Business Strategies for Jewellery Store in Luton Mall - Example

Title: Fashion Store Business Plan Name Institution Executive Summary The report is a business plan for a Jewellery Store in Luton Mall. The business is a sole proprietor owned by a family and it is yet to be established. The mission of the business is to create a high reputation in terms of jewels sales in United Kingdom in the next two years. The store will offer jewellery products of broad categories both for men and women. These products (bangles, watches, necklaces, bracelets) are expected to be of high quality with modest design. The main supplier of the products will be Gecko Company since it has strong brands in the United Kingdom Market. Fashion Store is the name of the store to be established and the investment returns in the first year of operation are expected to be high. Business description of Fashion Store Mission statement Our mission is to sell jewelries of high quality to the customers coming to the mall in the United Kingdom. The Fashion store will enhance a good business relationship both to the owner and the employees for the success of the business in achieving its goals. 1. Planning Business description From the small research carried out by three members of the family, it was found that Luton Mall had only 5 business units selling jewelries. The family then decided to venture into the industry since the competition is low and the demands of the customers on the other side are high. The proposed Fashion Store will be located in the second floor of the mall, a unit just directly to the entrance door. Three of the successful jewelry stores on the first floor may be hardly seen by customers entering the mall because their units are someway unseen. Perhaps the demand of jewelry will continue rising since the festive season is approaching and most of the air travelers may pass by to buy gifts for their loved ones. The business is presently at developmental stage since the agreement between the stock suppliers and the owners has been reached. The business will sell both men and women products. Jewelry products will include necklaces, bracelets, earrings, bangles, wedding rings, watches, gemstone, pins, and pearls among others. The business will begin with about 800 different jewelry products and increase to 2000 in the next 9 months. The business has been set up as a sole but owned by the family. The reason behind the selection was that it is flexible at the same time tax liability is low compared to other large scale business. Startup Summary The start-up cost for the business will entails the following home-based equipment and furniture: License fee, Chairs and desk, Computer with CD writer and printer, Landline phone, Website creation fee Business Goal and Objectives The main goal of the business is to create a competitive environment that will lead to digital business operations. This will allow air travellers easy online access to the products the store is selling as well as location of the store in the mall. Objectives To extent the store in terms of space by April 2014, To contact global jewelry stores in order to learn of their experience on digital business operations by August 2014, To achieve positive investment returns on the first year of operation. Feasibility confirmation under the guidance of mission statement and objectives There is a gap in the delivery of jewelry to the customers around the mall in Luton. As stated before, five jewelry stores in the mall perhaps may not be enough to fully satisfy the customers in terms of quality and preference. Therefore, setting up fashion store will serve the industry at an expected demand. Digital business operations by the current players in the market have not been embraced yet. Therefore, coming up with such idea will enhance easy access to the store by the customers travelling as well as those within the market at the moment. To be successful in implementing these strategies, the business must gain good knowledge on digital marketing as well as integration of qualified human capital on business activities. 2. Human Resources Expected Workers Requirements Business Ownership Fashion Store is a sole proprietorship business owned by the family. The benefit of incorporation of personal liability in the business is of little concern since a group of family members bares this. The store will be run by the following staff: a) General Manager: The essential responsibilities of the manager is to support the daily operations and procedures of receiving stock from suppliers, ensures that customer services are held with business ethics, preparing invoices and bookkeeping, daily banking activities and analyzing daily sales of the store. The manager also ensures that regular training is conducted to equip employees with necessary knowledge in their respective fields. For an individual to qualify for this position (irrespective of whether he/she is a family member or not), he/she have knowledge on retail sales, ability to keep time, ability to communicate in English and ability to complete tasks alone if called upon. b) Sales Person: He or she will be the future of the company. Therefore the person in this position is expected to market the store products (jewelries), organize product delivery and promote the relationship between the business and the distributors. Also, a sales person will be expected to interpret market information to the business, collecting payments and making the sales of the store when it opens. The person that will occupy this position is expected to have good knowledge on marketing and sales, effective communication, computer literate and decent physical appearance. c) Jeweller: The person is expected to be cashing out items in the store as well as preparing daily bookkeeping. Also, he/she is responsible for stock taking process thus communicating to the general manager about the number of stock in the unit. The jeweler should be time keeper, computer literate and have knowledge on bookkeeping. Plan for employee retention Employee continuity will depend on the performance of the business and his/her duty undertaking. Since the unit will be operational for 24 hours a day, those in the night shift perhaps may have higher pay than those working during the day. It also depends on whether the sales goals of that particular day have been achieved. Regular training will be offered to the employees in order to enhance efficiency in handling daily operations of the business. Plans of operations The proposed Fashion Jewellery Shop will be supplied by