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Business Report

APRIL 12 G20180133 Authored By: Daniel Lim Zhu En For: Bernard Lim

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Contents Executive Summary ....................................................................................................3 Market Opportunities .................................................................................................4 Market Overview - PESTEL ..........................................................................................5 Secondary Market Research .......................................................................................8 Primary Market Research ...........................................................................................9 The Brand .................................................................................................................11 Business Model.........................................................................................................14 Competition, Positioning & Pricing ...........................................................................15 Financial Plan............................................................................................................20 Production Plan ........................................................................................................22 Specs & Costing ........................................................................................................24 Sample Costing Sheet 1 .........................................................................................25 Retail Business Overview ..........................................................................................26 Retail Location & Space ............................................................................................27 Retail Theatre ...........................................................................................................29 Stock Allocation - Costing .........................................................................................31 Stock Allocation In-Store ..........................................................................................32 Marketing Plan .........................................................................................................33 Conclusion & Recommendations ..............................................................................34 Bibliography .............................................................................................................35 Appendix 1 ...............................................................................................................37 Appendix 2 ...............................................................................................................46 Appendix 3: Financial Statements .............................................................................50

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Executive Summary With a rising trend in men purchasing and experimenting with new fashion styles, the menswear market is set to go on an upward trend and might overtake women’s wear one day. This is all thanks to social media and men’s changing habits. While the menswear market looks promising, retail has been on a decline. But is the decline truly reflective of consumers shopping less? The answer is no. As consumers evolve so have their habits, and the bridge between online and offline are blurring. Retailers must connect the bridge and create a seamless experience. This is what Order aims to bring to the table. Order is a menswear brand who will launch in Singapore. Bring the very best of its minimalist designs which last beyond seasons to a its target market of educated gentlemen who discuss quality and design before price.

Order will most likely operate in a favourable environment if it adopts the current strategies of omni channel and experiential retail. With the COS fashion brand doing well around the world, it would be smart to ride on its success.

As with any business, Order plans to expand after the first 3years. Opening 1 more boutique and expanding its presence overseas. Although the company require investments from external parties to fund its start-up, based on financial statements and forecasts, it shows to be a profitable business.

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Market Opportunities On a global scale, the fashion industry is set to be on a rebound from previous years. However, it is not being felt evenly across the world. The year 2017 indicates the end of an era, as the Western world will no longer reign supreme pertaining to fashion sales—more than half of apparel and footwear sales will happen outside of Europe and North America. The main sources of growth are from countries across the Asia–Pacific, Latin America, and other regions; they are forecasted to grow at rates ranging between 5 and 7.5 percent in 2018. (Imran Amed, 2017)1

Meanwhile, the Menswear industry itself which has historically played second fiddle to womenswear, is showing immense growth that point to changes in the way men dress and experiment with style. Global Menswear is forecasted to grow at a quicker rate than womenswear over the next few years, with net gains of 2.3% and 2.2% respectively, according to data from retail analytics company Edited. Furthermore, the menswear market is estimated to be valued at $33 billion by 2020, an increase of 14 percent from 2015. (Smith, 2016)2

Locally, the forecasted Singapore apparel market value from 2018 to 2022 is set to go on an upward trend over the next 4 years. (Statista, 2019)3

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Market Overview - PESTEL Politic According to Singapore Business Review, in 2018, Singapore remains one of the top two counties in the political stability indicator (79), closely behind Japan. The nation ranked first in many political indicators, including foreign trade and payment risk (96), trade costs (81), tarriffs and non-tariff barries to trade (100). It is also noted that Singapore has the lowest trade costs among all the economies studied. (Charlton Media Group, 2018) Singapore’s terrorism index remains zero in 2018. Leadership transitions within the country have also been handled carefully by the parliament leaders. A decision to select the next successor to the nation’s current Prime Minister, Lee, has too hit a consensus in the central executive committee (CEC), with Finance Minister Heng Swee Keat poised to be Singapore’s next PM. (South China Morning Post Publishers Ltd, 2018) Economic

In Singapore, consumer spending has increased to 38850.5 SGD Million in the fourth quarter of 2018, up from 38374.4 SGD Million in the previous quarter in 2018, and that is some good news. (Trading Economics, 2019) The statistical figure is shown below.

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The apparel industry in Singapore has achieved an entire sales figure of S$4.4 billion, with a stream of suppliers for international brands such as Gap, Nike and Macy’s. Local fashion brands like Charles and Keith have also received continuous worldwide recognition, turning into into international brands itself. (Enterprise Singapore, 2018) Based on the information provided by Department of Statistics Singapore, Real GDP Growth in 2018 was 3.2%. (Department of Statistics Singapore, 2019). Favourably, wholesale and retail trade makes up 18% of the nominal GDP in Singapore.

Social Consumers are no longer brand loyal and are becoming more brand loyal. There is a significant shift in customer shopping patterns from in-store to online experience. Hence, physical locations are now turning into experiences centres instead of just a place to purchase apparels. Shoppers find it easier to chat with a retailer via digital communication channels as opposed to visiting physical store. 6


They avoid visiting stores when they require product information yet feel that the total removal of physical stores is not an ideal move, brick and mortar stores must work alongside with their e-commerce sites to provide a satisfactory shopping experience. According to the ‘Customers 2020’ study by Walker, a customer intelligence consulting firm, it is highlighted that customer experience will supersede price and product as the key brand differentiator by the year 2020. ( KPMG International Cooperative , 2018) Technology

Technology has a huge impact on the growth of the fashion retail industry. There are two aspects found in the technological factor. The first one being Mobility, which comprises mobile applications, mobile payment options, real-time promotions and integrated return services. The second aspect to take note of is the E-Commerce. In the 21st century, the world itself is seeing a tremendous presence of ecommerce in the fashion retail industry. All of which the brand has to consider integrating the technological component with its physical store. Environmental

Minimising carbon footprint has been a concern among many fashion brands. Locally, Singapore has been faced with poor scores in air pollution (61 points) due to transboundary haze pollution. The nation itself has however been taking stringent measures on enhancing local air quality standards. The fashion industry has recently focused more in making larger investments on purchasing environmentally friendly raw materials both for its production and operations. Sustainability must coexist with the environment. Legal

There are not many legal challenges found in Singapore’s fashion retail industry, where ethics and compliance mainly impact larger key players such as H&M and Zara. Labor laws and other business laws will continue to affect brands to conduct their operations in compliance with the various laws existing in Singapore.

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Secondary Market Research Consumer Behaviour With an expansion of the menswear market highlighted in the previous chapter, it could largely be attributed to social media’s role in building visibility around men’s fashion, lifestyle changes and accessible e-commerce.

