Ban Ke Hoach Kinh Doanh

A Business Plan for Inner City Apparel Retail Providing the Latest in Hip Hop and Urban Fashions
December 5, 2002
Executive Summary
Image Fashions is a retailing concept that addresses an unmet demand and it will target a profitable emerging
market that is affluent, accessible and trend setting. This market is Americas inner city, and, in Chicago alone,
there is an estimated gap of $631M between demand and supply. To fill a portion of this gap, Image Fashions
will provide the latest in high-end urban and hip-hop apparel to ethnic groups and minorities on the Southside of
Chicago.
Historically, retailers have avoided the inner city because of perceived characteristics, whether founded or
unfounded, and poor statistical information. Statistically, retailers have relied exclusively on per capita income to
determine the purchasing power of neighborhoods; hence most retailers have focused on the wealthy Northside
of Chicago and the suburbs. However, this metric ignores the competitive advantages of the inner city,
specifically population density, spending patterns and ethnic diversity. When these factors are accounted for, the
retail purchasing power of the Southside inner city is comparable to any location in Chicago.
Image Fashions primary market is the African Americans and Hispanics between 12-34 years of age who
populate these neighborhoods. This population is very fashion conscious and, on average, spends 30% more on
apparel then their white counterparts. They view their clothes as an expression of their personality and a
statement of their connection to the latest icons and popular trends. However, it is very difficult for this group to
purchase fashionable clothes. Typically, they must spend an hour or more on public transportation to go to
Michigan Avenue. Once there, they may have difficulty finding ethnic brands, or they are shadowed by security,
who automatically assume they will steal something. Image Fashions will offer these fashionable products, but it
will offer these products in a professional and respectful manner in the customers neighborhoods.
Image Fashions, with its professional management team, has identified a 5 mile radius that spends approximately
$220M annually on apparel and has very little competition. By capturing a small percentage of this value, Image
Fashions will be one of the most profitable apparel retailers in the United States.
Image Fashions will capture
1.4%, or $3.0M, of this markets gross revenue, and will deliver the Net Income highlighted in this Revenue
Summary.
Image Fashions, LLC
Revenue Summary
(in $000's)
Year 1
Year 2
Year 3
Year 4
Year 5
Net Revenue
793.9
2,415.3 $
2,855.5 $
3,001.6
3,155.1
Cost of Goods Solds
381.8
1,161.6 $
1,373.3 $
1,443.5
1,517.4
412.1
1,253.7 $
1,482.2 $
1,558.0
1,637.7
508.3
637.4 $
681.0 $
703.5
727.5
(101.0) $
611.5 $
796.4 $
849.8
905.5
321.4 $
384.8 $
394.7
404.5
(196.7) $
290.1 $
411.6 $
455.1
500.9
Gross Income
Operating Expenses
Net Income from Operations
Other (Income) or Expenses
Net Income
$
$
$
$
95.7
Image Fashions will capture this market share and be fully operational within 18 months of opening by
accomplishing 3 goals. First, Image Fashions will be tailored to meet the needs of the local customer. Image
Fashions will offer products and labels that are not traditionally carried by department stores. It will carry brands
from designers, suc h as Sean John, Phat Farm, FUBU and Coogi. These labels, often developed by hip- hop
entertainers, are appealing to the market, and they allow the wearer to be associated with their favorite icons.
To ensure the proper mix of products and labels, Image Fashions will hire a buyer with experience in this market
and hire sales associates from the target market. By hiring students from the target market as sales associates,
they can aid the buyer in determining the latest trends and most fashionable clothing.
Second, Image Fashions will focus on operational excellence. Image Fashions will provide a service orientated
shopping experience that will allow customers to be treated with respect while purchasing their favorite labels
2
within their neighborhoods. The store will be trendy, clean and well lit. The staff will be professional and
courteous, and the store policy will reinforce the value of the customer and the experience. While security and
shrink are issues, Image Fashions will focus on containing the few problem elements, rather then assuming all
customers and employees are potential problems.
The third factor for Image Fashions is commitment and leadership within the community. Image Fashions will
create jobs and be an active participant in the community. It will host graduation and community events, and
this involvement will allow Image Fashions to demonstrate its sincere commitment to the community while
building its own brand and identifying new fashion trends.
Image Fashions has also studied other markets and expansion opportunities. It plans on opening other stores in
second tier cities, such as Pittsburgh, Detroit, Atlanta and Miami, where the target customers of Image Fashion
are underserved.
The management team is formed with a variety of complimentary skills. They have functional experience in
finance, marketing, operations, sales and strategy, and they also have domain experience in apparel, ethnic
marketing, retail, and urban development. Through this experience, Image Fashions will gain credibility in being
committed to the community and recognition as the retailer and employer of choice within the target
communities.
The management team is seeking a commercial loan of $1.05M to begin operation of Image Fashions in the Fall
of 2003. The loan will be secured against Image Fashions inventory, accounts receivable and managements
personal guarantees.
Table of Contents
I. Concept ......................................................................................................................................................5
II. Industry Analysis ........................................................................................................................................5
A. General Market Definition ........................................................................................................................5
B. The Chicago Market ................................................................................................................................7
III. Target Market / Marketing Sales Plan ..................................................................................................... 11
A. Marketing Objective .............................................................................................................................. 11
B. Target Segment .................................................................................................................................... 11
C. Positioning Strategy .............................................................................................................................. 11
1. Price ................................................................................................................................................. 12
2. Promotion......................................................................................................................................... 12
3. Product Mix....................................................................................................................................... 13
4. Location ........................................................................................................................................... 15
IV. Market Analysis.. ............................................................................................... 15
A. General Competitive Landscape ............................................................................................................. 15
B. Site Specific Competitive Landscape ....................................................................................................... 15
V. Company Overview / Products & Services .................................................................................................... 18
A. Labor ................................................................................................................................................... 18
1. Managers.......................................................................................................................................... 18
2. Sales Associates ................................................................................................................................ 18
3. Buyer ............................................................................................................................................... 18
4. Training Philosophy ........................................................................................................................... 19
B. Store Design ......................................................................................................................................... 19
C. Security ................................................................................................................................................ 21
1. Personnel ......................................................................................................................................... 21
2. Infrastructure/Store Layout ................................................................................................................ 21
D. Inventory ............................................................................................................................................. 22
E. Purchasing............................................................................................................................................ 22
F. Hours of Operation ................................................................................................................................ 22
G. Layaway and Return Policy: ................................................................................................................... 23
VI. Financial Projections ................................................................................................................................. 23
A. Revenue Model ..................................................................................................................................... 23
B. Comparative Financial Performance ........................................................................................................ 26
VI. Financial Statements.............................................................................................................. 26
A. Start Up Costs ....................................................................................................................................... 26
B. Financing .............................................................................................................................................. 27
VII. Management .......................................................................................................................................... 27
A. Management Team ............................................................................................................................... 27
B. Advisory Board...................................................................................................................................... 28
VIII.Exit Strategy........................................................................................................................................... 28
APPENDIX AFinancial Analysis ..................................................................................................................... 29
A-1Most Likely Scenario .......................................................................................................................... 29
A-2.. Best Case Scenario ............................................................................................................................ 32
A-3Worst Case Scenario .......................................................................................................................... 35
APPENDIX BManagement Resumes ............................................................................................................. 38
I. Concept
Globalization has improved access to new customers and increased the competition for those customers.
However, in the rush to cross over into new borders, American retailers have overlooked an opportunity. This
overlooked customer is easily accessible, affluent, an early adaptor and trendsetter. This market is the American
inner city, and the customer is the growing minority population that lives there.
According to recent studies, the American inner city has $85B in retail purchasing power, but nearly 25% of that
demand is unmet. The result is $21B in retail spending that is not captured, and in Chicago alone this gap is
$640M.1 This business plan will outline why high e nd apparel is a major unmet market in Chicagos inner city and
how a strategic and disciplined approach to high end apparel retail in Chicagos low income communities can
generate revenue and employment.
II. The General Market
A. General Market Definiti on

The definition of a low income, or economically distressed neighborhood is a that which has a median
household income 25% less then the city average, a poverty rate at least 50% higher than the city
average and/or unemployment at least 30% higher then the city average. 2 In Chicago, 1.77M people
live within a neighborhood that fits this definition.
The purchasing power of this population is counterintuitive. To the casual observer, below average per
capita income would mean less purchasing power for luxury or high end goods. However, a series of
characteristics make this market extremely attractive. The first and most important characteristic is
population density.
In the inner city, most families and individuals rent apartments. While there are several macro issues
that drive this pattern, the result is a large number of renters living within a small area. By comparison,
1 lot in the suburbs or an affluent neighborhood will typically have a single or dual unit town home. In
the same acreage of an inner city neighborhood, there is a 5-10 story apartment complex housing 35
families. The discretionary income of the 2 families in the affluent neighborhood is less than the
combined discretionary income of the 35 families in the inner city!
Another pattern that frees discretionary income for inner city residents is that affluent homeowners spend
a large percentage of their income on housing repairs and maintenance costs. Since a renter does not
have these costs, it frees their discretionary income to be spent on personal items and expenses, such as
retail goods and entertainment services. Statistically, 67% of total U.S. shoppers own their home as
compared to only 36% in the inner city. 3
The third driver of the inner city purchasing power is the racial and ethnic composition of the
neighborhood. Low income neighborhoods are typically populated by African American and Latino
families and individuals. According to market research, 4 both groups are more image conscious than
their white or suburban counterparts. Since they are not spending their income on housing expenses,
they focus their expenditures to meet their image and fashion concerns, specifically in apparel. The
following graph displays the difference in apparel purchasing patterns.
The Business Case for Pursing Retail Opportunities in the Inner City, The Boston Consulting Group in a partnership with The Initiative for a
Competitive Inner City, June 1998.

