Assignment 2written business plan

Sebastian Norton and Aaron PhilippMAA103

Accounting for Decision Making

MAY 5, 2016

Table of Contents

Executive Summary 3

Background 4

Business Description 4

Business Strategy 4

Ownership and Legal Structure 4

Marketing 5

Products Offered 5

Target Market, Customer Demographics and Competitors 5

Industry Characteristics 6

Promotion and Advertising 6

Operations 7

Organisational Structure and Staffing 7

Regulation Considerations 7

Professional Advisers 7

Business Premises 8

Workshop and Equipment Required 8

Retail Process 8

Key Sustainability Considerations 9

Financial Projections 10

Assumptions 10

Start-Up Costs 11

Calculation of Expenses 11

CVP Analysis and Pricing Structure 12

Sales Forecasts 15

Cash Budget Considerations 15

Distribution of Profits 18

Funding Needs 18

Implementation Table 19

Concluding Statements 20

Reference List 21

Executive summary

Easey Tees is a community-focused clothing brand selling screen-printed t-shirts where the designs are created by local Melbourne artists, who receive a commission for each shirt sold.

The main business goal is to secure a net profit of $180,000 after the first year of trading.

Our core marketing strategy is targeting socially-aware, community focused individuals who are interested in an aesthetically appealing clothing at an affordable price. We aim to appeal to people’s intrinsic desire to contribute within their society, combining organic materials, commissions for local artists, and cheap prices to fill a niche in the market. We will use radio and Facebook advertising to advertise our business.

The store, located on Easey Street, will be open during normal retail hours, 7 days a week. There will be a full-time salaried manager supervising operations along with the owner, Sebastian. Shirt screen printing will be completed by the other owner Aaron, in the workshop attached to the store. Casual staff will be hired to cover a total of 60 work hours per week. Accounting, marketing and most other business activities (with the exception of legal matters) will be managed in-house to minimise cost. Our sustainable ethos will be echoed in our operations with concerns to waste management and renewable energy.

Financial forecasts for Easey Tees look extremely robust. The projected 12-month net profit of $182,205 exceeds our business objective, and our break-even point of 9,385 units its less than half of our projections, indicating that the business will be resilient to unforeseen adversities. Utilising a small line of credit for financing the business start-up, cash-flow forecasts are strongly positive for the entire financial year, and credit terms with suppliers enhance this further.

1. Background

1.1 Business Description

The business consists of an attached workshop and shopfront, whereby plain shirts are purchased from a supplier, then the designs are printed on the shirts in our workshop. Shirts are then tagged, and sold to the public in our store in the Inner-Northern area of Melbourne. The designs for the shirts come from original submissions made by artists. The selection process is discussed in the Marketing section of this business plan.

The store name is derived from the street on which it is located – Easey Street in Collingwood. The name generates and element of familiarity with the iconic street name, and relates to the age-old expression “Easy Street” being both meaningful and catchy.

1.2 Business Strategy

Our primary business focus and strategy is to stand out - in a market saturated with overpriced, tasteless and meaningless designer clothing, we want to provide a product that looks better, feels better, and improves the community we live in, all at an affordable price. We will be priced significantly cheaper than other designer clothing, and have far superior quality to cheap, mass-produced clothing found in outlets.

1.3 Ownership and Legal Structure

The legal structure chosen for our business is a partnership. Given the fact the owners, Aaron and Sebastian, each contribute to the day-to-day operation of the business, the partnership was chosen primarily as a means to ensure that both parties are motivated to contribute to the success of the business. Furthermore, given the small nature of the business, this will reduce the fees and work involved in establishing the business, while still making it easy to change the legal structure if circumstances were to change (Department of State Growth Tasmania, 2016).

2. Marketing

2.1 Products Offered

Our line will consist of 2 different styles – an Organic Cotton 150 grams/sqm pre-shrunk tee, and an Organic Cotton 150grams/sqm pre-shrunk long sleeve tee. The shirts will be purchased in a range of colours, although the bulk of the base t-shirts will be black and white.

