Professional Documents
Culture Documents
Rachel Buttery
Jui-Lan Chang
Rui Min
Feasibility Analysis
Table of Contents
Rui Min have agreed to be General Manager and Assistant Manager, respectively.
The three of us together have agreed on these positions based on how much we will
be contributing to the business.
Belle Femme Boutique offers a wide variety of professional clothing for women
(including dresses, pants, blouses, skirts, and blazers) and accessories (such as
purses and jewelry). We also provide our customers with personalized service from
in-store stylists to help the customers find the perfect clothing items that will lead
them to success in the working industry.
Belle Femmes headquarters and main store is located in New York City.
BelleFemmeBoutique.com will be available online for customers around the world to
purchase our products and communicate with our clothing style professionals.
Phone applications are in demand for our target market so we have created a
phone application for our customers to download for free. This phone application
will provide customers with a social outlet where they can post photos of
themselves wearing professional clothing items. In these photos, users (and us)
can tag clothing items and link them to our website where customers can buy the
items directly from the photos.
Personal Analysis
Belle Femme's sole proprietor, Jui-Lan Chang, was the creator of the Belle Femme
product line. Chang has had an interest in fashion and apparel merchandising since
attending college at Iowa State University. She has been included in many clubs,
projects, and activities related to fashion merchandising.
As close classmates through College, Rachel Buttery and Rui Min were asked to join
her in her journey to create her dream company. Buttery and Min were both
involved in French studies at Iowa State University. This educational background
leads them to help Chang with the creation of the brand name, Belle Femme.
Rachel Buttery has the educational background in Hospitality Management to help
with the operations of the stores. Human resources, training, and management are
her strengths in the business. This makes her fit to be the General Manager of the
boutique.
Rui Min is experienced with accounting and customer services. He has almost four
years working experience in Memorial Union Catering. Working as a supervisor he
has gained strengths in communications and services for customers. This makes
him fit to be the Assistant Manager of the boutique.
Market Analysis
Core customers:
Our core customers are women between the ages of 18-30. The women in this
range are both our main customers and our potential customers. We believe that
we can succeed in having women as our target market because of the size and
diversity of the city we plan to open stores in. We did some research for the
population in New York City, where our headquarters is located, through U.S.
Census Government. (U.S. Census Bureau, 2014)
We found that in 2013, the total population in New York City was 1,626,159 with
52.8% being women. This indicates that more than half of the population is women.
This shows that there is a huge market for us to sell our products. Among this huge
population, there are 85.5% of people, who are above 25 years old and already had
high school education or higher (2008-2012). This takes up the majority population
in New York City. People who finished their bachelors degree or higher are taking
up to 58.1% (also above 25 years old), which is above half as well. Because of the
large percentage of women, we believe that we will have a strong power and
opportunity to gain plenty of women who are entering the workforce as potential
customers. (U.S. Census Bureau, 2014)
Market Segmentation
Geographic Segmentation:
Our headquarters for our business is located in New York City, where the biggest
and most diverse demographic population is located. In the future, we may plan to
expand our business throughout the United States, focusing mainly in big cities,
because these places have a diverse demographic and a variety of markets. For
example, handling our brand to other business owners and locating in Chicago,
which will represent Central America, a couple more located in Florida, Los Angeles,
and other east coast cities. We would also like to expand to France and Italy in the
future, which are considered to be couple of the most fashionable countries in the
world.
Demographic Segmentation:
Our segmentation is focused on the women who are 18 to 30 years old. Generally
these women have a high school level of education, and are ready for their college
professional studies, and women who are ready for seeking an internship or fulltime job in college. This also includes women who have already started their
careers or are currently in the workforce.
Psychographic Segmentation:
Most women would like to spend their leisure time with their friends shopping,
trying new things, and dressing up. Our store has equipped professional educated
employees to help these groups of women to make the best decisions and lead
them to purchase the right selections. This means employees must depend on the
information that customers share in order to give them professional advice and
suggestions to best satisfy the customers demands.
Environmental Audit
63.8% of all persons 16 years and older are in the labor force. 59% of women 16
years and older are in the labor force.
