Fashion Designer Fashion Business & Brand Management

Question 1

What is 'wholesale' and 'retail' in the fashion supply chain?

Accepted Answer

Wholesale is the sale of goods in large quantities to retailers or resellers at lower per-unit prices; retail is the sale of individual units directly to end consumers at marked-up prices

Answer

In the fashion supply chain, brands sell at wholesale prices to retailers (department stores, boutiques) who then sell to consumers at higher retail prices. The difference between wholesale and retail price is the retailer's margin.

Question 2

What does 'vertical integration' mean in the fashion industry context?

Accepted Answer

When a company controls multiple stages of its supply chain: design, manufacturing, distribution, and retail, rather than outsourcing each stage to separate companies

Answer

Vertical integration in fashion means owning and controlling multiple stages of the value chain. Zara's parent company Inditex controls design, manufacturing (partially), logistics, and retail, enabling extremely fast response to trends: a key competitive advantage.

Question 3

What is a 'line sheet' in fashion wholesale and what information does it contain?

Accepted Answer

A sales document showing all styles in a collection with style numbers, descriptions, available colors, size ranges, wholesale prices, and minimum order quantities

Answer

A line sheet is the primary wholesale selling document, presenting each style with a photo or flat sketch, style number, color/size options, wholesale price, and minimum order quantities, used by sales representatives to take orders from retail buyers.

Question 4

What is 'intellectual property' (IP) in fashion design and which forms of IP protection are most commonly used?

Accepted Answer

IP in fashion includes trademarks (brand names, logos), trade dress (distinctive design elements), copyright (original prints and artwork), and patents (functional design innovations)

Answer

Fashion IP includes: trademarks (protecting brand names and logos), trade dress (protecting distinctive product appearances), copyright (protecting original artistic elements like prints), and utility/design patents (protecting functional and ornamental innovations).

Question 5

What is the difference between 'licensing' and 'franchising' in luxury fashion brand expansion?

Accepted Answer

Licensing grants a third party rights to produce and sell products under a brand name in exchange for royalties; franchising grants operational rights to run a business under a brand's model and brand standards in exchange for fees and a percentage of revenue

Answer

Licensing involves granting manufacturers or distributors rights to use a brand name on specific product categories (perfume, sunglasses) for royalty payments. Franchising grants rights to operate retail stores under the brand's system.

Fashion Designer Practice Test

Fashion Designer Practice Test

Fashion Designer Fashion Business & Brand Management