Clothing Retail Store Business Plan

Sample
BY LEGAL TEMPLATES FEBRUARY 4, 2016 BUSINESS PLAN SAMPLES

Executive Summary
SUMMARY

Style Villain is a Mt. Pleasant, South Carolina based clothes retail

business located in the Town Center on Highway 17 North. Style Villain
will focus on marketing medium to high end articles of clothing targeted
at college students and young professionals.
Style Villain aims to market
clothing that is more mature
than A&F or American Eagle, but
remains a ordable to young
professionals and college
students, while retaining a
young vibe.

MANAGEMENT TEAM
ANDREA WATSON:
CEO/GENERAL MANAGER

Andrea Watsonis a professional

designer and entrepreneur originally hailing from Baltimore, MD. She

has over 15 years of experience designing for major brands such as

Uniqlo, Gap, and Fruit of the Loom. Ms. Watsons intends to leverage her
successful career and numerous industry contacts to strike out and
create her own clothing brand.

PRODUCTS AND SERVICES

Style Villain will market all types of clothing for both men and women,
including casual, semi-casual, and professional out ts. The company
will also sell hats, belts, scarves, and jewelry, all of which will
complement each other to sell complete out ts. Style Villain will aim to
create trendy, fashionable clothing and accessories with a youthful
edge.

CUSTOMERS

Style Villains main customers will be teenagers, college students, and

young professionals, estimated between age 18-35. Our products will be
priced appropriately to be a ordable for people within this age group.
We anticipate that our target customers will on the whole possess less
disposable cash than customers outside of our target age range.

MARKETING AND SALES

Marketing for Style Villain will be done through signage, yers, coupons,
direct mail, billboards, strategic business relationships, Internet and
social media. Each marketing aspect will require a cohesive strategy that
is mutually reinforcing to get the most bene t. A more detailed strategy
can be viewed in the Marketing and Sales chapter of this business plan.

FINANCIAL FORECAST ANDREQUIRED FUNDS

The company anticipates earning $160,600 in net pro ts by the end of

year three. In order to remain cash solvent during the rst year of

startup, the company will require $75,000 to cover the costs of salaries,
an initial marketing blitz, and other incidental costs. Ms. Watson will
provide $30,000 of her own money, and take a $45,000 loan from the
Bank of America to satisfy startup cost needs.
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Company and Financing

COMPANY OVERVIEW

Style Villain is based and incorporated in South Carolina. The

business was formed on August 1, 2014, and serves the local market
of the town of Mt. Pleasant. The company expects to attain
signi cant market share of college age students and young
professionals looking to appear fresh and stylish.

MANAGEMENT TEAM
ANDREA DAWSON: CEO/GENERAL MANAGER

(https://legaltemplates.net/wpcontent/uploads/2016/01/lawn-careentrepreneur-3.jpg)Andrea Dawsonhas more

than 15 years in the design industry and holds a
masters in fashion management. Beginning as
a low-level designer and seamstress, she quickly
rose in the ranks of companies such as Uniqlo
and Fruit of the Loom due to her eye for contemporary fashion and
strong product development instincts. Eventually, after serving on

the board of SomaDesign Co., she decided to strike out on her own
and form her own brand.
Ms. Dawsonbrings over a decade of experiences and deep industry
contacts to the table, which willhelp lubricate the otherwise tedious
processes of starting a clothing company.

REQUIRED FUNDS

Style Villain will require $75,000 in startup costs to remain solvent

over the rst year. Low pro t margins, sta ng requirements, and an
initial advertising blitz will consume the rst years pro ts and
require a bank loan of $45,000 for the company to remain cash ow
positive. Ms. Dawsonwill supply the other $30,000 in initial startup
funds. By the second year, pro ts will exceed spending. By the third
year, the bank loan will be paid o entirely.

MISSION STATEMENT

Style Villain will provide young professionals a striking alternative to

the usual chain brands, while remaining a ordable and fashionable.
Easy, casual, fun.

COMPANY HISTORY

Style Villain was conceived by Ms. Dawson in 2013 while she served
on the board of Soma Design Co. Ms. Dawsonrecognized that there
was a market opening for edgier design as big brand clothing
retailers continued a trend towards homogeneousness.

LOCATIONS AND FACILITIES

Style Villain will be located on 1210 Belk Drive in the Mt. Pleasant
Towne Center. A map of the Towne Center facility is shown below:

(https://legaltemplates.net/wp-content/uploads/2016/01/TowneCenter-Map.png)
Style Villain is located on the heavily tra cked path to the movie theater.

