dahlia. dahlia. dahlia. dahlia. dahlia. dahlia. dahlia. dahlia.
dahlia. Business Plan Executive Report Andrea Urquijo Canal BA Fashion Marketing & Communication Level 6, 2018 6FAMN010C Business Modelling & Management CWK2 Pablo Quintano
TABLE OF CONTENTS
In this project, a business plan for the new brand Dahlia will be developed, demonstrating current understanding of data and using an appropriate range of established techniques. The aim of this project is to translate a business opportunity into a coherent and consistent business plan with an accurate financial structure.
1. 2. 3. 4. 5.
Project Aim & Rationale Expected Outcomes Required Investments Business Uniqueness & Differentiation Annex
1. PROJECT AIM & RATIONALE
After having undertaken a deep market
sustainability and fashion consciousness
current fashion and technology trends
research, and having looked at the
are
The
in the market, using social media to
emerging market trends, a new business
problem is that many stores which sell
promote the brand in the showroom
opportunity in the market has been
environmentally-friendly
products
and online. The price is going be higher
found.
are perceived as “tacky� and their
than the fast fashion brands, aiming to
What has been discovered is that in
designs are not as demanding, as they
a high income target, as a result of the
Barcelona, there is a gap in the slow
are not seen as fashionable or trendy.
production being made in Spain and of
fashion market. There are many fast
Furthermore, the stores which sell slow
high quality materials. In addition to
fashion stores such as; Zara, Bershka,
fashionable brands in Barcelona are
selling online, there will be a showroom
H&M and so on, which sell fast
multi-brand stores mainly located in the
which will be open three days a week, in
fashion low quality products, but
TurĂł Park area, and they have a very low
which customers will be able to try on
there are not many stores which sell
availability of products and sizes, having
all the products and have a personalized
slow fashion clothes of good quality
only 4 or 5 products of each brand.
assessment. This will allow the brand
which are fashionable and appealing
The idea is to create a slow fashion brand
to have a higher customer engagement
to young adults. Trends which involve
which produces in Spain, following the
and will enrich the relationship with
very
relevant
nowadays.
1. PROJECT AIM & RATIONALE
customers. The showroom will be
Youtube.
located around the area of Turó Park
Influencers and Brand Ambassadors
in Barcelona, and products will be sold
will be used to promote the brand and
both in the showroom and online. In
gain awareness.
order to have a higher profitability, as
At the launching stage of the brand, we
the showroom will only be open three
will only sell a limited range of products;
days a week, it be also used as the office
trousers, shirts, t-shirts, skirts and
of the brand to amortize the space.
sweaters. If the brand is successful in
The reason for the showroom to only
the future, shoes, bags and jackets will
be open three days a week is in order to
be added to the product range. There
generate “hype” and for the brand to be
will be two main collections launched
seen as “exclusive”.
yearly, in addition to limited-edition
The brand will be promoted through
products which will be launched every
the main social networks for this target;
two to three months.
Instagram,
Facebook,
and
CUSTOMER
2. EXPECTED OUTCOMES
The primary target is women between
are established working women who
17 and 28 years old. These women
attend fashionable events, read fashion
have high
income and are students
magazines and watch fashion shows,
or workers. They are young adults
travel and, most probably, have a huge
who value high quality clothes, yet
wardrobe. They buy luxury products
fashionable design. They are highly
and are up-to-date with what happens
interested in fashion and trends. They
in the fashion industry. What they value
purchase luxury products in addition
most is design and quality but they are
to mass market products. Their main
also deeply interested in conscious, slow
purchase indicators are quality over
fashion.
quantity,
Dahlia will be able to provide these
up-to-date
fashionable
designs, durable materials and timeless
products
products.
and filling the gap in the market.