Men in the age range of 25-34 are key factors in the market, with as high as 94% of the age group having bought clothing in the past year, the highest rate across all age groups. Research demonstrates that men are four times as likely to prefer to buy classic styles that will last beyond seasons as compared to buying the latest fashion. Proving quality counts, men are also more likely than women to spend more on quality clothes that last, with 70% of male shoppers agreeing to this, compared to 64% of female shoppers. The importance of buying quality clothing rises to 76% of men aged 16-34. (Mintel Press Team, 2018)4 Consumer confidence is making a return due to an improving economy with a moderate rise in overall wages. In men’s outerwear (less jeans) men’s shorts and trousers was one of the most active categories, with it growing rapidly. Men in Singapore tend to dress rather conservatively due to the hot and humid weather thus a lesser demand for suits and jackets, with the preference being for smart shorts, trousers and shirts. (Euromonitor, 2019)5

With a robust growth in the menswear market, an increasing number of retailers are focusing their attention on men’s clothing and targeting this category to generate sales. With that in mind, there is a multitude of untapped opportunities as an apparel retailer as men become progressively invested in their personal style. These trends and research statistics indicate substantial evidence that launching a menswear clothing brand in Singapore targeting men in the age range of 22-34 will allow it to operate in a very favorable environment.

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Primary Market Research Consumer Behaviour The Target Customer: A typical Order customer is a university student or working professional belonging to middle and upper management ranging from the ages 22-34. They are educated, creative, cultivated in their interests and highly individualistic and self-motivated. Having a keen sense of style, they are constantly experimenting with their image. Competing for upper and middle-class discretionary dollars in the fashion market. They belong to the ‘’Millenial’’ demographic range. Whom are actively connected through all forms of social media, tech savvy, socially concious and demand instant gratification. Below is a customer profile which highlights the characteristics of the key type of customer for Order.

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Analysis of Primary Research Conducted

PLEASE REFER TO FULL SURVEY ATTACHED TO APPENDIX 1 AT THE BACK OF THIS REPORT

According to primary survey conducted, it has debunked the myth that men in the (22-34) age group of an educated background don't like shopping for clothes often. This substantiates the forecasted growth in the menswear market. Although these men are more likely to shop offline, online shopping is gaining traction and catching up. They prefer taking a logical approach of researching thoroughly a product over online channels before planning a purchase. They are willing to spend on average $88 on a piece of clothing and are open to new brands without a need to follow trends. Their preferred shopping destination in the city is Ion Orchard and they tend to shop with their partners and friends. They are influenced by social media and celebrities with a penchant for music and sports. Priorities in clothing are quality, comfort and an emphasis on minimal/sporty styles.

Recommendations:

- To launch a menswear brand which sells quality minimalistic designs - Retail store location to be in Wisma Atria - The brand will take an omni channeled approach: connecting the physical store, online store, social media platforms and mobile applications. - The physical store will be experiential in tune with music and sports. - Celebrity endorsements and influencers for advertising. - Promotions based on who they shop with and how they shop.

These factors will be applied in the later chapters of this report.

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The Brand

The arrangement or disposition of people or things in relation to each other according to a sequence, pattern, or method. The three principles of Order are sequenced: Modern, Practical, Considered.

A quiet rebel in a world of high street and flash, Order is a menswear brand whose products exercise a minimalist approach, not overworking designs. Garments are made to be timeless and worn beyond the seasons. Made for individuals who value the subtle details and patterns scattered across this vast universe.

From a design standpoint, Order believes that beauty is important alongside practicality. Designs draw inspiration from simple geometric shapes ranging from the likes of rectangles, circles, triangles and even simple lines. Geometric shapes are the ones we first learn about as little kids. They're the simplest, most common shapes of all: Most geometric shapes are symmetrical and instantly recognizable, a fundamental building block of our lives.

Be it from large visible shapes to tiny lines on a garment, these fundamental structures will be incorporated into each and every piece in some form or another. Order does not make mass-market products. Distinct products for distinct people, each of its products has its own explicit profile with each its own explicit job to do in the market. In short, Order puts a twist on fashion staples. The following two pages illustrates the Colour Board, Mood Board, Design Inspirations & Final Concept for Order.

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Business Model Order has a dream for a cohesive retail experience, where technology can improve efficiency and create seamless platforms to connect to customers. Order will have a store of the future. A retail resolution that links online and offline channels, using data to augment and generate a unified buying process for customers.

An Overview of the plan -

One Brick & Mortar Store, E-commerce site and POS system. Store sales associates are equipped with tablets which display an app. Smart screens around the store display the app as well. Enabling staff to give on-the-spot, product information and view customer data. Providing personalized experiences. - Customers can make purchases from multiple avenues within the store- from their own phone, from the staff or the smart screens. In-store WIFI provided. - From the app/website purchases can be delivered directly to customers home or click and collect, attracting footfalls in store. 14


Competition, Positioning & Pricing Order’s competitors are determined based on similar design aesthetics, price range and target market segment. This portion of the report will focus on two main competitors – BLACKBARRETT and COS.

BLACKBARRETT will be Order’s upscale competitor. They have a flagship store located at Paragon Singapore. The Neil Barrett fashion brand has been at the forefront of minimalist menswear, delivering innovative and distinctive designs, blending sartorial and athletic elements. The hallmarks of the label are modern interpretation of timeless staples, masculine and ageless with acute attention to fit, fabric development and accurate detailing.

BLACKBARRETT is Neil Barrett's second line collection and is an extension of his main line. The brand carries the DNA of his mainline fits, offering a comprehensive wardrobe from an accessible price point. BLACKBARRETT shapes seasons with collections of modern sartorial staples, with an aim of creating a contemporary and timeless wardrobe.

Typical average prices range from $160 for T-shirts and tops; $520 for outerwear; $220 for shorts and pants.

( BLACKBARRETT by Neil Barrett)6

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COS will be Order’s main and direct competitor. H&M’s business has not been doing well, but other its other group brands have been performing better, according to the company’s CEO, Karl-Johan Persson. One of such brands is COS.

Cos, which was launched in 2007, is a brand focused on minimalist designs sold in a modern environment. Delivering a range of reinvented classics and wardrobe essentials, they create pieces that are made to last throughout seasons. Traditional approaches and new practices combine to form timeless, understated collections.

Since their launch, COS has opened stores worldwide in sensibly measured locations, applying an architectural design concept that preserves a buildings original features whilst creating a modern, welcoming space. COS also managed to find the missing link and gap in the fashion market: Design quality apparel at an affordable price and this success is helping to make up for H&M’s unsatisfactory run. Its strategy contrasts its sister brand, of whom attempts to follow trends and sell a profusion of styles in stores. COS is Located at ION Orchard and Jurong Westgate in Singapore. Their prices for tops range from $49 to $359 and bottoms from $109 to $159.

