Running Head: Urban Outfitters Continuing Case Study Part 2: Creating a Business 1

Urban Outfitters Continuing Case Study Part 2: Creating a Business Assignment #1 Vance A !ea Professor !i""ie !e#is$C%emons BUS 1&&'(ntroduction to Business October 2)* 2&11

Urban Outfitters Continuing Case Study Part 2: Creating a Business 1 (dentify at %east t+ree c+a%%enges #+en setting u, a business -.,%ain #+y t+ey are c+a%%enges /+ree im,ortant c+a%%enges faced #it+ setting u, a business is deciding on a %ocation* targeting t+e rig+t ,o,u%ation and ada,ting to t+e c+anging en0ironment in order to stay current #it+ ,roduct trends (n order to correct%y c+oose t+e best %ocation* business o#ners may +a0e to consider some factors and use a ,rocess of e%imination to meet t+e best course of action Pic1ing a

%ocation #+ere a business can successfu%%y succeed is a sing%e entity t+at business o#ners s+ou%d not o0er%oo1 A +ig+ traffic area #it+ ,edestrians may seem %i1e a c+oice for a business2 but it may im,ose a c+a%%enge if t+e ,roduct is not tai%ored to t+e demogra,+ics of t+e intended customers 3Business !ocation ,g 14 C%ear%y* #it+out ,%acing an im,ortant em,+asis on #+ere to ,ro,er%y ,%ace a business may be t+e 1ey to success or fai%ure /argeting t+e rig+t ,o,u%ation is a%so 0ita% #+en estab%is+ing a business 5+en se%%ing any ,roduct* it s+ou%d be directed to#ards an indi0idua%6s #ants* needs* and most im,ortant%y* desires (f t+e ,roduct is not a,,ea%ing to t+e audience* it #i%% not se%% Age s,ecific targeting is one #ay to narro# do#n t+e ,roduct or ty,es of ,roducts* #+ic+ t+e costumer #ou%d be interested in buying Ada,ting to t+e c+anging en0ironment in order to stay current #it+ ,roduct trends is anot+er essentia% 7ua%ity or concern t+at a business o#ner s+ou%d focus on /+e c+a%%enge in t+is is finding #+at ,roduct is most ,o,u%ar amongst t+e target audience Business o#ners must +a0e a %ong term 0ision for ,roducts t+at #i%% se%% before t+e c+ange of times or decide #+et+er or not to continue ,roduct %ines for t+e ne# generation 2 8efine #+at a 9nic+e: ,roduct is ;i0e at %east t+ree e.am,%es of nic+e ,roducts

Urban Outfitters Continuing Case Study Part 2: Creating a Business

<

A 9nic+e: ,roduct is defined as s,ecia%ty items designed to target and satisfy t+e needs of a s,ecific grou, of ,eo,%e #it+in a certain %ocation 3Hartman4 A%t+oug+ not im,ossib%e* most of t+ese ,roducts #i%% be difficu%t to find in ma=ority of t+e de,artment stores around t+e #or%d !et6s ta1e ;o%f* for instance S,ecu%ati0e%y s,ea1ing* it is be%ie0ed t+at >& to ?@A of +uman beings are rig+t +ands dominate and @ to <&A are %eft +and 3Scientific American4 ;o%f c%ubs designed for a %eft +anded ,erson is a ,rime e.am,%e of a nic+e ,roduct t+at #i%% benefit %eft +anded go%fers (t is designed to accommodate t+em to en=oy t+e game #it+out ad=usting to t+e 9norm:* #+ic+ is t+at of a rig+t +anded go%f c%ub A ne# and u,coming nic+e ,roduct t+at Pedigree +as introduced to t+e mar1et is 0egetarian dog food Odd as t+is may sound2 t+is com,any +as ta1en into consideration t+e %ifesty%e of a 0egetarian and de0e%o,ed a ,roduct t+at #ou%d a,,ea% to t+em 3Sangeet+a4 Since t+eir c+oice of food e.c%udes 3in most cases4 red meat* t+eir ,ets can no# mimic t+eir o#ners eating be+a0iors 5it+ t+is uni7ue ,roduct* bot+ o#ner and ,et can s+are and ada,t simi%ar be%iefs Anot+er nic+e ,roduct on t+e rise is t+e +ybrid 0e+ic%e (n today6s mar1et* #it+ t+e gas ,rices steadi%y rising* ,eo,%e +a0e to go to a%ternate means to tra0e% to =obs and ot+er im,ortant %ocations A 0ery ,o,u%ar +ybrid 0e+ic%e is t+e /oyota Prius On a0erage t+is car gets @@ mi to a ga%%on 3Hybrid Cars4* #+i%e non$+ybrid 0e+ic%es a0erage an estimated 22 to 2B mi ,er ga%%on 3CP; Buddy4 5it+ t+e steady rise in gas ,rices* t+is ne# +ybrid 0e+ic%e #ou%d be t+e best c+oice #+en %oo1ing at mi%es to ga%%on* +o#e0er* not e0eryone is #i%%ing to ,ay #+at t+is 0e+ic%e costs /+is 1ee,s t+e ,roduct narro#ed to a s,ecific grou, of buyers < -.,%ain #+y a nic+e com,any mig+t +a0e an ad0antage in a mar1et 5ou%d ,rice necessari%y be an ad0antageD -.,%ain #+y or #+y not

