Starting up an online fashion retail business
Starting up an online fashion retail business
1. Demographics
Make sure you know the exact target market for your product. This is a priority because it will shape your branding and visual aesthetics. It will assist you in any marketing campaigns or promotions tactics you employ to boost sales. You should take legal advice for any promotion or marketing campaign. If it includes a digital aspect you should ensure that the lawyer you use has some specialisation in digital.
2. Geographical area
Think carefully about where your website will be targeting. If you are supplying the USA, China, Canada for example, are you complying with their local laws? Are your trademarks protected in those jurisdictions? The Internet has allowed retailers to access valuable markets in parts of the world where a small business could not dream of, but there are legal implications too.
You must take into account the law of the consumer markets in which you are offering your products. This is an issue that your website terms and conditions lawyer should address. Note that it is a complex matter and a solicitor qualified in England and Wales may not be able to advise you and might have to get advice from a lawyer local to the jurisdiction for definitive advice. Overseas lawyers’ fees usually start at a minimum of £1,000 (when converted) but that is only the firm’s experience, and is not meant to be a definitive guide.
3. Logo
The next thing in order of importance would be building your brand and visual aesthetics.
Your logo is very important as part of brand building. Go to a design agency for your logo. In an industry as saturated and competitive as fashion you really need to stand out. Your logo matters. Make it simple, recognisable unique, relevant and versatile.
All of the above should be done before starting up an online fashion retail business.
4. Starting up an online fashion retail business website/mobile App
The first thing to realise is that online fashion retail is very similar to bricks & mortar fashion retail in that branding and visual aesthetics matter. Infact visual aesthetics matter even more on a website or a mobile app because customers do not have the physical engagement with your product. So your website must have a strong visual impact to make customers feel like they are in a real shop. You will need a very good and ethical web/mobile app designer and developer. Note that a web designer does not necessarily have the same set of skills as a developer. As their title suggests a web designer’s strong suit are the visual aesthetics of your website, whilst a developer is more focused on coding. You will need someone or an agency that is good at both so you can combine analytical and creative media that can help present your products in the best way to customers. You need to employ merchandising techniques, and strong branding that incorporate clear identifiable attributes (for example “high end young urban” or “American preppy”). Create a well thought out visual experience online and your customers will keep coming back.
If you are a start-up on a very small budget (say up to a maximum of £1,000), build your website using open source online free platforms like WordPress. They are much cheaper than an original website design on a proprietary content management system. Unfortunately, professional legal advice is often beyond the reach of start-ups with small budgets of up to a £1,000 to spend on their website or mobile app. For this small size business, I recommend online legal services like legal zoom which are very cheap but they are not suitable for complex legal advice. If you are on shoe string budget of a few hundred pounds they are your best option.
If you are an SME with a budget of say £10,000.00 to £100,000.00 and above then you should build your website on a proprietary CMS. You should also outsource, get professional artists to create your logo, get a professional design agency to design and build your website, and instruct specialist lawyers and accountants. You will pay the market rate but it will be a high standard of advice from professionals that are regulated and insured.
Typically the difference between open source and proprietary CMS is tens of thousands of pounds. There are lots of disadvantages to an open source platform. The advantage is that customisation, design and hosting is very cheap these days. It’s all about how much you have to spend. Open source platforms are very effective at building your online presence quickly. You can also get effective social media plug ins that will help build your social media presence.
Social Media
Build your social media presence. Stay current. Update your articles, tweets and social media status regularly. Join and start groups to engage your customer base.
5. Website/ Mobile App Development Agreement, terms and conditions and privacy policy
You need to have an agreement with your Web/Mobile App developer/designer. It’s still incredulous to me the number of entrepreneurs who don’t bother with a Web/Mobile App design and development agreement. The firm has even had situations where entrepreneurs have paid more than £30,000.00 for a mobile app or a website without any kind of written agreement with the developers. Problems start when the developers can’t or take too long to build what they agree to build. Often the developers are not insured and it is difficult to hold them to account. A non-disclosure agreement is not good enough, neither is a “gentleman’s agreement”. As the well worn saying goes “a gentleman’s agreement’ isn’t worth the paper it’s written on.” Bear in mind that web developers are not regulated. There is no web developer ombudsman to complain to if their services are not satisfactory.
You will need to manage loss prevention, data protection, privacy and other law related website issues. You need to have a well thought through returns policy addressing fraud returns and other matters that will cut into your overall profit and drive your costs up in your terms and conditions.
6. Partners, employees, consultants and interns
Remember that if you suddenly start to do well a disgruntled employee or partner could see an opportunity to leave your business and set up a competitor business. This often happens . Another business with a similar name to yours, that has copied or adapted the visual aesthetics of your website and your products can kill your business especially if it is undercutting you in price.
If you can afford the fees, get a good commercial lawyer to draft your agreements to prevent this conduct which unfortunately is quite common. You should also get a commercial lawyer that specialises in intellectual property to advise you regarding your intellectual property rights before starting up an online fashion retail business.
7. Copyright
You will need to protect your website from copyright “theft”. There is copyright in certain original works in a website that qualifies into fixed legal categories like computer programmes, data bases, literary, artistic, dramatic. Note that suing for copyright infringement can cost tens of thousands of pounds and may be out of the reach of start-ups. It is not something to undertake lightly. One way of mitigating the cost is to make sure you have properly protected your copyright and that you own it. This will mean it will be more straightforward (and therefore cheaper) to assert your rights if you ever need to. The web development agreement, and any consultancy, partnership or employment agreement are extremely important to protect your intellectual property rights including your trade secrets. For more information on UK Copyright Law refer to the Copyright Designs and Patents Act 1988 – UK Copyright Law.
8. Trademarks
You should register your logo (figurative) and any text related to your logo (your logo could also be text) as a trademark before starting up an online fashion retail business. To be registered a trade mark must be distinctive, and not similar or identical to an existing trade mark. Also it must not be deceptive or contrary to law or morality. For more information on UK trademark law refer to the Trade Mark Act 1994 – UK Trade Mark Law.
9. Passing Off
If you have not registered your trade mark and you have reputation in your brand then you can rely on passing off, provided there is misrepresentation.
If you like this article on starting an on-line fashion retail business then you might like our articles on:
Fashion Shows
INTELLECTUAL PROPERTY LAWYER FOR SMALL BUSINESS
Trademark Legal Advice
To book a face to face consultation for advice on Starting up an online fashion retail business you should contact a specialist e-commerce solicitor (charge rates may apply and may vary).