(COS)7

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Order aims ride on the success of COS and to bridge the gap between mass market brands such as H&M and Zara while positioning itself as an alternative to COS with a more affordable range of garments when compared to BLACKBARRETT. Below on the perceptual map highlights where Order wants to be positioned –

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As a new brand to the market, Order is aiming to achieve a strong brand equity with its minimalist designs and subtle creative twists. With a launch in 2019 where social media and the internet can aid in gaining brand exposure, opportunities are boundless. However, with its slightly pricier price tag than brands such as H&M, Topman, Zara or even Uniqlo, it may fall prey to budget constraints and the economy.

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Based on primary research and competitor pricing, Order’s prices have been carefully selected to satisfy the demands of the target market. The price range in comparison to COS are illustrated in the figure below:

These prices reflect the 70% intended for the main line collection. The market level is ‘’Slightly above Mid-market’’. This is to ensure Order remains affordable while maintaining an exclusive brand image. PRICE ARCHITECTURE

10% - Premium 70% - Main line 20% - Basic

A simple formula is concocted for the above Based on the average price range of main line Premium – 150 % (E.g 1.5 x $98 for shirts) Basic – 70 % 19


Financial Plan Based on average prices, Order aims to sell on average 14 pieces of clothing every weekday and 16.8 pieces every weekend. That equates to ~414 pieces every month. The ratio of sales by item type are :64% Tops, 21% Bottoms and 15% Outers. This ratio will be reflected in an assortment plan on page 28. The table below illustrates the forecasted sales figures:

The company will require 6 months’ worth of inventory as start-up inventory. Based on Sales Forecast, from January to June, the cost of goods required is $67,250 in total. A basic renovation to the aesthetics of the retail store is estimated to cost $15k. Start up cash required would be about $7,500. Hence the total startup funds, based on the figures shows to be $190,238.

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Summary of Financial Analysis This is a summary of the complete financial analysis. For individual detailed financial statements, please refer to appendix 3 of the report.

Looking at sales forecast, the net sales profit for the next three years proves to be optimistic. Year 1, 2 and 3 net sales profit are noted to be $390,000 ; $468,000 and $561,600 respectively. This is an increase of 20% every year with the assumption that sales improve due to increased brand awareness and referrals from existing customers.

The average breakeven per month is estimated to be $28,853. If you look at the net earning per month under the monthly income statement, the total annual net earnings for the first year is recorded at $76,743, after deducting all operating costs and expenses which also included employee wages and depreciation of equipment. Expanding further into three years from business operation, the net earnings are notably increasing over the years, from year 1 at $76,743 to year 2 at $89259 and to year 3 at $163,840, a significant increase in net earnings throughout 3 years. Branching into cash flow which addresses the cash liquidity of the business operation, the annual cash balance proved to be a comfortable and well supported figure. At the end of year 1, cash balance is estimated to be $205,468 and in year 2 $533,936 and in year 3 at $987,204. These figures confidently reassure any investors or participating shareholders of the viability of Order.

In summary, the viability of Order proves to be optimistic and favourable. Despite facing a few low peak months which directly impacted the net earnings per month, the business can recover total higher net earnings at the end of the year. Sales revenue are expected to increase over the next 3 years, and the company will continue to enjoy higher cash liquidity as the business blooms in the next few years.

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Production Plan In the first few years of operation, Order will begin producing and outsourcing manufacturing to devoted service providers. The company will set up a proficient supply chain management that allows reduced costs and delivering flexible and punctuality. Supply chain management is a major component for new fashion labels. Good supply chain management entails close communication with suppliers, warehouses, logistics firms and the client. To do this, Order will employ BrydenApparel’s services. Bryden is a Singapore based company which serves independent fashion labels, big companies and ecommerce retailers with sourcing and garment production requirements. They are able to handle the entire supply chain process from designing, creating tech packs, sourcing for fabrics and trimmings, creating samples, bulk apparel production, packaging, quality control valuations to placing delivery of the products.

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For custom pieces, Bryden has a low MOQ of 500 pieces per ORDER starting from $8k SGD. The short lead times usually take 4-6 months to be completed using stock fabric and 6-8 months for custom produced fabrics. Sourcing 5-7 days

Tech Pack 10-14 days Samples

30-45 days for non-embroidered/printed designs, and 60 days for embroidered/printed designs Resamples

21-30 days for non-embroidered/printed designs, and 30-45 days for embroidered/printed designs Production

45 days for non-embroidered/printed designs, and 60 days for embroidered/printed designs

Once the process is completed, various shipping providers like DHL, FEDEX, will ship the orders by air freight in 4-5 business days to Singapore. Thus, the reason for employing Bryden is simple – Ease of communication (Singapore based company), low MOQ, fast lead times and are ability to handle the entire production process from start to finish. (Bryden Pte Ltd, 2019)8

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Specs & Costing Line Sheets are integral to any fashion business or brand looking to wholesale their collection. It is a sales tool created to communicate necessary information about the product to a potential stockists. Unlike a look-book, the line sheet provides an easy reference for a buyer looking to place an order. A sample line sheet has been drafted for future use should the sales and distribution strategy change. Costing sheets have also been drafted to illustrate the fabric usage and details relating to garment production.

A sample of 1 costing sheet is displayed on the next page for reference. Please refer to appendix 2 for the rest of the costing sheets. Order employs an elementary method of pricing – Keystone markup method. (Garment Cost x 2 = Wholesale x 2 = Retail)

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Sample Costing Sheet 1 Style Number: ODS 001 Description: Short Sleeved Shirt With Patterned Collar & Hidden Plackets Fabrics: Cotton Poplin / Printed Broadcloth Size Range: XS, S, M, L

Materials

Yardage

Price/Meter

Total amount

Fabric Body

1.5m

10

15

Fabric Collar

0.5m

8

4 Total Amount = $19

Trims

Amount

Cost Each

Total amount

Button

8

0.25

2

Zippers

-

-

-

Others

1 Clasp

0.50

0.50

Total Amount= $2.50 Cutting & Sewing

$8.50

Grading & Marking

$2 Total Amount= $10.50

Total cost of garment: $32

Suggested retail price: $128 (300% Mark-up & 75% Margin) 25


Retail Business Overview Before venturing into the retail business of a given country, an analysis must first be done to check for a suitable environment.

