How to start a successful clothing company in 2026

Considering starting a clothing company? You’re stepping into an industry with huge opportunities.

The UK fashion and apparel market is set to be worth a huge $98.5 billion by 2033 (roughly £78 billion). This growth is driven largely by the shift to online shopping and consumer demand for ethical and authentic brands. 

While the UK fashion world is competitive, it also has a relatively low barrier to entry — you don’t need a massive team or a physical shop to launch a successful clothing company. With a strong vision and the right strategy, you can absolutely stand out and thrive. 

If you’re dreaming about starting your own clothing company, this guide is for you. 

In this article:

• What do you need to start a clothing company?
• How much does it cost to start a clothing company?
• How do I start a clothing company? Step by step
• What insurance and licences do I need to start a clothing company?
• Choosing the right manufacturer
• Setting a pricing strategy
• Can I start a clothing company with no money?
• Your new startup
  

Before you jump straight into fabric swatches and website logos, you need to establish the basic foundation for your clothing company start-up. From product designs to company admin, there’s a fair amount to consider. To help, we’ve put together a list of key items to get you up and running smoothly:

Brand and marketing:

• Strong brand concept: Define what makes your brand unique — and your target audience
• Marketing strategy: Consider how you plan to reach your customers and build brand awareness
• Online store: Start researching what website or e-commerce platform you could use to showcase and sell your products

Business admin

• Business plan: Build out a roadmap outlining your goals, strategies, and financial projections
• Company legal structure: Decide whether you want to be a sole trader or if you’d rather set up a limited company
• Business current account: If you decide to set up a limited company, you’ll need a business current account to separate your personal and business finances

Product and manufacturing 

• Tech pack: If you plan to manufacture custom clothes, this document (basically, an instruction manual for how to make your clothes) is essential so your chosen factory can produce your designs accurately
• Product designs: If you haven’t already, start getting samples or prototypes of your clothing items
• Supplier network: Research reliable manufacturers or suppliers for your materials and production

If you’ve already made some headway with the above, you could focus on getting a small amount of inventory to ship — more on this a little later. 

You can start an online clothing company with relatively low overheads but there will always be some startup costs. 

Generally, clothing store experts suggest a minimum of £3,000–£5,000 for a lean online launch, but realistically, £5,000–£20,000 is a good initial number to aim for so you can manage any unexpected costs or unwelcome surprises. 

Let’s look at the key expenses you need to budget for:

Cost category	Description	Estimated cost
Product development and stock	Includes design and sampling, initial inventory and packaging	£1,000 – £5,000+
Branding and e-commerce website	Includes your e-commerce platform, logo and photography	£720 – £4,000+
Legal and admin	Includes company registration, trademarks and insurance	£320 – £550+
Marketing and advertising	Includes your initial launch	£500 – £2,000+

Here’s how each of these cost categories breaks down:

This is often the largest upfront cost for any clothing store business model. Costs for developing patterns, creating samples, and sourcing materials can add up quickly, and you’ll need to factor in everything from initial sketches to finished product. 

• Design and sampling: For a small production volume, a tech pack can cost anything from £100 – £400 each. Average pricing across the fashion industry is £250 per tech pack
• Initial inventory: Pricing depends on your manufacturer’s Minimum Order Quantity (MOQ). Understandably, most small businesses want to start with a low-risk MOQ, but ordering large quantities can reduce your final costs. Generally, for a small initial run of basic items, it’s sensible to budget £1,000–£5,000
• Packaging: Custom tags, labels, and branded shipping materials can cost anywhere from less than £1 to £3 per unit. It’s a good idea to do some research on the type of tags you want to use because the material can impact the cost (e.g. printed clothing labels can be made from materials like cotton, satin, nylon, polyester and taffeta, and each has a different look,  feel, and price point)

There are a huge number of website builders and branding tools out there, so before you get too bogged down in the different providers, it’s a good idea to start by planning what features your clothing website might need — like product pages, search functionality, and easy product filtering. 

