http://www.lni.wa.gov/Safety/Research/Files/Wmsd/Wholesale_summary_FINAL.

pdf

-washington state

Wholesale and Retail Trade A Summary of Research Study Findings

SEPTEMBER 2015

AUTHORS Ninica Howard, Principal Investigator

Stephen Bao, Co-Investigator

Jia-Hua Lin, Senior Researcher

Daniel Hunter, Research Investigator

Alysa Haas, Research Analyst

https://www.ibisworld.co.uk/industry-trends/market-research-reports/wholesale-retail-trade/except-
of-motor-vehicles-motorcycles/clothing-retailing.html

- Clothing retailing
- Date Published: May 2018

http://www.valueline.com/Stocks/Industries/Industry_Overview__Apparel.aspx#.W20FjujwbDc

- Industry overview: apparel

https://smallbusiness.chron.com/clothing-wholesale-retail-markets-work-74810.html

by Victoria Duff; Updated June 30, 2017

References  (2)
 Small Business Administration: Tips for Finding and Working with Wholesale Suppliers
 Business Portal of India: Wholesalers and Retailers
Resources  (2)
 Morebusiness.com: Sample Retail Clothing Business Plan
 Launch Grow Joy: How to Sell to Retail Stores

https://smallbusiness.chron.com/clothing-distribution-deal-work-22041.html

- How does a clothing distribution deal work?

References  (3)
 New Era Consulting.com; Avoiding The 10 Top Mistakes With Distributor Contracts;
Glen Balzer
 The MLM Attorney; Revised FTC Endorsement Guidelines: Part 1 (Master Distributors);
Kevin Thompson; June 2010
 Prime Time Clothing: About Us
Resources  (1)
 Onecle.com: Sample Business Contracts; Distributor Contract

References  (3)
 Power Home Biz: How to Market Your Clothing Designs to Local Stores
 Hoovers: Clothing Stores: Industry Overview
 Clothing Line Help: Clothing Line Production: Getting It Made

About the Author

Lisa McQuerrey has been a business writer since 1987. In 1994, she launched a full-service
marketing and communications firm. McQuerrey's work has garnered awards from the U.S. Small
Business Administration, the International Association of Business Communicators and the
Associated Press. She is also the author of several nonfiction trade publications, and, in 2012, had
her first young-adult novel published by Glass Page Books.

About the Author

Based in Chicago, Gail Cohen has been a professional writer for more than 30 years. She has
authored and co-authored 14 books and penned hundreds of articles in consumer and trade
publications, including the Illinois-based "Daily Herald" newspaper. Her newest book, "The
Christmas Quilt," was published in December 2011.

What is the Clothing Retailing Industry?

Clothing retailers source clothing from wholesalers or manufacturers and sell them to
consumers. Most industry participants sell goods from one or more retail stores and
often operate an online portal as well. The industry does not include enterprises that
only operate online. Although accessory sales are covered, shoe sales are not.
Industry Products
 Women's clothing
 Men's clothing
 Children's and infants' clothing
 Accessories
 Delivery options
Industry Activities
 Retailing women's clothing
 Retailing men's clothing
 Retailing children's and infants' clothing
 Retailing accessories and other items

Additional Insights for the Clothing

Retailing Industry
IBISWorld identifies 250 Key Success Factors for a business.The most important for the
Clothing Retailing Industry are
 Ability to pass on cost increases
 Attractive product presentation
 Proximity to key markets
IBISWorld analysts also discuss how external factors such as Real household
disposable income and Demand from department stores in the Clothing Retailing
industry impact industry performance.

