Business Plan 2012. 2. Business Plan. November 13, 2012. Prepared by:
Daniela Vukadinovic, Executive Manager. TASCHEN Books. 1600 Peachtree
Street,.
Business Plan TASCHEN Pop-Up-Bookstore By Daniela Vukadinovic FASM 410
Business Plan 2012
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Business Plan 2012
Business Plan November 13, 2012
Prepared by:
Daniela Vukadinovic, Executive Manager TASCHEN Books 1600 Peachtree Street, Atlanta, Georgia 30309 404-534-9089
[email protected] www.taschen.com
© TASCHEN 2012 All right are reserved. Private and Confidential. No part of this business plan can be copied or distributed without prior written consent of TASCHEN. The content of this plan is confidential and is the sole property of TASCHEN. Any reproduction or divulgence of the content of this report without the written consent of TASCHEN is prohibited.
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Dear Sir/Madame,
Business Plan 2012
My name is Daniela Vukadinovic and I am an executive manager of the future TASCHEN Pop-Up-Bookstore. I have created this business plan in order to introduce my concept of opening a five week Pop-Up-Bookstore in Lenox Square in Atlanta. The main reason that triggered such decision is to expand and test the new market. I believe that Atlanta needs a modern and artsy bookstore, with a great assortment of books in the fields of design, fashion, film, photography, architecture, art, pop culture, lifestyle, travel, and classics. TASCHEN books are considered cultural enlightenment and they offer colorful variety of lavish limited editions at affordable prices. It is one of the most successful and unique publishers in the global market, distributed worldwide in over twenty languages, and since Atlanta is becoming an international city, it would be great to test the market. Also, Atlanta being a very cultural and artistic city with colleges such as: SCAD, Art Institute, Georgia Tech, Georgia State, and Emory, it would provide a great ground for a further development. The Pop-Up-Bookstore will be set up for five weeks, and my plan is to create an amazing shopping experience by providing a good read for many tastes. However, in order to execute my objectives, I am creating a business plan which will contain all the important aspects of my business thoroughly described step by step. I will present an executive summary, management plan, merchandising plan, pop-up location plan, Web plan summary, marketing plan, financial plan, retail operation plan, and lastly I will evaluate the results.
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Business Plan 2012 Executive summary
The purpose of this business plan is to create a thorough strategy for opening a TASCHEN bookstore as a five week Pop-Up-Shop in Atlanta area. The reason for introducing it to the city of Atlanta is its cultural variety of artists, students, and a large number of international population that is on the rise. The Pop-Up-Shop will take place at Lenox Square in Atlanta. The reason for such decision is the high foot traffic, a high number of international tourists, and a wide variety of different high-end stores. Also, Lenox is a number one destination to go to when pursuing gifts, and TASCHEN books make a unique and creative present. The bookstore will feature samples of the books from each field of culture and arts that the company carries. The TASCHEN Pop-Up-Bookstore provides an opportunity for residents of Atlanta to experience books through different and unique approach; the state-of-the-art interior and the great visual design of TASCHEN books. The contents of the books will inspire the creative people of the city and even invite the ones who are purely interested in physical aesthetics of the product. Overall, it will spur the creativity and innovation which is essential for wellbeing of the city of Atlanta. Anyways, this will be a great opportunity for the company to introduce itself to Atlanta because there isn’t any direct competition in the region. The South-East is 4
Business Plan 2012
missing this segment of the industry because there aren’t any bookstores that offer innovative and creative books within a modernly designed space.
The management team will consist of an executive manger, and an additional two employees who will help on the selling floor and take orders from customers. There will only be a day of training provided to employees since all they will need is knowledge and familiarity with merchandise and order forms. The employees will be paid by the fixed daily amount, plus bonus if projected weekly sales are exceeded. The store will carry mostly samples of the new and upcoming titles, so there will be no need for inventory. The samples will be for sale on the last day of the Pop-UpStore, and all the unsold samples will be sent back to the TASCHEN headquarters, because we will work on consignment. The physical space of the Pop-Up-Shop will be leased, and the interior will be designed by Australian industrial designer Marc Newson, who is feature on the TASCHEN website. The Company will rent the contemporary furniture he designed and it will be a way of promotion for the designer as well. The hours of operation will be from Monday to Saturday from 10:00 a.m. to 9:00 p.m. and on Sunday from 12:00 p.m. to 6:00 p.m., same as the Lenox Square. The funds will be obtained in a form of line of credit from a bank.
