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MGMT600_TeamA_WK8FINALPRESENTATION

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George Braga

This document provides information about the FitnessConnect business concept and management team. The management team includes Sean McQueen as CEO, Jeffrey Banks as CFO, Annapaula Sizemore as COO, and George Braga as Marketing Manager. The presentation agenda covers the business concept, mission, investor opportunities, market assessment, marketing plan, operations plan, and financial plan. The business concept is to provide live in-home workout broadcasts to offer flexibility and convenience. The mission is to deliver a higher quality of life through distinct fitness training. Investor opportunities include $200,000 for 33% partnership or $400,000 for 67% ownership.

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FITNESSCONNECT
MANAGEMENT TEAM Sean McQueen – CEO Jeffrey Banks – CFO Annapaula Sizemore – COO George Braga – Marketing Manager
PRESENTATION AGENDA  Business Concept  Company Mission  Investor opportunities  Market Assessment  Marketing Plan  Operations Plan  Financial Plan  Exit Strategy
BUSINESS CONCEPT OVERVIEW With competitors outdoing others year after year, FitnessConnect aims to build a commitment level within the target market; a level that makes it even easier to commit to. Our idea, in its entirety, is to provide a revolutionary Live In-home workout system broadcasted straight from a home-based gym. This will provide the flexibility to maintain a workout schedule no matter life’s daily challenges. For those who are onsite, FitnessConnect offers free health assessments and guides to healthy eating in addition to expected services and amenities. No matter what life’s daily challenges throw, FitnessConnect offers solutions to keep you on track to a healthier you.
MISSION STATEMENT “DELIVER A HIGHER QUALITY OF LIFE TO OUR CLIENTS BY OFFERING A DISTINCT STYLE OF FITNESS TRAINING” SLOGAN “COMMIT TO BE FIT”
INVESTOR OPPORTUNITIES $200,000 33% $400,000 67% Partners Capital Investors
INVESTMENT PROPOSAL  A steady return on investment  An excellent management team  A solid business plan  Anticipated 41% ROI by the end of year 5
SOURCES OF FUNDING $- $100,000.00 $200,000.00 $300,000.00 $400,000.00 $500,000.00 $600,000.00 $700,000.00 Sean McQueen Jeffrey Banks Annapaula Sizemore George Braga Investors Total Capital $400,000 Needed to get business off the ground. $80,000 $40,000$40,000$40,000 $600,000 $400,000
Presenting Market Assessment : GEORGE C. BRAGA
MARKET SIZE & TRENDS  Burbank Population – 104,391 (U.S. Census )  Media Center : Warner Bros. Entertainment, Warner Music Group, NBC Universal, The Walt Disney Company, ABC, Cartoon Network, Nickelodeon, Cookie Jar Entertainment, New Wave Entertainment, and Insomniac Games.  People who don’t mind spending more on convenience.
 Population aged between 18-50 years old  Based on lifestyle & interests PRIMARY MARKET SECONDARY MARKET  Population over 51 years old  Education, income etc. TARGETED MARKET
INDUSTRY ANALYSIS Industry at a Glance
INDUSTRY ANALYSIS INDUSTRYAT A GLANCE
MARKET SEGMENTATION
INDUSTRY DATA YEAR REVENUE $ MILLION GROWTH % 2015 $ 27,339.2 3.1 % 2016 $ 28,225.2 3.2 % 2017 $ 29,014.0 2.8 % 2018 $ 29,913.4 3.1 % 2019 $ 30,511.7 2.0 %
REGULATORY REVIEW  Industry’s regulation-light  NBFE- National Board of Fitness Examiners: 1. Define and address scope of practice for fitness professionals 2. Determine the standards of practice