We will have both women’s and men’s sizes available ranging from XS-3XL. T-shirts and long-sleeves will be purchased from 2 different suppliers, to mitigate the impact of a compromised relationship with one of our suppliers. We will have a third supplier for the printing materials.

Competitions will be held to attract artist designs to be printed on the tees. The submissions will be judged by Aaron and Sebastian. They will be chosen based on internal selection criteria.

The artists, if successful in their entries, will receive a set amount of $5 for each and every one of their designs sold. At the end of each month, the most popular designs may be chosen to remain in store. Otherwise, new designs will be introduced and printed. There will be 5-10 different designs available at any given time (depending on the quality of artists’ submissions). These designs will rotate monthly.

2.2 Target Market, Customer Demographics, and Competitors

Our target market is socially aware 18 to 39 year olds who live within the Melbourne CBD and inner suburbs. We are aiming at customers with enough disposable income to justify paying a very small premium in exchange for appealing, unique and interesting apparel at a less-than-designer price. Furthermore, we aim to attract community-focused individuals who will be drawn by our focus on organic and sustainable materials, as well as our support and funding for community artists to earn a living from their work.

We believe we can effectively occupy a niche in the market, but will still have competition from other lower-priced retail outlet stores in our area. Although they will attract more price-focused, low disposable income customers, this may still effect our walk-in sales.

2.3 Industry Characteristics

Clothing retailing is a $19 billion per year industry in Australia, showing continuing growth of over 3% per annum. Victoria, specifically metro Melbourne, has an extremely high average income, giving way to high consumer purchasing power and making it an attractive market despite having intense competition from over 10,000 retail businesses in Australia (IBIS World, 2016).

The clothing retail industry is a fickle one, affected by trends such as seasonality, and other unforeseen changes in consumer taste. Customer spending on clothing is also closely related to the performance of the overall economy, as seen by the effects of the Global Financial Crisis in 2007-2008, even though this had a lesser impact in Australia (McKenzie, 2010).

Finally, there has been a recent increase in the arrival of foreign fashion giants such as H&M and Uniqlo entering the Australian retail market. The impact of these brands opening physical stores is huge, especially considering their online presence alone can take away as much as a million dollars in sales a day from the local industry (Hoy, 2014).

2.4 Promotion and Advertising

Our promotion and advertising will be focused around the core values of our brand, and seek to side-step many of the industry issues discussed above.

The promotion for the brand launch will be in two primary forms: Facebook competition pre-launch to attract artists to design prints for the tees, to be

available upon the store opening. Supplementary radio campaign of paid ads through PBS FM (a community station also located

on Easey Street)

After the business launch, paid targeted Facebook ads and radio ads will continue at a lesser frequency to attract a constant stream of new customers.

3. Operations 3.1 Organisational Structure and Staffing

The store will be open from 9am-6pm, 7 days a week. We want at least 2 staff present at any given time (excluding weekday mornings). This is a total of approximately 100 staff hours per week.

We will hire one full-time manager, working 40 hours a week, and have 3 casual staff covering the other 60 hours. Sebastian will work as an in-store manager 2 days a week as part of his commitment to the business. Staff will be recruited through online advertising.

3.2 Regulation Considerations

Our lawyer will aid us in creating employment contracts, as our knowledge of the Fair Work Act 2009 is lacking, and we want our employees to work in a fair and safe environment.

Employees training will include learning about Australian Consumer Law, as part of the Competition and Consumer Law Act 2010, to reduce any incidences of misleading conduct, and better our staff’s ability to handle complaints.

We will also have a lawyer frame a legal contract stating our 50/50 ownership of the business, and we have pledged to contribute an average of at least 20 hours per week to the business, ensuring that we adhere to the Partnership Act 1898.

3.3 Professional Advisers

As mentioned above, we will pay for a legal adviser to assist in starting our business, and also employ his services throughout the initial 12 months of operation as we develop and systematise our operating procedures.

Sebastian’s previous work in retail management and accounting knowledge will deem him responsible for analytics and bookkeeping. Aaron’s marketing and print-making knowledge will keep those areas in-house too – the lawyer will be the only paid outsourced professional adviser.