Products and Services

PRODUCTS AND SERVICES

(https://legaltemplates.net/wp-content/uploads/2016/01/ClothingRetail-Storefront.jpg)
The Style Villain storefront


Style Villain will feature a diverse range of clothing that adhere to a
professional, modern style. Included below is a full list of our
featured items:

Armwear
Belts
Coats
Dresses
Gowns
Headgear
Jackets
Shirts
T-Shirts

Collared shirts
Dress shirts
Skirts
Tops
Trousers and shorts

SOURCING AND FULFILLMENT

For manufacturing, Style Villain will be working with Solomon Rose

Co., a clothing manufacturer based inSouth Carolina. Fabrics will be
sourced from Carolina Cotton Works. Ms. Dawson has negotiated
excellent terms with both companies, using her contacts within the
fashion and design industry. Despite the higher base costs, Ms.
Dawson insists on using US based manufacturers for three major
reasons. First, overseas manufacturers often create poor quality
products, and are di cult to communicate with. Secondly, overseas
manufacturers are also gaining a bad reputation amongst
sociallyconscientious millennials, Style Villains target customers.
Thirdly, overseas manufacturers require a large quantity of orders,
which a small boutique like Style Villain does not require.
COMPETITORS

COMPETITORS

The clothing retail industry is ercely competitive, and Style Villains

location in the Towne Center is a high-competition location itself.
However, the Towne Center also brings in a high volume of
customers daily, which helps to nullify the adverse e ects of a
competitive market location.
Within the Towne Center, our main competitors will be Belk,
American Eagle, Abercrombie & Fitch, Amelias, and Gap. The
companies target a similar range of customers, mostly overlapping
around millennials, generation X, and teenagers. Style Villain will be
aiming for millennial customers looking to wear stylish, high quality
clothing that isnt brand name or mass marketed.

INTELLECTUAL PROPERTY

Any and all designs created by Ms. Dawson or others for Style Villain
will immediately be under copyright. Style Villain will aggressively
pursue copyright infringers within the full extent of the law.

FUTURE PRODUCTS AND SERVICES

Ms. Dawsonhopes to open a sister shop in Savannah, GA if Style

Villain is successful in Mt. Pleasant.

Customers and Market Analysis

MARKET OVERVIEW

Clothing retail in Mt. Pleasant, SC follows similar trends in a uent

cities across the United States. The average yearly salary of a Mt.
Pleasant resident is $52,000 per year, and cost of living in lower than

in most parts of the country. This means thatMt. Pleasant residents

have a higher than average amount expendable income.

(https://legaltemplates.net/wp-content/uploads/2016/01/ClothingRetail-Cashier.jpg)
Associates at the company will be knowledgable and friendly.

The improving economy is also improving consumer con dence

across the United States. Taking a narrower view, Mt. Pleasant itself
experiencing an economic boom due to Googles server warehouse
and Boeings factory expansion into the Mt. Pleasant suburbs.

MARKET NEEDS

Mt. Pleasant is experiencing an in ux of a uent families hailing

from the north. Business across Mt. Pleasant and Charleston are
beginning to boom and expand due to the in ux of new money.
There is a market need for new clothing retail shops to meet the
demand of new customers.
In addition, the clothing tastes and trends in the south are di erent
from the north. Style Villain will move away from classic southern

styles like khakis and polo shirts and target an edgier, less traditional
niche. Ms. Dawsons designs aim to fuse southern and northern
sensibilities, while keeping a high quality, classy aesthetic.

MARKET TRENDS

Omnichannel retailing is quickly becoming the norm for smaller

retailers who are looking to edge out bigger companies with stronger
brands. Omnichannel marketing allows for the customer to
complete transactions in any way that they want to for instance,
they can order clothing online, and return it to the store physically.
Style Villain will work to make the purchase and return process as
streamlined and e cient as possible for customers.
Style Villain will also accept payments through mobile wallets to
facilitate business, save money on transactions, and keep up with
millennial trends.

MARKET GROWTH

Mt. Pleasant and Charleston area businesses are set to expand

rapidly as a uent families move from the north. Not only is Mt.
Pleasant growing due to Google and Boeings expansion into the
area, but also because it is consistently being voted the number one
city in the US (http://www.cntraveler.com/stories/2013-1015/charleston-south-carolina-number-one-city-in-the-united-states)
(for the third consecutive year.) Charleston is o cially on the map
for retirees, college students, and people looking for a change of
pace in their lifestyles.
Style Villain will be set to capture this growing market on its upswing,
and make a name for itself as a provider of quality, stylish garments.