• E-Commerce platforms: You can expect to pay about £20-£50 per month for a popular e-commerce platform like Shopify. View the full Shopify price list to see the different options available 
• Logo and branding: Professional design work can range from £300 to £3,000 for a full brand identity pack. But free logo design tools like Looka could be a good place to start if you want to keep costs low 
• Professional photography: You absolutely need excellent product shots! Budget £400–£1,000 for a comprehensive but high-quality first shoot, which could be done in half a day

Before you start, it’s a good idea to register your business and even protect your intellectual property so others can’t copy your brand or clothing designs. 

• Company registration: You can do this yourself on the Companies House website (£50) or use a company registration service like Countingup for just £12. Our team will handle your application for you, and you’ll be ready to trade within 24 hours
• Trademark registration: The cost to register a single trademark in the UK is £170 for an online application or £200 for a paper application. This fee covers the registration for one class of goods or services. Additional classes cost £50 each
• Insurance: How much you pay depends on the insurance policies you need, but you can expect to pay about £100 – £300+ per year — for example, you may choose small business insurance, public liability insurance, and product liability insurance

You definitely need to tell the world you exist, so consider what marketing and advertising you might need for an initial launch. For a new clothing company, it’s a good idea to focus on developing a strong social media presence.

As a benchmark figure, budget between £500–£2,000 for your clothing company’s launch. This includes the following marketing activities:

• Social media: Build a strong presence on Instagram and TikTok by creating engaging video content 
• User-generated content (UGC): Encouraging customers to share photos and videos of themselves wearing your clothes
• Influencer marketing: Partner with influencers to promote your products to their audiences
• Email marketing: Build an email list to nurture your leads with newsletters, promotions and exclusive offers down the line

As you can see, costs can range from a few hundred pounds to a few thousand for a more ambitious launch — the scale of your launch is really up to you.

The road from initial idea to full brand and product launch can feel quite long, but if you break it down into these steps, you’ll be trading before you know it. 

The way you operate will significantly impact your costs, inventory, and production. Consider these three common clothing company models:

• Print-on-demand (POD): As the name suggests, this is where T-shirts are printed on demand (after a customer orders) and shipped by a third-party partner. 

Pros: Zero inventory risk, very low startup cost (you just pay the monthly website fee)
Cons: Lower profit margins, less control over quality and packaging

• Private label: You buy pre-made, blank garments (like hoodies or caps) in bulk and add your own branding, labels, or embroidery. 

Pros: Faster to market, less design complexity, moderate upfront costs 
Cons: Limited uniqueness, reliance on the manufacturer’s quality

• Cut and sew: You design the garment from scratch, buy the raw fabric, and pay a manufacturer to make it entirely to your specification. 

Pros: Complete creative control, unique products, potentially higher quality
Cons: High upfront costs, complex production process, high minimum order quantities.

Your pricing and inventory strategy will be closely tied to your chosen business model, so it’s worth planning which model works best for your setup. 

For example, the print-on-demand model allows for an on-demand inventory, while a cut and sew approach requires significant stock management and logistics. Do you have the space and production setup for this?

Your brand name should be memorable, reflect what you stand for, and ideally, be available. Here are a few tips for choosing your brand name wisely:

• Reflect your brand: Does your preferred name reflect your style, target audience, and brand values?
• Keep it simple: If your brand name is easy to pronounce and spell, it’ll be easier to find online and on social media
• Check availability: Make sure your name isn’t already registered by another company and that the domain name and social media handles are also available. You can use a company name availability checker to see if your preferred company name is available to register on Companies House 
• Consider future growth: Try to choose a name that won’t limit you if you expand your product range — this will save time and money in the long run 

Even if you’re using the Print-on-Demand model, you should make sure that you’ll be able to fulfil customer orders as soon as you’re open for business. This involves preparing and planning your entire product setup:

• Sourcing fabric: You should identify reliable suppliers — you don’t want to be let down by the quality of the material or any unexpected changes to it
• Finalising designs: Make sure your patterns, graphics, or specifications are perfect and ready to go
• Manufacturer arrangements: Establish clear communication and contracts with your chosen production partners — make sure you’re totally happy with your arrangement before committing 
• Get stock ready: If your chosen business model requires inventory, it’s a good idea to make sure your initial collection is produced and available before launch

Once you’ve decided on your business name and model, it’s time to make your business official.

