Business Plan Executive Summary Dimension crafts individually, customised bags, made by hand in the UK from long lasting, durable, technical fabrics. Involving the customer from the start of the design process through our online questionnaire, allowing the product to be modified to tailor his or her own practical specification. Dimension is optimal for young professionals with an active, working and travelling lifestyles. We strive in producing bags that will not only look good but will perform well. Business Description The accessories market is a section within fashion that is forever growing. There are new individual companies rising along with current, successful brands developing their own accessories ranges. As well as seeing growth in who is offering bags, the price ranges are also becoming more diverse, ranging from low high-street prices up to designer prices. We will be launching our company straight into the high end point of the high street, offering our products and service solely through the Internet via our website, social media and a free app, a platform that is becoming more commonly used. The decision to promote and sell our products through the Internet was formed due to our customer and consumer profile, both of which are the same. Dimension provides a service and product that is accessible to many, aiming at young professionals, both male and female, aged between 18-30. Our customer and consumer is a full time worker that leads a busy lifestyle in the city, travelling a lot with their commute and for adventure. He or she enjoys living a healthy lifestyle as well as being social, visiting small, unique cafes and bars in London. They have the expansive to shop in high-end high street stores and own top of the range gadgets, such as phones, laptops and cameras, all of which are belongings that need a practical bag to be stored. Competitor Analysis Although Dimension is very unique and different brand there still are competitors throughout the personalised industry, which could affect our start up if we don’t make ourselves aware of them. The first and most direct competitor is Longchamp’s personalisation service which is an option along side their bags. Longchamp is a well known, luxury French bag company that have recently adopted a personalised service to go alongside their website. The idea of this being that it allows consumers to pick and choose the colour, style and fabrics of their Longchamp bag and even get it engraved. The price ranges from £28 £475 depending on what style, size and fabrics are chosen. As far as the companies website goes the layout is easy to use and very functional, this is
something that is very important for Dimension to focus on as personalisation can become very confusing. Longchamp is a competitor of our brand dimension because of the general concept of personalising bags. Although he whole idea of Dimension is tailoring a bag to what you put in it unlike that of Longchamp, yet they both have the concept of making bags more personal to you. Another competitor for our brand Dimension is Baubax a men’s and women’s outerwear company. Baubax was started up due to crowdfunding, they offer jackets, coats and blazers that provide the most practical garments for travelling with many different pockets and features to make your journey the easiest it could be. For example, jackets are fitted with neck pillows, eye masks, portable charger pockets and pen stylus for your technical equipment. This niche brand is similar to Dimension in the way it offers practical objects however Baubax doesn’t offer a personalisation unlike Dimension. Throughout a first had visit to London we came across the company Unmade who create personalised jumpers and scarves right in front of you at a pop up store in Selfridges. The idea behind the company is delivering garments that the customers are choosing and making the changes themselves. This concept has been developed from collaborations with fashion designers, graphic designers and illustrators to give you a one off, machine knitted garment. Unmade is a competitor of our company Dimension throughout their concept of making something personal and unique to the consumer. Although Unmade is a pop up store whereas we intend to trade online for the purpose of making the personalisation more detailed and functional. Secondary Research Dimension as you know is a company that prides itself on the USP of being personal and functional. Following this it was important to explore the existing market and whether there is actually a gap for a brand such as Dimension. Second hand research suggests that the demand for personalised and custommade items is forecasted to increase. The research highlighted that the personalised and custom market is going against the mass-market traditions. Although personalisation is increasingly popular, it is still a very niche market because it trades with consumers on one to one bases. Research also indicated that customers whom invest in personalised products are more likely to remain brand loyal towards that company because they feel a more personal relationship with the brand. Personalisation is becoming increasingly popular because as individuals are becoming more self-expressive over time, therefore the demand for personalised products is increasing because as individuals we want to be recognised as their own selves. Therefore the market is in a beneficial state for our brand Dimension because personalisation is becoming more important to individuals.
Primary Research We produced a questionnaire and published it on social media in order to get as many respondents as possible. Our reason behind this is to establish whether there is a market for our product and to also gain some valuable information about our consumers’ demands. The first question on our survey is to ask how old the participant is, we choose to include this question because we want to make sure our target audience of young professionals is doing our survey so this will determine the accuracy of our results. As you can see the majority of our participants are between 18-24 which is the age range of our target audience that means the results are most likely to be valuable for the market research of our business.
These are a few responses from a question to determine the occupation of our participants, as you can see a majority of these are professional jobs and by the looks of it at the start of their professional career. Again this is assuring the validity of the results from our survey because they reach our target consumer of ‘young professionals’.
Following on for this we want to establish what people actually put in their bags. This allows us to make a justified decision about the pocket features and personalised options we’d like to incorporate.
Next we wanted to find out how much people are prepared to spend on a bag, these results came in with ÂŁ20-ÂŁ39 being the most popular. Therefore this is something we need to take into account when setting the price of our product.