COMPETITIVE ANALYSIS  In Burbank area - there are about 39 gym business focusing on regular fitness programs  Three major competitors: LA|FITNESS , 24 HOUR FITNESS AND EQUINOX  FitnessConnect – top of the line equipment, certified trainers, excellent customer service
COMPETITIVE ANALYSIS PRICE COMPARISON $749.99 $1,499.99 $4,807.69 $- $1,000.00 $2,000.00 $3,000.00 $4,000.00 $5,000.00 $6,000.00 Fitness Connect 24hr Fitness Equinox Membership with Personal Trainer
SWOT Analysis INTERNAL STRENGTHS WEAKNESSES  Certified personal trainers and dietician  Top of the line equipment  Highest quality of service  Accessibility for everybody  Strong management team  Specialized fitness plans  No established customer base  Unknown brand name  First business venture  Limited startup costs EXTERNAL OPPORTUNITIES THREATS  Growing market  Group training  Internet, social media  Targeting new demographics  Outdoor activities  Wide spread competition  Equipment maintenance  Local and federal regulations  Insurance costs  Consumer confidence
SURVEY QUESTIONS AND RESULTS 100 People Surveyed 1. What age group do you fall under? a. 18 to 35 years old b. 36 to 50 years old c. 51 years and up Answers: 48 % (A) // 33% (B) // 19 % (C) 2. How often do you go to the gym? a. 1 time per week b. 2-3 times per week c. 5+ times per week Answers: 57 % (A) // 21% (B) // 22 % (C) 3. Why do you go to the gym? a. Lifestyle b. Weight Loss c. Health Improvement d. Social Environment Answers: 37 % (A) // 8 % (B) // 12 % (C) //43 % (D)
SURVEY QUESTIONS AND RESULTS 100 People Surveyed 4. What are your preferred hours to visit the gym? a.5 AM – 12 PM b.12 PM – 6 PM c.6 PM – 12 AM Answers: 37% (5AM-12PM) // 5 % (12PM-6PM) // 48 % (6PM-12AM) 5. What is your preferred length of membership contract? a. Month to Month b. Semi-Annual Basis c. Annual Basis d. Not at all Answers: 32 % (A) // 53 % (B) // 12 % (C) // 3% (D) 6. How likely would you pay extra for the convenience of an in house workout service? a. Very b. Somewhat c. Not very d. Not at all Answers: 42% (A) // 35 % (B) //14% (C) // 9 % (D)
Presenting Marketing Plan : SEAN McQUEEN
MARKETING MIX • Innovative live In-Home Fitness and Gym Product • Membership starting at $24.99/month Price • Burbank, California • Direct Sales, advertising and Word of Mouth Place Promotion
MARKET NEED & PRODUCT EXCLUSIVITY Market Need • People of Burbank are in need of extra time to work out. Product Exclusivity • Live In-Home Workout
MARKETING STRATEGY Focuses on the following: • Elite Program • Increase Customer Base • Lifestyle Change • Target Market and Increase Market
PRICING STRATEGY Value Pricing • Low Basic Membership to draw in the masses • In-Home flexibility • More visits from personal trainers for same price.
MARKETING COMMUNICATION PLAN Customize Marketing Channels Brochures/Flyers Signs/Billboards Local News Papers Social Media Maintenance Housing
MARKETING BUDGET Where the $16,512 is spent Brochures/ Flyers Signs Billboards Local News Papers Online Maintenance Hosting 1st Year Advertising Plan
2014 2015 2016 2017 2018 Brochures/Flyers $2,917 $2,917 $2917 $2917 $2917 Signs/Billboards $10,000 $10,000 $10,000 $10,000 $10,000 Local News Papers $1,095 $1,095 $1,095 $1,095 $1,095 Online $1,000 $1,000 $1,000 $1,000 $1,000 Maintenance Hosting $1,500 $1,500 $1,500 $1,500 $1,500 Annual Expense $16,512 $16,512 $16,512 $16,512 $16,512
Presenting Operations Plan : ANNAPAULA SIZEMORE
MGMT600_TeamA_WK8FINALPRESENTATION
