1. April Sproehnle Brooke-Ann Embry Natalie Read
Urban Outfitters, INC.
April Sproehnle
Brooke-Ann Embry
Natalie Read

2. History of Urban Outfitters, INC
First store opened in 1970 near University of Pennsylvania
Richard Hayne and Roommate Scott Belair called the store Free People
Came up with idea to open store for college students that would sell inexpensive clothing and items for dorms and apartments
Became huge success and incorporated in 1976 under name Urban Outfitters
Began opening more stores in metropolitan areas within 3 years
Anthropologie opened in 1992

3. Type and Format of Stores
American merchandiser offering two retail chains: Urban Outfitters and Anthropologie
Multiple retail lines including Free People and Terrain
Urban Outfitters
Casual clothing, furniture, accessories and house wares assortments
Ages 18-30
Every Urban Outfitters store is located in a renovated building
No stores look exactly the same

4. Target Customer Urban Outfitters Anthropologie Free People Terrain
College aged individuals who are self expressive and culturally sophisticated
Anthropologie
Thirty to forty year old women who are contemporary, sophisticated, eclectic, and unique
Free People
Women aged who are interested in sixties and hip apparel
Terrain
Men and women interested in creative and sophisticated outdoor living and garden experience

5. Competitive Strategy and Positioning
Highly visible store locations
Creative store design
Broad merchandise selection
Gets majority of merchandise from overseas vendors and never allows more than ten percent of in-store merchandise to be from same vendor
Moderately priced and unique from other competitive stores
Visible presentation of merchandise
Offers Exceptional Customer service
Customer mailing lists, response rates, catalog presentations, merchandise delivery, web site design and availability

6. Merchandise Assortment
Urban Outfitters: Men & Women’s apparel, shoes, and accessories to items for the apartment.
 Lifestyle-specific shopping experience particularly for urban- minded individual ranging from years of age.
Anthropologie: women’s clothing, accessories, shoes, beauty, home furnishing, found objects, gifts, and decor portraying vintage to global design.
 Surrounds a sense of beauty, optimism, and discovery to the customer.

7. Merchandise Assortment cont.
Free People: women’s apparel, accessories, and house ware.
 Specific for carefree, confident, and curious young women
BHLDN: heirloom-quality gowns, artisanal hair adornments, bridesmaid frocks, party dresses, footwear, jewelry, and lingerie.
 Offers brides, partygoers, and party throwers inspired alternative to life’s most anticipated milestones.

8. Merchandise Assortment cont.
Leifsdottir: wholesale apparel line, extraordinary details to women’s clothing and accessories such as unique trims, vintage buttons and intricate linings.
 New sense of sophistication, timeless collectables with modern- dressmaking through fine fabrics and tailoring.
Terrian: plants for all seasons, inspired items for home and garden, all at an on-site nursery.
 Transforms local garden centers, to an unforgettable experience for the senses

9. Service Description Direct-to-Consumers Catalogs Internet
We believe that our sites increase the reputation and recognition of our brands with our target customers and help support the strength of our stores operation. They go on to say, We also believe that our catalogs have aided in expanding our distribution channels and increasing brand awareness.

10. Location and Site Choices
Urban Outfitters: Operates in more than 130 stores in the United States, Canada, and Europe.
 Specific locations in Europe include: London, Ireland, and Sweden.
 Business district of heavily populated metropolitan cities
Anthropolgie: mainly online but operates in stores worldwide; on site location is in Wayne, Pennsylvania.
 Also, chooses sites in business districts in heavily populated metropolitan cities to attract customers walking down the street.

11. Location and Site Choices cont.
Free People: wholesale brand, encompasses over 30 stores in the United States, three wholesale showrooms, cultivated relationships with 1,500 boutiques and departments stores across the globe.
 Bloomingdale’s, Nordstrom, Lord & Taylor, Belk, and Macy’s
BLHLN: unveiled Valentines day 2011, and the first store will not open until fall, 2011.
Leifsdottir: wholesale line that is sold to specialty stores.
Terrian’s Flagship location is in Gen Mills, Pennsylvania.