3.4 Business Premises

Our store location will be 2 Easey St, Collingwood. It is positioned in a high density retail area, which will give a large amount of foot traffic every day. It is a central location, less than 3km from the CBD, and is easily accessible via public transport being walking distance from Victoria Park train station, and the adjacent Smith Street tram.

The street also holds the community radio station PBS FM headquarters; whose primary audience consists of Inner-Northern Melbourners. The street name is iconic, links to our brand name, and furthers our aim to be intertwined with the local community.

The shop will have an industrial, yet trendy look, with concrete floors, exposed red brick and high ceilings.

The property itself will be leased.

3.5 Workshop and Equipment Required

There will be an attached workshop in the premises, where stock will be held and designs will be printed on the shirts. This will consist of a high-end computer, t-shirt printing machine, storage, and work-furniture. Aaron will operate this when new designs are chosen, in batches. One of the staff will also be trained to use the simple set of equipment in the case of higher demand, or if Aaron is not available. The stock room will also hold the excess stock when ordered from the supplier.

3.6 Retail Process

The customer will enter the store via our double doors. They can use our changing rooms to try on the product, or simply just purchase a new colour or design if they are a past customer that knows their size. They will be attended to by our friendly staff if they need any assistance, and the sale will take place at the counter. There will be a computer and POS system to process sales, check stock levels, and give the customer information on the artists and future products. The artists’ who design the prints will have their information available at the counter, to promote the purchase of their works in the future.

3.7 Key Sustainability Considerations

Sustainability is at the core of Easey Street’s business culture and strategy.

Environmental Considerations:

Organic cotton is the selected textile. This means less chemicals used in the manufacturing process and a lower ecological footprint.

We will actively engage in recycling and waste reduction in our workplace. We will use Momentum Energy (a renewable energy provider) as our utility supplier, to

reduce our carbon footprint.

For our economic and social considerations, the very fabric of our store is our community focus. We will be supplying income for Australian local artists and hiring local employees. Our store will act as a hub for community-minded individuals to gather and we will try and show the value of buying local, sustainable products to customers who otherwise wouldn’t have exposure to this, creating an impact beyond the bounds of our own store sales.

4. Financial Projections

4.1 Financial Forecasts and Budgets

In assessing sales and cost of sales projections, we are using a combination of data from previous experience and market research, undertaken in the two forms: discussions with local business owners, and a survey of 200 shoppers in the area adjacent to our business location.

4.1.1 Assumptions

Sebastian’s previous retail experience in clothing stores of varying sizes and products allows for reasonable estimation of store sales. The foot traffic at the new business is significantly less than his previous store (less than 20%) but we estimate that with the unique nature of our product, as well as its significantly lower than average price, we will be able to still attract steady business. We have estimated the average potential number of sales at 10% of Sebastian’s previous workplace; a potential underestimation based on comparative foot traffic and lower price point, yet factoring in the unique/non-mainstream nature of the product.

We expect the average customer having about a 50% chance of buying more than 1 shirt. The product is well-priced, and the range of colours and designs tend toward buying multiple items. This figure is also aligned with our market research, where around 50% of customers said they normally purchase more than 1 item per shop.

We spoke to a local retail business owner, in an area with similar activity, and he estimates approximately 15-20 customers per hour enter his store.

Using the figure of 16 per hour, we hope that with our unique products, we will convert 25% of customers that visit the store, producing approximately 4 sales per hour.

Using an average of 1.5 units sold per transaction, this would equate to 6 units sold per hour. Over a 9-hour day, this estimates 54 units sold per day, 1,642 units per month, or 19,710 units per year.

As part of our market research survey, we asked what proportion of customers would buy either a T shirt or a long sleeve if given the choice – 80% of consumers told us they would choose the t-shirt. We used this as the basis to our estimated sales mix.

