Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Building a Fashion Company on the Internet? Stop. Just stop.

melanie.io

Post reply on HN
Print view View original

41–50 of 95 posts

Re: Building a Fashion Company on the Internet? Stop. Just stop.

#41

Post by andreasklinger »

epicviking wrote: post #34
andreasklinger wrote: post #29

I run a fashion startup involving sampling, serial production and fulfillment. I couldn't agree more with Melanie. The risk aspect sizing and inventory management is a bit downplayed imho. Stocking breaks necks. Good merchandising is more important than breathing oxygen. Btw i would also appreciate HNs feedback on my company: http://www.lookk.com - if there is interest i could do a "show hn" post.

You really would benefit from sorting the items you have for sale. At the least Man and Woman.

Thanks for the feedback. The shop is yet very MVP-like. We are currently working on it.

Re: Building a Fashion Company on the Internet? Stop. Just stop.

#42

Post by switch »

sliverstorm wrote: post #4
switch wrote: post #3

Not really a well thought out article. Here's why - 1) Why should anyone care about solving the problems that the writer of this article wants to see solved? 2) She fixates on the 3-8% that affiliate sites make without considering a few things: a) Sites make that regardless of where the user actually buys. So if someone comes to your site and decides to buy a jacket you make money whether they buy it from Retailer A…

For criticizing her article for not being "well thought-out", you sure didn't write a well thought-out reply. I don't see how your reply actually disproves anything she said; you've basically just said, "no, she's wrong... because she is wrong."

No she is wrong because of this:

c) If you become the decision engine (something Google and Bing are trying to do with their Flight Search and other initiatives in various verticals), then you can easily take over the entire business.

If people are coming to you and you help them decide what to buy - then you can start selling them that stuff. *

If you become the decision engine for Fashion you can decide everything else.

I think perhaps it's not very clear until you consider what WalMart has done and what Amazon is doing.

And what Google is trying to do.

You start off as the starting point and then you start taking over more and more until you start producing the products you were originally only linking to.

Re: Building a Fashion Company on the Internet? Stop. Just stop.

#43

Post by switch »

rokhayakebe wrote: post #14
switch wrote: post #3

Not really a well thought out article. Here's why - 1) Why should anyone care about solving the problems that the writer of this article wants to see solved? 2) She fixates on the 3-8% that affiliate sites make without considering a few things: a) Sites make that regardless of where the user actually buys. So if someone comes to your site and decides to buy a jacket you make money whether they buy it from Retailer A…

You may want to give her more credit. She did a fashion startup for a few years. About the 3-8% affiliate fees, that's not a viable business model. You would have to deliver north of 15M dollars to get 1M dollars. Assuming the average ticket is $150, you need 100,000 conversion. The average internet conversion rate is 3%. So you need 3M uniques. That is not very easy to get. Even if you are buying it.

Give her more credit for what?

She did a fashion startup for a few years and she never figured out that nearly every luxury company gives 10% to 15% commissions?

If she really thinks it's 3 to 8% then she's blissfuly ignorant.

She doesn't get the fundamental concept of capturing the starting point. If a site becomes the destination for fashion i.e. where people go to search for the next thing they buy.

Then that site can very easily expand into selling that very thing.

At some point we say - Instead of getting 15% from this luxury watch maker, we ask for 25%. Then we say - Let's make stuff ourselves and see if we can get more than 25%.

What Google is doing and what Facebook is trying to do is very similar. Expand and take over all the profits. But first you need to be the starting point or decision point for something (search, social interactions, dating, buying clothes).

Re: Building a Fashion Company on the Internet? Stop. Just stop.

#44

Post by astrofinch »

jfarmer wrote: post #30
astrofinch wrote: post #12

Wouldn't you want to solve the customer acquisition process 1st and then re-factor your supply chain once your customer base is large enough to warrant the effort?

Now you have to build two successful products: one to acquire customers, and one to sell to them.

You mean one to acquire customers and one to do customer fulfillment. And customer fulfillment is useless if you don't have any customers. This seems obvious.

