Shoes4U.com is being organized as a global Internet shoe store that
is focused on reducing the overall price structure, in addition to enabling
customers to make knowledgeable decisions about footwear
purchased.Shoes4U.com will also attain a competitive edge by offering
services such as website development and e-commerce, which have become
essential for any business presence. Shoes4U.com intends to establish and
operate an Internet shoe store with services costing significantly less
than the prices of its competitors, while supplying superior quality.
Eight equal partners will manage Shoes4U.com, and will each supervise
different areas of the business. The partners will create an environment
and structure that will encourage productivity and respect for customers
and fellow employees. All wages and salaries are based on the position and
full time/part-time status.
Shoes4U.com is targeting individuals between 18 and 40 years of age.Order now
The organization is planning on targeting these individuals through various
marketing tools, with the main tool being direct e-mail promotions that
offer substantial savings on products purchased. The major themes behind
our different sales pitches to our potential and existing customers will be
the significant cost savings, convenience, streamlined fulfillment process,
broad range of services and products, and comprehensive customer service
that Shoes4U.com provides.
Shoes4U.com has four major competitors online. Shoes4u.com realizes
that it must also compete with physical discount retail stores. In order to
remain competitive Shoes4U.com has analyzed their advantages and taken
steps to use those advantages to maximize their opportunities in the shoe
Shoes4U.com offers many services and products. Some of the services
that Shoes4U.com offers includes order tracking and review 24 hrs a day, 72
hr delivery, and a 100% satisfaction guarantee program. Some of the
products that the business offers are slippers, boots, sandals, casual
wear, corporate casual wear, and dress shoes.
Shoes4U.com plans to continually expand its business through many
ways. Some of theses ways include creating new services, building brand
recognition, acquiring strategic alliances with major shoe companies and
distributors, etc. Shoes4U.com will also expand by leveraging and
extending technology and initiating several sales programs. While expanding
the business will simultaneously be combating the following challenges:
intensive customer interaction, flexible pricing, intelligent order
routing, and re-orders.
Company Mission Statement and Description
Shoes4U.com will develop a unique website that provides customers various
ways to buy designer shoes and boots of all types and sizes. The company
plans to register a corporation under the name of Shoes4U.com and operate
under the same name.
We at Shoes4U.com provide designer shoes. Through our on-line retail
operation we guarantee the best prices, the highest quality, the widest
selection and the quickest delivery utilizing the power of the Internet to
become the market leader in providing convenience and selection to
Our goal is to become the #1 on-line shoe retailer. By providing a
convenient way for customers to purchase the designer shoes that they love,
need, and want, we offer low prices with high variety. What makes
Shoes4U.com unique is the ability to capture the needs of customers.
Customers will be able to log on to the site, type the brand, size, and
color of the shoe they prefer and a 3D image will appear. Factors for
growth are downsizing in large retail companies, a growing trend towards on-
line purchasing, and society is moving towards a more technically oriented
trend where every home has a computer with Internet access.
The company’s management philosophy will be based on responsibility and
mutual respect. Shoes4U.com will maintain an environment and structure that
will encourage productivity and respect for customers and fellow employees.
Additionally, the environment will encourage employees to have fun by
allowing creative independence and providing challenges that are realistic
Shoes4U.com is a private partnership with eight partners of equal
liability. Each partner has different duties and responsibilities.
Company Director – Racquel Richards – Overseas the general operation and
interrelation of each division.
Company Administrators – Gabrielle Mitchell, Danielle Smiley – Overseas
operations within the corporate headquarters, including answering
telephones, tracking orders, and general customer service.
Creative Consultant – Deidre Melton – Overseas advertising and promotions.
Director of Supply Chain – Thomas Duncan II – Overseas supply relationships
and procures financial resources.
Director of Marketing – Errol Allen II – Overseas customer relations and
Director of Information Technology – Marvin Cole – Maintains website and
researches new technologies applicable to Shoes4U.com.
Director of Research and Development – Natasha Martin – Researches trends
and future markets and areas of growth.
Customer Service Representatives – Answers incoming customer calls and
responds to customer concerns.
Distribution Specialists – Package orders for customer delivery
Recruitment of Employees
In the event that employees will need to be hired services will be
purchased from a local employment agency.
