Triangle Exchange Business Plan

Triangle Exchange Business Plan

MDS, Owner/Founder 773.123.0123 MDS@triangleexchange.com 1510 W. Fullerton Ave Chicago, IL 60612

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Table of Contents Executive Summary Company Overview Mission Statement Vision Statement Product and Service Store Location Marketing and Sales Plan Demographics and Psychographics Triple Bottom Line Competition Partnerships Company Organization and Management Structure Job Descriptions Organizational Flow Chart Operation’s Manual Accounting and Financial Information Reports 3-year Financial Projection Legal Structure Investing Risks Incentives

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Executive Summary As an out and proud LGBT person, I know what Chicago needs to serve the community. Triangle Exchange is a non-gendered second-hand apparel company in the DePaul Neighborhood of Chicago, Illinois. We sell hand-selected second-hand clothing and vinyl records, as well as new transitional apparel for transgender and queer customers. The LGBT community, especially transgender individuals, are extremely underserved in the apparel sector and can find it hard to establish safe connections with businesses. Chicago and the surrounding area in Cook County have some of the highest incarceration rates in the country, and most are for nonviolent, drug-related crimes. Often, these people receive lengthy sentences for small crimes and are never offered a second chance. .

Triangle Exchange is committed to providing previously incarcerated people with that second chance, as is our company policy. All of our employees are paid a fair, living wage, are given access to career training and are encouraged to seek out educational opportunities. Not only do we sell transitional apparel, we also host a donation program to benefit underserved and impoverished people. Our hope for our store is that it will be a safe and comfortable place for all people, especially LGBT individuals, to socialize within the community. We will be hosting night events to encourage this, including Open Mic Nights and Album Listening Parties. Other services will include free sizing and styling help for customers and a customer rewards punch card.

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Company Overview Mission Statement We strive to support our community by: ● ● ●

providing affordable, environmentally-friendly and non-gendered apparel to a diverse audience, especially LGBT individuals, hiring previously incarcerated people (non-violent offenders) and students from the Chicagoland area and providing a living wage and benefits, offering free support services to community members and donating transitional products to those who cannot afford them.

Vision Statement We imagine a Chicago where marginalized people are supported environmentally, socially and culturally through innovative and conscious businesses.

Product and Service We will provide cultivated second-hand clothing and accessories in as many styles, sizes and types as we can find. We will also offer used vinyls, a popular and growing market.1 To help our transgender customers, we will sell new chest binders from gc2b which will include a free sizing service and a donation service for used binders for those who cannot afford them.

Store Location The store will be located at Fullerton Lofts, 1510 W Fullerton Avenue, in the heart of the DePaul Neighborhood. We will be renting the space from Group Fox Management for $3,466/month, which includes property tax. The space has many amenities, including parking, heating and cooling, a fireplace, laundry use, high ceilings, natural light, an open layout with hardwood flooring, plus close access to the Red, Brown and Purple ‘L’ lines. .

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​Rosenblatt, Bill. “Vinyl is bigger than we thought, Much bigger.”​ Forbes.com​, Forbes, 18 Sept.

2018.

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Marketing and Sales Plan Demographics and Psychographics Chicago is a great city for a business with a target audience of 15 to 35. The age chart of Chicago spikes at 25-29, with more than 10 percent of the total population falling in between these ages.2 It is a very accessible city with regards to public transportation (meaning most everyone has access to our location) so I will not be focusing on the demographics of the specific neighborhood. About 28% of the population takes public transportation every day to get to work, school, or home, which allows for a large market of people with access. The overall goal is that customers will come from all over the city. I am aiming for all of the products to be $50 or less, with the average price per item landing at about $5-$15. Thisworks well for a city whose median yearly income is about $55,000, which is solidly middle-class. Chicago and Cook County are consistently liberal and blue, with more than 60% of Cook County residents voting democratic in the most recent presidential election.3 There is an estimated 146,000 adults who identify as LGBT living in Chicago, though the real number is likely much larger, especially if you consider people under eighteen years old, who are more likely to identify in the LGBT community. A large amount of audience will be based on LGBT people, but I will also be focusing on allies due to the left-leaning population of Chicago.4 Our brand will be focusing on the affordable and wide-reaching ad campaigns of the CTA (Chicago Transit Authority). According to the 2010 CTA market research, the majority of consistent CTA riders are younger, with 28% of riders falling in between sixteen and thirty years old, and more than 54% live within the city.5 We will also be taking advantage of the free platform of social media, focusing specifically on Instagram and recruiting brand ambassadors through the app. Brand ambassadors will receive free products once a month and will post pictures of the apparel with the company’s account tagged to increase awareness of the brand. They will be recruited using our account and will be compensated in product.

