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Handbag Manufacturing Business Plan [Sample Template]

Are you about starting a handbag manufacturing company? If YES, here is a complete sample handbag manufacturing business plan template & FREE feasibility report.

A Handbag Manufacturing business is a wonderful business to start even from the comforts of your room. It can also be started and managed on a part-time basis, and there are also almost no operating overheads to eat into monthly profits. Do not get carried away as this industry is very competitive.

But creating unique designs and making use of uncommon materials can be your competitive advantage and you can sell your products wholesale to fashion retailers or placed on consignment in local retail shops. You can also sell them directly to consumers by displaying the products at fashion or craft shows and selling them online.

The growing competition in the fashion industry has brought about innovations; this in turn has highlighted the swag handbags bring to the wardrobe of both men and women. Meanwhile the fashion and luxury market has a direct impact on the different designs that trend in the handbag industry, as one complements the other.

Starting this business would indeed provide you with the opportunity to make money from doing what you love. This business is ideal for anyone who enjoys creating fashion and helping people achieve their fashion dreams.

But note that your customers will differ based on the style of your bags. They may be for young hip teens and women in their early 20s, or they may be for career women in their 30s and 40s. You could also make large baby bags for mothers or tote bags for beach-goers.

A Sample Handbag Manufacturing Business Plan Template

1. Industry Overview

Reports have it that the united states handbags and accessories market has continued to enjoy uninterrupted growth, but the current slowing growth rate is a concerning threat. Competition is strong in the handbag industry, with a number of big apparel players operating in this segment.

One of the main factors attributed to slowing growth in this industry is the unstable shift in consumer preference from larger bags to smaller ones, which are sold at lower prices.

Another thing affecting this industry is the growing interest of shoppers who prefer to spend more on entertainment and on other services, instead of goods like clothing and accessories. Then when consumers finally decide to spend on bags and accessories, they tend to shy away from big brands, and moving towards more distinctive ones.

Handbags are unique bags carried on the shoulder or in hand, and these products are often designed to accommodate a large amount of contents. Stats have it that the four most popular handbag styles, in terms of the number of internet search queries, are totes, clutches, saddlebags and satchels.

This segment’s share of industry revenue has expanded over the past five years as demand for luxury handbags has grown in most regions of the globe, including strong demand from developing nations like China and india.

The global exchange brought the world market for handbags to $101 billion. The U.S. market for handbags, luggage, and accessories climbed to $9.6 billion, up 3.3% annually from the five years to 2014. The industry is expected to reach $11.8 billion by 2019, growing 4.3% year-over-year.

Also note that a strong growth for men’s handbag has been projected to boost industry sales. It is believed that male gender norms are softening, allowing American men to follow their European counterparts and carry bags without fear of being mocked.

This increased acceptance has allowed the men’s bag market to explode, with male bag purchases increasing to 26% in the last year.

2. Executive Summary

Yolture Inc. is a new embroidery fashion line in Detroit that manufactures handbags, clothing and other embroidery materials targeted at males and females between the ages of 18 and 45. Our business will not only develop a unique fashion line, but also to support it extensively with advertising and promotion campaigns.

We plan to solidify our partnership with retailers by establishing brand awareness and creating a massive corporate identity in the fashion and luxury industry.

Our plan is to market our line as an alternative to existing fashion lines, and differentiate ourselves through our diverse marketing strategies, exclusiveness, and high brand awareness. We plan to build a fashion line that is classy, innovative, upscale, versatile, and expensive.

We have created a diverse promotional plan that includes a range of marketing communications. Yolture Inc. was formed as a Michigan C-Corporation with principal offices located in Detroit. Note that all our business operations, from administration to marketing strategies, take place at this office location of approximately 487 square feet.

Our business strategy at Yolture Inc. is to aggressively develop and market a full range collection to our target audience. We hope to market our fashion line as an alternative to existing clothing lines and set ourselves apart through our unique marketing strategies, exclusiveness, and brand awareness.

