We have put our heads together and come up with a store idea and strategy that we believe has the opportunity to grow and thrive. The idea is totally unique, not only to San Angelo, but to most of the country as well. We will look at several factors vital to setting up the store as effectively as possible. The parts we will focus on include the following: situation analysis, objectives, identifying customers, competitive advantages, the overall strategy. We will also define and consider the uncontrollable factors that effect any retail company.
Our goal is to provide our target market with a unique, relaxed, and enjoyable shopping experience, while at the same time providing quality men’s wear at reasonable prices. We will provide a large selection including casual, career, and formal clothing lines. At The Man Store you’re guaranteed to find what you are looking for, or we can get it for you. Service will be a top priority not only to our customers, but to the community as well. We place the utmost importance on maintaining high values and ethical standards and behaviors.
The two men we are assisting in a start-up retail plan are very excited about forming a corporation, however making a good ownership decision is an essential part of the situation analysis and should not be rushed into. We will discuss the men in more depth later. Many factors into account when deciding the most appropriate structure. At first The Man Store will only operate in San Angelo so we decided that turning the store into a corporation owned by stockholders would not be a wise decision financially. Another reason a corporation would not be in their best interest is the danger of a more powerful company buying them out.
We did not want to deal with all of the government policies and restrictions that accompany incorporation. It was decided that the only sensible ownership structure was a partnership. The benefits, profits, risks, losses will be shared equally by both owners. The only drawback considered was the possibility of arising feuds do to liabilities and non-partisan decisions, however both men are sensible businessmen who have grown up and worked well together for years. Another attraction to a partnership structure was the single taxation, which is not always the case with a corporation.
Since both men possess a high level of business and retail savvy they will also manage their store. The men want to be as involved as possible in the operations of their store, and hiring a professional management team would substantially raise costs. The Man Store is a classified as an apparel group, which is a type of non-durable goods store. The men who had a dream of owning their own business realized quickly that a men’s clothing store would best suit their desires and abilities. Fred Rubble and Barnie Jetson are from Dallas, TX but have been planning to move to West Texas to open up their idealistic men’s store.
As boys, Fred and Barnie grew up together in a well to do neighbor hood in North Dallas. Both men received batchelors and masters degrees in business at SMU. Now in their forties, the men have set aside a good deal of money from their respective careers. Playing the stock market has been a big financial advantage as well. Both men are well traveled, down to earth individuals who have a love for fashion. They have done extensive marketing research and studies that have all supported their ideas and dream store in the San Angelo area.
Fred and Barnie love the people and landscape of West Texas, which will be extremely beneficial in forming relationships with their customers and the community. Both Fred and Barnie have great taste in clothes and know what men are looking for in today’s job world. The Man Store will consist of a wide variety clothes specializing in the latest trends in men’s clothing. Of course traditional styles will be available as well. We will have stylish clothes for the professional and non-professional career man, as well as styles more suited for social and leisure activities.
We have projected an adequate start-up cost list and compared it to Fred and Barnie’s financial resources. We have over-estimated the costs to count for unforeseen costs that are associated with starting a new business. Use of Funds Source of Funds Land and building(lease) Personal savings, bank loan Inventory Personal savings, manufacturer credit Fixtures(shelves, carpeting, signs) Personal savings Equipment(cash register, computer) Manufacturer credit
Personnel(sales, floor) Sales revenues, personal savings Promotion personal savings, Sales revenues Miscellaneous(credit sales, repayment) Bank loan, personal savings Apparel sales in the United States rose modestly in 2000 to $182 billion, compared to $180 billion the previous year. The 2 percent increase in apparel sales was a decline from the 4 percent growth reported last year. While still a small percentage of total apparel sales, Internet apparel sales showed double-digit growth. Last year was a difficult year for the retail environment,” said Kim Blanck, NPD Fashionworld account executive. “The slowing U. S. economy took a toll on the results of most retailers and kept a tight lid on earnings growth. Collectively, many different segments of the market posted either slim growth or no growth at all,” Blanck added. Despite these statements, statistics show the clothing retail market to be increasing year j. More specifically, men’s clothing sales has shown to be increasing significantly over the past couple of years.
The 1990’s were marked by significant consolidation among men’s retailers both in the U. S. and Canada. A number of national and regional chains either closed or significantly consolidated their operations. In addition, department stores de-emphasized their focus on, and offerings of, men’s tailored clothing. At the same time, sales of men’s clothing have increased at a faster pace than those of women’s apparel in the past several years. This occurred despite a flat suit market as the business/casual trend in the workplace evolved.