2
The Inner-City Shopper: A Strategic Perspective, Pricewaterhouse Coopers and the Initiative for a Competitive Inner City, 1997.
2nd Annual Inner-City Shopper Survey: Inner-City Shoppers Make Cents (and Dollars), The Initiative for a Competitive Inner City and
Pricewaterhouse Coopers, November, 1998.
4
The Business Case for Pursing Retail Opportunities in the Inner City, The Boston Consulting Group in a partnership with The Initiative for a
Competitive Inner City, June 1998.
3
Illustration 1: Annual Apparel and Service Expenditures by Race
$1,200
$1,000
$800
Total Inner City

US Shoppers
White
$600
$400
$200
$0
African
American
Hispanic
Note: The U.S. Census defines this clothing expenditures in the category, Apparel and Services, and it is defined as retail
5
expenditures includes dollars spent on all apparel, footwear, jewelry and other apparel and services.
Currently, several key mainstream designers, such as Tommy Hilfiger and Ralph Lauren, view the inner
city as fashion trendsetters. These neighborhoods are early adaptors of new designs and set the trends
for their suburban peers. In market surveys, over 50% of African Americans and Latinos ranked trend
setting fashions as somewhat or very important in the purchase criteria. This is compared to 30% of the
average U.S. shopper. This trend also seems to be increasing amongst the target populations. 6
MTVs urban, hip-hop music show, called Direct Effect, and MTVs fashion show, called Fashionably Loud,
recently hosted a one hour special fashion show highlighting the premier urban and hip hop fashion
brands. The show was a runway display of the new lines from leading urban designers with several
performances by leading rap and hip-hop groups. It was a high-energy display of current and future
trends that visually demonstrated a clear difference in the trends and expectations of racial and ethnic
groups as opposed to their white counterparts. The influence and success of this show and others like it
on MTV and BET (Black Entertainment Television) demonstrates that this market and product offering is
nearing a stage of rapid growth and development.
The outcome of these combined characteristics is an image conscious and fashion sensitive population
that has discretionary income to spend on apparel. While there has been a drastic increase in the
number of designers, such as Sean John, Baby Phat, Phat Farm and FUBU targeting the urban consumer,
there has not been a corresponding increase in the retail stores that carry these lines. The result is an
escalating demand for the product and few sp ecialty stores to cater to this market.
http://www.oconomowocusa.com/retail%20profile.pdf
2nd Annual Inner-City Shopper Survey: Inner-City Shoppers Make Cents (and Dollars), The Initiative for a Competitive Inner C ity and
Pricewaterhouse Coopers, November, 1998.
6
B. The Chicago Market

Chicago is a unique market on several levels. First, Chicago is one of the top 3, most populated markets
in the U.S. and is recognized for its diverse and affluent population. Due to its affluence, most major
designers and retailers have stores on Chicagos Magnificent Mile (downtown Michigan Avenue) or in
the neighboring affluent communities. While Los Angeles and New York typically set American fashion
trends, Chicago earns its title of Second City, by eventually providing all of the same amenities and
products as other trend leading cities.
The second unique aspect of Chicago is the segregation of its population. Typically, races or ethnic
groups dominate one neighborhood or community and have little interaction with other groups.
Typically, affluent Caucasian city dwellers are drawn to the north side of the city, while lower income
foreigners and minorities live on the west and south side of the city. The result is high price real estate
on the north side with an abundance of retailers competing for revenue, while the west and south side
offer low cost housing but few recognized retailers. To spend their discretionary income, west and southsiders travel to the north side of the city or Michigan Avenue.
Illustration 2a demonstrates the average per capita income by ZIP Code. Historically, retailers would use
this as their primary metric when expanding operations into a new market or neighborhood. The darker
green ZIP Codes on the map indicate higher income areas as compared to the lighter green ZIP Codes.
Using this metric, the north side of Chicago seems to be the most attractive market, with little
opportunity for retail businesses on the south side. However, this metric does not account for population
density or spending patterns, two factors that are critical in measuring the potential success of retail
operations.
Illustration 2b accounts for the population density and for spending patterns, rather then strictly using
per capita incomes. In this second illustration, the north-sides advantage is not as clear, and it
demonstrates retail opportunities, based upon total apparel expenditures, on the south and west-side of
Chicago. The south side offers five high apparel spending ZIP Codes which are in the >$50MM range,
impressive when compared to their annual per capita income.
Illustration 2a: Average Per Capita Income by ZIP Code 7
7
8
Source: Analysis of U.S. Census Data

Source: Analysis of U.S. Census Data
Illustration 2b: Total Apparel Expenditures by ZIP Code 8
Illustration 3 overlays Chicagos apparel retailers with the information from Illustration 2b (Total
Apparel Expenditures by ZIP Code). It supports the historical pattern that retailers have used
only average income to define new market opportunities. The retailers, consistent with average
income patterns, are concentrated on the north side of the city. Markedly fewer retailers are
present on the south and west sides despite the great market potential.
Illustration 3: Per Capita Income by ZIP Code and Apparel Retailers by Addr ess 9
In comparing Illustrations 2 and 3, it is apparent that there is an affluent market sector that is
not having its demands met. Additionally, to further validate the opportunity of real estate and
business in the south side of Chicago, the area was recently selected by CNN.com as one of the
top U.S. neighborhoods to live in. 10
Based upon the growth of the high-end apparel industry and the customers spending power,
there is a unique opportunity to enter the fashion retail business in low income ur ban
neighborhoods. Chicago is a strong point of entry because of its national affinity to new trends,
diverse demographic distribution, lack of competition and high population density.
9
Source: Analysis of U.S. Census Data and Business Yellow Page Listings
CNN.coms Money section. http://money.cnn.com/2002/11/08/pf/yourhome/bplive_chicago/index.htm
10
III. Image Fashions Marketing Model

The marketing model will focus not only on attracting customers away from competitors but also on trying to
satisfy the innate demand within the local catchment area. The marketing model can be considered as below:
Illustration 4: Image Fashions Marketing Model
Price
Positioning Strategy
Promotion
Marketing Objective
Product Mix
Target Segment
Location
A. Marketing Objective
The Marketing Objective is to generate sales of $3.0M in the third year.
B. Target Segment
The urban clothing mix will be aimed specifically at young adults aged between 12 34. Based on
primary market research, this segment of the market is highly influenced by fashion and values the
distinctiveness that Image Fashions will provide. The buyer for a compariable urban clothing retailer, The
Lark, noted that our target market is aged 12 upwards, with clothes being often their only major outlay
and who place a premium on wearing the right clothes.11
C. Positioning Strategy
Because Image Fashions does not intend to manufacture or design its own products, it will differentiate
itself on service and product mix (by responding rapidl y to changes in fashions). In fact, very few
designer brands are exclusive to a particular retail outlet. Research has uncovered that the key factors
when deciding where to shop are:
Being treated with respect

Courteous sales staff
Being in an environment where they dont feel like they are being taken advantage of 12
Clear return policies
Branded offerings
Clean and stress-free shopping environment 13
11
Interview, November 9th 2002.

Interview with targeted customer segment, Saturday November 9th 2002.
13
The Case of inner-city retailing, Boston Consulting Group.
12
11
Having analysed the market and target segment, the marketing strategy will be as follows:
1. Price
Prices will be competitive with local competitors (with stores such as the Lark, Manalive and
Freshwear) rather than the local department store (Carson Pirie Scott and Marshall Fields).
However, price competition and undercutting will be avoided in order to maintain Image
Fashions status as a high end retailer.
Again, the primary assumption is that there is
considerable latent demand, so growth will come from tapping into this market, rather than
stealing it by discounting or through price competition.
Accordin g to Bob, the District Manager and Buyer for The Lark, they use neither sales promotions
nor loss leader products to promote sales because the business cannot afford to. Rather the key
differentiation is understanding the customer, both in terms of service and product. The Lark
sells 90% of its clothes at the initial price, and therefore, the attraction of being the first with the
cool clothes outweighs the price.
As a start-up, Image Fashions faces constraints in terms of limited initial cash flow and lack of
leverage with suppliers to return unsold products. Hence, in keeping a high status image, Image
Fashions will not compete by using sales discounts or loss leader products.
2. Promotion
The promotion strategy will be driven by the requirements of the local market. Specifically, the
strategy will encompass four areas:
a. Advertising
Because of the high urban density, most of the paid for advertising will be in the form of
billboards and local rap/hip- hop radio station advertising. These have the added
advantage of being relatively inexpensive compared to department store competitors
methods.
Once operational, Image Fashions plans to spend 5% of its revenue on marketing and
promotional expenses.
b. Promotion of local events in the community
Image Fashions target market can be easily reached through local high schools, colleges
and sports centers. There are plans to hold co- branded events (with the apparel brand
manufacturers) to promote awareness of the store. This idea has precedence one local
retailer currently sponsors an annual high school graduation party and regularly has in
excess of 3,000 potential customers turning up at the door, despite the fact that the
capacity is only for 1,200. In addition to providing advertising, these events will help
establish Image Fashions as a supporter of the local community.
c. Staff
By recruiting sales associates from the target market, Image Fashions will gain two
advantages beyond hiring other employees. First, sales associates will be familiar with
trends and be able to anticipate changes in tastes. MTV is famous for using this model
with their production assistants, who are students within the target demographic.
Secondly, it will reduce shrink/theft by having local, known faces to operate the store.
12
The sales associates will know some of the problem customers through their community
relationships.
In order to reduce staff turnover and improve selling ability, the staff will be hired
through a joint project with the local schools where grades are dependent on the
commitment and quality of work at Image Fashions. This labor model has been tried
before with considerable success in urban neighbourhoods.
d. Courteous service and respect for the customer
Given that Image Fashions will sell other brands rather than producing in- house lables,
the promotional activities will focus on service and product mix, which will be reinforced
through the stores employee incentive system and training program. Customer courtesy
is essential in building and maintinaing a high end retail image.
3. Product Mix
From interviews with local buyers, product mix varies dramatically from location to location and is
driven by the heterogeneity that can be seen in the urban city market. Since the right product
mix is critical for success, Image Fashions recognizes that it currently does not have the buyer
expertise required and is in the process of identifying an experienced specialty apparel buyer.
The product mix will be heavily influenced by fashions in Los Angeles (for women) and New York
(for men) and the clothing worn on the local television networks, particularly rap/hip-hop stations
such as MTV and BET.
a. Labels
Labels or brands are a critical component that allows the consumer to project a certain
style and image. Through customer surveys and market validation, a combination of
mainstream and ethnic brands has been identified. Illustration 4 is a sample of the
brands to be carried by the store. Mainstream brands like Tommy Hilfiger appeal to a
wide customer base, while ethnic brands like Phat Farm and Sean John are focused
purely on minority groups. These brands are identified as high-end apparel labels and
the exclusivity of the brands provides an even greater perceived value to the consumer.
This core group of brands share the vision of selling an exclusive image and reflect a
lifestyle that is unique and differentiated. Currently, customers need to go to outside of
their community to several places to find all these brands. Image Fashions will
differentiate itself by offering the convenience of bringing all these brands under one roof
and to their neighborhood.
The merchandize manager has begun negotiations with the various manufacturers to
determine the terms and conditions for distribution of these labels. The majority of the
negotiations should be concluded within the next 8 weeks.
13
Illustriation 5: Image Fashions Brand Licenses
MARITHE
FRANCOIS
GIRBAUD
PELLE PELLE
ICEBERG
COOGI
Sean John
b. Product offering
In line with high-end fashion apparel, a wide combination of shirts, pants, dresses,
shoes and accessories have been identified for the initial store launch. These products
are the key elements that define the image that the target customers seek to portray.
The products cover a wide price range, largel y influenced by customer demand and
preferences determined during market validation. Image Fashions also views customer
service as part of the overall product offering. The staff will be trained to recommend
and assemble items to capture the look and image that individual customers desire.
This is another way that Image Fashions will differentiate itself and will create loyal
customers, who will keep returning because of the intimate and personal service
provided. It is critical to have the right product mix, which is why an experienced buyer
will be hired, who is knowledgeable of the fashion trends and the specific needs of our
minority target customers. By virtue of the store location and a unique product mix,
Image Fashions will be able to move products fast. The average ticket per sale is
forecasted to be about $180.
Illustriation 6: Image Fashions Price and Per Purchase Revenue