​Bebo, Victor. “Chicago, IL.” ​Data USA,​ Data Wheel. ​Bentle, Kyle. “In Illinois, Chicago-Area Clinton Votes Overtook Rest of State.” ​Chicagotribune.com,​ The Chicago Tribune, 9 Nov. 2016.

4 “​ ​Race and Ethnicity in Chicago, Illinois (City).” ​The Demographic Statistical Atlas of the United States - Statistical Atlas​, US Census Bureau.

5 ​O’Malley, Tara. “CTA Rider and Non-Rider Behavior and Attitudes Survey.” Chicago Transit Authority, Abt SRBI, 1 Sept. 2010.

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Triple Bottom Line As a company, we are committed to following the three principles of the Triple Bottom Line concept; people, planet and profit: People: We will be paying our workers a living wage, starting at $13/hour, and increasing with inflation and possible promotions or bonuses. We are committed to supporting our local community by hosting events such as open mics, hosting bands or singers, and by becoming a go-to place in the neighborhood where LGBT people, especially young adults, feel safe and comfortable.

Planet: The clothing industry is a large contributor to the world’s pollution. About 20% of the world’s water pollution stems from apparel making, and the amount of water used to make one cotton shirt (2,700 liters) is enough drinking water to sustain someone for two and a half years.6 By only selling second-hand and responsibly-sourced apparel, we will be cutting down on the stress to the environment,.

Profit: The resale and second-hand clothing markets are quickly growing. In 2018, 56 million women bought second-hand products, up from an estimated 44 million women in 2017.7 As shoppers become more environmentally and socially conscious, they are more open to seeking out shops and stores that provide products that benefit both the earth and the community, leading this to be a open and willing market.

Competition Ragstock: A second-hand and new apparel shop that has three locations in Chicago.

Ragstock is a generally popular store, though there are many aspects of the company that do not allow for maximum profit, likeability and customer support. First of these is the fact that their stores are often hard to navigate by section, and because their stores are larger, it can be difficult to find an employee to help. Though they are advertised as a second-hand shop, the majority of their product is new apparel and accessories which many more dedicated resale shoppers do not like. Triangle Exchange is committed to only selling new transitional apparel.

Buffalo Exchange: a second-hand clothing chain which has two locations in the Chicagoland area.

Buffalo Exchange will be perhaps our greatest competition, however there are many things that we can do differently. An average customer here will likely spend about $25 to $50 in one trip, which can be pricey for certain customers, especially younger shoppers. Triangle Exchange is committed to keeping prices low, with a cap placed at $40 per item.

​Drew, Deborah, and Genevieve Yehounme. “The Apparel Industry's Environmental Impact in 6 Graphics.” ​WRI.org​, World Resources Institute.

7 ​Reinhart, James. “2019 Fashion Resale Market and Trend Report.” ​ThredUP.com,​ ThreadUp. 6

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Partnerships The Center on Halsted (COH): The largest LGBT community center in the Midwest, based in Boystown, Chicago, IL. The Center on Halsted is an influential and well-recognized pillar of the Chicago LGBT community that could do a lot to raise the profile and help to improve Triangle Exchange. Much of our partnership is detailed in this ​partnership letter​, but opportunities would include hosting events, asking them to recommend us to consumers, and offering discounts to those who use services at the COH.

gcb2: A trans-owned and operated chest binder company that is widely considered the most comfortable and safest option for binding.

Because we are planning to sell transitional apparel for customers, gcb2 would be an ideal partner. They could offer Triangle Exchange discounted bulk rates for binders, and we could give a 10% commission on each piece that we sell. It is a serious problem for people who bind their chests that there are almost no places where you can try them on in-person. It can be extremely dangerous to bind if you are not wearing the correct size or fabric, so it will be a great opportunity to provide a place where people can safely try on options before commiting to one binder.

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Company Organization and Management Structure Job Descriptions Leader: Someone who is in charge of long-term company health and growth. This position will include the duties of: ● ● ● ●

Contacting potential partners Marketing and spreading word about events, sales, etc.

