How to Start an Embroidery Business in 2021

How to Start an Embroidery Business in 2021

 

Designs! Patterns! If you think this are buzz words, no you have to think again. They may seem, but they are not.  Designs and patterns are what makes clothes and other forms of materials stand out, and the process of creating such beautiful designs and patterns is called embroidery.

Embroidery started many years ago as a hobby, but now it has become a full-fledged business, which has birthed many millionaires all over the world. In this practical guide, we will not be talking about the history of embroidery, but rather we will be looking at the step by step process, you can take to start your own embroidery business in 2021 and beyond.

There is no better time than now to start your own embroidery business, not minding if you want to start it in your spare room or garage, or if you want to do it in a commercial scale. We will be providing you with all the information you will need to set up and running, and we will also hold your hand, guiding you in the entire process, as our responsibility to you is to see your embroidery business up and running in no time.

Your interest might not have been to start an embroidery business, maybe based on the fact that you do not have the skill or possibly the resources, or don’t know how to go about it, you don’t have to worry, we have you covered in this post, if only you have the will-power and mental resources, you can easily assemble a team with the right skills, and with you information we will provide here, you will have your business up and running.

Now that we have cleared your doubts, and you are all geared up to get starting, let us look then at the following steps that will get you started the right way, scale up and become profitable in your new found embroidery business.

So ready? Steady! Go!

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  1. CHOOSE A NICHE

Choosing a niche may sound like a clique, but when it comes to business, it should not be seen as such. It is very important that you choose a niche for your embroidery business from the beginning, as you would not want to start off as a jack of all trades.

The reason why it is good to choose a niche, is that it will enable you learn the ropes of the business, know what works and what does not work, and then help you re-twerk your business and put you in a better position to expand into other niches.

Listed below are the available niches you can start with and expand into others as you progress with your business, as focusing on a particular niche will help you provide the specific services your target audience needs.

  • Athletic teams/Schools
  • Weddings and bridal parties
  • Moms/Moms-to-be/Grandparents
  • Logos for corporate bodies/clubs

Deciding on a niche however from the beginning, may somehow be a tough decision, as the niches are more likely to be inter-related, but it is good to focus on a target audience and grow it, before expanding into more areas. This will however depend on your skills, resources and your business acumen.

The followings are the most popular items where embroidery services are most needed.

  • Caps
  • T-Shirts
  • Polo Shirts
  • Shirts
  • Jackets
  • Sweatshirts
  • Shoes
  • Hat brims
  • Napkin corners
  • Kitchen towels
  • Hoodies
  • Beach towels
  • Bags, tablecloths
  • Gloves
  • Pants, jackets
  • Quilts and bed sheets
  • Pillows
  • Toys
  • Baby clothes
  • Bibs
  • Nightgowns
  • Blankets

CLIENTS FOR YOUR EMBROIDERY BUSINESS

  • Uniform companies.
  • Schools
  • Sports goods shops
  • Retail shops
  • Clubs
  • Big brands
  • Summer camps
  • Hospitals
  • Music bands
  • Resorts and hotels and restaurants
  • Construction companies
  • Local businesses

You should then look at the sectors, where this items are used more and those who need embroidery services on those item, and if the customer base is big enough to run a sustainable business, then you should start with them and scale up.

  1. REGISTER YOUR BUSINESS

It is always advised that you choose a name for your business and get it registered immediately. It may be that you want to start your embroidery business inside your room and do it on a small scale, but it is always very good to have your business registered, as you never can tell, if what you are thinking of as a hobby turns out to become a major income earner for you.

Processes and guidelines for company registration differs from state to state or country to country, you should however reach out to the company of your country or state of operation and get your business registered, either as a sole proprietor, limited liability partnership or a limited liability company.

We will however advice that you register a limited liability company, but it all depends on the scale of embroidery business you want to do. Alternatively, you should seek the advice of a lawyer to recommend the best form of legal structure that will be suitable for your business.

Once you have your business registered, you should also register with the customs and revenue board for tax purposes, as you would not want to go on a collision course with the authorities in the future, simply because your business failed to remit taxes. You should also apply and obtain Employer Identification Number (EIN), as you will ultimately employ staff for your business in the future.

