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Milestone One: Investment Project and Justification
NEUROstorm by Nordstrom
P. Leanne Mahoney
MBA 640 Finance, Economics, and Decision
Dr. Brandon Foor
May 14, 2023
2
Milestone One: Investment Project and Justification
II. Investment Project: NEUROstorm by Nordstrom
Description
NEUROstorm by Nordstrom is a unique expansion opportunity for Nordstrom, Inc. that is designed to serve the neurodiverse population in the United Kingdom. Research says, “
Neurodiversity
refers to the different ways the brain can work and interpret information” (UK local gov. Association, 2023). Neurodivergent individuals make up approximately 15% of the population in the United Kingdom, with 1 in 100 people on the autism spectrum (Colley, 2023). This represents a significant market need for a retail environment that caters to the unique needs of neurodivergent
individuals. Establishing a store section tailored to the requirements of the neurodiverse community and providing them with a sensory-friendly shopping environment is central to the concept. The goal of this growth potential is to meet the needs of the neurodiverse population, which has been underserved by traditional retail outlets. The NEUROstorm by Nordstrom store will be situated in a prominent location in the United Kingdom, making the neurodiverse community more accessible. The store’s layout, design, and offerings will be tailored to the requirements of the neurodiverse community, with sensory-friendly lighting and sound levels, as well as a sensory-friendly atmosphere.
Various financial metrics will be utilized to evaluate the performance of NEUROstorm by
Nordstrom. These metrics consist of income, profit margins, and customer satisfaction. The financial performance of the store will be thoroughly monitored to ensure it meets its revenue goals and generates profits. One financial aspect to account for is currently, the conversion rate of the U. S. Dollar versus the United Kingdom-British Pound (GBP) is $1000.00GBP to
3
Milestone One: Investment Project and Justification
$1214.20USD. Currently the British pound is worth slightly more than the U.S. Dollar (Travelex,
2023). Renting or leasing retail space in a prime location can be a costly endeavor. Depending on the location, the premier retail rent in London ranges between £200 and £500 per square foot per year, according to a report by Colliers International. Assuming a retail space of approximately 5,000 square feet, this could translate into annual real estate costs ranging from £1
million to £2.5 million. Consideration of the average salary range required to staff this concept store is crucial when evaluating this expansion opportunity. Glassdoor says, “The national average salary for a Retail Sales Associate is £21,414 in United Kingdom” (Glassdoor, 2023).
Customer satisfaction will also be a key performance metric for NEUROstorm by Nordstrom. Regularly soliciting consumer feedback will guarantee that the store meets the needs of the neurodiverse community and provides a pleasant shopping experience. In addition, Nordstrom will work with advocacy groups and organizations representing the neurodiverse community to ensure that the store meets their needs and expectations.
Resources
To implement this new concept in a new retail market, this expansion opportunity will necessitate a range of resources. Due to the dynamic nature of their target customer base, the business will need to recruit employees who are trained to meet the specific requirements of the neurodiverse community. This will necessitate substantial expenditures on staff training, recruitment, and retention. These employees will be recruited from the local market, and if necessary, additional training and development programs may be provided.
Regarding the location of this new concept store, consideration must be given to the desired atmosphere of the neurodiverse community. The location of the NEUROstorm by
4
Milestone One: Investment Project and Justification
Nordstrom store must be accessible to the neurodiverse community. With appropriate lighting, soundproofing, adaptive clothing and household items, and other modifications, the store must be adapted to meet the sensory requirements of this population. Nordstrom will need to lease or purchase a location that meets these specifications.
Operating the NEUROstorm by Nordstrom store in the UK requires Nordstrom to obtain all necessary government authorizations. It will take time and a lot of legal and administrative resources. To comply with local regulations, Nordstrom must work closely with regulatory agencies to understand their requirements and obtain the necessary permits and licenses. In addition, Nordstrom must follow local labor, tax, and environmental laws. With careful planning and execution, Nordstrom can navigate the regulatory landscape and succeed in the UK.
The protection of Intellectual property Is essential for any business, and Nordstrom Is no exception. To protect its Neurostorm by Nordstrom concept, the business will need to allocate substantial legal resources. This includes registering trademarks and patents so that no one else can profit from their innovative ideas. It also involves the expensive and time-consuming procedure of enforcing their intellectual property rights. However, the investment is worthwhile in the long run because it safeguards Nordstrom’s brand reputation and ensures they maintain a competitive advantage in the market. Without adequate protection, competitors could take Nordstrom’s ideas and profit from them, resulting in substantial financial losses for the company.
By taking these measures, Nordstrom can rest assured that their intellectual property is safe and that their business will be protected for years to come.
In conclusion, the successful implementation of the NEUROstorm by Nordstrom concept in the United Kingdom will require significant investments in human resources, facilities, government approvals, intellectual property, and access to natural resources. Nordstrom is
5
Milestone One: Investment Project and Justification
committed to making this investment and is confident that it will result in an increase in revenue and customer loyalty. This expansion opportunity can be discovered with the aid of the requested
$15 million loan. With the financial resources in place, Nordstrom can now concentrate on executing the project in a timely manner. The subsequent step is to develop a schedule that will direct the implementation of the NEUROstorm by Nordstrom concept in the United Kingdom.
Time Frame
It is anticipated that the NEUROstorm by Nordstrom project will launch in the third quarter of the following fiscal year. The project schedule assumes that the necessary resources will be secured within the next few months, including the lease or purchase of a suitable location,
the hiring and training of personnel, and the procurement of equipment and materials. It will take
about a year to complete the project, which includes the construction and customization of the store, the creation of marketing and promotional materials, and the formation of partnerships with local organizations that support neurodiverse individuals.
As mentioned previously, the expected economic life of the proposed expansion is five years, if the NEUROstorm by Nordstrom concept will acquire traction in the United Kingdom market and become a profitable segment of Nordstrom’s overall business. According to the International Trade Administration, it takes an average of three to five years for a U.S. retail corporation to establish a presence in a foreign market and begin making money there (International Trade Administration, 2022). In addition, the 5-year timeframe is consistent with industry standards for evaluating the efficacy of retail expansions. Many retailers, according to a McKinsey & Company study, believe that five years is sufficient for evaluating the success of a new store or concept (Hoskins et al., 2021).
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