Cover Letter

March 13, 2012 Caroline Blue, Vice President Bank of The West 401 SW Fifth Avenue Portland, Oregon 97204 Dear Mrs. Blue: As we discussed at our meeting on March 3, I am enclosing the business plan to support the loan request for $600,000 for the start up of my clothing boutique Electrik Unicorn. Thank you for the consideration. I look forward to hearing from you soon and the potential of gaining a long-term relationship with Bank of The West. Sincerely, Brittney Wooten Electrik Unicorn 3408 Southeast Hawthorne Boulevard Portland, Oregon 97214 712 936-5555 Brittney@electrikunicorn.com

Prepared by:

Brittney M. Wooten Owner/CEO of Electrik Unicorn

Electrik Unicorn 3408 Southeast Hawthorne Boulevard

Portland, Oregon 97214

712 936-5555 Brittney@electrikunicorn.com, www.electrikunicorn.com

Date Prepared: March 3, 2012

Contents

Executive Summary Business Overview Critical Success Factors The Management Team The Market Financial Plan Management Plan Business Structure Management Team Management Compensation Personnel Compensation Key Advisors/Directors Communication Governmental Approvals Merchandising/Product Plan Merchandise/Product Description Unique Characteristics Proposed Lines Proprietary Aspects Six-Month Merchandise Plan Merchandise Assortment Market Trips Markup/Markdown Policies Brick-and-Mortar Location Plan Physical Location Location Features Target Market Considerations Leasehold Improvements Other Location Costs Signage Web Plan Summary Overview Internet Strategies Online Marketing Strategy Web Development and Hosting Costs Buying and Shipping Methods Future Features

Marketing Plan Industry Profile Market Economic Factors Market Analysis Summary Market Needs Customer Profile Future Markets Competitive Analysis Competitive Advantage Pricing

Pricing Strategy Price List Pricing Policies

Market Penetration Brand Strategy Advertising and Promotion Sales Strategy Publicity Promotional Events

Evaluating Marketing Efforts Financial Plan Sales Forecast Cash Requirements Break-Even Analysis Projected Financial Statements

Monthly Cash Flow Statement Year-End Income Statement Year-End Balance Sheet Ratio Analysis

Retail Operations Reporting Policies Employee Development Staffing Levels Hours/Days of Operation Inventory Control Security Systems/Shrinkage Control Appendix

Executive Summary

Business Overview: Brittney Wooten created Electrik Unicorn LLC in 2012. Electrik Unicorn LLC is a clothing boutique; catering to women 18-35 years old; seeking carefree, eclectic, and fun apparel, accessories, and shoes. Merchandise sold will have size ranges SML and European sizes 25-32. The merchandise is moderately priced; with price ranges that do not exceed $500. Electrik Unicorn LLC is located in the Hawthorne District neighborhood in Portland. This location offers customers a numerous amount of eclectic and unique shopping experiences. This business is located in a high traffic area, and will be successful because there is a market for our customer here. Reed College is located in the vicinity to this location. Our customer is very eclectic, she enjoys music and art festivals, fashion, DIY(do it yourself) projects, and has an interest in sustainability. Brittney Wooten will act as the owner, manager, and bookkeeper of Electrik Unicorn LLC. The management team has years of experience and education in fashion marketing and merchandising. Brittney will employ an assistant manager and manager in training to sum up the management team. Two part time sales associates will be employed to help with daily tasks. Brittney understands the need of having outside members involved in Electrik Unicorn LLC. She will hire an attorney to handle legal obligations as well as an accountant to make sure Electrik Unicorn LLC is staying on target financially. More information can be seen in the management plan. Electrik Unicorn LLC will provide customers will an exceptional assortment of merchandise. Merchandise sold highlights new emerging designers, local Portland designers, and a few established brands. Electrik Unicorn LLCaQ customers are trend driven; we take pride in providing merchandise that fits the needs of our customers. The main focus at Electrik Unicorn LLC is customer service. Making sure we are meeting the customer’s needs and wants is very important. Critical Success Factors

• Provide customers with quality customer service. • Maintain our stock and inventory. • Offer an assortment of sizes and fits based on our target customer.

