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LETTER OF TRANSMITTAL

DECLARATION I _______________________________ understand that plagiarism is defined as any one or the combination of the following: 1. Unaccredited verbatim copying of individual sentences, paragraphs or illustrations (such as graphs, diagrams, etc.) from any source, published or unpublished, including the internet. 2. Unaccredited improper paraphrasing of pages or paragraphs (changing a few words or phrases, or rearranging the original sentence order). 3. Credited verbatim copying of a major portion of a paper (or thesis chapter) without clear delineation of who did or wrote what. (Source: IEEE, The Institute, Dec, 2004) I have made sure that all the ideas, expressions, graphs, diagrams, etc., that are not a result of my work, are properly credited. Long phrases or sentences that had to be used verbatim from published literature have been clearly identified using quotation marks. I affirm that no portion of my work can be considered as plagiarism and I take full responsibility if such a complaint occurs. I understand fully well that the guide of the seminar report may not be in a position to check for the possibility of such incidences of plagiarism in this body of work. Signature:

Name: Date:

ACKNOWLEDGMENT

We owe a great thanks to the people who have helped and supported us to make this Project Report on A LA MODE LINGERIE. Our Deepest thanks to Mr. Rahul Jain & Mr.Ashish Batra who have mentored us and corrected our various documents with attention and care. They have taken pains to go through the project and make necessary changes when required. We would also thank our institution and faculty members without whom the project would not have been a distant reality. Our special thanks to Mrs. Bhavna Chadha for giving the report format, Mr. Virendra Malik for enhancing computing skill and Mr. Avijeet Ganguly for motivating and teaching the human resource aspect of a business. We Would like to thank Ms.Ritu Jain , Ms.Dilpreet Kaur , Mr.Somnath Sahu required. &

Ms.Mollshree for supporting us everywhere and they were available whenever it was

Disha Jain Manan Jain Prachi Rathi

CONTENT

CHAPTER No. 1 2 3 4 5 . 5.1 5.2 6 7 8 9 10 11

TITLE Introduction Concept Merchandise Planning Economic overview Store operations

PAGE # 1 6-8 9-12 13-20 21-26

Location selection Market analysis Product development Competitor analysis SWOT Analysis Financials Human Resource Visual merchandising

21 22-26 27-37 38-40 41-43 44-59 60-63 70-73

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Promotion Conclusion Bibliography

74-78 79-80 81-82

INTRODUCTION

Ala mode is a super premium brand specializing in intimate wear for young women. It is a Delhi based brand with manufacturing unit in Delhi and Ghaziabad. ALA MODE [ l md l (French) a la mod], meaning in the current fashion or, being or in accordance with current social fashions; "fashionable clothing"; "the fashionable side of town"; "a fashionable caf.

ONE BRAND INDIAN PAINSTAKING SKILL CREATIVE AND FASHIONABLE YOUNG AND CREATIVE FOR WOMEN BY Ala Mode

WE DONT JUST DESIGN TRENDY AND FASHIONABLE LINGERIE, BUT ALSO PASSIONATE ABOUT CREATING BRAS WITH THE PERFECT FIT. A unique saga, astonishing, knock out products and colors. Long live womens freedom and fashion lingerie. Shebam!blop!whiz!

CHAPTER 2 CONCEPT

Mission Our mission is to provide the high-end quality products at the best and affordable price catering to the needs of every women through customization and providing perfect fits and excellent after sale services in order to ensure the achievement of our vision and gain complete customer loyalty.

Vision Brand is committed to be the leading high-end fashion brand in India through customer orientation. The long-term goal of the brand is to transmit itself, globally.

Values 1) Every employee staff would comply with employment legislation. 2) The disabled people would be treated equally. 3) A gender friendly workplace. 4) Health & Safety Environment provided to the employees. 5) It is the Companys policy to comply fully with all applicable laws and regulations. The Company cannot accept practices which are unlawful or may be damaging to its reputation.

GOALS & OBJECTIVES 1) The predominant objective of the brand is to provide the Indian youth females an affordable lingerie which is affluent, fashionable & modern. 2) To provide Indian Girl & Women a good shopping experience, aura and THE PERFECT A LA MODE FIT. 3) To become of the leading brand in achieving business by on time, quality & right cost. 4) To fill the need gap between the customers of brands like enamor & La Senza. 5) To work as per the market trends and achieve what the young generation is demanding. 6) To develop a product design & work on the visual merchandising of the brand theme focusing

COMPANY STRATEGY Continue to focus on the chosen portfolio of Lingerie, sleepwear, accessories, swimwear & stockings. Create distributed leadership within the organization by nurturing talented and focused top management teams for each of the businesses.

CHAPTER 3 MERCHANDISE PLANNING

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TARGET MARKET SEGMENT

ALA MODE products are designed for young people of all ages, colors, nationalities. Demographics: Age Group: It targets to wide age group from 16 to 30years of women but the brand is most popular between the age group 16-22 years old. Marital Status: Mostly Single Sex: Female Income Group: Upper-middle Class Occupation: College goers or working women Ala mode consumers are young women in particular, who belong to the age group of 16-30 or above. Individual customer Prachi, who primarily shops for lingerie once in 2months. Her personality is more toward the compliant category, which means she is capable of being liked by others and also seek approval from others. She is materialistic i.e. for her possessions are important. She agrees to own things that impress others and gives her pleasure. She is far off from compulsive shopping and is a normal shopper. any women with youthful minds who wants to dress fun and fashionable. Their average monthly income should be approximately Rs. 50,000 and

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For her physical appearance is very important and care about her own looks. She scales average on achievement vanity segment.