The retail industry constitutes 1.4% of Singapore’s GDP and 3% of the workforce. However, traditional retail stores are struggling to stay relevant, with rising costs, declining sales and disruption from e-commerce. The decline in local retail mirrors the global drop in performance of the retail industry – according to Business Insider, in 2018 alone, more than 3800 stores have closed worldwide. The decline does not reflect on people shopping less. While retail sales decreased, online shopping has increased. A study by Visa ranked Singaporeans as the biggest online shoppers in the South East Asia region, with Google and Temasek Holdings reporting that Singapore’s e-commerce industry to value at S$7.5 billion by 2026. (Hawksford Group Services Limited , 2019)9

Two key trends are set to aid Singapore’s retail scene, omni-channel and experiential retail. As customers are commencing their journeys through online platforms and search engines, retailers who utilize digital platforms and storefronts to complement their brick-and-mortar stores benefit from increased brand awareness. A study conducted by Singapore Management University’s Institute of Service Excellence discovered that patrons who shopped at both online and retail stores had higher satisfaction, increased brand loyalty, and spent more than patrons who only shopped at the physical retail store. (Hawksford Group Services Limited , 2019)9

As consumers in Southeast Asia are spending more than eight hours a day online on average, the modern consumer’s comfort with digital channels and content has shaped an intricate journey across online and offline touchpoints. But regardless of touchpoint, consumers expect a constant brand experience across all channels. (McKinsey & Company, 2018)10

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Retail Location & Space

Wisma Atria, a mall that is strategically placed along a major stretch of Orchard Road between ION Orchard and Ngee Ann City, appreciates a huge stretch of prime street facade and is a renowned landmark to both locals and tourists. Wisma Atria enjoys a high human traffic flow due to its Orchard Road front and an underground pedestrian linkway which connects Wisma to Orchard MRT and Ngee Ann City, allowing for ease of access.

Wisma Atria houses the flagship stores of famous international brands such as Coach, Emperor Watch & Jewellery, Mauboussin, Tory Burch and Tag Heuer. Its mid-to upscale placement has garnered fashion brands from the likes of Lacoste, Seafolly , Cotton On, and even home grown brands such as Charles & Keith and Pedro along with a wide range of beauty stores including the city’s biggest ETUDE HOUSE. During the 2nd quarter of FY18/19, the mall oversaw the launch of fresh faces, such as e-commerce fashion retailer Love & Bravery, international multilabel sneakers-apparel store AW LAB and international cutting-edge fashion eyewear brand MUJOSH LAB. During the years 2017 & 18, the mall managed to attract a customer traffic of nearly 23.5 million. Wisma Atria has also won many awards over the years for its stellar mall design and maintenance, shopping experience and tenant relations. (Starhill Global Reit, 2018)11

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Why Wisma Atria? As a new and emerging fashion player to the market, Order must capture an audience by developing an initial buzz or following. Choosing a strategic location is vital. With COS situated at ION and BLACKBARRETT at Paragon, placing Order at Wisma Atria will position itself right in the middle of its two competitors. This will enable Order to catch spill over customers in the vicinity.

Although ION Orchard was the preferred mall choice by respondents, they mainly shop around and work along the city and orchard road area. With Wisma being in such proximity and accessibility to ION, it should not be an issue. Furthermore, the benefits outweigh the cost of placing the store at ION. By situating the store in Wisma Atria, it can achieve a significantly larger floor area as compared to ION at a more affordable price. Order requires a larger space to house its components to give its customers an experiential retail experience. ION was offering $40.62 SGD Psft, while Wisma was offering $29k SGD for a 1700Sqft store space which would equate to $17.05 SGD Psft. With the assumption of a budget of $20k, Order could procure a shop space of 1100Sqft easily, which compared to ION would only yield 500Sqft.

(PropertyGuru Pte Ltd, 2019)12

Order will set up a private limited company with a retail store space of 1100Sqft within Wisma Atria as a private limited company is the most progressive, flexible, and scalable type of business in Singapore. It is also an efficient tax entity. The current corporate tax rate for Singapore companies for profits up to SGD 300,000 is below 9% and capped at 17% for profits above SGD 300,000. Furthermore, there is no capital gains tax. Singapore follows a single-tier tax rule which indicates that once income has been taxed on a corporate level, dividends will be tax free when distributed amongst shareholders. (Hawksford, 2019)13

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Retail Theatre Omni-channel retailing is about providing consistent, unique and contextual brand experiences across multiple customer touchpoints, including brick and mortar, web, mobile and social. To achieve this requires a simple philosophy.

Order’s philosophy for a customer’s journey is simple: A customer visits the retail store and either makes a purchase from a staff holding an Ipad or leaves the store empty handed. Later, recalls an item they wanted but did not buy, uses smartphone to visit Order’s Facebook/Instagram page, gets directed to the website directly through sponsored ads or shoppable tags where purchases are encouraged via social only discounts. They click purchase and pick up the item in store the following day or have it delivered to their home. This philosophy enables Order to engage the customer on multiple touchpointsfrom the physical store, social media platforms, e-commerce site and mobile commerce all together. To enable consistency throughout these platforms, Order will engage Shopify’s services. Namely its POS system, which puts the store in the palm of your hands. Shopify POS is an application for iOS and Android devices that can be used for transactions in a physical store. Manage products, process orders, take payment, swipe credit cards, produce receipts, generate retail reports and control it all from an iPad or mobile device. It is all an in one system which is vital as information is synchronized across the board, allowing Order to track customers preferences and tailor personalized services and ads. (

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Shoppable Tags

By 2021, 53.9% of all retail e-commerce is expected to be generated via mobile

phones. –Statista

Thus, Instagram’s shoppable posts are the next big thing for businesses. Its content delivers a unified experience to both customers and retailers. Customers can click

on a post and immediately see the name and price of the product; if they then click on a tag, they will be brought to a detailed page – with more product details,

similar items and other shoppable posts from the brand. Then, if the consumer taps the ‘Shop Now’ link from the product details view, they’ll go directly to that

product on the website. Aside from shoppable posts, Instagram stories enables Order to engage with its users, humanize the brand, create leads, and generate

customers on the platform. It is a great tool for showing potential customers why the brand is significant or exciting. (Fleming, 2018)15

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Stock Allocation - Costing Planned Purchases = Planned EOM Stock + Planned Sales + Planned Reductions – Planned BOM Stocks. Pre-operation:

January: $40,000 worth of goods (planned EOM stock) + $13,250 (for Jan sales) + $1,320 (planned reductions which is 10% of cogs accounting for staff discount and promotional discounts) - $67250 (stock before operation) = -$12,680 Feb: $35,000 worth of goods + $13,250 Feb sales +$1320 (planned reductions) $4,000 ($67250-jan sales $13250) = - $4430

March: $25,000 worth of goods + $11,000 March sales + $1100 (planned reductions 10% of cogs) - $40,750 (opening stock $67250- jan-feb sales) = -$3650

April: $20,000 + $8250 +$825-$$29750 = - $675

May: $10,000+$8250+$825-$21500= -$2425

June: $5000+$13250+$1320-$13250= $6320

In June, another $62750 (6 mths worth of inventory will be purchased after purchasing 6 months worth of goods 1 month before Jan). July: $5,000+$11000+$1100-$62750= -$45,650 August: $3,000+$8250+825-$51750=-$39,675

September: $3000+$8250+$825-$43500=-$31425

October: $3000+$11000+$1100-$32500=-$17400

November: $3000+$11000+$1100-$21500=-$6400

December: $3000+$13250+$1325-$10,500=$7075

Hence there is an additional purchase of $6320 for June and $7075 required for December. No extra purchases needed for the other ten months.