Hiring other positions such as Managers and Sales Associates Contacting outside contractors (Accountant)

Manager: Someone who is in charge of day-to-day operations, is well-versed in company policy and is the lead contact between the Leader and the Sales Associates. This position will include the duties of: ● ● ● ● ●

Assigning daily tasks for Sales Associates and making sure that they are completed Communicating with customers if there are any conflicts Contacting the Leader if there are any issues or concerns from staff Being a source for information about company policies and protocol Pricing new items and paying for apparel

Sales Associate: Someone who is in charge of contact with customers and keeping the store in order day-to-day. This position will include the duties of: ● ● ● ● ●

Opening/Closing the store Helping customers around the store (finding products, giving recommendations, etc.)

Sizing customers for transitional wear Organizing new products and keeping shelves/racks in order Checking customers out

Accountant/Human Resources: An outside contractor who will be hired to: ● ● ●

Complete taxes each year Keep payroll for all employees Write staff contracts

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Organizational Flow Chart

Operation’s Manual Following is a portion of a Sales Associate’s daily routine:Opening tasks: 1.

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Unlock front and back doors, turn on master lights and shelf lights.

Check for any packages, and/or phone messages.

Turn store sign to ‘Open’.

Put on name badge, go behind cashier desk and organize if needed.

When a customer comes in: 1.

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Say with a smile: “Welcome to Triangle Exchange, my name is _______, let me know if you need any help!

When a customer checks out, ask if they would like to donate a dollar to the Center on Halsted.

Ask if they have a rewards punch card. If they don’t: a. Ask if they would like one, and remind them that a rewards card means a 15% discount on every fifth purchase. b. If they ask for one, ask for their email and record it in the company computer.

Ask if they would like to purchase a paper bag for 7¢ Place the receipt and any event/promotional flyers into the bag or hand them to the customer with the folded and organized products.

Hand the bag to the customer, smile and say: “Thank you for coming today, see you again.”

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Accounting and Financial Information Reporting Financial reports will be sent out to the public every other quarter, and to stakeholders each quarter. As a social entrepreneur, I want to make sure that the public can be involved in the company as much or as little as they would like to be, and that anyone reading the reports can understand them. Doing so increases trust in the business, and makes it possible for new investors to get involved with less effort.

3-year Financial Projection Spreadsheet

Legal Structure This business will be registered as an LLC (Limited Liability Company). We wish to be a generally independent and smaller, local business but would like the legal structure and protection that a license offers. In Illinois, establishing an LLC costs $150, a relatively low price.8

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Thompson, Brian J. “Cost to Form Illinois LLC?” Brian Thompson Law, Brian Thompson, 7 Oct. 2013.

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Investing We are asking for an overall investment of $35,000. This investment will be used to: ● ● ● ● ●

Purchase initial inventory and pay employees Furnish the store and decorate to fit the brand Pay for rent, taxes and utilities Purchase a store sign and a business license Pay for marketing materials such as ads, pamphlets, business cards and bags

Risk Because apparel and merchandise can be acquired with little-to-no investment, this business is very low-risk. According to SmallBusiness.com, a thrift or second-hand store is essentially a recession proof business.9 When the economy is bad, people are more likely to shop at thrift shops. When the economy is good, people are much more likely to donate items to second-hand stores.

Incentives As an investor, you will receive a 25 percent share of the company. The original investment is expected to be received back after about three years and one quarter, which is when the investor would begin to make profit. Other benefits include: two votes (out of ten) in company decisions, a 50% discount on any merchandise purchased for the investor and two selected people, and a 5% increased ownership after 5 years.

In addition to financial incentives, there is a substantial social and emotional benefit to investing.

There are very few resources for LGBT people in Chicago, considering we have one of the largest populations in the country, and the amount of positive impact that I know this company will achieve is irreplaceable. Curating a safe, comfortable, welcoming place for people of all identities and backgrounds is the ultimate goal, and I believe Triangle Exchange is the ideal environment in which to achieve this . I know first hand the difference that a single, gender-affirming piece of clothing can do for a transgender or queer person, and being able to provide that for someone is truly a special experience.

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​Swanston, Brenna. "Thrift Stores & Average Income." Small Business - Chron.com. April 9 2019.