MERCHANDISE PLANNING

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PRICING STRATEGY

PENETRATION PRICING STRATEGY Well use this strategy because it is associated with a marketing objective of increasing market share or sales volume, rather than to make profit in the short term. Psychological Pricing Strategy- odd ending of the prices of the product. Discounts Strategy for 2 months for the sale period: -

MULTIPLE-UNIT PRICING Objective: To increase sales volume. 3 Panties for 300 Rs. Where each pantys M.R.P. is 125 Rs.

PRICE BUNDLING Objective: To create value A complete package of a pair of lingerie, a sleeping mask & bow Bra is of Rs.1300, Panty- Rs. 300, Sleeping mask- Rs.300, Bow- Rs.300 (Hence, customers save Rs.400)

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PRICE QUALITY POSITIONING- BRAND VALUE Brand value means something to the end user. Brand name can be used to increase overall utility of a choice, or may detract from the overall utility of a choice. To calculate the maximum value formula applies is

Maximum Value= Benefit/ Cost

PRICE High Medium Low

High Value High

QUALIT Y

Medium

Low

CHART

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Looking at chart-2, we analyze that A La Mode lies at the HIGH VALUE segment. It is a high-priced brand, which has a high quality and satisfies its target market very well. This could be seen above where perceptual mapping of the brand has been showing.

CHAPTER 4 ECONOMIC OVERVIEW

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Industry Status in India

The lingerie market in India holds in its infant period and, until in recent years, the accessibility of high quality intimate apparel was limited to irregular or grey imports sold in the counter. Because of the limited products and not enough specialized and arranged retail atmosphere, the fashion realization and quality awareness of the Indian consumer with regard to intimate apparel is yet to be realized. India is also just about the most scattered retail markets in the world. The products, so considerably, have been mainly marketed being a commodity and are price and margin oriented. Till today huge quantities of bras are sold to end-users by male salespersons in mom-and-pop stores. Majorities of the stores don't even provide a trial room. As an end result, large consumer base are certainly not sure of the functional attributes of a bra or even their own sizes. Across India Enamor surveyed and measured 4, 000 a lot of women. They noticed that 80 % of Indian women dressed in an uncomfortable fitting underclothing. In India, bras were made only in M and C cup sizes, though Enamor's research found that a lot of Indian women required Some sort of or D cup different sizes. Today 70 % of the lingerie market of India is unorganized. But that could be replaced with the increase in the quantity of malls and quality-conscious consumers.

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The joint market contribution in the leading five retailers in India totals lower than two per cent. Nevertheless, Lingerie sales have improved by 14 per cent in the past five years because on the new awareness of intimate wear. Women's innerwear industry in India will probably be worth Rs. 2, 000 crore and it is growing at an normal rate of 14 %. Turkey and Bangladesh have previously observed the potential and tend to be aggressively promoting its innerwear industry. Many Asian countries are defeating India the united states, the world's biggest clothing importer. According to the us office of Textiles and Apparel, in 2002 the country imported 198, 094, 426 dozen fecal material cotton underwear. India's contribution within this was a paltry 2. 36 per cent. In bras using manmade product, the US imported thirty seven, 676, 800 dozen sections. While China constituted 32 per cent of these, Indonesia possessed 10. 5 per nickle. Even Bangladesh had 1 per cent. However, India exported a meager 0. 65 per cent. Though, there is a great potential to be taped if approached in the organized manner with an appropriate set up. Womens Wear: The most profitable segment The Rs. 29, 375-crore womens wear apparel segment covers 32. 1 percent share with the Indian apparel market with value terms. In amount terms, market share of womenswear is one percent greater than that of menswear , in value terms its discuss is five percent lower than that of menswear as a result of branded segment in womenswear was practically non-existent till many years back. At present, it is the most profitable segment with regard to investment. During 2005, volumes increased by 5. 5 percent while value appreciation was as high as 15 percent. In 1971, VIP entered the men's underwear market with a big-bang and became probably the most talked about brand because of its advertisement featuring model Dalip Tahil. Since that time VIP is a leading player in the men's and women's underwear market. VIP launched Petals, a Lycra moulded cup bra with motifs, which was accepted well regarded as, but was later terminated.

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Another leading brand in the lingerie market is Rupa & Company established in 1985. Its number of men's, women's and children's underwear put together makes it India's largest innerwear manufacturer and seller. Besides these two brands you can find other labels produced by them. Amul, Lux Cozi, Dollar are most of the brands catering to a particular segment of the men's underwear market, while the lingerie segment has its own local offerings like Neva, Bodycare, Softy, Young lady Care, Little Lacy, Green Rose, Sonari, Feather Line and numerous others. In the 90s Jockey re-entered the Indian market pursued by Calida and Liberti Blu. Than the very high fashion Gossard existed to get a limited time. In this 21st century, Enamor, another foreign brand moved into the Indian market through Gokaldas Exports and the very chic French company Aubade started its just outlet in Mumbai. La Senza could be the next foreign brand that's set to enter sales while Hanes has already set which includes a very unconventional ad campaign specific for comfort for the Indian native male. One of the main foreign players in this Indian lingerie market is actually Triumph. They have a presence in 150 countries world wide and a turnover people $2 billion with a production of over 150 million units annually, producing 6000 new fashion styles per annum designed by 200 graphic designers in 11 countries. Triumph started its operation with India in six metros, and it is now spread in forty-five cities. As far as lingerie is concerned, India is still in its initial stage. India has to wait to become matured market as compared to the other Asian markets enjoy Japan, Hong Kong, Singapore, Japan and Vietnam. In the last three years there is a great growth in the business but the retailing associated with lingerie and distribution options are limited. Triumph marketplaces through retailers, MBOs, and two franchisees in Mumbai together with Kolkata, and further more they will increase in the near future. From 300 outlets with India they target to help cross 1, 000 stores in three-five years. With all recycleables imported from Europe, Triumph is produced in Chennai and has gained a 50 per cent raise in sales due to the fact came into the nation. Though, Triumph is the only internationally managed brand, in addition, it aims to satisfy