Salaries and Benefits
All customer service representatives will be paid minimum wage and will
only receive medical benefits if they work an average of 40 hours a week.
All partners will be paid an equal wage determined by how much profit is
retained from operations after all costs have been rendered and liabilities
have been covered. All workers will be covered by Worker’s Compensation.
All full time employees are eligible for one week’s paid vacation after one
year of employment.
The company projects that between July 1, 2002 and December 31, 2002 it
will generate revenues of $250,000. Projected revenues for 2003 and 2004
are $2.91 million and $5.82 million, respectively. Shoes4U.com is seeking
$5 million in venture capital to be used for:
1. Establishing an organization and office presence in Florida.
2. Completing development of the Internet shoe store.
3. Marketing the website and its services and products.
The Market and Customer
Shoes4U.com is focusing on individuals 18 years of age and older. During
the ages of 18 to 40, these individuals are the trendsetters for society
and the #1 users of the Internet (Appendix 1). Also, the average household
income for this group is between $50,000 and $74,000 a year (Appendix 2).
Shoes4U.com plans to aggressively pursue and acquire customers through
promotions and convert them into repeat paying customers. Direct email
promotions are the most important vehicle that the company will use to
acquire customers. These promotions may include charging the customer only
for the product but no shipping and handling, in order to introduce that
customer to our products and services. Shoes4U.com plans to expand its
business and customer base by offering promotions on a continuous basis.
Shoes4U.com will continually strive to provide consumers with more cost-
effective avenues, offering substantial savings rather than just a few
Customer Buying Criteria
The traditional process of purchasing footwear can be long and tiring.
Therefore Shoes4U.com believes that consumers will choose products and
services based on the following criteria:
. Significant cost savings. The shoe store will operate online and will
be highly automated, enabling Shoes4U.com to eliminate the costs of
both building/managing a physical shoe store and
manufacturing/distributing catalogs. We will be able to pass these
savings on to our customers, offering goods for up to 50% less
than traditional shoe shops. Furthermore, it is believed that our
prices will be competitive and could possibly undercut mail-order
catalog prices, but have a superior offering of customized products.
Traditionally, the primary cost of retailing has been salaries and
wages as well as inventory. By only keeping an emergency stash of
inventory on our own and outsourcing shipping to FedEx, we cut down
the inventory cost as well as eliminate the overhead associated with
either catalog or physical selling.
. Convenience. Shoes4U.com will develop its online shoe store and
specialized services to be user friendly, using a self-service
approach to ordering products. Products will be shipped to the
location the customer selects, enabling the entire process to be
managed from the comfort of the customers office or home.
. Streamlined fulfillment process. After an order is placed, Shoes4U.com
will electronically send a ready-to- graphic file. Where appropriate,
a job ticket file, which is a data file containing all of the
attributes of an order, will be sent, first to the company database,
then to one of the company’s distribution partners and FedEx.
. Broad range of services products. Shoes4U.com will provide a one-stop
shop for a wide range of products and services, with a shoe selection
that the company believes is superior to most traditional shoe stores
and shoe catalogs. Customers will be able to view and compare products
and either immediately place their order or save their work-in-
progress to order at a later date.
. Comprehensive customer service. Shoes4U.com will offer a broad range
of customer services during all phases of the ordering and fulfillment
process. After each order is placed, an email message will be
automatically generated to the customer that itemizes the order, the
total cost, and reiterates the estimated delivery time. The company
will electronically receive order confirmation, and delivery
information from its partner distributors and make this information
accessible to customers through a password-protected mechanism,
enabling the customer to easily check an order’s status online or even
cancel the order if it has not yet been shipped. An additional email
will also be sent once the customer’s order is shipped.
The explosive growth of the Internet as a tool for global communications
has enabled millions of people to interact electronically. The IDC
estimates that there were 142 million Web users worldwide at the end of
1998, and expect this number will grow to approximately 502 million by the
end of 2003. Rapid acceptance of the Internet as a communications platform,
by both businesses and consumers, has created the foundation for
significant growth in business-to-business (B2B) and business-to-consumer
(B2C) e-commerce. IDC estimates that worldwide commerce over the Internet
will increase from approximately $50 billion in 1998 to $1.3 trillion in
Small businesses are taking advantage of the opportunities the Internet
offers. The IDC estimates that the number of small businesses engaged in e-
commerce will increase 47.1% annually, from 400,000 at the end of 1998 to
almost 2.8 million at the end of 2003, signaling the broad adoption of the
Internet by these small enterprises.
