage.com); – Flexmail (en.flexmail.be); – Mailchimp (mailchimp.com); – Addemar (www.addemar.com); START-UP GUIDE | June 2013 © Flanders Fashion Institute
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9_PROTECTION
By now, your story and collection are almost completed, but don’t forget to also protect your creations. Not only your collection, but also your brand name, designs, drawings, signature… are part of what is called ‘intellectual property rights’. There are various kinds of intellectual property and the associated rights differ in terms of nature, dimension and duration. You can find the most important ones below. Keep in mind that you need to develop a strategy to handle these property rights. Below you can find ideas on how you can do this by yourself, but it is also an option to ask a legal advisor to assist you on this. However, don’t get paralyzed by the information and try to find a good balance between protecting your creations and working transparently towards people who want to work with you. A business plan outlines your vision and plans for the next five years. This plan is the basis to define your strategy on intellectual property and to plan your registrations. Very important for example, is to take into account your future export actions so you know in which countries or regions you will need to register. Brand name
Brand, logo, name,
colours, signature,
...
Drawing and
design right
Shape,
configuration, ...
Copyright
Decoration,
illustration, design,
drawing, photos,
shape, ...
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Image right
Control over the
commercial use of
your name, image
or anything else
that is personal
(e.g. a picture)
BRAND NAME
Try to come up with a distinctive name for your label; a name can’t be descriptive and should not be misleading for the nature or the quality of the goods or services. Also verify whether the brand name is still available through a simple google search or through the official w ay www.boip.int. If it is, the next step is to register your label or brand. This registration is valid up to ten years, but is renewable. A registration of a brand offers protection to the name, reputation and goodwill of a brand in a market and to her ability to differentiate goods or services from the same or similar goods or services from competitors. Design a logo that is consistent with your brand name and make sure they both are recognizable. Think about the pronunciation of your brand name and how people abroad will receive it. Be careful with using your personal name as a brand name. There are possibly other people with the same name which can cause confusion or damage others. Furthermore, bear in mind that your name will be property of the enterprise and that there’s a chance that you won’t always be the sole decision maker. DRAWING AND DESIGN RIGHTS
Other than the automatically assigned copyrights, drawing and design rights need to be requested at the ‘depot’ and enlisted by the authorised official organisation. A design is considered ‘new’ when prior to the deposition date there hasn’t been an identical design made public; two designs are considered identical when their features only differ in small details. Drawing and design rights offer protection to the appearance of a two-­‐ or three-­‐dimensional product as long as it’s new and unique. A design has a unique nature when the general impression of the user differs from the general impression of the user concerning designs made public before the date of deposition. A Community Model is valid for the entire territory of the EU (27 member countries at the moment) and various designs can be protected by means of a (multiple) deposition. The right remains legitimate for a minimum of 5 years and a maximum of 25 years. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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COPYRIGHT
The essential idea of copyright is to protect the authors of creations and to permit these creators to maintain control over the various ways in which the creations are used and reproduced. This right can be divided in two legal forms: – Moral rights regulate the relation between the artist and his work. The author decides whether the work will be made public and if so, whether his name needs to be mentioned. The author can also forbid any alterations to the work. – Property rights enable the author of a creation to benefit from the exploitation (reproduction or adaptation) of his work. This is possible through transferring (for example through a licensing agreement) or selling the copyright. Copyright protects you as a creator and arises automatically from the moment you create your designs. However, the date of creation can be questioned. For this reason it is advisable to register your designs at the FOD finances or at the notary. The right remains valid up to 70 years after the death of the creator. IMAGE RIGHTS
These rights protect the individual and, more specifically, the image of an individual, including the face and body parts. – Although these rights cover a very broad scope, in the fashion industry, this right will mainly apply to the work of models for lookbooks, websites, catalogues etc…. In short, if a model or character is recognisable you need the authorisation of this person to use the image. – Therefore, a photoshoot image contains as well copyrights for the photographer as image rights for the model. The rights can be assigned (by contract) to you as the principal so you can freely use the image. EXPLOITATION
