How to scale your clothing brand in 19 minutes

Summary

Dave Nash, an experienced e-commerce entrepreneur, shares his foolproof five-step strategy to scale a clothing brand successfully. With over ten years in the industry and two brands earning $500k monthly, Dave discusses vital elements like setting profitable margins, creating captivating content, leveraging Facebook ads for predictable growth, ensuring exemplary customer experiences, and optimizing funnels for broader reach. He emphasizes the importance of patience in building a sustainable brand over time, highlighting how incremental improvements can lead to exponential growth, as evidenced by his impressive journey from $500k to over $2 million in annual revenue.

Highlights

• Understanding the importance of profit margins, with at least a 75% margin on items over $100 🔍.
• Investing appropriately in high-quality content to maximize marketing impact 📸.
• Harnessing the power of Facebook ads for reliable and scalable business growth 📊.
• Providing exceptional customer service to foster brand loyalty and repeat sales 🤝.
• Strengthening website and sales processes to improve conversion rates and customer retention 🌟.
• Emphasizing the long-term game of consistency and patience in scaling a brand ⏱️.

Key Takeaways

• Master the margins: Ensure high profit margins, with a 75% profit margin on products over $100, and a 5x markup on products under $100 💰.
• Content is king: Invest 5-10% of projected revenue into high-quality, varied content to boost brand visibility and engagement 🎥.
• Ads amplify: Use Facebook ads for consistent and scalable traffic, ensuring a solid return on ad spend 📈.
• Customer experience matters: Provide fast shipping and excellent customer service to encourage repeat purchases and positive word-of-mouth 🔄.
• Tighten the funnel: Optimize your website and customer follow-up strategies to convert browsers into buyers efficiently 🌐.
• Patience and consistency: Success in the apparel industry takes time, requiring dedication to these strategies over years ⏳.

Overview

Dave Nash opens up about his proven method to scale clothing brands, rooted in his extensive experience in the e-commerce sector. He stresses the importance of achieving high profits through strategic price-setting and margin optimization, key to surviving the costly Facebook ads landscape.

Next, Dave delves into the significance of high-quality content, urging brand owners to allocate a significant percentage of their projected revenue towards varied and engaging content forms. This ranges from beautiful photography to compelling TikTok reels, forming the backbone of a strong marketing push.

Finally, Dave covers the necessity of refining customer experiences and website performance. With these elements nailed down, he believes ambitious brands can eventually scale from thousands to millions in annual revenue, provided they remain patient and committed to their development over time.

Chapters

• 00:00 - 05:30: Introduction and Profit Margins This chapter, titled 'Introduction and Profit Margins,' features a video transcript by Dave Nash on scaling a clothing brand. Nash introduces foundational steps for business success, aiming to simplify the path to wealth. Broadcasting from his Los Angeles office, he shares his achievements, including over eight figures in revenue and a decade of e-commerce experience, particularly in the apparel industry where he currently operates two brands.
• 05:30 - 09:30: Importance of Content The chapter titled 'Importance of Content' discusses key steps to achieve significant monthly revenue, specifically 500k. The speaker emphasizes the accessibility of these steps, catering to beginners, intermediates, and advanced individuals in business. The chapter outlines these steps as a daily blueprint for success, highlighting the first step concerning the understanding and management of profit margins, a common area of inquiry. While the full steps are not detailed in the provided transcript, the emphasis on margins sets the tone for practical financial strategies.
• 09:30 - 12:00: Running Facebook Ads The chapter titled 'Running Facebook Ads' focuses on determining profit margins for products sold. It provides a framework particularly for products priced above $100, emphasizing the necessity of at least a 75% profit margin. This means that for a product sold at $100, a gross profit equivalent to 75% of the sale price must be achieved. The chapter seems to extend into further strategies or details, which are not provided in the given transcript excerpt.
• 12:00 - 15:00: Customer Experience The chapter discusses pricing strategies and profit margins in the context of customer experience. It emphasizes the importance of achieving significant markup on products to ensure healthy profit margins. Specifically, if the cost to land a product in the warehouse is $25, it should ideally be priced between $120 and $130, aiming for a 5x markup, which equates to an 80% gross margin. Additionally, it notes that for products priced under $100, a different profit strategy might be necessary.
• 15:00 - 19:00: Optimizing for Scale The chapter 'Optimizing for Scale' discusses pricing strategies and profit margins. It emphasizes the importance of a 5x markup to achieve an 80% gross margin. For instance, buying a product for $18 should ideally be sold for $90, or better yet, $95 or $100. This ensures profitability even with organic selling methods.
• 19:00 - 20:00: Conclusion and Patience The chapter discusses strategies for scaling an apparel business to generate significant monthly revenue, specifically focusing on the use of Facebook ads. It highlights the importance of having a high markup on products to achieve necessary profit margins, suggesting a minimum markup of 4 times for products over $100 and 5 times for those below $100, to ensure successful ad scaling and profitability on Facebook.