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Business Plan 2012 Management Plan
Key to the Entrepreneur The management team will consist of executive manager and two additional employees. The employees will have to have a background in art and design in order to provide solid information to customers. The additional training will be provided in order to give a brief introduction on the company’s culture and train them to take orders from customers. Since there will be no register, that part of the training would not be necessary. All of the orders will be made through the company’s website and shipped the same day from the closest store. There are 4 physical locations of TASCHEN bookstores in the U.S.; New York, Miami, Beverly Hills, and Hollywood. After the one-day training, the employees will sign a document that specifies responsibilities, rules and regulations, and guidelines. All employees will be responsible for greeting the customers, selling the merchandise, and taking orders. Executive manager will be present in the store throughout the entire day, while the employees will work in shifts. The shifts will be 6 hour long, and the employee that is working the first shift will have the responsibility of opening the store together with the manager and making sure everything is clean and ready for operation. The employee that is working the second shift will be responsible for closing the store together with the manager and make sure that everything is in order for
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the following morning. On Sunday, there will be only one shift, where a manager and an employee will be working, while the third employee will have a day off. If any problems regarding honesty occur, or if the employees do not abide by the
rules and regulations of the company, they will be called in for a disciplinary meeting and depending on the seriousness of the situation; the final result might be termination.
The Market The bookstore business has suffered a lot since the economic crises, but since TASCHEN is a worldwide company, it continued its business with the same pace, not being affected by the recession. Further information about the market trends will be covered in chapter “Marketing Plan.”
Financial Plan Will be thoroughly in depth in the chapter “Financial plan” on page 22.
Compensation Compensation will be based on the average annual salary for bookstore employees in the U.S. The average annual salary for bookstore managers is $44,000 according to indeed.com, I have divided and calculated that my employees would get $100 daily for working a shift of 6h. Also, they would receive bonus of 5 % of the weekly sales, if the actual sales exceed projected expectations. They will be motivated to
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work for extra commission, and there would not be any unfair competition since they will work in different shifts.
Key Advisors The key advisors will be the representatives from the headquarters of the company, which is in Berlin, Germany. Since the TASCHEN Pop-Up-Bookstore has been previously done in Hong Kong, they will be a good source of information and advice on the business.
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Business Plan 2012 Merchandise/Product Plan Merchandise carried in the Pop-Up-Bookstore will include all New Titles of every Theme that TASCHEN carries on their Web Site, while All Titles (Old and New) will be available for order online through our store; which would ship the same day.
Unique Characteristics TASCHEN is the only publisher that has a catalog that contains the truly arcane, such as The First Six Books of the Elements of Euclid, to monographs on starchitects like Santiago Calatrava, to “sexy books” like The Big Book of Breasts 3D. It has a very eclectic assortment of titles. It is considered as an international publishing house that produces books on “art, anthropology and aphrodisiac.” It unifies, simplifies, amplifies, and provokes the audience. The brand is pushing against the boundaries of society whether they are moral, racial or social perspectives, which unifies the working team. It is focused on delivering beautifully printed books with high-production value on a range of topics. Also, it simplifies the area of one’s life. Moreover, the magnetism of the books inspires a devoted worldwide following. TASCHEN might also have a “big is better” mantra. Its artist editions and “XL”-format
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books are a distinctive signature and can cost thousands of dollars, which TASCHEN offers for less than a $100. 1
Proposed Lines The TASCEN themes included are: Architecture, Art, Classics, Collector’s Ed., Design, Fashion, Film, Lifestyle/Travel, Photography, Pop Culture, Sexy Books. Also, as our special edition series, we will offer Simple Diary™. Simple Diary™ is a book designed by Philipp Keel in rich and bright colors as a simple tool for readers to create unique and memorable daily records. It stands apart from other dull and blank journals.