KEY CUSTOMERS

Key customers for Style Villain will be college students and young
professionals, age ranging from 18-35. These customers will either
hail from a uent families or themselves have decent salaries and
expendable income. Market research suggests that millennials in this
age group in the Mt. Pleasant area are looking for new, unique
clothing options from the usual fare. Ms. Dawson will aim to provide
this valuable market segment with interesting designs that match
their budding personalities and ambitions.

Marketing and Sales

OVERVIEW

Marketing for Style Villain will be conducted across all channels.

Signage, newspaper, yers, brochures, online, social media, word-ofmouth, strategic alliances, and coupon strategies will all be used in
tandem to market the companys products.

POSITIONING

Style Villain will be competing with several large clothing retail stores
with strong brands, as well as boutiques. The company will aim to
compete indirectly with these other companies by carving out
auniqueniche for itself. Ms. Dawson recognizes an opening in the
market to target youth and young professionals looking for a unique,
stylish, and classy look that breaks away from the traditionally
southern styles that have dominated Charleston for decades. Market
research done by the company has revealed that Mt. Pleasant is
ready for Ms. Dawsons design vision people are ready to try new
styles and are excited by the prospect of purchasing products from
Style Villain.

PRICING

PRICING

Pricing for Style Villain will be higher than average for shops
overlapping within the same niche.
There are three major
reasons for the increased
price:

Concept Made in America tag

The raw materialsare

being sourced and the
products are being
manufactured in the
USA
The raw materials and
labor are ethical and
green
The quality of the
companys products is
higher and more
durable than that of
our competition

Despite these three added costs, Style Villains prices will still be
extremely competitive, measuring tens of dollars higher than
companies overlapping within our niche. Ms. Dawson believes that
millennials will be willing to buy a higher quality, ethical product for
a little more money.

PROMOTION

Promotion of Style Villains goods will be a kitchen sink strategy.

The company will advertise across all channels, including old media
and new media.
Advertising will be organized and cohesive across allmedia channels

(https://legaltemplates.net/wp-

content/uploads/2016/01/coupon-sales-strategy-284x300.jpg)
Coupons will be used to increase brand recognition.

to ensure maximum exposure, participation, and sharing amongst

Charleston/Mt. Pleasant residents. Initial marketing tactics will be
heavily coupon and sale based to draw in customers.
Customers in the store will be able to earn further sales by checking
in, liking the store page, or sharing the store with friends over any
form of social media. Billboard signage will be purchased for a
month during the initial startup phase, and coupon yers will be
mailed out to The Brickyard and Dunes West communities to draw in
initial customers and create a client base.

DISTRIBUTION

The companys products will be distributed from the retail location in

the Towne Center, and will deliver to areas within the southeast. The
company has plans to expand its delivery service to the entireUnited
States within three years.

Strategy and Implementation

MILESTONES

Year 1, Month 1:Website Set Up

Year 2, Month 6: Delivery to entire continental USA
Year 3, Month 6: Expansion of sister store to Savannah, GA

SWOT ANALYSIS
STRENGTHS

1. Company is eco-friendly and labor friendly

Style Villain has several strong points that make it a competitive
player in the retail clothing boutique niche. First, its an ethical
company, both in terms of environmental impact and human rights.

(https://legaltemplates.net/wp-content/uploads/2016/01/ClothingRetail-Designer.jpg)
Ms. Dawson is an award winning designer.

The companys partner manufacturers are based in the United States,

and materials are being sourced from US based growers within the
southeast. The companys carbon footprint is small, and its entire
growing and manufacturing process is labor friendly.
2. CEO is well connected and experienced
Ms. Dawson brings over a decade of experience in clothing design,
retail, and marketing for major brands. She brings with her an
award-winning clothing design sense, and contacts within the
industry. Due to her contacts, she was able to negotiate favorable
terms with the manufacturers, allowing her to keep prices
competitive despite the extra costs of US labor and materials
sourcing.
WEAKNESSES

Despite the favorable terms negotiated by Ms. Dawson with the

companys partner manufacturers, prices will nonetheless be higher
than our direct and indirect competitors. However, according to
market research, our target market is willing to spend more money
on high quality items that are eco-friendly and labor friendly. Style
Villains higher prices will be couched in heavy marketing, ensuring
customers are aware that they are purchasing a product that aligns
with their value systems.
OPPORTUNITIES

Ms. Dawson sees an opportunity to expand Style Villain into

Savannah, GA, provided the store is successful in Mt. Pleasant, as
these two cities share a similar aesthetic and appeal.
THREATS

Mt. Pleasants rapid expansion means that there are several other
entrepreneurs who will also be opening boutique clothing shops.
Ms. Dawsons contacts in the industry and familiarity with the
business will allow her to navigate the complications of running a
retail business, giving her an edge amongst her new competitors.

