MY STUDENT RESEARCH



center144145DESIGNS BYKEN00DESIGNS BYKENPHASE 4 INDIVIDUAL PROJECTKENNETH C HOLMESENTR615-1504B-01PROFESSOR THERESA PAVONEDECEMBER 14, 2015DESIGNS BY KEN PRELIMINARY BUSINESS PLANExecutive Summary:The life of urban man is so hectic. With a daily schedule full of business meetings and deadlines, and an active social life filled with sporting events and outdoor activities, concerts, the club scene, dating, and hanging out with friends, it is no wonder men have so little time to tend to their fashion needs. This is where Designs by Ken comes to the rescue. Designs by Ken is an online men’s wear store that offers a variety of apparel options to fit today’s man’s professional and casual needs, and makes the process convenient and fast. 1.1 Mission Statement:The Designs by Ken mission is simple, provide the urban man with apparel options that are current, trendy, and meet his apparel needs, and make the process simple and quick. 1.2 Keys to success:Provide a website that is easy to access, navigate, enticing, and provides current and trendy apparel options that fit the urban man’s lifestyle.Provide links to partner apparel websites that offer accessories, socks and underwear, and shoes, to provide the total look. Maintain a strong and positive relationship with the clothing manufacturer, investors and partner websites to encourage and foster a collaborative team environment. Establish and maintain an organized operational structure that fosters fast and reliable product production, delivery to warehouse, and online shipping and delivery to the customer.Establish and maintain a solid advertising strategy that promotes Designs and Ken, and entices the target consumer to purchase the product.Establish and maintain a strong professional relationship with entertainment and athletic industry leaders to create sponsorship and media attention.Vision Statement:My vision for Designs by Ken is to start with a website that carries a small collection of professional and casual men’s apparel, and expand the collection and business as visibility and revenues grow. Ultimately, I want to open a Designs by Ken store in West Hollywood, and carry a full collection of men’s apparel, and dress today’s man from head to toe. Additionally, I want to see Designs by Ken apparel in major department stores and private men’s pany Summary:Designs by Ken will offer the urban man fashions that are current, on trend and creative, that will meet the needs of the busy working urban man. Kenneth Holmes and his team will maintain an efficient and cost effective system that ensures merchandise is promptly received from the manufacturer, and quickly shipped to the customer. Additionally, Designs by Ken will maintain a strong focus on marketing to our target consumer, in all major metropolitan areas across the U.S. The marketing strategy will focus on national and regional publications, internet advertising, trunk shows to obtain department store and men’s shop accounts, fashion shows to increase consumer awareness of the online store and product, and athletic and entertainment venues will be utilized to sponsor industry events.2.1 Company ownership:Designs by Ken will be a partnership which includes: Kenneth C Holmes, Owner, manager and Designer.Investors, Business Partner, Financier, Designer and Collection Advisor.Production Company, Design and Collection Advisor.All parties will work together as a team to create product that meets the target consumer’s needs, and encourages and promotes the growth of Designs by Ken. 2.2 Type of organization:Designs by Ken will be registered as an LLC (Limited Liability Corporation). This type of entity will provide personal property and assets protection from business debts and litigation, will tax business profits and losses as owner’s personal income on my tax return, provides all the protections of a corporation without double taxation, and is simple and inexpensive to form. 2.3 Statement of Ethics: To ensure best business practices are applied to all transactions, a Code of Conduct and Ethics will be assembled and provided to all employees, the investors and clients, and will be enforced to ensure full compliance with all legal, ethical, and professional standards, as well as ensuring a strong ethical standing in the business and consumer community. 