Question:
Write an essay about the “Business Plan Strategy of a Sports Retail Store”.
“Sports Wear” is the men’s aerobic sports retailer that is located in Marina Square, 6 Raffles Boulevard, Singapore. Sports Wear should offer most comprehensive selection in Singapore. The retail shop provides with wide variety of male only clothing for the aerobic sports including of cycling, cross-country skiing, snowshoeing as well as running. The products are shorts, long and short sleeve shirts, tights, water repellant shells, socks as well as assorted fleece wears such as jackets, vests, gloves and pants. The mission of Sports Wear is to become a premium sports clothing retailer for the men. The vision of the business is to become one of the largest sports retailers in Singapore within five years. The aim of the business is to meet with the needs of the athletics as well as give them what they require. The objectives of the Sports Wear are:
Sports Wear participates in the retailing of the men’s clothing that is specially in the outdoor aerobic sports clothes position. The aerobic sports clothes have a market share of $766 million dollar business. The business is located in Marina Square, 6 Raffles Boulevard, Singapore, a sports minded town. The athletics are participated in number of activities. Based on its industry and market trends, the business is interested in starting small retail business that has broken new records over the last five years. Sports Wear has its market segment into two distinct segments. Firstly, it is hardcore athletes. The hardcore athletes are those who are living to push their body harder into the aerobic activities. Secondly, the market segment is the newbie, people those are new to the aerobic activities. Based on its market consideration, Sports Wear will focus on three of the major groups such as youthful parents with the children lively in the youth sports, college students as well as lively adults (Bhasin 2012). These are the groups those include of bulk of the athletes within the city; therefore, Sports Wear should dispose their income in order to spend on the athletic apparel.
Sports Wear faces competition from several competitors such as World of Sports, velocity Novena, Lai Sports and others. The hardcore athletes are going to the sports store to formulate a purchase. They use clothing so much that they understand with the technical features of the products. The newbie are those who make their purchases from the general stores as they have wide range of products as per their requirements.
Sports Wear is broken down into two of the market segments such as the hardcore athletes as well as the newbie. The targeted market customers are as follows:
Hardcore athletes: They are participating in two to three of various aerobic sport activities. These targeted customers are buying the latest from the market. As they are not requisite, more products as this group are mainly values the slight developments that the new products hold. Therefore, they are to get a part if the product demonstrates developments in plan over what they at currently buy.
Newbie: They have begun to get more serious within the aerobic activities. They are new to the aerobic activities. This group is more probable to create less frequent but they are the largest purchases. They are exciting as the business gives major impact to outfit these people.
Sports Wear builds personal as well as long-term relations with the customers to increase their market value and attract the customers at young ages (Mullins, Walker and Boyd 2012). By building a trust worthily relationship, they can maintain a family accurate up throughout the child’s university years.
The marketing strategies that Sports Wear employs to take into account of two different markets segments are that firstly they will market itself the hardcore group as to complete the resources of all various types of male sports clothing. In advertisement and promotion strategy, the Sports Wear uses magazine, journal advertisements to reach their customers. The company also participates in various competitors that the athletes use to participate in. In order to attract the hardcore athletes, the company sponsors the events wit handing out of the flyers. However, the marketing strategies for the newbie are dissimilar in addition to the advertising procedures as a total source of collection of clothing (Patanakul and Shenhar 2012). The company offers extraordinary advice from the sales group. It is attractive to the newbie that are receiving into various sports regarding the new activities. In order to attract the newbie, the Sports Wear relies on the advertisements within the local outdoor sports journals to reach out their targeted customers.
In sales and distribution strategy, the company sells the sports clothing directly to the customers (Terpstra, Foley and Sarathy 2012). Based on pricing strategy, the company tries to trade their products on the price basis using the assets power to trade their products at lowest price. The average price of the clothing for the aerobic sports is $7.00 that should be attractive to hardcore athletes and newbie.
Using the concept of the Ansoff’s Matrix, the business can develop their market and product by lowering the cost of the products by which the organization can increase their profitability (Porter and Tanner 2012). Sports Wear uses the market penetration to sell their clothes into the existing markets by increasing the promotion. It also helps in brand development.