Price Range
Leather/Fur Jacket
Shirt
Sweaters
Jeans / Pants
Shoes
Jumpsuits
TOTAL
Low
$250
$45
$30
$60
$75
$140
High
$900
$380
$120
$200
$220
$350
Probability
4%
25
13%
33%
10%
15%
100%
Average
$575
$213
$75
$130
$148
$245
Average Ticket:
$180
14
4. Location
A key advantage is that rather than being loca ted in an out- of-reach mall, Image Fashions will be
located within the target market and conveniently accessible by public transportation, which is
the mode most often used by our target demographic.
IV. Competitive Environment
A. General Competitive Landscape

As mentioned previously, the competition falls into two categories:
Local urban speciality retailers such as The Lark, Freshwear, Manalive

Local Department Stores such as Carsons, Marshall Fields
Given the generally underserved and extremely localized nature of the markets, there is limited need to
steal market share from the competition. Nevertheless, Image Fashions will adopt the best practices of
other urban retailers, as well as noting mistakes that have been previously made (particularly with
respect to local department stores).
The best of the competition is a small chain known as The Lark, operating 9 stores in and around
Indiana and Illinois. Many of the best practices that have been identified are in place with benchmarks for
achievable results. For example, using the practices identified above, The Lark estimates that they
turnover 90% of their product mix at the original price, considerably better than the larger department
stores. They have also reduced problems with shrinkage to low single figure percentages, despite
taking the decision not to introduce security tags. This compares very favourably with corporate giants
such as The Limited, whos shrinkage is 5% and increasing. 14
The key differentiatior between Image Fashions and The Lark is that The Lark continues to sell in large
suburban malls whereas Image Fashions will be located in the heart of the inner city and also nearer to
local high schools and colleges.
B. Site Specific Competitive Landscape

An ideal inner city location would incorporate convenience for the target consumer while maximizing the
probability of success for the retail business. The site location was chosen based on combining elements
of the above two qualities. Initially, ZIP Codes were parsed based on average income per person in the
surrounding Chicago area. The 60629 ZIP Code was selected, an area that is in the heart of southern
Chicago and the specific address is 7400 South Street.
The area within ZIP Code 60629 is a comparatively low income area with average income per person
approximating $30,000. In contrast, the area has one of the highest apparel expenditures per ZIP Code,
with expenditures in the range of >$50MM per year. With the purchasing power of residents in ZIP Code
60629 and the surrounding 5 mile radius, the apparel purchasing power within the immediate vicinity of
the store is estimated at $223MM per year. This exemplifies the inner city consumer with the large
spending power that Image Fashions is targeting. In addition, there are currently only eight retail apparel
stores within a 7 square mile area surrounding this specific location. None of these stores cater to highend fashion. The table below summarizes the competitive specifics:
14
Interview with Kelly Vergamini, Wednesday 13th November, Summer Associate, The Limited Corporate Headquarters.
15
Illustration 7: Local Competitive Analysis

Distance from IF location (7400 South)
Womens
retailers
Childrens
retailers
Athletic
retailers
Mens
retailers
1 mile
3 miles
(includes 1 mile retailers)
The following map highlights the annual apparel expenditures around the store and the location of
apparel retailers.
Illustration 8: Competitive Analysis and Apparel Expenditures at Site Location
16
Another critical part of the location analysis is the different linkages between the consumer and the store.
These linkages include factors such as accessibility, convenience and exposure. One measure of location
appeal from a retail perspective is the locations traffic count. The 7400 South address has a reported
52,900 car drive -bys per day a very large average daily traffic count15. This large traffic flow will
provide a good amount of exposure to the store. Image Fashions plan is to take advantage of this by
placing large signage (billboards, wall frescos, etc.) in the proximity of the location. Since 7400
South is at the signalized intersection of Gold Road and South Avenue consumers can easily turn into the
location if they are traveling in a car. The site also affords plenty of on premises parking, further
augmenting its convenience.
In the likely event that consumers will be commuting via public
transportation, the location is easily accessible via numerous transportation routes.
Six different CTA bus lines have stops, all within less than a block from the location. The 54B, 379, 382,
383, 384, 385 bus routes give consumers access to the location from all directions, during all times of day
(see Illustration 9). Additionally, the CTA Orange El line is less than three miles north of 7400 South
where all of the above mentioned bus lines originate from.
This ensures adequate public
transportation from the Orange El to the location, making it a convenient commute from almost
anywhere on the CTA train system.
Illustration 9: CTA Bus Routes near 7400 South 16
15
Source: Illinois Department of Transportation, Average Daily Traffic
16
Source: Chicago Transit Authority, south west system map
17
V. Operations
A. Labor
1. Managers
Staffing will include two managers, who will work on a shift system so that the store is fully
manned, seven days a week. One manager will be an employee on a $40,000 base salary and
bonus package, while the other manager will be an owner earning $50,000 per year plus his/her
equity stake in the store.
The store manager will have a crucial role in running the store and ensuring its success. Along
with greater responsibility, a great deal of latitude will also be given to the store manager. The
store mangers skills are crucial in two areas:
Experience in urban retail store management: Image Fashions will hire experienced
managers from the competitors.
The ability to intimately relate to customers: This means that the store mana gers will
proactively create relationships by being visible both in the store and in the local
community. The store manager will be present at the major parties and events where
the current and potential customers frequent and will provide major input into the
product mix.
Based on the crucial role in the store, it is important that the store manager be compensated
generously. Incentives will be given based on store performance, and 2% of net income will be
given to the store manager in addition to salary. Full dental and medical insurance will be given.
2. Sales Associates
Sales Associates will primarily be recruited from local high schools and colleges. The pay will be
$5.50 per hour (an industry-wide figure). In order to reduce employee turnover, Im age Fashions
will be actively working with the faculty and administration at these institutions to identify the
most reliable students and to institute some work experience programs. As the buyer/district
manager at The Lark (who successfully follows this approach) commented, the most reliable
sales associates are those that initially had some form of academic incentive. They even
continued to work for us during vacation time.
The hourly wage sales associates will not be given significant benefits. The wage is consistent
with other retailers, so it does not distinguish Image Fashions as an employer of choice. What
will give Image Fashions a hiring advantage amongst its target group is a $100 coupon for
clothes. For every week that an associate works, they will receive a coupon for apparel in the
store. The perceived value of the coupon will be $100, but the actual cost will only be $45,
based upon the COGS. This incentive will make it very fashionable and desirable to work for
Image Fashions rather than another retailer also paying $5.50/hour.
3. Buyer
One of the key success factors for this business venture is to offer a product portfolio that is
based on the latest fashion trends and preferences of the target customer segment. The role of
the buyer is critical in order to achieve this objective. Therefore, the management team is
spending considerable time and effort to identify the most suitable buyer to meet the vision of
Image Fashions. Four candidates have been shortlisted based on criteria supplied by Image
Fashions Board Advisor and the position is expected to be filled within the next six weeks.
18
4. Training Philosophy
It is expected that the sales associateswill start with minimal retail experience. Thus a five day instore training period will be administered for all new employees. This is a significantly longer
training period than compared to other retail stores. Skills to be acquired at the end of the
training period are: basic store operating skills, an understanding of the clothing lines carried by
Image Fashions and the importance of customer service.
The primary message that store employees will be trained on is that exceptional customer service
is critical. The Image Fashions definition of exceptional customer service includes making the
customers feel welcomed and treating them with respect. Employees will not push for a sale, but
rather they will give an honest, non-offensive, opinion relating to the customers choice of
apparel.
Employees will also generate suggestions of alternative products and apparel
combinations. The customers should feel that the employees dedicate sufficient time with them
in a very respectful and attentive way. The store managers will have a central role in educating
the employees on the importance of making the customers feel comfortable in the store.
B. Store Design
The store site will be located at 7400 South Avenue. The property is 8,000 square feet and located
in a freestanding building. As a freestanding building, the exterior of the location can be modified to exude
a high-end apparel store. Visible from the exterior will be ample storefront to display the latest cutting
edge minority driven trends. The rent for the location is $25,120 annually ($3.14 per square foot).
This amount does not include utility costs or property insurance. The interior of the location is 50 feet
wide by 80 feet long with no interior dividing walls. Bradley Builders of Chicago has been contacted to
transform the inside of the store into a trend setting retail space. Bradley Builders has remodeled
Bang & Olufsen retail spaces, a trend-setting retailer. The cost to accomplish this would be $630,000,
which includes the build-out with all lighting and fixtures.
Given that the store site is located in a higher crime rate neighborhood, Image Fashions will need to
address shrinkage in the store design. As part of the store layout, Bradley will include design elements
that help prevent shrinkage, mainly consisting of creating an indirect access from the store entrance to
the inside of the store.
There will be a walled off area of the store that will be used for inventory
storage, back office space, security monitoring and fitting room areas. This will leave 7,500 square feet
of retail space for displaying apparel. Most of the inventory will be displayed on the store fixtures in the
retail space with inventory storage being used primarily for new product shipments and storing
extraneous quantities.
19
Illustration 10: Store Layout