Within this question we wanted to establish which of our 4 bag themes would be the most popular. The research showed work bags to have the highest demand in terms of what consumers need, this therefore will help with production and promotion.
This question intends to establish how we are to market our product and whether durability is something that appeals to our consumer. As you can see the results showed that 63.64% are in need for a functional bag, although 36.36% where not therefore we are going to have to be very careful within marketing and really emphasise on the USP of personalisation. Here we are looking to find out whether our consumers prefer practically or style as you can see the results where very close yet more people preferred style. Therefore we will look to market our product as both practical and stylish therefore it will appeal to our consumer needs.
Lastly we are looking to find out if personalisation is something that would appeal to our target consumer of which the majority responded yes, therefore there is a market for our product we just have to make sure we market it as stylish, practical and personalised.
Overall the results have come back very positive for our brand dimension and have highlighted a number of things to be aware of and to consider in the process of gaining further consumer demand. SWOT Analysis Strengths: •
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There is nothing else like Dimension out on the market. Therefore there is a gap in the market and competition won’t be as aggressive. It also means that as a business we can set the price point because there is no need to initially worry about similar brands. The product is both functional and fashionable. This means it will appeal to people who want a fashionable bag but they want it to last and be functional. Therefore something that will appeal to our target audience of young professionals. Dimension is such a unique brand this therefore gives the company great potential in general.
Weaknesses: •
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The price of our brand is a weakness because we are aiming at a luxury high street price. Therefore will young professionals may not want to spend their money on our product because they are not yet earning their full potential. There might be a reason why there is a gap in the market and no one else has entered.
Opportunities: •
Further Investment opportunities for example Dimension could attend trade shows to gain more brand recognition and potentially obtain venture capitalists. Further Investment means we can expand the company.
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To further our brand image we could look into exploring collaborations as a future opportunity. A successful start up meaning the company wouldn’t face any major problems throughout the first few months of trading, as they are the most fragile.
Threats: •
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New competitors are always threats to start up businesses. Another company could potentially bring out a similar idea to our brand but sell it for a lower price. Many start-ups are unsuccessful therefore Dimension is under risk of consumers not identifying with brand.
Marketing Mix Product Dimension is a company whom provide a personalised, functional and practical bag service. Our aim is to break the boundary between function and fashion. We will go about this by allowing our customer to create and design their bag around their usual bag habits and what they’d tend to put in it. Our service will therefore trade online because it’s very hard to open up a store of a start up personalised product. In terms of the personalisation of the bags we intended to have a number of bag styles, which have further room for personalisation, throughout the interior and exterior. Dimension targets young professionals; this allows us to price our product towards the more luxury end of the market because our customers have the disposable income to invest in a functional personalised bag. Therefore the pricing of our product will be fairly luxurious depending on what bag style and options the consumer chooses Place Dimension is a company that intend to only trade online throughout the initial start up. We decided to head in this direction because firstly our company’s USP is the personalisation of the bags. Therefore being a personalised brand we would be able to function better online. Another reason for this is because we believe that having an online presence is very important at the moment, so we would like to direct our attention towards establishing our online profile. Promotion We will look to promote our company firstly throughout social media. Social media is an amazing free source of promotion. It will allow us to spread the word of our new brand, therefore we intend to utilise this fully. We have set up Facebook, Instagram and twitter accounts. This is because we feel they are the used the most by our target customer. Throughout the social media we intend to
maintain a very strong brand aesthetic in order to remain true to our brand identity. Another form of promotion we are going to be exploring is advertising in Stylist magazine. Stylist magazine is a free weekly magazine for smart, successful, sophisticated women. Combining journalism, articles on social and workplace trends, fashion, beauty, celebrity interviews, food and the latest travel. Stylist is a magazine for women on the go. New issues are usually released onto the site on Tuesday afternoon, occasionally Wednesday and dispatched by first class post on Wednesdays. We believe that stylist magazine is the ideal magazine to advertise our brand dimension and to spread the word of our company. Firstly because our target consumer is young professionals, of which is very similar to that of the magazines. Customer Loyalty To obtain and secure customer loyalty Dimension has established a customer loyalty policy. As an exclusively online business it’s important that our discounts, sales and deals are well advertised to our customers. We have produced 4 different policies in order to help maintain a relationship with our consumer. • • • •
10% off your first bag if you sign up as a member on our website. If you refer a colleague, you receive 10% off your next bag. If you buy a bag you will then receive a newsletter each month with a suggested bag for you. Invites to our pop up stores and receive special discounts.
