Business Plan for London Rags Fashion Store: A Comprehensive Analysis

The business plan for London Rags fashion store outlines the key aspects of establishing a new retail business in the fashion industry. It begins with an executive summary and details the business concept, including the target market (women), unique selling propositions (urban wear), and marketing strategies. The plan includes a comprehensive market research section, analyzing current fashion trends and customer profiling. It assesses the competitive landscape using SWOT analysis and addresses pricing, staffing, and premises. Financial projections, including a profit and loss forecast and break-even analysis, are also provided. The plan emphasizes the importance of customer service, brand image, and special events to drive sales and achieve business goals, such as creating brand awareness, enhancing sales, and customer retention. The plan also provides the information regarding the key personnel for the firm.

Business plan
1

Table of Contents
1. Executive summary............................................................................................................3
2 Business details...................................................................................................................3
3 Key personnel......................................................................................................................4
4 The business idea.................................................................................................................4
5 Business goals.....................................................................................................................5
6 What makes the business different......................................................................................6
7 Market research...................................................................................................................7
8 Profiling customers..............................................................................................................8
9 Profiling competitors (For example SWOT).......................................................................8
10 Managing market risks....................................................................................................10
11 Pricing..............................................................................................................................10
12 Staff.................................................................................................................................11
13 Premises...........................................................................................................................12
14 Profit and loss forecast....................................................................................................12
15 Sourcing finance..............................................................................................................15
2

Reference.......................................................................................................................................18
3

1. Executive summary
London rags fashion store is new apparel store which provides unique products services to their customers. The focus of the
firm is to target a large number of customers especially women’s. In order to grab the attention of customers company will focus on
advertising products and services. All the legal laws and regulation will be followed which are compiled by the government. One of
the core business strategies is to combine exceptional and knowledgeable customer service with quality stylish merchandise. In current
trends Urban wear has enhanced in popularity, therefore the cited firm will provide a unique product of which are mostly attract the
women’s. Further large marketing budget is known as the key to establishing a well-known fashion brand. London rags fashion
company is start-up company and there are many competitors in the market who sell similar products. The company can focus on
various marketing strategies in order to enhance sales and profits.
2 Business details
Name of the business will be “London rags fashion store. This name is selected to identify the store with the city of London,
England where most of the store ‘inventory will be purchased. It is the upscale women clothing boutique which intends to provide
fashionable products to customers. The business operates within the retail industry with the aim of accomplishing success. The store
will be open near the mall the and it will contain two dressing room. Along with this parking facility will be available in front of the
store with additional spaces (Swamidass, 2016).
One of the primary goals of the firm is to deliver the quality product so that the come back to make the purchase again and again. It
is known as sole proprietor firm which is formally organised in London. All the legal laws and regulation will be followed which are
compiled by the government. The firm is established as a sole proprietorship which makes easier the formation and simplicity of the
tax record keeping and its structure.
The organisation will market women’s clothing which includes semi-casual, professional outfits, casual. Along with this firm will
also sales scarves, belt, and hats as because this all will complement each other to make a complete outfit. The aim of London rags
4

fashion store is to develop fashionable, trendy clothing, and accessories with useful younger age people (Burns, Mulle and Bryant,
2016).
3 Key personnel
London rags fashion store is a new company so in management team there will be 4 to 6 members. When the first store will be
established then more shops will be open in town. Main responsibility will be of manager to track sales and profit of the firm. The firm
understands the impact of recruiting and managing staff member will have on the firm success (Zimmerer, Scarborough and Wilson,
2005). Due to this reason, proper time will be taken to overseeing the store and those who are working directly in the store. Employees
which will be hired are as follows:
The sales clerk who will be prevention manager.
The customer service/ inventory control
The customer service/ inventory control manager will be
The store will open seven days a week. It will open in morning 10 A.M to evening 9 PM. On Sunday shop will be open for half day
between 10 A.M to 2 P.M. The company will hire two full-time employees.
4 The business idea
One of the core business strategies is to combine exceptional and knowledgeable customer service with quality stylish
merchandise. Based on the experience of working in retail company help in developing understanding related to the women’s
shopping behavior. London rags fashion store conducted research employed the following marketing strategies.
• To develop a strong relationship with customers through using style assessment and offering services to assist each woman to
determine the clothes according to her requirements.
• To provide educational materials and program for the customer so that they can make effective decisions.
• To build awareness among customers related to the new products which are offered by London rags fashion store.
• To utilise personal referrals and stylish for building traffic.
5

