Company Description
Target Clothing is a company operating in apparel business. The company sews trendy apparel for adolescents and young people. The company is going to launch a new line of apparel for sports, leisure, and active lifestyle. Target Clothing is developing creative models of clothing, offers innovative approach and new technologies to clothing. The company does not have physical shops; it sells its products through Internet.
Scenario & Assumptions
The new start-up is based in UK. It mainly operates worldwide in the internet space through its own website. Approximately £1 million of investment is required to launch a new line of trendy clothes for youth. The company operates in a highly competitive market environment.
Market Opportunity & Customer Base
The number of young people aged 16-24 accounted for 12% of total population of Great Britain and Wales as of 2013 making 7.4 million. The potential customers’ base is 5.6 million of the adolescents using internet, social media, and blogs supposed to be reached through these means of communication.
The dwellers of Great Britain are active users of social media. Usually, they use social media website for communication and exchange information. There are approximately 600,000 users of Facebook and 15 million users of Twitter in Great Britain. Also, 80% of the users of social media access this website using mobile phones.
Problem and Current Solution
Problem: there is a need to increase a base of customers because the enterprise is new and customers’ awareness is low. The Current Solution: by now, the company was advertised using newsletters. However, this approach to advertising and promotion outdated since many people delete newsletters from unknown senders.
Product and Services
Target Clothing offers casual apparel for sports, leisure, and active life of high quality. The target market is teenagers from 10 to 17 years. The secondary target market is young adults aged between 17 and 25.
The New Solution: The absolute majority of the potential customers use mobile phones and 80% of them use them to access internet. Thus, they can visit the website of the company and make orders in the real time. Also, the customers will be able to order custom clothes right on the website and participate in model creation. The new promotion campaign will be developed taking into account this new customers’ acquiring strategy.
Business Model & Key Revenue Streams
The e-commerce business model will be used to promote Target Clothing. This is the best business model for a new venture because it does not require much cost. Similar strategy is used by Louis Vuitton. This strategy helps corner marketplace. The company derives revenues from three sources: selling sport wear, leisure, and active lifestyle apparel. Also, the company offers a unique service: an opportunity to design clothes on its website.
Market Approach & Strategy
The company will benefit from the strategy of differentiation using individual approach to the customers. Young people are often willing to express them in an original way and our company will help them in it. Adolescents tend to care more about fashion than adult people. The strategy of differentiation is the most viable in the saturated market of GB because it allows offering unique products and services for the customers. Internet sales is a long-lasting tendency because adolescents do not like to visit shops, they prefer innovative ways of doing shopping. Social media websites will be used to promote the products. Also, feedback of the customers will be trace using forums and blogs to offer better products and services. Using newest communication and information technologies will help attract the target audience and increase awareness of the company. For example, the customers may design their own apparel on the website and order custom apparel. Target Clothing will sew apparel by small lots to test customers’ tastes. Further, more equipment will be bought and the apparel will be sewing by larger lots.
Team & Key Stakeholders
Among the key stakeholders of the company are: customers, employees, investors, business advisors, top managers, social media, and community members. As the resources for starting-up a new venture are limited and the workload is small, the employees working for Target Clothing may assume several roles. The company uses both full-time and part-time employees. Also, freelancers are used to solve accounting, design, and marketing issues. The structure of Target Clothing is as follows: Director (General Manager), marketing and sales manager, designer, accounting manager, and two seamstresses.
Financials
Figure 1 Break-Even Analysis
Figure 2 Projected Profit and Loss Statement
Figure 3 Assets and Liabilities of the Owner
Competition
The competition in the market is high. It is presented by such big players as Next, Marks & Spenser, and Debenhams. However, Target Clothing will use a unique approach to differentiate in the market and to find its market niche.
