Executive Summary
Smart Sport is a new company operating in the sports apparel industry for active lifestyles. Due to the characteristics of its products, Smart Sport may be regarded as a partnership between professional athletes, sports clothes manufacturers, and technological companies as its shareholders. On the one hand, entering the sports apparel market is profitable. Due to people’s growing interest in healthy and active lifestyles, it was valued at $167.7 billion in 2018 and is estimated to reach $248.1 billion by 2026 (Allied Market Research, 2019, para. 1).
At the same time, the market may be characterized by high competition determined by the presence of many rivals, the bargaining power of customers, and a relative ease of entry. That is why Smart Sport presents a product that will be its unique selling proposition (USP) – the use of smart textiles. Because a limited number of brands offer the same product, this opportunity allows Smart Sport to take its market niche, avoid the threat of substitution, and attract customers’ attention.
Product and Branding
In general, bright clothing is the integration of systems for collecting and transmitting data into textiles. Smart Sport offers three types of bright clothing: passive, active, and ultra-smart (Scataglini et al., 2020). Passive smart textiles are clothes with miniature sensors that collect information related to the human body, such as heart rate, calories, or step count. Active, bright fabrics imply equipment with sensors and actuators that monitor motions (Scataglini et al., 2020). Finally, ultra-smart apparel has integrated microcomputers that collect data and respond to it, for instance, providing thermoregulation.
Marketing
Considering the expenditures related to production and the business’s size, the first outlet will be virtual – in other words, people can order products from an official website only with delivery across the United States. Nevertheless, massive marketing will ensure customer attraction, including promoting products via social networks and the involvement of sports influencers who will receive products for demonstration and honest evaluation. This strategy is expected to spread awareness about Smart Sport among young high- and middle-income Internet users, the company’s target audience.
Production
Due to the benefits of outsourcing, products will be manufactured in China using traditional textiles of the highest quality to create sports apparel and electronic devices sent from South Korea by a technology company as this venture’s partner. In general, production should focus on a particular technology, such as placing functional yarn between the layers of fabric and ensuring the safety of a finished product for a customer.
Management
The company’s headquarters, financial, marketing, human resources, and other departments, along with a warehouse, will be located in Southern California. At the same time, there will be close cooperation and communication with Korean and Chinese stakeholders and local transportation companies via email, video, and audio calls. Every department will have a manager responsible for their team’s performance, and all essential strategic decisions will be articulated during regular meetings with the general manager. In addition, a part of the company’s workforce will perform remotely depending on employees’ responsibilities. Recruitment will be done via job offerings on social networks.
Financial Plan and Statement
Funds required to launch a new product are $400,000 – $200,000 has already been raised through founder investments, and $200,000 is expected to be invested by a Korean technological company. These funds will cover essential expenses, including inventory, production, advertising, staffing, and operating expenses. To stay profitable, it is expected to achieve a 20% growth rate in the first year and raise it to 25% in the following years. In addition, it is expected to maintain a constant product margin, accumulating resources through fixed costs and growing sales. In the future, funds are expected to increase through cooperation with local outlets to distribute and realize a product.