Products which will be offered to women’s will be of high quality so that it can easily grab their attention and encourages them for
repeated purchase. There are different sales strategies which can be adopted by the firm. With the intent of establishing a new
business, it is important to create a unique image of themselves (Carrier, Raymond and Eltaief, 2004).. It includes different style prints
and colors. In order to enhance sales and for promoting the firm special events will help which can help people. Some of the specific
events which can be held by the firm are anniversaries, celebrations, contests, fashion shows, festivals, trade shows etc. These all
special events help in boosting the sales and image of the firm. Advertising plays a significant role with respect to increase the profit
of the firm. There are various mediums available for this, but most of them are include social networking sites, Television, magazine.
To have a celebrity in front of campaign help in enhance sale of London rags fashion company (Finch, 2016).
5 Business goals
There are some specific goals of the firms which are as follows
 To create brand image in customer’s mind.
 To enhance sales and profit within a year
 To retain customers through providing unique products.
While establishing a business there are some set of goals which are required to accomplish at the time. In the first year of the
business, the goal is to settle a business with earning a profit. London rags fashion can sell its product at lower price. When the
company will be well established that it can focus expanding its business in next two years. Along with this firm can focus on selling a
wide range of product including men’s wear also (Maxwell, Foley and Marty, 2015). Hence in next two years firm can easily focus on
expanding its business and accomplish success. The peak time of retail business is a month of August till December in this time sales
is high. However, in the month of January, July and June sales remain lower. On the other side in rest of the month's sales remain
lower. Therefore, London rags fashion store can focus on a saturation of special events and sales. Along with this firm also organise
holidays special events for grabbing attention of customers.
6

BREAK EVEN ANALYSIS
Amount
(£)
Averagse selling Price 20
Variable Cost 8.09
Contribution 11.91
Total Fixed cost 45000
BEP (in units): Fixed cost /
contribution 3778
6 What makes the business different
The product and services which will be provided by London rags fashion store will be different from its competitors. In
current trends Urban wear has enhanced in popularity, therefore the cited firm will provide a unique product of which are mostly
attract the women’s. Further, the product of London Rags will be more than 32 pieces which will include, leather, denim, linen
bottoms and silk shirts etc. However, fashion trends change constantly and every season there are many fashions shows present
various designer idea. From there also new fashionable clothes idea can be considered for growth and success of the London rags
fashion store. The firm will focus on selling those products mostly which are in current trends. Along with this, frim can focus on
using special events that are fashion shows, festivals to grab the attention of customers and make aware them about new product
development. It helps in making aware of communities policies and goals and purposes (Skoog and Trosdahl, 2017). The top 10
apparel line on which firm can focus are Hocken, Catherine the great, Tosca. James Jeans, Goat, Herr Frau PF lines, Twelfth street,
Philosophy di Alberta Ferretti, Philosophy di Alberta Ferretti, Philosophy di Alberta Ferretti. Hence selling products with unique
concepts play a significant role with respect to enhance sales and profit. There are many competitors in the market who operates their
7

business in the retail industry for many years. Along with this they also have capture market shares due to which it is not easy for
London rags fashion company to carry out business and earn a profit. Hence, introducing unique concept will help in making a good
position in the market. Some of the labels which will be carried out by London rags fashion store are as follows:
Wrangler Lawman Jeans
Circle Y of Yoakum Silver Strike Buckles
Sunbody Hats Cowboy Hardware
Hat 'N' Hand 20X by Wrangler
Rouchrider of Circle T Urgent Gear
Western Ethics, Panhandle Slim
Rocky Mountains Cinch
7 Market research
Fashion retail sector is selected for the establishing a new business. This industry is selected because people mostly focus on
their way of living and outfit which they wear, regularly and occasionally. There are some current trends in the fashion industry which
are identified from previous job experience and through conducting research. There are some top trends which help in setting the
agenda for the global fashion industry that is as follows:
Getting personal: Personalisation and curation lead to becoming more essential for the customers. It is because customer values
combine around legitimacy and uniqueness, companies will value data even more to modify recommendation (Zukin, Rath and
Hagemans, 2015).
Platform first: At present customer mostly focuses on online platforms which is the first point of search. It leads to attract their
convenience, relevance and breadth of offering. The platform is growing and reach compelling fashion brands for identifying the way
of engaging more with these effective channels.
Mobile obsessed: A customers with fascination with mobile grows and all the transaction to with mobile. Mobile payment solution is
already available in the market. Further, London rags fashion store is also thinking to cater for enhancing suitable mobile transactions.
8

