SECTION 1: THE ENTREPRENEUR CASE
You are purchasing a store that sells casual clothes, a specialty business in the retail apparel industry with a long history in the local community.
It has been a family-owned business for many years, selling tops and pants for work and recreation at moderate prices. The youngest members of the family pursued careers in other fields and the retiring owners are interested in selling the business to ambitious entrepreneurs who can update the image and carry the business forward.

You will be purchasing and managing a specialty retail business. Four startup decisions are required. They are:
• naming your business
• store location
• product line
• financing
Your lease expires during the first simulation period, so you have the opportunity to renew the lease at the current rent or relocate.

Location

The store has been in the same location for many years, across from the college campus. The college location appeals to the student population and there is a fair amount of trade from surrounding neighborhoods.
Rent is $5,000 per quarter, and the store is about 1,500 square feet, including both display area and storage space. While parking is limited, foot traffic in the area is constant, and the previous owners have been moderately successful in this location. Their sales last year were
$400,000 and their after-tax profit was just over $11,000. The lease expires now, so you have the opportunity to renew the lease at the current rent or relocate.
If you plan to continue selling a medium-priced casual line of clothing, then staying at the college location should be a good choice. On the other hand, if you are targeting a different customer base, another location might make more sense. Small retail apparel stores can be found in a variety of locations. Although they are most prevalent in retail malls, successful operations can be found in