We estimate that each casual employee will sell approximately 1 unit every twelve minutes, and either the salaried manager or Sebastian will make up the rest of the sales. Our staff numbers will increase or decrease depending on the time of year, and how busy the store is. We will pay our casual employees $26/hour (superannuation included). Thus, the portion of variable cost per unit from

casual wages will average $5.20/unit. The manager’s salary is fixed for the year, so is instead included with fixed costs. 4.1.2 Start-Up Costs

A summary of start-up costs is shown below. The majority of costs will be paid for in the month of July. The total cost of $62,765 requires financing, as the owners are investing no capital of their own. The financing information for Easey Tees can be found in Section 4.3.

SUMMARY OF START UP COSTS Cost ($)Advanced Rent and Bond 16,000 Advertising 2,150 Business Registration 381 Legal Fees 1,300 Loan Servicing Fee 500 Pre-Launch Stock 15,434 Renovations 5,000 Shop Fittings and Furniture 6,000 Workshop Equipment 16,000 Total Start-Up Costs 62,765

4.1.3 Calculation of Expenses

No prearrangements have been organised to account inflation or increases in costs. However, quarterly reviews of operation processes and sales results will be used to make adjustments if and when necessary. A new marketing strategy and business plan will be prepared for the next financial year – details can be found in the Implementation Schedule.

Depreciation has been calculated using the Prime Cost method. Useful life information has been acquired from the Australian Taxation Office (2015) Taxation Ruling document.

4.1.4 Cost-Volume-Profit Analysis and Pricing Structure

Part of Easey’s core methodology is selling a superior product at a price not akin to a normal “designer” shirt price – instead having a cost around the same that you could expect at an outlet store.

However, as discussed earlier in this business plan, Easey Tees has high goals for 12-month profits. We are aiming for a profit of at least $180,000 over the first year. This is the performance indicator used by the owners to assess the business’ performance. For our purposes, we believe a sales price of $40 per shirt would adhere to our ethos. The following analysis will investigate the pricing viability.

Our CVP analysis involves the common assumptions that; our costs and revenue remain constant through our relevant range (12 months); all costs can be classified as either fixed or variable; only changes in activity affect costs; all produced goods are sold; the sales mix remains constant (Carey & Lombardi, 2016, p. 48).

Easey’s target profit can be used to determine whether our sales price is appropriate. Using the contribution margin technique, we can estimate the number of sales required to hit $180,000 in profit.

The below table shows components of variable cost per unit, weighted based on the sales mix for t-shirts and long sleeve shirts (80%/20%).

The above table shows calculations for break-even points in terms of units and dollar sales. It takes into account the weighted unit variable cost from the previous table. Although a break-even point is useful to know for our business, the purpose of this CVP analysis is to determine required sales to meet our profit goal, and whether the $40 price point is appropriate. We can use these figures to conduct a target profit analysis:

(Fixed Costs + Target Profit) ÷ (Contribution Margin per unit) = Required Sales in Units

VARIABLE COSTS Component Cost ($)T-Shirt Base T-shirt 9.00

Artist's Commission 5.00

Casual Wages 5.20

Screen Print Ink 1.00 Unit Variable Cost 20.20

Portion of Total Sales 0.80

Weighted Unit Variable Cost 16.16 Long Sleeve Shirt Base Long Sleeve Shirt 11.00

Artist's Commission 5.00

Casual Wages 5.20

Screen Print Ink 1.00

Unit Variable Cost 22.80

Portion of Total Sales 0.20

Weighted Unit Variable Cost 4.56 Total Weighted Unit Variable Cost 20.72

CVP ANALYSIS Cost ($)Unit Selling Price 40.00 less: Weighted Unit Variable Cost 20.72 Contribution Margin per unit 19.28 Annual Fixed Costs (See Admin Budget - less Depreciation)

180,940

Break-Even Point (units) 9,385 Break-Even Point (sales) 375,394.19

(204,448 + 180,000) ÷ (19.28) = Required Sales in Units

Required Sales in Units = 18721

Our estimated 12 months’ sales equals 19,710 units, thus the required sales amount falls within our projections. The shows the $40 price point is appropriate. Furthermore, as seen in the calculations below, only 9,385 units need to be sold annually to break-even, creating a generous buffer in which sales could fall below projections and still generate a profit. This is further illustrated in the CVP graph in the section below, highlighted by a yellow wedge. The break-even point is shown where the total cost and sales lines intersect, and listed in the table above. The green horizontal and vertical lines show projected sales.