We plan to establish core portfolio of products and overcome any industry challenge by using our company’s expertise in the fashion industry. Our business goal in the coming year is to create an indelible impact in the fashion industry and establish a huge consumer demand for the product.

We have also established an alliance with Pop Lane Entertainment, an entertainment company in Detroit with over 65 artists.

We believe that this alliance is very valuable to us at Yolture Inc. because it provides us with the needed exposure and helps us to associate with celebrities. Celebrities are valuable assets because they receive free bags for interviews, concerts, and music videos.

3. Our Products and Services

We at Yolture Inc. will offer our clients assorted handbags and many other embroidery services. Our inventories will include shirts, sweatshirts, jackets, hats, sports apparel, and other clothing items with our key suppliers being Denim, Angelo Litrico and Concord collections.

We plan to enhance these items through custom embroidery, silk-screening, monogramming, and lettering. We can also design an insignia or logo and customize the chosen apparel with our standard stitching and silk-screening equipment for large or small orders from individuals, groups, teams and businesses.

Our services will be priced at the high end to reflect the quality and exclusiveness associated with the brand. We at Yolture Inc. plan to make use of high-end materials such as cashmere, a wool blend, and high gauge denim. We believe that when a markup is placed on our products, customers are willing to pay the premium because of the value and quality guarantee that comes with them.

4. Our Mission and Vision Statement

  • Our vision at Yolture Inc. is to build a massive fashion line that will provide unique handbags, custom printing, and embroidery services to the general public.
  • Our mission at Yolture Inc. is to provide an alternative choice for consumers, based on style and quality.

Our Business Structure

Yolture Inc. is 50% owned by Martha Lina and 50% owned by Thomas Queens. It’s very important to state that Martha Lina is the most active and hands-on of the two owners. Martha Lina comes from a retail management background with enough experience in the fashion industry; especially embroidery, silk-screening, and promotional products.

Our management philosophy at Yolture is based on responsibility and mutual respect. We plan to establish an environment and structure that encourages productivity and respect for customers and fellow employees.

We also plan to hire workers that are very qualified, truthful, customer centric, good communication skills and are open to help us build a business that can compete in the industry. We plan to employ qualified and competent hands to occupy the following offices;

  • Chief Executive Officer
  • Managing Director
  • Admin and HR manager
  • Fashion designers
  • Marketing and Sales Manager
  • Information director
  • Company accountants
  • Sales representatives
  • Deliverers
  • Cleaners
  • Security guard

5. Job Roles and Responsibilities

Chief Executive Officer

  • She will be tasked with providing work direction for the business
  • Charged with building, communicating, and implementing the vision, mission, and direction of the business – which also includes leading the achievement and implementation of the all the business strategy.
  • Responsible for fixing prices and signing business deals for the business
  • In charge of employment
  • Tasked with paying workers salary
  • Responsible for Signing checks and documents for and on behalf of the business
  • Evaluates the success of the organization

Managing Director

  • In charge for managing the daily activities in the company
  • Make sure that the facility is in very good shape and conducive enough for employees
  • Connects with third – party providers (vendors)
  • Tasked with supervising and training new staff members
  • Any other duty as assigned by the CEO

Admin and HR manager

  • Tasked with overseeing the running of HR and administrative tasks for the company
  • Monitor office supplies by checking stocks; placing and expediting orders; evaluating new products.
  • Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
  • State job positions for recruitment and managing interviewing process
  • Organize induction for new team members
  • Tasked with training, evaluation and assessment of employees
  • Tasked with arranging travel, meetings and appointments
  • Oversee the smooth running of the daily office activities.