The Management Team Electrik Unicorn’s management team is the core of this business. Our

managers are highly trained, educated, and talented individuals. Managers will be required to have a degree the related field of marketing/fashion marketing etc. Or equivalent management work experience. The management team will consist of the manager, assistant manager, and manager in training. It is crucial to protect Electrik Unicorn LLC financially and legally. Outside support will consist of an accountant and attorney. The Market

The market in Portland, specifically in the Hawthorne District is on the rise. Hawthorne District is becoming gentrified at a fast pace. Making it one of the hippest up and coming neighborhoods; while it still maintains the counterculture vibe it has always had.

Management Plan

Business Structure

Electrik Unicorn is planned to open it’s doors summer 2012. Management Team

Owner/compensation

Brittney Wooten graduated from Savannah College of Art and Design-Atlanta with a BFA in fashion marketing & management. She has of 5 years of retail and customer service experience, and 2 years of public relations experience. Her education and industry experience has provided her with excellent skill. She will be involved in everything that goes on in the store. She will do the bookkeeping, train employees, visual merchandising, and will determine markups and markdowns. Brittney will also act as the buyer and head manager of Electrik Unicorn. The owner will receive $1,500 per month for the first six months; this draw will increase to $2500 per month at the start of the seventh month in business.

Assistant manager

The assistant manager must have relevant education in marketing, business, or merchandising, or the equivalent work experience. The assistant manager will have a number of roles in the store; including opening and closing the store. They will act a team leader and will assist the owner in training the rest of the team. The assistant manager must have the ability to make decisions quickly; and will report to the owner of the store.

Manager In Training The manager in training is responsible for all responsibilities in the store; including merchandising, sales, and even training the sales associate(s). The manager in training; is responsible for training themselves. They will open and close the store. The manager in training will provide a store experience reflective of Electrik Unicorn’s core values to the customers. Management Compensation

The starting salary for the assistant manager will be $25,000 per year and will include benefits and paid vacation. Manager in training will receive a salary of $22,000 per year benefits will be included as well as 2 weeks of paid vacation. Benefits include health, dental, and eye care. Full time

employees will get 401 K, life insurance, and disability. Electrik Unicorn employees receive a employee discount of 40%. The owner of the store has the right to change policies retaining to insurance and benefit packages. Sales associates/ Personnel Compensation Part time sales associates will earn an hourly wage of $8 per hour. Part time associates must work a minimum of 20 hours per week. Sales associates must have previous retail experience or the equivalent education. Their roles are to provide excellent customer service, tidy the store, assist in merchandising the store. Their work schedules are based on personal schedules. Each associate’s work rotation will change weekly. Sales associates will also receive an employee discount of 40%. Key Advisors/Directors Electrik Unicorn will rely on a trust worthy accountant and lawyer. The owner will do bookkeeping; however an accountant will still be hired to make sure the store is succeeding in the way it should financially. It is important that Electrik Unicorn be protected legally the owner will hire her uncle a local attorney in Portland. Key advisors will receive a 40% discount on merchandise. Accounting Chloe Best Perkins & Co 1211 SW Fifth Ave, Suite 1000 Portland, Oregon 97204 Legal Todd Wooten Perkins Coie 1120 NW Couch Street Portland, Oregon 97209 Communication Electrik Unicorn utilizes an open door policy when it comes to communication. All employees are open and encouraged to voice their ideas and opinions on events, marketing, merchandising, and ways to improve the store. There will be a list of store policies and procedures for following policies posted for all employees to view. Staff meetings will be held weekly on Mondays when the store is closed for inventory days. Staff will receive educational training on new merchandise, store policies, and security training at these meetings as well.

Governmental Approvals

The Federal Trade Commission makes governmental approvals. All merchandise sold in Electrik Unicorn must be tagged and labeled correctly with information retaining to where the products were made, fiber content, and size. Sustainable products sold must be labeled with tags stating the authenticity of the products. The owner and all employees of Electrik Unicorn are fully aware of regulations that retain to proper merchandise tags and labeling.

Merchandising/Product Plan

Merchandise/Product Description

Apparel, accessories, and shoes will be sold at Electrik Unicorn. The merchandise sold will consist of 50% apparel, 25% accessories, and 25% shoes. Assortment Classifications: Tops Bottoms Outerwear Dresses Accessories (bags, hair accessories, and jewelry). Shoes Unique Characteristics Electrik Unicorn prides itself on providing a mix of established brands; combined with new up and coming designers. There will also be a few local Portland designers sold in the store. It’s very important to support local designers; and it is beneficial for both the designers and the boutique. It is a way to promote their brand; and we don’t have to front the cost to pay for it. Electrik Unicorn also wants to represent the sustainable lifestyle of Portland. We carry a few brands that are handmade in New York, Portland, and California. Quality is the most important factor we took into consideration when buying brands. Merchandise sold does not exceed $500. Proposed Lines