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Stock Allocation In-Store As a new brand, it is not possible to estimate the right amount of sizes allocated to each piece of garment for sale in store. Therefore, a rough guide in the assortment plan below will be used as a standard for the business in the first year. After which, it will be possible to track customers buying patterns and draft a new assortment plan for the following year using retail data analytics and sales patterns. Matching supply and demand in the future.

The ratio of tops to bottoms and outers are derived from forecasted sales figures and are subject to modifications in the future.

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Marketing Plan After launching a brand and having a retail presence, marketing and promotion is one of the necessities for getting a brand in front of the public and attracting new customers. It is an important aspect regarding generating of sales and awareness for a new fashion label. Upon the launch of the Order store, a product party would be held at the store itself. Prior to the party, invites are to be sent to various people in the industry, potential customers and celebrities. Have products on display at the party so that interested customers can buy easily.

Conventional advertising is generally costly and not a definite way of generating sales. For this, advertising for Order would only consist of utilizing influencers. Basically, send out clothing to fashion influencers to wear and do a review about it on their social media page with details of the brand and where to buy it. Because of how good the clothes usually look on the influencers and that people believe that these influencers are the encyclopedias of fashion, sales and brand awareness usually follow suit.

As per primary research survey Q3, a total of 63.4% of respondents indicate their favourite hobbies are music and sports. Order will allow customers to share what music they are listening to on Spotify to social media sites to enter contests which could result in prizes. For the sports aspect, with the upcoming 2022 world cup, it is a huge opportunity to engage with customers through various Instagram stories, trivia games and even live streaming in the store itself with full on decorations, creating experiential retail environments. 33


Conclusion & Recommendations Launching a new fashion brand doesn’t come without risks. But with a well analysed report, we can mitigate those risks. Increase its chances of success in this volatile retail market.

With an expanding menswear market and a consumer preference for omni-channel retailers, Order might just launch itself into the warm and receiving hands of consumers. Based solely on financial statements and forecasts alone, Order looks to be a profitable fashion business in the long run. For Order to truly succeed, it must take steps to ensure customer satisfaction. Keep up with the trends, observing the ever changing behaviors of customers and cater to their needs. Feedback and criticism plays a huge role as well. Order must keep up with the supply and demands in the market of consumerism. Competition is stiff, and Order has to stand out. The information in this report is tentative to the current launch only, and is subject to changes from marketing to retail strategies. Even price points can change with time. Nothing is for certain. As long as Order maintains a strong oversight into market and industry trends, it can always be the first to strike before its competitors.

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Bibliography 1. Imran Amed, J. A. (2017, November). The State of Fashion 2018: Renewed optimism for the fashion industry. Retrieved from https://www.mckinsey.com/industries/retail/ourinsights/renewed-optimism-for-the-fashion-industry 2. Smith, K. (2016, June 16). Spring 2017 Menswear: Market growth & trends. Retrieved from https://edited.com/blog/2016/06/menswears-magic-moment

3. Statista. (2019, March). Apparel - Singapore | Statista Market Forecast. Retrieved from https://www.statista.com/outlook/244/124/fashion/singapore 4. Mintel Press Team. (2018, June 8). Dressed For Success: MINTEL UNVEILS 10 MENSWEAR FASHION FACTS. Retrieved from https://www.mintel.com/presscentre/fashion/dressed-for-success-mintel-unveils-10-menswear-fashion-facts-forlondon-fashion-week-mens 5. Euromonitor. (2019, March). Menswear in Singapore. Retrieved from https://www.euromonitor.com/menswear-in-singapore/report 6. BLACKBARRETT by Neil Barrett. (n.d.). Retrieved from http://www.blackbarrett.com/#!/home

7. COS. (n.d.). Retrieved from https://www.cosstores.com/en_gbp/men.html

8. Bryden Pte Ltd. (2019). Services. Retrieved from https://brydenapparel.com/services/

9. Hawksford Group Services Limited . (2019). The shifting trend of retail in Singapore. Retrieved from https://www.guidemesingapore.com/business-guides/industryguides/retail-industry/the-shifting-trend-of-retail-in-singapore 10. McKinsey & Company. (2018, November). The State of Fashion 2019: A year of awakening. Retrieved from https://www.mckinsey.com/industries/retail/ourinsights/the-state-of-fashion-2019-a-year-of-awakening

11. Starhill Global Reit. (2018, December 31). Wisma Atria Property. Retrieved from http://www.starhillglobalreit.com/wisma-atria.html

35


12. PropertyGuru Pte Ltd. (2019, March 9). For Rent- Wisma Atria. Retrieved from https://www.commercialguru.com.sg/listing/21449032/for-rent-wisma-atria 13. Hawksford. (2019). Types of Business Entities in Singapore. Retrieved from https://www.guidemesingapore.com/business-guides/incorporation/introduction-toincorporation/types-of-business-entities-in-singapore#Private-Limited-Company

14. Anon, POS System - Point of Sale for Retail Stores. Shopify. Available at: https://www.shopify.com.sg/pos

15. Fleming, M. (2018, March 20). Instagram launches shoppable posts as it looks to play a bigger role in ecommerce. Retrieved from https://www.marketingweek.com/2018/03/20/instagram-launches-shoppable-postslooks-play-bigger-role-ecommerce/

36


Appendix 1 Internal Survey Conducted

37


38


Sports and music dominate over 60% of the chosen hobbies, with 70% taking inspiration for purchases from social media platforms, of which are inspired by a celebrity.

Sport celebrities/athletes or musicians can be used to endorse clothing as a form of advertising. From promotions that tie with sporting and music labels, to an instore experience featuring apps such as Spotify.

A majority 73% of consumers purchase clothing twice every 3 months. New collection should arrive in stores every 3 months with promotions running every 3 months to clear old inventory. This keeps in line with their shopping habits. 39


Most respondents shop with a partner or a friend and purchases are usually planned. On weekends, public holidays, sales are expected to increase as that’s when couples go on a date and shop together. Thus a need to stock up more than usual on these days, include more promotional campaign such as valentines day gifting and encourage multiple purchases with discounts. 40


Create shoppable content on social media platforms with targeted ads. Social only discounts for friends who purchase multiple items. Provide status updates about new drops, connecting the customer to the brand.

Quality and style are the top-rated components of a garment. With comfort coming in at 3rd place.