These intellectual property rights can be exploited in two ways: on a contractual basis (with the approval of the party that owns the rights) or on a non-­‐contractual basis (in other words, illegally). You can grant the permission to exploit your intellectual property rights: – You can sign a contract with an agency. The agent will represent your name en will earn a commission on the sales. However, the collection remains your property. – A distributor will buy (part of) the collection and re-­‐sell it in your name. – A licence is an agreement that lists the conditions according to which the licensee can exploit the intellectual rights of the licenser. A designer could -­‐ for example -­‐ give a license to a manufacturer or a store chain in exchange for royalties. They then ‘rent’ your intellectual property rights. This makes it possible for you as a designer to generate revenue while narrowing down the risks. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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WEBSITE
A website contains various intellectual property rights; design, text, photo, video, music, trademarks, software, database, domain name, … these are all protected creations. Make sure you own these rights and that they are all registered. For example, if the website is designed by someone else, preferably sign a contract in which the rights are handed over to you. Tips and tricks for the protection of your creations – Define a strategy to control your intellectual property rights and register the relevant rights. – Measure this strategy with your long term vision and plans. Think about the protection of your creations if you’re planning on exporting to new markets. – Don’t sign everything that is put in front of you (e.g. contracts with an agent, a distributor or a licensing contract). – The most favourable output is when your company owns as much intellectual property rights as possible. – Arrange clear agreements on intellectual property rights with people who design something for you. An ‘I-­‐depot’ can be the first step in protecting your collections and ideas. You can register your collection or idea very simply and cheap to ‘proof’ the date of creation. This way you prevent someone else developing your idea and cashing in the rights. An I-­‐depot is valid up to 5 years and can be extended. However, legally speaking this is not an intellectual property law, but it for sure is a valuable piece of evidence. When sharing details of your idea and company with others, it is smart to present a confidentiality agreement. This agreement is mutual and gives protection to both parties. The information being shared is confidential and needs to be kept secret for third parties. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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10_FINANCING
As an ambitious designer you have the best ideas and you want to take off as soon as possible. But given the long pre-­‐financing phase and the slow return on investment that typifies the fashion industry, we advise you to take a close look at the financial component of your business plan. The most important part of the financial component is the cash planning. A cash plan defines when the money comes into your business and when you need to pay invoices. This planning will expose how large your financing need is. For a fashion company, it is extremely important to control the incoming and outgoing flows of money. You can find a more elaborate explanation on the financial and cash plan in the guideline for constructing a business plan (www.ffi.be/en). ACCOUNTING
A As an entrepreneur you are obligated to maintain a number of financial aspects, which is called the accounting or bookkeeping. The extent of your accounting depends on the size of your company. As a small business it is sufficient to maintain a single-­‐entry bookkeeping. More concretely this means: – Keeping a cash book for all receipts and expenses in cash; – Keeping a bankbook for all transfers of your bank; – Keeping a book with all invoices and credit notes of suppliers; Keeping an annual inventory of all assets, claims, debts, rights and obligations of all kind and of your private resources that are linked to the exploitation of your business. It is an option to pass on the accounting to a third party, as a specialized accounting office knows all the obligations and procedures. If you work with an accountant, be sure that you also keep up to date with the current situation. Ultimately it is your own responsibility. Also for a young fashion label, it is advisable to work with an accountant to do the follow-­‐up every quarter. Supporting software could be good tool to facilitate the accountancy process, but this should be discussed together with your accountant. Tips and tricks: – Take into account that you need to hold on to all documents for 7 years. – You need to charge VAT on all of your products. – During the first three years you do not have to pay tax increases as you are not obliged to do prepayments. Some accounting offices which are familiar with the fashion industry: START-UP GUIDE | June 2013 © Flanders Fashion Institute
