Being trendy can cost

Fashions come and go in a matter of months, sometimes years, but mostly shorter.

Gearing up to deliver goods and services to match a trend costs money, and you are always taking risks that it might not work out.

Let’s look at the example of retail products.

First you have to identify the trend. If it is coming from an overseas market then if you watch that market you might have advanced warning – but you are still taking a bet that it will come to your shores.

Second – you need to identify suppliers – this can take a while, and because others are looking at the same trend you can have a period of negotiation. This is a case of first in best dressed.

Third – there is a lead time for manufacture and delivery, don’t forget clearance with customs too. The goods need to meet your country’s standards to be saleable in the first place.

Fourth – you need to market and get the goods out in time to be sold.

A few companies do this well – for example Zara out of Spain which can release a new line of clothes into stores in almost no time. They compete well against cheaper Asian clothing because they are more timely. However, it has taken many years and a large economies of scale for this to work out for them.

For everyone else, my advice would be to limit the risk you are taking always selling the latest and greatest. 

Remember that the trick is to sell people what they want and not what you think they want – this can take a lifetime to learn and you will make mistakes.

If you decided to follow the trends and it doesn’t work out too well, at best you will fill your storage space and your garage at home with unsold inventory (my wife often reminds me of the value of unsold goods I am storing) and at worst you will have interesting cash flow problems.