80 feet
Fitting
Room
Area
Managerial
Office
Security
Office
Inventory
Space
Waiting
Area
Column
Column
Column
Ramped and Glass-walled Entrance / Exit

Window Display
80 feet
20
C. Security
One of the main risk factors of running a business in an inner city location is the high incidence of crime
such as shrink, burglary and arson. The following table shows the area crime statistics for the district
within which the proposed store location is based.
Illustration 11: Number of Crime Occurrences 17

Year
Robbery
Burglary
Theft
Arson
Violent
Property
2002
935
1,767
4,762
61
2,093
8,430
2001
774
1,600
4,863
65
1,850
8,271
(January September)
Crime is a significant deterrent that discourages many entrepreneurs from setting up businesses in the
inner city. Therefore, it is being considered a serious issue, and Image Fashions is proactively devoting
resources to mitigate the risk.
1. Personnel
The employee training program will include crime prevention and handling procedures. Market
research has indicated that inner city customers often believe that they are treated with
disrespect since they are considered a possible crime suspect from the very moment they step
into a store. Therefore, in line with the vision of providing a safe shopping environment and
desire to treat customers with the highest satisfaction, employees will be trained to keep a
watchful yet discreet eye on possible offenders. Howeve r, a full-time security guard, or
bouncer, will not be employed. A security advantage of hiring employees from the community
is that they will know which customers are potential crime suspects.
One of the store employees will be responsible for check ing the number of items that a customer
takes into a fitting room. In addition to store employees, Image Fashions intends to hire a
security company to provide security personnel to monitor the premises during after-hour periods
to discourage arson and burglaries.
2. Infrastructure/Store Layout
Image Fashions will invest in a surveillance camera system that will be placed at strategic points
in the store such as the store entrance/exit, fitting rooms, inventory space, cash register areas,
and throug hout the floor space. There will be only one entrance/exit to the store, which will be
glass walled and ramped, as shown in Illustration 8. In addition, Image Fashions plans to place
anti-theft devices on all higher priced items that will sound an alarm when a customer walks past
the detectors placed at the exit. The anti- theft devices will be removed at the cash register when
the customer pays for the item. The glass-walled and ramped entrance/exit will discourage take and-run theft incidences.
17
Chicago Police Department
21
D. Inventory
Successful inventory management is a key element for success and profitability for Image Fashions.
Fashion trends are especially fickle. As a start up, Image Fashions does not have the reputation or
financial strength to finance inventory or return unsold items. It must have inventory on hand to meet
flash demand or impulse purchases. However, excess inventory could tie up cash flow or be written off
as a loss.
Image Fashions will manage its products through two categories:
Advance Orders: regular fashion trends viewed through trade shows
Urban Hits: heavily influenced by street trends and new breaking promotions through television
and other music stars. These can be ordered a month in advance.
Image Fashions intends to have its inventory delivered on a weekly basis so as to minimize warehousing
costs, reduce working capital and keep the product mix current. This may cost more, in terms of delivery
charges and COGS, but will pay for itself through higher margins.
Image Fashions, in its first year, will have to order and pay for the first 8 months worth of inventory in
advance as it will not have a credit history or relationship with the suppliers. Due to the small order size,
Image Fashions cannot expect to be able to return unsold goods to the manufacturer.
To overcome this limitation, three actions are considered:
Minimize ordering of non-selling SKUs this will be done by ordering deliveries on a weekly basis
to minimize order sizes.
Promoting lower selling SKUs by getting sales associates to wear them in the store. This has
been tried successfully in Inditex, a global retailing chain.
Sales discounts will only be used to move old invesntory (these discounts will not occur as a store
wide sale, rather as individual markdowns).
The bulk of the inventory will be on display in the commercial area, with a small portion stored in an
inventory holding area in the back of the store.
E. Purchasing
There are three main trade shows that occur in the fashion business, each selling for the Spring,
Fall/Winter and Summer collections respectively. 18 Image Fashions will need to pay for goods in advance.
Therefore, 8 months of inventory will need to be financed. These costs have been included in the start-up
and Year 1 costs. Beyond that period, Image Fashions will be able to finance the inventory purchases
from the profits and by negotiating credit periods based on the trading history with manufacturers.
Due to the highly volatile nature of the urban fashion market, trends can be started overnight by the rise
of a new music star or a hot new TV show. Deliveries will be scheduled to occur on a weekly basis
allowing for maximum flexibility. Maintaining the right product mix is more important that minimizing
delivery expense, particularly given the high gross margins available on the merchandise.
F. Hours of Operation
The store will have the following opening hours:
Monday- Friday: 10.00 am 9.00 pm
Saturday: 10.00 am 9.00 pm
Sunday: 11.00 am 7.00 pm
18
E-mail interview with Chun Yee Yip, Buyer, Ann -Taylor.
22
Work Shifts: One store manager will be in store at any one time. The table below lists the number of
sales assistants per shift. Although there will be 18 sales assistants, the Full Time Equivalent is 10.9
(assuming a 40 hour working week).
Illustration 12: Store Operating Hours

No. of sales assistants
Mon
Tue - Thu
Friday
Sat
Sun
Morning Shift
2
2
2
12
10
Afternoon Shift
2
2
8
12
10
Evening Shift
6
6
12
12
10
Total number of store managers: 2 full time.

Total number of retail employees: 18 sales assistants (part-time)
G. Return Policy:
While Image Fashions does not anticipate a significant amount of the business being impacted by
returns (in line with competitors), there will be a clear policy regarding them:
Return Policy
The most important part of the return policy is that it remains clear and visible before the point of
purchase without being distasteful. The policy will be posted clearly beside the till. In accordance with its
reputation for excellent customer service, Image Fashions will allow customers to return undamaged
goods accompanied by a receipt within 30 days. Unless the goods are defective from the manufacturer,
Image Fashions cannot return the merchandise for credit. Rather, Image Fashions will liquidate the
merchandise off-line (not through store sales) via discounted sales to either current employees or major
discount retail brokers.
VI. Financial Analysis
A. Revenue Model
Image Fashions ability to generate revenue is susceptible to several variables within its localized market.
The overall market and site -specific market was discussed in Section IV: Competitive Environment and
highlighted the total apparel sales within the region. However, several assumptions were made to
determine the revenue that Image Fashions can capture. The first critical variable is the percentage of
the total apparel value that is spent on high-end apparel within this market. The second key variable is
the market share that Image Fashions can gain within its local market. Since the Image Fashions
business model is based upon providing high-end products with outstanding customer service within low
income neighborhoods, Image Fashions must capture a portion of the market share within a 5-mile
radius. To improve the sensitivity of the analysis, individual market shares were estimated for 1, 3 and 5
mile radii.
23
Illustration 13 highlights the captured marketing share for three different scenarios, Best Case, Most
Likely and Worst Case.
Illustration 13: Market Share Scenarios

Best Case
High End Apparel as % of Total Apparel Revenue
Most Likely
Worst Case
26.0%
25.0%
22.0%
1 Mile Radius
25%
20%
15%
3 Mile Radius
5 Mile Radius
12%
6%
10%
4%
8%
2%
IF Market Share for
Gross Revenue (Fully Operational)
$4,769,487
$3,443,228
$2,024,362
To fully develop the financial model beyond the market share, several additional assumptions were made
to estimate revenues and costs. These assumptions included:
Returned Goods: In an effort to provide outstanding customer service, Images Fashions will
allow customers to return unused clothing to the store for a full refund. Returns were estimated
as 2% of gross sales.
Discounted Sales: While Image Fashions will not provide ongoing discounts, some items will
need to be discounted to clear inventory. The financial model estimates that 15% of Image
Fashions gross sales will be sold at a 20% discount. As mentioned in this plan, The Lark sells
90% of its items at full price, so this assumption is conservative.
Cost of Goods Sold: Image Fashions wholesale prices will not be determined until orders are
placed. However, it is unlikely to qualify for volume discounts. The financial model assumes that
the Image Fashions wholesale cost will be 45% of the retail price. The summation of wholesale
price and sales discounts combine for the total cost of goods sold.
Credit Card Purchases: Image Fashions clientele will use credit cards, but not as frequently
as shoppers in the suburbs or on Michigan Avenue. It is assumed that 40% of net sales will
come from credit cards with a standard service fee of 2% of sales tha t is typically charged to the
vendor by the credit card provider. The revenue from credit card purchases will be Image
Fashions primary accounts receivable.
Inventory: Image Fashions greatest expense, both in start-up and operation, is its inventory.
It will target 4 inventory turns per year, which will dictate the level of stocked inventory as well
as ordering levels. Currently, the industry average for stocked inventory is 26%, which is
consistent with the assumption of 4 turns per year. Image Fashions will finance its first 8 months
of inventory through the initial loan. Another inventory concern is shrink, or theft, from
customers or employees. This was estimated at 3% of sales.
Loan Terms : Image Fashions loan will cover the cost of start up and inventory, and it
anticipates loan terms approximating 8% over 7 years. Servicing this debt is included in the
financial projections. A scenario does exist to draw down the loan in 2 two phases, for start-up
and in Year 2, which would save the owners approximately $6,000, however, these financials
reflect a single draw down.
Based upon these assumptions, the following charts demonstrate the financial performance over the next
5 years. The full financial statements for all three scenarios are in Appe ndix A.
24
Illustration 14: Financial Projections for Image Fashions.