2.4 Statement of Social Responsibility: Designs by Ken is a proponents of the environment and preserving our planet for future generations. The result is a shipping and packaging program that only uses 100% recycled plastic and cardboard, and full participation in the local Los Angeles recycling program. Designs by Ken is also involved in local functions including fashion shows and benefits that raise funds for local foundations, and the annual West Hollywood Halloween Carnaval, which is the largest street party in the world, it takes place on October 31st, and hosts 500,000 participants. 2.5 Startup Summary:Designs by Ken startup cost will include: production cost of product inventory, monthly rental of warehouse space, set up of electric and phone utilities, LLC registration and state fees, payroll for staffing, setup of office with equipment, software and supplies, creation and maintenance of the website and social media service, setup and configuration of print and radio advertising service, packaging and shipping costs of online orders. While state and federal grants will be sought to enable growth and stability, the sum I am seeking to launch Designs by Ken will be $225,000.PRODUCT COST FOR START-UP LINEProductCost EachQuantityTotalNo-iron cotton long sleeve solid dress shirts$10500$5,000No-iron cotton long sleeve animal print casual shirts$15400$6,000Polyester long sleeve shimmer shirts$10500$5,000Poly/cotton blend slacks$10500$5,000Stretch Slim Denim$10500$5,000Stretch Straight leg Denim$10500$5,000Stretch Loose fit Denim$10500$5,000Total Cost?3400$36,000DESIGNS BY KEN: START-UP COSTS AND REQUIRED INVESTMENTInitial inventory production cost$36,000Warehouse rent for one year$16,200Full service website setup and advertising$8,200Radio and Print Advertising$1,200Customer order supplies and shipping?Office furniture and Equipment$1,400Quick Books Pro$200Warehouse Phone and Electric Service$3,120Liability Insurance$1,200LLC registration $400Additional required cash investment$157,080Total Start-up Costs:$225,000Products:Designs by Ken will offer the urban male styles that are creative and traditional, clean lined, with soft and comfortable fabrics, in season-less and seasonal colors, that easily transition from professional to evening including: 100% no-iron cotton, button down dress shirts, in a variety of solids and patterns.100% no-iron cotton, button down casual shirts, in a variety of creative prints. 100% polyester button down shirting, in a variety of shimmering colors. 50/50 cotton/poly blend dress pants, in traditional colors.Stretch denim, in slim fit, straight leg and loose fit, and available in dark indigo, vintage and black. Shirt sizing from SMALL to XXL.Pant sizing from waist 28 to 42, with inseams from 30 to 36.Additional style and colors will be added based on season, fabrication and color availability, and customer request including: 100% no-iron cotton, button down short sleeve dress shirts, in seasonal colors for spring and summer. Short sleeve casual shirts, in festive colors, patterns and prints, for spring and summer. 100% cotton twill Shorts in seasonal and all season colors.100% cotton denim shorts in Dark Indigo, Vintage, Black and White. As Designs by Ken grows, the plan is to expand the collection and include underwear, accessories, pullover shirts, vests, blazers and jackets. Prices currently range from $50 to $100, and new item prices will be based on type of garment and fabrication. 3.1 Production and distribution chain:Designs by Ken will use the direct to retailer chain of distribution (manufacturer to Designs by Ken to the customer).The production house (ARGYLE Haus of Apparel or Indie Source) will handle production from start to finish, by using their full service package.All supply sources and services are 100% U.S. based.Finished product will be shipped from the manufacturer to my local warehouse.My warehouse will be used for receiving and storing finished product, reviewing and printing online orders, and shipping customer orders.Customer orders will be shipped from my warehouse by USPS and UPS to the customer.Domestic orders of $100 and up will be shipped free by the USPS, all other orders will be charged to customer, and shipped by the USPS or UPS.3.2 Product Shipping:Designs by Ken will use USPS for domestic orders and UPS for international shipping. Domestic orders $100 and more will ship for free, express shipping is available for $15. All other domestic and international shipping will be charged to customer.3.3 Location: The location of both the manufacturer and the warehouse is Los Angeles. Los Angeles provides a regional base for manufacturing, easy communication between Designs by Ken and the manufacturer, convenient warehousing and shipping to anywhere in the U.S., and around the world. Additionally, it provides an ideal city for making entertainment