Industry Overview: Apparel

 
The Apparel Industry consists of companies that design and sell clothing, footwear and accessories.
Product categories include everything from basics, such as underwear, to luxury items, for example,
cashmere sweaters and alligator-skin handbags. Traditionally, apparel companies were wholesalers,
selling large quantities of goods to retailers, which then marked-up items and sold them to consumers at a
profit. However, it's become more difficult to draw a line between wholesalers and retailers; most apparel
companies now have both types of operations.
Wholesale Business
Wholesale business is what separates companies in Value Line’s Apparel Industry from those in our
Retail (Special Lines) category. Apparel companies design and produce/source items that they sell to
retailers, including department stores, specialty shops and discounters. Often, a company owns licenses
to manufacture goods under particular brand names, and will market and advertise these lines. One
license can cover many products. In some instances, an apparel company may only have the rights to
produce specific items under a brand, such as ties and shirts, while excluding other product lines, for
instance pants or sleepwear. Production is often outsourced to developing countries, where labor costs
are inexpensive, relative to those of the United States and Europe. The wholesale market is seasonal.
Retailers stock up on merchandise before shoppers hit the stores during the peak back-to-school and
holiday periods.
Brand names, in particular familiar offerings with a good reputation for quality, style or value, are popular
among shoppers. A clothing company possessing a broad line-up of well-known brands has a competitive
advantage over its peers. This is not always the case, however. In tough economic times, consumers
might turn to similar private-label goods to save money. Private-label goods are found in department
stores and discount chains. Though they are less expensive than branded items, such goods are often
more profitable for the seller. Brand-name items and private-label goods compete against each other for
shelf space throughout the business cycle.
Because of the seasonal nature of the wholesale market, it's better to compare sales on a year-to-year,
rather than sequential-quarter, basis. Gross and operating margins are the best gauges of a company's
health. Sales volume, supply chain efficiency, sourcing costs, and selling, general and administrative
(SG&A) expenses determine profitability.
Retail Operations
There are a number of reasons why companies in the Apparel Industry establish retail divisions. Having
stores dedicated to a single brand gives a company control over a line's image and identity. Apparel
companies relinquish some control over branding and merchandising at department stores, and their
influence is diluted further at the boutique level. Dedicated retail stores allow a company to highlight its
own merchandise, without worrying about competing labels.
Retail stores are typically more profitable than their wholesale brethren. By selling its own merchandise at
retail, an apparel company can cut out the middle man and increase profits. However, this strategy can be
risky. Instead of simply designing and producing clothes, and filling wholesale orders, companies with
retail operations have the added burden of finding store locations with good potential and managing
inventory, while avoiding big markdowns.
The Internet is another important platform for retailers, especially since consumers are increasingly Web-
savvy and have access virtually anywhere. Shoppers want to quickly find what they are looking for online,
and demand fast processing and shipping. Direct sales via the Internet can be a boon to a company.
These sales do not entail expensive storefronts and related staffing and, thus, are more profitable than
traditional business.
Apparel sales at the retail level tend to be highly seasonal, with the majority of revenue booked during the
holiday and back-to-school periods. Industry analysts review total year-to-year sales to identify trends.
Notably, market watchers focus on "comparable-store" sales, which indicate the year-to-year performance
of locations open for a year or more. Sales-per-square-foot is another important metric that measures
how efficiently a retailer utilizes its floor space.
As with wholesalers, the success of retailers is visible in their reported gross and operating margins.
Retail margins are influenced by several factors, including markdowns and promotions, and SG&A
expenses. Product mix also plays a role in determining profitability. For instance, a weighting toward
accessories is favorable, thanks to their high margins, since accessories' one-size-fits-all nature involves
lower costs than do fitted clothes.
Investment Considerations
The Apparel Industry is fragmented and highly competitive. There are a number of major players, but
there are also countless niche stores and private companies that cater to specific demographics. Too,
general merchandisers and foreign companies bring more competition to the sector. Consequently,
companies in the Apparel Industry need to be nimble and highly efficient in order to survive. Having the
right product is also essential; fashion trends change frequently, and companies need to adapt to varying
consumer tastes quickly.
Apparel stocks are economically sensitive. Although clothing is a basic need, people have wide discretion as to when
they update their wardrobes and how much they spend. When times are good, apparel sales are usually brisk.
However, during periods of economic uncertainty and contraction, clothing is an area where people can easily trim
outlays.

