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Written by: Carolyn Young
Carolyn Young is a business writer who focuses on entrepreneurial concepts and the business formation. She has over 25 years of experience in business roles, and has authored several entrepreneurship textbooks.
Edited by: David Lepeska
David has been writing and learning about business, finance and globalization for a quarter-century, starting with a small New York consulting firm in the 1990s.
Published on February 1, 2022
Investment range
$3,050 - $7,100
Revenue potential
$52,000 - $104,000 p.a.
Time to build
0 – 3 months
Profit potential
$40,000 - $52,000 p.a.
Industry trend
Declining
Commitment
Flexible
Important elements to think about when starting your sewing business:
Starting a sewing business has pros and cons to consider before you decide if it’s the right path for you.
Trends in the sewing industry include:
Challenges in the sewing industry include:
Among the workers in the sewing industry are sewing machine operators.
Startup costs for a sewing business range from around $3,000 to $7,000. Expenses include a website and sewing equipment and supplies.
If you do not know how to sew, you can take unlimited sewing classes for a year through a site like Tailor Academy for about $700. Courses are offered every two weeks.
You’ll need a handful of items to successfully launch your sewing business, including:
| Start-up Costs | Ballpark Range | Average |
|---|---|---|
| Setting up a business name and corporation | $150 - $200 | $175 |
| Business licenses and permits | $100 - $300 | $200 |
| Insurance | $100 - $300 | $200 |
| Business cards and brochures | $200 - $300 | $250 |
| Website setup | $1,000 - $3,000 | $2,000 |
| Sewing machines, equipment, and supplies | $1,500 - $3,000 | $2,250 |
| Total | $3,050 - $7,100 | $5,075 |
Prices for sewing services vary greatly based on the work being done. Simple projects like hemming can range from $20 to $50, while larger custom jobs can be $100 to $250 or more. The below calculations assume an average price per job of $50. After the cost of supplies, your profit margin should be about 80%.
In your first year or two, you could work from home and do 20 jobs per week, bringing in $52,000 in annual revenue. This would mean more than $40,000 in profit, assuming that 80% margin. As you start to get referrals and your business grows, sales could double to 40 jobs per week. At this stage, you’d have to hire staff and acquire additional machines, reducing your profit margin to 50%. With annual revenue of $104,000, you’d still make a cool $52,000.
There are a few barriers to entry for a sewing business. Your biggest challenges will be:
Now that you know what’s involved in starting a sewing business, it’s a good idea to hone your concept in preparation to enter a competitive market.
Market research will give you the upper hand, even if you’re already positive that you have a perfect product or service. Conducting market research is important, because it can help you understand your customers better, who your competitors are, and your business landscape.
Research sewing businesses in your area to examine their products and services, price points, and customer reviews. You’re looking for a market gap to fill. For instance, maybe the local market is missing a sewing business that offers custom embroidery.
You might consider targeting a niche market by specializing in a certain aspect of your industry, such as curtain making.
This could jumpstart your word-of-mouth marketing and attract clients right away.
Your services will depend on your sewing skills. You could just offer basic alterations, or you could offer custom embroidery, custom clothing, or curtain and pillow making. Here are different sewing business ideas for your inspiration.
Prices will vary based on the services you are doing and could be anywhere from $20 for simple hemming up to $250 or more for custom clothing. After the cost of your supplies, you should aim for a profit margin of about 80%.
Once you know your costs, you can use this Step By Step profit margin calculator to determine your mark-up and final price point. Remember, the prices you use at launch should be subject to change if warranted by the market.
Your target market will depend on the services you offer, but will be broad. If you offer curtain and pillow making, your target market will probably be homeowners. If you tailor suits, your market will be professionals. The alterations and custom clothing market could be any group. You should keep your marketing efforts broad, and target sites including Instagram, Facebook, and LinkedIn.
In the early stages, you may want to run your business from home to keep costs low, and it may stay that way. However, if you want your business to grow into a larger company that manufactures custom clothing or home décor products, you’ll need to rent out a production facility. Find commercial space to rent in your area on sites such as Craigslist, Crexi, and Instant Offices.