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Indian buyers and has the capability to origin intelligent fabrics not offered in India. Triumph was the main to introduce moisturising materials with Aloe Vera along with the one-piece bra which is that is generated by one piece of clothing. The sizes and styles are extremely particular to Indian clients. Triumph which begun production in India in 1998 may be exporting to the USA before it arrived to the local market. With 80 per cent exports and 20 per cent local sales in India, Triumph adds new solutions and concepts for 5-10 styles on a yearly basis. Lately, well-known international lingerie brands - Aubade - from the fashion capital of France has entered in Indian native market. While the international lingerie outlook is as exciting and bright for the reason that outerwear one, India's growth in the former segment can be called pretty much negligible. Body and beach trend shows are showcased twice a year around the world showing the latest trends in innerwear fashion. New underwear fabrics with 'anti' procedure like anti-stress, anti-smog, anti-static, anti-allergic, anti- microbe, anti-moisture and anti-odour pamper your system. Top European products such as Bruno Banani, Excellent, Schneider, Louis Feraud, Calvin Klein, Gianfranco Ferre, DKNY, Los angeles Perla, Gossard, and Schiesser are most of the brands that set their inspiration to your ultimate test. Thanks to the innovative outerwear performance made by designers around the world and India, lingerie is usually seemed with renewed fascination in India too. It could be shocking that there are generally 1000 Indian brands available but only 200 are generally nationally active. The others cater to markets in the vicinity of their production. Many of these brands have to date continued the advent of MNC labels for the last decade and should continue to accomplish this. The Indian lingerie Industry is growing due to the increasing domestic demand in conjunction with huge export potential. It will soon receive an establishment position. From a cottage industry it can also be transformed into a increasing trade. Indian brands have experienced that they have to be more quality sensitive and work

19

harder within branding, promotion, packaging together with innovation. Only the mindset to make world class lingerie is actually lacking. Smaller countries like Sri Lanka, Turkey and Bangladesh are major producers in such a segment. Indian companies have recognized the worthiness of innerwear for men and women and the competition is boiling as new plus more players arrive to offer Indians a whole lot of required fashionable lift.

The Indian Lingerie and nightwear market was valued $2 billion (8700 cr) in 2011 and is expected to grow at the rate of 15%. Total organized retail of lingerie in India is 17.24 % i.e. 1500 cr. Super premium category, which is growing, at the rate of 30%.

LINGERIE SALES GRAPH (2009-2012)

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MARKET DESCRIPTION - LINGERIE According to the report, which is now in its fifth edition, the worldwide lingerie retail market - which includes bras, briefs, daywear and shape wear - grew from US$29.17bn to US$29.92bn between 2004 and 2007. It then fell in both 2008 and 2009 bottoming at US$28.91bn. Following a modest recovery in 2010, 2011 was another difficult year with the market estimated at US$29.37bn. Over the period, this is growth of only 0.7% in seven years. The lingerie market at retail prices is now predicted to be worth US$29.23bn in 2012. This is marginally (down by 0.5%) less than the 2011 figure. Growth will be modest in 2013, but will then get back to a form of normality. By 2017, the world lingerie market will be worth US$30.55bn. The lingerie retail market in 2013Although just-style believes that world markets will start to recover from 2013, demographics and consumer economics will continue to work against Western Europe - apart from the UK, if its net immigration continues unabated.

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Consumer economics will also continue to work against the US, which will far outweigh a more positive scenario in Canada. The BRIC economies (Brazil, Russia, India and China) will continue to prosper but the textile exporting industry of Brazil, India and China will all be affected by continuing weak demand from the developed world. Lingerie brands segmentation: ECONOMY: Bodycare, Paris Beauty Rs 100-300 Mid market: Hanes, jockey, Daisy Dee , Juliet, Red rose. (Rs 250-500) PREMIUM: Enamor, Amante (Rs500-800) SUPER PREMIUM: TRIUMPH. BWITCH (Rs 800-3000)

FUTURE POTENTIAL GROWTH It is predicted that the lingerie market at retail prices will be worth US$29.23bn in 2012, rising to US$30.55bn over the next five years. (The data specified is worldwide)

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SOURCE: ECONOMIC TIMES- SERENA REESE (M&S) (Scenario%20Of%20Intimatewear%20Market%20-%20HarryCoffeyLionel%20-%20DailyBurn %20Tracker.webarchiv

CHAPTER 5 STORE OPERATIONS

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5.1 LOCATION SELECTION A LA MODE is a super-premiuim brand targeting the females of youth majorly. The location of the brand for launching its 1st store would be PACIFIC MALL,SUBHASH NAGAR. The reason for choosing this location is that, this is kind of new mall which came just 3-4 years back & has all good super-premiuim brands. It has our main competitior also which is La Senza. It gives us a good competitor feel to be there & place our brand in that mall. For Rent agreement, see Annexures.