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Accounting offices: Callens Pirenne Theunissen & co. Swings boekhouden en fiscaliteit Jenny Putzeys Rudi Swings Jan Van Rijswijcklaan 10 Tervuursesteenweg 41 2018 Antwerp 3060 Bertem Tel. +32 3 248 50 10 Tel. +32 16 49 92 66 Fax +32 3 248 44 66 [email protected] [email protected] www.callens-­‐theunissen.com First Accounting Jan Van Gils Vanhuynegem Associates Desguinlei 20 Jiri Vanhuynegem 2018 Antwerp Floraliënlaan 2 bus 1 Tel. +32 3 216 98 90 2600 Antwerp (Berchem) Fax +32 3 237 40 85 Tel +32 3 216 07 08 [email protected] Fax +32 3 237 99 19 www.firstadvisers.com jvh@v-­‐a.be www.v-­‐a.be Filotax Phillippe van Dieren Acco Accountants Grote Steenweg 616 Sven en Cyriel Cornelis 2600 Antwerp-­‐Berchem Prins Boudewijnlaan 177-­‐179 Tel. +32 3 239 37 38 2610 Wilrijk [email protected] Tel. +32 3 448 00 55 www.filotax.be [email protected] www.accoacountants.be HVCO bvba Koen Huygebaert Fiduciaire ‘Ten Hove II’ bvba Aziëlaan 2 Filip Pelgrims 2610 Wilrijk Herentalsebaan 271 Tel. +32 3 827 60 40 2150 Borsbeek [email protected] Tel. +32 3 366 06 66 Fax +32 3 366 07 03 First Accounting [email protected] René Verdickt www.tenhove.be Atealaan 4J 2200 Herentals Malschaert-­‐Verbraeken Tel. +32 14 21 05 90 Accounting office Fax +32 14 23 34 21 Els Verbraeken [email protected] R. Orlentstraat 25 www.firstadvisers.com 2070 Zwijndrecht Tel. +32 3 569 09 90 Bofima Fiduciaire bvba [email protected] Mark Albrechts www.malschaert.be St. Thomasstraat 30 2018 Antwerp Tel. +32 3 239 50 66 Fax +32 3 281 10 81 – [email protected] START-UP GUIDE | June 2013 © Flanders Fashion Institute
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If you made a good cash plan you will see how large your need for financing is. Carefully think about where you will invest your money in while making this plan. Investing money often goes along with making trade-­‐offs, as your resources will not be unlimited. The following five principles, in combination with the priorities of your own business, can help you to make decisions. The ultimate decision depends from business to business. Tips & tricks – It is be smart to not resign from your job at the very start. In that way you still have a fixed income to cover your monthly expenses and some budget to partly re-­‐invest in your collection. – Carefully check your sampling and production cost and keep them under control. – Always use a collection plan that contains the structure of the collection, the sizes, the models, the prices... Because a sample collection that doesn’t get sold, is often a deathblow for start-­‐ups. If you’re creating your first collection keep your costs as low as possible and keep personal investments to a minimum. Do as much as possible by yourself, to keep your expenses under control. – Advertising is a bottomless money pit. – As a young designer invest in entering into good and long-­‐term relations with editors, journalists, photographers, stylists and insiders who can help you for a give-­‐away. The impact of these relationships will create more value than you can get from a single ad. Found this with a professional website that supports your creative vision and breaths a clear brand identity. – Focus on growing sales. Revenues from one collection will allow you to create a next collection. – As a start-­‐up, invest your money in people and goods that directly lead to an increase of income. One of the first people you should hire for example, should be someone who can help you out with your sales. Don’t forget your working capital. Not all of your financing should be invested in fixed capital such as sewing machines, stock, expensive fabrics, a car and computers. You also need money to finance the gap between incoming money (from sales, sponsors,...) and outgoing money (rent, collection, production...). Therefore, limit your fixed costs (such as the rent of an atelier) and only think about growing your business when you have a solid basis to start from. Stick to your budget. It is absolutely essential to -­‐ once you’ve thought all these matters through -­‐ calculate and forecast a budget on a monthly base. A good cash plan can be a good start. Without a roadmap, it is easy to lose control of your expenses. PRIVATE RESOURCES
First of all you need to consider how much money you can and are willing to invest in your business. It is always clever to bring in money yourself in order to convince banks and other institutions to (financially) support your business. Start looking for financial partners from the very start, and don’t wait to contact them until after you’ve invested all of your money. Depending on the volume of your financing need, you will be looking for private partners or external funds (e.g loans, venture capital, etc…). START-UP GUIDE | June 2013 © Flanders Fashion Institute
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EXTERNAL FINANCIAL OPPURTUNITIES
Given the difficult financial situation of the fashion industry, it will soon be clear that you will not be able to finance your plans on your own. In this chapter you will be introduced to the various sources of financing. Bear in mind that apart from seed capital, every healthy business needs capital to finance its growth. Furthermore it is wise to opt for a solid financial basis with a reserve (if necessary on the basis of a loan or investment) instead of having to rely on earnings to pay invoices every month. If you want to convince a person or an institution to invest in your project it is crucial to provide them with the correct information: – Introduce yourself; – Introduce your business and plan; – Explain the practicability of your project on the basis of your business plan; – Explain your financial situation. Friends, Fools, Family: The 3 F’s Possibly important to provide you resources are your loyal fans; friends, fools and family. They are often prepared to offer financial support, but don’t make rash decisions. Define clear agreements about pay-­‐back conditions and be honest about risks. The Win-­‐Win loan of the Flemish government (a project of PMV www.pmv.eu) wants to encourage private individuals to put financial resources at the disposal of start-­‐ups. Those who grant a Win-­‐Win loan as a friend, acquaintance or family member, receive an annual tax discount of 2,5% of the amount of the loan and a tax discount of 30% when you are unable to repay the loan. The Win-­‐Win loan makes it easier for young entrepreneurs to