When choosing a commercial space, you may want to follow these rules of thumb:
Here are some ideas for brainstorming your business name:
Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these.
Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that set your business apart. Once you pick your company name, and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.
Here are the key components of a business plan:
If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.
Registering your business is an absolutely crucial step — it’s the prerequisite to paying taxes, raising capital, opening a bank account, and other guideposts on the road to getting a business up and running.
Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business!
Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you are planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to sewing businesses.
If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state.
Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your sewing business will shape your taxes, personal liability, and business registration requirements, so choose wisely.
Here are the main options:
We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization, and answer any questions you might have.
Choose Your State
The final step before you’re able to pay taxes is getting an Employer Identification Number, or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN.
Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.
The IRS website also offers a tax-payers checklist, and taxes can be filed online.
It is important to consult an accountant or other professional to help you with your taxes to ensure you are completing them correctly.
Securing financing is your next step and there are plenty of ways to raise capital:
Bank and SBA loans are probably the best options, other than friends and family, for funding a sewing business. You might also try crowdfunding if you plan to grow your business into a bigger company.
Starting a sewing business requires obtaining a number of licenses and permits from local, state, and federal governments.
Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits.
You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more.
You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.
This is not a step to be taken lightly, as failing to comply with legal requirements can result in hefty penalties.
If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.
Before you start making money, you’ll need a place to keep it, and that requires opening a bank account.
Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your sewing business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.
Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account.
Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.
Here are some types of insurance to consider:
As opening day nears, prepare for launch by reviewing and improving some key elements of your business.
Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks.
You may want to use industry-specific software, such as Wild Ginger, Geelus, or Sewing ERP, to manage your orders, workflow, invoicing, and supply inventory.
Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism.
You can create your own website using services like WordPress, Wix, or Squarespace. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.
They are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. These are steps that help pages rank higher in the results of top search engines like Google.
Here are some powerful marketing strategies for your future business:
Unique selling propositions, or USPs, are the characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your sewing business meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire.
Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your sewing business could be:
You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a sewing business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in sewing for years and can offer invaluable insight and industry connections.
The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in sewing. You’ll probably generate new customers or find companies with which you could establish a partnership. Online businesses might also consider affiliate marketing as a way to build relationships with potential partners and boost business.
If you’re starting out small from home, you may not need any employees. But as your business grows, you might want to start a production facility for your services and custom products. Potential positions for a sewing business would include:
At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need.
Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent.
Sewing is a hobby that’s easy to turn into a money-making business. It just takes skills and a small investment, and you can run the business from home. You can offer far more than alterations to increase your revenue, from custom embroidery to custom clothing and home décor. You’ll need to get the word out with some marketing, but once you have a client base the business should start rolling in.
Now that you’ve stitched up some knowledge, it’s time to get that thread and needle going to sew your new entrepreneurial success!
Absolutely! Your ongoing expenses will be very low, so most of the money you make will stay in your pocket. Jobs can range in price from $20 to upwards of $250, and you should be able to do multiple jobs a day once you get established, so you can make a nice profit.
You can do simple things like hemming and alterations, but you could also offer custom embroidery, custom-made clothing or even home décor items. Get creative and consider all your option.
Sewing can be a profitable business depending on various factors such as market demand, competition, pricing, and the quality of your work. The profitability of a sewing business also depends on factors like your target market, the types of products or services you offer, and your ability to effectively market and manage your business.
Utilize online platforms and social media to showcase your work and attract potential customers. Create a professional website or online portfolio that highlights your skills, services, and contact information. Utilize targeted online advertising or local directories to reach individuals interested in sewing or custom-made products. Attend local craft fairs, community events, or markets to showcase and sell your products.
Some common sewing projects include clothing alterations, home decor items like curtains or pillows, accessories like bags or wallets, and custom-made clothing or costumes.
The easiest thing to sew depends on your level of experience and skill. However, simple projects that are often considered easier for beginners include sewing straight seams on items like pillowcases, tote bags, or simple skirts.
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