How to scale your clothing brand in 19 minutes Transcription

• 00:00 - 00:30 what is up YouTube this is Dave Nash welcome back to the channel this video is how to scale your clothing brand in 13 minutes or less um it's about five or six foundational steps that if you follow you'll basically have a foolproof method on how to get rich like me I'm in my office downtown LA as you can see the view is pretty great it's a nice sunny day in La as it is every single day um a little backstory I've done over eight figures in Revenue been doing e-commerce for 10 years and right now I'm in the apparel Niche I have two brands that are
• 00:30 - 01:00 doing 500k a month that's a half a million every single month so just listen up to these five or six steps and you will know how to do exactly the same um these steps work for beginners intermediate and advanced I follow these five steps in my business every single day so make sure that you listen so you can just basically just get the blueprint okay so let's get started because I said we only have 13 minutes the first one is according to my list margins let's talk about margins so a lot of people are always asking me what a good is like do do I mark it up by
• 01:00 - 01:30 2.5x 3x 4X 5x I I have to let you know that here's my framework for determining profit margins on the products that you're trying to sell so for above $100 products you need to have at least a $75 sorry a 75% profit margin so what that means is that you need to make 75% profit uh gross profit gross margin on the sale price so if you're selling it for $100
• 01:30 - 02:00 that means the max you can get your product for landed in your Warehouse is $25 that's about a 4X so that's $75 a profit margin and that's the bare minimum if I was going to get something for $25 ideally you want to price it for $120 or $125 $130 so you can get that kind of like 5x markup that we're all looking for which is 80% gross margin profit now if your product is under $100 you need at least
• 02:00 - 02:30 a 5x markup which is 80% gross margin on the product so for example if you're getting a hoodie for $18 5x of that is let me do the math $90 so if you are getting your hoodie landed for $18 then you need to sell it for $90 um preferably $95 or $100 and yes you can sell any product if you're doing organic methods like you get it for 20 you sell it for 60 sell hundreds of
• 02:30 - 03:00 units whatever that is true but the way that I've been able to scale to half a million a month in apparel is through Facebook ads and Facebook ads are expensive and if you're not having at least a 5x 4.5x markup on every single product you sell I don't care if it's a shirt jeans hoodie whatever it is if you don't follow the rules of at least a 4X markup above $100 or at least a 5x Market markup below $100 you are just simply not going to get the scale that you need on Facebook Facebook to hit 3
• 03:00 - 03:30 million a year 5 million a year and hopefully 10 to 20 million per year in annual revenue another thing to note about margins is that there's two aspects that control what your profit margin is right so like this side and this side so this side is your cost that you're getting it for and this side is the price that you're selling it at apparel Brands and business in general e-commerce in general is just a constant Improvement of widening this
• 03:30 - 04:00 Gap so that you have the biggest margin as possible like at first you get your hoodies for $25 you sell it for $65 over time you know you switch suppliers you you you know go to Alibaba you do whatever it takes to get lower and lower prices you negotiate harder you order more quantities so you can get better pricing now you're getting your hoodie for $20 so now it's $20 to 20 to $65 um and now you just keep increasing your price as you get more brand Equity
• 04:00 - 04:30 so that you have $75 hoodies now you have $85 hoodies and not only do you have more brand Equity brand identity to increas keep increasing your prices but hopefully your designs will get better and better with every year so that you can start charging $100 because the price that you choose to sell your products at you can't just arbitrarily choose it you have to like deserve that price through your designs just because you want a 5x markup on your hoodie doesn't mean you deserve to sell a
• 04:30 - 05:00 hoodie you can design a [ __ ] hoodie and you can't sell it for $100 cuz it's not good enough and no one wants it at $100 relative to all of your competitors who look exactly the same that will are selling it at 6570 $75 so this side is really just like grinding it out you know negotiating hard finding new suppliers to get your cost low and this side is like just existing for a long time to build up your brand Equity investing in content to build up your brand image so that you can command