and athletic industry connections, and the possibility of a Designs by Ken retail shop. Market Analysis Summary:The men’s wear industry is of global proportion, and each year new manufacturers and designers from across the globe enter the marketplace, making competition for the consumer’s disposable income intense. With increased competition and difficult global time, industry leaders must adapt to maintain their global position. This is done by: utilizing intensive advertising and public relations strategies to maintain their position, build consumer loyalty, and compete with new competition; and by following fabrication and color changes, adopting new styles based on consumer lifestyle and status, and by staying on top of trends CITATION Lew15 \l 1033 (Pearson, 2015). For 2010, the men’s wear industry generated revenues of over $402 billion, reflecting growth of 14% over five years. Apparel and footwear represent 60% of the total market, and denim generating over $115 billion, with increased demand for premium denim, and reduced demand for low priced denim at just below $3 billion. Revenues of outerwear rose, with pants, shorts and shirting showing the highest volume. Neckwear generated $413 million in revenues, and a 26% gross profit. Suiting represented 35% of total revenues, with reduced revenues because of higher unemployment and less disposable income. Canada, South America, and the United States had the largest markets, representing 35% of global revenues CITATION Lew15 \l 1033 (Pearson, 2015). For 2014, China’s had the fastest growth of the top five developing nations, with $78 billion in industry revenues. The UK experienced a revenue increase of 5%, and continues to maintain strong sales CITATION Lew15 \l 1033 (Pearson, 2015). The men’s wear industry is expected to continue growing, and for apparel producers to maintain their customer base, they will have to use aggressive and targeted advertising, differentiate their collections from the competition’s, and potentially combine tactics to maintain and strengthen their position and market share CITATION Lew15 \l 1033 (Pearson, 2015). 4.1 Industry competition:The men’s wear industry has many major players. The designers and online retailers that I will be competing with include:53041551524000Ralph Lauren: A U.S. based designer whose apparel appeals to the sophisticated male and female consumer. His collection includes men’s wear, women’s wear, children’s wear, the Ralph Lauren Purple Label for men, home fashions, hosiery for men and women, and fragrances. Ralph Lauren has an international presence, with his collection found in department stores, Ralph Lauren stores around the world, and Ralph . 451739014097000Calvin Klein: A U.S. based designer whose apparel appeals to male and female consumer who likes clean lined, simple, chic and season-less clothing, that easily transition from professional to evening, and coordinates with many garments. His collection includes men’s and women’s sportswear, couture and denim, and licensed products including: men’s sportswear, outerwear, accessories, lingerie, men’s and women’s hosiery, swimwear, eyewear, furs, and fragrances. He has an international presence, with his collection found in department stores, Calvin Klein stores around the world and Calvin . 52863758890000Perry Ellis: A U.S. based designer whose apparel appeals to the male consumer who likes styles, colors and patterns that defy tradition, are loose fitting, and stylish for today’s man. He has an international presence, and his collection is found in department stores, Perry Ellis stores around the world, and Perry : Is an online men’s clothing store that provides men membership and a personal stylist. Your stylist chooses product based on your size, style and budget, or you can make their own selection. They make product selection, purchasing, and return convenient and simple, and send product on a monthly basis, unless cancelled by the member. They offer product from many reputable labels, a full collection of head to toe styling that is classic, casual, preppy and hipster, prices range from $69 to $200, and regular shipping is always free. : Topman is a UK based men’s wear retailer, has over 400 stores around the world, as well as their own website. Topman features their own label, as well as up and coming British designers, and will dress the customer from head to toe with chic and casual, dressy and professional apparel. They offer an in-store personal stylist, and free standard shipping. Their prices range from under $10 up to $500, and they provide students a 10% discount. 