Key operating activities
The business is located in Marina Square, 6 Raffles Boulevard, Singapore. The operating activities of Sports Wear are production, sales as well as delivery to the customers. By offering knowledgeable support staffs, Sports Wear should quickly gain a good market share in the upcoming years. The Sports Wear operates in two of the market segments for their buying patterns (Sorensen 2012). Firstly, the hardcore athletes are most specific to the sport clothing. Secondly, the newbie are those who are new to these activities. The newbie groups are exciting in buy of the aerobic activities as it allows the Sports Wear to have an impact on outfitting of those people.
Partnerships
In order to start up a new business, the Sports Wear should require doing partnerships with the World of Sports, so that they can increase their productivity in Singapore.
Business controls
Marketing of the sports clothes are designed to persuade the customers to buy their products as well as invest in their services. The business control of Sports Wear is to monitor the feedback of the customers through surveys as well as polls. It helps to identify the satisfaction level of the customers by hosting the online polls on the internet (Zikmund et al. 2012). There is also required to monitor the marketing budget such as travel expenses, cost of the market research etc.
Intellectual Property Issues
Sports Wear has no such trade name, trademarks as well as domain names that help to differentiate their products from its competitors (Barbera et al. 2012). These are the intellectual property issues that the new business faces. Therefore, the business requires proposing those in their operational plan.
Scalability
The business requires more investors to start their business. They require building a new business model that should be attractive to the investors so that they invest more in the business. The business requires building a strong team to take out of the critical path (Whittington et al. 2016).
Key people, their functions and background
Business Organizational structure
Figure 1: Organizational Structure of Sports Wear
Skills saps and plans to fill them
Stan William will begin their operations with a small team with an intension to raise their business. Planned to begin with full time employee will be a store manager. The store manager should work intimately with the owner. The personnel plan is to hire 5 full time employees at the start up of the business (Wulf and Butel 2016). Part time employees are also hired in order to manage approximately 140 hours of the operations per week. Additional hires are devoted to the expansion of the buying functions, which will help to increase the operations of the private functions.
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Resources requirements |
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1 |
Premises and facilities |
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Storage space, shopfront, showroom, manufacturing facilities |
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2 |
Machinery and equipments |
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Cash registers, store furniture, work benches, production machinery, computer hardware and software, databases |
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3 |
Staffs |
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5 more full time Employees, store manager, contractors |
In order to start up the new business of Sports Wear, the usual source of funding the bank loan.
Founder’s contribution
The founder of the Sports Wear is the Director, Stan William who brings product ideas. The person also brings capital for the business.
Loan and equity finance requirements
Funding is the equity finance requirements to lender the equity interest within the company (Saha 2015). It accounts for 2% of the annual revenue increase for the five years. It will attract the funding of the type of the tend that have the possibilities of growth of the business.
Leverage
There are three of the steps that are used to create leverage within the business operations of Sports Wear are that the sales representatives devote on the average only to one-third of the day within the prospects. The allocation of the staffs, store manager, meetings as well as other valuable activities require more individuals to go from 30 percent to 50 percent with efforts. The main goal is to maximize the results with fewer amounts of efforts.
Time scale and exit routes for equity investors
Venture capital is to be given by the bank. The funding is the shape of the equity. The venture capital are required a big return from the investors as well as exits their routes for the equity investors for around 3-5 years.
Sports Wear will observe the financial statements as they have a straight correlation with the physical condition of the business. In the future, it is forecasted that in the future the retail sector will grow moderately. All the sales of the sports clothes are to be in cash leading to positive cash flows, and the acquisition of the asset is to be maintained. Profits is reinvested in the business for hope towards the expansion of the products as well as store (Refer to Appendix)
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Identification of the risks |
Risk monitoring and mitigation |
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Financial risk: There is a lack of funding for the start up of the business. |
Before the plan of the start-up business, the project sponsor should collect the funds from other organizations (Batova and Andersen 2016). Even estimation of the budget before the launching of the store is required. |
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Resource risk: There is lack of resources to start up of the business. There are lack of employees as well as there is no store manager to manage the entire store. |
The management team of the business should recruit a store manager for their business. Even 5 other full time employees are also required (Qureshi, Saeed and Wasti 2016). It should be done before the plan of the start-up. |
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Management risk: There is lack of management support. The assistant managers of the sports store are not giving the enough support to the staffs in their buying process (Chang 2016). |
The management team should support all the employees in their work. The management should take care of their requirements as well as needs. |
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Product risk: There is lack of sports clothes in the store. Due to growing in the market, the store is not able to store more products in their store. Therefore, the customers are not getting the required sports clothes at all the time (Myrna 2012). |
The products should be always available within the store. The store should have a data warehouse where the products should be stored and it should be presented whenever it is required (Tiscini and Raoli 2013). |
Critical Success Factors
The critical success factor for the start-up business of Sports Wear is to start the selling unit with a gross margin of 50 percent and the business should require a continuous product improvement. The other success factors are that the business should need money in order to build inventory and require a sales and marketing operations in order to drive the business (Mullins 2012).