The widespread adoption of the Internet as a purchasing vehicle has created
a wealth of opportunities for businesses that offer products and services
to consumers. Simultaneously, it has given both small businesses and
consumers a wider variety of products from which to choose at competitive
Internet selling is going to continue to move forward at soaring rate,
partly due to advances in technology. Methods of providing forgery-proof
identification for on-line consumers have improved greatly in recent years.
Technology for making purchases over the Net, even small purchases that
total to only a few cents, has improved due to payment systems initiated by
CyberCash of Reston, Virginia. Major, traditional retail merchants, even
those dominant in their store segments, are investing heavily in new
websites. Selling on-line is no longer a unique or futuristic thought. It
is now a vibrant mode of alternative selling that is rocketing ahead at a
rate so fast that no one can keep up with it.
The research shows that e-marketplaces will be responsible for 53% of all
online trade. Research also indicates that more companies are moving to
make purchases and sales on the Internet and are looking to build deeper
relationships with business partners. This research has also shown:
. Industry inefficiencies run rampant. In today’s business environment,
comparing offerings across suppliers requires multiple phone calls to
various suppliers or enlisting the costly support of a broker. Time-
consuming practices like these are easy targets for the Net, where
purchasing agents can gain instant access to comparisons of many
. E-marketplace vendors will lower technology barriers. Today, B2B
entrepreneurs can acquire sophisticated marketplace software from
firms like Tradex, Ariba, and Commerce One, or entirely offload the
building of their websites to a lengthening list of experienced e-
commerce integrators like Vision Systems or Software Solutions
Shoes4U.com will ensure our success by combining the most functionally rich
site with the best prices for our customers. Shoes4U.com will aggressively
pursue partnerships and develop a large customer base to get a strong
foothold in the markets it ventures into. New vertical e-marketplace rules
will emerge. As the competition increases in these vertical e-marketplaces,
the operators will have to update their strategies and change their
Our major competitors are www.footnotesonline.com, www.tonyshoes.com,
www.zappos.com, and www.designershoes.com. These online retail stores
offer the same products as Shoes4U.com. However, our prices, product
selection and delivery options are better than these other online shoe
retailers. Our potential competitors are physical discount retail stores,
such as DSW, SRI, K;G, and other outlet stores. Our competitive advantage
is convenience, 24-hour nation-wide availability, low operational costs
(i.e. inventory, storage, and fixed costs) and personalization. (Appendix
Products and Services
Shoes4U.com. The online shoe store will offer customers a one-stop shop for
addressing their footwear needs. Our online offerings are targeted to be
more convenient and cost-effective than competing alternatives provided
through traditional channels.
Shoes4U.com will simplify the shopping and ordering process in several
ways. Lower overhead costs due to the online nature and automation, and
will allow the company to be more cost effective than traditional retail
Shoes4U.com will allow customers to track their purchases from start to
finish. They will be able to view their selections online and make
modifications at any time; customers will have access to service 24 hours a
day, seven days a week. Most importantly, Shoes4U.com will provide our
customers exactly what they want or there will be no charge.
Shoes4U.com products and services will address the need for assisting
customers in obtaining their choice of boots, dress shoes, sandals and a
variety of other footwear needs.
The company’s product selection will not need a high initial investment. We
will deliver our products through FedEx who will then drop ship our
products directly to the customer.
Customers will be able to order online and will have access to a 1-800
number for customer inquiries (9a.m.-5p.m. Eastern Standard Time, Monday
through Friday). Upon ordering the order information will be stored in our
database. Where after the order information will be sent simultaneously to
both the supplier and the delivery agent FedEx to be delivered to the
customer within a 72-hour period.
In the event that a shoe is defective, you are not completely satisfied,
and the shoe has not been worn, the customer will have the option of
returning the product and receiving a replacement or an equal exchange.