Gecko Jewellery Group since it is the best wholesale group in the United Kingdom at the moment. It has good designed packing with branded range, fast delivery (it takes a maximum of 24 hours for goods to be delivered), it has online ordering system therefore it will reduce time and cost of travelling to the supplier and reliable franchises in the United Kingdom. The company has the leading customer service with free shipping on the stock of high value ordered. To enhance effective achievement of operations in the store the following tasks needs to be achieved; 1. Management of the store and administration: The general manger will ensure that tasks in the premises are delegated effectively to the workers. The duration of working hours is 24 hours therefore workers on shifts should keep time to avoid delay of service. The security as well should be embraced to avoid pilferage. The manager should ensure that every product received in the store is tagged for easy stock quantification. Arrangement and cleaning of store before a customer enters is a daily operation that needs to be emphasized to reduce disturbance at the time of sale. 2. Records management and display: A complete procedure of handling merchandises in the store should be documented. Inventories should be displayed correctly in order to attract customers coming to the store. Any complete sale should be recorded and a receipt issued to the customers and a copy retained. 3. Receipt management: The expected mode of receiving payment to the store is by cash and use of credit cards. The worker responsible for this should clearly understood how to swap credit cards and the procedure of collecting payments from the bank after card swap. 4. Customer service: This is an activity undertaken by everyone working in the store. It determines the future of the company in terms of sales. Every member of the store should be trained on how to handle a customer for example, during demonstration of a product. At the start, the store will need four sales persons but as the customers increase, more will be employed to enhance effective customer service. 5. Managing promotions: This is a marketing strategy of promoting the establishment of new store in the mall. Hiring of additional workers to do promotion on the first floor will be an effective way of letting the customers in to the store. SWOT Analysis Strengths The store will be supplied with fashionable jewelry that vary in color and size, Strong brands from supplier (Gecko Jewelry) will offer best quality to the customers, Website creation will allow easy access by the customers as well as cost reduction to the distributors, Expected digital marketing will raise sales for the business. Weaknesses Finding good workers for the start-up operations, Stock and customer demand maintenance, Opportunities Exhibitions around Luton Mall will over wider opportunity for the business to increase sales, Huge profit margins since the competitors in the mall are few, Fashionable jewelries, Increasing demand in United Kingdom market. Threats Competition, Economic slowdown in the United Kingdom, The initial state of the business in the industry. Availability of substitutes within the mall. Market analysis The store will target two groups of customers (Market segmentation): 1) End consumer: online contact through website interaction. Individuals can access the products online and can place order via the store’s website. 2) Galleries (Museums): Salespersons of the store needs to set up a good working relationship with galleries in order upscale store’s sales. The products (jewels) supplied to the galleries should be of high quality and with modest appearance. This will allow strong attraction of the galleries to the store thus increasing sales. Industry Analysis In order to reach the competitive edge, the store should take the following forms; One, the store should get supplies from the famous jewelry artists in United Kingdom since the product is made and sold under the manufacture’s large name. Customers will recognize the manufacture’s name through the store thus increasing the number of sales made. Two, the store would have internal designers such that they will reshape the product features to fit the customer’s choice of product design. Having successful knowledge of the industry, the store in the mall will have two advantages from customers’ patterns of buying; 1) Gift purchase: This happens when the customer finds the gift of someone in the store examines the design and purchases it. 2) Impulse buying: The nature of the jewels in the shop may look appealing and customer decides to purchase it without planning. Therefore, the store should be always appealing and equipped with almost all varieties of jewelry. Financial Forecast The graph below highlights gross profit margin (in £) of Fashion Jewelry Store for the first 12 months of operation; Gross profit at the beginning of operations perhaps may be low for the business. However, from the third month of operation, the customers are expected to have known the site of the store in the mall. This will be the turning point of the performance of the business at the initial stage of development. December will record highest returns on sales since the festive season is approaching and most of the customers will be looking for gifts for their loved ones. Profit and loss account 2013 2014 Sales £ 9850 £ 19, 250 Cost of sales £ 1,400 £ 2, 750 Gross Profit £ 7,450 £ 12, 720 Expenses Payroll £ 6900 £ 8020 Marketing expenses £ 1300 £ 300 Rent £ 0 £ 0 Taxes £ 1050 £ 1075 Insurance £ 300 £ 300 Total Operating Expenses £ 9550 £ 9695 Profit before tax & Interest (£ 2100) £ 3025 Taxes £ 0 £ 0 Interest £ 0 £ 820 Net profit (£ 2100) £ 2205 % Net profit -14.60% 15.20% Fashion Store Balance Sheet 2013 2014 Assets Current Assets Cash £ 820 £ 2011 Inventory £ 282 £ 420 Total current Assets £ 1102 £ 2431 Long-term assets £ 700 £ 700 Total Assets £ 1802 £ 3131 Liabilities Accounts Payable £ 400 £ 420 Total Liabilities £ 400 £ 420 Total Capital £ 1402 £ 2711 This implementation of the plan will be successful if the right resources are allocated for business operations stated. Luton Mall is well known in United Kingdom therefore the business expects high return in investment. It is the responsibility of the family to carry out any relevant operation that relate to development of the jewelry store. Reference Linsenman, C., & Kingaard, J. (2011) Start your own retail business and more: specialty food shop, gift shop, clothing store, kiosk (3rd ed.). Irvine, Calif.: Entrepreneur Press. Read More