  1. WRITE A BUSINESS PLAN

It does not matter if your interest was to just simply get your hands on a new type of business, but the fact that you have followed this guide to this point, implies that you want to run your embroidery business professionally.

It is therefore very important to write a business plan as this will serve as the guiding light for your business, as your move through the maze and the dark corners of the business world.

The business plan should be able to detail and explain what your business is all about, what the structure of the business is, how you intend to raise funds for the business and the financial projection for the business?

Having a detailed and in-depth business plan will make your pitch to bankers, investors and partners easier, when you are ready to source for funds, when the need arises.

There are many free business plan samples you can access online for free and tailor them to suit the needs of your business or you can hire a professional to write your business plan for you if you have the resources.

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  1. SOURCE FOR FUNDS

Your embroidery business will have little or no chance of surviving if you don’t have the required funds to start and sustain the business. Sourcing for funds is the most enjoyable and annoying part of the business set up, as both small businesses and large corporations are all always looking for avenues to raise more funds.

We will therefore look at the available options on how you can source for funding for your new business.

  • Savings: There are all indication that the initial investments you will make on your embroidery business will be from personal savings, but if you don’t have a pile of cash saved in the bank or you have not recently inherited millions of dollars, it then means you will have to look for alternative means of raising the funds.
  • Friends and family: You can be guaranteed to have friends and family invest in your business if they have the resources. But it is always advised that you ask for an amount they should be willing to lose, as businesses don’t always go as plan. Always ensure that all agreements with regards to the loan from them are well documented, so you don’t lose trust in the future, when the business fails or succeeds.
  • Bank loans/business credit card: Depending on the state or country you will be operating from, you may be able to secure bank loans by applying for it. The approval for such loans will however be subject to your credit history and other parameters set up by the bank. Before applying for any bank loan, do a proper research on the terms and conditions of the loan, covering items like interest rate, tenure of the loan, etc., before making your final application decision. You can also apply for business credit card and use it to set up your business, but it still depends on the terms set up by the credit card company. You should however choose a credit card with introductory 0% APR.
  • Equipment Loan: Getting an equipment loan has an advantage, as the equipment can be used as collateral for the loan. So you should shop around and see the equipment loans your embroidery business will qualify for.
  • Investors/partners: There are many investors out there looking for new opportunities to invest in. You never can tell if you will be able to arouse the interest of any of them and get them to invest in your business. You should however know, that an investor will end up having a percentage share of your company, but if you are comfortable with that, why not go ahead then and pitch your business to as many of them as possible.

BUY YOUR MACHINES/EQUIPMENT

Embroidery business need machines and equipment to produce quality and consistent results. You are therefore expected to get the right machines and equipment for your business. Machines and equipment are one of the most critical aspects of your business. And when you have the right machines and equipment, the more time they are up and running, the more value you will offer to your customers, which will enable you to earn more money for your business.

There are low range to high range machines available in the market that you can buy, but if you are starting your business on a large scale, it is good to buy a multi-needle embroidery machine, as this machine will help you increase work flow.

Start-up costs for your machines and equipment will differ, depending on the size of your business and how many customers you are expecting to serve. Smaller businesses for instance, will only require a single-head embroidery machine, while a larger company will need a multi-head machine to cope with more pressing customer demands.

  • An average single-head embroidery machine costs – $4000.
  • An average multi-head embroidery machine costs – $8000.

Your embroidery business will therefore need any of the machines to operate successfully. There are many vendors and ranges of machines in the market, and since your machines will be your most valuable assets, you must be detailed in your research about the machines before making a choice.

As choosing the wrong embroidery machine, will not only be a financial mistake, it will also become an operational one, thereby negatively impacting on your business.

Aside you buying the machines, you will also need the materials that you are going to be embroidering. This depends upon the range of service that you are looking to provide to your customers.

If you have the budget, your business will operate more efficiently if you can purchase a full stock of materials. When thinking of popular items to stock up on, think of the types of customers that are always looking for embroidered goods. For example, sports teams, fast food restaurants and charities constantly require embroidered clothing, so stock up materials that will enable you meet their needs.