Urban Outfitters Continuing Case Study Part 2: Creating a Business Eic+e com,anies may +a0e an ad0antage in a mar1et because t+ey a%ready +a0e a

ca,tured audience t+at t+ey +a0e targeted for a s,ecific ,roduct or ,roducts /+at same ca,tured audience is ,er+a,s %oya% customers* es,ecia%%y if t+ey are satisfied #it+ t+e ,roduct and en=oy its use !ocation of t+e nic+e ,roduct a%so ,%ays a ro%e in t+is decision (n my o,inion* ,rice isn6t necessari%y an ad0antage for t+e ,urc+aser (f t+e ,roduct is a s,ecia%ty item geared to#ards a s,ecific audience* t+e ,rice #ou%d not be of great interest -it+er t+e customer #ants items t+at are e.c%usi0e or not 5+en you %o#er t+e ,rice of t+ings #+ere e0eryone can afford it* t+e ,roduct #ou%d not be 9s,ecia%: anymore ) (dentify and e.,%ain t+ree reasons #+y customers #ou%d ,ay more for e.c%usi0ity /+ree t+ings t+at a customer #ou%d ,ay more for its e.c%usi0ity are +ouses* 0e+ic%es* and c%ot+es A +ouse being tai%ored to t+e meet t+e fami%y6s need is one reason !ocation of t+e +ouse determines #+at ty,e of neig+bor+ood t+ey c+oose to reside in and nearby sc+oo%s and s+o,,ing districts ,%ay an im,ortant ro%e a%so Ve+ic%es #ou%d be an e.c%usi0e ,roduct because ,eo,%e #i%% ,ay more because of +istoric re%iabi%ity ;as mi%eage to t+e ga%%on and its features are anot+er reason #+y t+e buyer #ou%d be #i%%ing to ,ay more O0era%%* it #ou%d +a0e to accommodate t+e comfort %e0e% of t+e indi0idua% or fami%y /+e basic reasons #+y customers are #i%%ing to ,ay more for c%ot+ing ,roducts is because it +as demonstrated durabi%ity and ot+ers for t+e trend and sty%e of t+e ,resent time Again* demand for t+e ,roduct and t+e #i%%ingness to ,ay for t+e merc+andise #ou%d be t+e 1ey factor @ -.,%ain +o# nic+e ,%ayer 9c+i,s a#ay: at a %arger com,etitor6s base ;i0e t+ree e.am,%es of retai%ers #+o +a0e done t+is