5 Week Merchandise/Buying Plan Since the buying will be done one time only, before the set up of the Pop-UpStore, there will be no need for a five week merchandise plan, because it will all be presented in a one major buying plan prior the opening of the bookstore. Each theme will carry either just a sample or an additional copy; depending on the price and popularity of the book. The merchandising and buying plan will be presented in the following section “Merchandise Assortment.” Moreover, buying will be done on consignment with the U.S. TASCHEN headquarters in Los Angeles.
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Information on the page gathered from Cliff Kuang, editor of Fast Company http://www.fastcodesign.com/1665057/unify-simplify-amplify-how-taschen-continues-to-provoke
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Merchandise Assortment
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Business Plan 2012 Market buying trips needed Market buying trips would not be necessary since the products will be brought in bulk one time before the opening of the pop-up shop. The pop-up shop will hold 1 to 2 pieces of each title presented in the physical store. All additional needs will be ordered online and delivered straight to our customers providing the same day shipping.
Markup/Markdown Polices Markdown policy would not be necessary to consider because we will not be in need to sell all of our unsold merchandise since we will work on consignment with TASCHEN’s U.S. Headquarters. We will not be marking up the books because we want them to be the same price as they are on the original Web Site. Instead, we will get the books from TASCHEN for our physical inventory with 50% discount from their retail price. Also, we will be selling all of their books through our in-store iPads and will offer same day shipping. From those sales, we will receive 10% of each sale we make that is not in our physical inventory. Also, there will only be 1-3 samples of each title, and the books of only one title will be samples not for sale. However, on the last day, our customers will be able to buy all the 1 piece samples. Yet, if there are any unsold books, we would send them back to the U.S. TASCHEN headquarters which is in Los Angeles.
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Business Plan 2012 Brick and Mortar Location Plan
Physical Location The Pop-Up-Bookstore will be taking place in Atlanta, Georgia. The reason for choosing this city is the lack of creative and unique modern bookstores. Atlanta is a cultural and artistic city and is regarded to be the hub of one of the best art and technology colleges.
Target Market Considerations TASCHEN bookstores offer products in the range of art, culture, design, and lifestyle and the interiors of the bookstores around the world are very modern and inspiring, just what creative students need in order to thrive in their fields of studies. Due to that, there is a high demand for such a product in this area. After thorough pondering, the decision was made that the brick-and-mortar popup shop should be located in Lenox Square. The reason for such conclusion is the fact the Lenox Square has high foot traffic, and is the first thought that pops to mind when thinking about shopping for gifts. Also, there is a lot of international tourists because of high concentration of the hotels which surround the shopping center.
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Business Plan 2012 Look of Pop-Up-Shop (Layout) “Taschen’s superb branding extends to its stores, which are sanctuaries of culture designed by Philippe Starck. Each is tailored to its location while clearly evoking the cohesive essence of the brand. In a smart move into co-branding, the publisher opened a “shop within a shop” at the Art Institute of Chicago. The company’s presence is equally impressive at book fairs, with installations designed by Shigeru Ban and as a semi-annual “magalog” that boasts rarified advertisers such as luxury automaker Maybach and Monocle magazine." 2
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retrieved from :http://www.fastcodesign.com/1665057/unify-simplify-amplify-how-taschen-continuesto-provoke
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The borrowed furniture for the interior of the bookstore will be: 2 regular short shelves, 1 Tangram shelf, 1 white boxy shelf, 2 tall black tiered shelves, 2 short white
tiered shelves, 4 arm chairs in color, 2 pairs of 2 overlapping red tables, and a counter in the middle of the store. Further details about the furniture and visuals will be presented in the PowerPoint.
Location Features The location of the Pop-Up-Shop will be on the second floor at Lenox Mall, where the traffic is pretty busy, in the corner of three exits. This place spot should be very good position for the bookstore since the 2nd floor is the busiest, and also carries the most high-end design shops. The store is open, without any glass windows; there will be a need for a signage above the entrance and two easels for announcements. Since the shop is exactly on the corner, it can be approached from the side, as well, as the main entrance.
