![How to plan and track the budget of your denim brand [template]](http://onlineyougrow.com/cdn/shop/articles/cov-budget-4_09cd54a3-f301-4003-97fe-ffd8e582d955.png?v=1715856418&width=1100)
If you don’t plan and track your denim brand's budget properly, you're setting yourself up for failure.
When we developed our strategy pack for denim brand owners, we saw a lot of entrepreneurs struggling with finances and planning.
They were disorganized, had no grasp of cash flow, and were drowning in financial troubles despite having substantial sales.
Don’t let this be you—stand out and succeed.
We’ve created a small, free tool to help you get started: our Budget Tracker and Planner. Let’s turn your denim brand's finances around and set you on the path to success!
Get the budget tracker tailored for denim brands
Most denim brand founders don't know how to plan and track their budget. This spreadsheet will help you.
Example of a full budget for denim brands
Here is an example of a (very) detailed budget for a denim brand, to give you some inspiration
1. Rent and Utilities
| Item | Description | Monthly Cost | Annual Cost |
|---|---|---|---|
| Rent | Lease for retail and office space | $4,000 | $48,000 |
| Electricity | Power consumption for store and office | $600 | $7,200 |
| Water | Water usage | $150 | $1,800 |
| Internet & Phone | Internet service and business phone | $100 | $1,200 |
| Waste Removal | Garbage and recycling services | $80 | $960 |
| Pest Control | Monthly pest control services | $50 | $600 |
| Insurance | Property and liability insurance | $400 | $4,800 |
2. Salaries & Wages
| Position | Number of Employees | Monthly Cost per Employee | Total Monthly Cost | Annual Cost |
|---|---|---|---|---|
| Store Manager | 1 | $3,500 | $3,500 | $42,000 |
| Sales Associates | 3 | $2,000 | $6,000 | $72,000 |
| Marketing Specialist | 1 | $3,000 | $3,000 | $36,000 |
| Designer | 1 | $4,000 | $4,000 | $48,000 |
| Warehouse Staff | 2 | $2,500 | $5,000 | $60,000 |
3. Inventory & Supplies
| Item | Description | Monthly Cost | Annual Cost |
|---|---|---|---|
| Denim Fabric | Raw materials for jeans production | $8,000 | $96,000 |
| Thread & Notions | Thread, buttons, zippers, etc. | $1,000 | $12,000 |
| Packaging | Boxes, bags, and tags | $500 | $6,000 |
| Cleaning Supplies | Detergents, sanitizers, etc. | $100 | $1,200 |
| Office Supplies | Stationery, pens, printer ink, etc. | $150 | $1,800 |
4. Marketing & Advertising
| Item | Description | Monthly Cost | Annual Cost |
|---|---|---|---|
| Online Advertising | Google Ads, Facebook Ads, etc. | $400 | $4,800 |
| Social Media Management | Managing social media accounts | $600 | $7,200 |
| Print Advertising | Flyers, posters, magazine ads | $250 | $3,000 |
| Website Maintenance | Hosting, domain, updates | $150 | $1,800 |
| Email Marketing | Email campaigns and newsletters | $200 | $2,400 |
| Promotional Events | Special events and promotions | $300 | $3,600 |
5. Miscellaneous Expenses
| Item | Description | Monthly Cost | Annual Cost |
|---|---|---|---|
| Equipment Maintenance | Regular maintenance of sewing machines and other equipment | $300 | $3,600 |
| Uniforms | Staff uniforms and aprons | $150 | $1,800 |
| Licenses & Permits | Business licenses, trademarks, etc. | $100 | $1,200 |
| POS System | Point of Sale software and hardware | $200 | $2,400 |
| Contingency Fund | Emergency repairs and unexpected costs | $400 | $4,800 |
| Staff Training | Training programs and materials | $200 | $2,400 |
Some denim brands make 5x more profit than you!
We have studied the strategies of the best denim brands in the world. Replicate them now!
What are the biggest expenses for a denim brand?
Be mindful of these pitfalls. Here are five major costs every denim brand owner needs to consider, along with some tips on how to manage them effectively.
- Raw material costsDenim fabric and other materials can take up a significant portion of your budget. Prices can vary based on quality, availability, and market demand. To keep these costs under control, focus on bulk purchasing, negotiate better deals with suppliers, and minimize waste. It's easy to overspend by opting for premium materials that don’t necessarily add enough value to your products.
- Labor costsYour team is essential, but paying for their wages, benefits, and training can be costly. This expense is always high because you need skilled workers to ensure high-quality production and efficient operations. You can optimize labor costs by scheduling efficiently, cross-training employees, and monitoring productivity. However, be cautious not to underpay or overwork your staff, as this can lead to high turnover and poor product quality.
- Rent and utilities for your production facilityPrime locations come with high rent, but they can enhance your brand's image. Utilities like electricity, water, and gas are necessary but can add up quickly. To optimize these costs, negotiate favorable lease terms and invest in energy-efficient machinery and lighting. Overspending often occurs when you choose a facility that's too large or too luxurious for your needs.
- MarketingGetting the word out about your denim brand is crucial, but advertising can be expensive, whether it's online ads, social media campaigns, or traditional media. Optimize this expense by focusing on cost-effective methods like the ones we recommend in our guide. Overspending can happen if you invest in flashy campaigns without a clear return on investment.
- Equipment and maintenance costsThis includes everything from sewing machines to cutting tables. These are expensive because high-quality equipment and regular maintenance are essential for smooth operations and product quality. Optimize by investing in durable, energy-efficient machinery and maintaining it regularly to avoid costly breakdowns. You can overspend by going for the latest high-tech gadgets you don’t really need.
