Clothes shop business plan template

Executive Summary

Business Overview

La Caennaise Chic will be a clothes shop located in downtown Caen.

The clothes shop will offer a range of quality clothing from major brands and up-and-coming designers, and will mainly target women between the ages of 25 and 45.

The boutique will be developed around two themes: 'out on the town' and 'office chic'. The objective is to offer quality clothes that align with the latest trends, as well as inspiring shoppers with different ideas for outfits.

The boutique will be managed by the two associates who cumulate 7 years of experience in the off-the-rack industry and strong management skills.

Market Overview

French Market

The French women's off-the-rack market reached a total value of €10 billion in 2016.

Growth in the market has been sluggish as of late, due to the changing habits of French women who now tend to spend more on travel and eating out than on clothes.

Nevertheless, French women's historic attachment to fashion means they'll always remain big fashion consumers.

Target Market

Caen was estimated by INSEE to have a population of 106,538 in 2014, and more recently 108,000.

We will mainly target women who are looking for chic clothing.

The typical profile of the targeted clientele is women between 25 and 45 years old, who want to keep up to date with the latest fashion trends and have budgets that enable them to do so with good quality clothes.

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In 2014, there were approximately 26,000 women between the ages of 15 and 44 in Caen, indicating that the customers in our target age group represent a significant portion of the population.

Our offer has been designed to meet two strong demands discovered during our market research:

• Out on the town: whether it's for a coffee with friends, a date on the town, or to party until the sun comes up, our customers are looking for outfits that combine elegance, comfort, and style.
• Office chic: young, stylish, and ambitious, our clients are looking for outfits that showcase their professionalism so they can make a good impression in front of their clients and colleagues.
• To meet these needs, we'll offer a range of quality clothing from major brands and up-and-coming designers, and will organize sections in our boutique dedicated to each of these themes.

Competition

There are many off-the-rack stores within a 200 metre radius of our commercial premises. A high level of competition is expected, as our location is at the crossroads of the city's two main shopping streets.

Although we expect very strong competition with the other women's fashion stores in the city, we believe that the local market is dynamic enough to enable us to establish a sustainable business.

In addition, we believe that our offer has significant advantages that enable us to easily differentiate ourselves from our competitors and attract customers:

• A prime location in the heart of the shopping district
• A wide range of clothing and accessories adapted to the desires of our customers
• An almost exclusive offer of up-and-coming designer brands
• An experienced team and a high level of customer service provided in-store

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La Caennaise Chic will also have to face strong competition from online retailers. In particular, those offering clothing from major brands at reasonable or discounted prices (private sale sites in particular).

We expect a relatively limited competition from online clothes stores insofar as the customer experience offered by our store will be very different from what is offered by websites: the possibility to try on clothes that they can immediately buy and wear, as well as the ability to consult the opinion of a salesperson.

Financial Highlights

We expect the store to be profitable in its second year of operation. Based on the current plan, we expect to achieve sales of:

• €286,680 in year 1
• €342,000 in year 2
• €363,600 in year 3

We expect to generate EBITDA of €-184 in year 1, and €29,295 in year 2 (or 8.57% of margin), and €36,938 in year 3 (or 10.16% of margin).

Net operating cash flow is expected to be positive over the duration of the plan and should allow us to meet our loan repayments while maintaining sufficient flexibility to deal with any unforeseen events.

Our Ask

The objective of this business plan is to obtain bank financing of €52,000 to finance the purchase of part of the furniture, professional equipment and stock necessary for the opening of La Caennaise Chic:

• 5-year loan: €40,000
• Relay loan VAT: €12,000

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