Leasehold The required length of the lease is five weeks, so we have decided on renting the entire space. This is mainly because we want to bring our own interior design team and create the aura of the real TASCHEN experience. Also, by leasing a part of another store, we would lose that unique touch of TASCHEN modern and creative culture and our product would lose personality and individuality. Due to this, the Pop-Up-Shop will be free standing. The space we decided to lease is on the 2nd.floor, on the main mall level, 15
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near the main entrance. Monthly lease would be around $15,000, with consideration that the Pop-Up-Store will last more than a month; roughly 5 weeks. There will not be any further need to compensate for anything else, because maintenance, insurance, and utilities such as heating and air-conditioning would be included in the lease.
Signage Signage will be above the main and two side entrances. The signage will be made of plastic, rectangular shape, medium size. Also, there will be two easels at the both sides of side entrances promoting the titles and upcoming events every day.
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Business Plan 2012 Web Plan Summary In order to advertise the opening of the Pop-Up-Shop in Lenox Square, we will be using social media such as Facebook, Twitter, Instagram, and forums and blogs on the official TASCHEN Web Site. These mediums will be the source of information regarding location and provide a schedule of social events and guest the bookstore will have during the period of five weeks. However, TASCHEN Company already has an official website for all its stores around the world, due to this, developing a new Web site would not be necessary. The pop-up shop will be hosted on the website in the header as a separate additional
tab,
which will read “Atlanta Pop-Up-Shop.” The visitors of the website will be able to click on it and access all the information about the store, assortments of the merchandise, schedule of events and guests, and will be able to track tweets, and Instagram photos of the venues that will change on a daily basis. Since the Website host for the Pop-Up-Store is an original TASCHEN Web Site, it will carry all the books it usually does. The brick-and-mortar Pop-Up-Shop will only have the samples of each book and the customer will take orders in store or on-line, and it will ship immediately. The products that TASCHEN carry are books in the field of: Architecture, Art, Classics, Collector’s Edition, Design, Fashion, Film, Lifestyle/Travel, Photography, Pop Culture, Sexy Books. The highlight will be on: New Titles, Coming Soon, Bestsellers, and Back in Print. In the pop-up shop, there will also be magazines, because that is how that company first started; as a magazine and book printing company. 17
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In order to drive sales, there will be an e-model that will advertise daily deals
which will be available upon the visit of the physical pop-up shop. If the customers sign up for the newsletter from TASCHEN, they will get a membership discount for the first purchase, and the “private sales” deals and packages. The website will require a high maintenance every day because of the variety of social media involved as well as the fact that we want to come across as hip and up-todate company which offers a unique and fresh services to our customers. We want them to engage in our forums and blogs, and feel excitement and anticipation each day when they access the “Pop-Up-Shop Atlanta” tab on official TASCHEN Web Site. The costs involved in developing, and hosting, the site would not be applicable to the pop-up shop because the website will be using the company’s website www.TASCHEN.com. The maintenance for the website should cost around $300 for 5 weeks. 3
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according to the sources on the www.720media.com website and some other ones that I have researched. 18
Business Plan 2012 Marketing Plan Industry Profile On the basis, the bookstore business has been recently characterized by major consolidation trends and increasing internet sales. Independent bookstores continue to struggle for market share, sustain brick and mortar stores and implement new technology. Traditional bookstores in the past were very different than the modern bookstores of today; especially in design and layout. Traditional bookstores had only concentrated on selling books and did not provide any entertainment or experience for the consumer. The big chain bookstores are taking over the industry, but many smaller independent booksellers continue to exist while other independents are turning to the Internet in order to increase profits and survive. Currently, the retail book industry approaches 10,000 independent bookstores.
Market Economics Factors During the economic downturn, bookstore business has experienced lower sales because books are tied to whether consumers have much discretionary income. Now that the economy is beginning to improve, bookstore owners are coming under pressure from the many digital alternatives to traditional print books. Overall, the bookstore business is expected to become popular again. However, the bookstore business is far from dead and
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offers attractive opportunities by integrating the latest technologies with a cozy and inviting retail environment and customer experience.
Market Analysis Summary The changing marketplace is exerting great pressure on chain and independent stores. Consumers shop at superstores which also carry books which lead to closures of the small-scale bookstores due to low customer traffic. Currently, the retail book industry approaches 10,000 independent bookstores. 4 Yet, TASCHEN being a global company, and having a specific target market, it hasn’t been affected much by the downturn of the economy. Their bookstores around the world are still open and working till this day.