Re: Building a Fashion Company on the Internet? Stop. Just stop.

#45

Post by astrofinch »

chime wrote: post #2

> My guess is that the “back-end” supply chain / software / inventory management problems are just not as sexy as the “front-end” consumer-facing problems, or maybe the consumer-facing problems are just more intuitive. Absolutely! I wrote MRP systems for a pharma manufacturing in Florida and the kind of stuff I had to do on a daily basis far surpassed the complexity of your breathtakingly-beautiful but typical projec…

Working on a project like that sounds like a lot of fun. I guess there must not be very much money in it though because every company requires custom software, eh?

Re: Building a Fashion Company on the Internet? Stop. Just stop.

#46

Post by ig1 »

This article misses a huge point, it assumes It sounds to me that these startups are thinking "lets not waste a lot of money investing in a supply chain (ala webvan)". The quality of your supply chain might help you drive down costs, but it's going to do little to increase your market share.

The marketing and shop-front are the biggest factors that are going to impact market share, so it makes much more sense to focus the investment in those areas and outsource everything else until you're ready to expand. VC's aren't stupid, they're looking at the bigger picture.

Re: Building a Fashion Company on the Internet? Stop. Just stop.

#47

Post by 0x12 »

chime wrote: post #2

> My guess is that the “back-end” supply chain / software / inventory management problems are just not as sexy as the “front-end” consumer-facing problems, or maybe the consumer-facing problems are just more intuitive. Absolutely! I wrote MRP systems for a pharma manufacturing in Florida and the kind of stuff I had to do on a daily basis far surpassed the complexity of your breathtakingly-beautiful but typical projec…

Every time you see someone announcing a CRUD app written over the weekend you pretty much know that there is hardly any business logic involved.

The example you give is a great one, it only gets more interesting when it is not just money on the line but lives. Think avionics software and the like.

That stuff ranks amongst the most expensive software produced per line of code because of all the audits and certifications that try to ensure that there won't be hidden bugs that somehow make it into production.

Re: Building a Fashion Company on the Internet? Stop. Just stop.

#48

Post by justincormack »

jfarmer wrote: post #33
grimen wrote: post #16

Earlier quoted context omitted.

We got 30-40% on each sale. Not sure it's a US issue - in Europe it's 30%+.

What kind of products were you linking to that could afford a hit of 30-40% against their gross margins?

One of the reasons why stuff is so much more expensive in Europe than US. The prices are higher, so cash margins per sale still high even if percentage margins might be lower.

Now Europe is obviously a place where there is a lot of scope for these businesses.

Re: Building a Fashion Company on the Internet? Stop. Just stop.

#49

Post by reinhardt »

OWaz wrote: post #25
reinhardt wrote: post #13

The start-up I am contracting for is in a similar business (homeware and interior design) and has recently made the same decision to shift focus from a low margin, high volume affiliate model to a low volume, high margin "boutique" model. Curious to see how it pans out.

The low volume & high margin fashion site probably has a good chance of being successful as long as it carries recognizable and fashionable brands. The reason I say that is that sites like Net-a-Porter and MrPorter (which probably are mid volume) seem to be doing quite well based on the few articles I've read. Below is just one in case anyone is curious. http://www.nypost.com/alexa/p/the_top_shop_2HqqVcU4pRZJisg0N...

Recognizable fashionable brands such as John Lewis do fine on their own and are not going to give up a large chunk of their margin to a middleman. The biggest challenge for the new business model is try to discover and push less known brands or brands with little/no online presence with high quality products.

Re: Building a Fashion Company on the Internet? Stop. Just stop.

#50

Post by amac »

andreasklinger wrote: post #41
epicviking wrote: post #34

Earlier quoted context omitted.

You really would benefit from sorting the items you have for sale. At the least Man and Woman.

Thanks for the feedback. The shop is yet very MVP-like. We are currently working on it.

Interesting. Why did you decide to re-brand as Lookk from Garmz may I ask? (I took about 12 months to find the Lifemall name for my site)
Post reply on HN