Break Even Point = Fixed Costs ÷ Contribution Margin

Break Even Point = 180940 ÷ 19.28

Break Even Point = 9385 units

4.1.5 Sales Forecasts

In total, sales are projected to reach 19,701 units in the first 12 months of operation. This equates to sales revenue of $788,040 for the year, or just over $65,000 per month.

We estimate that with our strong initial advertising campaign and the potential hype surrounding our launch, this level of sales will be attainable for the first quarter of operations. The next quarter, being over the holiday period (synonymous in retail with increased spending), should show a comparative increase in sales. Using knowledge of consumer trends from previous jobs, and information from the Australian Bureau of Statistics (2016), the decline in activity should begin in January and hold for the quarter, and generally rise again following the Easter period. This can be seen in our sales projections table on the following page.

Easey Tees projects a net income for every month of the year, with the exception of the first month of July 2016. This is to be expected of a new retail business, as start-up costs exceed $60,000. With our projected sales figures, this is turned around in the following month going from a loss of over $7,000 to a profit of over $17,000. Considering the year as a whole, we can assess the estimated net profit margin. Not only is the below figure an excellent return, we can also consider the total annual profit of $182,205 meeting and exceeding business goals.

Net profit margin % = (Net Profit) ÷ (Sales Turnover)

Net profit margin % = 182,205 ÷ 788,040

Net profit margin % = 23.1%

SALES PROJECTIONS Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 TOTAL

T-Shirts Sold 1314 1314 1314 1642 1642 1642 985 985 985 1314 1314 1314 15765

Selling Price 40 40 40 40 40 40 40 40 40 40 40 40 40

T-Shirts Sales Revenue 52,560 52,560 52,560 65,680 65,680 65,680 39,400 39,400 39,400 52,560 52,560 52,560 630600

Long Sleeve Shirts Sold 328 328 328 410 410 410 246 246 246 328 328 328 3936

Selling Price 40 40 40 40 40 40 40 40 40 40 40 40 40

Long Sleeve Shirts Sales Revenue 13,120 13,120 13,120 16,400 16,400 16,400 9,840 9,840 9,840 13,120 13,120 13,120 157440

TOTAL OVERALL SALES ($) 65,680 65,680 65,680 82,080 82,080 82,080 49,240 49,240 49,240 65,680 65,680 65,680 788040

4.1.6 Cash Budget Considerations

Given the nature of the business, sales will only take the form of cash collections at the point of sale. No lay-bys or credit will be offered. Thus, a schedule of expected collections has been omitted from this business plan as there will be no mismatch in timing between the sale and receipt of cash.

For inventory purchases, however, a schedule of expected payments will be considered.

With the exclusion of the first batch of stock received the month prior to the store opening (and paid in full the next month), purchase orders will be split over two payments. Half of the payment will take place in the same month of the goods being received, and the other 50% of the payment will occur the next month. This has been chosen over paying up-front and in full to maximise the time value of money for the business, and mitigates risk if the supplier fails to deliver the goods as promised.

The effect of this on the required cash flow is shown in the ‘Schedule of Expected Payments’ table in the appendices, but the final amounts for each month are shown in the Cash Budget below.

At the end of each month, Easey Tees aims to have 100% of the next month’s required stock on hand. The reason for this is to provide sufficient time for the shirts to have the designs screen printed and prepared for sale, as the shirt designs rotate monthly. Stock will be purchased in line with the estimated sales mix of 80% t-shirts and 20% long sleeve shirts.

As seen in our Cash Budget on the following page, there is a substantial estimated ending cash balance right from the first month through to the end of the financial year. The line of credit’s size was chosen to accommodate a larger-than-necessary cash surplus from the get go. Given the risk involved with opening a new business, this was chosen to ensure positive cash flow even if performance falls below projections.

