Tumblertown

I consider myself a master in baby clothes; turns out that I’m also working on my Masters in Business. Today I’ll take a little of the knowledge from the classroom and apply it to the baby clothing industry. To do this I’ll be applying Michael E. Porter’s classical five forces to the industry and ultimately determine if it a good industry to enter and compete in.

Force #1 Barriers To Entry

There is hardly any capital required to enter the baby clothing market. Almost anyone can find a supplier for baby onesies (or any other type of clothing), put up an Internet shop, and start selling. This is a very bad thing if you want to be profitable in the market for the long haul.

One barrier to entry that does exist is branding. Some baby clothing creators (a la Gerber) have managed to brand their clothing making it so people would choose their brand over other brands. Gerber has gone so far as to trademark the name “onesies”.

Probably the biggest barrier to entry is distribution. Getting into megastores can be nearly impossible for newcomers and driving traffic to your webpage can also be extremely difficult.

Force #2 Suppliers

There are actually quite a few suppliers of the materials that are needed for baby clothing. This makes it so a baby shop owner can drive down prices by making suppliers compete for their business. The cost of switching from one supplier to another is almost non-existent. This information seems to indicate that the suppliers don’t have much power which is a good for the business owner.

Force #3 Buyers

This is a tough one to evaluate. Baby onesies are probably considered commodities. Any time something you’re selling is a commodity, it gives power to the buyers (not good if you are looking to sell your goods for a large profit). If you are charging a high amount, buyers can easily purchase similar goods at a lower price.

Force #4 Substitutes

The only substitute for clothing is wearing nothing. The funny thing is that with babies, wearing nothing is actually a viable option. And wearing nothing is a pretty cheap substitute. Barring all parents allowing their children to run around naked, baby clothing doesn’t seem to have any clear substitutes.

Force #5 Rivalry/Competition

There are literally thousands of shops on the Internet that sell onesies and other baby clothes. Having this kind of intense competition is usually not a good sign when entering into an industry.

Overall, my assessment of the industry indicates that suppliers and substitutes would be positive signals for entering the market. However, the intense rivalry and low barriers to entry will make it very difficult to succeed in a saturated market unless you can somehow position your baby clothes shop so that it can’t be easily replicated. Best of luck selling clothes!

Please feel free to look at some cute girl baby onesies.