• Thomas IV • Eighteen • Opening Ceremony • Whit • Dana Lee • Samantha Pleet • Kaelen • Common Projects • Jeffrey Campbell • Gretchen Jones • Rachel Comey

• William Okpo • Steven Alan • Nettie Kent • Lauren Manoogian • Mary Meyer • Proudrace • For Love and Lemons • Creatures of Comfort • TenOverSix • Laura Lombardi • Upstate • Dolce Vita • Opening Ceremony • Wood Wood

Proprietary Aspects

Brands sold in Electrik Unicorn are made by new independent designers nationally; as well as established brands. As Electrik Unicorn successfully gains recognition and an excellent reputation; the owner will design and sell the private label in the store. This line will be exclusive to Electrik Unicorn customers. All private label merchandise will be labeled with Electrik Unicorn tags. Market Trips The owner Brittney Wooten will attend market trips two to three times a year; to buy merchandise for spring, summer, and fall. Travel expenses will be included in the open-to-buy section of the financial plan. Brittney will travel to the Los Angeles Apparel Market, Magic in Las Vegas, and Dallas Apparel and Accessories Market. Where When Objective Los Angeles March To buy merchandise for summer Las Vegas August To buy merchandise for winter Dallas June To buy merchandise for fall

Markup/Markdown Policies

Electrik Unicorn will maintain fashion trends that reflect our customer’s personality each season. By listening to our customers we will be able to get merchandise in and out quickly; and not have to do very many markdowns at the end of the season. Markdowns will be given to merchandise mid-season on merchandise that is not being sold fast enough. Electrik Unicorn will only markdown merchandise that is not moving quickly, damaged, or over bought. Markdowns will slowly change until merchandise is completely moved out. The first markdown will be 10% then 20% and eventually up to 40-50% off regular price. The owner will be responsible for determining markdowns the assistant manager will assist the owner. Most markdowns will occur midseason during the fall/winter season in order to get merchandise pushed out to make room for spring inventory. Electrik Unicorn will markup merchandise 40% retail (keystone method). Wholesale inventory will be marked up double the original cost.

Brick-and-Mortar Location Plan

Physical Location Portland is considered to be a walking city. Our location in the Hawthorne District is pedestrian friendly; customers can also drive, or take public transportation. Street parking for our customers will be provided. This location is a high traffic area, and will generate a lot of foot traffic into the store. The store design is very reflective of Portland’s sustainable lifestyle. This is beneficial for the owner because it will keep energy costs down. The materials used are reclaimed woods, chairs made from recycled generators, plants, recycled fabrics, and glass. There are three POS systems in the store, stock room/office, and a bathroom available to employees and customers.

The square footage of the store is over 1,800.

• Store and dressing rooms: 1,234 SF • Office and storage: 218 SF • Employee room: 86 SF • Window display: 193 SF

Location Features

Electrik Unicorn is located in the Hawthorne District neighborhood in Portland. The neighborhood is known for being the home of the hipsters from generation y and x. The owner wanted to put the store in a place that reflected her personal style as well the customer’s. Hawthorne District is exactly where her customer is located. Hawthorne is a walking and bike riding community, however customers can drive and public transportation is also provided. This location being pedestrian friendly will generate a lot of foot traffic into the store. Hawthorne District is located in the city of Portland; but it embodies a laid-back, fun, and vibrant vibe. The neighborhood is becoming gentrified at a steady pace; but it still maintains the lovely countercultural feel it has always had. Hawthorne contains a numerous amount of retail stores, eclectic boutiques, character houses and apartments, moderately priced restaurants and bars, and record stores. The residents are hipsters from generation y and an older resident from generation y. There is also a college located in the vicinity of the location. This location is great for Electrik Unicorn, because we can get a range of ages from our target customer.