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5.2 MARKET ANALYSIS

Q1. Which type of fit would you like to purchase mostly? a) Basic (white, black & skin) b) Sensual c) Trendy & Fashionable

Q2. How much would you like to spend on a single purchase? a) Rs.800-1000 b) Rs.1000-1500 c) Rs.1500-2000 d) Rs.2000& Above

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Q3. Are you facing any problem with existing super-premium lingerie brands Bra? a) Yes b) No

Q4. How often do you prefer to buy a Bra? a) Once in a month b) Once in 2 months c) Once in 3 months d) Once in 4 months

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Q5. Generally, where do you prefer to go for buying lingerie? a) Malls b) High Street c) Local Markets d) Department Stores e) Online

Q6. Which locality do you generally prefer to buy lingerie from? a) South Delhi b) North Delhi c) West Delhi d) East Delhi

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e) Central Delhi

Q7. Do you think that existing super-premium lingerie brands products are expensive?

a)Yes b)No

Q8. Do you think existing super-premium lingerie brands are offering something exclusive for Indian Market?

a) Yes

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b) No

CHAPTER 6 PRODUCT DEVELOPMENT

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PROCESS OF PRODUCT DEVELOPMENT

A La Modes Product Development began with the procedure of detailing of the project. It comprised the development of a new product with the help of theme board, mood boards and which could give a proper layout of a store. The second step was, to decide how A La Mode would look like. The planning of the outlay was planned. The product range A La Mode would have in the store was decided. Eventually, it was decided that we would like to open up a lingerie store for young women. The themes were decided & accordingly, theme boards were designed which could illustrate what kind of our store would look like. Themes like skulls, lips and moustaches, caricatures & neon. Then, the color forecasting for spring summer 2013 was been asked to done. The international color trends were decided for respective theme boards. Consequently,

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3 theme boards were made for all the color boards. The fabrics, swatches trims, & elastics were being arranged for one final theme .The textile prints were designed on the grounds of final theme & color board. Ultimately, the whole range of the product categories was decided on the final theme, which is Lips & Moustache. After the final collection, the promotions were designed along with posters, visiting cards, paper bag, gift-wrap and box, letterhead, tags.

CHAPTER 7
31

COMPETITOR ANALYSIS

LA SENZA
La Senza Corporation is a Canadian fashion retailer based in Dorval, Quebec, Canada,which sells lingerie and intimate apparel. The La Senza brand is currently owned by Limited Brands.

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PRODUCT

PRICE La senza pricing tactic is to provide high Quality merchandise at high prices, according to the Indian market. It provides customers with outstanding personal services, while combining Quality, Fit & Value. The companies usually price their products lower than their competitors and replenish their products frequently. In case of la senza, there is no competitor in the market yet in terms of trend and quality of lingerie. Their price range starts from Rs.300 and goes up till Rs.3000. Pricing includes: Modal bras- 2 for Rs.1700, The show off bra- 3 for Rs.2500 Buy one sexy bra; get the second 50% off.

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PLACE La Senza has expanded substantially in recent years and today we have around 360 stores spread across 30 countries. In India, it has 12 stores in totality across Mumbai, Bangalore, Pune and Delhi. Delhi has 4 La senza stores.

PROMOTIONS Standard promotions like 2 for $X or 3 for $X promotions on bras and panties. Special promotions like coupons or vouchers, gifts cards or loyalty cards.

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CHAPTER 8 SWOT

SWOT ANALYSIS
STRENGTHS The brand will give every woman a favorable & encouraging body image. A wide variety of sizes. The products offered are catered to female of young generation who have good acceptance to new themes of the brand. The lingerie market has been growing at a rate of 14% CAGR (Compound 35

Annual Growth Rate)

WEAKNESS The Indian market is price-sensitive. The Indian market is a little conservative society. Emerging lingerie companies.

OPPORTUNITIES Global Expansion Increasing awareness is shaping the consumer demand Significant growth in upper-middle class society; more disposable income There are presently 36 stores selling lingerie online; and it is a growing market. More nuclear families; women have more opportunities to check out and spend. Shift in focus to mid & upper segment can prove as an opportunity as it is the fastest growing sector at a CAGR of 30%. THREATS Local vs. Global players International vs. domestic players Threats from already existing brands of inner wear to move into fashionable & modern lingerie.

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CHAPTER 9 FINANCIALS

Competitors sales ( La Senza) =Rs 37257300 annually Area of the store= 1190 sq.ft A La Mode area of the store = 1000 sq ft SPF of la Senza = Rs. 31308 sq ft/ annually A La Modes sales annually= Rs 31308000 per annum 38

Assuming our sales is 50% of competitor sales =50% of competitor sales per sq ft* area of the store = 50%* Rs. 31308000

=Rs 15654000 (Annually)

Preliminary expenses. =15% of annual sales =15%* 15654000 =Rs 2348100

Working capital =40% *15654000 =Rs 6261600

Gross margin =50% *15654000 =Rs 7827000

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INITIAL INVESTMENT

PARTICULARS

AMOUNT

Working Capital Investment

Rs 6261600

Initial investment in Fixed Assets Interior= Rs.1500*1000 Computer=Rs 20,000 Scanner= Rs. 6,500 Receipt printer= Rs.10,000 Printer= Rs. 7,000 Speakers = Rs. 7,000 Software = Rs. 20,000 CCTV = Rs. 15,000 Furniture&Fixtures = Rs 6,00,000 Total = Rs.2185500 Rs.1500000

Preliminary Expenses

Rs 2348100

Total

Rs 10795200

INCOME STATEMENT FOR YEAR 1 ST YEAR

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PARTICULARS Sales Less: Markdowns (6%) = Net Sales Less: COGS = Gross Margin Less: Office and administration overheads (Rs.3268482) Selling and distribution overheads (Rs.2642868) = Operating Profit (EBIT)

AMOUNT Rs.15654000 Rs. (939240) Rs. 14714760 Rs. (4696200) Rs. 10018560 Rs. (5911350)

Rs. 4,107,210

Less : preliminary expenses written off = EBT Less: income tax 33.99% = EAT (Net Profit)

Rs. (469620) Rs. 3637590 Rs. (1236416) Rs. 2401174

Working notes: 1. OFFICE AND ADMINISTRATION OVERHEADS( Annually): PARTICULARS Rentals Electricity Salary ( store manager) Depreciation Staff incentive Staff commission Staff welfare AMOUNT 18,00,000 6,00,000 240000 116800 78270 78720 78720

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Telephone & Internet Shrinkage Repair Insurance Security

36000 93924 31308 36500 13140

Miscellaneous

60,000

Total

Rs.3268482

2.

