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Launching an online apparel store? Begin with a business plan

Also: How to calculate pricing for service work, and small-business kitchen incubators for new food products.

September 15, 2009|Karen E. Klein

Dear Karen: Last year I started an online business for ladies' apparel, but I have yet to sell an item. Where can I buy products?

Answer: If you're having trouble sourcing product, you haven't done enough research into the apparel industry, said Ilse Metchek, president of the California Fashion Assn.

"Locating manufacturers is not a problem in Los Angeles. There are thousands of them in the Fashion District" downtown, Metchek said. "I suggest that writing a business plan is in order."

Back up that business plan with consumer research on your targeted customer demographic. Ladies' apparel is a huge category, so narrow down exactly what you're selling: Sportswear? Business attire? Petites? To what age group and price point will your product line appeal?

Make sure that your website is inviting and well-marketed, then purchase some inventory to sell on your site. "Minimums are small, but cash is king" for local apparel manufacturers, Metchek said.

Figure out how much to charge

Dear Karen: Do you have any pricing advice for my new service business?

Answer: Service providers must balance the priority of being affordable and the necessity of earning what they are worth. You can price jobs on an hourly or a fixed-bid basis.

Start out pricing fixed-bid, said Michael Weiss of Imagistic, an Internet marketing company based in Westlake Village. "This means you look at the project as a whole and give a single price for all the work," he said.

You arrive at the figure by breaking the project down into tasks and assigning each task a time estimate. Once you decide how much time the job will take, apply an hourly rate that is fair to you and your client.

"If a job will take you 100 hours and you want to make $50 an hour, charge $5,000," Weiss said. "It will then be your goal to do it in under 100 hours and make a bigger profit. If you go over in hours, it will be your loss."

To launch a food product, get help

Dear Karen: How do I start selling my barbecue sauce?

Answer: Developing, packaging and marketing a new food product is difficult and costly. You might get help, however, at a new small-business kitchen incubator in Pasadena.

Mama's Small Business Kitchen Incubator is sponsored by the economic development arm of the Episcopal Diocese of Los Angeles. Housed in a former restaurant, the incubator aims to help low- and middle-income entrepreneurs with business plans. Find it at www.mamashottamales.com (click on "kitchen incubator").

The Los Angeles County Community Development Commission operates four business incubators that provide advice, resources and low-cost work space for qualified entrepreneurs.

The CHARO incubator near Cal State Los Angeles is designed for small businesses transitioning out of home-office space. It's at www.charo corp.com (click on "business incubator").

Additional incubators are located in Altadena, Pomona and Lancaster. Check www .lacdc.org (choose "business incubators" from the programs tab and then "Los Angeles County Incubator Network").

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Got a question about running or starting a small enterprise? E-mail it to inbox.business @latimes.com or mail it to In Box, Los Angeles Times, 202 W. 1st St., Los Angeles, CA 90012.

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