3048000281305004.2 Target market:The Design by Ken target consumer is the U.S. based urban male with an annual income of $40,000 and up, age 25 to 45, will potentially attract ages 20 to 24 and 46 to 50, is single or married, urban and suburbia, lives in warm and cold climates, enjoys an active social life, does not like to shop, or does not have time to shop, and has good taste and style. In a nutshell, he is “The confident and well-dressed urban man, who know what he likes, and expects high quality for a fair price”.The chart data indicates: there are 11.74 million men age 20 to 24, 11.16 million men age 25 to 29, 10.81 million men age 30 to 34, 9.94 million men age 35 to 39, 10.22 million men age 40 to 44, and 10.35 million men age 45 to 49. These figures indicate there are 42.13 million men age 25 to 44, and another 22.09 million men age 25 to 29 and 45 to 49, totaling 64.22 million potential male customers. right26670DESIGNS BYKEN00DESIGNS BYKEN4.3 Slogan and Logo:The slogan is “Apparel for the confident and well-dressed man”The Logo is: 4.4 Strategy and Implementation Summary:Designs by Ken will apply the following media outlets: Extensive internet advertising on websites specifically geared for men, and social media sites including Facebook and Twitter. National magazines including GQ, Esquire and Men’s Health, to gain national attention.Radio advertising in major metropolitan areas, to gain regional attention in major metropolitan areas.Entertainment production company and celebrity endorsements as they occur.Trunk shows at major department stores and private men’s shops, to gain a retail presence. 4.5 Niche Marketing:Designs by Ken uses the niche marketing approach, because the collection caters to the urban male, age 25 to 45, with an income of $40,000 and up. 4.6 Competitive advantage:Designs by Ken will offer the urban man a website that is easy to navigate and purchase, helps him find the right look for professional and casual apparel that fits his budget of time and money, convenient delivery options, and will not break the bank. Designs by Ken focuses on the 25 to 45 year, young man, but will also appeal to ages 20 to 24 and 46 to 50 man. Additionally, the collection provides options that make a statement that says “I am a confident and well-dressed man”.Management Summary:Kenneth Holmes will be responsible for daily operations, and the design and product decisions will be a coalition between Kenneth Holmes, the investors, and the manufacturer. Kenneth Holmes has over 30 years in the retail industry, and a Fashion Design degree from the Art Institute of Fort Lauderdale. The venture capital group has expertise in the field of fashion design and marketing, and the manufacturer has expertise in the field of fashion design, trend research, distribution and marketing. The combined forces of the three will provide enormous input and decision making to produce the best product for the line, drive sales and success.5.1 Personnel Plan:Designs by Ken will start with a staff of two:Kenneth C Holmes, Manager, Staff Coordinator and Designer. One warehouse coordinator, handle receiving orders from the manufacturer, and process online orders.Starting with one warehouse employee, and adding based on sales and time scheduling. Designs by Ken Why: Since I studied Fashion Design at the Art Institute of Fort Lauderdale, it has been my dream to create a men’s wear collection that addresses the needs of the urban man, as well as my own. It comes as no surprise that many products on the market today are the result of research to solve a problem the creator had, only to find out that many people across the country have the same problem. Designs by Ken will solve both, fashions that appeal to myself and urban men across the country.Designs by Ken will also introduce a new competitor to the marketplace, provide better quality product completely sourced and manufactured in the U.S.A., provide the urban male creative options at affordable pricing, the ability to add new products quickly, quick and affordable delivery, quick replenishment, and excellent service. Projected First year financial statements:DESIGNS BY KEN BALANCE SHEET: PROJECTION FOR 2016ASSETSQuarter 1Quarter 2Quarter 3Quarter 4CURRENT ASSETS????Cash$141,324$141,495$168,354$193,923Accounts Receivable$0$0$0$0Inventory$26,000$31,000$42,000$39,000Prepaid Expenses$6,250$6,330$6,475$6,830Notes Receivable$0$0$0$0Short-term CD$100,000$140,000$150,000$200,000TOTAL CURRENT ASSETS$273,574$318,825$366,829$439,753FIXED ASSETS????Long-Term Investments$0$0$0$0Land$0$0$0$0Building$0$0$0$0Accumulated