SALES FORECAST
SALES FORECAST TABLE
Year 1 Year 2
Year 3
Unit Sales

Clothes
29,139 43,164
58,308
Belts, Hats, Scarves 8,321
12,324
16,656
Jewelry
707
1,056
1,428
Price Per Unit

Clothes
$20
$20
$20
Belts, Hats, Scarves $15
$15
$15
Jewelry
$35
$35
$35
Sales

Clothes
$582,780$863,280 $1,166,160
Belts, Hats, Scarves $124,815$184,860 $249,840
Jewelry
$24,745 $36,960 $49,980
Total Sales
$732,340$1,085,100$1,465,980
Direct Cost Per Unit
Clothes
$16
$16
$16
Belts, Hats, Scarves $12
$12
$12
Jewelry
$17
$17
$17
Direct Cost

Clothes
$466,224$690,624 $932,928
Belts, Hats, Scarves $99,852 $147,888 $199,872
Jewelry
$12,372 $18,480 $24,990
Total Direct Cost $578,448$856,992 $1,157,790
Gross Pro t
$153,891$228,108 $308,190
Gross Pro t %
21%
21%
21%
SALES BY MONTH

Financial Plan

SALES BY MONTH

(https://legaltemplates.net/wp-content/uploads/2016/01/ClothingPlan-Sales-by-Month.jpg)

PERSONNEL PLAN
PERSONNEL TABLE
Year 1 Year 2 Year 3
Sales Associate$25,000$26,250$27,500
Store Manager $40,000$42,000$44,000
Total
$65,000$68,250$71,500
BUDGET
BUDGET TABLE

Expenses
Salary
Employee Related Expenses
Rent
Advertising and Promotion
Advertising Blitz
Insurance
Point of Sale System
Business Expenses
Accountant
Total Expenses
Long-term Assets
Total Long-term Assets
Other Current Assets

Year 1 Year 2 Year 3

$65,000 $68,250 $71,500

$9,750 $10,237 $10,725
$18,000 $18,000 $18,000
$14,646 $21,702 $29,319
$4,000 $0
$0
$6,600 $6,600 $6,600
$1,000 $0
$0
$2,400 $2,400 $2,400
$1,600 $0
$0
$122,996$127,189$138,544

$0
$0
$0

Total Other Current Assets

$0
Dividends and Distributions

Total Dividends and Distributions$0

EXPENSES BY MONTH

$0

$0

$0

$0

(https://legaltemplates.net/wp-content/uploads/2016/01/ClothingRetail-Expenses-by-Month.jpg)

CASH FLOW ASSUMPTIONS

CASH FLOW ASSUMPTIONS TABLE
Cash In ow
% of Sales on Credit

80%
30 days

90 %
30 days

Cash Out ow
% of Purchases on Credit
Avg Payment Period (Days)
Inventory
Months to Keep on Hand
Minimum Inventory Purchase
LOANS AND INVESTMENTS

LOANS AND INVESTMENTS TABLE

Year 1 Year 2Year 3
Andrea Watson
$30,000$0
$0
Bank of America Loan $45,000$0
$0
Total Amount Received$75,000$0
$0
STARTING BALANCES
Sales

Sales Last Month

$0
Sales 2 Months Ago
$0
Sales 3 Months Ago
$0
Sales 4 Months Ago
$0
Sales 5 Months Ago
$0
Sales 6 Months Ago
$0
Assets

Cash
$0
Accounts Receivable
$0
Inventory
$0
Other Current Assets
$0
Long-Term Assets
$0
Accumulated Depreciation$0
Liabilities

Accounts Payable
$0
Sales Taxes Payable
$0
Capital

Paid-in Capital
$0
Retained Earnings
$0

PROFIT AND LOSS STATEMENT TABLE

Year 1 Year 2
Year 3
Revenue
$732,340$1,085,100$1,465,980
Direct Cost
$578,448$856,992 $1,157,790
Gross Pro t
$153,891$228,108 $308,190
Gross Pro t %
21%
21%
21%
Operating Expenses

Salary
$65,000 $68,250 $71,500
Employee Related Expenses
$9,750 $10,237 $10,725
Rent Expense
$18,000 $18,000 $18,000
Advertising and Promotion
$18,646 $21,702 $29,319
Insurance Expense
$6,600 $6,600
$6,600
Computer and Internet Expenses
$1,000 $0
$0
Miscellaneous
$2,400 $2,400
$2,400
Professional Fees
$1,600 $0
$0
Expensed Portion of Other Current Assets$0
$0
$0