Gross Revenue
Net Income
from Income Statement
from Income Statement
$5,000,000
$1,000,000
$4,500,000
$800,000
$4,000,000
$600,000
$3,500,000
$3,000,000
Best Case
$2,500,000
Most Likely
$2,000,000
Worst Case
$400,000
$200,000
$0
$1,500,000
$1,000,000
($200,000)
$500,000
($400,000)
$0
Year 1
Year 2
Year 3
Year 4
Year 1
Year 5
Year 2
Year 3
Year 4
Net Cash Flow from Operating Activity
Outstanding Current Debt
from Cash Flow Statement
from Balance Sheet
$1,000,000
$1,200,000
$800,000
$1,000,000
$600,000
Year 5
$800,000
$400,000
$600,000
$200,000
$400,000
$0
$200,000
($200,000)
($400,000)
$0
Year 1
Year 2
Year 3
Year 4
Year 5
Year 0
Year 1
Year 2
Year 3
Year 4
Year 5
B. Comparative Financial Performance

To formulate some of the assumptions and validate the results in the financial model, retail industry
benchmarks were used. The foll owing table shows the major benchmarks that were obtained from
various retail stores. The results forecasted by Image Fashions may be superior to some of the industry
benchmarks such as the sales per square foot since the store will be more focused on a smaller
customer segment and by virtue of its unique product mix. However, the overall performance metrics
demonstrate that Image Fashions financial projections are conservative.
Illustration 15: Comparative Performance Metrics 19

Abercrombie
Aeropostal
& Fitch
Gross Sales/Square Foot
Sales/Store
American
Eagle
Outfitters
$401
$514
$3,095,000
Square Feet/store
COGS*
SG&A*
Net Earnings*
7,840
59.1%
21.0%
69.9%
15.2%
8.9%
39.9%
24.0%
8.6%
GAP
Nieman
Marcus
Guess
$394
$288
$3,320,000
$1,477,700
8,700
64.0%
5,100
65.0%
41.6%
1.1%
-0.1%
$511
Image
Fashions
$430
$3,443,228
32.3%
26.2%
8,000
48.1%
23.8%
14.4%
*Note: Percentages based upon Net Revenue
VI. Financing
A. Start Up Costs
The primary costs in starting a retailing operation is the store build-out (the conversion of an existing
space into a store), the inventory expense and the working capital. The cost is detailed as follows:
Illustration 16: Start Up Costs

Item
Advertising Expense
Infrastructure
Build Out
Inventory System & Register
Miscellaneous Electrical Equipment
Inventory
Legal Fees
Security
Working Capital
Total
Cost
$
10,000
$
$
$
$
$
$
$
600,000
25,000
5,000
553,973
6,000
15,000
295,496
1,510,469
As a start up, Image Fashions will need to finance 8 months of inventory since it does not have an
existing credit line. The initial inventory cost is approximately $554,000. Furthermore, since Image
Fashions is a startup business, approximately $295,000 will be needed to cover operating costs during
the first 18 months of operations. Along with several other miscellaneous expenses the total to open a
high-end apparel retail store on the southside of Chicago is $1.5M.
19
Source: Company Annual Reports for Fiscal Year 2000 verse Image Fashions Full Operational Year 3
B. Financing
The start up costs for Image Fashions will be funded through the following 3 sources:
Illustration 17: Sources of Funding

Owner Equity
Percentage
20%
Percentage
10%
Percentage
70%
Grants/Funds
Commercial Loans
Total
302,094
$
$
151,047
1,057,328
1,510,469
The first source is the owners investment, which is 20% of the total cost. The six owners will each
contribute approximately $50,000 totalling the $302,000 requirement. The second source of funding will
be through the City of Chicago and other community development funds. As highlighted in Appendix C
several groups provide funding to support economic devlepment in low income neighborhoods. Based
upon the management teams familiarity with the organizations, they anticipate receiving 10%, or
approximately $151,000 in grants. The final source will be a commercial loan for $1.06M.
VII. Management
A. Management Team
The management team of Image Fashions is formed by a variety of different backgrounds, which are
complementary and will allow Image Fashions excel in retail sales.
Barry Miller, the CEO, has considerable experience in developing projects for the community. He
has worked with youth and community development groups in the inner city for over 8 years, and
currently runs a management consulting organization that provides consulting services to
businesses in low income neighborhoods. The organization, the Neighborhood Business Initiative ,
currently involves over 140 people. This exposure to the inner city and experience running an
organization will provide the managerial foundation for Image Fashions.
Jon Smith has broad experience in finance and marketing services through his work as a
consultant for more than 5 years. He will be responsible for the financial department while paying
close attention to meeting financial milestones.
Allen Green has been working as a consultant for more than 4 years and has relevant
experience in business planning and operational efficiency. He will provide valuable insight into
the site selection, store layout, and ongoing operations of the store.
Oscar Williams has worked in sales for more than 3 years, dealing with diverse customers and
industry sectors. He also worked for a European retailer, Makro, for 6 months in the sport
apparel department. He will manage the store operations by optimizing the allocation of inventory
as well as the store layout to maximize the ticket purchases among the customers who enter the
store.
Will Sharpe will be in charge of the marketing strategy. He has extensive experience with
media companies as well as designing and implementing business plans. He has customer
relationship experience that will help Image Fashions to formulate the right strategy for acquiring
loyal customers. He will also be in charge of the advertising strategy while leveraging his
relationships with the media and advertising companies.
27
George Michaels will be responsible for merchandizing and selectin g the right product mix
needed to attract and maximize the purchase rate per customer. Together with a buyer, to be
identified, he will control the product mix to reflect the current fashion trends.
B. Advisory Board
Image Fashions recognizes the value of a trusted and experienced Board of Advisors. Although the
management is in conversations with additional renowned experts who may join in the future, the current
Board of Advisors is comprised of:
Professor Gerald Dryer, Director of the Center for Retail Management, Williams
Professor Wilma Darman, Professor of Marketing Strategy, Williams
Gary Park, Senior Buyer, Saks
Mike Lowe, Director of Ethnic Marketing, Old & Circle
Image Fashions will use the Advisory Boards wealth of experience to improve its operations as well as to
streamline efficiency in the use of limited resources and personnel.
VIII. Timelines and Next Steps

The background analysis is complete, but the fundraising process is just beginning. We have yet to
receive final confirmation from the grant providers, but this funding appears secured. With the approval
of a commercial loan, the Image Fashions management team is ready to begin operations immediately.
The next step is to hire a buyer and purchase the first season of clothing for Image Fashions. It will
require 8 months from order to delivery, so orders will need to be placed soon for the winter of 2003
season. The second step is to finalize the lease on 7400 South and begin the store build-out, which
will take 4 months to complete.
Barry Miller, the President/CEO, will be the first full time employee and assume full responsibility for the
operations of the business. The remaining members of the management team will continue to work their
current jobs until the overall organization can support their fields of expertise. Gulshan Verma will be the
second member of the management team to begin full time employment with Image Fashions.
The overall goal of the management team is to grow Image Fashions into a national chain that is
recognized for urban fashions and its unique model of operating in low income neighborhoods. If the
model and operation proves effective, then a second store will be opened in the 60619 ZIP code in two
years. Further expansi on will take Image Fashions into other markets, specifically Detroit, Pittsburgh, St.
Louis and Miami. Eventually, the size and growth of the organization will be able to support all 6 owners.
Illustration 18: Timeline of Activities

Activities
Secure financing
Store location selection
Store construction
Brand / distribution right negotiation
Buyer selection
Hire staff and train employees
Advertising
Market validation
Month
10
11
12
13
14
15
16
28
APPENDIX AFinancial Analysis
A-1Most Likely Scenario
Image Fashions, LLC
Income Statement
For Year Ending December 31, 20xx

(in $000's)
Year 1
Gross Revenue
Year 2
Year 3
Year 4
Year 5
831.0
2,527.9
2,988.6
3,141.5
3,302.2
Returned Goods
12.5
37.9
44.8
47.1
49.5
Discounts
24.6
74.7
88.3
92.8
97.6
793.9
2,415.3
2,855.5
3,001.6
3,155.1
Cost of Goods Solds
381.8
1,161.6
1,373.3
1,443.5
1,517.4
Gross Income
412.1
1,253.7
1,482.2
1,558.0
1,637.7
Sales Salaries & Expenses
170.2
175.9
178.4
179.2
180.2
Advertising Expenses
24.9
75.8
89.7
94.2
99.1
Bad Debt Expense
Credit Card Charges
6.4
19.3
24.0
Net Revenue
Operating Expenses
Selling Expenses
Theft/Shrink
22.8
25.2
23.8
72.5
85.7
90.0
94.7
225.2
343.6
376.5
387.5
399.1
Administrative Salaries & Expenses
108.0
108.0
108.0
108.0
108.0
Bank Charges
Loan Payments
117.8
127.6
138.1
149.6
162.0
Total Selling Expenses

Administrative Expenses
Miscellaneous Expenses
Accounting Expenses
4.0
4.0
4.0
4.0
4.0
Legal Costs
$
$
12.0
9.0
$
$
12.0
10.0
$
$
12.0
10.0
$
$
12.0
10.0
$
$
12.0
10.0
Telephone
Insurance
1.2
1.2
1.2
1.2
1.2
Rent Expenses
25.1
25.1
25.1
25.1
25.1
Security Expenses
6.0
6.0
6.0
6.0
6.0
283.1
293.9
304.5
315.9
328.4
Total Operating Expenses
508.3
637.4
681.0
703.5
727.5
(101.0) $
611.5
796.4
849.8
905.5
Tax Expense
9.1
244.6
318.6
339.9
362.2
Interest income
Interest expense
80.6
70.8
48.8
Depreciation/Amortization
6.0
6.0
6.0
6.0
6.0
(Gain) or loss on assets
Other (Gain) or loss
321.4
384.8
394.7
404.5
(196.7) $
290.1
411.6
455.1
500.9
Total Administrative Expenses
Total Other (Income) or Expenses

Net Profit after Taxes
$
$
95.7
60.2
36.3
29
Image Fashions, LLC
Balance Sheet
For Year Ended December 31, 20xx (in 000's)

(in $000's)
Assets
Year 1
Year 2
Year 3
Year 4
Year 5
Current Assets
Cash and cash equivalents
Accounts Recievable
$
$
109.6
45.8
$
$
0.3
92.6
$
$
307.9
97.4
$
$
732.4
102.4
$
$
1,201.0
107.6
Inventories
198.5
603.8
713.9
750.4
788.8
Prepaid expenses
5.1
6.4
6.8
7.0
7.3
358.9
703.1
1,125.9
1,592.2
2,104.6
18.0
Total Current Assets
Long Term Assets
6.0
Goodwill and other intangibles
Other assets
$
$
24.0
382.9
$
$
18.0
721.1
$
$
12.0
1,137.9
$
$
6.0
1,598.2
$
$
2,104.6
Current debt
942.9
815.3
677.2
527.6
365.5
Accounts payable
5.1
6.4
6.8
7.0
7.3
Accrued expenses
948.0
821.7
684.0
534.6
372.8
821.7
684.0
534.6
372.8
(100.6) $
453.9
1,063.6
1,731.8
Total Long Term Assets

Total Assets
24.0
Property, plant and equipment
12.0
Liabilities and Owner's Equity
Current liabilities
Total current liabilities

Long term debt
-$
Total liabilities
Total Owners' Equity
948.0
(565.1) $
Image Fashions, LLC
Statement of Cash Flows