CASH BUDGET Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17

Opening Cash Balance -

35,859

38,655

39,525

49,876

60,626

75,235

69,658

64,481

57,372

59,769

62,565

Add: Receipts

Cash Collections 65,680

65,680

65,680

82,080

82,080

82,080

49,240

49,240

49,240

65,680

65,680

65,680

Line of Credit 80,000

Total Cash Available 145,680

101,539

104,335

121,605

131,956

142,706

124,475

118,898

113,721

123,052

125,449

128,245

Less: Payments

Bond 8,000

Lease Payments 8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

Line of Credit Interest 182

182

182

182

182

182

182

182

182

182

182

182

Line of Credit Loan Amount Repayments

6,667

6,667

6,667

6,667

6,667

6,667

6,667

6,667

6,667

6,667

6,667

6,667

Payments for Purchases (see Schedule of Payments)

23,151

15,434

17,361

19,288

19,288

15,430

11,571

11,571

13,503

15,434

15,434

15,434

Selling Expenses 18,390

18,390

18,390

22,982

22,982

22,982

13,787

13,787

13,787

18,390

18,390

18,390

Administration Expenses (Less $120 Depreciation)

23,431

14,210

14,210

14,610

14,210

14,210

14,610

14,210

14,210

14,610

14,210

14,210

Shop Fittings & Furniture 6,000

Workshop Equipment 16,000

Total Payments 109,821

62,883

64,810

71,729

71,329

67,471

54,817

54,417

56,349

63,283

62,883

62,883

Ending Cash Balance $ 35,859 $ 38,655 $ 39,525 $ 49,876 $ 60,626 $ 75,235 $ 69,658 $64,481 $ 57,372 $ 59,769 $62,565 $ 65,362

4.2 Distribution of Profits

At the end of the financial year, business profits will be split between reimbursing the owners for the many hours input to the business, and investing in the expansion of the business for the next financial year. In this case, the net profit will be split in half. A quarter will go to each owner, Aaron and Sebastian, and the remaining half will be invested into developing online sales or a second shop, depending on demand.

4.3 Funding Needs

Finance for the business will come in the form of a Business Line of Credit supplied by the Commonwealth Bank. The line of credit will be organised a month before the launch, in case of any deposits needed for store fit-out and renovation.

This will be secured by a property that Aaron and Sebastian jointly own from a previous business venture. As a result, neither party need to invest a deposit or any of their own capital. The interest rate on the loan amount is 5% per annum, and attracts a one off $500 loan servicing fee.

Aaron and Sebastian plan to pay off the full $80,000 borrowed through the line of credit within 12 months, effectively splitting it into 12 equal repayments of $6849 (also accounting for interest). The minimum required payment (interest only) would be $182 per month, however this will only be the chosen option in the case of low sales performance affecting cash flow.

Although the loan size of $80,000 is greater than the start-up costs shown in Section 4.1.2, Easey Tee’s wanted a cash buffer to allow for unforeseen opportunities to be taken advantage of, or unforeseen shortfalls to be covered.

The funding is necessary as the business has significant start-up costs, and the owners wish to start the business without investing any of their own capital.

This particular financing method, along with choosing a lease over a shop purchase, was chosen to minimise the risk involved with starting a retail clothing store. Despite the strong projections for the business, it is a niche product being created, and it prudent to keep investment and financial commitment to a reasonable amount, to allow changes such as store location or product type to occur with ease.

Note: A statement of Financial Position has been omitted, as all the relevant information can be found in the other sections of the appendices, as well as in this report.