The
secondary
target
is
women
between 25 and 35 years old. These
satisfying
their
needs
VALUE PROPOSITION
2. EXPECTED OUTCOMES
The ideal customers for Dahlia would
ethical. In addition, they do not shop
shirts, t-shirts, skirts and sweaters both
normally attend fashionable events
in environmentally friendly stores as
in an online store and in a showroom.
which would require high quality
their designs do not appeal fashionable
The customers could benefit from
clothes. These customers would desire
to them. By buying in Dahlia, they
a personalized assessment in the
to look good for work as well as for
could benefit by acquiring clothes
showroom.
leisure and would be very pleased to find
which can last a lifetime, being able
By following the current fashion and
timeless products which are sustainable
to be environmentally friendly yet
technology trends, producing locally in
yet at the same time fashionable.
still fashionable. Furthermore, if they
Spain with high quality materials and
These customers are facing some
would desire, they would be able to
even offering a range of limited-edition
difficulties while searching for this
try the clothes at the showroom before
products, the brand could have a very
desired
purchasing them.
high customer engagement, creating
appreciate the materials fast fashion
Dahlia would enable customers to
meaningful and powerful relationships
brands use in their products and they
make a good impact in society by being
between the brand and the consumer.
feel bad about buying fast fashion
environmentally friendly, offering their
clothes because they think it is not
range of products including; trousers,
products as they do not
REVENUE & PROFIT PROJECTIONS
2. EXPECTED OUTCOMES
In order to have a clear understanding of the costs, revenue and profit of the brand, these have been calculated as well as yearly projections for year 1, 2 and 3. This will allow to know how much is needed to invest, and how long is it going to take to breakeven and to gain profit from this company.
PRICES PRICES
VAT
NON-VAT
Trousers
90
74
Shirts
70
58
T-shirts
30
25
Skirts
65
54
Sweaters
80
66 Figure 1 * All numbers are in euros (€)
2. EXPECTED OUTCOMES
Taking into account the prices of the fabrics in Spain, the materials which are going to be used and the trimmings, the average prices of the products have been calculated with VAT and NON-VAT. All further calculations will only take into account the NON-VAT prices, as these are the prices that will allow us to know which revenues and profit can be accomplished.
INITIAL INVESTMENT INITIAL INVESTMENT Computers
€ 5222
Air conditioner
649
Clothing racks
150
Hangers
400
Steamer
80
Mirrors
400
Sound system
300
Fragrance
40
Furniture
10.000
Wifi installation
100
Graphic design
800
Reforms
15.000
TOTAL
33.141 Figure 2
2. EXPECTED OUTCOMES
In Figure 2, the initial investment of Dahlia has been calculated. The total adds up to 33.141â‚Ź, which is a high amount, as everything needed has been taking into account to be able to have an office and a showroom. It is believed that having a high initial investment is going to permit the brand to grow faster, as the showroom is going to be of high quality and located in a very nice area of Barcelona
MONTHLY COST
MONTHLY COST
€
Rent
3.000
Office material
30
Packaging
638
Shipping costs
1.275
Bills Water bill Light bill
100
Phone bill
200 98
CEO
3.000
Patron
1.200
Designer
1.500
Marketing
1.500
Staff
Sales assistant Production (including trimmings)
TOTAL
900
Trousers
1.520
Shirts
1.200
T-shirts
1.250
Skirts
780
Sweaters
1.200 17.391
Figure 3
2. EXPECTED OUTCOMES
In Figure 3, the monthly cost of Dahlia has been calculated. The total monthly cost is 17.391â‚Ź. It is a high montly cost, as the rent is very high due to the expensive neighborhood in which it would be located. In addition, 5 employees would be needed in order for the business to run properly, which is also expensive. Furthermore, the production would be expensive as every product would be produced locally with high quality materials.