SELLING AND DISTRIBUTION OVERHEADS (Annually):

PARTICULARS Advertisement Logistics Sales promotion Salary (Housekeeping, Sales staff,Securiy Guard) Conveyance C card commission Alteration Miscenalleous Total 3. SALARY PARTICULARS AMOUNT

AMOUNT Rs.1565400 Rs.156540 Rs.313080 Rs.276000 Rs.60000 Rs.93924 Rs.93924 Rs.84,000 Rs.2642868

TOTAL AMOUNT

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Basic salary2 Sales Staff @ Rs.5500 p.m. HRA3,300

5,500

Rs.11,000

Travel allowanceHousekeeping @ Rs.4,500 p.m. Security Guard @ Rs.4,500 p.m Uniform @ Rs.600 per person TOTAL 1 X Rs.4, 500 1 X Rs.4, 500 5 X Rs.600

2,200 Rs.4, 500 Rs.4, 500 Rs.3, 000 Rs 23,000

4. DEPRECIATION PARTICULARS Computer (40%* 22,000) Fixtures (18% *6,00,000) Total Depreciation AMOUNT Rs. 8800 Rs. 108,000 Rs. 116800

5. LOGISTICS =1% * annual sales =1%* 15654000 =Rs. 156540

6. PRELIMINARY EXPENSES WRITTEN OFF: =1/5th of Preliminary Expenses =1/5th * Rs 2348100

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=Rs 469620

7. CALCULATION OF MARKDOWN La senzas( 1.Competitor of A La Mode) sale during sales period=Rs. 55,00,000+ Rs. 55,00,000 = Rs. 11000000 Seasonal sale%= Rs.37257300/ Rs. 11000000 = 3.38%

Private lives (2.competitor of A La Mode) sale during sales period= Rs. 30,000,00+ Rs. 30,000,00 = Rs. 60,000,00 seasonal sale%= Rs.16000000/ Rs. 60,000,00 = 2.66% average of both competitors= 3.38% +2.66%/2= 1.73%. average markdown = 30 + 40/2= 35% sales promotion = 35% * 1.73 % = 6%.

8. BREAKEVEN ANALYSIS Net Sales= Rs. 14714760 Variable Cost= Cost Of Goods Sold+ Selling & Distribution Overheads.

Therefore, Variable Cost= Rs.4696200+Rs.2642868 = Rs.7339068 Fixed Cost= Office& Admnistartion Overheads+Preliminary Expenses.

Therefore, Fixed Cost= Rs.3268482+Rs.469620 =Rs.3738102 44

Contribution Margin = Net Sales- Variable Cost

Therefore, Contribution Margin= Rs.14714760-Rs.7339068 = Rs.7375692

Contribution Margin Ratio=Contribution Margin /Sales*100

Therefore, CMR= Rs.7375692/ Rs.14714760*100 = 50.12%

Breakeven Sales= Fixed Costs/ Contribution Margin Ratio = Rs.3738102/50.12% = Rs. 7,458,304

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PROFITABILITY RATIOS GROSS MARGIN RATIO: =Gross Profit / Net Sales*100 = Rs.10018560/Rs.14714760*100 = 68.08% NET MARGIN RATIO: = Net Margin/Net Sales*100 = Rs.2401174/ Rs.14714760*100 = 16.3%

RETURN ON INITIAL INVESTMENT = Net Profit/ Initial Investment *100

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=Rs.2401174/Rs 10795200*100 = 22.24%

INVENTORY TURNOVER RATIO =Total Months/Stocks to sales ratio = 12/2.5:1 = 4.8 Times ( Annually)

COSTS AND REVENUE AS % OF SALES COSTS:

COGS: Rs.4696200/15654000*100 = 30% SELLING AND DISTRIBUTION OVERHEADS: = Rs.2642868/ Rs.15654000*100 =16.88 % OFFICE AND ADMINISTRTION OVERHEADS: =Rs.3268482/Rs.15654000*100 = 20.87%

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Annual Cashflow: EBIT+Depreciation+Preliminary Expenses-Taxes Rs. 4,107,210+Rs.116800+Rs.2348100- Rs.1236416 =Rs6572110- Rs.1236416 = Rs.5335694 Payback Time= Initial Investment/ Annual Cashflow = Rs.10795200/Rs.5335694 = 2 YEARS

GRAPHICAL PRESENTAION OF COST AS % OF SALES

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REVENUE:

NET SALES: = Rs.14714760/Rs.15654000*100 = 94% GROSS PROFIT: =Rs. 10018560/ Rs.15654000*100 =64% OPERATING PROFIT: =Rs. 4,107,210/Rs.15654000*100 =26.23% EBT: Rs. 3637590/Rs.15654000*100 =23.23% EAT(NET PROFIT): =Rs.2401174/Rs.15654000*100 = 15.33%

GRAPHICAL PRESENTATION OF REVENUE AS A % OF SALE

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INCOME STATEMENT FOR THE YEAR 2ND YEAR

Particulars Sales Less: Markdowns (6%) = Net Sales Less: COGS = Gross Margin Less: Office and administration overheads (Rs.3263522)

Amount Rs.17845560 Rs. (939240) Rs. 16,906,320 Rs. (5353668) Rs. 11552652 Rs. (6393747)

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Selling and distribution overheads (Rs.3130225) = Operating Profit (EBIT) Rs. 5158905

Less : preliminary expenses written off = EBT Less: income tax 33.99% = EAT (Net Profit)