Fashion Designers

  • Tasked with working through the design process from research sketches and ideas to resolved designs for specific techniques;
  • Use hand and machine techniques to produce samples and finished works;
  • Use a variety of traditional and contemporary materials to interpret designs;
  • Planning the layout of specific designs

Marketing and Sales Manager

  • Oversee external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
  • Creates demographic information and analyze the volumes of transactional data generated by customer purchases
  • Understand, prioritizes, and reaches out to new partners, and business opportunities et al
  • Understand development opportunities; follows up on development leads and contacts
  • Keep all customer contact and information
  • Represents the company in strategic meetings
  • Aid to increase sales and growth for the business

Information director

  • Tasked with the organization’s website
  • Takes care of the ecommerce aspect of the business
  • In charge for installing and maintenance of computer software and hardware for the organization
  • Take care of the logistics and supply chain software, Web servers, e-commerce software and POS (point of sale) systems
  • Takes care of the organization’s CCTV
  • Handles any other technological and IT related duties.

Company accountant

  • Tasked with preparing financial reports, budgets, and financial statements for the company
  • Gives the managements with financial analyses, development budgets, and accounting reports
  • Tasked with financial forecasting and risks analysis.
  • Understand cash management, general ledger accounting, and financial reporting
  • Tasked with developing and managing financial systems and policies
  • Tasked with administering payrolls
  • Ensuring compliance with taxation legislation
  • Take care of all financial transactions for the business
  • Serves as internal auditor for the organization

Sales Representatives

  • Quickly attends to customers in a friendly and professional manner
  • Explain all available services to customers
  • Takes care of any other duty as assigned by the Chief Operating officer/managing director


  • Delivers customer’s orders on time
  • Delivers correspondence for the facility
  • Runs errand for the business
  • Any other duty as assigned by the facility manager


  • Tasked with cleaning the restaurant facility at all times
  • Make sure the toiletries and supplies don’t run out of stock
  • Handles any other duty as assigned by the manager.

Security guard

  • Tasked with protecting the agency and its environs
  • Controls traffic and organize parking
  • Give security tips when necessary
  • Patrols around the building on a 24 hours basis
  • Presents security reports weekly

6. SWOT Analysis

Agreeably, the fashion industry is mature and slow growing, but in it exists a dynamic and competitive environment. That is to why to improve profitability, a lot of companies are restructuring to create leaner organizations and adopt new innovative technologies.

Report has it that consolidation has been prevalent in this industry in the past few years, as larger companies gain leverage in market position and cost cutting. Most companies in this business operate as retailers or manufacturers (wholesalers) or both.

We have analysed our business and we have ensured that we are prepared for anything. We employed the services of a renowned Consulting firm to aid with our SWOT Analysis. Outlined below are the results presented to us at Yolture Inc.


  • Our Business location is unique and growing
  • Yolture Inc. has no local competition within a 45-minute radius
  • We have created an impeccable customer service tradition
  • All our vendors have reputation for high quality products and custom workmanship
  • We plan to take smaller jobs some of our competitors will not accept


  • The industry has slowed down financially over the past three years with the economic downturn
  • Our prototype website may not have the ability and sophistication to compete with other competitor websites
  • Cash flow for publicity is impaired
  • Business hours are limited for a retail establishment (Monday through Friday 9:00 a.m. to 6:00 p.m.)


In our business location at Detroit, the population of young professionals, artists, and other celebrities is growing and retail is expanding. This dynamic is luring new residents, and former residents returning from other cities, to the city’s Downtown.

Also note that the desire to be closer to the urban scene has also attracted some young professionals to inner ring suburbs such as Ferndale and Royal Oak, Michigan. This is a huge opportunity for us at Yolture Inc.


  • Prolonged economic downturn that affects the rebound of area businesses and limits discretionary income
  • Industry wide technological advances that could render existing store equipment obsolete
  • A new competitor opening in the immediate area


  • Market Trend

In recent years, major companies in fashion design and production have all showed huge interests in dated prints that include beautiful embroidered details- both large and small. Also personalization is beginning to gain momentum in the industry.