find starting capital in the immediate vicinity. Loan Aside from money you put in the business yourself, you can also go to the bank for a loan. However, this will not be easy as a bank asks for securities and guarantees. A banking institution wants to make sure the loan will be repaid with interest. Nevertheless there are some alternatives for start-­‐ups and you can opt for more than one possibility simultaneously. For example it’s possible to receive a loan through a bank and finance another part through a subordinated loan. This principle of combining several resources, is called ‘co-­‐financing’. SME’s that can’t conclude a financing contract with a financial institution due to a lack of sufficient guarantees can opt for a guarantee scheme (also a product of PMV). There are several financial institutions that are certified guarantee holders. Under the terms of a guarantee scheme an enterprise can secure 75% of her agreements by the Flemish government. Venture Capital If you can’t apply for a loan from a bank because the risk is too high or you can’t put sufficient guarantees on the table, you can appeal to a ‘venture capitalist’. An investment like this can take different forms such as a participation in shares, a subordinated loan or a (convertible) loan. Traditionally venture capitalists are private investors (business angels) who try to secure high return through a diverse portfolio of various growth businesses. They take the highest risk as in case of bankruptcy they are the last ones to be paid back. In exchange for putting their money at risk, they forecast to quickly get a good return on investment. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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In Flanders, business angels are united in the Business Angels Network (BAN Vlaanderen). They can be a vital financial link in the growth process of an enterprise. Business angels put their experience and network at the disposal of the young business they invest in. This way companies can increase the pace of their growth and secure their medium and long term future. More info: www.banvlaanderen.be. Given the cashflow difficulties and the rather limited margins the fashion industry faces, the relationship between investors and start-­‐up fashion companies, is rather difficult. Therfore, the government has created some initiatives (Participatiefonds and CultuurInvest) to compensate the lack of investors. Two definitions: – A convertible means that a loan can lateron be exchanged in shares; – A subordinated loan is a loan that will be last in line of obligations to be repaid in case of liquidation. CultuurInvest is also part of Participatiemaatschappij Vlaanderen (PMV www.pmv.eu/eng ). It is an investment fund for cultural and creative projects for which fashion designers can apply for growth financing. CultuurInvest invests with subordinated loans (possibly convertible in shares) or through a capital participation. Generally, CultuurInvest will co-­‐finance with another financial partner. Participation Fund (www.fonds.org/eng) aims at strengthening the own funds of self-­‐employed people, liberal professions and SME’s as well as fighting unemployment. For this purpose it supplies a number of subordinated loans that can be granted to certain SME’s in exchange for favourable conditions. Participatie Fund provides credit through various formulas that can be interesting for fashion designers; a Starter loan (for non-­‐working job-­‐seekers), the ‘Young Self-­‐employed Plan’ (for non-­‐working job-­‐seekers under the age of 30), Initio (for small enterprises that want to obtain a PF-­‐agreement for their investment plans before approaching a bank) and Optimeo (companies active for a minimum of four years). CONTRIBUTIONS AND SUBSIDIES
Unfortunately fashion designers can not apply for specific subsidies or contributions, as they operate within an economic reality. However, the government provides a set of contributions and subsidies for enterprises and SME’s in general. Below you can find a list of the most important ones for designers. Flanders Investment & Trade (FIT) wants to encourage international entrepreneurship in Flanders. The mission consists of two parts: stimulating international entrepreneurship in Flanders on the one hand and attract foreign investments to Flanders on the other hand. FIT foresees tailor-­‐made counseling and (international) advice for Flemish entrepreneurs, the possibility to participate in the FIT action programme and some specific financial support measures. Usually FIT contributes to the expenses of export actions; you can partly recuperate expenses for prospection trips, product documentation in other languages, participation at fashion fairs or niche events,.. More information: www.flandersinvestmentandtrade.be Enclosure 8: Flanders Investment & Trade START-UP GUIDE | June 2013 © Flanders Fashion Institute
