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Ratika Chaudhary, Candace Hodgins, Sarah Jesberger Overview - Aritzia Who Market Buzz • Large Canadian retailer selling mid-range designer clothing to women. • “It’s the hot Canadian retail property right now… People are all bending over backwards to get Aritzia into their malls. They’re Canadian and they’re different.” • David Gray, President of Vancouver’s Sixth Line Solutions, a retail information and strategy company • Aritzia Saskatoon location – on 2nd between 22nd and 23rd Proposal Required • $200,000 in equity financing • Providing a 67% return Aritzia’s Advantage • Proven Sales • Strong Market Forecast for Saskatoon Overview Financials Marketing Conclusion Operations Questions Overview - Aritzia • Mission ‒ At Aritzia, we seek to inspire our customers by establishing a connection for them to the elements of urban culture. This is done by bridging fashion with elements of urban culture– specifically, clothing, accessories, and music. • Product ‒ Aritzia is selling an experience that begins in the store and is recaptured every time our customer wears our clothing. ‒ Product mix • 70% in house designs, 30% external brands • Price ‒ Average selling price of products = $90 Overview Financials Marketing Conclusion Operations Questions Marketing Target Market Females aged 14 – 30 Not tween market Overview Financials Marketing Strategy Price Styling preferences of women Average selling price of products = $90 Demographic spending habits Vertical integration leads to a competitive advantage Marketing Conclusion Operations Questions Aritzia’s Relevance to Saskatoon - Limited competitors - “Saskatoon and Regina continue to lead the country year over year in retail sales growth at 11% and 9.5%, respectively (2008 and 2009)” Colliers International – Saskatoon. The Knowledge Report Overview Financials Marketing Conclusion Operations Questions Customer Value Proposition 6 Current Boutiques LuluLemon The Bay Aritzia Other Mall Stores 4 2 0 Quality Overview Financials Price Customer Service Marketing Conclusion Diversity in Product Brand Recognition Operations Questions Financial Projections • Sales 4x the retail industry average • Conservative projections at $400/square foot in annual sales Sales Operating Expenses Overview Financials • Minimal capital outlay • Salaries and wages • Corporate Administrative charges as a % of annual sales Marketing Conclusion Operations Questions Financial Projections Base-Case Worst-Case • $400/sq. ft annually • 67% Rate of Return • $250/sq. ft annually • 9% Rate of Return Best-Case • $600/sq. ft annually • 133% Rate of Return IRR Overview Financials Marketing Conclusion Operations Questions Investor Value Proposition Excellent Rate of Return • Based on conservative sales projections • Low debt financing Growing Market • Proven sales • Established brand Funding Needs • Initial capital outlay • Initial Inventory Level Overview Financials Marketing Conclusion Operations Questions Conclusion Key Success Factors The Aritzia Advantage Competitive Advantage Overview Financials Marketing Conclusion • Product variety relative to the retail clothing market in Saskatoon • Product availability • Expressing fashion beyond simply clothing; linking fashion to culture • Friendly, fastidious and fashionable staff • Proven sales • Growing retail market in Saskatoon • Vertical integration • Brand recognition • Management Operations Questions Questions? Overview Financials Marketing Conclusion Operations Questions