Personalization gives clients the chance to add a touch of originality and personality to ordinary items and now customers can do this without leaving their houses. The industry has just welcomed new personalization based software like Wilcom’s Kiosk, or online web personalization like Wilcom’s web API.

It simply means that everyone can decide to personalize their fabrics at home. Experts do not expect the economy and consumer spending to sustain growth forever, it is expected that the overall fashion industry will continue to post-modest gains.

Among cloth makers, it is expected that the best performances will come from companies with strong brand recognition. Also as more and more companies have adopted casual attire in the workplace, the trend toward casual dressing will continue.

This has sustained the need for men and women to establish new wardrobes which includes bags and purses.vReport has it that this has had more effect in the men’s segment, as evidenced by the higher growth rate in sales of that segment in the past year.

According to industry experts, branded clothing companies that sell to the department store channel of distribution will grow somewhat faster than the overall industry. In addition to favourable demographic trends, this segment is benefiting from its strength in design and marketing, which has led to a high consumer awareness of and demand for branded clothing.

8. Our Target Market

We at Yolture Inc. plan to target males and females between the ages of 18 and 45 with a combined household income of more than $38,000. Note that within this group, there are no colour barriers. We believe that our customer at Yolture Inc. is a versatile individual who can fit into any environment and is willing to pay a high price for quality products.

Our target market at Yolture is seen as having enough disposable income to spend on high priced quality clothing. We believe that as growth slows in the mature U.S. Fashion markets, companies are increasingly looking overseas for growth opportunities.

American brands translate well internationally, and many expanding economies overseas are interested in buying U.S. products. International business has therefore become a focus of some U.S. companies. We have considered that option and are inclined to soar high as we expand.

Our Competitive Advantage

In a market where prospective clients are barraged by advertising and marketing campaigns delivering an onslaught of lifestyle and fashion messages, a corporate identity is a powerful weapon. Note that having a brand is becoming an increasingly important factor in the fashion industry.

A lot of consumers have less time to shop and are spending their disposable income more carefully. Well-known brand names, with their quality image, make the shopping experience easier and faster for many consumers.

For manufacturers, brands build consumer loyalty, which translates into repeat business. Our business name is not attached to any particular group of customers and it allows entry into different segments of the industry. Also another advantage we possess at Yolture Inc. is our extensive marketing strategies.

We believe that that through the use of celebrities, advertising, promotion and giveaways, we can be able to develop its presence in the market.


  •  Sources of Income

We at Yolture Inc. will make profits from providing our clients with assorted handbags and many other embroidery services. Our inventories will include shirts, sweatshirts, jackets, hats, sports apparel, and other clothing items. We will also generate income by providing graphic design services to customers that are in need of logos or designs.

We believe that these designs and logos can be purchased as a stand-alone service or for embroidering onto apparel and promotional products. We will also make money from selling embroidered apparel and promotional products to customers. We believe our business will be able to generate margins of 50% on each dollar of sales.

10. Sales Forecast

The United States fashion industries are experiencing intense competition and pricing pressures, while facing the need for constant product innovation.

Also note that these industries are enjoying a great economic cycle, with low interest rates, low unemployment, strong consumer confidence, and a low savings rate. Consumers are continuing to spend at a healthy clip. We at Yolture Inc. believe that maker’s with strong brand recognition and those that are closely in tune with consumers’ needs will enjoy average growth.