• 05:00 - 05:30 higher and higher uh price on all of your products as well as improving your designs so that they're unique enough to Warrant being sold at a high price ideally you would want to se get your hoodies for 20 and sell it for 125 but you can't do that unless you work on both sides of the equation most of you right now are probably getting hoodies for $30 selling it for $65 $35 profit margin that's not going to work with Facebook
• 05:30 - 06:00 so once you fix your margins because like the basis of every business is your profit margin that is literally like the that's that's the equation that rules your business your profit margin if you have amazing content and your profit margin is small you'll basically just be broke but if you have a big profit margin you can just be average at everything else and you could still do pretty well um which Segways into my next point which is content so once you have really good profit margins now step two is you can focus on content and
• 06:00 - 06:30 content um a lot of people always ask me like what is how much should I invest in content how much are your shoots um what I would say is like take about 5 to 10% of what you think that drop is going to do for example if you're going to do 50k on a drop over say like a two to four week period post drop you want to invest about 5 to 10% probably around 8 to 10% of that projected revenue on your content so if
• 06:30 - 07:00 you're doing 50,000 then you want to spend at least $3 to $5,000 on content which includes models photographer cost um you know hair makeup styling travel whatever it costs to get a lot of good content and that's varied content so flatlays uh e-commerce photos white background you know lifestyle photos videos reals Tik Tok whatever it takes spend three to four, because that spend
• 07:00 - 07:30 that you put in content is going to go a long way you use that on your website you use it on your emails you use it on your SMS you use it on your um on your ads you use it on Tik Tok for organic viral traffic use it on your Instagram you you do feed posts with it to build your brand and you do reals so you can get new traffic through organic viral methods content goes a long way and the best thing about content is that it's Evergreen I have products that I dropped in 2023 I shot some content for it then or I gave give it to some influencer
• 07:30 - 08:00 they're doing like ugc whatever um and Those ads are still running over a year later it's still spending you know $50 to $100 a day bringing in 00300 $400 in Revenue which means that specific ad from a product in 2023 that was created the ad was created in 2023 is still bringing in 10k a month now if you keep stacking up all of those winning ads and winning products over time now you have five to 10 pieces of
• 08:00 - 08:30 content that are all bringing in $200 to $300 in Revenue every day that's like two to 3K a day and that's 100K a month easy right so like make sure that you're investing into content and the bigger your brand gets like for example if we're doing 200k a month then I will invest at least 10 to 15,000 per month in content because a clothing brand like what is it right it's clothes and content there's only two things you invest in your clothes to research and develop them produce them sample them Etc then you invest in your content
• 08:30 - 09:00 because the content is what the customers and the market in general is interacting with to learn about your brand build a brand affinity and basically they're buying the clothing based on the content that you produce really [ __ ] clothing can be marketed with amazing content and people will buy it but if you get the nicest clothing in the world and you don't invest in content you're just shooting it on some old digital camera in shitty lighting and you post on your feed bro no one's going to buy that so like that just goes to show that content is like 66% of the battle actually one thing I say is like
• 09:00 - 09:30 when it comes to content is like the clothing is 33% uh the content quality is 33% and then believe it or not the model that you choose and also include hair and makeup and styling into that um you know into that mix the model and the way that the clothes sit on the model the way the model looks the way the model represents your brand the hair and makeup and that's applied to that model that is 33% because if you take a really cool shoe and you choose the wrong model
• 09:30 - 10:00 like you you basically choose a model that doesn't fit your brand or is not pushing the brand identity that you want you're basically going to get nowhere so make sure that you choose the right model because it's it's basically onethird of an entire content strategy so choose the right models for your brand okay so now we have the margins step one step two is you need the good content and make sure that you're investing a proper ratio of content that uh into the content as what kind of Revenue that you're going to be doing um now you're going to just want to run Facebook ads and I personally don't run any organic