• 601 Glenoaks Blvd unit # 400 Burbank CA 91502 • Class A office space : 4500SF • Rental rate: $8,550.00/Month • 8 Work stations for workout • Kids area • Group Fitness Studio • Fitness Channels provided by Direct TV • Security System • Hours of Operation: • Monday – Friday 5:00 AM to 11:00 PM • Saturday 6:00 AM to 9:00 PM • Sunday 7:00 AM to 8:00 PM
MGMT600_TeamA_WK8FINALPRESENTATION
MGMT600_TeamA_WK8FINALPRESENTATION
MGMT600_TeamA_WK8FINALPRESENTATION
MGMT600_TeamA_WK8FINALPRESENTATION
Front Desk Customer Service Membership Sales Tours Packages and Prices MembershipTrainers Week Trial
Estimated Monthly Shop Expenses Salaries and wages $14,320 Employee benefits $2,500 Payroll taxes $2,148 Marketing and advertising $1,376 Property Lease Agreement $8,550 Fitness Equipment (Lease basis) $1,600 Broadcast Service $0 Insurance (Fire, Customer Accidental Property Lost or Damage, etc.) $250 Telephone Service $100 Utilities $300 Office & Cleaning Supplies $50 Gym Maintenance $200 Information Technology $120 Total Expenses $31,514
• Benefits & Incentives • Recruitment & Retention • Training & Development
CEO Operations Manager Janitor Master of Fitness Trainer Trainer Trainer Customer Service Market Manager Advertising Sales Representative Finance Manager Cashier Accountant
EMPLOYEES NUMBER OF STAFF MONTHLY WAGES BENEFITS PAYROLL TAXES Customer Service 2 $3,840 $833 $576 Master Of Fitness 1 $2,500 $417 $250 Trainers 3 7,500 $1250 $1,250 Janitorial 2 480 - $72 Accountant - - - - Cashier - - - - Advertising - - - - Sales Representative - - - - TOTAL $14,320 $2,500 $2,148 MONTHLY EMPLOYEES EXPENSES
Electricity Low/Medium Network Failure Medium/Low Legal Medium/Medium Employee Injury High/Medium Earthquake-High/High
MGMT600_TeamA_WK8FINALPRESENTATION
Presenting Financial Plan : JEFFREY BANKS
FINANCIAL ASSUMPTIONS Sales • Upon opening, FitnessConnect will have 4 membership levels • We expect to fall inline with the industry growth expectations of 3% Financial • In order to have FitnessConnect ready for business, our startup costs will be $325,000
START UP FUNDING $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 DUES - IHRSA LEASE CERTIFIED TRAINING FOR EMERGANCIES RENOVATION GYM EQUIPMENT PERSONAL TRAINER CERTIFICATION - NASM BUSINESS FURNITURE 1ST. YEAR'S SALARIES & WAGES COMPUTERS AND INFORMATION TECH TOTAL EXPENSES $550 $8,550 $1,200 $20,000 $85,000 $3,000 $20,000 $171,840 $15,000 $325,140 STARTUP COSTS - FITNESSCONNECT
SALES FORECAST $- $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 $1,400,000 2015 2016 2017 2018 2019 $368,830 $621,976 $866,993 $1,063,736 $1,276,612 PROJECTED SALES
STATEMENT OF CASH FLOW Cash Flow 2015 2016 2017 2018 2019 TOTAL TOTAL TOTAL TOTAL TOTAL CASH RECEIPTS Income from Sales Cash Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612 Collections $ - $ - $ - $ - $ - Total Cash from Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612 Income from Financing Interest Income $ 4,447 $ 5,169 $ 7,044 $ 10,178 $ 17,281 Loan Proceeds $ - $ - $ - $ - $ - Equity Capital Investments $ 400,000 $ - $ - $ - $ - Total Cash from Financing $ 404,447 $ 5,169 $ 7,044 $ 10,178 $ 17,281 Other Cash Receipts $ - $ - $ - $ - $ - TOTAL CASH RECEIPTS $ 773,277 $ 627,144 $ 874,037 $ 1,073,914 $ 1,293,893 CASH DISBURSEMENTS Operating Expenses $ 479,928 $ 468,059 $ 617,400 $ 658,019 $ 673,506 Capital Purchases $ - $ - $ - $ - $ - Loan Payments $ - $ - $ - $ - $ - Income Tax Payments $ - $ - $ - $ - $ - Investor Dividend Payments $ 40,000 $ 40,000 $ 40,000 $ 40,000 $ 40,000 Owner's Draw $ - $ - $ - $ - $ - TOTAL CASH DISBURSEMENTS $ 519,928 $ 508,059 $ 657,400 $ 698,019 $ 713,506 NET CASH FLOW $ 253,349 $ 119,085 $ 216,637 $ 375,895 $ 580,386 Opening Cash Balance $ 485,686 $ 587,253 $ 746,286 $ 1,079,165 $ 1,164,966 Cash Receipts $ 39,058 $ 65,953 $ 235,185 $ 289,118 $ 1,293,893 Cash Disbursements $ 71,394 $ 80,772 $ 192,400 $ 203,317 $ 713,506 ENDING CASH BALANCE $ 453,349 $ 572,434 $ 789,071 $ 1,164,966 $ 1,745,352