We have established plans to provide our clients with impeccable products and services and we make our assumptions after undertaking extensive research and in good faith. Below are the sales assumptions for Yolture Inc.;

  • We project a sales increase of 37% in 2019 due to the addition of a commissioned outside sales representative in July 2019
  • We expect a sales increase an additional 30% in 2023 due to the continued effect of adding a commissioned outside sales representative in 2019
  • We also forecast a sales increase an additional 15.0% in 2023 due to the continued effect of adding a commissioned outside sales representative in 2019
  • The relationship of apparel sales to total sales continues at its present level of 47%
  • We expect the cost of apparel continues at its present level of 32% of apparel sales
  • We forecast relationship of customization sales to total sales continues at its present level of 35%
  • We estimate the cost of customization continues at its present level of 42.5% of customization sales
  • We project that the total gross margin remains constant at its three-year average of 52.5%
  • Marketing Strategy and Sales Strategy

We at Yolture Inc. plan to create a sales team that will be charged with generating sales leads on a regional and national basis. These individuals will also be responsible for establishing connections with retail outlets. We plan to make our distribution channels a key part of our business success.

We were able to find out that our target audience buys clothing and footwear from a variety of retail outlets. Differences exist in the distribution mix for men’s, women’s, and children’s items. For instance, more women’s fashion items are purchased in specialty and department stores than is the case for men’s fashion.

Men’s items are more prevalent in discount stores and general merchandise chains. In the children’s segment, a considerably higher portion of items are purchased in discount stores. We at Yolture Inc. have analyzed these and have made plans to satisfy our diverse customer base.

Catalogues are another important method of distribution. Most customers will have less time to shop, and for some, catalogue shopping offers a more convenient and pleasant alternative. Another distribution channel we at Yolture Inc. plan to use is the Internet.

Customers prefer the convenience of being able to shop from anywhere and at any time they wish. Manufacturers with Internet sites use them for marketing and informational purposes. With expected technological advances in hardware, software, and data pipelines in the future, shopping for fashion items online will keep growing.

11. Publicity and Advertising Strategy

Our plan at Yolture Inc. is not only to develop a unique fashion line but to support it with advertising and promotion campaigns. Just like we stated above, we plan to strengthen our partnership with retailers by developing brand awareness.

We hope to build Yolture into a fashion line known to be classy, innovative, versatile, and expensive fashion items. Our promotional plan at Yolture Inc. is diverse and includes a range of marketing communications:

  • Public relations: We plan to issue press releases to both technical trade journals and major business publications such as Playboy Magazine.
  • Trade shows: Our sales representatives will attend and participate in several trade shows such as Kinky in New Orleans.
  • Print advertising: Our print advertising program at Yolture Inc. includes advertisements in magazines such as Flop, and Fashion Pages.
  • Internet: We plan to establish a presence on the Internet by developing a website. Plans are underway to create a professional and effective site that will be interactive and from which sales will be generated worldwide.
  • Other: We also plan to leverage other channels including billboards, radio and television commercials, and a street team.

12. Our Pricing Strategy

Agreeably, we at Yolture Inc. have no local competition but we understand that we must compete with internet retailers who offer similar products and services at slightly lower prices. But we believe that our target audience will buy based on superior quality and product wear, excellent customer service, and local business location.

We also know that businesses in our business scope make their money from the interest and commissions they offer their services and products. We hope to keep our prices at the average market rate for the meantime, but will increase as our identity in the market increases.

  • Payment Options

Our plan at Yolture Inc. is to create payment methods that will suit our diverse clients. We have also partnered with a renowned banking platform to help serve our clients very well and comfortably. We hope to make available the following payment options for our clients;

  • Payment by via bank transfer
  • Payment via online bank transfer
  • Payment through POS
  • Payment through PayPal
  • Payment via check
  • Payment via bank draft
  • Payment with cash

13. Startup Expenditure (Budget)

Our Business strategy at Yolture Inc. is to aggressively develop and market a full range collection to consumers. We plan to market our fashion line as an alternative to existing fashion lines and differentiate our business using our marketing strategies, exclusiveness, and brand awareness.