Strategic Options
The Sports Wear works on two of the strategic options. Firstly, it is the differentiation of the products (Chang 2016). It helps them to give their customers more what they want as well as it boosts their willingness of the customers to pay for the sports clothes. Secondly, Sports Wear serves with a low cost producer. The business charges the lowest price of their products within the industry.
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Milestone |
Due Date |
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Initial contributions of the capital |
1st June 2016 |
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Completion of the prototype |
8th June 2016 |
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Formalization of the partnerships |
18th June 2016 |
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Securing of the key customers |
27th June 2016 |
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Initial content of the localization completed |
30th June 2016 |
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Resource planning |
4th July 2016 |
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Recruitment of the full time employees |
15th July 2016 |
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Sustainability as well as profitability |
20th July 2016 |
References
Barbera, L., Crespo, A., Viveros, P. and Stegmaier, R., 2012. Advanced model for maintenance management in a continuous improvement cycle: integration into the business strategy. International Journal of System Assurance Engineering and Management, 3(1), pp.47-63.
Batova, T. and Andersen, R., 2016. Introduction to the Special Issue: Content Strategy—A Unifying Vision. IEEE Transactions on Professional Communication, 59(1), pp.2-6.
Bhasin, S., 2012. An appropriate change strategy for lean success.Management Decision, 50(3), pp.439-458.
Chang, M., 2016. Entrepreneurship your business plan. IEEE Engineering Management Review, 44(1), pp.21-23.
Chang, W.L., 2016. Online training for business plan writing through the World Café method: the roles of leadership and trust. Universal Access in the Information Society, pp.1-12.
Mullins, J., 2012. PLAN B: RE-THINKING FUNDING. Business Strategy Review, 23(4), pp.47-49.
Mullins, J., Walker, O.C. and Boyd Jr, H.W., 2012. Marketing management: A strategic decision-making approach. McGraw-Hill Higher Education.
Myrna, J., 2012. A rolling stone gathers no moss: prevent your strategic plan from stagnating. Business Strategy Series, 13(3), pp.136-142.
Patanakul, P. and Shenhar, A.J., 2012. What project strategy really is: The fundamental building block in strategic project management. Project Management Journal, 43(1), pp.4-20.
Porter, L. and Tanner, S. eds., 2012. Assessing business excellence. Routledge.
Qureshi, M.S., Saeed, S. and Wasti, S.W.M., 2016. The impact of various entrepreneurial interventions during the business plan competition on the entrepreneur identity aspirations of participants. Journal of Global Entrepreneurship Research, 6(1), pp.1-18.
Saha, B., 2015. Curators Plan To Business Ethical Dilemma-A Roadmap To Handle Ethical Behavior Of The Business Organizations. Scholedge International Journal of Business Policy & Governance ISSN 2394-3351,2(6), pp.1-4.
Sørensen, H.E., 2012. Business Development: a market-oriented perspective. John Wiley & Sons Ltd.
Terpstra, V., Foley, J. and Sarathy, R., 2012. International marketing. Naper Press.
Tiscini, R. and Raoli, E., 2013. Stock option plan practices in family firms: The idiosyncratic private benefits approach. Journal of Family Business Strategy, 4(2), pp.93-105.
Whittington, R., Yakis-Douglas, B., Ahn, K. and Cailluet, L., 2016. Strategic Planners in More Turbulent Times: The Changing Job Characteristics of Strategy Professionals, 1960–2003. Long Range Planning.
Wulf, A. and Butel, L., 2016. Knowledge Sharing and Innovative Corporate Strategies in Collaborative Relationships: The Potential of Open Strategy in Business Ecosystems. In Decision Support Systems VI-Addressing Sustainability and Societal Challenges (pp. 165-181). Springer International Publishing.
Zikmund, W., Babin, B., Carr, J. and Griffin, M., 2012. Business research methods. Cengage Learning.
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