• 10:00 - 10:30 viral strategies because I just personally for me Facebook ads make sense I love to get predictable consistent traffic on a daily basis I put in $1,000 I get out $2,500 every single day and on top of that it just brings new people into the funnel every single day whereas organic as you all know could be up and down down or up basically you don't really have control obviously if you are a
• 10:30 - 11:00 master an absolute master in organic vile strategies I know some of you are by all means focus on that as your main uh you know source for traffic I wish I was amazing at organic viral traffic because it's free it just costs kind of like your time but unfortunately you know I I wasn't growing up in the Tik Tok generation I just know Facebook ads I've been running Facebook ads for almost 10 years spending over five probably 5 six million of my own personal money to run the Facebook ads I
• 11:00 - 11:30 so I just know how to run them so that is my core competency I set up my entire business from the profit margins so the content you know ratio to basically the whole funnel the way my whole p&l is structured around spending around 30% of my revenue on Facebook ads every single month and then that just gets me to like a profitable state where my net profit every month is between 10 and 25% depending how big that month's drop was or if I had any marketing events Black Friday etc etc so Facebook ads is
• 11:30 - 12:00 basically like the key to like the whole strategy it's make the product with a good product profit margin with a good design that warrants the high price you invest in content then you spend a ton of money on Facebook ads because what Facebook ads does is it is simply an amplification of your business model your business model meaning your content and your clothing Facebook is basically like a megaphone that says hey everyone I have clothing and I presented it in
• 12:00 - 12:30 this way come look and you pay Facebook to serve that message to the market and that market will or will not resonate with your content and your clothing and if it does they go to your website they purchase bada bing bada boom you are now wealthy and an upper class citizen okay so now once you run the Facebook ads you have the content Etc you get the customers fourth step is that you need to fulfill your orders
• 12:30 - 13:00 very fast which means that obviously we're not doing pre-order here um and you need to give your customers an exceptional experience the reason we need to do this is because there is not an infinite amount of people in the world right in your target market it might only be two three four million people and once you start pissing all of the customers off in that Niche or in that market you are your your list of customers that you can sell to is dwindling like every single day that you
• 13:00 - 13:30 have bad experience for your customers um whereas if you have a good experience for customers these customers are actually going to they're going to have two two effects LTV Word of Mouth they're going to purchase again and again and again because of a good experience and they're going to wear the clothing often tell their friends and then they can get you other customers for free what is the inverse of that well if you have give them a bad experience a bad experience meaning the delayed ship times pre-order method not
• 13:30 - 14:00 responding to their customer service inquiries Etc bad quality of clothing no exchanges no re refunds no returns Etc like that what happens is that they're going to never shop with you again so if you sell to 20,000 people and you give them all a shitty experience yeah maybe you made few hundred, in profit but what are you going to do next year when none of those customers want to buy from you in 2026 um you're basically just going to be broke and I've seen a lot of brands go through this where they basically do
• 14:00 - 14:30 get pretty big like 50,000 75,000 even 140,000 uh followers on Instagram they sell they make couple hundred like a couple million dollars of Revenue and then they just fall off why it's because none of the customers that purchased from them really want to buy from them again so that's a risk that you're taking every time you do a pre-order and every time you give the customers a bad experience you want to just give everyone a good experience so that no one can say anything bad about you and that is how you really unlock free what
• 14:30 - 15:00 I call like free purchases like people that you already Acquired and had $50 CAC or $70 CAC to acquire well there's no more CAC anymore send them an email do a drop on Instagram they just buy byy byy by byy then they go out and they tell their friends bye bye bye bye bye and that's how you basically make a lot of money for free after you acquire customers and give them a really good experience so those are like the four main steps and then the fifth step is kind kind of like a bonus step so good
