Fact or Fiction
Content created by Petite Boutique: http://www.petiteboutique.net/factorfiction
Fact or Fiction
Content created by Petite Boutique: http://www.petiteboutique.net/factorfiction
Fact or Fiction
Content created by Petite Boutique: http://www.petiteboutique.net/factorfiction
Wear Sizing DOES matter
Welcome to the Petite Shop Experience
Executive Summary
 The Opportunity – Investment in an upstart Petite
Clothing Shop
 Mission/Keys To Success
 Marketing Plan
 Operations Plan
 Human Resources Plan
 Financial Plan
 Key Implementation Factors
Mission
“Wear sizing does matter. Welcome to the Petite Shop
Experience”
 Our Mission is to be the premier destination for petite
women to purchase their wardrobe. Petite Shop is
dedicated to providing our customers with high
quality personalized service. We want to be responsive
to our customers needs for well fitting trendy and
classic clothing at reasonable prices.
Keys to Success
Wear Sizing DOES matter
 1. Providing petite customers with both trendy and classic
clothing that provide them with excellent fit and style.
 2. Offering high quality personalized service by getting to
know customers on a one-on-one basis.
 3. Converting customers from ‘‘just looking’’ to “I want to try
this on” to a resulting purchase.
 4. Generating word–of–mouth marketing through customer
satisfaction.
 5. Creating repeat business through customer satisfaction.
Strategy
 First Mover Advantage – size of Prince George Market
(86,100) will not support a 2nd Petite women’s store
 Little Direct Competition – Reitman’s
 Specialty Fashion –  risk of inventory obsolescence
 Customer power:
 Consumers fickle when it comes to fashion, however
lack of petite sized options reduces this risk
 Loyalty
 Supplier power: low – will buy from smaller suppliers
Positioning vs Competition
 Women’s clothing Stores:
 Style: Varies (static, fashionable, high fashion)
 Fit: No or little petite sizing available
 Pricing: Varies (High quality & low cost)
 Department Stores:
 Style: ‘Unfashionable’, Business clothing targeted at older (>age 30)
women
 Fit: No or little petite sizing available
 Pricing: Low cost
 The Petite Shop:
 Style: Fashionable yet Timeless
 Fit: highly customized
 Pricing: Higher Quality
Target Market Segment
Market Analysis
The Petite Shop
12%
Competitors
88%
Target Market
Market Needs
 Clothes that fit right for women 5’’4 and smaller
 Selection



Type
Style
Occasion
 Affordable prices
 High level of quality customer service
 Accessibility to store outside regular working hours
Target Market
Market Trends
 Major US retail department stores have minimized or completely
eliminated their women petite clothing departments.
 Sears Canada and The Bay have stated that they have no plans to
downsize the category.
(Canadian Business Online, 2006)
 Retail spending continues on an increasing trend (Statistics Canada, 2008)
 Several major retailers have expanded into the Prince George
area a trend which is expected to continue.
(City of Prince George, 2008)
Target Market
Market Growth
 Plus size category is currently growing at a faster pace
than petite women’s clothing.
 Potential increase in target market demographics
through expansion and movement of companies into
Prince George.
 Prince George turning into a transportation hub for
Northern BC
Marketing
 Product & Services
 Price
 Promotion
 Place
Clothing Lines: Sizes 0-9
Trendy (Target: age 25-32)
 Business Casual Pants (year







round)
Dress Shirts (year round)
Skirts (spring/summer)
Capris/Shorts(spring/summer)
Dresses (summer)
Chic Tops (year round)
Coats (fall/winter)
Cocktail dresses (year round)
Classic (Target – age 33-45)
 Business Casual Pants (year