INCOME STATEMENT Statement of Income 2015 2016 2017 2018 2019 TOTAL TOTAL TOTAL TOTAL TOTAL INCOME Gross Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612 (Commissions) $ - $ - $ - $ - $ - (Returns and allowances) $ - $ - $ - $ - $ - Net Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612 (Cost of Goods) $ - $ - $ - $ - $ - GROSS PROFIT $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612 EXPENSES - General and Administrative Salaries and wages $ 171,840 $ 232,128 $ 256,620 $ 287,403 $ 320,061 Employee benefits $ 30,000 $ 47,250 $ 165,375 $ 173,644 $ 60,775 Payroll taxes $ 25,776 $ 34,819 $ 38,493 $ 43,110 $ 135,758 Marketing and advertising $ 16,512 $ 16,512 $ 16,512 $ 16,512 $ 16,512 Rent $ 102,600 $ 102,600 $ 102,600 $ 102,600 $ 102,600 Fitness Equipment $ 102,600 $ 19,200 $ 19,200 $ 19,200 $ 19,200 Dues and Certification Fees $ 4,800 $ 1,750 $ 4,800 $ 1,750 $ 4,800 Broadcast Services $ - $ - $ - $ - $ - Office Furniture $ 20,000 $ - $ - $ - $ - Insurance $ 3,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000 Telephone service $ 1,200 $ 1,200 $ 1,200 $ 1,200 $ 1,200 Utilities $ 3,600 $ 3,600 $ 3,600 $ 3,600 $ 3,600 Office supplies $ 600 $ 600 $ 600 $ 600 $ 600 Gym Maintenance $ 2,400 $ 2,400 $ 2,400 $ 2,400 $ 2,400 Information Technologies $ 15,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000 TOTAL EXPENSES $ 499,928 $ 468,059 $ 617,400 $ 658,019 $ 673,506 Net income before taxes $ (131,098) $ 153,916 $ 249,593 $ 405,717 $ 603,106 Provision for taxes on income $ - $ 43,097 $ 69,886 $ 113,601 $ 168,870 NET PROFIT $ (131,098) $ 110,820 $ 179,707 $ 292,116 $ 434,236
FIVE YEAR BALANCE SHEET Balance Sheet FitnessConnect 2015 2016 2017 2018 2019 ASSETS Current Assets Cash $453,349 $573,434 $789,071 $1,164,966 $1,745,352 Accounts Receivable $0 $0 $0 $0 $0 Other Current Assets $0 $0 $0 $0 $0 Total Current Assets $453,349 $573,434 $789,071 $1,164,966 $1,745,352 Fixed Assets Facilities $0 $0 $0 $0 $0 Equipment $102,600 $102,600 $102,600 $102,600 $102,600 Computers & Technologies $0 $0 $0 $0 $0 Office Furniture $20,000 $20,000 $20,000 $20,000 $20,000 Total Fixed Assets $122,600 $122,600 $122,600 $122,600 $122,600 Other Assets $0 $0 $0 $0 $0 TOTAL ASSETS $575,949 $695,034 $911,671 $1,287,566 $1,867,952 LIABILITIES Current Liabilities Short-Term Notes Payable $0 $0 $0 $0 $0 Income Taxes Due $0 $43,097 $112,983 $226,583 $395,453 Other Current Liabilities $0 $0 $0 $0 $0 Total Current Liabilities $0 $43,097 $112,983 $226,583 $395,453 Long-Term Liabilities Long-Term Notes Payable $0 $0 $0 $0 $0 Other Long-Term Liabilities $0 $0 $0 $0 $0 Total Long-Term Liabilities $0 $0 $0 $0 $0 NET WORTH Paid-In Capital $600,000 $600,000 $600,000 $600,000 $600,000 Retained Earnings ($24,051) $51,938 $198,688 $460,983 $872,500 Total Net Worth $575,949 $651,938 $798,688 $1,060,983 $1,472,500 TOTAL LIABILITIES AND NET WORTH $575,949 $695,034 $911,671 $1,287,566 $1,867,952
BREAK-EVEN ANALYSIS $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 $160,000 $180,000 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 SALES EXPENSES
VALUATION Gordon Model Approach • At the end of year five, the business is projected to have a value over $4.8 million dollars. Asset Valuation Approach • Under the Asset Valuation approach, business value at the end of year five is $1.9 million dollars.