This keeps in line with Order’s brand philosophy of ‘’For those who discuss design and quality before price’’. 41


Sleek and minimalist & casual and sporty creates a mix that adheres to our brand philosophy of ‘’Not overworking designs, taking a minimalist approach’’ and ‘’A menswear brand whose products are design driven, modern and functional’’

Order’s price range are as follow: Shirts: $78-$148

Bottoms: $88-$148

T-shirts: $48-$78

Jackets: $128-$258

42


This keeps in line with what respondents in this segment are willing to pay which serves as a good estimate.

Respondents preference for mix of online and retail enables us to give them the best of both worlds: An Omni channel brand with experiential storefront. Brick & mortar, E-commerce and social media will be combined to form one seamless experience. 43


60% of respondents prefer ion orchard as their shopping destination. Thus a switch of store location will be considered. This is to ensure that we capture our target audience.

Based on a scale of 1-10, being 10 strongly agreeing, most respondents in the target market are open to new brands without a need to follow trends, this highlights that the target customer is individualistic. This also keeps in line with Order’s ‘’beyond seasons’’ motto. 44


As today consumers do all their prep online—reading reviews, exploring alternatives on social media, finding the best discount—which means less time spent going around stores and lesser unplanned purchases.

A brand has a week to capture the attention of the consumer before he changes his mind.

45


Appendix 2 Costing Sheet

Style Number: ODS 002 Description: Striped Smart Shorts Fabrics: Striped Cotton Sateen Size Range: 28 - 34

Materials

Yardage

Price/Meter

Total amount

Fabric Body

1m

12

12

Linings

0.25m

2

0.5 Total Amount = $12.50

Trims

Amount

Cost Each

Total amount

Button

1

0.50

0.50

Zippers

1

0.50

0.50

Others

-

-

Total Amount= $1

Cutting & Sewing

$8.50

Grading & Marking

$2 Total Amount= $10.50

Total cost of garment: $24 Suggested retail price: $98 (With 300% Mark-up & adjusted Pricing)

46


Costing Sheet

Style Number: ODS 003 Description: Long Sleeved Shirt With Extended Hem & Seam Details Fabrics: Embossed Cotton Poplin Size Range: XS, S, M, L

Materials

Yardage

Price/Meter

Total amount

Fabric Body

1.5m

12

18

Linings

0.25

2

0.5 Total Amount = $18.5

Trims

Amount

Cost Each

Total amount

Button

10

0.25

2.50

Zippers

-

-

-

Others

-

-

Total Amount= $2.50

Cutting & Sewing

$8.50

Grading & Marking

$2 Total Amount= $10.50

Total cost of garment: $31.50 Suggested retail price: $128 (With 300% Mark-up & adjusted Pricing)

47


Costing Sheet

Style Number: ODS 004 Description: Drawstring Pants With Elastic Waistband and Cuffs Fabrics: Italian Cotton/Polyester Blend Size Range: 28 - 34

Materials

Yardage

Price/Meter

Total amount

Fabric Body

1.5m

12

18

Linings

0.50

2

1 Total Amount = $19

Trims

Amount

Cost Each

Total amount

Button

-

-

-

Zippers

-

-

-

Others

Elastic Bands

3

3 Total Amount= $3

Cutting & Sewing

$8.50

Grading & Marking

$2 Total Amount= $10.50

Total cost of garment: $22 Suggested retail price: $88 (300% Mark-up)

48


Costing Sheet

Style Number: ODS 010 Description: Bomber Jacket with Circular Patch Design Fabrics: Cotton Polyester Blend, Ribbing Size Range: XS, S, M, L

Materials

Yardage

Price/Meter

Total amount

Fabric Body

1.5m

12

18

Lining + Rib

1

3

3 Total Amount = $21

Trims

Amount

Cost Each

Total amount

Button

-

-

-

Zippers

1

1

1

Others

Elastic Bands

3

3 Total Amount= $4

Cutting & Sewing

$9

Grading & Marking

$3 Total Amount= $12

Total cost of garment: $37 Suggested retail price: $148 (With 300% Mark-up & adjusted Pricing)

49


Appendix 3: Financial Statements Start-up Expenses

Items

Initial Deposit- 0 Leasehold Improvements-

15,000

Rent for Mo. of Improvements- 60,000 Inventory Analyst fee- 1,800 Professional FeesInsurance-

0

1008

General Startup Costs- 10,800 Marketing: Packaging, PR, Design

11,880 100488

Total Start-up Expenses

Start-up Assets Cash Required 7,500 Start-up Inventory

67,250

Other Current Assets

0

Long-term Assets

15,000

Total Start-Up Assets

89,750

Total Start-up Funds Required: $190,238

The company will require 6 months worth of inventory as start up inventory. Based on Sales Forecast, from January to June, the cost of goods required is $67,250 in total. A basic renovation to the aesthetics of the retail store is estimated to cost $15k. Start up cash required would be about $7,500. Hence the total start-up funds, based on the figure above shows to be $190,238 Long term assets are estimated to be worth $15,000, including furnitures, equipments and patents Prior to business opening, we will be engaging in marketing campaigns and activities which include public relations, packaging and designing of apparels that are estimated to cost about $11,880 As deposit of 3 months worth of rental deposit must be made prior to business opening, the rental deposit is calculated at $20k per month, in total of 3 months = $60k.

50


Sources of Funds Owner Injection of Capital Investor's Fund Loan Required Total Start-Up Fund:

53,888 86,350 50,000 190,238

51


52

Sales Forecast ($) Total Sales Less: Cost of Goods Sold Net Sales Profit 13,250 39,750

13,250 39,750

11,000 33,000

44,000

Mar 8,250 24,750

33,000

Apr 8,250 24,750

33,000

May 13,250 39,750

53,000

Jun

Jul

11,000 33,000

44,000 8,250 24,750

33,000

Aug 8,250 24,750

33,000

Sep 11,000 33,000

44,000

Oct 11,000 33,000

44,000

Nov

Net sales profit is noted to be $390,000 in year 1, $468,000 in yr 2 and $561,600 in the 3rd year.

The above sales forecast shows that 1/4 of net sales is estimated to be the cost of goods sold. Daily week sales are forecast to be $1480, on weekends expected to increase 20% in sales to $1776. High sales volume months are recorded on Janurary, February, June and Decemeber. Low sales volume months are recorded on April, May, August and September while average sales volume months are recorded in March, July, October and November. On peak months, sales revenue are expected to increase by 20% at $53,000 compared to average sales revenue at $44,000 and low sales revenue are expected to decrease 20% of average sales revenue per month at $33,000.