round)
Dress Shirts (year round)
Skirts (spring/summer)
Cardigans
Dresses
Blouses
Coats (fall/winter)
Cocktail dresses (year round)
See Tall Girl Shop For Style Examples: http://www.tallgirlshop.com/ca/information.php?info_id=3
Service
 Committed Owner/Manager that is a customer herself
 Getting to know customers on a one-on-one basis to
determine their needs.
Price
 Average family spends $1000/yr
 Customer Goal: Maximize budget
 Mid Range $30-90
 Tops $40
 Pants/Skirts $50
 Dresses/Jackets $90
 Competitors
 More frequent sales promotions
 Key differentiator: Service vs Price
Promotion
 Grand Opening Party
 Radio
 Newspapers
 Targeted door-to-door flyer campaigns
 WORD OF MOUTH
 Population: 77K
 Most effective method!
Place
 Prince George, BC
 Central Business
District
 Busy street
 High foot traffic
 High concentration
of Boutique shops
 Close to office
buildings
 Suburbs - 20 min
drive
SWOT Analysis
 Strengths:
 Experience in the Retail Industry
 Location in the central shopping/business district
 Classic & Trend Conscious clothing lines
 Weaknesses:
 Lack of prior experience in running a business
 Limited business management knowledge
SWOT Analysis
 Opportunities
 Only a few stores in Prince George offer Petite wear
 Department stores not catering to needs of Petites
 Threats
 Only 20% of the women’s clothing market represents
petite wear
 Several retailers are expanding into Prince George
SWOT Analysis
 Threats Cont’d:
 High fashion boutiques are located downtown
 Inability to secure sufficient financing
 Retail industry experiences high employee turnover
 Unemployment rate has increased in Prince George
Operations Plan
 The Business
 Alice Wood owner and part time employee
 Specialty Petite Boutique
 Quarterly communication with the Bank and potential
Angel Investors
Operations Plan
 Floor Plan
Operations Plan
 Hours of operations:
 Monday – closed
 Tuesday to Wednesday – 10am to 6pm
 Thursday to Friday – 10am to 8pm
 Saturday – 10am to 6pm
 Sunday – 12pm to 6pm
 Open 300 days a year
Operations Plan
 Inventory will be ordered from Petite Clothing
Manufacturers
 3 times a year – aligned with the seasons
 Distribution centre in Vancouver
 License required – Business License $100
 Incorporation
Operations Plan
 Planned capital budget investment
 Furniture & Fixtures
 Equipment (eg: Cash Register)
 Leasehold Improvement
 Start up inventory
Human Resource Plan
 3 Employees:
 Alice (full time)
 1 Part time assistant
 1 seasonal
 Human Resource Strategy
 Training- informal/in-
house
 Management
Images From HR By Design, ewashtenaw.org
 External Expertise
 Bookkeeper /Accountant
 IT Service providers
 Meetings with Stakeholders
Human Resource Plan
Year
1
2
3
4
5
$
Owner-Manager Salary
36,000
37,080
38,192
39,338
40,518
Salesperson
Wages
15,000
15,450
15,914
16,391
16,883
Total Salary Expense
51,000
52,530
54,106
55,729
57,401
7,650
7,880
8,116
8,359
8,610
20
21
21
22
23
58,670
60,430
62,243
64,110
66,034
Total Benefits
Training Program costs
Total HR Expenses
Financial Plan
Sales Forecast:
 Price: full ($54) and discounted prices ($27)
 Quantity: 17-22 units/day * 25 days/month
 Markup: 75% to 100%
 Average Gross Margin: 49%
 Most Likely Utilization: 1st year: 65%; 2nd year: 85%;
 Nominal Growth Rate: 3%
Financial Plan
Costs and Expenses:
 COGS: 51%
 Inventory Turnover: 3 turns, average 100 days/turn
 Expenses: Schedule C
- Startup Costs
- Recurring Costs
Performance Comparison
Liz
Jones NY
Claiborne
Ralph
Lauren
The Petite
Shop
Gross
47.8%
Margin %
36.36%
54.48%
49%
Inventory 4.7x
Turnover
4.8x
3.8x
3x
Average Industry Ratios:
Gross Margin = 41.60%
COGS = 58.40%
Financial Plan
Summary of Projection:
 Sales Revenue
 Net Income
Capital Budget
 Total Capital Costs of $60,018
 Consists of:
 Furniture and Fixtures - $8,000
 Equipment (such as cash register) – $5,000
 Leasehold improvements – $12,000
 Start up inventory purchase – $33,518
 Incorporation costs- $1500
Financing
 Capital Requirements- $60,018
 Alice Equity- $25,000
 Debt Required- $35,000
 Debt Terms: 5 Year Loan, 10% interest
 Limited collateral from The Petite Shop
 Alice can use the $500k personal condo as collateral
Sensitivity and Break-even
Analysis
 Appendix 4- Sensitivity Analysis
 Appendix 12- Break Even Analysis
Start up/
Implementation
Questions / Comments?