TERMS OF PAYBACK  For the investor: The management team has projected that at the end of year 5, a return on investment of 41%  In the below chart will also show other key ratios for the first 5 years. Key Ratios Year 1 (2015-2016) Working Capital Current Ratio Quick Ratio Cash Turnover Debt to Equity Return on Investment Return on Sales Return on Assets 1st Quarter $481,547 N.A. N.A. 0.16 0.00 -30% -179% -30% 2nd Quarter $476,224 N.A. N.A. 0.18 0.00 -1% -7% -1% 3rd Quarter $477,471 2,612.82 2,612.82 0.20 0.00 0% 0% 0% 4th Quarter $453,349 N.A. N.A. 0.24 0.00 3% 13% 3% Year 2 (2016-2017) $529,338 13.28 13.28 1.18 0.07 24% 25% 22% Year 3 (2017-2018) $676,088 6.98 6.98 1.28 0.14 31% 29% 27% Year 4 (2018-2019) $938,383 5.14 5.14 1.13 0.21 38% 38% 32% Year 5 (2019-2020) $1,349,900 4.41 4.41 0.95 0.27 41% 47% 32%
EXIT STRATEGY We offer you a choice at the end of year five: • We can provide a cash buyout of your investment with a 30%plus over principal along with your end of year annual investment interest payment. • The second choice is to bring you onboard as a silent partner as we would gear up to open a second location in the Southern California area.
ANY QUESTIONS ?

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MGMT600_TeamA_WK8FINALPRESENTATION

  • 2. MANAGEMENT TEAM Sean McQueen – CEO Jeffrey Banks – CFO Annapaula Sizemore – COO George Braga – Marketing Manager
  • 3. PRESENTATION AGENDA  Business Concept  Company Mission  Investor opportunities  Market Assessment  Marketing Plan  Operations Plan  Financial Plan  Exit Strategy
  • 4. BUSINESS CONCEPT OVERVIEW With competitors outdoing others year after year, FitnessConnect aims to build a commitment level within the target market; a level that makes it even easier to commit to. Our idea, in its entirety, is to provide a revolutionary Live In-home workout system broadcasted straight from a home-based gym. This will provide the flexibility to maintain a workout schedule no matter life’s daily challenges. For those who are onsite, FitnessConnect offers free health assessments and guides to healthy eating in addition to expected services and amenities. No matter what life’s daily challenges throw, FitnessConnect offers solutions to keep you on track to a healthier you.
  • 5. MISSION STATEMENT “DELIVER A HIGHER QUALITY OF LIFE TO OUR CLIENTS BY OFFERING A DISTINCT STYLE OF FITNESS TRAINING” SLOGAN “COMMIT TO BE FIT”
  • 7. INVESTMENT PROPOSAL  A steady return on investment  An excellent management team  A solid business plan  Anticipated 41% ROI by the end of year 5
  • 9. Presenting Market Assessment : GEORGE C. BRAGA
  • 10. MARKET SIZE & TRENDS  Burbank Population – 104,391 (U.S. Census )  Media Center : Warner Bros. Entertainment, Warner Music Group, NBC Universal, The Walt Disney Company, ABC, Cartoon Network, Nickelodeon, Cookie Jar Entertainment, New Wave Entertainment, and Insomniac Games.  People who don’t mind spending more on convenience.
  • 11.  Population aged between 18-50 years old  Based on lifestyle & interests PRIMARY MARKET SECONDARY MARKET  Population over 51 years old  Education, income etc. TARGETED MARKET
  • 15. INDUSTRY DATA YEAR REVENUE $ MILLION GROWTH % 2015 $ 27,339.2 3.1 % 2016 $ 28,225.2 3.2 % 2017 $ 29,014.0 2.8 % 2018 $ 29,913.4 3.1 % 2019 $ 30,511.7 2.0 %
  • 16. REGULATORY REVIEW  Industry’s regulation-light  NBFE- National Board of Fitness Examiners: 1. Define and address scope of practice for fitness professionals 2. Determine the standards of practice
  • 17. COMPETITIVE ANALYSIS  In Burbank area - there are about 39 gym business focusing on regular fitness programs  Three major competitors: LA|FITNESS , 24 HOUR FITNESS AND EQUINOX  FitnessConnect – top of the line equipment, certified trainers, excellent customer service
