The Tailoring Business Plan: The Number That Actually Runs the Shop

The number most plans leave out

A shop owner once sent me her business plan before her first order had even gone out. Twenty-odd pages: a competitor table, a five-year revenue projection, a full page on brand positioning. I read it and asked one question back. How many jackets do you need to alter or make in a month before you stop losing money? She did not know. Nobody had asked her to work it out, and the document meant to run her business did not contain the one number that would.

That happens more often than it should. Search for a tailoring business plan and you find templates built for a lender: market analysis, a competitor section, an executive summary nobody reads twice. There is nothing wrong with that document existing if you need a loan. But it is not the plan that runs the shop.

The plan that runs the shop is shorter, more uncomfortable, and answers a question a lender never asks: what happens the month you are completely full and still not making enough.

Sell something first

If you have not sold a single piece yet, close this document and go sell one. A business plan cannot tell you whether anyone will pay for your work. Only a client with cash out can tell you that, and no amount of competitor analysis substitutes for it. We wrote a longer version of this refusal, and what to do first instead, before you start.

A plan written before a single sale is a guess dressed up as a document, whatever the word conservative is doing in it. Sell the first piece, at a real price, to a real client. Then come back and fill in numbers that already happened instead of ones you are hoping for.

The price list, with hours beside it

Write out every service with a price beside it. Not a range, a price: take-up, taper, reline, replace a zip, a full jacket alteration, a made-to-measure suit, a made-to-measure jacket alone, a rush fee.

I have watched a dozen shop owners do this exercise, and the reaction is nearly always the same. First, they find jobs still priced from memory, at numbers set years ago. Second, they notice how much of the list is priced by the hour without anyone deciding that on purpose. A take-up is an hour of your life. So is a shortened sleeve with working buttonholes, and one of those is charged like a favour.

Then, beside each line, write how long it takes. Not how long it should take, how long it takes on an ordinary Tuesday with interruptions. That second column is where the plan lives, because it is the column that turns a price list into a capacity limit.

Your fixed number

This is the total that arrives whether or not a single customer walks in: rent, rates, utilities, insurance, phone and internet, software, any staff, and your own draw. Your own draw belongs on the list. A plan that treats the owner's income as whatever is left at the end of the month is a hope with a spreadsheet attached.

Write that one number at the top of the page, and do not round it down to make the rest of the page feel better.

Break-even against capacity

Take the fixed number and divide it by the average amount you keep on a typical job after materials. The result is how many jobs a month you need before anything is profit, and it is the first number I ask for when a shop talks to us about outsourcing production. If an owner cannot answer it inside a minute, nothing else in the conversation matters yet.

Two things tend to surprise people here: the number is usually lower than feared, and it sits closer than expected to the maximum number of jobs they can physically do in a month. That gap, between break-even and capacity, is the whole business. Wide, and more demand becomes more revenue. Narrow, and no amount of marketing closes it.

We built the mechanics of this division out in the one number worth building your model on. Read it before you fill in your own figure, because the number only means something with your own retail price inside it, not one we hand you. We do not know what your city or your client list can bear, and any figure we offered instead would be a guess wearing a decimal point.

If break-even lands at 60% of capacity, you have room to breathe. At 90%, one bad week is a loss and a good week barely helps, and working harder will not fix it.

Where clients come from

List the sources, in order of how many clients each produced in the last three months: walk-in, word of mouth, Instagram, a wedding venue that sends people over, a dry cleaner who does not do alterations, a corporate account that started with one order.

Most shops find that one or two sources produce almost everything, and that the channel absorbing the most attention is not among them. A slightly annoying discovery, and worth more than a competitive analysis.

Write down one thing you will do to strengthen the source that is already working, rather than opening a new channel.

The day the diary is full

This is the section almost every template leaves out, and the one that separates a plan from a wish. There are four moves, and the plan should name which one you are choosing.

Raise prices. Fastest, and the most uncomfortable. It works until you reach what the market will bear, and that ceiling arrives sooner than expected.

Hire. Real capacity, but it turns a variable cost into a fixed one, and skilled hands are hard to find and harder to keep. Your fixed number goes up the day they start and does not come down in a quiet month. Do this once the diary has been full for a season, not one good fortnight.