Target Market Considerations The mission at Electrik Unicorn is to become the number one boutique that specializes in eclectic and carefree merchandise for women ages 18-35. We will be successful at this because we value our customers and listen to their wants and needs. Customer service is one of the most important things to the owner of Electrik Unicorn. We are here to serve the customers and make sure they enjoy their experience with us each and every time. We will provide the customers with excellent customer service, quality merchandise, exceptional assortment selections, and beautiful visual merchandising. Achieving profit goals is very important; but our main goal at Electrik Unicorn is to keep pleasing the customers and keeping them in the door long term. Another main focus is gaining recognition as one of the best retail stores in the city of Portland. Electrik Unicorn takes a lot of pride in providing customers with exceptional customer service and a great selection of merchandise. Leasehold Improvements Electrik Unicorn is located in an existing retail location. The owner hired Ji-Young Hwang; a friend and interior designer in Portland. Leasehold improvements include painting, wallpaper, lighting, reclaimed wood flooring, custom design treatments to walls, and bathroom remodeling. The total amount for the improvements is $25,000; including money spent on custom furniture, clothing racks, and display boxes. Signage The dimension for the signage is 1’3(h) x 9’(w) x 1’(L). The material is black acrylic. It will not be one large piece, and is calculated by letters. The letters are roughly $86 each and will cost under $1290. The signage will be easily viewable by both pedestrians and drivers.

Web Plan Summary

Overview

Electrik Unicorn is a new store, we will not be selling merchandise on a website until at least the second or third year the store has been open. The brick-and-mortar store needs to gain recognition before going into e-commerce. We will still send customers email blasts concerning sales, promotions, new inventory, events, and advertised merchandise. Internet Strategies/ Online Marketing Strategy

Electrik Unicorn customers are extremely technologically savvy. They also find information out by the use of WOM (word-of-mouth). Our younger customers tend to be heavily involved in social media. Their favorite sites to get information are Facebook, Twitter, Pinterest, and Tumblr. Our social media sites will be updated daily; in order to connect with customers about store events, sales, and new inventory. Social media is a great way for customers to share their in-store experiences with us.

Marketing Plan

Industry Profile Sustainability is becoming more and more of a popular trend; especially amongst the younger generations. From higher end to fast fashion; more retailers are starting to offer eco-friendly products. Companies such as fast fashion retailer H&M have an eco-friendly line. The problem with that is, are these items really sustainable at the fast rate they are being produced. Another concern younger generations have; is that they want products that look trendy and not obvious sustainable. However, customers are willing to spend a little more if they are getting top quality eco products.

Market Analysis Summary

Electrik Unicorn customers are females age 18-35. She a care free, fun, young, and urban woman. She has strong interests in fashion, art, music, film, and sustainability. She lives a healthy and active lifestyle, and loves to take care of herself. Our customer is conscious about the environment and is a huge animal lover. Electrik Unicorn’s customer has a disposable income; because she has no children. She doesn’t mind spending more on products; and she loves Made In America.

Market Needs

Electrik Unicorn specializes in eclectic sustainable and non-sustainable apparel, shoes, and accessories for women. We also specialize in offering new independent designers, American made, and local Portland designers.

Customer Profile

• Females 18-35 years old. • Seeking eclectic, young, and playful apparel, accessories, and shoes. • Come from diverse cultural backgrounds. • Personal style: Carefree, young, urban, quirky, rebellious, playful, and

socially responsible. • Student or working professional in a creative industry. • She enjoys shopping, music and art festivals, do it yourself projects,

and Pinterest, Tumblr, and DIY blogs. • She is a city dweller. • She enjoys quality moderately priced products. • Spends at least $1,000 on clothing per year. • Yearly income is $45,000+.

Future Markets

At Electrik Unicorn, our main focus is providing customers with what they want. Our customers are extremely trend driven, we pride on staying on top of the latest trends that apply to our customers. Consistency of merchandise will be maintained based on the amount of inventory and sizes. Electrik Unicorn will maintain it’s square footage of 1800 SF for the first two to four years. Electrik Unicorn’s private label and possibly menswear will be added in the future. An ecommerce site will also be an opportunity used in the future as the store gains recognition.

Competitive Analysis

There is one store in Portland that is Electrik Unicorn’s direct competition. Electrik Unicorn’s direct competition is local Portland boutique Frances May. Frances May is located at 1013 SW Washington, Portland, Oregon, 97205. The store is opened Tuesday through Saturday from 11am-7pm and Sunday 12pm-6pm. There is street parking located in front of Frances May, as well as a bike area for pedestrians. Frances May is our competition based on target market and merchandise assortment, and sizes. Frances May is located more in the downtown area of Portland, while Electrik Unicorn is more south of downtown Competitive Advantage

Frances May is located in a more traditional expensive location. There isn’t a lot of parking for customers that are driving. Electrik Unicorn is located in a more vibrant and eclectic neighborhood. We offer parking for customers that are driving to our store. We really understand the wants and needs of our consumers. Merchandise sold at Electrik Unicorn is more moderately priced than our completion. We also carry some brands that aren’t being sold in other stores in Portland.

