Since Skerritt was still in business school when he thought up the idea for Proper Cloth, he had the luxury of spending two months researching his business plan. He used his “I’m just a student” status to get potential competitors to open up to him about their numbers and where they sourced their materials. “I called all kinds of suppliers and found out who was the best. Then, I ended up working with some of those people when I launched,” he says.
Skerritt was also able to identify the weaknesses in the market. One glaring problem for customers was getting the right fit when ordering online. Skerritt decided to tackle that issue by developing a proprietary algorithm to help customers determine their sizes by responding to a series of questions about body type, among other things.
Today, Proper Cloth’s revenues are about $500,000, but its run rate by year end will be close to $1 mm. The company has been growing rapidly and its margins are a healthy 30 percent to 50 percent. With just three employees and no debt to speak of, Proper Cloth is at a turning point in its development. Will it stay or will it grow?