Rs.535366 Rs. 4623539 Rs. (1571540) Rs. 3051999

Working notes: Office & Administartion overheads: PARTICULARS Rentals Electricity Salary ( store manager) Depreciation Staff incentive Staff commission Staff welfare Telephone & Internet Shrinkage Repair Insurance Security AMOUNT 18,00,000 6,00,000 264000 93840 78270 78270 78270 36000 93924 31308 36500 13140

Miscellaneous

60,000

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Total

Rs.3263522

DEPRECIATION: PARTICULARS Computer (40%* Rs.13200) Fixtures (18% *4,92,000) Total Depreciation AMOUNT Rs. 5280 Rs. 88560 Rs. 93840

SELLING AND DISTRIBUTION OVERHEADS (Annually):

PARTICULARS Advertisement Logistics Sales promotion Salary (Housekeeping, Sales staff,Securiy Guard) Conveyance C card commission Alteration Miscenalleous Total

AMOUNT Rs.1784556 Rs.178455 Rs.535366 Rs.3,00,000 Rs.60000 Rs.93924 Rs.93924 Rs.84,000 Rs.3130225

SALARY PARTICULARS AMOUNT TOTAL AMOUNT

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2 Sales Staff @ Rs.6050 p.m Housekeeping @ Rs.4,950 p.m. Security Guard @ Rs.4,950 p.m Uniform @ Rs.600 per person TOTAL

Basic salary-

Rs.12,100

1 X Rs.4,950 1 X Rs.4,950 5 X Rs.600

Rs.4, 950 Rs.4,950 Rs.3, 000 Rs 25,000

Preliminary expenses. =15% of annual sales =15%* 17845560 =Rs 2676834

Working capital =40% *17845560 =Rs 7138224

ANNUAL CASHFLOW ( 2nd year)

EBIT+Depreciation+Preliminary Expenses-Taxes Rs. 5158905+ Rs. 93840+ 2676834- 1571540 = Rs. 6358039

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54

INCOME STATEMNT FOR 3RD YEAR :

Particulars Sales Less: Markdowns (6%) = Net Sales Less: COGS = Gross Margin Less: Office and administration overheads (Rs.3269469) Selling and distribution overheads (Rs.3630225) = Operating Profit (EBIT)

Amount Rs.20343938 Rs. (1220636) Rs. 19123301 Rs. (6103181) Rs. 13020120 Rs. (6899694)

Rs. 6120426

Less : preliminary expenses written off = EBT Less: income tax 33.99% = EAT (Net Profit)

Rs.610318 Rs. 5510107 Rs. (1872885) Rs. 3637221

Preliminary expenses. 55

=15% of annual sales =15%* 20343938 =Rs 3051590

Working capital =40% *20343938 =Rs 8137575

RANGE PLAN

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SIX-MONTH MERCHANDISE PLAN

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CHAPTER 10 HUMAN RESOURCE

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HUMAN RESOURCE

STAFFING PROCESS

Recruitment Process

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Ensures that provided candidates, are most suitable for your specific requirements. Our trained consultants pre-screen and pre-select applicants before submitting their details - for we want to assure accurate matching between our company and any prospective employee. Collection of Curriculum Vitae from applicants interested in one or more of our offers. Every Curriculum Vita would allow for easy comparison of each candidate's details. Performing the first telephone interview in order to make preliminary assessments of the overall competency of a candidate, especially in regards to their level of English. All documents are then collected and reference checks are performed including employment history, criminal background and health checks. If the panel is fully satisfied with the results and feel confident that the candidate is suitable for your specific requirements, then the second interview is done and later sends the application to the potential employer who then obviously makes the final decision.

Selection Process

The selection process is objective and robust. A range of selection tools are used. These include assessment centres, group tasks and in-depth personal interviews. Candidates found suitable for employment would be immediately given offers to join A La Mode . After a comprehensive induction programme, they would be assigned to various businesses of the Company. A La Mode would also like to selects first-year students for Summer Internships

The team of A La Mode would visits campuses between December and March for final placement. The process consists of group discussions and personal interviews

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preceded by psychometric tests and assessment centres. Employment offers are made to selected candidates immediately. Employment offers are made to selected candidates immediately. A La Mode believes in taking out the best out of the pool of application received during recruitment process. It believes in infusion of new blood in their organisation. Training and Development

Training would be considered a crucial aspect in

A La Mode because of

chanding standards of technology and its services. Training courses would be sometimes offered for 6 months with internship so it invites freshers which are motive of A La Mode. Good Corporate Citizenship A Gender Friendly Workplace As a good corporate citizen, A La Mode is committed to a gender friendly workplace. It seeks to enhance equal opportunities for men and women. Sexual harassment includes unwelcome sexually determined behaviour such as: unwelcome physical contact; a demand or request for sexual favours; sexually coloured remarks; showing pornography and any other unwelcome physical, verbal or non-verbal conduct of a sexual nature. A La Mode would maintain an open door for repartees; encourages employees to report any harassment concerns and is responsive to employee complaints about harassment or other unwelcome and offensive conduct.

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CHAPTER 11 VISUAL MERCHANDISING

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NAME AND LOGO ALA MODE [ l md l (French) a la mod], meaning in the current fashion or, being or in accordance with current social fashions; "fashionable clothing"; "the fashionable side of town"; "a fashionable caf. The font used in the logo is Madonna, with a tint of pink color in it signifying a color for girls

The concept of ala mode is to create a lingerie store that inspires people to want to explore. In India, lingerie customers basically want privacy and comfort. Therefore, all environments are dark, with some focal points in lighting products. Accordingly, the color palette for the store used is dark earthy colors like shades of brown and gray. Visuals of ALA MODE are inspired from a store Gilly hicks.