The average time all people travel to work in New York is 32 minutes. This shows
that our customer base could be traveling in daily to work in New York which means
they could be spending more time shopping and doing activities in their local work
area. Out of 8,877,453 people, it is safe to say about half of those could be women
traveling to work. This bumps up our expected customers roughly 4,400,000
women who travel into New York on a regular basis (versus women who reside in
New York). 32 minutes in any direction of New York is potentially our market range
for our store. (U.S. Census Bureau, 2014)
In New York, 82.9% of employed persons work in management, business, science,
arts, service, sales, and office occupations. The portion of this percentage would be
roughly 4,800,000 women over 16 who would potentially need to buy our
professional clothing. (U.S. Census Bureau, 2014)
Women are beginning to enter the workforce in larger numbers. They are trying to
break the glass ceiling by receiving higher paying occupations. With the interests in
fashion that women have today throughout their high school and college life is
making it difficult for women to be perceived in a professional and elegant manor.
Belle Femme's goal is to help women break away from this perception of the
stereotypical college girl and be there to support women and help them become the
professional image that corporations and service operations are looking for to be
their managers and owners. This trend directly supports our business efforts and
our sales.
All types of technology trends are growing exponentially in recent years. This is the
reason we have realized that we need to be a part of the mobile market. Students
are constantly looking at their phones while walking, talking, and socializing with
their peers. Students are also shopping online during class. We have witnessed this
through personal experiences throughout college. With college focusing on getting a
good job and internships, we are hoping to be of help to the students and their
search for a career.
Internal Audit for Experience Economy
Four Es and Four Ps information located in a chart on Page 6. (MBASkool, 2014)
Competitive Analysis
SWOT Analysis
Our major competitors are J. Crew, Mango, Banana Republic, and Zara. We are also
competing against other professional clothing retail stores located in both large and
small cities.
SWOT Analysis chart located in a chart on Page 7. (MBASkool, 2014)
E
sc
a
pi
st
E
nt
er
ta
in
m
e
nt
E
st
h
et
ic
Feminine and
empowered photos of
women load the walls of
Belle Femme stores to
show our customers
what we can do for
them.
Our advertisements
provide interesting
and elegant colors,
textures, patterns
and accessories to
draw potential
customer's interest.
The QR barcodes
are entertaining to
students who are
curious and
exploration.
Employees are
encouraged to wear
Belle Femme
clothing during their
shifts to promote
the different styles
to customers while
they shop.
Employees are also
encouraged to wear
Belle Femme
clothing and
accessories outside
of the workplace to
extend brand
examples to
different areas in
which they reside.
We put together
fashion shows on
college campuses to
give students an
opportunity to view
different styles. Belle
Femme
advertisements focus
on sophisticated
styles and
empowered women
stances.
E
d
u
ca
ti
o
n
al
E
d
u
ca
ti
o
n
al
Ma
ng
o
Our advertisements
provide potential
customers with
different style and
outfit ideas. We have
posted QR barcode
scanners and flyers to
provide potential
customers with store
locations, hours,
website, and phone
application
information.
Our advertisements
provide potential
customers with
different style and
outfit ideas. We have
posted QR barcode
scanners and flyers to
provide potential
customers with store
locations, hours,
website, and phone
application
information.
Properties
Product
Presentation
Promotional
Applications
People
Designed and
sourced from
Spain which is
more expensive
than its European
counterparts.
Major revenues
earned by the
brand are from
apparel only.
Controversy over
some designs has
initiated lawsuits
inviting criticism
from the fashion
industry.
Can emerge in
India and Africa,
which are largely
unsaturated,
instill growth and
stability for the
brand. Could
diversify further
into many other
product lines.
Fluctuations in
currency threat
overall sales
revenues. The highly
fragmented fashion
industry means low
brand loyalty and
high bargaining
power for consumers
due to low switching
cost. An emergence
of many new
designers in this
segment.
Za
ra
Ba
na
na
Re
pu
bli
c
J.
Cr
ew
Bel
le
Fe
m
me
A well-established brand
name worldwide. The supply
chain management, most of
their processes like
operations, manufacturing is
extremely low cost. Clothes
are produced at a low cost
with the most innovative and
fashionable designs. They
are a part of one of the
biggest Spanish retailers in
the world.
Economic fluctuations
affect apparel retail
business. Cost of prime
real estate is
competitive. Increasing
awareness and
penetration of
competitive brands.
Venturing into
new specialty
shops for men,
women and kids.
Adding deluxe
shoe and
handbag salons
in existing
stores.
Our lack of
experience in the
market and
business industry
in large cities. It is
logical that many
suppliers would
not like to support
a new business.
Our competitors
currently have more
locations than we do,
which puts us at a
disadvantage for our
market share. Women
are already familiar with
our competitors' brands
and products.
