How I Started A $24K/Month Ethical Fashion Marketplace
Hello! Who are you and what business did you start?
My name is Lorena and I am originally from Barcelona. After 3 years living in Australia, I started Velvety. I saw a gap in the industry and I wanted to introduce the concept of ethical fashion to the largest amount of Australian people as possible.
Velvety is the perfect destination for eco-conscious consumers looking for vegan, ethically made, and sustainable products and fashion, but also a good place to start a journey for those who are interested in learning about sustainability and moving away from the fast fashion industry.
I am trying to solve a very large issue. The fast fashion issue, but also the cruelty behind the leather and animal-related injustices, by offering a sustainable and vegan alternative, so the reason why I started Velvety is simple, I wanted this issue to be addressed and transformed.
My main goal has always been to show customers that there is a better way to shop and contribute to a better world.
What's your backstory and how did you come up with the idea?
I have always loved fashion. In Barcelona, I studied to be an image consultant. I dedicated my last years living in Spain to helping others find their style as a fashion stylist, beauty consultant, and makeup artist, among other opportunities. I run my small salon, where I used to run shows and classes for my customers.
I became a vegetarian when I was 18 years old, and it was just the beginning of the journey…
When I was 24 years old, I meet who nowadays is my partner. An Australian traveler with the most brilliant soul. And as you can imagine, he changed my life forever!
I moved to Australia that same year and I spent a whole year learning English. Still, before I couldn’t even finish and whit very broken English, my entrepreneurial spirit couldn’t stay calm. With just an ABN, I started my small fashion pop-up store importing the fashion brand from a friend in Barcelona.
It was a great adventure and a good way to learn how to start a fashion project in Perth, Australia, but it only lasted a year. After that, we moved to Melbourne and found a casual retail job working for a vegan shoe shop.
At that stage, I was already a vegan and developed a strong connection with that new part of me, so I guess that my love for animals, my interest in sustainability, my experience in the vegan retail area, and my strong sense of duty, helped me to come with the idea of opening an online vegan+ethical+sustainable fashion and lifestyle store.
I was lucky. My partner and I had just moved to the countryside trying to enjoy life slowly, so I had the time and the serenity I needed to start Velvety.
It all started at home, while I was still working for the vegan shoe shop in the city and I taught myself everything by searching for what I needed. So, as you can imagine, I spent days and nights searching for answers, and ways to promote my products and business. I started using my common sense and approached the vegan community first, as it was a quick small success.
Take us through the process of building the first version of your product.
Velvety is a marketplace/online shop, meaning I only sell and promote labels or brands that have been manufactured or designed by others.
I do own Velvety soy candles, which is my label, however, it is a very small investment per year as I am “made to order” and even make/print my labels.
Between insurance and photography, perhaps I spend around USD 500 yearly. Also, approximately 1 year ago, I got Velvety registered as a trading name, so the cost was roughly USD 1700.
Describe the process of launching the business.
After 6 months of effort and a lot to learn, apply and change, my business went from a revenue of USD 4,000 to $10,000+
The launch of Velvety was quite simple! I had no online presence yet, so I decided to do a LIVE launch inviting friends and vegan people I knew in the area where I used to live and leased the hall of town for this purpose.
I got many sales that day, and all loved my concept business idea, so word of mouth was a very important step. That same day and for the whole first week, I remember getting sales from friends and friends of friends.
Creating the website was the most fun part, and still is for me! However, it took time and effort, lots of mistakes, and lots of research, and again, during the first year, I tried to be present at many vegan markets as possible, so I could meet customers in person, talk about my business and give them a business card.
The biggest lesson I learned from the starting process is that spending money to make money is necessary, not only on marketing or Google/Facebook ads but also on learning from other professionals all the time.
Since launch, what has worked to attract and retain customers?
2 years after I launched Velvety, I had a baby, and personally, it was a difficult journey, as my son was born with heart complications and I also had to spend a whole month in hospital before he was born.