How to spend less with your denim brand?
Here are practical tips to help you, as a denim brand owner, optimize your budget and manage expenses more effectively.
| Expense | Tips to Optimize |
|---|---|
| Fabric Costs | Partner with sustainable fabric suppliers for high-quality materials at competitive prices. |
| Labor Costs | Implement a workforce management software to optimize staff hours and reduce overtime. |
| Utilities | Install energy-efficient lighting and machinery in your production facility. |
| Marketing | Run social media campaigns for your denim brand and collaborate with fashion influencers for organic exposure. |
| Production Supplies | Train staff on efficient use of production supplies to minimize waste. |
| Equipment Maintenance | Set up a maintenance log for regular checks and servicing of sewing machines and other equipment. |
| Rent/Mortgage | Negotiate lease terms during renewal or consider moving to a more cost-effective location. |
| Insurance | Regularly review insurance policies to ensure they meet current needs and compare rates annually. |
| Packaging | Use cost-effective, eco-friendly packaging and offer discounts for customers bringing their own bags. |
| Display Fixtures | Invest in high-quality, durable display fixtures that can withstand frequent use. |
| POS System | Choose a POS system that offers essential features with low transaction fees and integrates with inventory management. |
| Staff Training | Conduct regular in-house training sessions and use free online resources. |
| Waste Management | Implement a fabric waste tracking system to minimize waste and donate excess materials. |
| Technology | Invest in multi-functional sewing machines and utilize production management software for efficiency. |
| Office Supplies | Purchase supplies in bulk and go paperless where possible with digital order systems. |
| Inventory Management | Use inventory management software to track stock levels and reduce overproduction. |
| Pest Control | Schedule monthly pest control services and maintain cleanliness standards to prevent infestations. |
| Music and Ambiance | Use a streaming service for in-store music and host local artists for special events. |
| Uniforms | Choose durable, easy-to-clean uniforms for staff and offer a stipend for maintenance instead of using an external service. |
Copy the tactics of the best denim brands in the world!
There are denim brands that make way more money than you do. We have studied their tactics. Get them now!
Expenses that are just useless for a denim brand
Yes, some expenses for your denim brand are just unnecessary. They don't contribute to increasing revenue or enhancing customer satisfaction.
| Denim Brand Expense | Reason It's Unnecessary |
|---|---|
| Luxury Packaging | Overly elaborate packaging doesn't necessarily attract more customers and can be a drain on the budget. |
| High-End Fabric Treatments | Unless you are targeting a niche market, most customers are satisfied with standard fabric treatments. |
| Excessive Product Lines | A large product line increases inventory costs and leads to more unsold items. |
| Top-Tier Machinery | Top-of-the-line manufacturing equipment is not always necessary and can be cost-prohibitive. |
| Print Advertising | Traditional print ads often have a lower return on investment. Don’t include them in the marketing strategy of your denim brand. |
| Multiple Label Designs | Having various label designs increases costs without adding significant value to the customer experience. |
| Excessive Staff | Overstaffing leads to higher labor costs without necessarily improving product quality. |
| Premium Subscription Services | Expensive subscriptions for industry reports or magazines often go unnoticed by customers. |
| Exclusive Denim Materials | Using rare materials can inflate costs and complicate supply chains. |
| Costly Store Fixtures | High-end store fixtures are not always appreciated by customers and can be a significant expense. |
| Custom Printed Tags | Personalized tags are a minor detail that most customers overlook, and they can be expensive. |
| Unnecessary Software | Paying for software with features you don’t use is a waste of resources. |
| Premium Water Brands | Most customers are content with filtered tap water, making expensive bottled water unnecessary in your stores. |
| Extra Delivery Vehicles | Maintaining a larger fleet than needed increases operational costs. |
| Excessive Membership Fees | Paying for multiple industry memberships often yields little benefit. |
| Overly Frequent Store Renovations | Constantly updating store decor and layout can be costly and disrupt operations. |
| Expensive Store Displays | Elaborate displays are often ignored by customers and add to the cost. |
| High-End Store Fixtures | Luxury fixtures are prone to damage and expensive to replace, often going unnoticed by customers. |
| Excessive Staff Meetings | Too many meetings can reduce productivity and increase labor costs. |
| Expensive Catalog Designs | Frequently redesigning catalogs is costly and often unnecessary. |
| Unused Promotional Materials | Ordering more promotional items than needed leads to waste and unnecessary expense. Get our marketing budget planner template. |
| Paid Directory Listings | Many free listing options are available, making paid listings often redundant. |
| High-End Manufacturing Equipment | Specialized manufacturing equipment is often unnecessary and adds to costs without a proportional benefit. |
Stop working with a tight budget for your denim brand!
Managing a budget for a denim brand when funds are tight can feel like an uphill battle. It's like being stuck in a cycle where any unexpected expense can throw you off balance.
This constant pressure makes it nearly impossible to invest in growth projects, leaving you always scrambling to cover costs. It's a life filled with stress and sleepless nights.
Yes, you can continue down this path, cutting corners and barely making ends meet. But there's another part of the equation you might be overlooking. Instead of just trying to cut costs, you can focus on growing your revenue. More income means more flexibility and more resources to invest back into your brand.
And no, you don't necessarily have to spend money to grow. There are plenty of zero-cost initiatives and strategies that can help you increase your revenue by 10%, 20%, or more. We've detailed all of these strategies in our guides, after studying dozens of denim brands just like yours. Get them now!
Make your denim brand more profitable
We have studied the strategies of the best denim brands in the world. All their tactics are explained in our pack!