As part of your equipment, you will need access to a computer and a printer for your designs. You will also need design software for more complicated designs, so that all your jobs can come out professionally.

We have no affiliation with ZSK, but you can check out the ZSK sprint series embroidery machines for a start, as the machines are sure to deliver quality and precision. You can also search for other types of embroidery machines, do your analysis on each of them before making your final purchase decision.

No matter the type of machine or equipment you decide to buy, always have at the back of your mind that an embroidery business makes you a sort of an artist, so you should always endeavour to translate the vision of the customers into a fabric.

  1. INVEST IN EMBROIDERY SOFTWARE

We are in living in the days of processes and automation’s. There are therefore software’s like fabric assist tool or hatch embroidery that are out there, that will help you create and deliver quality work, while at the same time giving you more free time to focus on some other aspect of the business.

For instance, the fabric assist tool inside of Hatch embroidery software helps to alter the design settings (such as density, underlay, pull compensation which often leads to a change in stitch count) for a different fabric in one click of a button, without the software this action will take you a lot of time and process to achieve.

Embroidering a design on one type of fabric don’t always work same way when the design is embroider on a different kind of material, so having the right kind of software will save you a lot of work and issues, when switching between a Pique knit and a Thai silk for instance

  1. MACHINERY COMPONENTS

Getting your machine and equipment will not necessarily run their selves, so there are other items you will need to get your machine up and running.

  • Thread. There are two types of thread commonly used in embroidery business. They are rayon and polyester. Rayon is the easiest to use, but polyester is gradually becoming a better alternative, as rayon have a shelf life of 5 years and is also more prone to thread break.
  • Needles: There are different sizes of needles, each suited for different fabrics. The most commonly used are the round sharp (R) and the fine ball point (SES). Sharps are used mainly for woven materials, and ball points for knitted materials. A medium ball point (SUK) works better for some knitted materials, and a thin ball point (SES) is sometimes suitable for both knitted and woven fabrics. You should avoid using sharps on knitted fabric, as they have a tendency to rip holes in the material. Fabrics such as leather need an extra sharp needle, such as an acute point (SPI).

Hoops: They come in variety of sizes, and the size used is dependent on the type of garment. Hoops are used to achieve a neat and accurate stitch.

  1. MARKETING YOUR BUSINESS

Marketing is the heart and soul of any business, your embroidery business included. No matter how beautifully set up your business is, you will not attract any customers if you don’t market it.

So you should be very intentional in your marketing approach, by developing a marketing strategy what will help you answer the following questions

  • What is the objectives the business?
  • What do you want to achieve?
  • Is it a revenue goal or a profit goal?
  • How many leads per month will you need to generate that revenue?

With the right objective and budget, it is now time to start getting the word out about your business.

You can use any of the following channels and mediums to market your business and generate the customers you need, that will help make your business profitable and sustainable

  • Website:
  • Flyers
  • Social media
  • Targeted adverts on Google, Facebook, etc.
  • Word of mouth
  • Blog posts
  • SEO
  • Paid adverts on newspapers/radio
  • Listing in directories and classifieds
  • Signage
  • Networking
  • Referrals
  • Local shops

No matter the medium or channel you decide to use, the key should be to study the mediums and channels, find out the one your target audience spend more time, and then tailor your message in a tone and with the right visuals that will resonate with them.

Bonus resources

Machine manufacturers/suppliers

Supplies

Final Thoughts

Starting and running a successful business is not a casual work in the park, as there are many uncertainties along the way. So it is common with every business, including your new Embroidery business, you should have it at the back of your mind that your embroidery business will not produce an instant return, but with a bit of patience, hard work and willingness to learn, and by building a reputation for quality and reliability, you will in no time begin to beat the drum of celebration, as you will be forever grateful for the day you took the decision to start your embroidery business.

We promised at the beginning that we are going to provide you with massive value and hold your hand all through, till you become bold and confident enough to step out and start your business, this we can say we have achieved without an iota of a doubt. But the question is, are you willing to take the bold step? Are you ready to put what you have learn here into practice? Are you willing to be called a business owner? Why not prove it and get started today.

What are your thoughts with regards to this practical guide and do you have any business idea you want us to write about? Let us know in the comment section.

 

 

 

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