(in $000's)
Cash flows from Operating Activities

Net Income per Income Statement
(196.7) $
290.1
411.6
455.1
500.9
6.0
6.0
6.0
6.0
6.0
Increase in Inventory
Increase in PrePaid Expenses
N/A
405.3
110.0
36.5
38.4
N/A
1.3
0.4
0.2
Add
Depreciation
Deduct
Decrease in Accounts Payable

Net Cash Flow from Operating Activities
(1.3) $
(109.3) $
(0.4) $
307.6 $
(0.2) $
424.6 $
0.2
N/A $
(190.7) $
(0.2)
468.5
-$
Cash Received from Investments Sold
-$
Less Cash Paid for Store Equipment
-$
Net Cash Flow from Investing Activities
-$
-$
Increase in Cash
(190.7) $
307.6
424.6
Cash at the Beginning of the Year
300.3
109.6
0.3
307.9
732.4
Cash at the End of the Year
109.6
0.3
307.9
732.4
1,201.0
Cash flows from Investing Activities
Cash flows from Financing Activities

Cash Paid for Dividends
(109.3) $
468.5
30
Image Fashions, LLC
Financial Metrics and Coverage Ratios

Year 1
Year 2
Year 3
Year 4
Year 5
Income Statement
Sales growth (%)
Net Revenue/Sq. Foot
N/A
$103.87
204%
$315.99
18%
$373.58
5%
$392.69
5%
$412.78
Cost of goods sold / Sales (%)
48%
48%
48%
48%
48%
Gross margin (%)
52%
52%
52%
52%
52%
Operating expenses / Sales (%)
64%
26%
24%
23%
23%
Operating Margin (%)
36%
74%
76%
77%
77%
N/A
-708%
30%
7%
7%
Net income margin (%)
-25%
12%
14%
15%
16%
Net income growth (%)
N/A
248%
42%
11%
10%
Debt / EBITDA
-9.3 x
1.3 x
0.8 x
0.6 x
0.4 x
EBITDA / Interest expense
-1.3 x
8.7 x
13.3 x
17.5 x
25.0 x
EBIT / Interest expense
-2.3 x
7.6 x
12.2 x
16.4 x
23.8 x
Operating Growth Rate (%)
Coverage Ratios
Note: All Sales Percentages are based upon Net Sales
31
A-2.. Best Case Scenario

Image Fashions, LLC
Income Statement

(in $000's)
Year 1
Gross Revenue
Year 2
Year 3
Year 4
Year 5
1,151.0
3,501.7
4,139.8
4,351.6
4,574.2
$
$
17.3
34.0
$
$
52.5
103.5
$
$
62.1
122.3
$
$
65.3
128.6
$
$
68.6
135.2
1,099.7
3,345.7
3,955.3
4,157.7
4,370.4
Cost of Goods Solds
528.9
1,609.0
1,902.2
1,999.6
2,101.9
Gross Income
570.8
1,736.6
2,053.1
2,158.2
2,268.6
$
$
170.6
34.5
$
$
180.8
105.0
$
$
184.2
124.2
$
$
185.3
130.5
$
$
186.6
137.2
Bad Debt Expense
Credit Card Charges
8.8
26.8
31.6
33.3
35.0
Returned Goods
Discounts
Net Revenue
Operating Expenses
Selling Expenses
Theft/Shrink
33.0
100.4
118.7
124.7
131.1
246.9
413.0
458.7
473.9
489.9
108.0
108.0
108.0
108.0
108.0
Bank Charges
Loan Payments
120.1
130.1
140.9
152.6
165.2
Accounting Expenses
4.0
4.0
4.0
4.0
4.0
Insurance
12.0
12.0
12.0
12.0
12.0
Legal Costs
9.0
10.0
10.0
10.0
10.0
Telephone
1.2
1.2
1.2
1.2
1.2
Rent Expenses
25.1
25.1
25.1
25.1
25.1
Security Expenses
6.0
6.0
6.0
6.0
6.0
285.4
296.4
307.2
318.9
331.5
532.3
709.4
765.9
792.8
821.4
33.7
1,022.4
1,282.4
1,360.6
1,442.3
Tax Expense
38.4
576.9
Interest income
Interest expense
82.2
6.0
6.0
126.5
487.2
580.4
600.0
620.0
(92.8) $
535.2
702.0
760.6
822.3


409.0
513.0
544.2
72.2
49.7
6.0
6.0
6.0
61.4
37.1
32
Image Fashions, LLC
Balance Sheet

(in $000's)
Assets
Year 1
Year 2
Year 3
Year 4
Year 5
Current Assets
Accounts Recievable
$
$
30.0
63.4
$
$
9.7
128.3
$
$
565.3
134.9
$
$
1,281.4
141.8
$
$
2,056.5
149.0
Inventories
274.9
836.4
988.8
1,039.4
1,092.6
Prepaid expenses
5.3
7.1
7.7
7.9
8.2
373.6
981.5
1,696.7
2,470.5
3,306.4
18.0
Long Term Assets
6.0
Other assets
$
$
24.0
397.6
$
$
18.0
999.5
$
$
12.0
1,708.7
$
$
6.0
2,476.5
$
$
3,306.4
Current debt
961.5
831.4
690.5
538.0
372.7
Accounts payable
5.3
7.1
7.7
7.9
8.2
Accrued expenses
966.8
838.5
698.2
545.9
380.9
838.5
698.2
545.9
380.9
(569.2) $
161.1
1,010.5
1,930.6
2,925.4

Total Assets
24.0
12.0
Current liabilities

Long term debt
-$
Total liabilities
966.8
Image Fashions, LLC

(in $000's)

(92.8) $
535.2
702.0
760.6
822.3
6.0
6.0
6.0
6.0
6.0
N/A
561.5
152.4
50.6
53.2
N/A
1.8
0.6
0.3
Add
Depreciation
Deduct

(1.8) $
(20.2) $
(0.6) $
555.6 $
(0.3) $
716.0 $
0.3
N/A $
(86.8) $
(0.3)
775.2
-$
-$
-$
-$
-$

Increase in Cash
(86.8) $
555.6
716.0
775.2
116.8
(20.2) $
30.0
9.7
565.3
1,281.4
30.0
9.7
565.3
1,281.4
2,056.5
33
Image Fashions, LLC

Year 1
Year 2
Year 3
Year 4
Year 5
Income Statement
Sales growth (%)
N/A
$143.88
204%
$437.71
18%
$517.47
5%
$543.95
5%
$571.78
48%
48%
48%
48%
48%
Gross margin (%)
52%
52%
52%
52%
52%
48%
21%
19%
19%
19%
52%
79%
81%
81%
81%
Operating Growth Rate (%)
N/A
2929%
25%
6%
6%
Net income margin (%)
-8%
16%
18%
18%
19%
Net income growth (%)
N/A
677%
31%
8%
8%
Coverage Ratios
Debt / EBITDA
28.5 x
0.8 x
0.5 x
0.4 x
0.3 x
0.4 x
14.2 x
20.9 x
27.4 x
38.9 x
-0.7 x
13.1 x
19.8 x
26.2 x
37.8 x
34
A-3Worst Case Scenario

Image Fashions, LLC
Income Statement

(in $000's)
Year 1
Gross Revenue
Year 2
Year 3
Year 4
Year 5
488.5
1,486.2
1,757.1
1,847.0
1,941.5
$
$
7.3
14.4
$
$
22.3
43.9
$
$
26.4
51.9
$
$
27.7
54.6
$
$
29.1
57.4
466.8
1,420.0
1,678.8
1,764.7
1,855.0
Cost of Goods Solds
224.5
682.9
807.4
848.7
892.1
Gross Income
242.3
737.1
871.4
916.0
962.9
$
$
170.1
14.6
$
$
171.1
44.6
$
$
172.1
52.7
$
$
172.6
55.4
$
$
173.2
58.2
Bad Debt Expense
Credit Card Charges
3.7
11.4
Returned Goods
Discounts
Net Revenue
Operating Expenses
Selling Expenses
Theft/Shrink
13.4
14.1
14.8
14.0
42.6
50.4
52.9
55.6
202.5
269.6
288.6
295.1
301.9
108.0
108.0
108.0
108.0
108.0
Bank Charges
Loan Payments
118.9
128.8
139.5
151.1
163.6
Accounting Expenses
4.0
4.0
4.0
4.0
4.0
Insurance
12.0
12.0
12.0
12.0
12.0
Legal Costs
9.0
10.0
10.0
10.0
10.0
Telephone
1.2
1.2
1.2
1.2
1.2
Rent Expenses
25.1
25.1
25.1
25.1
25.1
Security Expenses
6.0
6.0
6.0
6.0
6.0
284.2
295.1
305.8
317.4
329.9
486.7
564.7
594.4
612.5
631.8
(249.2) $
167.6
272.3
298.7
326.2
130.5


Tax Expense
69.4
108.9
119.5
Interest income
Interest expense
81.4
71.5
49.2
6.0
6.0
6.0
6.0
6.0
146.9
175.7
174.7
173.2
(336.6) $
20.7
96.5
124.0
153.0

$
$
87.4
60.8
36.7
35
Image Fashions, LLC
Balance Sheet

(in $000's)
Assets
Year 1
Year 2
Year 3
Year 4
Year 5
Current Assets
Accounts Recievable
$
$
212.5
26.9
$
$
0.9
54.5
$
$
38.7
57.2
$
$
147.3
60.2
$
$
283.8
63.3
Inventories
116.7
355.0
419.7
441.2
463.7
Prepaid expenses
4.9
5.6
5.9
6.1
6.3
361.0
416.0
521.6
654.8
817.1
18.0
6.0
Long Term Assets
Other assets
$
$
24.0
385.0
$
$
18.0
434.0
$
$
12.0
533.6
$
$
6.0
660.8
$
$
817.1
Current debt
951.9
823.2
683.7
532.6
369.0
Accounts payable
4.9
5.6
5.9
6.1
6.3
Accrued expenses
956.8
828.8
689.6
538.8
375.4
828.8
689.6
538.8
375.4
(156.0) $
122.0
441.7

Total Assets
24.0
12.0
Current liabilities

Long term debt
-$
Total liabilities
956.8
(571.9) $
(394.8) $
Image Fashions, LLC

(in $000's)

(336.6) $
20.7
96.5
124.0
153.0
6.0
6.0
6.0
6.0
6.0
N/A
238.3
64.7
21.5
22.6
N/A
0.8
0.3
0.2
Add
Depreciation
Deduct