In fact, the emergence of this “third wardrobe” (neither suitsnor jeans) has driven this growth of men’s apparel sales. With its multi-brand, value and customer service strategies, The Man Store feels it is uniquely positioned to capture growing market share of men’s apparel sales. As you can see by the following chart, brick-and-mortar stores are in no danger of being swallowed by Internet or catalog sales. Brick-and-Mortar167,346169,25692. 9 As the sales by market segment chart indicates, overall men’s clothing sales in the private sector has risen 2. 4% since 1999.
This is the second highest increase behind the infants and toddlers. 2000 U. S. Apparel Sales By Market Segment Infants’ and Toddlers’7,65113. 14. 2 Through 2000, mass merchants, off-price retailers and specialty stores, and others continued to experience strong sales growth from this shift in consumer spending, with department and chain stores sales feeling the impact of this trend. This is positive for our store. In fact specialty store growth was up 18%. The following is a question and answer exchange found on Barnard’s Retail Trend Report. It’s contents explain the developing retail trend.
Work. com: So, long term, you think the specialty stores may have an advantage because they are building their brand names early on in customer’s lives? Barnard: That is exactly right. The n ext item is also very important. Traditional department stores have historically made themselves dependent on fashions, usually upscale fashions, designer fashions. Well, designers are losing luster and have, indeed, lost a great deal of luster. And, guess what consumers are more interested in these days then designer items? Home-oriented items, things for the home. America s an aging nation and as we get older, our priorities in life change a little bit. We no longer have to be the first on the block with the latest off-the-wall fashions. We no longer have to be the kind of people that absolutely have to have that famous designer on our derriere or neck. Work. com: Do you think that’s one of the prime factors in what’s causing shoppers to stray from department stores and lean toward the Targets or Kmarts? Barnard: Or the Home Depots, the Bed Bath and Beyonds, the Linen and Things and the William Sonomas and the Crate and Barrels and so forth.
They are looking for lower prices. Look at, for example, what happened to Hennes and Mauritz: Beautiful fashions, very attractive, very inexpensive. They’re right on Fifth Avenue and if you are lucky, you can get into the store without any wait in line outside. It’s a tremendous attraction and that really takes a lot of market share away Work. com: To what do you attribute the fact that consumers are now OK with not spending so much Barnard: Casual is in. And if casual is in, casual is less Work. com: Do you see that changing any time soon? Barnard: No, I do not. Not anytime soon.
Not anytime in the foreseeable future. And then there’s also something else, and that is, again, that as we get older we tend to place a lot less emphasis on wearing the latest up-to-date fashions. We want practical things, we want fashionable things, we want good quality things, well displayed good assortments in the store, but we don’t want to go broke buying them. Work. com: Let me see if I get this straight. It’s a combination of the fact that the generation that once only shopped at department stores is now getting older and changing its priorities, coupled with the fact that ounger kids are leaning toward specialty stores. Barnard: And are developing the specialty-store habit. Work. com: How is multichannel retailing redefining the retail landscape? Will we witness eventual consolidation to the point where, in order to compete, a company has to have all channels covered? Barnard: Undoubtedly, we are already in the midst of precisely that. The only thing that we don’t know yet is to what extent will online retailing become a major factor? At the present time, it isn’t. At the present time online retailing accounts for a miniscule portion of the entire retailing pie.
Work. com: Do you foresee it taking more market share? Barnard: Yes, it is likely to take up more market share. But then again, I say it with some hesitancy because there are a lot of indicators that seem to show at least that, yes, more people are buying, but there is also a clear indication that some people seem to say, ‘No, let’s go right back to the store and perhaps use online retailing to fill in. ’ So we don’t know as of yet. It is too new, too young and going through too many changes for us to be able to come to a reasonable conclusion
The work environments today are evolving from the suits and tux to a more casual style. The word casual does not mean khakis and t-shirts yet a more refined dress casual style. The Man Store will address the question of what this means with new merchandise, personalized service, and a “casual know-how” training program that all of the employees will go through. As a result, men will have the confidence necessary to navigate the sometimes confusing landscape of the dress casual revolution. There are always elements that effect a business that are out of owners and managers immediate control.
These factors can have a positive or negative effect on the business. Demographics show that most of the middle-class and higher incomes are the blue-collar working class. Some of the major employers in San Angelo are Vorizen, Sitel, Angelo State University, Goodfellow AFB, Ethicon, and the Town and Country corporate offices. San Angelo is also home to a large number of lawyers, doctors, and other professionals, most of whom are into status symbols and run in social circles. We believe that this variety of people will contribute greatly to our potential customers.
There is not another store in the area that offers the quality and styles at such an affordable prices. Now San Angelo en can feel confident they are getting the latest styles right here in town. One “gamble” that we would like to take involves the majority of the floor staff at The Man Store. San Angelo has been labeled a conservative community at times, therefore there was some hesitation about employing attractive females to assist the shoppers. However, this is one of the main ideas that makes The man Store unique. Hooters restaurant has proven to be a success .