12. Promotional Mix and Plan Implementation
Key: shopping experience
Creating an experience, not just selling products.
Goal: to sell a unique experience
Do not advertise
Rely heavily on word of mouth
Customers will spread the word and promote the great products and experience that is available in all stores.
Customer Relationship Management (CRM) is a vital component

13. Promotional Mix and Plan Implementation cont.
Target Market is very small.
Money goes towards decorating its stores and securing prime urban location.
Avoids enclosed malls.
Unique Layout of Store
Known for their market penetration.
Expanded market development with the addition of their new line BHLDN, Leifsdottir, and Terrain.

14. Pricing Stress quality of products High standards
Wide demographics due to material of merchandise
Dress range from $32 up to $548
Shoes range from $29 up to $348

15. Logistics Urgency to Buy Small amounts of merchandise
Love selling out of items

16. Organizational Structure (Led from top to bottom)
Lead by Board of Directors
Corporate Officers
Regional Managers
District Managers
Designers
Store Managers
Assistant store managers
Sales Associates

17. Human Resource Policies
Hiring: rely heavily on resumes, personality characteristics, and fashion knowledge
Training: follows & mock customers tests
Exceptional benefits creates strong relationship with employees
Healthcare program to both full time and salaried staff
The plan addresses the costs of preventative care, hospital stays, emergency room visits, physician office visits, and prescription.

18. Buying Organizations
Ability to ship lean amounts of merchandise due to Concept to Market
Complementary supply chain strategy
Flexibility is key
Dual Sourcing strategies
Alternate Locations
Decrease in turnaround time
Far East
Private Brand Merchandise from about 15 vendors
Establishing relationships with their agents
Eliminate middlemen
TradeStone’s System

19. Data for fiscal years (2007-2010) In millions of dollars
2007:
Net Sales: 1,224
Cost of Goods Sold: 164
Gross Margin: 452
Expenses: 409
Net Profit (Income): 116
Number of Stores: Urban- 158, Anthropologie- 125, Free People- 32 stores, 1383 department
Average Inventory: 149
Total Assets: 899
2008:
Net Sales: 1,508
Cost of Good Sold: 224
Gross Margin: 577
Expenses: 414
Net Profit (Income): 160
Number of Stores: Urban- 160, Anthropologie- 128, Free People- 34 stores, 1,386 department
Average Inventory: 125.3
Total Assets: 1,142

20. Data continued 2009: 2010: Net Sales: 1,834 Cost of Goods Sold: 299
Gross Margin: 713
Expenses: 447
Net Profit (Income): 199
Number of Stores: Urban- 163, Anthropologie- 130, Free People- 35 stores, 1,389 department
Average Inventory: 111.5
Total Assets: 1,329
2010:
Net Sales: 1,937
Cost of Goods Sold: 338
Gross Margin: 786
Expenses: 522
Net Profit (Income): 219
Number of stores: Urban-170, Anthropologie- 135, Free People- 35 stores, 1,400 departments
Average Inventory: 106.2
Total Assets: 1,636

21. Financial Ratio Analysis
2010
2009
2008
2007
Sales per store
6.24
5.81
6.13
5.72
Inventory
5.9
5.4
5.6
5.3
ROA
15.2
14.8
12.7
11.9
GMROI
19.3
18.5
16.5
13.8
Expenses
9.83%
10.02%
10.39%
10.99%
Net Profit Margin
11.0%
12.0%
14.0%
15.0%
Asset Turnover
1.3
1.2
1.4
Gross Margin %
45.6%
45.3%
43.9%
42.2%

22. Comparison to Top Competitor
Urban Outfitters, INC.
ROA: 15.2%
Net Profit Margin: 11.0%
Inventory Turnover: 5.9
Gross Margin Percentage: 45.6%
GAP, INC.
ROA: 17.0%
Net Profit Margin: 6.5%
Inventory Turnover: 5.3
Gross Margin Percentage: 44.0%

23. Suggestions Open more retail stores
Different locations
Open free standing stores for Free People and Terrain lines
Open Warehouse stores selling all merchandise and brands in one location
Other lines should sell men’s and children’s merchandise
Enhance online shopping experience
Integrate coffee shops and/or restaurant
Keep employees satisfied by offering more incentives