 
 
 How the Clothing Wholesale & Retail Markets Work
by Victoria Duff; Updated June 30, 2017

Related Articles
 1Start a Clothing Business With Buying Wholesale
 2Start a Clothing Business at Home
 3Get Wholesale Clothing for Retail Sales
 4Open an Online Clothing Boutique

Whether you are planning to open a retail clothing store or create your own line of
clothing, you will find the garment industry is many-layered and diverse. At every stage
of manufacture and distribution there is usually a wholesaler, but it is also sometimes
possible to buy directly from the manufacturer, or a liquidator, which can result in a
much lower cost. If you are selling your own line, you can distribute directly to retailers
or use wholesale distributors.

Textile Mills

The textile mill is a good place to start learning about how a product gets to the retail
store. The mill sells textiles to a manufacturer either directly or through a textile broker
– a textile wholesaler who supplies sewing shops, jobbers and yardage stores.
Sometimes a brand-name designer commissions or selects textiles from a mill and
either contracts directly with sewing shops or manufactures the clothes in-house. The
larger the brand-name clothing line, the more likely it has contacts at textile mills that
produce specialty textiles on order. If you want to carry designer brands in your store,
you will purchase your inventory either directly from the designer-manufacturer or from
a wholesale distributor handling that and other designer lines.
Sewing Shops, Jobbers and Manufacturers

Sewing shops cut the textiles according to patterns and assemble the garments. Jobbers
sometimes operate sewing shops but usually perform finish work such as embroidery or
embellishment, add belts or other accessories, and prepare the garment for shipping.
Name brands buy the largest quantities and get the lowest piece prices. It is often more
economical to order more units than they can sell in order to get the lowest price. Their
extra units are called overstock and are sold through factory stores, overstock
liquidators or wholesale distributors. When you visit the Lower East Side in New York or
the fashion district in Los Angeles, the wholesale stores open to the public on weekends
are the jobbers or wholesale distributors selling overstocks directly to the public.

Wholesale Distributors

Wholesale distributors are the middlemen that take their cut for arranging transactions.
A garment price can represent several layers of wholesale distributors, particularly if it
is manufactured in a foreign country and imported into the United States. In that case,
the importer buys from a broker or wholesaler in the foreign country and distributes to
retail stores or sells to wholesale distributors in the United States. Some importers buy
directly from sewing shops or jobbers overseas and distribute to retail stores, cutting
out at least one layer of wholesale distribution.

Retail Stores

Small retail stores, ones that don't have enough business to buy in volume, purchase
their goods from wholesale distributors representing the brands or buy from importers,
jobbers and overstock liquidators. Large national retail chains buy directly from the
manufacturer, which may be the design house or a contract manufacturer that operates
its own sewing shops and finishing to custom-produce garments for the retail chain. A
good place to develop a better understanding of the complicated garment market is the
MAGIC Market Week trade show in Las Vegas every year. You will find every level of
manufacturer, wholesaler and name brand in the apparel, shoes and accessories
industries at this show, and it is a good place to buy inventory for your store or sell your
own line of garments.
 How Does a Clothing Distribution Deal Work?
by Gail Cohen

Related Articles
 1Get Clothing Distributed to Major Department Stores
 2How the Clothing Wholesale & Retail Markets Work
 3Start a Clothing Business With Buying Wholesale
 4Become a Distributor of Retail Women's Apparel
The layers of commerce in a free enterprise system are complex, but since they’re at
the heart of the U.S. business model, your desire to cut a distribution deal will be easier
to understand if you see the whole picture. Assuming you haven’t the time to call on
every retailer on the planet to pitch your clothing line or collection, cutting a deal with
clothing distributors can be more than just a way to become a successful small
business; it can free you up to do what you do best: work on clothing.
Set up a Business
Before you negotiate with distributors, you need a business structure. Give your
clothing company a name; obtain a tax ID number, business license or permit; and
carve out a work area that allows you to handle the bureaucratic aspects of your
enterprise as efficiently as your clothing tasks. Distributors want to know that they’re
cutting deals with people who mean business. Show your seriousness of purpose by
creating an intelligent business model.