MONTHLY REVENUE MONTHLY SALES PHYSICAL STORE
ONLINE STORE
AVERAGE PRICES TOTAL
NON-VAT
TOTAL
Trousers sold
30
50
80
74
5920
Shirts sold
30
50
80
58
4640
T-shirts sold
50
75
125
25
3125
Skirts sold
20
45
65
54
3510
Sweaters sold
25
50
75
66
4950
TOTAL
22.145 Figure 4
2. EXPECTED OUTCOMES
In Figure 4, the monthly revenue of Dahlia has been calculated by calculating the total sales of each product (considering both physical and online store) and multiplying it by the prices of each (NON-VAT). The total monthly revenue is 22.145â‚Ź considering the brand sells 425 items each month.
MONTHLY PROFIT
MONTHLY COST
17.391
MONTHLY REVENUE MONTHLY PROFIT
22.145
4.754 Figure 5
2. EXPECTED OUTCOMES
By substracting the monthly cost to the monthly revenue, we can conclude that the monthly profit for Dahlia would be 4.754€.
YEARLY PROJECTIONS 160000 160.000
142.332 120000 120.000
80000 80.000
74.160 40.000 40000 23.907 0 Year 1
YEAR 1
Year 2
YEAR 2
Year 3
YEAR 3 Figure 6
2. EXPECTED OUTCOMES
After having caculated the monthly profit for the first year, the yearly profit was calculated, taking into account the cost of the initial investment and multiplying the monthly cost by 12 months. Finally, it was found out that the profit for the
YEAR 1
first year of Dahlia would be 23.907€.
COST
REVENUE
PROFIT
241.833
265.740
23.907
To calculate the profit for the second year, the sales were incremented by 10%. Subsequently, the costs of production Figure 7
YEAR 2 COST
REVENUE
PROFIT
218.160
292.320
74.160
increased by 10% and, in addition, the costs of the office material, packaging and shipping also increased by 10%. After having calculated this, it was concluded that Dahlia would have a profit of 74.160€. To calcultae the profit for the third year, the sales were
Figure 8
incremented by 50%. Subsequently, the costs of production increased by 50% and, in addition, the costs of the office
YEAR 3 COST
REVENUE
PROFIT
256.284
398.616
142.332
material, packaging and shipping also increased by 50%. Furthermore, as the production would be much higher, Figure 9
it would be needed to employ 3 more employees; another designer, another individual in charge of marketing and another sales assistant, which would also increase costs. After having calculated this, it was concluded that Dahlia would have a profit of 142.332€ in the third year.
dahlia.
3. REQUIRED INVESTMENTS
In order for the brand Dahlia to be
brand will need designs, branding,
control. As mentioned previously, in
possible and successful, certain key
trademarks and patents.
order to achieve this, 241.833â‚Ź will be
resources will be needed.
Regarding human resources, the brand
needed to invest in the first year.
Regarding
physical
resources,
the
will need a CEO, a patron, a designer, an
brand will need a space both for
individual in charge of marketing and a
the showroom and for the office. In
sales assistant.
addition, some resources will be needed
Regarding financial resources, if the
to open the showroom; clothing racks,
owner of Dahlia does not have sufficient
hangers, computers, air conditioner,
capital to cover all the investment, a
sound system, fragrance, furniture,
business loan will be needed in order
wifi
installation,
for the brand to be possible.
cash
register,
graphic
packaging,
design, mirrors,
Regarding key activities, the brand
mannequins, cleaning supplies, website,
will need; marketing and selling,
ecommerce site and shipping account.
apparel manufacturing, supply chain
Regarding intellectual resources, the
management, designing and quality
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future customers
4. BUSINESS UNIQUENESS & DIFFERENTATION
Dahlia would provide garments, and
as it would be a brand which not only
addition to trust to its customers. Its
would provide goods to those who
customers would provide money to
would be inspired by its designs, but
Dahlia, as well as providing word of
would also contribute to making the
mouth to future customers, allowing
world a better place with its sustainable
Dahlia to produce products which
approach.
would result in being a future purchase
opportunity to fill the gap in the fashion
for the future customers, proving Dahlia
industry in Barcelona in a unique way,
with more revenue. This would be
which would allow the brand to deeply
possible if the manufacturers provided
engage with its customers and create
the right products to the brand and
lifelong relationships.
