Burly Skate Shop

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Skateboard Gear Retail Business Plan

Market Analysis Summary

The primary target customer of Burly will be the skateboarding, snow boarding, and surfing teen/young adult of Suburb and the greater Salem area.  As we are situated in the epi-center of their residental community we believe they will make up the largest percentage of our customer base.

Another target customer of Burly will be, due to the popularity of the store, curiosity seekers.  We expect to see an assortment of local residents from the community as well as seasonal purchasers during all boarding seasons.

4.1 Market Segmentation

Skateboarding, snow boarding, and surfing are popular pastimes for Northwest youth. We estimate a target population of 2,500 junior high and high school-aged students in Suburb, most of whom will visit Burly at least once, as the new cultural experience and the one and only skate shop in Suburb.

Our secondary target market consists of Salem youth, who represent a growing population of skateboarders, snow boarders, and surfers who will shop outside of the Salem area. The store is located in Suburb, a suburb of Salem, but accessible to Salem customers by car or bus.

The last area of potential customers is adults. There are hundreds of avid skateboarders who travel all the skate parks throughout the northwest, thus the importance of locating Burly just 3 blocks from the Suburb skate park.  Other adults will bring their kids in to buy the most trendy school clothes, shoes, boards, accessories, and gifts, and may fund something for themselves while browsing. Our ambience and customer service will make them repeat customers.

Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
Keizer Youth 15% 2,500 2,875 3,306 3,802 4,372 15.00%
Salem Youth 15% 1,500 1,725 1,984 2,282 2,624 15.01%
Adults 15% 500 575 661 760 874 14.98%
Total 15.00% 4,500 5,175 5,951 6,844 7,870 15.00%

4.2 Target Market Segment Strategy

Skateboarding, snow boarding and surfing have become new and fast growing industries in the Northwest today.  Boarding is no longer a fad or a pastime but is here to stay. Movies, magazines, X-Games, Olympics, television, and video games all feature boarding sports.  Burly is a part of this growing industry.

While our marketing efforts will differ slightly for Suburb and Salem youth, our sales strategies rely on a further differentiation in our target markets. Our younger customers can be generally classified as either trendsetters or trend followers:

  • Trendsetters keep up with online chats about boards, manufacturers, new wheel technology, and new maneuvers. They are unafraid to pioneer the use of a new board style or clothing item if they feel it gives them an edge (aesthetically, socially, or in performance). They are willing to spend a great deal of money to be on the cutting edge, and in most circumstances, do this by ordering online or direct from the manufacturer to access items unavailable in the local area. Our challenge with these customers is to direct them to our custom-ordering capabilities, and to let them feel they have "discovered" a new trend on their own.

  • Trend Followers, on the other hand, are anxious not to be seen as too far out of the mainstream, which means playing a constant game of "catch-up" with the trendsetters, requiring regular purchases of new equipment and clothing. They learn about new styles online and in magazines, but are more influenced by the local adoption of such styles by members of their cohort or by high-profile boarders they wish to emulate. When offered a choice, they are most likely to shop locally, so they can see, in the display of inventory, how their choice fits in relation to other products offered to their cohort. Our challenge with this group is to stay on top of local trends so as to keep in stock a good array of colors and accessories for the style-of-the-month. 

Our older customers choose merchandise based on more personal needs - preferred styles and manufacturers generally outweigh "trendiness." Although we do not have the expertise to serve older customers as a font of skateboarding experience, we hope that our convenient location will draw them in, and our selection and flexibility, with custom-ordering, will generate repeat business.

4.3 Industry Analysis

The skateboarding industry is expanding faster than ever. Although skateboarding merchandise is priced at a premium, people buy it because it provides them with fashionable yet durable products. In the last five years, skateboarding supplies from most manufacturers have become available online. With a click of the mouse, customers can see and compare prices on hundreds of items, from boards and accessories, to clothing and protective gear. This shift has served to stabilize prices, and to increase the accessibility of new skateboarding products in rural and outlying areas.

However, online shopping happens alone, in one's home; it is not a social experience. Skateboarding is about seeing and being seen in the latest, coolest clothes, with a killer board, doing amazing, highly-skilled tricks, and sharing them with friends. Skateboarding is not a solitary sport, and solitary skateboard shopping goes against the grain for this sport.

The retail side of boarding (skateboarding and snow boarding) is highly fragmented, although the strength of the biggest manufacturers, in terms of advertising and sheer mass of product on the market, homogenizes the standard retailer's inventory. Some smaller, home-grown operations both manufacturer and sell boards, doing especially well in urban areas on the West Coast.

Burly will combine the advantages of both models by offering a wide selection of boards, gear, and accessories from the major manufacturers, with custom-ordering capabilities for more unusual items. We will maintain an up-to-date catalogue of all the most recent products from smaller manufacturers on the West Coast, for customers to browse through while in the store. 

4.3.1 Competition and Buying Patterns

Skateboarders are looking for two things: trendiness and high quality (often in that order). These customers are young, and easily influenced by peer pressure. They want to buy an item unique enough to express their individuality and sophistication about the technical sides of skateboarding, but not so avant-garde that it is difficult to use or confusing to their cohort.

Competitors
Burly is competing on two fronts - against local, custom manufacturers, and larger retail stores and chains. The following are two examples:

Competitor #1 is a custom board carver in Suburb who works exclusively with Baltic Birch. He has a strong online presence, and his unique styles are popular with trendsetters, since their custom design puts them outside the reach of customer buying only existing boards.

Competitor #2 is a retail skate and snowboarding shop in Salem. They also have stores in Mt. Hood and Portland. Competitor #2 has experienced, knowledgeable staff, and a great reputation among local skaters. We will be modeling much of our business on their success, while differentiating ourselves with custom-ordering capabilities and our suburban location.