Urban Outfitters Continuing Case Study Part 2: Creating a Business

Eic+e ,%ayer6s 9c+i, a#ay: at a %arger com,etitor6s base because #+i%e 1ee,ing t+e focus grou, on s,ecific items* t+ey t+en increase ,rofits and branc+ out to ot+er ,roduct 0enues or merge #it+ ot+er com,anies to ma1e t+eir ,roduct stronger (n ot+er #ords* t+e customer no#

ma1es t+e nic+e com,any t+eir main source for ,roducts instead of t+e a0erage stores /+ree retai%ers t+at +a0e successfu%%y accom,%is+ed t+is are Fuidsi* Bo#s n /ies com and Gumie" Fuidsi is #e%% 1no#n in t+e e commerce #or%d for o,erating 8ia,ers com 3Hartman4 (t is a ,o,u%ar #ebsite t+at su,,%ies assorted dia,ers and baby merc+andise to ,arents 3Hartman4 Com,etiti0e ,rices and +a0ing your ,roducts de%i0ered to your +ome #it+in t#o days or %ess is a ,referred met+od of sa0ing time and money ma1ing it 0ery con0enient Eo# t+at t+is com,any +as ca,tured t+e desired audience* it can no# introduce ot+er co$#ebsites to increase ,rofitabi%ity* suc+ as Soa,s com Bo#s n /ies com is an internet based nic+e retai%er t+at is famous%y 1no#n for +a0ing t+e most #ide$ranging se%ection of nec1#ear any#+ere in t+e #or%d 3Hartman4 Po+% started t+is com,any in +is garage and it 7uic1%y gre# to a %arger office s,ace* em,%oying a do"en ,eo,%e* and is ser0ing customers a%% o0er t+e #or%d 3Hartman4 Once t+is nic+e com,any accom,%is+ed its goa% of ,ro0iding nec1ties in a%% co%ors and s+a,es* it +as no# e.,anded to se%%ing cuff %in1s and +and1erc+iefs Gumie" se%%s surf re%ated ,roducts to inc%ude c%ot+ing* foot#ear and accessories t+at su,,ort s1ate and sno# industries 3Gumie"4 (t #ent from a sing%e store to gro#ing o0er )&& retai% stores 3Gumie"4 Once t+is com,any ac+ie0ed its goa% of ,rofits from retai% stores* t+ey began to o,en on%ine stores Eo# t+e customer can c+oose #+et+er t+ey #ant to go to t+e ma%% or stay in t+e comfort of t+eir +omes and s+o, on%ine /+is com,any is successfu% because of its abi%ity to manage customers 0ia t+e internet* t+ird ,arty internet ser0ices and by retai%

Urban Outfitters Continuing Case Study Part 2: Creating a Business References Business !ocation 3n d4 Diverse Strategies. Retrie0ed 1< October 2&11 from +tt,:''### di0ersestrategies com'BusinessI%ocation +tm Hartman, Dennis 3n d 4 Examples of Niche Retail Companies C+ron Sma%% Business Retrie0ed 1B October 2&11 from +tt,:''sma%%business c+ron com'e.am,%es$nic+e$retai%$com,anies$1<@?1 +tm% Hybrids Cars 3n d4 Retrie0ed 1? October 2&11 from +tt,:''### fue%economy go0'feg'+ybridIsbsIcars s+tm% CP; Buddy 3n d4 Retrie0ed 1? October 2&11 from +tt,:''### m,gbuddy com'0e+ic%e$,rofi%e'2?>>>'2&11$+onda$accord$2dr$cou,e +tm% Scientific American 3&1Eo0ember 2&&14 Retrie0ed 1B October 2&11 from +tt,:''### scientificamerican com'artic%e cfmDidJ#+y$are$more$,eo,%e$rig+t Sangeet+a ; 3A,r 1H 2&&?4 Dog food brand Pedigree goes vegetarian, eyes niche markets Cydigtia%fc Retrie0ed 2& October 2&11 from

+tt,:''### mydigita%fc com'com,anies'dog$food$brand$,edigree$goes$0egetarian$eyes$ nic+e$mar1ets$??) United States Census 3n d4 Retrie0ed 1< October 2&11 from +tt,:''### census go0',rod'2&11,ubs'12statab',o, ,df Gumie" 3n d4 Retrie0ed 1? October 2&11 from +tt,:''### "umie" com'+e%,'information