A Friend Followed His Dream To Start A Clothing Business – He Lost $50k & Is Shutting Down.

The fear of most business risk takers.

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So here’s what happens. They always tell you to follow your dreams and start your own business because it is exciting. It is risky, but it is exciting, isn’t it? Having a risk compared to not having a risk is by itself kind of fun.

Every single person that I know who lives in a very organized country has the time of their lifetime when they go to countries that are totally chaotic in terms of traffic and so on. This is the root of it. You want to have risk in your life. It gives you energy, it gives you motivation.

A friend of mine wanted to start a clothing brand, which is very common for a lot of startups out there. He followed the rules of business that are written in business books being taught in top universities these days. He started a company that had a good brand and very good product quality - it was top notch. Then he hired an expert advertising agency to start selling the product online. The results were very simple: He spent over $50,000, and the revenue (not profit) was approximately zero dollars.

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Following the "Expert" Path

He decided to go all in, putting in around 50k of his own funds into a startup company. He imported high-quality products from the Middle East. Each piece cost him around four dollars at his factory, and he bought around 10,000+ pieces of stock. He went to an incubator to learn more about the entrepreneurial world. The incubator supported him strongly and even gave him a prize for having what they believed was a good product.

What happened next was kind of the biggest problem. If you’re following the rules of the business books and you’re starting a clothing business, what’s next is quite simple. You need to either sell offline or online.

• If you’re going to sell online, then start some campaigns on Google or Instagram.

• If you’re selling offline, then do some outreach. He did the outreach himself, and this did not really work out. Out of almost 100 places, not a single one accepted taking his products.

Next came the marketing phase. He spent around $10,000 to create a simple online shop with his brand and some pictures.

Finally, he turned to digital marketing agencies, spending another $30,000 on website enhancements and advertising campaigns. The result? Zero sales.

What’s the root of the problem? You might think that he has an inferior product or a bad website. But the truth is, marketing agencies with an inferior product, should not have $0 revenue.

Those SEO, Google ads agency swarming the Internet. The majority are simply trying to rip some cents off of you. They might not even know it. They might think that they did their best. That the problem lies in you not putting enough money in advertising.

The reality is online advertising requires experience. You really ought to vet those agencies before hiring one. Preferably one with a track record or a case study of a business similar to yours.

It is seldom about the website or the product. Getting the ads live is not really the problem, Getting sales is and always will be.