Imagine a high-end, local, and innovative clothing boutique which specializes in comfortable and unique fashionable designs for babies and children:  High quality, gentle, and eco-friendly fabrics sourced through fair trade and organic means.  A business which will thrive in the Beverly Hills area, as well as expand online, to provide  incredible products to families, both regionally and internationally, and tapping into one of the largest growing fashion markets today. Can you see it? That’s Chéri.

The baby and children’s clothing market is growing globally, with the United States leading revenue generation with $8,348 million in 2018, due to a focus on more trendy, adult-approved fashions inspired by celebrities and social media influencers.  Modern childrens' wear shoppers like to express their own personal values in their purchases, including original designs, comfortable and durable products, as well as choosing eco-conscious and ethically-sourced materials. Luckily, Chéri’s competitive advantage includes all of these elements in their coveted products, which we believe allow the store to  emerge as a trend-setter in the already famous southern California shopping neighborhood.

To facilitate the start-up process, Chéri will require $750,000 to procure a storefront, business equipment, appropriate licenses, branding services, online/e-commerce platform, and inventory. Further, an estimated $16,800 - $18,300 are needed to cover operational costs each month for the first year, which will show a positive profit trend after the first six months of operation (expanded details in the financial section).

As a smaller, high-end boutique, Chéri will consist of two owners acting as President and Vice President, as well as three full-time employees to get off the ground. Chéri will have a friendly, neighborhood touch to serve its customers with a concierge style and a personal experience destination to both delight and increase customer loyalty. An e-commerce website will also be available to keep up with the online shopping market and make products available on a wider scale.

We believe investing in Chéri is a lucrative and profitable business venture. As our profits are projected to increase steadily in the first 12 months, the return on investment should prove to grow as time goes on. There will always be a need to clothe babies and children, and Chéri takes shopping for little ones to the next level. We have a commitment to stay relevant, trendy, environmentally and ethically conscious, and quick to adapt to future market shifts and changes. We are committed to providing our customers the best choice for their baby and childrens' wear needs and desires.

The baby/children’s clothing market is growing globally, with the United States leading revenue generation with $8,348 million in 2018. It’s considered a lucrative segment in the apparel industry, hitting a value of $173 billion in 2017, and projected to steadily grow in value and revenue, the latter rising 5.4% between 2019 - 2023. There will always be a need for children’s clothing, and fashion blended with function is vital for today's consumers.

While e-commerce is becoming more prevalent for shopping, there is one huge benefit to having a brick and mortar clothing store: confirming sizing. Children grow at different rates, and often rapidly; with variations in manufacturer measurements and sizes, being able to physically see an article of clothing creates easier sales and more satisfied customers. According to the Insight and Strategy Director at Cassandra (a youth-research firm), 78% of parents in the US prefer to shop in store over online, and 70% shop continuously throughout the year, as opposed to seasonally. Physical stores can also provide an experience destination for both parents and children, which can create stronger brand loyalty and return customers for the child's younger years.

Chéri will offer its customers a unique collection of infant and youth apparel. The products will be either locally produced or fair-trade sourced. The customers will benefit from the option to purchase simple, yet sophisticated, designs made of natural materials. Chéri will be a one-stop store for people looking for baby/toddler apparel while supporting local communities and an ethical supply-chain.

Fashion and fabrics are both important features of baby/children’s clothing, from a consumer point of view. Twenty years ago, fashion was more focused on children, while today, it strives to please both the parent and child. Trendy fashions mimicking adults is very popular amongst children’s clothing designs, as well as the “mini-me” approach, where both matching/coordinating parent and children outfits are available to buy as sets, or individual mix and match pieces. As far as fabrics go, cotton/organic cotton is an ever-popular choice as it is: durable, easy to wash, looks great after multiple washes, breathable, and soft enough for sensitive skin.

Chéri will work with local and emerging designers to provide its customers with a fresh and unique collection which will be hard to resist. In addition to comfort and style, environmentally and socially responsible practices are in the heart of Chéri. The store will host monthly story times and puppet shows for young kids, as well as sewing classes for older children, in an effort to educate their young clientele build a strong community among its shoppers.

DEMOGRAPHY

There two main demographic concerns. The actual product consumer of our merchandise are the babies, or so-called "Generation Alpha." However, our main target buyers are ages 25-45, who are millennials and younger generation X.

Chéri targets customers who are affluent people with a higher income ($100,000 - $300,000+), willing to spend more on children’s clothing in order to purchase the best for their little ones. They live in the Beverly Hills and greater southern California area and enjoy the prestige of shopping on Rodeo Drive, looking for the latest trends.  Millennials are highly aware of social and environmental issues and therefore care more about locally produced or fair-trade sourced merchandise. They also enjoy spending money on experiences, so the Mommy and Me trend could prove a positive motivator for those parents wanting to match and share style and aesthetics with their little ones wherever they go.

