Guest Blog – Lauren Spruel
Edited by Karen Burkey
So You Think You Can Retail Cloth Diapers?
You can imagine it already. You’ve been using cloth diapers for almost a year; your collection is growing more and more every payday. Even so, there’s prints stuck in your head you can’t seem to find. BAM! You have the best idea ever:
Open your own cloth diaper company!
You mull it over. The more you think about it, the more you love the idea. You start with your good ol’ friend Google. What comes up? Random cloth diaper manufacturer sites. Next, you go to social media. You delve into the various cloth communities and ask others what they think of your idea, what they’d like to see and if they would be willing to participate in a preorder. The reaction from the community is overwhelming with support. You finally settle on a manufacturer that replied to your email and you get your order started. What’s the worst that could happen?
Well, since you asked…
- Your turn around time (TAT) could be extended. Shipping could be delayed.
- The first preorder doesn’t get enough to cover the deposit, so you leave it open and use your own funds to pay the deposit. ‘It will definitely be filled by the time the diapers are done,’ you tell yourself.
- One customer goes on Facebook and asks if anyone else has ever ordered from you and the backlash begins.
- You start getting disputes, which charge you a $15-30 fee on top of the disputed charge and take up to 75 days to be resolved.
- You have to tell a customer they cannot receive their refund for a product they preordered, so they complain all over social media about your customer service.
- Your order is ready, but you don’t have the funds to pay the remaining balance.
- You’re mentally, emotionally and physically drained before your first order even arrives.
How do I know this? I’ve lived this. I’ve seen this. I’ve watched companies fall before they even get the chance to rise,
So before you go to Google and Facebook and use them as your advisory committee, please read this. I’m no business expert, but I do feel these tips can be tools for your success if used correctly.
Here’s the nine steps outlining what you need to (hopefully) NOT fail as a cloth diaper retailer:
Step 1: Have enough capital
Step 2: Get samples
Step 3: Place your order
Step 4: Take a deep breath
Step 5: Make your mark
Step 6: Be aggressive
Step 7: Get honest reviews
Step 8: Get ready to do it all again
How to (hopefully) NOT fail as a cloth diaper retailer
Step 1: Starting Capital? $5,000
My first question will always be ‘do you have any capital?’ You should have a MINIMUM of $5,000 you can use as capital. Relying on preorders alone is not the best way to get your business started. It’s risky. You need to establish yourself as a reliable brand. Your first order should always be paid in full, received and sold as stock. If you then decide to start preorders, you already have your foot in the door. Don’t submit a preorder until you have all the funds available. Make sure you are prepared so it does not hinder your business or personal life.
Step 2: Get Samples, about $600
GET SAMPLES. Do it. Get samples. Get a minimum of three samples from three different companies. That’s nine samples total. Get a variety of diapers and accessories: cover, pocket, wet bag, pod, all-in-one, pail liner…get them all or just three. But always get samples! Once you receive your samples, submit your edits and get new samples made. Keep doing this until your product looks and functions exactly how you’d like it. Additionally, get fabric samples of any prints you want to offer (if choosing your own). Once you think you have a product you like, privately ask close friends (if they cloth diaper) or someone in the community to test all your samples. Get their honest feedback.
Step 3: Place your order, space it out
I HIGHLY recommend using fabric from the manufacturer or at least a majority of its fabrics. There are usually three types of Minimum Order Quantities (MOQ’s): minimum quantity per fabric print, minimum quantity of product style and minimum product per print per style. Confused? It gets easier, I promise!
Here is an example order form. We’ll say all the fabric is custom. There is a minimum of 150 per print, 300 per product and 50 per print per product.