Starting a Business: External Analysis for 'Finer Threads' in London

This report outlines a business plan for 'Finer Threads,' a new clothing shop in London specializing in trendy clothes for women and kids. It includes an evaluation of the external environment using PESTLE analysis, examining political, economic, social, technological, legal, and environmental factors affecting the business. A competitive analysis using Porter's Five Forces model identifies potential threats and opportunities. The report also defines the target market and positioning strategy, aiming to offer affordable, trendy clothing while incorporating recycling practices. The business intends to attract customers by building relationships and offering regular discounts.

Starting a Business
and Fundamentals of
Marketing

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Evaluation of the current external environment..........................................................................3
A discussion of the competition..................................................................................................4
Target Market..............................................................................................................................5
CONCLUSION................................................................................................................................6
REFERENCES:...............................................................................................................................7
Books and Journals.....................................................................................................................7

INTRODUCTION
Clothing industry is at boom and the new business is to start a new clothing shop “Finer
threads”. It will provide variety of clothes for women and kids. After completing the
management course and doing internship for 6 months in clothing store, the idea for business
plan is derived. The business will provide trendy clothes at low cost. The old clothes can be
resold to the business and will be recycled (Uprety, 2020). “Finer threads” will be located at
high street London, in order to attract more customers. In this report there is discussion related to
the current external environment so that business is able to function effectively. Along with that,
the competitiveness is also enhanced as it will help to formulate appropriate strategies. The target
market for the new business is also evaluated in the report.
MAIN BODY
Evaluation of the current external environment
It is important to check the external factors and their impact on the business organisation.
The use of PESTLE analysis will help to check the external environment and the macro
economic factors. Below is discussion related to the political, legal, economic, environmental,
social in relation to Finer Threads:
Political Factors: The political factors includes tariffs, taxation policy, political
condition of the nation. The political stability in UK provides good opportunities for new
business organisations to carry on the operation in effective manner (Darmawan, 2020). Finer
Threads will take care of the policies and will abide them so that they are able to carry on the
business smoothly.
Economic Factors: It includes interest rate, inflation rate, employment rate, demand
supply etc. It is analysed that Finer threads will provide employment to various individuals and
also contribute to GDP of the nation. There is high demand of clothing in the market of UK and
it will support Finer Threads to carry on the business effectively.
Social Factors: The preferences and needs of the society keep on changing. To satisfy
the needs and wants of customers, Finer Threads will provide trendy clothes so that they are able
to satisfy the customers. They will assure that latest and fashionable products are provided to the
customers.

Technological Factors: To use of latest technology helps the business organisation to
enhance the efficiency in operations (Paras and et.al., 2018). Finer Threads will use updated
technology in order to serve the needs and wants of the customers. Their online store is the
example of latest technology being used by the company.
Legal Factors: The laws and legislations must be followed by the business organisations
in fashion industry as well. Finer Threads has to follow taxation laws, labour laws, inflation cost,
and import and export restrictions.
Environmental Factors: There is need to take proper actions that are not harmful for the
environment. Finer threads works on the principle of recycling that helps them to take care of the
environment. The use of resources in effective manner will help the company to establish
effective brand image in market.
It is necessary to check the impact of all the external factors on the operations of new
business. Finer Threads will assure that all the laws related to opening of new business are being
followed by them. The business organisation will use latest technology so that they are able to
attract more customers.
A discussion of the competition
Competition is present in each and every level and the level of competitiveness is high in
fashion industry. There is need to monitor the competition in the industry and to carry on the
strategies to gain lead over them (Zebal and Jackson, 2019). The use of Porter Five forces model
will help the business organisation to gain edge over the competitors. The forces in regard to
Finer Threads are discussed below:
Threat of new entrants: There is high threat of new entrants in fashion industry. Finer
threads is also new business. They must focus on the quality of the product so that they are able
to set effective brand image in market.
Bargaining power of buyers: The aim of Finer Threads is to serve the needs and wants
of the customers. The business organisation will provide quality and trendy products at
affordable price. This will help them to retain the customers towards their organisation.
Bargaining power of suppliers: Their is moderate threat of suppliers. The company will
use quality raw material and maintain good relations with the suppliers. It assist them in
converting the raw materials into finished goods within right time.

Competition rivalry in the industry: There is high competition present in the fashion
industry (Heath, 2018). Finer threads have to face competition not only from small business
houses but from big clothing brands such as Zara, H&M. The company focus on their low cost
strategy in order to gain edge over the competitors.
Threat of substitutes: There are various players in the market that provide clothes. Finer
threads will work on providing quality and trendy clothes to the customers (Aprilliano, 2021). At
the same time the strategy of recycling will help to beat the competitors in the market.
The business organisation must work on setting effective image in the market. They must
give regular discounts and offers to the customers so that they able to attract them. By building
relations with customers, Finer threads will be able to attain edge over the competitors in market.
Target Market
 Segmentation: It is the process of dividing the overall population in small groups that
have similar characteristics (Stojanovikj, 2022). There are certain basis of segmentation
such as demographic, behavioural, psycholgraphic and geographic.
 Targeting: The process of selecting target group of customers is called targeting. The
target customers of Finer threads are women and kids. They will serve the customers of
London in the initial year of business.
 Positioning: The business wants to create image of providing trendy clothes to customers
at affordable price.

CONCLUSION
From the above business plan, it is concluded that the conducting research before starting
the business is important. The external environment scan is important part of this report. There is
evaluation of the competition in the industry so that suitable actions to take lead are analysed. In
the end, the target customers for the business are being examined.

REFERENCES:
Books and Journals
Aprilliano, Y.Y., 2021. AN ANALYSIS OF DESIGNERS’PERCEPTION OF USING
ENGLISH IN T-SHIRT DESIGN IN CLOTHING BUSINESS IN PONTIANAK.
ELSA, 2(1), pp.10-17.
Darmawan, T.A., 2020. Strategic planning of" Shibui Project" clothing line business (Doctoral
dissertation, Universitas Pelita Harapan).
Heath, J., 2018. But everyone else is doing it”: Competition and business self-regulation. Journal
of social philosophy, 49(4), pp.516-535.
Paras, M.K and et.al., 2018. An exploratory study of Swedish charities to develop a model for
the reuse-based clothing value chain. Sustainability, 10(4), p.1176.
Stojanovikj, M., 2022. Government size, inflation targeting and business cycle volatility.
Economic Analysis and Policy.
Uprety, P., 2020. Business plan: importing garment clothing from Nepal to Finland: Case study
of Himalayan Trade Fair.
Zebal, M.A. and Jackson, F.H., 2019. Cues for shaping purchase of local retail apparel clothing
brands in an emerging economy. International Journal of Retail & Distribution
Management.