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FIXTURES QUANTITY AND PLANOGRAM Featured wall: Gloss panel wall

QUANTITY

FIXTURES

SIZE

PLANOGRAM (MERCHANDISE QTY) (SKU)

5 9 2

TABLES TABLES FEATURED WALL

6*3 4*2 14*8

50*5 = 250 30*9 = 270 400+475 = 875

FEATURED WALL

15*8

700

FEATURED WALL

12*8

400

FEATURED WALL

8*8

125

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Flooring: wooden

MERCHANDISE Stack/hang ratio = 4:1 Total number of SKUs per month = 2500

LIGHTINGS USED IN THE STORE: Accent Lighting adds drama to a room by creating visual interest. As part of a decorating scheme, it is used to spotlight paintings, houseplants, sculpture, and other prized possessions, or to highlight the texture of a wall, drapery or outdoor

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landscaping. Accent lighting requires at least three times as much light on the focal point as the general lighting around it. This usually is provided by track, recessed, or wall-mounted fixtures. Track lighting is a method of lighting where light fixtures are attached anywhere on a continuous track device which contains electrical conductors. This is as opposed to the routing of electrical wiring to individual light positions. Tracks can be mounted to ceilings or walls, lengthwise down beams, or crosswise across rafters or joists. They can also be hung with rods from especially high places like vaulted ceilings. Track and Rail Lighting Track lighting has long been the standard for task, accent and wall wash lighting in retail stores. Traditional incandescent fixtures are inexpensive and are simple to relamp

LIGHTS Halogen

PURPOSE Display merchandise

IMAGE

Quantity 55

Chandelier

Prop

Lamp

Table light

14

CFL (compact fluorescent lamp)

Trial room

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Spot lights

Display window

10

Walls and flooring

The flooring used in the store is cocoa brown hardwood flooring with Dura-luster plus urethane finishing. Walls - POP (plaster of paris) in solid gray color. Tables: Brown gloss laminate top and polished chrome frame

INTERIORS Mirrors Inside store signage Sofa Sofa stool Cash counter

QUANTITY 8 3 1 2 1

PURPOSE Trial rooms and as a prop Cash counter and Trial room Inside Trial room Inside Trial room For billing

BUDGET In-store interior expenses, inclusive of lighting, fixtures, props is Rs.2, 50,000

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INTERIOR SIGNAGE Stainless Steel signage Stainless Steel Letters Signage and Stainless Steel Numbers Signage are suitable for interior stainless steel signage. It will provide the store with a stylish and elegant look. Natural satin and polished finish, showing precisely where to drill your mounting holes. 2 boards for the trial room and cash counter of 3ft*1ft of Rs.500 per sq ft. Therefore, costing = Rs.3000 Neon Signage One 3ft*1ft board at the cash counter of Ala mode in neon lit letters. Costing= Rs.2400 (Rs.800 per sq ft)

EXTERIOR SIGNAGE BOARD Black ACP board with Ala mode letters engraved on the board with studs. 3D ACP Backlit Board with Solid Acrylic Letters for exterior acrylic signage. ACP Acrylic Letters Signage is laser cut with polished edges to provide a finished look. ACP Acrylic Letters Signs will be installed with studs, wall, ACP Sheet and an installation pattern, showing precisely where to drill holes for mounting. Costing- Rs.600 per sq ft ALA MODE will have 3 exterior signage boards. One board of 3ft*5ft for the entrance and two of 3ft*10ft for the windows. 68

Therefore, costing = Rs.45, 000 Total Signage board costing for the store = Rs.50,400

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CHAPTER 12 PROMOTIONS

Promotion includes all activities designed to inform, persuade and influence people 70

when they are making the decision to buy. It is all about communication, because promotion is the way in a business that makes its products known to the customers, both current and potential. The main aim of promotion is to ensure that customers are aware of the existence and positioning of products. Promotion is also used to persuade customers that the product is better than competing products and to remind customers about why they may want to buy. In fact, promotion has many potential uses in business. It can be used to: Increase sales Attract new customers Encourage customer loyalty Create awareness Remind potential customers Reassure new customers

It is important to understand that a business can use more than one method of promotion. The variety of promotional methods used is referred to as the promotional mix.

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Using respective promotional method depends on below factors: Stage in the life cycle Nature of the product Competition Marketing budget Marketing Strategy Target Market How much information do the customers require before they buy? What are rivals doing? How much can the firm afford? Other elements of the mix (price, product, place etc.) Appropriate ways to reach the target market E.g. Advertising is important at the launch stage

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http://tutor2u.net/business/marketing/promotion_mix.asp

ALA MODE PROMOTIONS STRATEGY

1. SALES PROMOTION

Media and non-media marketing communication are employed for a pre-determined, limited time to increase consumer demand, stimulate market demand or improve product availability. Examples: Coupons, sweepstakes, contests, product samples,

rebates, tie-ins, self-liquidating premiums, trade shows, trade-ins, and exhibitions.

Ala mode has come up with two schemes under sales promotion, for the spring season that are: Freebies: The Free Panty coupon is one of the way that ala mode has chosen to 73

promote itself. Ala mode can send such coupons every month to all its customers, to get them moving inside the store. The best thing about this coupon is that there is no purchase necessary. Many times when stores give out coupons to receive free items, it is required that you buy something first. However, people will love this particular offer because they can receive a free panty just by walking into the store and handing over the coupon.

How will it help Ala mode?

Giving away a free item gives customers a reason to go into the store. There arent too many people who will just go in the store, get their free item, and then walk out. Every time a customer enter in to claim the prize, they always end up stopping to look around at everything else and usually end up buying something or the other. Exclusive, Limited-Time Coupons: Another one of the technique is to send coupons for 10% off any green purchase. In this situation, customers would receive 10% off on any item that is in color green bought from the store.