Customers will be able to contact the company via the Internet through
Future Expansion Plans
Products that will be offered in the future include:
. Accessories (i.e. handbags, belts, hats)
. Physical Stores
. Expand Globally
Shoes4U.com will eventually provide franchising opportunities. As the need
for doing business in the information age evolves, so will we. The company
will provide resources for customers to remain on the cutting edge of
The objective of Shoes4U.com is to become the leading online shoe store. As
part of the ongoing strategy, the company plans to:
. Create New Services. Capitalize on being one of the first online shoe
stores to target our market by aggressively introducing new services,
products and promotions.
. Build brand recognition. Build brand recognition by promoting the
Shoes4U.com brand through diverse marketing channels, such as online
advertising, public relations, and guerilla marketing.
. Expand relationships. Expand the company’s marketing relationships by
aggressively developing new relationships with leading destination
websites and media companies. This will accelerate customer
acquisition and increase usage of our online shoe store.
. Build customer base. Build a customer base and stimulate repeat usage
by exposing customers to products and services that most closely meet
. Expand private-brand initiatives. Expand our company’s brand
initiatives by entering into new relationships with a variety of
companies to increase distribution and sales channels, and increase
the usage of services.
. Leverage and extend technology. Leverage and extend the company’s
technology platform by enhancing the functionality of the Shoes4U.com.
This will be done to improve order flow and reporting, expand service
offerings, facilitate more complete integration with vendors, expedite
payment processing, and improve the efficiency of the system.
Marketing and Sales
Shoes4U.com will strive to develop the most recognized and trusted brand
for designer shoe sales on the Internet. To expand our customer base and to
extend the image of the company, we plan to aggressively promote the
Shoes4U.com brand through a combination of online and traditional media
advertising, public relations and guerilla marketing. Shoes4U.com strives
to provide high fashion, trendy, quality shoes. The company also plans to
expand our affiliate and co-branded online website strategies through
agreements with a range of destination websites.
The company will be promoting Shoes4U.com over the Internet through:
. Banner ads
. Providing a small percentage of the sales made through websites that
list Shoes4U.com from which a customer makes a purchase.
Internet ads are an obvious choice because that is the nature of our
business. Marketing will also be done through national media such as
national newspapers and magazines. Newspaper and magazine ads will be used
since our target customers include people who read various publications.
Television ads will be used in certain markets, as Shoes4U.com will be
targeting large cities.
The company’s sales strategy will be relatively minimal since Shoes4U.com
is offering solid durable goods. It is expected that the company’s
marketing efforts will bring customers to the website, and the benefits of
convenience, and low price as advertised on the website will be the
incentives to close a sale. Promotions and add-on products coupled with
continuing low prices will create repeat business.
The company has strategic alliances with major shoe companies, major
distributors, software developers, and athletes/spokespeople. These
alliances are valuable to us because they will allow the company to utilize
the knowledge and resources of these firms with no additional cost to the
business. Shoes4U.com plans to also form strategic alliances with search
engines such as Yahoo! and Lycos to promote the website, as well as
exploring the possibility of forming strategic partnerships with content
providers such as America Online.
The company also plans to pursue strategic relationships with leading
destination websites and media companies in order to increase traffic to
its website. By aggressively pursuing new relationships, we believe we can
accelerate the acquisition of new customers and increase usage of our
Shoes4U.com will also have strategic relationships with other e-tailers to
facilitate sales programs and promotions.
E-Coupons – coupons will have a unique identification number to control
redemptions. When customers place an order, their e-mail address will be
stored in the company database and will qualify them for future promotions
Rebate Program – for every 9 pairs of shoes a customer buys, they will
receive a $100 electronic rebate.
Allied Links Program – when customers purchase $1000 or more worth of
items, they will receive $100 of e-bucks for one of Shoes4U.com’s retail
Shoes4U.com has principal offices located in Tallahassee, FL. All
operations, from administration to website development, will take place at
this leased office location of approximately 12,000 square feet.