53,000

Feb

53,000

Jan

Sales Forecast

13,250 130,000 39,750 390,000

Year 1

53,000 520,000

Dec

156,000 468,000

Year2

624,000

187,200 561,600

Year 3

748,800


53

Assuming that the variable cost is 20% of the total sales revenue, given from monthly income that the observed fixed cost per month is calculated to be $23,082. It is noted that if you cross reference to the variable cost per month found in the monthly income, which should be about $2238, there is a huge difference to the estimated variable cost found in this break even analysis section. It can only be justified that the fixed cost is used as a reasonable basis instead of the variable cost found in the monthly income statement only because fixed costs are quanitifiable whereas variable costs depends on the amount of goods or services used or purchased each month. Therefore, the amount of revenue needed per month on average to break even is calculated to be about $28,853.

$0

20% $23,082 Rent, insurance, payment on loan, depreciation, equipment lease, management salaries $5,771 80% means every $1 earns, 80 cents contribuite to pay the fixed cost

Assumptions: Average Percent Variable Cost Estimated Monthly Fixed Cost Estimated Monthly Variable Cost Variable Contribution Margin

Net Profit

$28,853

Monthly Revenue Break-even

Break-even Analysis


54

39,750 0.75

5,400 40 250 15,000 400 75 1,500 417 1,300 200 80 100 558 200 25,520 14,230 833 13,397 2,277 11,119

Less Operating Expenses: Salaries & Wages Bank Service Charges Depreciation (5 years) Rent (1st yr @ 9mths ) E-Commerce Fees Employee Benefits Professional Fees- Accounting Interest Expense- Loan (10% loan over 5 yrs) Advertising & Promotion (3% net sales) Utilities Telecommunication Maintenance -Store Amortization - Start up costs License & Permits Total Operating Expenses

Pofit before Interest Tax Interest Expense Income before Tax Payable Income Taxes (17%) Net Earnings 15,930 833 15,097 2,566 12,530

5,400 40 250 15,000 400 75 0 417 1,300 200 80 100 558 0 23,820

39,750 0.75

9,180 833 8,347 1,419 6,928

5,400 40 250 15,000 400 75 0 417 1,300 200 80 100 558 0 23,820

33,000 0.75

930 833 97 16 80

5,400 40 250 15,000 400 75 0 417 1,300 200 80 100 558 0 23,820

24,750 0.75

930 833 97 16 80

5,400 40 250 15,000 400 75 0 417 1,300 200 80 100 558 0 23,820

24,750 0.75

15,930 833 15,097 2,566 12,530

5,400 40 250 15,000 400 75 0 417 1,300 200 80 100 558 0 23,820

39,750 0.75

9,180 833 8,347 1,419 6,928

5,400 40 250 15,000 400 75 0 417 1,300 200 80 100 558 0 23,820

33,000 0.75

930 833 97 16 80

5,400 40 250 15,000 400 75 0 417 1,300 200 80 100 558 0 23,820

24,750 0.75

930 833 97 16 80

5,400 40 250 15,000 400 75 0 417 1,300 200 80 100 558 0 23,820

24,750 0.75

9,180 833 8,347 1,419 6,928

5,400 40 250 15,000 400 75 0 417 1,300 200 80 100 558 0 23,820

33,000 0.75

9,180 833 8,347 1,419 6,928

5,400 40 250 15,000 400 75 0 417 1,300 200 80 100 558 0 23,820

33,000 0.75

15,930 102,461 833 10,000 15,097 92,461 2,566 15,718 12,530 76,743

5,400 64,800 40 480 250 3,000 15,000 180,000 400 4,800 75 900 0 1,500 417 5,000 1,300 15,600 200 2,400 80 960 100 1,200 558 6,699 0 200 23,820 287,539

39,750 390,000 0.75 0.75

Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Yrly Ttl 53,000 53,000 44,000 33,000 33,000 53,000 44,000 33,000 33,000 44,000 44,000 53,000 520,000 13250 13250 11000 8250 8250 13250 11000 8250 8250 11000 11000 13250 130000 0 0 0 0 0 0 0 0 0 0 0 0 0 13,250 13,250 11,000 8,250 8,250 13,250 11,000 8,250 8,250 11,000 11,000 13,250 130,000

Gross Margin Gross Margin %

Sales Direct Cost of Sales Other Costs of Goods Total Cost of Sales

Jan Month 1

Monthly Pro Forma Profit and Loss

ORDER.CO

23,082 Total Fc per mth 2,238 Total VC per mth


55

156000 468000 75%

130,000 390,000 75%

64,800 480 3,000 180,000 4,800 900 1,500 5,000 15,600 2,400 960 1,200 6,699 200 287,539 102,461 10,000 92,461 15,718 76,743

Less Operating Expenses: Salaries & Wages Bank Service Charges Depreciation (5 years) Rent (1st yr @ 9mths ) E-Commerce Fees Employee Benefits Professional Fees- Accounting Interest Expense- Loan (10% loan over 5 yrs) Advertising & Promotion (3% net sales) Utilities Telecommunication Maintenance -Store Amortization - Start up costs License & Permits Total Operating Expenses

Pofit before Interest Tax Interest Expense Income before Tax Payable Income Taxes (17%) Net Earnings

207,397 10,000 197,397 33,557 163,840

64,800 480 3,000 240,000 4,800 900 1,500 5,000 22,464 2,400 960 1,200 6,699 0 354,203

187200 561600 75%

748800

Employee Benefits : Annual group term insurance $900 Amortization: Expenses incurred in preparing to open a new business are deducted over 180 months, rather than all at once as they would be if the business were already operating. https://www.bizfilings.com/toolkit/re

117,541 10,000 107,541 18,282 89,259

64,800 480 3,000 240,000 4,800 900 1,500 5,000 18,720 2,400 960 1,200 6,699 0 350,459

624000

520,000

Total Revenue Less Cost of Goods Sold Gross Profit Gross Profit Margin


$26,500 $53,000 $53,000

$0 $26,500 $60,500

$0 $0 $0 $0 $0 $0 $0 $60,500

Additional Cash Received Sales Tax, VAT, HST/GST New Current Borrowing New Other Liabilities (interest-free) New Long-term Liabilities Sales of Other Current Assets Sales of Long-term Assets New Investment Received Subtotal Cash Received

$0 $0 $0 $833 $0 $0 $0 $24,544

Additional Cash Spent Sales Tax, VAT, HST/GST Paid Principal Repayment of Current Other Liabilities Principal Long-term Liabilities Principal Purchase Other Current Assets Purchase Long-term Assets Dividends Subtotal Cash Spent $1,956 $1,956

$5,400 $18,311 $23,711

Expenditures from Operations Cash Spending Bill Payments Subtotal Spent on Operations

Net Cash Flow Cash Balance

Month 1

Expenditures

$28,456 $30,412

$0 $0 $0 $833 $0 $0 $0 $24,544

$5,400 $18,311 $23,711

Month 2

$0 $0 $0 $0 $0 $0 $0 $53,000

$26,500

$26,500

0.00%

Month 2

Month 1 $7,500

Feb

Jan

Cash from Operations Cash Sales Receipts from Credit card Sale Subtotal Cash from Operations Cash From Sales