  • 19. SWOT Analysis INTERNAL STRENGTHS WEAKNESSES  Certified personal trainers and dietician  Top of the line equipment  Highest quality of service  Accessibility for everybody  Strong management team  Specialized fitness plans  No established customer base  Unknown brand name  First business venture  Limited startup costs EXTERNAL OPPORTUNITIES THREATS  Growing market  Group training  Internet, social media  Targeting new demographics  Outdoor activities  Wide spread competition  Equipment maintenance  Local and federal regulations  Insurance costs  Consumer confidence
  • 20. SURVEY QUESTIONS AND RESULTS 100 People Surveyed 1. What age group do you fall under? a. 18 to 35 years old b. 36 to 50 years old c. 51 years and up Answers: 48 % (A) // 33% (B) // 19 % (C) 2. How often do you go to the gym? a. 1 time per week b. 2-3 times per week c. 5+ times per week Answers: 57 % (A) // 21% (B) // 22 % (C) 3. Why do you go to the gym? a. Lifestyle b. Weight Loss c. Health Improvement d. Social Environment Answers: 37 % (A) // 8 % (B) // 12 % (C) //43 % (D)
  • 21. SURVEY QUESTIONS AND RESULTS 100 People Surveyed 4. What are your preferred hours to visit the gym? a.5 AM – 12 PM b.12 PM – 6 PM c.6 PM – 12 AM Answers: 37% (5AM-12PM) // 5 % (12PM-6PM) // 48 % (6PM-12AM) 5. What is your preferred length of membership contract? a. Month to Month b. Semi-Annual Basis c. Annual Basis d. Not at all Answers: 32 % (A) // 53 % (B) // 12 % (C) // 3% (D) 6. How likely would you pay extra for the convenience of an in house workout service? a. Very b. Somewhat c. Not very d. Not at all Answers: 42% (A) // 35 % (B) //14% (C) // 9 % (D)
  • 22. Presenting Marketing Plan : SEAN McQUEEN
  • 23. MARKETING MIX • Innovative live In-Home Fitness and Gym Product • Membership starting at $24.99/month Price • Burbank, California • Direct Sales, advertising and Word of Mouth Place Promotion
  • 24. MARKET NEED & PRODUCT EXCLUSIVITY Market Need • People of Burbank are in need of extra time to work out. Product Exclusivity • Live In-Home Workout
  • 25. MARKETING STRATEGY Focuses on the following: • Elite Program • Increase Customer Base • Lifestyle Change • Target Market and Increase Market
  • 26. PRICING STRATEGY Value Pricing • Low Basic Membership to draw in the masses • In-Home flexibility • More visits from personal trainers for same price.
  • 27. MARKETING COMMUNICATION PLAN Customize Marketing Channels Brochures/Flyers Signs/Billboards Local News Papers Social Media Maintenance Housing
  • 28. MARKETING BUDGET Where the $16,512 is spent Brochures/ Flyers Signs Billboards Local News Papers Online Maintenance Hosting 1st Year Advertising Plan
  • 29. 2014 2015 2016 2017 2018 Brochures/Flyers $2,917 $2,917 $2917 $2917 $2917 Signs/Billboards $10,000 $10,000 $10,000 $10,000 $10,000 Local News Papers $1,095 $1,095 $1,095 $1,095 $1,095 Online $1,000 $1,000 $1,000 $1,000 $1,000 Maintenance Hosting $1,500 $1,500 $1,500 $1,500 $1,500 Annual Expense $16,512 $16,512 $16,512 $16,512 $16,512
  • 30. Presenting Operations Plan : ANNAPAULA SIZEMORE
  • 32. • 601 Glenoaks Blvd unit # 400 Burbank CA 91502 • Class A office space : 4500SF • Rental rate: $8,550.00/Month • 8 Work stations for workout • Kids area • Group Fitness Studio • Fitness Channels provided by Direct TV • Security System • Hours of Operation: • Monday – Friday 5:00 AM to 11:00 PM • Saturday 6:00 AM to 9:00 PM • Sunday 7:00 AM to 8:00 PM