New clothing company founders usually trade under the sole trader or limited company business structures. 

Limited companies offer limited liability, which protects your personal assets, like your home and your car, if your clothing company runs into debt. If you decide to form a limited company, you’ll need to complete the company registration process with Companies House.

Don’t worry, the company registration process is simpler than it sounds, especially if you use a company formation provider like Countingup. Our team handles the Companies House application for you — you just need to provide us with a few personal details like your name, address and date of birth, and some information about your new clothing business. We’re on hand to help every step of the way. 

Once your company is successfully registered, you’re legally ready to trade — congratulations! 

This step is optional, but highly recommended in the fashion and clothing industry. 

A trademark protects your brand identity, like your business name and your logo, from being used by a competitor.

While there are costs and fees involved in the process, securing a trademark means that if another company tries to copy your look or brand, you can legally oppose them. It’s a long-term investment in your start-up. 

For most startup clothing businesses, your first store is likely to be a functioning e-commerce shop. Here’s what you need to do:

1. Choose your platform: Shopify, BigCommerce, or WooCommerce are popular choices
2. Design your storefront: Create an attractive and user-friendly website that reflects your brand
3. Set up product listings: Write compelling and clear descriptions and specify product variations like sizes and colours
4. Integrate payments: Set up a payment platform (like Stripe, PayPal, or your chosen platform’s native payment service) to securely accept customer card payments. Remember, most providers charge a small transaction fee — for example, Stripe is currently charging 1.5% + 20p on standard UK cards 
5. Upload quality photos: Use professional photography — you want to showcase your products well and convince shoppers to click ‘buy’
6. Logistics and shipping: Plan how you’ll manage orders, packaging, and shipping

Once your store is ready, it’s time to tell the world. Remember, launching your clothing store is just the beginning — your first few months are all about getting your brand noticed by the right people. 

This involves active, consistent marketing: you could post regular high-quality content on platforms like Instagram and TikTok, set up some social media advertising, or engage directly with your audience.

Remember, in 2025, consumers often choose to buy from small brands because they value personal connection, authenticity and transparency — so don’t be afraid to be bold, have something to stand for, and be you. 

Unlike food or health products, the regulatory requirements for clothing companies are relatively light, but there are some legal responsibilities to keep in mind. Here are the key types of insurance and licences to consider (and some beneficial additions):

1. Public liability insurance

Responsibility level: Recommended

If you plan to attend physical markets, pop-up shops, or trade shows, public liability insurance protects you if a member of the public is injured or their property is damaged because of your business.

2. Product liability insurance 

Responsibility level: Essential

This protects you if a garment you sell is faulty and causes injury, illness, or damage to a customer (e.g. a type of dye causes a skin reaction). Given you’re selling physical goods, this is a sensible cost to factor in — even just for peace of mind.

3. Labelling laws 

Responsibility level: Essential

In the UK, clothes must carry a clear label stating the fabric composition (e.g. 100% cotton) and appropriate care instructions.

4. Intellectual property protection

Responsibility level: Optional

If you are concerned about your brand, your designs, or prints being copied, you can officially register your designs and trademark your business name or logo to get stronger protection.

Your manufacturer is your most important business partner — after all, they’re responsible for the quality, look, and feel of your final product. 