ECONOMIC ENVIRONMENT

Depending on the economic performance of the United States, growth rates would have a significant impact on Chéri due to its local market property. Inflation  and decrease in consumer spending could affect the business significantly, mainly because Chéri is a specialized boutique store. Another factor affecting the company's profitability is the continually changing exchange rates which would affect the prices of the imported fair-trade goods.

Sustaining focus on industry’s economic indicators like textile and clothing industry growth rate is crucial for marketing. Other factors such as cost of living and borrowing patterns could also shift consumer spending choices. By analyzing data from consumer behavior, we can estimate the future business development and anticipated market change, as well as dynamically adapt to changes in the clientele's desires.

NATURAL ENVIRONMENT

One of the indirect influences that can affect the children apparel business will be the natural environment that impacts the company’s production of raw materials like cotton and bamboo, and how they are sourced and harvested. Weather patterns and growing season success could affect cost and availability for these goods as well as the transportation on importing the items. Chéri strives to offer sustainable fabrics as well as paper products used in their clothing hang tags, shopping bags, and display signs. Environmental considerations include air and water pollution that go into manufacturing of these paper goods (if any) and the availability of post-recycled material to create these items.

Other considerations include as regulations in textile production due to these changes.

TECHNOLOGY

The thriving technological industry vastly influenced businesses all over the world, including the clothing industry. The latest technology is fast, lowering production and servicing cost in the services category and increased the manufacturing rate. Since our primary target audiences are millennials and generation X, which are very tech-savvy, it is especially crucial and relevant for the business to invest in technology. In store, Chéri will need point of sale equipment, such as Square which can also be used on mobile devices for events and pop-up sales outside of the store. Further, a full desktop and mobile website is necessary for customers to be able to shop online, as well as internal cloud service for owners employees to store, work on, and share documents, images, customer data, sales data, etc.

While there are many places to buy clothing for babies and children, we can be smart about how we take our boutique into the market:

• Focusing on durable, quality, and sustainable materials in our clothing.

• Offering unique and on-trend products which appeal to both parents and their children, tapping into the “mini-me” and “mommy and me” outfit pairings which are currently popular.

• Creating an in-store experience which provides a positive shopping experience.

• Having the benefits of a brick-and-mortar store: being able to see and try on products to determine quality and sizing, connecting with real people, offer and participate in community events to create customer relationships (see infographic)

• Be open to leveraging an online store via a website to also stay competitive in the e-commerce marketplace.

• Use social media to reach and connect with customers, as well as involving social media influencers, to stay relevant, strengthen the brand name, and advertise the store’s unique features.

• With the many "mini" fashion influencers on Instagram and fashionable celebrity babies/kids all over the internet, keeping up with these trends using technology will be very important for success.

SURVEY SUMMARY

From the 29 people surveyed, 100% completed the study. 58.6% percent of the interviewed people were ages 18-34, 35.5% were ages 35-50 years old, and 6.9% were ages 51-75. 82.8% of those had kids/grandkids. Over 50% of the surveyed people had kids/grandchildren under the age of 5, which is the target audience for the proposed clothing boutique. Over 75% of people shopped at least 3-4 times a year for children’s clothing with quality being the most critical factor when choosing merchandise among 51.7% of the surveyed. Other significant factors were durability, softness, and design. Solid colors were most appealing in children’s clothing with 62.2%. Locally produced and sourced children’s merchandise was important, very important, or extremely important to 44.8% of people, the materials used in children’s clothing were important, very important, or extremely important to 96.5%, while sustainable and fair-trade practice in the production of merchandise measured at 67.9% of people. On a single shopping visit 50% of people surveyed spent between 31-60 dollars, 17.9% spent 10-30 dollars, 17.9% spent 61-99, and 14.3% spent over 100 dollars. Most surveyed people shopped for children’s clothing in branded clothing stores like GAP, Zara, and Old Navy, representing 41.4%. 24.1% preferred to buy at department stores like Nordstrom, Macy’s, Bloomingdale’s. Discount stores like Walmart and Target were equally popular as children’s clothing chains like Gymboree and Crazy 8 with 10.8% each. Only 6.9% of surveyed preferred to shop in boutique stores. 3.6% of the interviewed people were not willing to pay for locally-sourced, fair-trade, or sustainable children’s clothing. An equal number of people at 42.9% each were willing to pay 10% or 30% more respectively, and 10.7% were willing to pay up to 60% more.