Turn work away. Legitimate, and often correct. Dropping the lowest-value jobs to make room for better ones is a strategy rather than a failure, though it caps the business permanently at your own two hands.

Outsource the making. The only move that raises revenue without raising your hours or your fixed costs. Some shops do this by adding suits to a styling service they already run. Most do it through made-to-measure produced outside the shop: you measure, choose the cloth and run the fitting, and the making happens elsewhere. The client still gets a garment cut to them, with your name in it, and a suit stops costing you a week at the bench.

Pick one and write it down. The plan is the decision, more than the analysis behind it.

Running out of time, not money

Here is the harder version of the same question, the one most owners never reach because they are still solving for cash: which month do you run out of time.

A one-person shop rarely dies of low demand. It dies of capacity. You fill your own diary, week by week, until there is no more of you to sell. I have sat with a shop two years in, fully booked, turning work away most weeks, more anxious than they were in year one, because they had just worked out that the only two doors out were hiring or outsourcing, and neither looked like the business they had opened.

Almost nobody plans for this moment, because it arrives wearing the costume of success. A full diary looks like the goal, and it turns out to be a wall.

The two doors change different things. Hiring buys more hands doing what you already do, at the cost of a fixed number that never comes back down. Outsourcing buys the same capacity at a variable cost, but only for the part of the job that can leave the building, and measuring cannot. A shop we work with still takes all 47 measurement fields themselves, in their own fitting room, because that relationship is the part of the business nobody else can run for them. What leaves the building is the cutting and sewing behind it, not the handshake in front of it.

Solve it once and the next version of the same problem shows up across a second location, covered separately here.

What you refuse to do

A short list, and a useful one. Perhaps you do not do bridal, or same-day, or a garment you did not make, after a client bought it two sizes wrong elsewhere.

Every item on this list buys back time and cuts the number of jobs you will regret. Shops without one end up defined by whatever walked through the door that week.

Questions before you outsource

What a shop needs from a production partner is narrow: single-garment orders, so a first order is a test and not a commitment; your own label in the garment; and a lead time short enough to quote honestly at the fitting.

Centi Sartoria works this way from our own workshop in Shanghai, on a one-piece minimum, so the wall in the last section can be tested with one garment before you commit to stock or a hire. Turnaround runs 14 to 20 working days once cloth and specification are confirmed, shipping counted separately. That will not make you faster than doing it yourself on a good week. It takes the making off your own bench, so the week stops belonging to one jacket.

None of that is your inventory risk to carry. The cloth, and the styles it comes in, sit with us rather than on your shelf, and nothing in that range becomes stock until a client has chosen from it. What stays yours, entirely, is the fitting: all 47 measurement fields of it, taken in your own room, by someone your client already trusts. Get one of those fields wrong and it is a mistake made on your side of the arrangement, because nobody from this side of it was standing in the room. That, more than who owns the cloth, is the line between hiring and outsourcing.

Pricing starts at €108 ex-works for a classic two-piece and €254 for a full-canvas two-piece (a construction, not a fabric, and not hand-padded). Ex-works is not your landed cost: freight, duty and your own margin still have to be added before you know what a garment costs delivered. We cover that maths, and the questions worth asking any maker, in the landed cost breakdown.

Ask three makers the same questions. Order one real garment before routing more work to it. The fuller version is in production for tailor shops; for a shop on the road rather than a fixed fitting room, the travelling model runs differently. Questions a page cannot answer go to contact directly.

What a lender wants

If you are borrowing, you need the formal document, and it should be accurate rather than optimistic. Lenders read a great many projections and are unimpressed by hockey sticks. Conservative numbers you can defend, and a clear account of a bad quarter, do more for an application than an ambitious forecast.

I have read plans built only to satisfy a lender, and the good ones and the weak ones read almost the same, because neither was written to be used. Do not write this plan only to get a loan: it will not tell you when your diary is full, and it will not choose between hiring and outsourcing for you.

Keep the two-page version for yourself, and revisit it every quarter. The formal plan describes the business to someone outside it. The short one tells you what to do on Monday.

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The figures that are yours to fill in, your fixed cost, your price per job, your retail price, are left blank on purpose. Rent and what your market will pay differ enough between cities that any number we offered instead would mislead more than it helps. The structure is what transfers. The numbers are yours to own.