Entrepreneurial Finance Project: Jacquemus Paris Store Plan

This project presents a detailed financial plan for the launch of a Jacquemus store in Paris. It begins with an introduction to the brand and outlines the estimated budget of $54,59,000, with details on equity and debt funding. The project sets key financial objectives, including sales growth and COGS reduction, and outlines assumptions regarding sales, COGS, and loan repayments. A comprehensive marketing strategy is presented, focusing on high-quality products at competitive prices and customer satisfaction. The analysis includes startup costs, income statements, cash flow statements, and balance sheets, along with journal entries and a conclusion supporting the store's potential success based on projected financial performance. The project references several academic sources to support its analysis.

Entrepreneurial Finance
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Introduction
Jacquemus was started by Simon Porte
Jacquemus at the age of 19 with his own
label. The brand was credited with carrying
freshness to the fashion scene and he was
working in space among the conceptual and
commercial strategies. This presentation
will provide the plan for opening its new
store in Paris.

Evaluation of required budget for launch
Entire requirement for launching the
store are estimates to be $ 54,59,000
including the registration cost of $
21,09,000 and $ 33,50,000 for
purchasing the equipments. Out of total
requirements 60% of the amount that is
$ 32,75,400 will be funded through
equity and 40% of the amount that is $
21,83,600 will be funded through long
term debt.

Key financial objectives
The key objectives of opening the
Jacquemus store in Paris are –
 Enhancing the sales by 125% till 3rd
of the business
 Reducing the COGS by 2% at least
from 2nd year of launching the store
 Enhancing the number of the store’s
target customers.

Assumptions, revenue expectation and
margin calculation
While preparing the budget for next 3 years
income and expenses following assumptions
were made –
 Sales of the business will be enhanced by 12%
in the 2nd year of business and will further
enhance by 14% in the 3rd year of business.
 Sales in the month of September, October and
November will significantly fall due to winter and
people are unlikely to move from their houses to
visit the store for shopping.

 Due to Christmas, the sales in the month
of December will be enhanced.
 COGS will be 60% for the 1st year and for
next 2 years it will be reduced by 2% and
the COGS will be 58% of the sales.
 Loan repayments and interest on that
will be made quarterly.

Marketing strategy
The store’s marketing strategy is to deliver the
products with high quality with minimum
possible price. Further, it will sell products as
per the requirements of the customers and
satisfying the demand of the customers.
Further, the store will deliver the goods as per
the preferred time of the customers without ant
barrier or hurdle.

Retail industry and customers in Paris
Paris is the hottest retail market in the world
that attracts 50 new brands during last year
and France has been ranked as leading
nation for the new entrants. However, it has
stable, small and departmental sector of the
stores owing to the premium positioning of
the store players. The marketing initiatives
reflect the dependencies on international
customers as the fashion markets in Paris
are highly driven by the tourists.

The brand will adopt the following operational
strategies –
 Initially the company will offer 10% discount if
any customers shops for more than $ 2000.
 On important dates like 1st January and 25th
December it will offer flash sales that will offer
high discount to some selected products
 The customers will be able to customize their
order if the availability of products in the stores
does not match with the colours or sizes they
require.

Financial strategy
Start up costs

Income statement

It is assumed that the sales for the 2nd year
will increase by 12% and in 3rd year it will
increase by 14%. COGS for the 1st years will
be 60% of the sales and for 2nd as well as
3rd year it will be 58% of the sales. Hence,
the gross profit for the 1st year will be 40%
and for 2nd year as well as 3rd year it will be
42%. Further, net profit for the 1st year is
expected to be 3.53% whereas for 2nd year
it is expected to be 9.82% and for 3rd year it
is expected to be be 12.55%