SURVEY ANALYSES

Based on the survey results we can determine that there is a reason to believe people are willing to pay more for quality children’s clothing. Chéri is targeting parents and grandparents, who are looking for higher quality natural materials in solid colors and simple patterns, which is also the proposed merchandise to be offered at the store. While most people interviewed preferred to shop in chains and department stores, they were also willing to pay more for locally produced and fair trade sourced clothing. This combined with the frequency of the store visits and the amount people have spent on a single visit shows promise that a boutique store featuring infant and young children clothing from local designers and fair trade producers would be a successful enterprise. Into consideration has to be also taken the facts that we do not have data on the income of the interviewed people as well as the location of the in-person interviews, which were not performed in a high-end boutique neighborhood as the proposed location of Chéri. Therefore we can assume that a children boutique store in an affluent area like Beverly Hills will be desirable and successful among the shoppers who frequent the shopping area.

Strengths

1. High-quality fabrics and materials
2. Unique fresh and fun print designs
3. Local designers clothing and accessories
4. Fair-trade sourced merchandise
5. Community building events at the store
6. Sustainable practices in gift packaging and reusable bags with every purchase
7. Fully functional web store with shipping across North America
8. Active social media presence

WeAkneSses

1. The relatively small product range can turn off some customersLimited advertisement coverage
2. Higher prices due to sustainable practices and location
3. Niche market focused on baby/toddler clothes ages 0-5
4. Limited flexibility in pricing

Opportunities

1. Raise awareness of the store by advertising and community presence
2. Increase product range to offer apparel  for older kids, as well as new brands
3. Hiring a fashion designer to develop own brand might increase interest in the store
4. Offer same-day local delivery with online purchases
5. Expand online sales to Europe and the rest of the world
6. Adding additional stores in other affluent shopping neighborhoods
7. Offering personalized styling sessions for customers
8. Daily style look suggestions on social media

Threats

1. An economic downturn can affect sales negatively
2. Potential competition from other boutique and department stores in the area, which might start offering more local and sustainable brands
3. The increasing trend globally for online shopping through major brands can affect sales
4. Not enough participation in story time and other community events in the store
5. Inability to build loyalty among customers

Short-term Goals

1. Offer entirely reusable or compostable gift-packaging to promote and celebrate the grand opening, October 1, 2020
2. Maintain a strong social media presence on Facebook, Instagram, and Pinterest in an effort to gain followers, which would become potential customers. Full social media presence to be ready on the opening day, as a temporary business information source before the official website is live. September 1, 2020
3. Host ‘meet our designers” events every three months to promote new lines of apparel/seasonal offerings, starting Black Friday weekend 2020 to generate interest before the Holiday season. November 29, 2020.
4. Organize monthly story time for kids and social gathering for parents/grandparents to create promote public relation on the fourth Saturday of every month. December 21, 2020.
5. Offer international shipping to gain more customers for our web store from abroad. June 1, 2021.
6. Connect with nearby local hotels and businesses to promote Chéri to visiting tourists in order to expand the business internationally and establish connections for potential referrals. June 1, 2021. 

Long-term Goals

1. Maintain consistent store representation by further developing our image as a pioneer in sustainable, locally and fair-trade sourced materials and designer apparel with collections changing seasonally. Hosting three collection release events annually with partnership associations include WFTO (World Fair Trade Organization), NRDC (Natural Resources Defense Council) and California Fashion Association. WFTO: First Saturday of January. NRDC: First Saturday of April. California Fashion Association: First Saturday of July.
2. Expand product line to include apparel for older kids (ages 6-14) to generate more store traffic and web store business among parents with older children as well as keep existing customers whose children are growing.  January 1, 2023
3. Develop own design label to construct our brand image with elements of our unique selling point characteristics by hiring a local fashion designer with fist collection to be released for the summer of 2022. Deadline for delivery March 1, 2023.
4. Open two additional stores in the West Coast and one on East Coast (San Francisco, Seattle, and New York) located in affluent neighborhoods to gain potential audiences located in other cities with similar attributes as Beverly Hills/Los Angeles. Dates: San Francisco- October 1, 2022. Seattle- May 1, 2023. New York- Sep 1, 2024.
5. Offer franchise option to interested parties to expand operations selling sustainable, ethical apparel to expand Chéri’s leadership in the conscious enterprise community starting January 1, 2025.