How does this help Victorias Secret?

They may provide 10% off, but theyre getting customers to spend money there. Again, the incentive gets customers through the door and the sought-after merchandise urges them to stick around and do some more shopping.

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http://www.qualitylogoproducts.com/blog/4-victorias-secret-marketing-tricks/#ixzz2DRBntyOM

2. PACKAGING (BRANDING)

It is a channel-agnostic form of advertising that allows businesses and nonprofits to communicate straight to the customer, with advertising techniques such as mobile messaging, email, interactive consumer websites, online display ads, fliers, catalog distribution, promotional letters, and outdoor advertising. In this method, Ala Mode is promoting itself through the means of packaging materials like Visiting cards, Paper bags and Gift box and Gift-wraps. "A business card is an introduction to potential clients," "It's an opportunity to make an impression with every person that brand come in contact with."

Business Cards and packaging are one of the most inexpensive and versatile tools in the marketing arsenal.

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3. E-TAILING

E tailing or e-retailing refers to the selling of retail goods electronically over the Internet. It offers the consumers huge amounts of information in the form of web sites with useful links to similar sites that allows consumers to compare products by looking at individual items. The convenience of online shopping is unmatched indeed. A prestige VIP card has been designed especially for Valentines Day, for the customers who shops for more than Rs.7, 000 on the day. The prestige card will offer a good percentage of discounts on after sales.

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4. ADVERTISING

Presentation and promotion of ideas, goods, or services by an identified sponsor. Examples: Print ads, radio, television, billboard, direct mail, brochures and catalogs, signs, in-store displays, posters, motion pictures, Web pages, banner ads, and emails. (Always in Paid Form non personal). Ala Mode is advertising itself through magazines by giving print ads so as to reach potential buyers and create an image of the brand. Concept of the poster: Keep calm and carry on was a propaganda poster produced by the British government in 1939 during the beginning of the second world war, intended to raise the morale of the British public in the event of a Nazi invasion of the U.K. The poster was rediscovered in 2000 and has been reissued by a number of private companies and used as the decorative theme for a range of products. And currently, the line being so familiar with the youngsters has been thereby used in our poster to promote brand among our customer group.

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5. DIRECT MARKETING

It is a promotional method in which one party (e.g., salesperson) uses skills and techniques for building personal relationships with another party (e.g., those involved in a purchase decision) that results in both parties obtaining value. This promotional method often occurs through telephone conversation, though newer technologies allow contact to take place over the Internet including using video conferencing or text messaging (e.g., online chat). Ala Mode plans to promote its end of season sales via multimedia message to its customer so as to get in the maximum footfall at the end of a season.

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BUDGET FOR PROMOTIONS, SPRING SUMMER2013

Total budget for promotions= Rs.939240

PROMOTION Advertisement Sales promotion Packaging E-tailing Direct Marketing COST Rs.7, 00,000 Rs.89240 Rs.75, 000 Rs.50, 000 Rs.25, 000 TIME PERIOD JAN MAR and MAY THROUGH OUT FEB JUN

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CONCLUSION

After working on the integrated project of store launch, we conclude that our decision to open up a lingerie store in West Delhi has been justified with the trade area analysis, market area analysis and site selection interview conducted by us which further helped us in selecting an appropriate site in Pacific Mall, Subhash Nagar. The next step was to decide on our product range and with this we studied our competitors as well in order to know how different are we going to be in terms of branding, service, quality and other factors. In the process of branding, we decided on our store name which came out to be A LA MODE and decided to target the segment of super-premiuim. Along with this we did brand personification to develop its identity. In store design we finalised our layout on an appropriate scale after studying the case studies and layout of our competitors. Along with this we planned to give a contemporary image to our store with a very cosy and alluring ambience and a simple but pleasing environmental display. As soon as we were done with the layout, we proceeded towards finalising the materials of the interiors and fixtures and their costing. Our next step was to work on the merchandise i.e. how much units we need to stock, planning reductions, allocation of average stock and lot more and for this we made a six month merchandise plan with the help of benchmark figures confirmed from our source. We have also made a vendor resource file and studied their terms and condition. In the end we worked on the operations and financial part i.e. budgeting. We worked on the sales budget by taking a benchmark figure of our competitors SPF, product cost, initial investments, employee cost, overheads and break even. With this we prepared the income statement and calculated the profitability ratio. Overall this project is a complete guide to make a brand launch plan.this project was a distant reality & fulffilled the gap between the semesters.

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http://en.wikipedia.orghttp:// http://www.slideshare.net/arunspeaker/retail-scope(extra) http://www.iimahd.ernet.in/publications/data/2007-03-04_PKSinha.pdf http://www.indianmba.com/Faculty_Column/FC1087/fc1087.html http://vmsd.com/content/convenience-store-trends?page=0%2C1 http://www.japan-guide.com/e/e2071.html http://www.freeonlineresearchpapers.com/leveraging-retail-formats http://www.ehow.com/list_6679006_types-retail-formats-india.html http://www.retailwire.com/Downloads/RetailFormats_ExecSum.pdf http://www.hoovers.com/free//ind/fr/profile/basic.xhtml?ID=382 http://clubmarkup.com/downloads/markezine_Oct06.pdf http://ccsindia.org/ccsindia/interns2003/chap17.pdf http://content.spencerstuart.com/sswebsite/pdf/lib/India_ConsumerRoundtable_web. pdf http://www.nacsonline.com/NACS/NEWS/FACTSHEETS/Pages/default.aspx

http://www.forbes.com/global/2009/0511/052-charles-keith-shoes-world-at-theirfeet.html. http://www3.moe.edu.sg/corporate/contactonline/2007/issue19/sub_professionalMat ters_art01.html

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