Strengths
Weaknesses
Opportunities
Threats
Marketing Trends
Market/Customer Trends:
Market and Customer trends will go through the employees and customers
communication and feedback. Our boutique strives to know more detailed
information about what the customers really want so we are able to make changes
to accommodate each new generation. Also through our observations and market
research, we will be able to stay up to date on trend changes and make prompt
adaptations.
Related Industry Trends:
Retail Industry trends change depending on the seasons, holidays, and also the
ages and sex of the customers. Customer demands vary at different times. The
most influential trend is the change in seasonal clothing to satisfy customers'
needs. According to the market demand, for example, when the season is early
winter, customers may need a trench coat or a sweater to keep warm or they just
want a scarf to accessorize. At this time, our store will follow the season changes by
switching out some autumn clothing for winter clothing and accessories.
Market Potential
The total demand based on our population research shows that there are more than
half of the percentage of people in New York are women (52.8%). Among these
women, there are 44.5% who are 18 years old and above (U.S. Census Bureau,
2014). This means we have a large group of customers and power spenders.
These women are our main focused customers that we want to walk into our
boutique.
Our competitors have more stores in New York than we will in during the startup of
our business. As our brand grows through our promotional efforts, we will be able
to expand our boutique throughout New York, locating in malls and strips near
residential areas. Although our competitors have advantage in number of
properties, we share some of the same market of young women. With our strong
focus on younger women upcoming into the business and service industry, our
brand has an opportunity to come out on top.
We believe that when our business opens we will have a positive influence in the
womens clothing market on both our clothing lifestyle and our new phone app,
especially for young women. They are very interested in the new upcoming
technology, so our phone app will be the new generation in shopping technology.
They can select their clothing or match the different style at any time and
anywhere. This will shrink the time needed to find and purchase items, leaving
them with more time to scroll through more real-life photos.
Vision
10
Financial Analysis
Start-up costs
Below is a list of our general startup expenses for Belle Femme. Our startup assets
include computers, cash registers, clothing inventory, etc. and also we included
costs incurred while starting our website and mobile phone application. (AESHM
474, Prophecy Software, 2014) (Google, Shopping, 2014)
Startup Costs
Web Site Design
Site Implementation
Five Year Website Domain
Registration
(Five Year Search Engine
Registration
Initial Deposit
Startup Inventory
Insurance
POS Software
$3,000
$0
$95
$10,000
$0
$55,500
$1,100
$300
$6,500
Phone Application
$2,000
Leasehold Improvement
Rent for Month of Improvements
$20,000
$3,000
Marketing
$11,350
Long-Term Assets
$24,599
$137,444
Source of funds
We have chosen only one of the three of us to be the sole Owner of Belle Femme as
to receive the benefits of having a Sole Proprietor. The other two of us will be
named the General and Assistant Manager based on our knowledge and experience
and demand to be a part of the ownership. We will all three be participating in the
startup funding of Belle Femme. This of course comes with signed agreements to
provide the positions necessary for a certain length of time in order to earn back
11
our investments. The sole Owner will be providing the largest investment because
she has the largest amount saved knowing she was going to start her own
business. The General Manager and Assistant Manager are not obligated to pay any
amount of investment to help start the business. However, since they have chosen
to help finance the Belle Femme Startup, they are provided job security and a voice
in the future of the company, as well as heir to ownership as the current Owners