  • 38. Estimated Monthly Shop Expenses Salaries and wages $14,320 Employee benefits $2,500 Payroll taxes $2,148 Marketing and advertising $1,376 Property Lease Agreement $8,550 Fitness Equipment (Lease basis) $1,600 Broadcast Service $0 Insurance (Fire, Customer Accidental Property Lost or Damage, etc.) $250 Telephone Service $100 Utilities $300 Office & Cleaning Supplies $50 Gym Maintenance $200 Information Technology $120 Total Expenses $31,514
  • 39. • Benefits & Incentives • Recruitment & Retention • Training & Development
  • 41. EMPLOYEES NUMBER OF STAFF MONTHLY WAGES BENEFITS PAYROLL TAXES Customer Service 2 $3,840 $833 $576 Master Of Fitness 1 $2,500 $417 $250 Trainers 3 7,500 $1250 $1,250 Janitorial 2 480 - $72 Accountant - - - - Cashier - - - - Advertising - - - - Sales Representative - - - - TOTAL $14,320 $2,500 $2,148 MONTHLY EMPLOYEES EXPENSES
  • 44. Presenting Financial Plan : JEFFREY BANKS
  • 45. FINANCIAL ASSUMPTIONS Sales • Upon opening, FitnessConnect will have 4 membership levels • We expect to fall inline with the industry growth expectations of 3% Financial • In order to have FitnessConnect ready for business, our startup costs will be $325,000
  • 46. START UP FUNDING $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 DUES - IHRSA LEASE CERTIFIED TRAINING FOR EMERGANCIES RENOVATION GYM EQUIPMENT PERSONAL TRAINER CERTIFICATION - NASM BUSINESS FURNITURE 1ST. YEAR'S SALARIES & WAGES COMPUTERS AND INFORMATION TECH TOTAL EXPENSES $550 $8,550 $1,200 $20,000 $85,000 $3,000 $20,000 $171,840 $15,000 $325,140 STARTUP COSTS - FITNESSCONNECT
  • 47. SALES FORECAST $- $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 $1,400,000 2015 2016 2017 2018 2019 $368,830 $621,976 $866,993 $1,063,736 $1,276,612 PROJECTED SALES
  • 48. STATEMENT OF CASH FLOW Cash Flow 2015 2016 2017 2018 2019 TOTAL TOTAL TOTAL TOTAL TOTAL CASH RECEIPTS Income from Sales Cash Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612 Collections $ - $ - $ - $ - $ - Total Cash from Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612 Income from Financing Interest Income $ 4,447 $ 5,169 $ 7,044 $ 10,178 $ 17,281 Loan Proceeds $ - $ - $ - $ - $ - Equity Capital Investments $ 400,000 $ - $ - $ - $ - Total Cash from Financing $ 404,447 $ 5,169 $ 7,044 $ 10,178 $ 17,281 Other Cash Receipts $ - $ - $ - $ - $ - TOTAL CASH RECEIPTS $ 773,277 $ 627,144 $ 874,037 $ 1,073,914 $ 1,293,893 CASH DISBURSEMENTS Operating Expenses $ 479,928 $ 468,059 $ 617,400 $ 658,019 $ 673,506 Capital Purchases $ - $ - $ - $ - $ - Loan Payments $ - $ - $ - $ - $ - Income Tax Payments $ - $ - $ - $ - $ - Investor Dividend Payments $ 40,000 $ 40,000 $ 40,000 $ 40,000 $ 40,000 Owner's Draw $ - $ - $ - $ - $ - TOTAL CASH DISBURSEMENTS $ 519,928 $ 508,059 $ 657,400 $ 698,019 $ 713,506 NET CASH FLOW $ 253,349 $ 119,085 $ 216,637 $ 375,895 $ 580,386 Opening Cash Balance $ 485,686 $ 587,253 $ 746,286 $ 1,079,165 $ 1,164,966 Cash Receipts $ 39,058 $ 65,953 $ 235,185 $ 289,118 $ 1,293,893 Cash Disbursements $ 71,394 $ 80,772 $ 192,400 $ 203,317 $ 713,506 ENDING CASH BALANCE $ 453,349 $ 572,434 $ 789,071 $ 1,164,966 $ 1,745,352
  • 49. INCOME STATEMENT Statement of Income 2015 2016 2017 2018 2019 TOTAL TOTAL TOTAL TOTAL TOTAL INCOME Gross Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612 (Commissions) $ - $ - $ - $ - $ - (Returns and allowances) $ - $ - $ - $ - $ - Net Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612 (Cost of Goods) $ - $ - $ - $ - $ - GROSS PROFIT $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612 EXPENSES - General and Administrative Salaries and wages $ 171,840 $ 232,128 $ 256,620 $ 287,403 $ 320,061 Employee benefits $ 30,000 $ 47,250 $ 165,375 $ 173,644 $ 60,775 Payroll taxes $ 25,776 $ 34,819 $ 38,493 $ 43,110 $ 135,758 Marketing and advertising $ 16,512 $ 16,512 $ 16,512 $ 16,512 $ 16,512 Rent $ 102,600 $ 102,600 $ 