Having graduated with a degree in design and worked at a company, Nguyen Ngoc Anh (Thanh Xuan, Hanoi) decided to quit her job to start her own business and build her own fashion brand.

For her, fashion is not only a business, but also a long-cherished dream. She wants to build a brand with its own mark so that young people can express their personality. That is why she poured all her faith and nearly 1 billion VND in investment capital to make her dream come true.

At the beginning of its opening, Ms. Anh's store attracted a number of curious visitors, and the initial revenue was quite stable. However, after a short "honeymoon" period, the number of customers began to decline. Monthly operating costs, including rent, staff salaries, electricity, water, and marketing... are estimated at about 40-50 million VND per month.

Meanwhile, the deposit of 150 million VND for the premises, the cost of decorating the store of 100-150 million VND and the initial shipment of 300-400 million VND have consumed most of the capital. These fixed costs cannot be recovered immediately.

Sales revenue was not enough to cover costs. Ms. Anh had to use part of her reserve capital to maintain operations, but this money gradually ran out, pushing the brand into a deadlock.

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Many young people bet on starting a business in the fashion industry. Illustration: Nguyen Hue

After 10 months of operation, revenue from stores and online channels only reached about 70-90 million VND per month, while total operating costs exceeded 500 million VND. Inventory, worth about 200 million VND, was almost illiquid due to outdated and unattractive designs.

Ms. Anh also borrowed more money from relatives to maintain the operation. The total accumulated loss is estimated to be up to 600-700 million VND, putting her at risk of closing down and losing all her initial capital.

Talking about the reasons for the failure, Ms. Anh said that the store positioned its products in the mid-range segment, priced around 100,000-300,000 VND, to attract Gen Z and Millennials. But the fashion market is dominated by low-cost brands and giant e-commerce platforms such as Shopee and Lazada. These competitors have the advantage of large-scale production, lean operations and quick design updates. Young customers prioritize affordable prices and variety, making Ms. Anh's products, despite being creative, still considered "expensive".

Realizing that traditional channels were at a standstill, Ms. Anh switched to online sales. She invested in taking product photos with creative concepts, livestreaming on TikTok, Facebook, and promoting content on Instagram. However, fierce competition made it easy for her content to be lost among thousands of online stores.

According to Ms. Anh, another mistake was the lack of a clear financial management system from the beginning. Revenue and expenses were only roughly monitored, without specific reports. In particular, she did not plan cash flow. In particular, not separating personal finances from business finances, causing the financial situation to become chaotic.

Mr. Pham The Anh (fashion industry expert) said that starting a business in the fashion industry requires more careful preparation than just passion and capital.

Before you start, do in-depth market research to identify your customer segments and position your product. Cash flow management is vital, prioritize a lean model, reduce fixed costs such as large premises, and make the most of digital platforms to reach customers at low cost.

Most importantly, build brand trust through product quality and consistent communication strategy. A brand failure is not the end of the world, but an opportunity to re-evaluate and adjust strategy, provided the founder is willing to learn and innovate.

(Names of characters in the article have been changed)

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Source: https://vietnamnet.vn/bo-viec-cong-ty-doc-gan-1-ty-khoi-nghiep-thoi-trang-giac-mo-thanh-ac-mong-2442852.html