Pricing/Pricing Strategy/policy

Merchandise sold runs between $20 all the way up to $500. Merchandise that doesn’t sell out fast will be marked down mid-season starting off at 10%, then 20%, 30%, 40%, and so on. Electrik Unicorn will not typically mark down merchandise. Only slow selling merchandise will be marked down to make room for new inventory.

Price List Tops: $50-$250.

Bottoms: $60-$200

Dresses: $70-$230.

Outerwear: $60-$500.

Shoes: $100-$400.

Accessories: $20-$300. Market Penetration/brand strategy

ELectrik Unicorn will the Internet mostly has a method advertising, as well as the local newspaper and radio. Radio stations will be those that target an indie/hipster audience such as our customer. We want to convey the message of our excellent customer service and ability to stay on top of trends. Our main goal is to be recognized for having the best customer service in Portland. Advertising and Promotion

Electrik Unicorn customers are between the ages of 18-35. They are very technologically savvy and also rely on word of mouth for information. We will utilize social media outlets such as Facebook, Twitter, and Tumblr, and email to communicate with our customers. Email blasts will be sent out no more than once a week. Internet communication will keep budget cost down as well since it is free to use these media outlets. Sales Strategy In order to keep up with the amount of sales; we will ask customers for their zip code to input into the point of sale system. This will also help us to keep up with how often things are being sold and the particular customers that are buying them. All employees will keep customers updated on store events, sales, and new shipments. Our top customers will receive hand written invitations to in-store events and special sales promotions. Publicity

All employees are encouraged to share their ideas when it comes to publicity and in-store events. The owner will create press releases and contact the local press. Promotional Events Electrik Unicorn will host various in-store events throughout the year. Events will consists of DIY workshops, holiday sales/promotions, and trunk shows with local apparel of jewelry designers, in-store band, and we will have a booth at Musicfest NW. Evaluating Marketing Efforts Marketing efforts will be evaluated closely, and we will make changes when necessary. Weekly sales and volume will be documented; by the owner and assistant manager.

Financial Plan

Sales Forecast

The sales forecast for Electrik Unicorn LLC can be found in the financial planning spreadsheets. Cash Requirements

The owner of Electrik Unicorn LLC is requesting a loan in the amount of $600,000. This will cover the startup cost and to purchase inventory. Projected Financial Statements

Monthly cash flow statement (for at least one year and until the business shows a profit)

Year-End income statement

Year-End balance sheet Ratio analysis

Retail Operations Plan

Reporting Policies

Staffing levels are a “trickle down” affect. The assistant manager is responsible for reporting to the owner of Electrik Unicorn. The manager in training reports to the assistant manager; and the sales associate(s) report to the owner or assistant manager. All report information must be documented and sent to the owner no more than 24 hours later. Employee Development Employee meetings/workshops will be held at least; once a month by the owner of the store. The meetings will retain to customer service, customer satisfaction and expectations, and store policies. These meetings/training sessions will most likely be held on Mondays when the store is closed. Training will be mandatory for employees of all levels. Staffing Levels

Hours/Days of Operation

Electrik Unicorn will be open Tuesday through Saturday from 10am-9pm and Sunday 12pm-6pm. We will not be open to the public on Mondays; as that will be our inventory day. Inventory Control Physical inventory will be done by the owner of; Electrik Unicorn Brittney Wooten. At the start of winter in January, and the start of summer in July. The owner or the assistant store manager will evaluate invoices, dates merchandise was received, and the prices of all merchandise. Security Systems/Shrinkage Control Electrik Unicorn will utilize security systems to prevent shoplifting. All

merchandise sold will have security devices on them. In-store purchases made my employees will be ran through by management; and put away until the end of the work day in an authorized area. Outside packages for employees sent to the store; will go through inspection by the owner first. The owner will bring in security or police officers to train employees on how to handle shoplifting, reporting theft, and safety precautions.

Appendix

Resume for Brittney Wooten

Electrik Unicorn Organizational Chart

Store Design Plans

Purchase Order Form

Sources

Fashion Entrepreneurship Retail Business Planning, Second Edition. Michele M. Granger and Tina M. Sterling. 2012