Financial Statements

Depreciation and Amortization

Total Operating Expenses
Operating Income
Other Expenses (& Other Income)
Loss (or Gain) on Sale of Asset
Interest Expense
Total Other Expenses (& Other Income)
Income Before Income Tax
Income Taxes
Net Income
Net Income / Sales
GROSS MARGIN BY YEAR

$0
$0
$122,996$127,189
$30,894 $100,918

$0
$0
$2,155 $1,520
$2,155 $1,520
$28,739 $99,398
$1,436 $4,969
$27,302 $94,428
4%
9%

$0
$138,544
$169,645
$0
$600
$600
$169,044
$8,452
$160,592
11%

(https://legaltemplates.net/wp-content/uploads/2016/01/ClothingPlan-Gross-Margin-by-Year.jpg)
NET PROFIT (OR LOSS) BY YEAR

(https://legaltemplates.net/wp-content/uploads/2016/01/ClothingPlan-Gross-Pro t-Year.jpg)

BALANCE SHEET TABLE

As of Periods End
Starting BalancesYear 1 Year 2 Year 3
Cash
$0
$14,333 $86,931 $206,304
Accounts Receivable
$0
$67,924 $72,340 $97,732
Inventory
$0
$71,416 $96,482 $96,482
Other Current Assets
$0
$0
$0
$0
Total Current Assets
$0
$153,673$255,753$400,519
Long-Term Assets
$0
$0
$0
$0
Accumulated Depreciation
$0
$0
$0
$0
Total Long Term Assets
$0
$0
$0
$0
TOTAL ASSETS
$0
$153,673$255,753$400,519
Accounts Payable
$0
$64,274 $86,834 $86,834
Sales Taxes Payable
$0
$0
$0
$0
Short-Term Debt
$0
$0
$0
$0
Total Current Liabilities
$0
$64,274 $86,834 $86,834
Long-Term Debt
$0
$32,096 $17,189 $1,362
TOTAL LIABILITIES
$0
$96,371 $104,023$88,196
Paid-in Capital
$0
$30,000 $30,000 $30,000
Retained Earnings
$0
$0
$27,302 $121,730
Pro t and Loss Current Period$0
$27,302 $94,428 $160,592
TOTAL OWNERS EQUITY
$0
$57,302 $151,730$312,322
TOTAL LIABILITIES & EQUITY $0
$153,673$255,753$400,519
CASH FLOW STATEMENT TABLE
Year 1 Year 2 Year 3
OPERATING ACTIVITIES

Net Income
$27,302 $94,428 $160,592
Depreciation and Amortization
$0
$0
$0
Gain or Loss on Disposal of Asset
$0
$0
$0
Change in Accounts Receivable
$(67,924)$(4,416) $(25,392)
Change in Inventory
$(71,416)$(25,066)$0
Change in Accounts Payable
$64,274 $22,559 $0
Change in Sales Taxes Payable
$0
$0
$0
Change in Other Current Assets
$0
$0
$0
Net Cash from Operating Activities
$(47,763)$87,505 $135,200
INVESTING & FINANCING ACTIVITIES

Long-Term Assets Purchased or Sold

$0
$0
$0
Investments and Contributions Received$30,000 $0
$0
Change in Short-Term Debt
$0
$0
$0
Change in Long-Term Debt
$32,096 $(14,907)$(15,827)
Dividends and Distributions
$0
$0
$0
Net Cash from Investing & Financing
$62,096 $(14,907)$(15,827)

Cash at Beginning of Period

Net Change in Cash
Cash at End of Period
CASH FLOW BY MONTH

$0
$14,333 $86,931
$14,333 $72,598 $119,373
$14,333 $86,931 $206,304

(https://legaltemplates.net/wp-content/uploads/2016/01/ClothingCash-Flow-Month.jpg)
CASH FLOW BY YEAR

(https://legaltemplates.net/wp-content/uploads/2016/01/ClothingPlan-Cash-Flow-Year.jpg)

FINANCIAL RATIO TABLE

As of Periods End
Liquidity Analysis
Net working capital
Current ratio
Quick ratio

Projected
Year 1 Year 2 Year 3

$89,399$168,920$313,685
239% 295%
461%
128% 183%
350%


Pro tability Analysis

Gross pro t margin

21%
Operating pro t margin4%
Net pro t margin
4%

Debt Ratios

Debt to assets
63%
Debt to equity
168%

Investment Measures
ROI
18%

21%
9%
9%

21%
12%
11%

41%
69%

22%
28%

37%

40%
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