Hence through market research this all are the current trends which are analysed by London rags fashion store (Halkias, 2017).
8 Profiling customers
The company is selling product in fashion retail sector. The main customer group will be firm women’s who are working hard
for the firm. Women’s are more conscious for their way of dressing as compare to man. Therefore, demographic market segmentation
will be focused by London rags fashion store (McKeever, 2016). Further customer research was conducted which help in analysing
the requirements of customers. At present most of the customer focus on purchasing product which are latest in trends and are of good
quality (Kolb, 2015). There are some factors on the basis of which customers make decision where to shop that are as follows
 Treating customers with respect
 Handles merchandise returns fairly
 Makes it quick and easy to shop
 Can find according to their requirement
 Convenient store hours
Per year Per week
Women's Apparel $1100 $29.38
Accessories $636 $13.24
Girls' Apparel $265 $4.08
Babies $219 $5.20
9 Profiling competitors (For example SWOT)
Competitor Strength Weakness
Marks and spencer  Marks and spencer is
considered as one of
the top retail brand
Poor financial performance is
one of the weakness of the
9

which have top of the
mind recall.
 It perceives value of
money because of
quality of its product.
firm.
Due to frequent recalls leads
to loss in customer
confidence.
Zara One of the biggest strength of
Zara is lies in its design
abilities. The firm has plethora
of designers on board who
understand who understand
brand of Zara.
One of the weakness is that it
do not advertise its products
and services.
Next Plc Next Plc focus on creating
products which are different
from its competitors. Along
with this it use effective
pricing strategies to sale
products.
One of the weakness lack of
skilled employees due to
which Next plc face problem
After analysing the competitor’s strength and weakness, London rags fashion company can focus on selling products and services with
some unique concept. It can understand factors due to which company profit is getting affected. Such as hiring skilled employees can
help in improving quality of products and increase sales. Due to which it become easy for the firm can easily in
10

10 Managing market risks
Starting a new cloth store come-up with the benefits of exposing customers. There are some risks which can be faced by
London rags fashion store that are as follows:
Competitive risk: In clothing business branding is everything. Further large marketing budget is known as the key to establishing a
well-known fashion brand. London rags fashion company is start-up company and there are many competitors in the market who sale
similar products. Therefore, most of the people prefer to visit those retail store which highly advertise their products and services. For
the cited firm not only, the brand awareness can be issues but also large chains have the power to provide deep discounts. It is
essential for the company to advertise products and services in the market so that more and more people came to know about it. To
make a personal connection with customers through loyalty program help to mitigate the risk.
Inventory management: To operate fashion retail store it is important for the owner to keep a regular supply of clothing on hand. If
company fail to purchase enough inventory results in loss of customers and sales. On the other side, if the firm purchase too much
inventory then it incurs losses through selling excess clothes at discount price.
11 Pricing
Pricing strategy play significant role in respect to carry sales products and services. In order to sales products prices need to be set for
each products that are as follows:
Products Price
Leather jacket £ 1000
Jeans £ 1500
Long gown £ 2000
11

12 Staff
Roles and responsibility of staff members London rags fashion store can hire skilled employees in order to carry out its business
successfully.
Staff roles
Sales clerk Handle cashier work and loss prevention
Inventory control manager Handle customer services and inventory control
Salesman To advertise products and services
Personnel FY2001 FY2002 FY2003
Staff 1 $6,400 $6,400 $6,400
Staff 2 $6,400 $6,400 $6,400
Other $0 $0 $0
Total Payroll $12800 $12800 $12800
Total Headcount 0 0 0
Payroll Burden $1,800 $1,800 $1,800
Total Payroll Expenditures $14, 600 $14, 600 $14,600
All employees who are hired lead to perform the following roles and responsibility which are mentioned above.
13 Premises
Cost £
Premises required to start-up £1,000
Premises required in the future (if different): £ £1500
12