Dahlia would benefit them by providing
The brand would be differentatied to
them with money.
other brands by being unique in the
To conclude, it is thought that Dahlia
production of the products, yet still
would be a great business to invest in,
being fashionable and trendy.
It
would
be
a
great
BRAND PERSONA PRIMARY TARGET
Pains & major preoccupations
She is always worried that she will not be enough. She wants to find a perfect job that allows her to have enough money to travel and raise a family the way that she has been raised. She is worried about her future but also the world’s future.
Gains: how does she measure success?
Success for her is to be valued by her family and friends. In addition, she measures success by her grades and accomplishments.
Environment: what friends does she have?
She has friends that are similar to her. They all have the same background and believe in the same things.
5. ANNEX
CLARA Description
Personality - Hard-worker - Ambitious - Perfectionist - Conceited - Caring - Kind - Polite - Moody - Familiar - Open-minded - Loves to travel - Loves fashion - Has lots of friends and enjoys spending time with them
- 19 years old - From Barcelona - ESADE, Business Administration student - Taking Cambridge Proficiency les-
Core Values - Career success - Family - Happiness - Wealth - Friendship
sons
Physical Appearence
Beliefs
- Long brown hair
- Culture
- Skinny
- Education
- Short
- Experience
- Tanned skin
- “Hard work and perserverance are
- Green eyes
rewarded�
BRAND PERSONA PRIMARY TARGET
Pains & major preoccupations
She worries about her relevance in her workplace. Her biggest desire is to have wealth. She is worried that she is too independent and will never find stability.
Gains: how does she measure success?
She does not measure success on her personal life but more on how others view her life.
Environment: what friends does she have?
She always has temporary friends, as a result of her constant change of cities and jobs.
5. ANNEX
ALEXANDRA Description
Personality - Selfish - Strict - Trust-worthy - Friendly - Talkative - Honest
- 25 years old - From Paris but living in Barcelona - Previously studied Fashion Marketing & Communication at IED
Core Values - Wealth - Career success - To know a lot of fancy people - Independence
- Currently working at a media agency
- Familiar but she is living away from her family - Loves to travel and travels a lot due to her job - Loves fashion - Has lots of friends and enjoys spending time with them
Physical Appearence
Beliefs
- Tall
- Education
- Skinny
- Experience
- Blonde
- Faith
- Short hair
- Self-love
- Very white skin
- “Things are impermanent�
- Brown eyes
BRAND PERSONA SECONDARY TARGET
Pains & major preoccupations
She worries about not being perfect.
Gains: how does she measure success?
Success for her is being perceived by others as successful and to achieve everything she wants in life.
Environment: what friends does she have?
Her friends are mostly from the fashion world, as she attends to fashionable events. She has friends from all over the world and she is very loyal to them.
5. ANNEX
JULIA Description
Personality - Workaholic - Friendly - Cheerful - Prone to stress - Generous - Loyal - Fashion is her passion and what she wants to do for the rest of her life - She attends every fashionable event in the main cities - She loves her job
- 27 years old - From Barcelona - Previously studied Fashion Styling in Centrail Saint Martins (London) - Works at Santa Eulalia store as store
Core Values - Integrity - Career success - Independence - Honor - Brilliance
manager.
Physical Appearence
Beliefs
- Regular height
- Hard work
- Regular weight
- Experience
- Brown hair
- Faith
- Long hair
- Consistency
- Brown eyes
- Efficiency - “I don’t need the approval of others to succeed”
BRAND PERSONA SECONDARY TARGET
Pains & major preoccupations
Her major preoccupation in life is not spending enough time with her family due to the amount of work she has to deal with.
Gains: how does she measure success?
Success for her is having the perfect family and being happy with what she has. She always tries to make everyone happy.