Customer Profile
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Information and the chart on next page are retrieved from: http://www.sbdcnet.org/small-business-research-reports/bookstore-2012
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With this basic chart that presents the consumer profile and spending power on books, we are able to identify the customer of our product and his/her behavior. The customer of TASCHEN is a student, a professional in either art or design, open-minded and creative individuals with higher education, and lovers of culture. Those individuals have higher disposable incomes therefore they spend between 60%- 156% on books, as presented in the chart on the previous page.
Competitive Analysis TASCHEN founder acknowledges Penguin as his main competiton “a great classic and innovative house.” But, stores like Anthropology and Urban Outfitters, can be considered as indirect competition, since they sell books that are very artistically driven and sell lifestyle as well. Despite the competition, we have a competitive advantage because we are a unique bookstore that sells a simplification of everyday’s life; we sell books on art, anthropology, and aphrodisiac. The books are designed for every taste, with extremely appealing visuals. They are very affordable as well.
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Business Plan 2012 Publicity Promotion will be done through our Web Site, Facebook account, Tweeter, Instagram, and blogs. Since there are already 4 TASCHEN bookstores in the U.S. and Atlanta’s creative crowd is very familiar with the products, I believe that these promotions will be just enough to attract them into our stores and test their interest.
Promotional Events We will have promotions every day for the period of five weeks. Some promotions will be passive; where we will have big signs promoting the New Titles or marking the Best Sellers, and active promotions; where we will have guest speakers coming in. We will not necessarily bring in writers, but more of experts in the fields of art, design, film, photography, and even adventurous people who would cover our books about lifestyle and travel. They will have book signing, open conversation, and panel discussion. Also, the fixtures and furniture will be designed and borrowed for use from the Australian industrial designer Marc Newson, who will also be invited to speak as a guest.
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Business Plan 2012 Financial Plan Pricing The actual retail price of the books offered in the Pop-Up-Shop will be the same as the cost of the books from the Web Site, yet we will receive a cost of 50% off from the retail price. For example, if the book is selling for $59.99, we have bought it for $29.99.
Price List The price of the books will range from $14.99- $1,000; with having one book of the lowest price and one book of the highest price as a sample. The average prices are $39.99 and $59.99. This discount is negotiated based on the fact that we will push the sales of other books on their Web Site, since we will be promoting the brand overall. For every book that sells online through us, and is not on our merchandise list, we will get 10% from that sale.
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Cash Requirements
Business Plan 2012
Required assets will be attained through a Bank in terms of line of credit. Projected financials for the Pop-Up-Bookstore will consist of certain necessities that will help this venture function in a profitable way. The first and foremost importance is to pay the lease which will be $15,000 for 5 weeks, all inclusive. Then, the total value of the inventory is $5,314.7, which will actually cost us $2,657.35 since we will get the merchandise for 50% off. However, since the pop-up-shop will work on consignment, everything that will not sell, will go back to Los Angeles headquarters. Compensation for employees will be $6,600 without a 5% bonus if the weekly sales projection is exceeded. Interior decoration and furniture will be borrowed from Interior designers such as Marc Newson, and other designer who would like to have their pieces of work exhibited in our pop-up store. For office supplies, there will be a need for 2 iPads in order to place online orders from our customers for products we do not have in our physical inventory; which will cost $800 together. Also, instead of registers, we will require 2 square card readers, for making payments, but cash will be accepted as well; that will cost about $100 total. There is also a need for signage in front of the store, which will require: 3 medium rectangular plastic boards that will go above the entrances on all three sides of the store. The cost of all the boards will equal about $ 300 5. In front of the store, there
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according to the website www.smallbusiness.costhelper.com 24
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will be 2 easels for promotion, placed on the both sides of the store announcing deals, promotions, and news; the cost of each easel will be $ 28.95 6. Maintenance for the Web site for 5 weeks will cost $ 300.
Marketing and Promotion will be free, since we will be using social media and our Web Site to advertise.