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The Agency for Innovation by Science and Technology (IWT – www.iwt.be/english) provides a subsidy for innovative projects. This governmental agency supports innovation in Flanders in various ways; every year IWT distributes a large amount of subsidies to projects of small and big companies, universities,… Furthermore IWT stimulates the transfer of knowledge between academic partners and the business world and manages a widespread Vlaams Innovatie Netwerk (VIN – www.innovatienetwerk.be ), a platform that makes sure you get in contact with the right partners. There are frequently contests for young entrepreneurs that can provide a platform on the one hand and a financial reimbursement on the other hand. Two examples are Bizidee (www.bizidee.be) for Flemish entrepreneurs and Enterprize (www.enterprize.be) is a national business plan contest. The selection for these contests is mainly based on the business plan and its practicability. There are a number of international contests for young fashion designers which can hold an important financial prize as well as it implies (free) communication for you as a designer. Here the selection is based on creative talent. The careers of some influential designers knew a kick-­‐start by winning one of these prizes. – Festival International de Mode et Photographie in Hyères (www.villanoailles-­‐hyeres.com) – Andam Prize (andam.fr) – International Talent Support (ITS -­‐ www.itsweb.org) – H&M and Mango organise a design contest with important financial awards every year. Enterprises that invest themselves can also qualify for certain measures such as a tax benefit for their investment and the ‘deduction of venture capital’. There are several formulas to obtain support when hiring people. You can ask your employers’ social-­‐accounting secretariat to advice you. Generally there are support measures when hiring: – Young employees; – Older employees; – Your first employee; – Additional staff for scientific research and development (R&D); – Long-­‐term job-­‐seekers; – Additional staff on low pay; – People with a disability. An enterprise can get up to €15 000 of subsidies when taking training with the purpose of improving business performance, asking for (strategic) advice, advice on international entrepreneurship and technology exploration at an acknowledged service provider through the measure KMO-­‐portefeuille. More information: www.agentschapondernemen.be/themas/kmo-­‐portefeuille Companies in Flanders that make an effort to take energy and environmental measures can also claim some contributions. There is also non-­‐financial support, such as free (or almost free) information and training available through various initiatives. Flanders Fashion Institute for example frequently organises seminars for young designers. Other organisations such as Unizo, Voka, Deloitte,… also organise training courses for young entrepreneurs on a regular basis. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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11_SPECIALIST LITERATURE
Library: Antwerp MoMu library Nationalestraat 28 B-­‐2000 Antwerp Tel. +32 3 470 27 97 Speciality websites: – www.fashionunited.com/executive – www.linkmag.nl – www.modeflash.be – www.modint.nl/engels – www.newstylefashion.com – www.texpress.nl – www.textilia.nl – www.vakbladmannenmode.nl – www.vakbladvrouwenmode.nl – www.wwd.com – www.businessoffashion.com – www.febeltex.be – www.style.com START-UP GUIDE | June 2013 © Flanders Fashion Institute
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12_SOURCES
Websites: – www.ffi.be – www.gatewaytojapan.org – www.creamoda.be – www.pmv.eu/nl/diensten – www.flanderstrade.be – www.belgianchambers.be – www.unizo.be – www.evetp.eu – www.economie.fgov.be – www.belgium.be/nl/werk/arbeidscontract/soorten_
– www.kvk.nl contracten – www.iwt.be – www.rsvz-­‐inasti.fgov.be/nl/selfemployed/index.htm – www.ivoc.be – www.beangels.eu – www.rsvz-­‐inasti.fgov.be – www.textilescommittee.gov.in/visual.htm – www.agentschapondernemen.be – www.fonds.org – www.belgium.be/nl/economie/onder
– www.banvlaanderen.be – Internetsites vakgebied: neming/ – oprichting/financieel_plan – www.fashionunited.nl/vakblad – www.vlaanderen.be – www.linkmag.nl – www.bizidee.be – www.modeflash.be/nl/ – www.pmv-­‐kmo.be – www.modint.nl – www.enterprize.be – www.newstylefashion.com – www.fiscus.fgov.be – www.texpress.nl – www.designvlaanderen.be – www.textilia.nl – www.vdab.be – www.vakbladmannenmode.nl – www.rva.be – www.vakbladvrouwenmode.nl – www.cevora.be – www.wwd.com – Beaweb.be – www.businessoffashion.com – www.vito.be – www.febeltex.be – www.flanderstrade.be – www.style.com – www.prinsalbertfonds.be Other – Creamoda – www.princealbertfund.be – Jobat, Carrière maker – Valkuilen voor een startende ondernemer. Tien fouten die u absoluut moet vermijden. New business 2011 – Checklist: oprichting NV/BVBA New Business 2011 – A guide for start-­‐up fashion businesses in the UK. Voor NESTA door Centre for Fashion Enterprise – Reader Patronen Amsterdam Fashion Institute, Gonneke Kieboom – Seminarie FFI en Olswang advocaten Books – The Fashion Survival Guide, Start and Run Your Own Fashion Business, Mary Gehlar, July 2008, Kaplan Publishing START-UP GUIDE | June 2013 © Flanders Fashion Institute
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ENCLOSURES
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ENCLOSURE 1:
EXAMPLE APPLICATION
LETTER
Annie van Dijk Fredericqstraat 49 2000 Antwerp Mr Marcel Roes Product Manager Maymay Bergenseweg 201 2000 Antwerp Reference 56.560/Jobat Dear Mr Roes rd
I am contacting you with regard to the advertisement in Jobat from August 23 which states that Maymay has an open position for a product manager. During my career I have passed through several aspects of product managing. At Scabal I started out as an assistant to the technical director. In this position I helped develop a quality control system. After this I was promoted to product manager; a position I held for three years and took a lot of pleasure in. I feel that the time has come to broaden my horizon and start a new chapter. As I have several years of experience in confection and therefore know which direction to take as a production manager, I believe this position is just right for me. I would very much like to further discuss this letter in person. Yours sincerely, Annie van Dijk START-UP GUIDE | June 2013 © Flanders Fashion Institute
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ENCLOSURE 2:
CURRICULUM VITAE
Name:
Annie van Dijk
Address:
Fredericqstraat 49
Postal code and city:
2000 Antwerp
Email:
[email protected]
Telephone number:
+32 (0)56 16 16 98
Mobile number:
+32 (0)471 161 191
Date of birth:
19 December 1979
Place of birth:
Ghent, Belgium
Nationality
Belgian
(passport photo) Experience
2007-Present
Product manager confection at Scabal
Responsible for a team of six people
Organisation/planning/communication between creation department and technical
department, carrying through prototypes and collection pieces, analysing and improving
2005-2007
Promotion to product manager at Sophia
Same tasks as before in addition to collection development, communication between
production (DE) and parent company BXL, organisation of assignments in clothing
contracting firms
2000-2004
Technical director assistant at Sophia
Assistance at reforming quality control system, product development, handling and
optimizing returns/complaints
Education
1997-2000
Confection degree at HoGent
Graduated cum laude
Linguistic skills
Mother tongue:
Dutch
Fluent:
English
Fluent:
French
Fluent:
German
Interests & hobbies
Architecture; renovating; decorating (when I was 20 I renovated a complete apartment on
my own and last year my partner and I renovated a town house); cooking; exercising:
skiing, running, spinning and other group sports; backpacking; roadtripping; …
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ENCLOSURE 3: OVERVIEW
OF WINDOW OFFICES FOR
BUSINESSES
Source: http://economie.fgov.be/nl/ondernemingen/leven_onderneming/oprichting/ondernemingsloket/ The list of the ten established ‘ondernemingsloketten’ are written down below. Click on the link to pay a visit to one’s website. NAME
HEADQUARTERS
ACERTA ONDERNEMINGSLOKET vzw
Buro & Design Center, Heizel Esplanade
Postbus 65 - 1020 Brussels
Website:http://www.acerta.be
XERIUS ONDERNEMINGSLOKET vzw
Koningsstraat 269
1030 Brussels
Website: http://www.xerius.be
EUNOMIA vzw
Kolonel Bourgstraat 113
1140 Brussels
Adm. zetel: Oudenaardsesteenweg 7 - 9000 Gent
Website: http://www.eunomia.be
FORMALIS vzw
Lombardstraat 34-42
1000 Brussels
Website: http://www.formalis.be/
SECUREX ONDERNEMINGSLOKET - GO-START vzw
Tervurenlaan 43
1040 Brussels
Website: http://www.go-start.be
H.D.P. ONDERNEMINGSLOKET vzw
Koningstraat 196
1210 Brussels
Website: http://www.hdp.be
PARTENA ONDERNEMINGSLOKET vzw
Anspachlaan 1
1000 Brussels
Website: www.ondernemingsloket.partena.be
ZENITO ONDERNEMINGSLOKET vzw
Spastraat 8
1000 Brussels
Website: http://www.zenito.be/
U.C.M. ONDERNEMINGSLOKET vzw
Adolphe Lacomblélaan 29
1030 Brussels
Website: http://www.ucm.be
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ENCLOSURE 4:
LIST OF SOCIAL AGENCIES
FOR ARTISTS
Private employment services in the Flemish Region Recognized employment agencies for artists Actief Interim
Randstad Belgium
Klaverbladstraat 7 A
Buro & Design Center - Heizel Esplanade 71
3560 Lummen
1020 Brussels
Adecco Personnel Services
RITMO INTERIM
Noordkustlaan 8
Godefriduskaai 18 32
1702 Dilbeek
2000 Antwerp
ASAP.BE
Société Wallonne de Services de Placement Payants
Henry Fordlaan 47
Boulevard Zoé Drion 25
3600 Genk
6000 Charleroi
Daoust Interim
Start People
Louizapoortgalerij 203
Frankrijklei 101
1050 Brussels
2000 Antwerp
Flexpoint BVBA
Start People Abroad
Kerkplein 8
Frankrijklei 101
3250 Zonhoven
2000 Antwerp
Interpass
Tempo-Team
Iddergemsesteenweg 77 C
Square Marie Curie 50 2
9450 Haaltert
1070 Brussels
Jobconnections
Tentoo Payroll Services
Diestsestraat 114
Ikaroslaan 14
3000 Leuven
1930 Zaventem
Manpower Belgium
T-Groep
Louizalaan 523
Stationsstraat 120
1050 Brussels
2800 Mechelen
MERVEILLE PLUS INTERIM
The Crew Flex
Rue de la Liberté 31
Frankrijklei 101
7950 Chièvres
2000 Antwerp
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ENCLOSURE 5: CALCULATION
OF THE COST PRICE
Calculation of the cost price (costing) Column D, E flexible Measure
Quantity
Price per
metre/piece
Fabrics
Smallwares
Labels
Production
costs
Packaging
costs
Transport
costs
Total price
%%
Fabric 1
Fabric 2
Lining
Adhesive lining
Pocketing
Total fabrics
Button
Zip
Thread 1
Thread 2
Band
Belt
Yokes
Badges, applications
Extra
Extra
Total smallwares
Brand label
Care label
Composition label
Hang tags
Total labels
Production and labour
costs
per
per
per
per
per
per
per
per
per
per
per
per
per
per
per
per
m
m
m
m
m
m
piece
piece
piece
piece
piece
piece
piece
piece
piece
piece
2
1
1
1
1
5,20
0,50
1,50
1,00
4,00
1
1
1
1
2
1
1
1
0
0
0,10
0,10
0,10
0,10
0,10
0,10
0,10
0,10
0,10
0,50
per
per
per
per
piece
piece
piece
piece
1
1
1
1
0,05
0,05
0,05
0,05
1,05
0,05
0,05
0,05
0,05
0,20
per piece
1
30
30
Packaging costs
per piece
1
0,20
0,20
Transport
per piece
1
0,10
0,10
Cost price
Selling price
Retail price
Order extra
margins
2,7
0,01
0,01
0,01
0,01
0,01
0,01
0,01
0,01
10,40
0,50
1,50
1,00
4,00
17,40
0,11
0,11
0,11
0,11
0,22
0,11
0,11
0,11
48,95
97,90
264,33
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ENCLOSURE 6: PRICE
STRATEGY
– Average prices (per product category/per piece). – Average price of the complete collection depends on the composition of the collection. – Consider minimal and maximal margins. The table gives an indication of the retail price (consumer price). – If your retail price is too high for your ‘ideal’ end consumer, try lowering your production price (for example by designing more production friendly) rather than losing margin (your income). – You can also use this schedule to study and evaluate the ratios of previous collections. Production price
Showroom price =
Retail price =
production price x 2
showroom price x 2
Competitor price
Accessories
Trousers
Jacket
Jeans
Dress
Lingerie
Skirt
Shoes
Bags
Sweater
T-shirt
...
Special pieces for the
press
Special pieces for
galleries
...