The customer will place an order. The order information will go to
Shoe4U.com database. The order information will be sent to the U.S. based
distributor. Te order will then be processed and sent back to the
Shoes4U.com warehouse, also located at the headquarters. From there, orders
will be delivered via FedEx. This whole process occurs within three days. A
supply chain layout is found in the appendix (Appendix 4).
An online shoe store faces challenges that other electronic commerce
vendors do not face. Shoes4U.com will structure its online shoe store to
address the challenges of selling a product that has an intrinsic personal
value. Shoes vary in fit, which makes the process of trying on shoes an
integral part of overall shopping process. The computer software
architecture of Shoes4U.com, the related websites, and the order processing
technologies integrate high-performance and proprietary software modules
with technology that is licensed from third parties.
The challenges for an online shoe store which are not typically faced by
other electronic commerce vendors include:
1. Intensive customer interaction. Our websites are not presenting static
content pages; customers are engaged in price and selection shopping
which require constant system monitoring and optimization as visitor
2. Flexible pricing. An intelligent agent will be used in order to check
the prices of similar priced merchandise on a variety of sites in
order to ensure our continued leadership as the price leaders in the
3. Intelligent order routing. Each of the shoe wholesalers the company
will work with has different capabilities and a unique set of
requirements that are taken into account when determining how to
fulfill an order. By considering account product type, pricing,
geography, and shipping options, Shoes4U.com will strive to route each
order individually to the vendor with the best combination of quality,
delivery time, and price.
4. Re-orders. Shoes4U.com will retain each customers order
specifications, including personal and shipping information for a
limited time. We will not sell this to any related third parties.
Shoes4U.com believes that, with our technology expertise, we will be
able to address these challenges while also handling large numbers of
customer orders. We feel this represents a competitive advantage.
The software that supports the online shoe store is a collection of
integrated software modules that will enable Shoes4U.com to quickly create,
maintain, modify, or replace individual components. Shoes4U.com will create
its proprietary software modules using development and technical standards
and practices, and without significant dependencies on specific operating
systems, databases, or Web server technologies. As a result, the company
will be able to move portions of its software between different databases,
operating systems, and Web server products to upgrade capacity or take
advantage of price or performance improvements, as they become available.
The following is a description of the key software modules that will
be found on the Shoes4U.com website:
1. 3-D Workshop. This will allow customers to view the shoes from a
variety of angles and to take a virtual tour of the shoe components
with a related explanation of each part of the shoe and why that shoe
is of superior quality.
2. Product and Pricing Engines. Our various engines will contain a wide
range of product s, features, and pricing information. To support the
broad array of product variations and customization options offered,
we will these databases to be highly flexible. This will allow us to
modify our records as the market dictates.
3. Secure Shopping Cart. We will provide a customized order basket to
store and securely process orders. The Secure Shopping Cart will be
integrated with the systems of members, thus reducing the need for
human intervention in order to produce and complete an order. The
company believes that by organizing the system in this manner, the
order and completion process will be vastly more efficient and are
less error prone than current processes.
4. System Reporting and Diagnostics. This program is ed to track customer
action on participating websites. Shoes4U.com will utilize this
program in order to remain aware of industry and retail trends.
System Standards and Integration
Shoes4U.com will offer the following standards:
. High-speed operation.
. Optimized screens incorporating data from several modules on a single
. Great depth to handle the most sophisticated requirements.
. Tightly integrated standards to minimize errors, data entry, and time,
and maximize the speed and information content on displays and outs.
. Consistent look and feel, uniform prompts and similar data flow for
. User-friendly. Rich in useful features such as help displays, pick
boxes, numerous user-changeable flags and user-modified options.
Depth and Integration
Shoes4U.com will have depth, which means that the software will allow the
customer to go beyond the basics. Depth will apply to each module
individually: estimating, cost collection, and accounting. Software without
depth is limited and can be frustrating to a consumer.
The company will have the ability to confirm customer information when
processing an estimate. We will also be able to route order to wholesaler
and automatically allocate inventory, verify credit limits, allow for
coverage, and put all outside buys on a ‘must buy’ list for purchasing and
updating work-in-process. When an order is taken and the customer is
billed, all information will be fully automatic. We will have depth in
accounting. This implies the following:
. A job scan will be pre-billed or partially billed.
. The sales tax will be computed for all states taxes, including any
county or local tax.