Depreciation$0$0$0$0Machinery and Equipment$1,100$1,100$1,100$1,100Accumulated Depreciation$0$0$0$0Furniture and Fixtures$500$500$500$500Accumulated Depreciation$0$0$0$0Other Fixed Assets$0$0$0$0NET FIXED ASSETS$1,600$1,600$1,600$1,600OTHER ASSETS????Goodwill$0$0$0$0TOTAL ASSETS$275,174$320,425$368,429$441,353LIABILITIES????CURRENT LIABILITIES????Accounts Payable$0$0$0$0Accrued Wages$4,800$9,600$9,600$9,600Accrued Payroll Taxes$0$0$0$0Interest Payable$1,125$1,125$1,125$1,125Short-Term Notes$0$0$0$0Current Portion of Long-Term Debts$11,250$11,250$11,250$11,250TOTAL CURRENT LIABILITIES$17,175$21,975$21,975$21,975LONG-TERM LIABILITIES????Mortgage$0 $0$0$0Other Long-Term Liabilities$180,000 $180,000 $180,000 $180,000 TOTAL LONG-TERM LIABILITIES$180,000 $180,000 $180,000 $180,000 TOTAL LIABILITIES$197,175 $201,975 $201,975 $201,975 OWNERS EQUITY????Paid In Capital$19,175 $40,100$60,100$80,100Net Income$58,824 $78,350$106,354$159,278TOTAL EQUITY$77,999 $118,450 $166,454 $239,378 TOTAL LIABILITY AND EQUITY$275,174 $320,425 $368,429 $441,353 DESIGNS BY KEN INCOME STATEMENT: PROJECTIONS FOR 2016CategoryQuarter 1Quarter 2Quarter 3Quarter 4Revenue$129,000$155,000$200,000$310,000Expenses????Product Cost$36,000$30,000$36,000$72,000Warehouse Rent$4,050$4,050$4,050$4,050Website and Social Media$300$300$300$300Radio and Print Advertising $300$300$300$300Free Shipping Expense$420$500$645$1,000Office Equipment$400$400$400$400Electric and Phone$780$780$780$780Quick Books Pro$50$50$50$50Liability Insurance$300$300$300$300Payroll$4,800$9,600$9,600$9,600LLC Registration Fees$100$100$100$100Total Expenses$47,500$46,380$52,525$88,880Gross Income$81,500$108,620$147,475$221,120Tax Rate 28%$22,820$30,414$41,293$61,914NET INCOME$58,680$78,206$106,182$159,206DESIGNS BY KEN CASH FLOW STATEMENT: PROJECTIONS FOR 2016Fiscal Year Begins January 1, 2016 Pre StartupQuarter 1Quarter 2Quarter 3Quarter 4Cash on hand (Period Start)$225,000$216,000$275,575$360,270$482,820Cash Receipts$0$0$0$0$0Cash Sales$0$0$0$0$0Collection from CR accounts$0$129,000$155,000$200,000$310,000Loan/other cash injections$0$0$0$0$0Total$0$129,000$155,000$200,000$310,000Total Cash Available Before Cash Out$225,000$345,000$430,575$560,270$792,820??????Cash Paid Out?????Purchases Inventory$0$36,000$30,000$36,000$72,000Office Equipment$1,100$0$0$0$0Office furniture and fixtures$500$0$0$0$0Gross Wages (Exact Withdrawal)$0$4,800$9,600$9,600$9,600Repairs and Maintenance$0$0$0$0$0Website maintenance and advertising$0$300$300$300$300Radio and Print advertising$0$300$300$300$300Car, delivery and travel$0$100$100$100$100Accounting and Legal$400$0$0$0$0Rent$0$4,050$4,050$4,050$4,050Telephone$0$330$330$330$330Electric$0$450$450$450$450Liability Insurance$0$300$300$300$300Taxes$0$0$0$0$0Interest$0$1,125$1,125$1,125$1,125Free customer shipping $0$420$500$645$1,000Cost of website setup$7,000$0$0$0$0Total$9,000$48,175$47,055$53,200$89,555??????Cash Paid Out (non P & L)?????Loan Principal Payment$0$11,250$11,250$11,250$11,250Capital Purchases$0$0$0$0$0Other Start-up Costs$0$0$0$0$0Reserve and Escrow$0$0$0$0$0Owners Income$0$10,000$12,000$13,000$15,000Total$0$21,250$23,250$24,250$26,250Total Cash Paid Out$9,000$69,425$70,305$77,450$115,805??????Cash Position End of quarter$216,000$275,575$360,270$482,820$677,015(All financial based on estimates, results will likely vary)Performance standards applied: Appropriate performance measures will be applied to ensure Designs by Ken performs to expectations, meets the requirements established by contract with the investor, meets the needs of the target consumer, and in the process enables the growth of the business.REFERENCES BIBLIOGRAPHY \l 1033 Gaebler, K. (2015). LLC Advantages and Disadvantages. Retrieved from : ? … ? Forming a Legal Entity ? LLCsN.A. (2015). British Mens Fashion. Retrieved from Topman: N.A. (2015). Calvin Klein biography. Retrieved from Encyclopedia of World biography: ? Ki-LoN.A. (2015). Perry Ellis Biography. Retrieved from bio: people/perry-ellis-20686321N.A. (2015). Ralph Lauren Biography. Retrieved from bio: people/ralph-lauren-9374814N.A. (2015). The Monthly Clothing Service Entirely For Men. Retrieved from Bombfell: N.A. (2015). United States of America Population 2015 . Retrieved from Pyramids of the World from 1950 to 2100: O'connell, B. (2015). Pros and cons of venture capital and angel investing. Retrieved from : emed/pros-and-cons-of-venture-and-angel...Pearson, L. (2015). Global Men’s Clothing Industry Analysis. Retrieved from Report Linker: ci02122/Men-s-Clothing.html ................
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