Break-Even Analysis In order to break even and profit, we would need to consider the projected finances and project the wanted sales and promotions. Since the total cost of the Pop-UpShop will be $25,405.25, we need to create sales that will cover and even exceed that amount. With selling the entire inventory for $ 5,314.7, we would pay off our inventory costs plus we would be $ $2,657.35 in profit. But to cover all the expenses of $25,405.25, we would need to have a net daily profit of $725.86. For example, for selling the books in our inventory, we will automatically earn 50% of that sale, but if we sell a book that is in stock on-line, we will get a 10% of that sale.
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according to www.globalindustrial.com 25
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So having this in mind, considering that an average price of a book is $59, and we get 10% of every book we sell online or 50% of physical inventory sold, it would mean that we need to sell around 11 books every day for 5 weeks in order to break even.
Projected Financials In order to profit with this Pop-Up-Bookstore, employees need to be motivated to sell 12 books daily, pushing the sales of the books in-store first, and then the on-line assortment.
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Business Plan 2012 Retail Operation
The pop-up shop at Lenox will be opened from Monday to Saturday from 10:00 a.m. to 9:00 p.m. and on Sunday from 12:00 p.m. to 6:00 p.m., same as the Lenox Square. There will be three employees working overall, but each shift will have two. First shift will open the pop-up shop and be responsible for a productive start of the business day, while the other shift will be closing the store and making sure that everything is ready for shift for tomorrow morning.
Market Penetration Since TASCHEN is a well establish company around the world, it has a lot of loyal customers. Even though there isn’t a company representative in the South East, the customer base which TASCHEN targets is well informed about the books and their culture. Also, a lot of people will eagerly anticipate to see a worldwide state-of-the-art bookstore that carries aesthetically appealing books. Since Atlanta is missing a good artistic, modern, and cultural bookstore, I believe that through good advertising and promotion there will be a great turn up during our five week Pop-Up-Store.
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Business Plan 2012 Brand Strategy The main strategy of the brand is to provoke the audience, with its eclectic book assortment, from arts to sexy books, and from classics to lifestyle/travel. The brand is pushing against the boundaries of society whether they are moral, racial or social perspective. It strives to unify, simplify and amplify all the themes in the world of culture, arts, and anthropology. They offer unique and colorful design with great visuals at affordable prices, so it is very appealing to students and culturally conscious creative individuals, who are primarily a target customer of the brand. TASCHEN is a lifestyle brand that has something for everyone’s taste.
Advertising and Promotion Advertising and promotion will be done through the main Web Site, with the click on the tab “Pop-Up-Store Atlanta.” We will advertise the opening in the magazine “Atlantan” the month before the opening. Also, the easels with our posters in front of the store will be announcing the daily deals and events.
Sales Strategy We are planning to achieve our projected sales through good advertisement and use of social media. The store will carry books of original prices and will match-up with the on-
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line deals from the TASCHEN Web Site. We will offer books that are not in our physical inventory as well, which will be available for purchase through our in-store iPads and
will be shipped the same day and delivered at their doorstep. In this way I believe we will boost up additional sales. From every book we sell on-line we get 10% sales from that purchase.
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Business Plan 2012 Evaluation The Pop-Up-Bookstore has a great chance in the Atlanta Market. We are presenting a great design of a product, integrating technology into our store, a state-ofthe-art interior layout, using social media, and bringing in professional and creative people. By incorporating all these aspect, we are providing our customers with great experience. This will be the test that will provide the answers of whether Atlanta is ready for the future of technologically innovative and modern bookstore. However, based on the statistics of our target market and Atlanta’s demographic, I firmly believe it will be a successful venture for both parties.
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Business Plan 2012 References:
Cliff Kuang, Fast Company. 23Sept.11. Retrieved from: http://www.fastcodesign.com/1665057/unify-simplify-amplify-how-taschen-continuesto-provoke Information on Page 13, retrieved from: http://www.fastcodesign.com/1665057/unify-simplify-amplify-how-taschen-continuesto-provoke Information on Page 17, retrieved from: www.720media.com Chart on Page 19, retrieved from: http://www.sbdcnet.org/small-businessresearch-reports/bookstore-2012 Information on Page 23, retrieved from: www.smallbusiness.costhelper.com Information on Page 24, retrieved from: www.globalindustrial.com Referenced throughout the entire paper: www.TASCHEN.com
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