. More than one accounting period can be open at the same time.
. Allowing several bank accounts and classes of Accounts Receivable to
automatically compute and track sales commissions and multiple plants
with individual and consolidated financial statements.
Financial Projections and Plans
Funding Requirements and Uses
The company will be raising $5 million for the purposes of:
. Establishing an organization and office presence within the USA and
. Completing the development of the Internet shoe store.
. Marketing the website and its services and products.
. Providing a world-class customer service website.
The table in Appendix 5 provides a breakdown of how the funds will be used.
Nature and Limitation of Projections.
This financial projection is based on sales volume at the levels described
in the revenue section and presents, to the best of managements knowledge
and belief, the company’s expected assets, liabilities, capital, revenues,
and expenses. The projections reflect management’s judgment of the expected
conditions and its expected course of action given the hypothetical
Nature of Operations. The company operates as a Florida LLP.
Revenues. Shoes4U.com will generate revenues from the sale of a variety of
products to customers. The company’s products and services will be
available to customers through the Shoes4U.com website.
The company will not recognize revenues until the product is shipped,
collection of the receivable will be probable, and partner distributors
have fulfilled all contractual obligations to the customer. Shoes4U.com
will take title to all products that the company instructs its partner
distributors to produce. Shoes4U.com believes that purchases by businesses
will account for a majority of its revenues and will record sales net of
discounts. The company will record the cost of promotional products that it
will give away at no charge as a sales and marketing expense (Appendix 6).
Appendix items 7 through 12 give a more in depth depiction of Shoes4U.com
Shoes4U.com currently has no operating history, which makes it difficult to
forecast future operating results. The company will encounter risks and
difficulties that start-ups frequently encounter in rapidly evolving and
competitive markets. These risks include expanding the number of certified
partner distributors and improving technological and logistical connections
to these vendors. If these risks are not addressed successfully, the
business will be seriously harmed.
Due to the nature of Internet business, the performance and fluctuations in
quarterly sales and operating expenses will depend on the current
marketplace and competition. The performance of Shoes4U.com will depend on
market and industry risk factors that the company recognizes it will be
subject to. The company’s view of its risks is as follows:
. Employee turnover. One of the biggest risks that all dot-com companies
face today is the loss of key personnel. Shoes4U.com will minimize
this risk by ensuring that our employees have a world-class working
environment, which includes being paid competitive wages, excellent
benefits, and stock options.
. Competitors. To mitigate this risk, we will closely monitor our
competitors pricing structures, business strategies, and overall
customer satisfaction to make sure we are one step ahead at all times.
. Economic Factors. To minimize this risk, we will diversify our
position in the products and services that we offer, as well as
planning to ensure there is always enough liquid assets and resources
in case the economy begins to show negative trends.
. Customer retention. The company will aggressively advertise its
products and services and establish strategic alliances with industry
leaders in order to generate a solid customer base and retain
. Downtime. Technical difficulties, system failures, or Internet
. Timing. The timing of large customer orders, or the failure to enter
into strategic alliances.
. Costs. The amount and timing of operating costs and capital
expenditures relating to expansion of the business, operations, and
. Pricing. Changes in our pricing policies or competitors’ pricing
The success of Shoes4U.com will depend on a significant number of buying
customers knowing about, and regularly using, our services. The market for
Internet-enabled shoe stores is at an early stage of development. Many
customers will be addressing issues such as quality, reliability, billing,
delivery, and customer service for the first time in a self-service,
Internet-based, creation and ordering environment (w/ regard to shoes).
Educating potential customers is a complex, time consuming and expensive
process. In many cases, organizations must change established business
practices and conduct business in new ways to use the services.
We predict that Shoes4U will evolve into a very profitable company.
It will prove to be a lucrative venture for any investor. Low cost combined
with high quality products and efficiency is the equation for our
companies’ success. We believe that although our company will profit little
in the first year, revenue will be doubled by the second year and
experience a continuous growth. We have strategically placed our company in
an e-commerce market in order to prevent barriers to entry and high start
up costs. We also evade the risks of long-term debt and bankruptcy by
choosing not to borrow money. We believe in Shoes4U and you should too!
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