• 15:00 - 15:30 margins good product um good content run a ton of Facebook ads give the customers a good experience that's literally all you have to do to make1 million in apparel just do those four steps the fifth bonus step which is how you kind of like okay that's that's how you make $1 million in apparel the fifth bonus step is really how you optimize and get to like a five or a seven or a 10 million a year in apparel and that is to tighten up the funnel so just because you can run Facebook ads um really well
• 15:30 - 16:00 just because you can make clothing with a good profit margin doesn't mean you could scale the 10 million um you can get pretty far but what I would have to talk to you about is that um there's multiple other factors that tie into this besides those few steps for example your website is your website a really good design or is it a bad design is a conversion rate optimized um do you have FAQ do you have all of your you know your refund policy and all that stuff that basically gets your customer to not have hesitations when purchasing um
• 16:00 - 16:30 that's what I mean by tightening up the funnel because you have a good product content and ads that brings people to the website but if people aren't converting at a high high enough clip then you're basically losing all that money so you're doing everything right but your website sucks another thing that might suck is like yeah your website is good but obviously naturally there's going to be people that aren't going to check out well you need to plug the funnel and tighten up the funnel by having a lot of email marketing flows that basically tell your customers like
• 16:30 - 17:00 hey like I saw you were checking this product out you saw my content you saw my clothes you saw my ad you like my website but just for one reason or another you couldn't afford it or you're just busy you didn't check out well I'm going to send an automated email that captures those customers and brings them back and that gets you kind of like that marginal kind of like incremental revenue of like maybe you make 5% Revenue extra per day 7% Revenue extra per day but that Revenue adds up and if you have all of these like tightening up
• 17:00 - 17:30 the funnel initiatives cro loyalty programs good customer service proper email flows across the funnel browse abandonment site abandonment abandoned card abandoned checkout post purchase Sunset flows like if you do all of that stuff that's what really kind of like unlock unlocks how to go from like three to five and 5 to 10 million because anyone can get to like 2 to three million a year just doing the first four steps but then the fifth step is really how you optimize and if you do all of these things this is kind of like the sixth step which is like the skill of
• 17:30 - 18:00 patience how to get to 10 20 50 100 million a year like represent or like gym shark or whatever is that you do the first four steps then the fifth step the skill of patience is applied so you do these steps over time and if you do them consistently over time if you the sixth step is having the scale to do these five steps consistently over time that's how you go from 1 million 3
• 18:00 - 18:30 million 5 million 7 million 10 million over a 10year Time Horizon represent wasn't started four years ago you might have heard of them four years ago but they were started in 2010 2012 jym shark was started 15 years ago all the companies that you know and love were actually started seven to 8 10 years ago right like it does take time but if you do the five steps for that amount of time you are 100% Going to succeed and right now I think I'm on year two of apparel I've been doing
• 18:30 - 19:00 business for a while in different niches uh exited some companies but I've been doing strictly apparel for about 2 years first year I did 500k second year I did over 2 million um and you know we're probably going to do multiple you know multiples of that this year so it's really just doing those steps consistently over time and it's really just a patience game clothing is notoriously cash intensive and also slow because product development takes couple
• 19:00 - 19:30 months to make a product sample you know get it in then you have to shoot the content and then you know if you don't sell out it takes one to two months to sell it it's just a long cash conversion cycle so you can only turn over inventory three or four times per year so it's just like a slower overall process so you need patience when it comes to the clothing game that about wraps up my video I said it was going to be 13 minutes but it looks like an 18 19 minute video hope it was valuable um I'm finally set up in La everything is going really well I'm going to be making more
• 19:30 - 20:00 videos thank you for watching um comment below make sure you leave it a thumbs up and make sure you subscribe more videos to come peace