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ENCLOSURE 7: EXAMPLE OF
ORDER FORM AND SALE
CONDITIONS
ORDER CONFIRMATION AW 2011-­‐2012 NAME COMPANY ADDRESS COMPANY TEL FAX E-­‐MAIL WEBSITE VAT NUMBER BANK DETAILS (IBAN/BIC) CUSTOMER ADDRESS DELIVERY ADDRESS ACCOUNT ADDRESS NAME CLIENT NAME CLIENT NAME CLIENT ADDRESS CLIENT ADDRESS CLIENT ADDRESS CLIENT CONFIRMATION DATE VAT NO CUSTOMER REFERENCE ORDER REFERENCE CONTACT PERSON PAYMENT CONDITIONS SHIPPING TERMS DELIVERY PERIOD CONFIRMATION APPROVED BY…………….BUYER’S SIGNATURE START-UP GUIDE | June 2013 © Flanders Fashion Institute
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Product
ID
Description
Material
Colour
Ref.
Code
34
36
38
40
42
44
Total
quantity
Unit price
Total
Total
price
Total
GENERAL SALES CONDITIONS
In the present general sale conditions, the word “Company” designates: [name Company, including physical person]. Any “acceptance”,” confirmation” and similar action of the Company referred to herein is only binding on it provided that it has been issued in writing by one or several persons legally authorised to act on behalf of the Company. Application The present general sale conditions apply to any sale or delivery made by the Company, to the exclusion of any general or specific conditions communicated at any time by the purchaser (hereafter the “Buyer”), except for any derogation accepted by the Company’s written and express consent. Such derogation will only apply to the specific sale or delivery for which it has been granted. By making any order, the Buyer acknowledges the present general sale conditions and irrevocably agrees to be bound by them. The Buyer understands that certain styles and/for sizes and/for colours may be unavailable. The Buyer will accept all available styles, sizes and colours. Quotations and acceptance of order All the company’s quotations are non-­‐binding, except if stipulated to the contrary by an express and written statement of the Company. The Company will only be bound by an order upon its written confirmation, or after it has commenced performance. Prices on an order are based on recent agreements for finished garments, fabric and supplies, and on present labour costs. Should prices for any items be increased, the prices on this order will be subject to increase. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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Delivery All sales and deliveries are made [EXW (“Ex Works”)] (Incoterms 2000). The delivery times indicated are non-­‐binding on the Company, and are only given as an estimate. No delay in delivery may lead to the cancellation of the sale by or payment of damages to the Buyer, except in case of willful delay. The Company is entitled to perform partial deliveries. In case of non-­‐delivery of products, advances that may have been paid by the Buyer will be reimbursed by the Company, without any additional interests or other compensation. Retention of title The products supplied by the Company remain its exclusive property until payment of the price in full by the Buyer. In case of non-­‐payment upon the due date by the Buyer, the Company will automatically be entitled to claim the products back, ipso jure and at the Buyer’s expense. Furthermore, the Company will be entitled in such case, upon the giving notice by registered mail but without any other formality or judicial intervention, and without prejudice to its right to claim damages, to cancel the sale at the detriment of the Buyer. If the Buyer resells the delivered products before payment of the full price owed to the Company, the Buyer’s claim on its customer as a result of this sale will be pledged to the Company as security for the payment of the price owed to the latter. Intellectual Property Rights The Buyer acknowledges and agrees that all existing and future Intellectual Property Rights (such as, but not limited to copyrights, design and models, trademarks, etc.) that relate to or subsist or reside in the products, are only owned by the Company. The Company’s Intellectual Property Rights shall at all time remain the property of the Company. The Buyer is not allowed to change the products delivered in total or in part or to give these a different name or packaging, unless otherwise agreed in writing. Any unauthorised use of the Company’s Intellectual Property Rights shall be punished according to the intellectual property laws in vigour. Complaints In order to be valid, any complaint regarding a defect which was or should reasonably have been noticed at the time of delivery, must be notified within fourteen (14) days after delivery of the products. Such complaint will only be valid if the products have remained in the state they were at delivery. No products may be returned by the Buyer, without the Company’s prior express and written consent. The Company will not issue credit for any allowances, deductions, or materials returned unless Buyer obtains the Company’s written consent of same within (14) days of receipt of the products. Warranty The Company’s warranty is limited to replacing the concerned products and, if this is not possible, restitution of the invoiced price. The Company is under no circumstances liable for indirect damages, whether general or specific, and whatever their nature, suffered by the Buyer Force majeure: The Company is not liable for any delay in the performance of or failure to perform its obligations arising from any event beyond its normal control, including, inter alia, interruptions in production, difficulties in supply, or shortages of raw material, labour, energy or transport, or delays in transportation, strikes, lock-­‐outs, work interruptions or any other collective labour disputes affecting either the Company itself or its suppliers, whether or not such events are foreseeable. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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Price and payment Invoices are payable 30% on the date of the order confirmation, 70% 5 days before delivery. The Company shall be entitled to demand a surety of payment before delivery. Deviating terms and conditions can be agreed upon express and written statement of the Company. To be valid, any complaint regarding invoices will have to be notified by registered mail and formulated in detail within three (3) days after receipt of the invoice. No ground, such as e.g. the filing of a complaint regarding the delivered products, shall entitle the Buyer to withhold its payment. Any sum remaining due after the date of payment shall, ipso jure and without notice, produce an interest of one (1) percent per month from the date of issuance of the invoice, each month having commenced being regarded as a fully expired. In case of total or partial non-­‐payment of an invoice upon due date, the Buyer shall, ipso jure and without notice, owe an indemnity of ten (10) percent of the amount remaining due, with a minimum of [………] EUR. If an invoice is not fully paid upon its due date or if the Buyer does not fulfil any of its obligations under the contract, the Company shall be entitled, ipso jure and without notice or other formality, to postpone performance of its obligations towards the Buyer under any agreement, to terminate any agreement concluded with the Buyer with immediate effect, to claim immediate payment of all outstanding claims, including those not yet due, or to refuse performance except against cash payment, notwithstanding any prior agreement and without prejudice to any other remedies which could be applied by the Company. Failure to take immediate action against any breach or default by the Buyer may under no circumstances be construed as a waiver by the Company of its rights to act against such breach of default at a later point in time. Severability The fact that one of the clauses of these general conditions is declared null and void shall not affect the validity of the other clauses. Competence and applicable law All agreements concluded with the Company are governed by Belgian Law, to the exclusion of the provisions of the United Nations Convention on the International Sale of Products. The Company and the Buyer (“the Parties”) agree to use all reasonable efforts to reach a fair settlement of any disputes relating to their agreements. In the event of any dispute, difference, controversy or claim arising out of in connection with to their agreements, the parties will first attempt to settle such dispute amicably. If the parties cannot agree on the resolution of any dispute, they agree to appoint a qualified neutral third party with expertise in the area of concern (hereinafter “Mediator”). Such Mediator shall be consulted to mediate and make recommendations as to the resolution of the matter in a timely manner. The costs of such mediation shall be divided equally between the Parties. If the Parties have not reached a settlement of such dispute, the dispute shall finally be settled by arbitration in accordance with the Rules of Arbitration of Cepani (Centre Belge d’Arbitrage et de Mediation – Belgian Center for Arbitration and Mediation) as presently in force. The place of arbitration shall be Brussels and the language to be used in the arbitral procedure shall be [English]. The Parties agree to call upon the services of the Belgian Center for Mediation and Arbitration for both mediation or arbitration (www.cepani.be). If Cepani’s decision is not satisfactory to one of the Parties, they still can submit their disputes to the Courts, provided that these disputes shall be submitted to the exclusive jurisdiction of the [Courts of Brussels]. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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ENCLOSURE 8:
FLANDERS INVESTMENT &
TRADE
What can FIT do for fashion companies in Flanders? Tailor-­‐made advice and guidance Flemish fashion entrepreneurs can approach provincial FIT offices for information and advice (general or tailor-­‐made) on international business. Taking part in operations FIT offers Flemish entrepreneurs an ambitious operation programme with a balanced mix of actions. These can be located in Flanders as wel as abroad. FIT will take over the preparations so that entrepreneurs can fully concentrate on their businesses. At this moment, FIT does not offer specific fashion related operation programmes. However, the multi-­‐sectoral programmes of FIT do offer a number of possibilities for fashion companies. On the basis of the profile of your ideal conversation partners, the Flemish Economy Representative in the country/area of your choice can propose a specific tailor-­‐made meeting programme. Financial support FIT makes it possible for a representative to recuperate half of the travel and accommodation expenses of a prospection trip to a new market outside the European Economic Area (EEA). This is calculated on the basis of fixed sums and applies a maximum of 3 trips in 5 years to the same country. If you produce non-­‐native product documentation (e.g. brochure, cd-­‐rom, website), you can recuperate 50% of the (external) costs (with a year maximum of 7.500 euro) through FIT. When you invite buyers from countries outside the EEA to Flanders, you can recuperate up to 50% of the expenses (on the basis of fixed sums) with a maximum of 5 invitations a year. Travel and accommodation expenses as part of a participation in a fashion trade fair outside the EEA also qualify for a subsidy. Same goes for the costs with regard to the participation or organisation of a niche event. In both cases there is a maximum contribution of 50% of the expenses, for a maximum of two actions a year (trade fair and niche event together). One particular event can qualify up to 4 times in 8 years. As regards trade fair participation, you can recuperate the stand price + 25% for an individual participation + 75% for a collective participation, with a maximum of 10 000 euro inside the EEA and 15 000 euro outside the EEA. Apropos niche events, all relevant expenses qualify for a recuperation; with a maximum of 6 000 euro inside of the EEA and 10 000 euro outside the EEA. For advice on internationalisation, Flemish fashion entrepreneurs address acknowledged advisors. This procedure is in writing and needs to consist of an analysis of the problem formulation, the actual advice (solutions and valuable suggestions) and an implementation plan. As for the expenses, you can receive a subsidy of 50% of the expenses, with a maximum of 5 000 euro. START-UP GUIDE | June 2013 © Flanders Fashion Institute
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