Cash Received

56 $23,956 $54,368

$0 $0 $0 $833 $0 $0 $0 $24,544

$5,400 $18,311 $23,711

Month 3

$0 $0 $0 $0 $0 $0 $0 $44,000

$48,500 $44,000

$26,500

$22,000

Month 3

Mar

ORDER.CO

$13,956 $68,324

$0 $0 $0 $833 $0 $0 $0 $24,544

$5,400 $18,311 $23,711

Month 4

$0 $0 $0 $0 $0 $0 $0 $33,000

$38,500 $33,000

$22,000

$16,500

Month 4

Apr

Jul

Aug

Sep

Oct Month 10

Nov Month 11

Dec Total Month 12

Month

Month

Month

$8,456 $76,780

$18,456 $23,956 $13,956 $8,456 $13,956 $19,456 $23,956 $95,236 $119,192 $133,148 $141,604 $155,560 $175,016 $198,972

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $833 $833 $833 $833 $833 $833 $833 $833 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,000 $24,544 $24,544 $24,544 $24,544 $24,544 $24,544 $24,544 $24,544

$5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $18,311 $18,311 $18,311 $18,311 $18,311 $18,311 $18,311 $18,311 $23,711 $23,711 $23,711 $23,711 $23,711 $23,711 $23,711 $23,711

Month 5 Month 6 Month 7 Month 8 Month 9

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $33,000 $53,000 $44,000 $33,000 $33,000 $44,000 $44,000 $53,000

$1,000 $294,528

$9,996

$64,800 $219,732 $284,532

$520,000

$33,000 $43,000 $48,500 $38,500 $33,000 $38,500 $44,000 $48,500 $493,500 $33,000 $53,000 $44,000 $33,000 $33,000 $44,000 $44,000 $53,000 $520,000

$16,500 $16,500 $26,500 $22,000 $16,500 $16,500 $22,000 $22,000 $233,500

$16,500 $26,500 $22,000 $16,500 $16,500 $22,000 $22,000 $26,500 #######

Month 6 Month 7 Month 8 Month 9

Jun

Year 1

Month 5

May

Montly Cash Flow Statement for Year 1

10,000$ loan over 5 years

Staffs income


Yearly Cash Flow Cash Received Cash from Operations Cash Sales Receipts from Credit card Sale Subtotal Cash from Operations Additional Cash Received Sales Tax, VAT, HST/GST Received New Current Borrowing New Other Liabilities (interestfree) New Longterm Liabilities Sales of Other Current Assets Sales of Long-term Assets New Investment Received Subtotal Cash Received Expenditures

Year 1 7500

Year 2

Year 3

$260,000 $233,500

$624,000

$748,800

$501,000

$624,000

$748,800

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$501,000

$624,000

$748,800

Year 1

Year 2

Year 3

57


Expenditures from Operations Cash Spending Bill Payments Subtotal Spent on Operations Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out Principal Repayment of Current Borrowing Other Liabilities Principal Repayment Long-term Liabilities Principal Repayment Purchase Other Current Assets Purchase Long-term Assets Dividends Subtotal Cash Spent Net Cash Flow Cash Balance

$64,800

$64,800

$64,800

$219,732

$219,732

$219,732

$284,532

$284,532

$284,532

$0

$0

$0

$0

$0

$0

$0

$0

$0

$10,000

$10,000

$10,000

$0

$0

$0

$0

$0

$0

$1,000 $295,532

$1,000 $295,532

$1,000 $295,532

$205,468

$328,468

$453,268

$205,468

$533,936

$987,204

58


Assets Current Assets Cash Inventory Other Current Assets Total Current Assets Long-term Assets Long-term Assets Accumulat ed Depreciati on Total Longterm Assets Total Assets

Starting Balances

Current Borrowing Other Current Liabilities Subtotal Current Liabilities Long-term Liabilities Total Liabilities Paid-in Capital Retained Earnings Earnings Total Capital Total Liabilities and Capital Net Worth

Monthly Balance Sheet for Yr 1 March April May

Feb

June

Juky

Aug

Sep

Oct

Nov

Dec

$7,500 $15,900

$24,544

$24,544

$24,544

$24,544

$24,544

$24,544

$24,544

$24,544

$24,544

$24,544

$24,544

$24,544

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$23,400

$40,444

$27,194

$29,544

$41,494

$56,194

$63,544

$70,494

$77,844

$85,194

$89,794

$94,394

$98,994

$15,000

$15,000

$15,000

$15,000

$15,000

$15,000

$15,000

$15,000

$15,000

$15,000

$15,000

$15,000

$15,000

$0

$250

$500

$750

$1,000

$1,250

$1,500

$1,750

$2,000

$2,250

$2,500

$2,750

$3,000

$15,000

$15,250

$15,500

$15,750

$16,000

$16,250

$16,500

$16,750

$17,000

$17,250

$17,500

$17,750

$18,000

$38,400

$55,694

$42,694

$45,294

$57,494

$72,444

$80,044

$87,244

$94,844

$102,444

$107,294

$112,144

$116,994

Liabilities and Capital Current Liabilities Accounts Payable

Jan

$15,900

Month 1

$2,650

Month 2

$5,000

Month 3

$16,950

Month 4

$31,650

Month 5

$39,000

Month 6

$45,950

Month 7

$53,300

Month 8

$60,650

Month 9

$65,250

$69,850

$74,450

Month 10 Month 11 Month 12

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$5,535

$12,098

$11,717

$29,504

$27,619

$42,826

$10,660

$24,037

$33,536

$33,576

$33,667

$33,904

$50,000

$49,523

$49,051

$48,583

$48,119

$47,660

$47,205

$46,755

$46,309

$45,867

$45,430

$44,996

$44,567

$50,000

$55,058

$61,149

$60,300

$77,623

$75,279

$90,031

$57,415

$70,346

$79,403

$79,006

$78,663

$78,471

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$636 ($18,455)

($15,006)

($20,129)

($2,835)

($9,987)

$29,829

$24,498

$23,041

$28,288

$33,481

$38,523

$42,694

$45,294

$57,494

$72,444

$80,044

$87,244

$94,844

$102,444

$107,294

$112,144

$116,994

$636 ($18,455)

($15,006)

($20,129)

($2,835)

($9,987)

$29,829

$24,498

$23,041

$28,288

$33,481

$38,523

($11,600) $38,400

($11,600)

$55,694

Opening Inventory for next month= ending inventory of 1 mth before + inventory purchase - cogs of current mth Inventory purchase using forecasted yearly cogs = $187,200 /12 mths =$15,600

59

Profile for Dan P Lim

Business Report For Order  

University Of East London, CW3.

Business Report For Order  

University Of East London, CW3.

Profile for danplim
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