For the whole first year, I was very busy trying to be the best mum and the best business owner. However, it seemed impossible and exhausting. So, one day, I received a marketing email (I subscribed to her newsletter a long time ago), but at that time, I felt that it was a destiny call.
I decided to be part of her mastermind program and start learning from one the best e-commerce couches in Australia, so I made a financial effort and I jumped into her 6 months of training. That is when the hobby started to look more like a real business…
After 6 months of effort and a lot to learn, apply and change, my business went from a revenue of USD 4,000 to $10,000 USD+. It was the beginning of something very special. I learned to master Facebook Ads and it changed the whole game, as sales started to flow almost magically.
However, during the past 2 years, I hired an SEO agency to do my Google ads and SEO, while I still manage my Facebook Ads and Pinterest Ads.
Social media was and still is a very important part of the game, especially Instagram for me. You have to be consistent and creative and perhaps hire someone for some time if you cannot spend time on this, as I did.
For retaining customers, I use Klaviyo rewards, a simple system to reward customers with points and discounts, but I also use SMS and Newsletter strategies.
How are you doing today and what does the future look like?
Currently, Velvety is a profitable business, however, expenses and cost of goods are high and ethical “wholesale prices” are much higher than fast fashion prices, so what I make isn’t what I earn and it also changes a lot, depending on how much cash flow I have to spend that year.
On average, I try to make 50% off profit from the products I stock or pre-orders, however, for made-to-order products or products that I do not keep in stock, the profit margin is generally 30% to 20%, however, there is no investment.
When you have a small ethical business going through a recession period like we are all currently experiencing this 2023, it is difficult to have long-term goals, as social trends and the economy itself change so much, long-term plans seem impossible.
However, as a short-term plan, I am planning on starting a small sustainable fashion directory beyond the Velvety online shop, so customers can find more sustainable vegan brands along the journey. There is a whole marketing strategy behind this purpose but the main goal is to give visibility to more and more ethical labels.
Through starting the business, have you learned anything particularly helpful or advantageous?
Totally! The biggest one: you can’t do it all!! You can try, but you can’t keep going forever.
I love SEO, I do! And I tried to teach myself for years and apply as much as I could for the first 3 years, but I reached a point where I had to give that up to an agency, so I tried and tested a few until I found the one that is working for me. So, they help with blogging, backlinks, competitors' research, and page optimizations.
Another big decision I had to make some time ago was “testing” the dropshipping and pre-order/made-to-order system with some of my brands. As a small business with no extra cash to spend, I had to try this new venue…but the result was and still is a success!
Currently, I have a mix of labels. I stock 60% of them, but the rest are made-to-order or shipped directly from the label, so I do not have to put the money in front.
What platform/tools do you use for your business?
I started Velvety using Squarespace, but after 3 years, I realized I had to swap to Shopify, and I am so glad I did it! I currently use these very important apps for my business:
For organizing myself, I use ASANA.
What have been the most influential books, podcasts, or other resources?
As I previously mentioned, the training with Sarah Quinney
I also love learning about SEO with Neil Patel
A movie: The True Cost
I was a vegan when I started Velvety, but not an ethical shopper, so after a lot of research and watching the true cost movie I realized that injustice is everywhere, so I couldn’t create a vegan shop with fast fashion/unethical products, it had to be truly vegan, ethical and sustainable.
Advice for other entrepreneurs who want to get started or are just starting out?
If you have an entrepreneurial soul, you must try what is to be an entrepreneur! However, I have seen many people starting businesses with the only goal to make money and while it can work for a minority, I believe the only businesses that keep growing are the ones that are driven by passion and morals.
Follow your heart and use your brain only to keep going with the learning process, the business duties, and the admin work.
Also, allow yourself to be lazy, have days where you do not feel like working, and give yourself a break. A business isn’t an 8h day's work, you have to be consistent, especially at the beginning but, remember that you come first, and if you aren’t ok, the business isn’t going to be ok.
Give yourself reasons to continue doing what you started and never forget WHY you started it.
Where can we go to learn more?
If you have any questions or comments, drop a comment below!
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