Operations It terms of the operations of our business Dimension we’d like to manufacture our product in the UK ideally on the outskirts of London. We believe that if we manufacture in the UK we can maintain the quality of our company and travel costs won’t be as much as manufacturing abroad. Manufacturing in he UK will also allow us to maintain strong company ethics because we wouldn’t be associated with any of the controversy around sweatshops. The company’s employees are another aspect that we need to further explore throughout operations. We are looking into purchasing Lectra machines for the manufacture of our products these will be located in our warehouse. Therefore we need to acquire a Lectra license and the software. We will need to employ skilled craftsmen whom are Lectra trained to produce our bags, this is because we are aware that if we were to produce our bags on a production line it would be really difficult because every bag is individual and unique. As a company we will also need to hire a human resources team to maintain the businesses image in terms of ethics, hire and look over manufacturing staff and to deal with company policies.
Another aspect we need to consider is transport and how we intend to transport our goods from one location to the next. Luckily we will be located in the UK close to London so transport wise we’d only need to initially arrange lorry or postal delivery. Our site will be a UK site so we wouldn’t expect to receive any orders initially from other countries, but we will still deliver there but at an extra delivery cost. For our product Dimension bags we appreciate that our fabric choice is going to be very valuable to assure the quality and functionality of our bags. Therefore we are looking to produce our bags in an option of two different materials which will varies the price depending on which fabric is used, the first and more expensive option is a Vegan Leather PU (polyurethane) + PVC this will cost us £6 per meter and will be supplied to us from a company called Hantex enterprises limited. Our second fabric option is a polyester that is the durable material usually used for sports or athletic bags, this will cost us £2 per meter. It is important to us that we use a fabric that is easily available in different colour ways, is sturdy, long lasting, looks professional and fashionable. Meaning that throughout operations we are going to have to network and gain a good relationship with suppliers, this may mean we can negotiate better terms that are going to be valuable for a start up business.
Finance Throughout the financial aspect of our company we have to consider many costs that are involved in starting up a new company. The first of which are the employees, we need to consider how much their salary would be before we figure out how much money we need to start up. We are looking into initially taking on partly interns and part time staff because we feel this is more cost effective for a start up company. Dimension is also looking into advertising on in Stylist magazine, which is the free magazine easily available to commuters whom are our target customer. The cost of running an advert it the magazine rages between £21,740- £106,620 depending on the location of the advertisement space. Below we have produced some charts that establish our start up costs, production costs and overhead costs. They display all the costs we need to be aware of, they also allow us to forecast and evaluate how our company stands in terms of success.
The results from our charts show our total start up costs to be ÂŁ31,230 and total costs to be ÂŁ230,300, these are valuable because they allow us to establish how much we need for initial investment in order to be able to startup dimension. They also provide us with the figures we need to determine how many sales we need before we cover costs of which we worked that out to be 1152 bags sold at the average of ÂŁ200. Within the first year of trading we are expecting to only sell 100 bags, this is because we appreciate that our brand is very niche and we
need to gain more of a brand identity and reputation before sales pick up dramatically, of which we are aiming for this too start happening within the second year of trading.
Funding To finance our business Dimension we need £230,000, this will cover us for the first year of trading when our costs are expected to be higher than our income. Although over time we expect our business sales to pick up when we have established an identifiable brand name. We intend to source the finance firstly by creating a page on crowdfunding, which is a way to raise initial money and awareness for our business concept in return investors will receive rewards that are value for money. After this we will evaluate how much investment we have received and see how much more we need to get. Then we will take out a loan for the amount extra that we need to successfully start up. Future 5 year plan Product: •
We would like to expand personalisation elements colours/fabrics this will allow our product to be more personalised which will enhance the USP and satisfy consumers.
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Wholesale to other brands or companies around the UK to gain brand recognition.
Marketing: •
Attend more trade shows to further establish brand recognition. This will also allow buyers to see what our company stands for and what they produce, which means potential wholesale opportunities.
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Continue to maintain a strong social media and to also advertise in magazines that would appeal to target audience such as Stylist magazine.
Operations: •
Recruit more staff as company expands therefore keeping up to date with demands of the business. Also recruit a majority of staff on a
permanent basis to make them more loyal to the company meaning they will be more motivated at work. Finance: •
We need to consider extra costs associated with expanding the product range.
10 year plan Product: •
Consider doing a collaboration with a celebrity or another company this further our brand image and identity, it will also be a good opportunity to network.
Marketing: •
To go along side the company’s collaboration we would need to produce an updated marketing campaign, this will spread the word and create demand for the product.
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Our company trades primarily in the UK although delivers abroad at an extra cost, therefore as a part of our 10 year plan we’d like to try venture into different countries. We will do this by attending more trade shows because they will allow us to get our product known and out there, it will also be an opportunity to network.
Operations: •
Once the company has been established abroad look-wholesaling opportunities aboard, therefore international consumers whom are a fan of the products can purchase without added cost of delivery.
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As a company we may need to recruit more staff to keep up with demand, perhaps even staff that speak multiple languages to help with trading abroad.
Finance: •
We will need to look into the extra costs associated with trading internationally. These include travel, extra staff and an increase in sales therefore we will need to purchase more supplies.