We also plan to build on our core portfolio of products and overcome any obstacles by using our expertise in the clothing industry. The financial projection and costing of Yolture Inc. is outlined as follows;

  • Cost of incorporating the Business – $750.
  • Cost for basic insurance policy covers, permits and business license – $10,000
  • The cost of acquiring a suitable Office facility in a business district 6 months (Re – Construction of the facility inclusive) – $55,000
  • The budget for equipping the office (computers, software applications, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al) – $5,000
  • The price of purchasing of the required software applications (CRM software, Accounting and Bookkeeping software and Payroll software et al) – $12, 000
  • The Cost of Launching our official Website – $600
  • Our budget for paying at least three employees for 6 months plus utility bills – $36,000
  • Additional Expenditure (Business cards, Signage, Adverts and Promotions et al) – $2,500
  • Our Inventory fund – $2,000,000
  • Miscellaneous: $1,000

From our cost analysis above, we will need $122,850 and our $2million inventory fund to start Yolture Inc.

Generating Funding/Startup Capital for Yolture Inc.

Yolture Inc. is 50% owned by Martha Lina and 50% owned by Thomas Queens. It’s very important to state that Martha Lina is the most active and hands-on of the two owners.  Martha Lina comes from a retail management background with enough experience in the fashion industry; especially embroidery, silk-screening, and promotional products.

Our two founding owners will prefer to fund the business privately for now, but are likely to source for external funds as the business grows. The company will also seek a substantial long-term business loan for the purpose of developing the fashion line.

This funding will cover operating expenses and product development leading to the launch in July 2019. Our Management have been able to raise $1million from the two founding partners ($500,000 each). They have been able to raise this amount through their individual savings and few soft loans from their families.

14. Sustainability and Expansion Strategy

We at Yolture Inc. plan to use a direct sales force, retailers, and the Internet to reach our target markets. We believe that these channels are most appropriate because of time to market, reduced capital requirements, and fast access to established distribution channels.

We also plan to use a consolidated warehouse before acquiring a warehouse of our own. Note that as companies in these mature industries continually look for ways to compete effectively, U.S. Fashion wears manufacturers have increasingly moved their production facilities to lower-cost locations outside of the United States.

Even though some manufacturers have moved their operations completely offshore, others are keeping together a few production facilities in the United States to manufacture products requiring a quick turnaround time.

Although manufacturing in Asia remains substantial, the growth of clothing manufacturing in Mexico and the Caribbean has been significant due to the North American Free Trade Agreement (NAFTA) and the lowering of tariffs. Items assembled in Mexico and the Caribbean nations from fabric formed and cut in the United States accounted for 39% of all apparel imports in 2015, up from 27% in 2013.

We understand that with an improved economic outlook, Asian currencies have strengthened against the U.S. dollar over the past year. Though this has benefited U.S. exports somewhat, it has put pricing pressures on imported Asian goods.

For the vast amount of goods manufactured in China, however, no such benefit is currently expected, as this country’s currency has remained fixed in value versus the U.S. dollar.


  • Business Name Availability Check: Completed
  • Business Incorporation: Completed
  • Opening of Corporate Bank Accounts: Completed
  • Opening Online Payment Platforms: Completed
  • Application and Obtaining Tax Payer’s ID: In Progress
  • Application for business license and permit: Completed
  • Purchase of Insurance for the Business: Completed
  • Conducting feasibility studies: Completed
  • Leasing, renovating and equipping our facility: Completed
  • Generating part of the startup capital from the founder: Completed
  • Applications for Loan from our Bankers: In Progress
  • Writing of Business Plan: Completed
  • Drafting of Employee’s Handbook: Completed
  • Drafting of Contract Documents: In Progress
  • Design of The Company’s Logo: Completed
  • Printing of Promotional Materials: Completed
  • Recruitment of employees: In Progress
  • Purchase of software applications, furniture, office equipment, electronic appliances and facility facelift: In progress
  • Creating Official Website for the Company: In Progress
  • Creating Awareness for the business (Business PR): In Progress
  • Health and Safety and Fire Safety Arrangement: In Progress
  • Establishing business relationship with banks, financial lending institutions, vendors and key players in the industry: In Progress