It’s not easy to get the proper funding for your fashion business. As the founder of FWRD Funding and Marketing, my team and I receive a lot of inquiries from potential business founders and see the same mistakes happen time and again.
Mistake #1: Not Having A Fashion Business Emergency Fund
When it comes to an emergency fund, a fashion business works the same way as your personal finances do. When an emergency happens, you will need to have the funds available to cover it as well as any ancillary needs stemming from the issue.
The prevailing thought is that a business should have anywhere from three to six months of operating capital that can cover all of the expenses for that time. The emergency fund should be able to handle this without the need for additional debt or loans.
Some experts suggest that having access to a loan will suffice as an emergency fund. Others tend to agree that the best protection in an emergency is to have the funds liquid and readily available as needed. After all, you have no idea what kind of emergency could happen, and it could impact your ability to get the loan.