exit strategy. With the amount of investment saved by the Owner and Managers,
Belle Femme will still need to acquire a bank loan for roughly $55,744. This loan
will be paid off throughout the years with help from the Owner, General Manager
and Assistant Manager. (AESHM 474, Prophecy Software, 2014)
Startup Funding
Personal Savings - Owner
$41,700
$25,000
$15,000
Bank Loans
$55,744
12
Personnel Plan
Year 1
Year 2
Year 3
Year 4
Year 5
Owner
$73,000
$76,000
$90,000
$90,000
$95,000
General Manager
$50,000
$52,000
$60,000
$60,000
$60,000
Assistant Manager
$39,600
$42,000
$43,500
$44,500
$46,000
Style Concierge
$18,400
$4,000
$4,000
$5,000
$5,000
TOTAL PEOPLE
Total Payroll
$181,000
$174,000
$197,500
$199,500
$206,00
0
Year 2
Year 3
Year 4
Year 5
Sales
$513,503
$599,403
$609,402
$620,315
$630,937
$204,820
$237,520
$239,896
$245,911
$249,600
$0
$0
$0
$0
$0
$204,820
$237,520
$239,896
$245,911
$249,600
Gross Margin
$308,683
$361,883
369,507
$374,404
$381,337
60.11%
60.37%
60.63%
60.36%
60.44%
$131,000
$122,000
$137,500
$139,500
$146,000
Advertising
$4,800
$4,800
$4,800
$4,800
$4,800
Depreciation
$4,880
$4,889
$4,889
$4,889
$4,889
$5,500
$5,500
$5,500
$5,500
$5,500
$480
$480
$480
$480
$480
$600
$600
$600
$600
$600
$1,200
$1,500
$2,000
$2,000
$2,000
$3,372
$3,500
$3,600
$3,800
$4,000
$6,204
$6,200
$6,300
$6,500
$6,500
$4,716
$4,716
$4,716
$4,716
$4,716
Gross Margin %
Expenses
Payroll
13
$110
$0
$0
$0
$0
Maintenance - Office
$2,400
$2,400
$2,400
$2,400
$2,400
Marketing and PR
$9,600
$10,000
$10,000
$10,000
$10,000
Miscellaneous
$3,600
$3,600
$3,600
$3,600
$3,600
Payroll - Charges
$797
$800
$800
$800
$800
$600
$600
$600
$600
$600
$1,200
$1,200
$1,200
$1,200
$1,200
$1,500
$1,500
$1,500
$1,500
$1,500
$36,000
$36,000
$36,000
$36,000
$36,000
Repairs
$600
$600
$600
$600
$600
Security
$348
$350
$350
$350
$350
$4,200
$4,200
$4,200
$4,200
$4,200
$8,500
$10,000
$10,000
$10,000
$10,000
$1,440
$1,440
$1,440
$1,440
$1,440
Utilities
$2,100
$2,100
$2,100
$2,100
$2,100
$720
$10,515
$10,890
$11,490
$12,015
Employee Benefits
$9,000
$9,100
$9,100
$10,100
$10,100
Other
$2,400
$2,400
$2,400
$2,400
$2,400
$248,876
$251,490
$268,065
$276,065
$283,290
$59,806
$110,393
$101,442
$98,339
$98,047
EBITDA
$64,696
$115,282
$106,331
$103,228
$102,936
$6,753
$5,963
$5,138
$4,314
$3,489
Taxes Incurred
$15,916
$31,329
$28,891
$28,208
$28,367
Net Profit
$37,137
$73,101
$67,412
$65,818
$66,191
7.23%
12.20%
11.06%
10.61%
10.49%
Rent
Payroll Taxes
Interest Expense
14
Here is a graph representation of our profit projections for the next five years.
Also presented here is a graph of our growing Gross Margin for the next five years.
15
Break-Even Analysis
Belle Femmes break-even analysis below shows what our break-even point in sales
volume per month. According to the graph, with profits along the left vertical axis,
revenues approach the break-even point at $34,501 in revenues for that month.
This is in reference of estimated monthly fixed costs listed below in order to find our
break-even point where we will be neither losing profit nor making additional profit.
(AESHM 474, Prophecy Software, 2014)
Break-Even Analysis
Monthly Revenue Break-Even
$34,501
Assumptions
Average Percent Variable Cost
40%
$20,740
!
Profit (Vertical Axis) X Sales Volume (Horizontal Axis)
16
Year 2
Year 3
Year 4
Year 5
Cash Received
$103,620
$165,709
$225,647
$284,924
$344,513
$513,503
$599,403
$609,402
$620,315
$630,937
Cash Sales
$513,503
$599,403
$609,402
$620,315
$630,937
$513,503
$599,403
$609,402
$620,315
$630,937
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$513,503
$599,403
Year 1
Year 2
$609,402
$620,315
$630,937
Year 3
Year 4
Year 5
17
Cash Spending
$131,000
$122,000
$137,500
$139,500
$146,000
Bill Payments
$275,075
$404,006
$400,156
$409,729
$414,040
$406,075
$526,006
$537,656
$549,229
$560,040
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$10,308
$10,308
$10,308
$10,308
$10,308
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$1,000
$1,000
$1,500
$1,500
$1,000
$417,383
$537,314
$549,464
$561,037
$571,348
$96,120
$62,089
$59,938
$59,277
$59,589
$103,620
$165,709
$225,647
$284,924
$344,513
Dividends
SUBTOTAL CASH SPENT
Net Cash Flow
Cash Balance
References
18
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