102,600 $ 102,600 $ 102,600 Fitness Equipment $ 102,600 $ 19,200 $ 19,200 $ 19,200 $ 19,200 Dues and Certification Fees $ 4,800 $ 1,750 $ 4,800 $ 1,750 $ 4,800 Broadcast Services $ - $ - $ - $ - $ - Office Furniture $ 20,000 $ - $ - $ - $ - Insurance $ 3,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000 Telephone service $ 1,200 $ 1,200 $ 1,200 $ 1,200 $ 1,200 Utilities $ 3,600 $ 3,600 $ 3,600 $ 3,600 $ 3,600 Office supplies $ 600 $ 600 $ 600 $ 600 $ 600 Gym Maintenance $ 2,400 $ 2,400 $ 2,400 $ 2,400 $ 2,400 Information Technologies $ 15,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000 TOTAL EXPENSES $ 499,928 $ 468,059 $ 617,400 $ 658,019 $ 673,506 Net income before taxes $ (131,098) $ 153,916 $ 249,593 $ 405,717 $ 603,106 Provision for taxes on income $ - $ 43,097 $ 69,886 $ 113,601 $ 168,870 NET PROFIT $ (131,098) $ 110,820 $ 179,707 $ 292,116 $ 434,236
  • 50. FIVE YEAR BALANCE SHEET Balance Sheet FitnessConnect 2015 2016 2017 2018 2019 ASSETS Current Assets Cash $453,349 $573,434 $789,071 $1,164,966 $1,745,352 Accounts Receivable $0 $0 $0 $0 $0 Other Current Assets $0 $0 $0 $0 $0 Total Current Assets $453,349 $573,434 $789,071 $1,164,966 $1,745,352 Fixed Assets Facilities $0 $0 $0 $0 $0 Equipment $102,600 $102,600 $102,600 $102,600 $102,600 Computers & Technologies $0 $0 $0 $0 $0 Office Furniture $20,000 $20,000 $20,000 $20,000 $20,000 Total Fixed Assets $122,600 $122,600 $122,600 $122,600 $122,600 Other Assets $0 $0 $0 $0 $0 TOTAL ASSETS $575,949 $695,034 $911,671 $1,287,566 $1,867,952 LIABILITIES Current Liabilities Short-Term Notes Payable $0 $0 $0 $0 $0 Income Taxes Due $0 $43,097 $112,983 $226,583 $395,453 Other Current Liabilities $0 $0 $0 $0 $0 Total Current Liabilities $0 $43,097 $112,983 $226,583 $395,453 Long-Term Liabilities Long-Term Notes Payable $0 $0 $0 $0 $0 Other Long-Term Liabilities $0 $0 $0 $0 $0 Total Long-Term Liabilities $0 $0 $0 $0 $0 NET WORTH Paid-In Capital $600,000 $600,000 $600,000 $600,000 $600,000 Retained Earnings ($24,051) $51,938 $198,688 $460,983 $872,500 Total Net Worth $575,949 $651,938 $798,688 $1,060,983 $1,472,500 TOTAL LIABILITIES AND NET WORTH $575,949 $695,034 $911,671 $1,287,566 $1,867,952
  • 52. VALUATION Gordon Model Approach • At the end of year five, the business is projected to have a value over $4.8 million dollars. Asset Valuation Approach • Under the Asset Valuation approach, business value at the end of year five is $1.9 million dollars.
  • 53. TERMS OF PAYBACK  For the investor: The management team has projected that at the end of year 5, a return on investment of 41%  In the below chart will also show other key ratios for the first 5 years. Key Ratios Year 1 (2015-2016) Working Capital Current Ratio Quick Ratio Cash Turnover Debt to Equity Return on Investment Return on Sales Return on Assets 1st Quarter $481,547 N.A. N.A. 0.16 0.00 -30% -179% -30% 2nd Quarter $476,224 N.A. N.A. 0.18 0.00 -1% -7% -1% 3rd Quarter $477,471 2,612.82 2,612.82 0.20 0.00 0% 0% 0% 4th Quarter $453,349 N.A. N.A. 0.24 0.00 3% 13% 3% Year 2 (2016-2017) $529,338 13.28 13.28 1.18 0.07 24% 25% 22% Year 3 (2017-2018) $676,088 6.98 6.98 1.28 0.14 31% 29% 27% Year 4 (2018-2019) $938,383 5.14 5.14 1.13 0.21 38% 38% 32% Year 5 (2019-2020) $1,349,900 4.41 4.41 0.95 0.27 41% 47% 32%
  • 54. EXIT STRATEGY We offer you a choice at the end of year five: • We can provide a cash buyout of your investment with a 30%plus over principal along with your end of year annual investment interest payment. • The second choice is to bring you onboard as a silent partner as we would gear up to open a second location in the Southern California area.

Editor's Notes

  • #5: This slide is just a suggestion .