Do Your Homework

The right clothing distribution deal means everyone profits, so investigate competitor
markup deals so you know what you’re talking about when you find one or more
distributors. In a typical producer/distributor/retail relationship, the designer estimates
material costs and time and sets a garment base price. The distributor adds a markup
and the retailer follows suit. That’s a lot of markups to get clothing to shoppers, which is
why applying due diligence to computing can help you track final pricing, so garments
aren’t overpriced when they reach retailer stock.

Contract With Distributors

The contract you sign with your clothing distributor can mean the difference between a
smooth relationship and one fraught with problems, so use contract language that’s
comprehensive and ironclad (see Resources). Once the contract is drafted, decide on
the type of distributor you prefer. Sign an exclusive relationship contract -- a distributor
with no other clients who will spend all of her time marketing your clothing -- or choose
a multi-line distributor. He may charge you less, but if he’s making a fortune on another
client’s clothing, your clothes could get short shrift in favor of his cash cow’s popularity.
Protect yourself with a short-term contract just in case things don’t work out. You
always can renew for a longer period.

Put Everything in Writing

Your deal with clothing distributors may be sealed with a handshake and promise to
uphold the working relationship, but business can be tricky -- especially when money is
involved. For that reason, develop documents that record, track and tally every fiscal
arrangement you make when you cut deals with distributors. Include agreed-upon non-
disclosure language so proprietary clothing designs don’t inadvertently wind up in the
hands of competitors. Outline negotiated markups and stipulate a payment schedule,
such as quarterly, per shipment, monthly, etc.
 Review Deals Periodically

Your agreements to allow one or more clothing distributor the right to handle your
clothing should be vetted by an attorney at the onset of each deal, but you also should
review those contractual relationships periodically, particularly if things change within
your market or industry. Along the way, you may find new distributors eager to carry
your clothing. If that happens, reviewing existing contracts protects you from getting
into a new deal that’s legally prohibited. Full disclosure, as it relates to the terms and
conditions stipulated when you struck deals with your distributors, always is the best
policy.

How to Get Clothing Distributed to Major

Department Stores
by Lisa McQuerrey

Related Articles
 1How Does a Clothing Distribution Deal Work?
 2Get Someone to Invest in Your Clothing Line
 3Approach a Store to Sell Your Product
 4Start a Clothing Business With Buying Wholesale
One of the best ways to promote your clothing line is to secure mainstream distribution
through major department stores. These stores typically have chains across the nation;
they employ sophisticated marketing techniques to sell their products, and those of the
clothing designers they carry. There is a variety of ways to get noticed by buying agents
in major department stores. For best results, design a complete clothing line, produce
samples, and identify a garment manufacturing company prior to attempting to get
your clothing line distributed to major department stores.

1.

Take your product online. Build a website and social media sites with full-color photos
and enticing descriptions of your clothing line. Include details about retail or wholesale
opportunities, and provide contact information. Department buyers regularly search the
Internet for chat related to new designers, and may contact you directly from a web
search.

2.

Create a catalog of your clothing line and include a removable, updatable one-page
sheet that details wholesale and retail pricing. Send the catalog to the purchasing or
buying department of major department stores.

3.

Make personal appointments with purchasing agents in major department stores and
provide them with samples of your clothing line.

4.

Retain a public relations or marketing company with experience in promoting products

to the retail industry. A good firm can make introductions to major department stores,
and can distribute press releases to department store and retail trade publications
detailing the launch of your clothing line.

5.

Host a fashion show to benefit a favorite charity, and invite representatives from major
department stores to attend. Hold a reception after the event and make time to meet
one-on-one with department store buyers.
 6.

Attend fashion industry trade shows, and consider purchasing a booth to display your
line. This is where many retail department store clothing buyers make their purchasing
decisions for the year.

Things Needed
 Product samples
 Sales and marketing materials
Tips

 To expand exposure for your clothing line and catch the eye of department store
buyers, submit your websites to all major search engines and exchange links with others in
the fashion industry whenever possible. Visit online chat rooms and discussion groups and
begin talking about your line.
 Employ a celebrity endorsement. If you have any connections to celebrities or well-
known personalities, connect with them or their representatives to discuss an endorsement
of your line. Having a household name representing your line will make you that much more
appealing to major department stores.