(0.8) $
(211.6) $
(0.3) $
37.8 $
(0.2) $
108.5 $
0.2
N/A $
(330.6) $
(0.2)
136.5
-$
-$
-$
-$
-$
Increase in Cash
(330.6) $
37.8
108.5
136.5
543.1
212.5
0.9
38.7
147.3
212.5
0.9
38.7
147.3
283.8

(211.6) $
36
Image Fashions, LLC

Year 1
Year 2
Year 3
Year 4
Year 5
Income Statement
Sales growth (%)
N/A
$61.07
48%

48%
52%
65%
-167%
(%)
N/A
106%
5%
$230.87
48%
5%
$242.68
48%
52%
52%
40%
35%
35%
-4%
60%
52%
34%
65%
66% Operating Growth Rate (%)

62%
-72%
7%
18%
$219.64
48% Gross margin (%)

52%
104%

N/A
204%
$185.78
10%
9% Net income margin
1%
6%
8% Net income growth (%)

366%
28%
23%
Coverage Ratios
Debt / EBITDA
-3.8 x
4.9 x
2.5 x
1.8 x
1.1 x
-3.1 x
2.3 x
4.5 x
6.1 x
8.9 x
-4.1 x
1.3 x
3.4 x
4.9 x
7.7 x
37
APPENDIX BManagement Resumes
38
WILLIAMS, OSCAR
PRESENT ADDRESS:
08907 Valencia
Spain
PERMANENT ADDRESS:
08907 Valencia
Spain
Personal Data: 28 years old, Spanish, single

EDUCATION
2001 - 2003
IESE, UNIVERSITY OF TOLEDO

Master of Business Administration (MBA Program).
Fall 2002
WILLIAMS SCHOOL OF MANAGEMENT

MBA Student Exchange Program
1996 1998
HOGESCHOOL ZEELAND
Bachelor in Commercial Economics
1992 1997
UNIVERSITAT DE TOLEDO
Business Administration Degree
TOLEDO, SPAIN
WILLIAMS, UNITED STATES
VLISSINGEN, THE NETHERLANDS
TOLEDO, SPAIN
EXPERIENCE
Summer 2002
Dell
BARCELONA, SPAIN
Summer Internship (IESE)
Developed a marketing plan for the banking group to improve DElls business on Commercial and Investment Banks.
Feb. 99-Oct. 01 Dell
BARCELONA, SPAIN
Key Account Manager: Personal System Division (PSG)
In charge of three Dell Business Partners.
Responsible for achieving annual sales objective of more than US$40 million.
Coordinator of a project (budget of US$20 million) for renewal of all PCs in the office network
of a bank. Liaison between departments, both Spanish and foreign, to fulfill requirements set by
the client to win the bid.
Presented products to clients and distributors.
Awarded with the "EMEA Leadership Award" twice (only 160 p eople from IBM Europe are
awarded quarterly).
Feb. 98-Dec. 98 BLUE, S.A.
ESPLUGUES DEL LL., SPAIN
Financial Analyst
Carried out financial analysis of the policies for the marketing and sales department as well as
studies to impro ve processes. Monthly reporting to the head -office in Germany.
Feasibility study for Braun Espaolas subsidiary in Portugal.
Jul. 97-Jan. 98
NEXT VIEWING SYSTEMS

COSTA MESA (CA), UNITED STATES
High-quality printer manufacturing company wit h a total staff around 200
Assistant, International Sales and Marketing Department
Serviced sales network at international level for countries throughout the world with total control
for South America with regard to distributors and campaign designs.
Located new distributors in countries with no representation.
Summer 1996
CAIXA DE SABADELL
SABADELL, SPAIN
Administrative Assistant, Payment Methods Department
Provided service for the complete network of offices, clients and financial companies.
Previously worked from June to November 1995 in an office dealing with the public.
LANGUAGES
Spanish
English
Mother tongue
Proficient
Catalan
French
Mother tongue
Fair
ALLEN GREEN
5540 North Drive # 16H Williams, IL 60657
EDUCATION
2001 Present
WILLIAMS SCHOOL OF MA NAGEMENT

Candidate for Master of Business Administration degree, June 2003
Candidate for Master in Engineering Management degree, June 2003
Majors in finance, marketing, management & strategy, entrepreneurship
Member, Finance Club, Marketing Club, Scuba Diving Club
Williams, IL
1992 1996
WILLIAMS UNIVERS ITY

Bachelor of Science in Mechanical Engineering, December 1996
Bachelor of Science in Manufacturing Engineering, December 1996
Williams, IL
EXPERIENCE
1997 2001
DELRAY CONSULTING
Williams, IL
Consultant
Telecommunications Provider Customer Care and Billing System Implementation
Led a multi-national system testing execution team (9 client, contract, and firm employees). Developed business
scenarios used to identify and resolve over 1,000 defects during system development. Managed responsibilities
between Israeli, French, and Canadian teams.
Broadband Provider Inventory Visibility Analysis

Assessed the current inventory tracking method and recommended new processes. Facilitated selection of
software to address cable system inventory visibility issues.
Electronic Components & Computer Distributor Financial ERP Planning Project

Led accounts receivable team. Assessed and developed new order to cash cycle processes.
Delray Consulting InformationPrint Approach Development Internal Project

Developed a matrix of financial performance metrics for various corporate functional areas.
International Game & Entertainment Developer Financial ERP Implementation

Managed accounts receivable team consisting of 2 System Analysts and 6 client personnel.
Midwest Truck & Automotive Supplier Manufacturing ERP Implementation

Developed the financial business requirements for a manufacturing plant opening in Mexico.
Midwest Utility Company ERP Software Selection Project

Developed detailed project cost model for ERP package implementation.
Nations Largest HMO, Member Service Center Call Center Optimization Project
Identified Call Center management weaknesses and made recommendations regarding processes,
FTE scheduling, and FTE productivity measures.
Summer 1996
SUNRAY MOTORS
Soot, MI
Design Engineer Intern
V6 Engineering Center Product Design Internship
Responsible for the design modifications, testing, and analysis of a p rototype intake manifold.
Summers 1995,
1994
ENGINEERING LOGISTICS COMPANY

Freeburg, CO
Process Engineer Intern
Engineering Logistics Company Manufacturing Optimization Internship
Designed a new manufacturing layout for two flow meter lines, including a new parts handling and storage
system.
Engineering Logistics Company Quality Assurance Internship
Facilitated the implementation of ISO 9003 international quality control standards.
OTHER DATA
Conversant in German travel Europe extensively, family resides in Germany and Austria.
Interests include photography and scuba diving.
41
JON SMITH
1955 Warren Avenue #523
Wiliams, Illinois 60201, USA
EDUCATION
2001-Present
1990-1995
EXPERIENCE
Summer 2002
1996-2001
WILLIAMS SCHOOL OF MA NAGEMENT,

Williams, IL
WILLIAMS UNIVERSITY
Candidate for Master of Business Administration degree, June 2003.
Intended majors in management & strategy, finance, and international business.
Leader, Global Initiatives in Management class and trip to Vi etnam.
Recipient of Jansons scholarship, awarded to accomplished Norwegians with potential to significantly impact
Norwegian industry.
Member of general management, consulting, finance and public speaking clubs.

SCANDINAVIAN INSTITUTE OF TECHNOLOGY
Stockholm, Sweden
Master of Science, Engineering Cybernetics, December 1995.
Co-Chair of Erasmus European Student Exchange Network.
Head Instructor of NTHI Tae Kwon Do club. Trained Norwegian and European Champions.
DUTCH BANK
Summer Associate, Global Investment Banking - Mergers and Acquisitions
Bristol, UK
Member of a sell side team for a live M&A deal in the UK. Responsible for setting up due diligence
meetings for potential buyers and participated in discussing the terms of the final bid.
Participated in a 125MM High Yield offering. Drafted the Offering Memorandum and performed
company/financial due diligence. Prepared client senior management for debt rating agency meeting.
Performed a broad range of corporate finance duties including comparable company, comparable
transaction, strategic analyses and preparation of pitch book and various management presentations.
ALLRIGHT TECHNOLOGY
Swedish consulting firm providing high-end IT, e-commerce and marketing services.
Director
North Pole, Norway
Promoted to Director, Oil & Gas Division in 2001. Youngest director in companys history.
Senior Consultant Information System Group 1996 -2001
Houston, TX & Caracas, Venezuela
Earned early promotion as youngest leader of $90 MM project implementing the worlds most
advanced control system for oil and gas production for the Venezuelan National Oil Company (PDVSA).
Led global cross-functional teams of 3 to 8 consultants and client personnel in all aspects of
development of information systems to support clients water injection, oil treatment and water treatment
operations.
Shortened waiting time of lab results from 2 days to 4 seconds, potential annual saving of $1.5 MM in
reduced chemical consumption.
Implemented system for corrosion monitoring in pipelines, expected savings of over $ 1M annually.
Designed treatment systems, significantly increasing probability for accurate and timely crude
delivery to external clients, saving daily fines as high as $150 K and rerouting costs.
Managed relations with clients middle management, including contract negotiations.
1995-1996
INDEPENDENT AS
Norways largest software house.
Software Programmer
Stavanger, Norway
Implemented system currently used by over 75 % of all Norwegian municipals for healthcare
reporting
Reprogrammed 3000+ users healthcare system from UNIX to Windows.