MARKETING SEGMENTATION

Demographic:

• Age: 25 - 45; Millennials, younger Gen X
• Gender: Primary Female
• Family size or family life cycle stage: Parents or soon to be parents

Geographic :

• United States
• Los Angeles
• Beverly Hills
• Diversity: 47.9% Hispanic or Latino, 27.5% White, 13.7% Asian/Pacific Islander, 8.1% African-American, 2.8% Indian
• Climate 75° / 58° year round
• 4M in population in Los Angeles

Income:

• $100,000-$300,00 (or higher)

Social Status:

• Middle-Upper class
• Level of education:
• College degree or higher

Psychographic:

• Personality/Social Status:
  
  Parent’s desire for visual and style appeal of clothing colors and designs - on-trend and mimics adult fashions, showing they can afford a higher-end product.
  
  
• Values, Interests, and Opinions:
  
  Parents want to express their values, as related to their purchase choice of their children’s clothing. They prefer to choose items which are fair-trade sourced and are sustainable, as well as supporting local fashion designers and obtaining a unique product.
  
  
• Benefit Oriented:
  
  Consumers are looking for good looking, durable, and lasting materials in the clothing, which will hold up as the child grows and plays. They know that a higher priced product will result in a high-quality item, which will be worth the purchase.
  
  

PLACE

Chéri will have a traditional brick and mortar store located on Rodeo Drive in Beverly Hills, California. In addition to selling merchandise in the store, Chéri will be offering a fully functional web store, where customers will be able to purchase all available in the inventory items. Free shipping over $75 will be offered across the nation. Chéri will also develop a local delivery option for customers looking for a more personal approach to gifting. Shipping to other countries will be implemented as the business succeeds. Local pop-up displays and sales can be offered at local event and festivals.

PRICE

Chéri is positioning itself as a leader in locally sourced and sustainable fair-trade baby/toddler merchandise. It is the first store on Rodeo Drive to exclusive offer products of this type. Considering our high fixed costs for rent, insurance, and employee salaries, as well as many variable costs, which will depend on the inventory and transportation, Chéri will use cost-based pricing as a starting point. The store will offer “more for the same” proposition. By shopping at Chéri, the customers will not only obtain fashionable, comfortable, and natural products for their children, they will also support local designers and emerging communities. That is an added value in comparison to the competitors in the area. In the early stages of the store, Chéri will aim to implement break-even pricing. As the store builds a more extensive customer base, it will seek to sustain and increase profitability using different pricing strategies. The store will use time pricing by offering occasional discounts and promotions to bring more customers. These events can be combined with the scheduled community gathering at the store, like storytime and “meet our designers” parties. As new stores open and Chéri expands to other markets and locations, the company might use location pricing to adjust to the demand in different geographical areas. Promotional pricing will be offered seasonally to clear accumulated inventory and increase sales.

PROMOTION

• Focus on the first impression of the social media pages: Having a professional logo, sharing images that represent and speak for the brand.
• Team Members and Responsibilities: Establish each team member and define clearly what their responsibilities are. Appoint a brand ambassador, social content manager, research analyst.
• Set Goals: Establish goals we would like to accomplish with our Instagram account and define responsibilities per each team member
• Research and Establish Competitors, Audience and Influencers: Research who potential competitors are and what they are and are not doing well. Establish who our audience is and who we want to market to directly. Define who our potential Influencers are and how they can directly affect the brand voice.
• Create a Social Calendar: Create a calendar of events that will according to trending topics based on research.
• Increase brand awareness by running 3-4 ads a week
• Measure Analytics: Use Instagram analytics and followers likes and responses to gag what is doing performing or not performing.
• Post content (2-3 post daily on Instagram & Facebook) It's important to stay relevant on social media. Posting at least 3 a day keeps the brand relevant. One post in the morning brand related, second post mid day around 2 pm showcasing a specific product and the last post of the day in the evening around the time people are active online.

DIRECT COMPETITORS

• Similar, high-end boutiques: English Rabbit, Piccolino Children, Aunty Barbara’s Kids, Couture Kids on Robertson, Monnalisa Beverly Hills
• Global and Nationwide big brands include: Carter’s (see financial highlights), Gymboree, Children’s Place

INDIRECT COMPETITORS

• Target, Old Navy, Walmart
  
  Competitors are other baby and children’s retailers, selling both apparel and accessories. Direct competitors would be stores which solely focus on baby and children’s clothing, especially those similar boutique stores. Many resell high-end fashion brands such as Givenchy Kids, Dolce & Gabbana, and Versace Kids. Larger name brand stores are also direct competitors, though they have a larger scale and financials than our local boutique competitors. They offer a larger volume of mass-produced products for lower prices than upscale boutiques, which offer limited amounts of more unique pieces. The indirect competitors listed are stores which sell baby and children’s clothing/accessories, but not as their primary product selection.