It’s worth taking some time to assess your options. To help, here is a snapshot of common manufacturing models and which businesses they suit:

Model	Pros	Cons	Best suited for
Local (UK-based)	Easier communication, better quality control and faster turnaround	Higher costs and limited capacity for very large orders	Small to medium-sized brands focused on quality or unique, smaller runs
Overseas (China, Turkey etc.)	Lower production costs, high capacity and a wider range of specialisations	Communication barriers, longer lead times, shipping complexities and potential ethical concerns	Brands with larger production volumes seeking cost efficiencies or specific expertise
Fair Trade/Ethical	Ensures fair wages, safe conditions and strong appeal to ethically conscious consumers	Can be more expensive than conventional overseas options	Brands prioritising sustainability and ethical practices — regardless of location

Ideally, you want to set a pricing strategy that covers all your costs and makes a healthy profit. To get you on the right track, start by considering these cost factors and pricing concepts:

• Direct costs: Raw materials, manufacturing, packaging, and shipping
• Operating expenses: Website fees, software subscriptions, insurance, and marketing
• Gross profit margin (GPM): This is the percentage of revenue left after subtracting the cost of goods sold. A healthy GPM allows you to cover operational expenses and make a profit. How you calculate this is detailed below 
• Competitor pricing: Research what similar brands are charging
• Value perception: Can you figure out what your target audience is willing to pay for your brand’s unique value proposition? Are you a budget brand, mid-range, or luxury?

Gross profit margin
Your gross profit margin is the percentage of your revenue left after subtracting the cost of goods sold (COGS). This is the amount you have left to cover all your operating expenses.

• Formula: Gross profit margin = (revenue – COGS / revenue) x 100

A healthy gross margin for clothing and apparel is typically between 50–60%. If your margin is lower than 40%, you may struggle to cover your costs, pay yourself, and turn a profit. For example, if a shirt costs £10 to make, you should aim to sell it for at least £20, but ideally more like £25 to £30 to give yourself room to grow and run more marketing and brand activities.

This is a common question. While it’s technically possible to start a clothing company with very little upfront capital, it’s highly unlikely you’ll have no costs at all.

If you genuinely have zero or very little funds, your only real option is using the print-on-demand (POD) model combined with a free e-commerce platform trial. However, after your free trial, you’ll need to pay for the website hosting. And then there’s other costs, like marketing. 

The best way to approach starting a clothing company is to be realistic, and find ways to keep costs as low as possible. Here are a few ideas on how you can do this:

• Start small: Begin with a limited product range or just a few designs
• Where possible, do it yourself: Design your own logo, take your own product photos — be as resourceful as possible (even ask friends to help) 
• Use free marketing channels: Focus on organic marketing — create great content on Instagram and TikTok (instead of running paid ads)
• Proof of concept: Test your designs with a small audience before committing to large production runs
• Crowdfunding: If you have a solid idea and a small audience already, you could try pre-selling your first line via a Kickstarter campaign. This could fund your initial MOQs when you’re ready for a proper launch. If you need more funding inspiration, we have a helpful guide on funding for fashion startups

Starting a clothing company is an exciting venture that takes a lot of passion and creativity. By carefully planning your business model, product logistics and finances, you can build a successful clothing company that your customers love. 

We hope you now feel ready to take the next step. Once you’ve registered your company, the most important thing to manage is your ongoing financial commitments with your suppliers, partners and customers — and we can help with this. 

Our business current account app is built specifically for small limited companies — it automatically tags transactions and even prepares your tax data, so you can spend less time reconciling invoices and more time creating your next killer clothing collection. 

You need to register your clothing company with Companies House — Countingup’s company registration service makes this quick and easy. Before you do this, make sure to use our company name availability checker to ensure your chosen business name is unique and available.

You can absolutely start a clothing company from home, especially if you opt for an online-first model or use print-on-demand services. This involves setting up your e-commerce store, managing designs, marketing, and potentially handling packaging and shipping from your home office.

It’s hard work, but achievable! The production side can be complex (sourcing and sampling), but the commercial side — setting up an online shop and marketing — has never been easier. With a focused plan and a strong brand vision, you’ll find starting a clothing company very rewarding.