Clothes Mentor

Clothes Mentor serves consumers seeking upscale, gently used women’s fashion at accessible prices. The concept traces back to Lynn and Dennis Blum, who launched Once Upon A Child in 1985 to meet demand for affordable children’s clothing. Ronald G. Olson, president of Grow Biz International, later acquired that venture. Clothes Mentor was founded in 2001 and began franchising in 2006 or 2007. NTY Franchise Company acquired the franchise rights in December 2006. Ron Olson is identified as the brand’s CEO. NTY Franchise Company is headquartered in Minnetonka, Minnesota, and Clothes Mentor is headquartered in Plymouth, Minnesota. Recent data lists 51 total franchised units, all franchisee owned, across the United States. The brand has been recognized as one of the “Fastest Growing Franchises” and included in Entrepreneur Magazine’s “Franchise 500.”

The secondhand clothing market is growing as shoppers respond to sustainability concerns, fashion’s environmental impact, inflation and the need for value. Clothes Mentor offers branded fashion at lower prices through an upscale resale model. Traditional specialty retailers commonly report margins of 30% to 35%. The resale sector includes independent boutiques and online platforms, while Clothes Mentor operates as a U.S. franchise in the structured, brick and mortar upscale segment. Its margins can give franchisees more room to spend on staffing and store management.

The initial franchise fee is $25,000. Clothes Mentor offers veterans a rebate of either $2,500 or $5,000 on that fee. The total initial investment is estimated at $305,000 to $428,500. Other reported ranges are $272,000 to $396,000 and, in a 2017 reference, $219,000 to $344,000. Average investments in the clothing and fashion sector typically range from $188,172 to $368,063. Estimated costs include $25,000 to $60,000 for leasehold improvements, $5,000 to $9,000 for signs, $50,000 to $70,000 for fixtures and supplies, $19,000 for proprietary software and the POS system, and $50,000 to $70,000 for initial inventory. Deposits, licenses and permits range from $7,000 to $15,000. Legal and accounting fees can reach $4,000, security costs range from $7,000 to $10,000, training travel from $4,000 to $8,500, and pre opening labor from $10,000 to $15,000. Grand opening advertising is estimated at $16,000 to $20,000, while miscellaneous pre opening expenses range from $14,000 to $20,000. Three months of initial rent and additional funds for the first three months of operations each require $20,000 to $25,000. Prospective franchisees should have $90,000 in liquid capital, although some sources cite $150,000 or more, and a net worth of $400,000. The advertising or national brand fund fee is stated as $2,000 per year and may increase to a maximum of $3,000 annually with notice. One source states the fee as 5% plus $2,000 per year. NTY Franchise Company maintains relationships with third party lending institutions to assist franchisees with startup financing. PeerSense introduces franchise buyers to SBA and conventional lenders but is not a lender.

Clothes Mentor uses a cash paid at purchase model to obtain inventory directly from customers. Franchisees manage buying, merchandising, sales and customer service as women’s fashion inventory changes. Margins of about 60% can support adequate staffing and experienced store managers. The brand offers one traditional retail store format rather than multiple format options. Training includes three modules with pre opening and post opening classes, 31 hours of classroom instruction and 18 to 20.5 hours of hands on training. Topics include business planning, fiscal management, real estate selection, store operations, merchandising, inventory management and the proprietary point of sale system. A full week of in store training focuses on buying the right product, and printed materials are provided. Support from the Plymouth, Minnesota headquarters covers computer, operations, marketing and financial matters. Franchise Business Consultants visit each store at least once a year. Franchisees also receive help with lease negotiation and site selection, grand opening support, a toll free support line, security and safety guidance, and field operations assistance through the proprietary software platform. The cloud based POS system tracks inventory, staff performance and cash flow and allows owners to run reports remotely. More than 30% of existing owners have opened additional stores.

Traditional specialty retailers commonly report 30% to 35%. The margin structure can help franchisees cover staffing and store manager costs. Recognition as one of the “Fastest Growing Franchises,” inclusion in Entrepreneur Magazine’s “Franchise 500,” and the number of multi unit owners provide additional qualitative indicators of the system’s performance.

Historical reports from 2017 listed 146 locations across 30 states after 10 years, and plans in 2018 called for more than 200 stores within the following five years. Current franchise data lists 51 total franchised units, all franchisee owned. NTY Franchise Company acquired the franchise rights in December 2006. Its proprietary cloud based POS system manages inventory, staff performance and cash flow, with remote reporting. More than 30% of owners have expanded to multiple units. The brand is identifying opportunities in Southeast and Western states, where it has limited presence but sees suitable demographics for its target market.

A prospective franchisee should be prepared to manage a substantial retail operation and meet the stated requirements of $90,000 in liquid capital and $400,000 in net worth. Specific industry experience is not stated as a prerequisite, while the training program addresses the operating system. An interest in fashion trends or a willingness to master inventory selection may help because buying the right product is central to the model. The system encourages multi unit ownership, and more than 30% of current owners have opened additional stores. Clothes Mentor has historically operated in more than 30 states and identifies expansion opportunities in the Southeast and Western states. Training includes pre opening classes and a full week of in store instruction. The franchise agreement term is described as a defined period with provisions for renewal and transfer if an owner sells the business.

The system also provides training, ongoing support, a proprietary POS system and field consultant visits. PeerSense provides franchise research that includes SBA lending history, Loan Activity Score, location maps with Google ratings, FDD financial data and side by side comparison tools. PeerSense helps franchise buyers evaluate financing options by making introductions to SBA and conventional lenders, without lending or approving loans.