Environment: what friends does she have?
She has had the same friends since forever. She cherishes her friendships very much and always looks after her friends.
5. ANNEX
SOFIA Description
Personality - Caring - Friendly - Entrepreneur - Accessible - Admirable - Charismatic
- 32 years old - From Barcelona - Previously studied Architecture at UPC (Barcelona)
Core Values - Adaptability - Fidelity - Balance - Common sense
- Has her own interior design store
- Cooperative - Educated - Intelligent - Her passions are fashion and interior design - She attends events of the art field in Barcelona - She loves her job and has a 3 year old kid
Physical Appearence
Beliefs
- Short
- Faith
- Chubby
- Commitment
- Brown hair
- Positive thoughts
- Short hair
- “I can make tomorrow better�
- Brown eyes
VALUE PROPOSITION CANVAS
5. ANNEX
dahlia.
Dahlia: slow fashion store
Being able to be environmentally friendly yet still fashionable
Enables customers to make a good impact in society Online store
Enables customers to be environmentally friendly
Showroom
- Trousers - Shirts - T-shirts - Skirts - Sweaters
High quality materials
Local production: Spain
Dahlia customer
Limited-edition products
Brand which follows the current fashion and technology trends
Customer engagement Personalized assessment
Being able to try the clothes in the showroom before buying them
They hate buying fast fashion clothes because they feel bad about it They don’t like the materials fast fashion brands use in their products
Buying clothes that can last many years
Look good for work and leisure
Attend fashionable events Find high
Find timeless
quality clothes
products
They don’t shop in environmentally friendly stores because they don’t find the designs fashionable
Find sustainable yet fashionable clothes
MONTHLY COST YEAR 2 & 3 € MONTHLY COST YEAR 2 3.000 Rent 33 Office material 702 Packaging 1.403 Shipping costs Bills 100 Water bill 200 Light bill 98 Phone bill Staff CEO 1.000 1.200 Patron Designer 1.500 1.500 Marketing 900 Sales assistant Production (including trimmings) 1.672 Trousers 1.320 Shirts 1.375 T-shirts 858 Skirts 1.320 Sweaters TOTAL 18.180
Figure 10
€ MONTHLY COST YEAR 3 3.000 Rent 45 Office material Packaging 957 Shipping costs 1.913 Bills 100 Water bill 200 Light bill Phone bill 98 Staff 1.000 CEO 1.200 Patron Designer 1 1.500 Designer 2 1.500 Marketing 1 1.500 Marketing 2 1.500 Sales assistant 1 900 Sales assistant 2 900 Production (including trimmings) Trousers 2.280 1.800 Shirts T-shirts 1.880 Skirts 1.176 Sweaters 1.808 21.357 TOTAL
Figure 11
5. ANNEX
As explained previously in the coursework, the monthly cost would also increment as the sales increment.
MONTHLY REVENUE YEAR 2 & 3 YEAR 2
MONTHLY SALES PHYSICAL STORE
ONLINE STORE
AVERAGE PRICES TOTAL
NON-VAT
TOTAL
Trousers sold
33
55
88
74
6.512
Shirts sold
33
55
88
58
5.104
T-shirts sold
55
83
138
25
3.438
Skirts sold
22
50
72
54
3.861
Sweaters sold
28
55
83
66
5.445
TOTAL
24.360 Figure 12
YEAR 3
MONTHLY SALES PHYSICAL STORE
ONLINE STORE
AVERAGE PRICES TOTAL
NON-VAT
TOTAL
Trousers sold
45
75
120
74
8.880
Shirts sold
45
75
120
58
6.960
T-shirts sold
75
113
188
25
4.688
Skirts sold
30
68
98
54
5.265
Sweaters sold
38
75
113
66
7.425
TOTAL
33.218 Figure 13
5. ANNEX
In addition to the costs, the revenue also increases in year 2 and 3 due to the increase in sales.