4
2
BARRY MILLER
1544 South Ave, Apt. 1S, Williams, IL 60626
EDUCATION
2000-Current

BINGO SCHOOL O F ENGINEERING
Williams, IL
Candidate for Master of Business Administration degree, Class of 2003

Candidate for Master of Engineering Management degree, Class of 2003
Majors: Finance, Entrepreneurship & Innovation and Management & Strategy
Select ed as a leader for the Southeast Asian management studies program
Awarded the first Student Leadership Honor for work in the Neighborhood Business Initiative
Club Memberships: Investment Banking, Finance, Entrepreneurship & Venture Capital, and
Business Leadership
1991-1996
ZURICH COLLEGE
Gettysburg, PA
Bachelors of Science in Chemical Engineering with Minor in Business Administration
Received a Varsity Football Letter and Eddie Hartman Award for Service and Character
Paid for degree with work-study programs and summer construction projects
EXPERIENCE
2002
RAR CORPORATION
Wood Dale, IL
Summer Associate, Mergers and Acquisitions
Identified and investigated strategic acquisition targets for a $700M aerospace/Defense company
Provided comprehensive and detailed analysis, including financial considerations, organizational structure and
strategic rationale, for CEO and Board of Directors for a $12M acquisition
Performed synergy and financial valuation analysis including merger pro forma projections, earnings,
accretion/dilution, discounted cash flow and common stock comparisons
2001-2002
MILLENIUM INVESTMENT GROUP
Beirut, Lebanon
Business Development Officer
Developed and e xecuted diversified investment strategy for a Jordanian private equity firm
Provided strategic rationale and financial analysis of international investment opportunities, including potential
venture partners, to executive officers
Managed cross-border client contact
Defined preliminary fund structure for a multinational grant program, called The Qualifying Investment Fund,
to use business incentives to improve the Jordan-Israel peace treaty
1996-2000
NEXT PHYSICS, INCORPORATED

Operations Engineer/Q uality Leader, 1999-2000
Managed Quality Department budget and personnel resulting in a 20% decrease in operating budget
Developed and implemented an operational strategy resulting in improved labor effectiveness and utilization
Improved material management by designing a process control program to reduce costs by $230,000/year
St. Lou, IL
Quality Process Engineer, 1996-1999
Led department reorganization resulting in $1.25M in savings and a 25% work force reduction
Designed Internet -based system to improve communication between customers, logistics and operations and to
save $500,000 in material handling costs
Received 3 separate awards for contribution and customer commitment
Raca, PA
ADDITIONAL ACTIVITIES
2000-Current
NEIGHBORHOOD BUSINESS INITIATIVE
Williams, IL
Founder and President
Started a volunteer-based consulting organization to aid businesses in under-resourced neighborhoods
Directed all aspects of organizational activities, including capability assessments, corporate partnerships,
infrastructure design, marketing, project development, project management and recruitment
Organization has grown to 140 volunteers
Organization has completed 8 projects and is engaged in an additional 15 projects
COMMUNITY SERVIC E
Led 11 volunteers in building projects in the Dominican Republic and Costa Rica
Volunteer martial arts instructor for at -risk high school students in Elgin, IL
Led summer camp for 70 inner city children in Pittsburgh, PA
INTERESTS
Hiking and Mountaineering, International Travel, Philosophy, Rock Climbing, Theater and Wine
43
WILL SHARPE
1941 New York Avenue, # 301, Williams, Illinois 60201
EDUCATION
2001-Present
WILLIAMS SCHOOL OF MA NAGEMENT, WILLIAMS UNIVERSITY

Williams, IL
Intended majors in Management & Strategy, Finance and Marketing.
Elected as Global Affairs Representative of student government and developed Williams Globe website.
Team Captain for AT Kearney Global Prize Consulting Competition.
Member of Finance Club, Consulting Club, Private Equity and Entrepreneurship Club.
1994-1996
GUMBO UNIVERSITY
Master of Science degree in Electrical Engineering, May 1996.
1991-1994
GEORGIA TECH
Bachelor of Science degree in Electrical Engineering, May 1994.
Graduated Magna Cum Laude, Deans List, Completed 4-year program in 3 -years.
Elected Social Chairman of Tau Beta Pi National Engineering Honor Society.
EXPERIENCE
Summer 2002
1996-2001
Leslo, IN
Blacksburg, GA
BLUEFRONT NETWORKS
San Jose, CA
Summer Associate, Corporate Strategy and Business Development
Developed business case and financial model to preserve #1 market share and stimulate new revenue
opportunities with top global clients.
Conducted gap analysis of corporate marketing strategy against major competitors and recommended actions
to bolster industry leadership position.
COMPUCHESS LIMITED
Singapore
Regional Business Manager, 2000-2001
Spearheaded business development activities and formulated marketing strategies by focusing on specific market
requirements and value creation methodologies.
Managed complex cross-border proposals valued at over $130 Million, requiring extensive project management,
negotiation and analytical skills.
Conducted presentations to senior executives of lead ing global service providers at international telecom
conferences, leading to new account opportunities worth $8 Million.
Strengthened relationships with global alliance partners to deliver value-added solutions.
Analyzed bottom-line profit drivers and evaluated competitive benchmarking of product portfolio.
Selected for Year 2000 Employee Recognition Award, given to top 5% of 7,000 global employees.
Regional Systems Sales Specialist, 1997-1999
Achieved sales revenue growth of 300% over 2-year period, despite economic downturn through focused
marketing efforts and dedicated relationship building.
Designed product positioning and pricing strategy for regional offices and channel partners.
Advised on creation of global customer service organization to offer professional services, generating
more than $2 Million in revenue and enhanced customer satisfaction metrics.
Reengineered configuration tools to improve sales request response time from 2 days to 1 hour.
Promoted from Systems Engineer after one year with greater product management responsibilities.
44
GEORGE MICHAELS
1725 Blink Avenue, #527,Williams, IL 60201
EDUCATION
2001-present

Williams, IL
Intended majors in Finance, Management & Strategy and Marketing.
Selected to Deans Ho nor List.
Selected to represent Williams at the Economist Magazine Business Schools Challenge in Canada.
Runner-up, Williams Global Prize Consulting Case competition (out of fifteen teams).
Editor, Williams 2003 Yearbook and elected section representative (o ut of 68 people).
1993-1997
DUN SCHOOL OF ECONOMICS

Dun, England
Master of Science in Political Economy, September 1997.
Bachelors of Science in Economics (honors), June 1996.
Financed whole education through 50% scholarship and working as a televis ion news producer.
Briefed British Foreign Office diplomats for inter-governmental conference negotiations with Germany.
EXPERIENCE
Summer 2002
(six weeks)
ENGLISH BROADCASTING CORPORATION (EBC)

London, England
Associate, Finance Planning and Analysis
Reported directly to Chief Operating Officer, BBC News.
Coordinated a structural and organizational review of BBC News divisions to extract cost savings of $23mm a
year on an annualized basis across interactive, radio and television platforms.
Summer 2002
(nine weeks)
OLD MEXICO MEDIA

Los Angeles/San Francisco, CA
Business Development Associate,(a marketing agency focusing on the ethnic markets).
Managed a six people cross-functional team to develop and launch new media directory product o n both print
and interactive online platform.
Prepared business plan and proposal that generated $125,000 product sponsorship covering development costs
for the first two years.
2000-2001
INTERNATIONAL IMPROVEMENTS GROUP (IIG)

London, England
Financial Analyst, IIG. Reported directly to CFO.
Managed financial relationship with IIGs largest client. Dealt directly with client CFO and COO on project to
create worlds first converged media network (client billings of $7 0mm per year).
Implemented financial and management reporting procedures and organizational structure charts for 450 staff,
prepared forecasts and monitored cost center variances against budgets.
Devised new budget and capital expenditure processes that reduced time to approval from client by 70%.
Negotiated payment schedule with client, resulting in payment of $20mm six months before due date,
improving profit margins on the project by 28%.
Prepared and presented business cases for projects which were approved by client and resulted in increasing
revenues from client by $5mm.
1997-2000
ASSOCIATED PRESS TELEVISION NEWS (APTN)

London, England
Television arm of the Associated Press. Revenues grew from $18mm in 1997 to $110mm in 2000.
Budget Accountant, 1999 -2000.
Budgetary responsibilities were in excess of $100mm and located in over 60 countries.
Monitored costs and revenues from profit centers against budget.
Marketi ng Analyst, 1997 -1999.
Member of due-diligence and integration teams on acquisition and merger of Worldwide Television News
(Integration team given special bonus for outstanding work (for only third time in 150 years).
Developed market projection, pricing model and business plan for an industry -first joint venture with Ziff Davis to create a Technology News Feed.
OTHER DATA
Fluent in Hindi; volunteer teacher at a local school (one afternoon a week); Struggling golfer and avid
cricketer (played in a competit ive London league). Co-chair and Treasurer, Sports Business Club
45

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A Business Plan for Inner City Apparel Retail Providing the Latest in Hip Hop and Urban Fashions

Cost of Goods Solds

II. The General Market

A. General Market Definiti on

Competitive Inner City, June 1998.

Illustration 1: Annual Apparel and Service Expenditures by Race

Total Inner City

B. The Chicago Market

Illustration 2a: Average Per Capita Income by ZIP Code 7

Source: Analysis of U.S. Census Data

Illustration 2b: Total Apparel Expenditures by ZIP Code 8

III. Image Fashions Marketing Model

Illustration 4: Image Fashions Marketing Model

Being treated with respect

Interview, November 9th 2002.

Illustriation 5: Image Fashions Brand Licenses

Illustriation 6: Image Fashions Price and Per Purchase Revenue

IV. Competitive Environment

A. General Competitive Landscape

Local urban speciality retailers such as The Lark, Freshwear, Manalive

B. Site Specific Competitive Landscape

Illustration 7: Local Competitive Analysis

Illustration 8: Competitive Analysis and Apparel Expenditures at Site Location

Illustration 9: CTA Bus Routes near 7400 South 16

Source: Illinois Department of Transportation, Average Daily Traffic

Source: Chicago Transit Authority, south west system map

Illustration 10: Store Layout

Ramped and Glass-walled Entrance / Exit

Illustration 11: Number of Crime Occurrences 17

Chicago Police Department

E-mail interview with Chun Yee Yip, Buyer, Ann -Taylor.

Illustration 12: Store Operating Hours

Total number of store managers: 2 full time.

VI. Financial Analysis

Illustration 13: Market Share Scenarios

IF Market Share for

Gross Revenue (Fully Operational)

Illustration 14: Financial Projections for Image Fashions.

from Income Statement

from Income Statement

Net Cash Flow from Operating Activity

Outstanding Current Debt

from Cash Flow Statement

from Balance Sheet

B. Comparative Financial Performance

Illustration 15: Comparative Performance Metrics 19

*Note: Percentages based upon Net Revenue

Illustration 16: Start Up Costs

Illustration 17: Sources of Funding

Mike Lowe, Director of Ethnic Marketing, Old & Circle

VIII. Timelines and Next Steps

Illustration 18: Timeline of Activities

APPENDIX AFinancial Analysis

A-1Most Likely Scenario

Image Fashions, LLC

For Year Ending December 31, 20xx

Cost of Goods Solds

Sales Salaries & Expenses

Bad Debt Expense

Credit Card Charges

Administrative Salaries & Expenses

Total Selling Expenses

Total Operating Expenses

Net Income from Operations