5. Implementation schedule

2016 May Apply for Business License and ABN

Open joint bank accountApply for business line of credit and bank accountsBegin facebook marketing for initial artists submissionsBegin recruitment process for manager and casual staffPlace order with supplier for stock

June Organise partnership, employment, and artist contracts with lawyerFinalise lease agreement for premisesOrganise insurance for new siteBegin refurbishment of premises and installation of equipmentPaid advertising and marketing for store opening begins via radio/onlineOfficial store openingEnter into contracts with artistsComplete production/printing of shirtsInterview candidates and make final decision on staffFinal decision on initial shirt designs

July On-site training of staffOfficial store opening

August Complete standard operating procedures for staffOctober Quarterly review of operations process and sales results

2017

Jan Quarterly review of operations process and sales resultsApril Quarterly review of operations process and sales results

Prepare Marketing Strategy and Business Plan for New Financial Year

June Begin rollout of 2017-2018FY business plan

6. Concluding Statements

Easey Tees is a novel business idea in a market awash with generic, bland competition. Despite the competitive and merciless nature of the retail clothing industry, we have created a business and a product that is distinctive, and provides a multi-faceted idea of value to the consumer: the product is low-cost, aesthetically appealing, and creates good in the community.

With an industry worth $19 billion a year in Australia, Easey Tees only needs to capture a fraction of a hundredth of a percent of the market to meet its sales goals.

As seen in the sales projections, it takes less than half of the annual sales projected to break-even. If the projected figures are achieved, the business will generate a profit over $180,000 in the first year. The business model allows for expansion in many ways; new products, new store locations, or online sales potential. It appeals to a young audience, giving it substantial longevity.

Furthermore, risk has been kept to an absolute minimum, with only a small debt required. The business is easy to manage due to its size, and has an emphasis on surplus cash availability.

With a sound organisational structure, marketing plan, and dedicated, passionate owners, Easey Tees has value beyond the projected profits. It has the ability to adapt, the ability to appeal to an audience of high worth, and most importantly, the ability to create true and meaningful value in what is perceived as a capitalist-driven industry. Easey Tees will be a small fish in a big pond, but the ripples it will create will spread and propel its success for the future.

7. References

Australian Bureau of Statistics 2015, Retail Trade, Australia, Feb 2016, cat. no. 8501.0, Australian Bureau of Statistics, retrieved April 29 2016, from <http://www.abs.gov.au/ausstats/abs@.nsf/exnote/8501.0>.

Australian Taxation Office 2015, Prime cost (straight line) and diminishing value methods, Australia, Jun 2015, Australian Taxation Office, retrieved April 29 2016, from <https://www.ato.gov.au/Business/Depreciation-and-capital-expenses-and-allowances/General-depreciation-rules---capital-allowances/Prime-cost-(straight-line)-and-diminishing-value-methods/>.

Australian Taxation Office 2015, Taxation Ruling 2015/2 , Australia, Jul 2015, Australian Taxation Office, retrieved April 29 2016, from <https://www.ato.gov.au/law/view/document?docid=%22TXR%2FTR20152%2FNAT%2FATO%2F00001%22

Business Tasmania 2016, Partnership – advantages and disadvantages, Australia, Feb 2016, Department of State Growth, retrieved April 29 2016, from <https://www.business.tas.gov.au/starting-a-business/starting-a-business-from-scratch/choosing-a-business-structure-intro/partnership-advantages-and-disadvantages>.

Carey, P & Lombardi, L 2016, Accounting for decision making, 2nd ed, John Wiley & Sons Australia Ltd, Milton.

Competition and Consumer Act 2010 (Cth) s 51

Fair Work Act 2009 (Cth)

Hoy, G 2014, 'Australian retailers struggle as foreign fashion chains enter the market to cash in on strong economy', ABC News, accessed May 1, 2016, from <http://www.abc.net.au/news/2014-09-10/retailers-struggle-foreign-fashion-chains-reach-australia/5735070>.

IBIS World, 2016, Clothing Retailing in Australia: Market Research Report, IBIS World, accessed May 1, 2016, from <http://www.ibisworld.com.au/industry/default.aspx?indid=407>.

McKenzie, M 2010, 'How has the global recession impacted on the Australian retail industry?', The Analyst Journal, accessed May 1, 2016, from <http://www.analystjournal.com/component/k2/item/1090-how-has-the-global-recession-impacted-on-the-australian-retail-industry?.html>.

Partnership Act 1958 (Vic)

Word Count (Including Headings and In-text Citations, Excluding References): 4394