Presentation Transcript
Milestone 5April 4, 2006: Milestone 5 April 4, 2006 Jared Foster, Nick Lindner, Ryan Alden, Nathan Imboden VB Sports Complex Website Virginia Beach Sports Complex
Fundraising Approach: Fundraising Approach We will first look to market ourselves with local venture capitalists
We will also look for successful businesses to help fund us
We will also look to borrow money from a bank
Amount needed: Amount needed In the range of 5.5 million
Use of proceeds: Use of proceeds Costs for the building
Costs for equipment
Donations to needy families
Advertising costs
Costs for employees and other miscellaneous costs
Rule of thumb: Rule of thumb We plan on breaking even in about half the time we have taken out for our loans Nature of raise Debt
Pricing Model: Pricing Model Membership fees
Camps and clinics
Walk-in’s
Field rentals
Leagues
Food
Sports shop
Other Elastic
Elastic
Elastic
Elastic
Elastic
Inelastic
Inelastic
Elastic Many competitors
High quality, high price
Price range large factor
Quality field raises cost
Appease the consumer for return
Rental
Rental
Outdoor fields must be worth cost Competitive
Prestige
Competitive
Prestige
Competitive
Outsourced
Outsourced
Competitive
Service Elasticity Advantage Rationale
Competitive Pricing: Competitive Pricing Competitive Alternative Pricing Considerations
YMCA membership $45 a month
Bally total fitness $225 a year
Gold’s Gym $35-45 a month
LANCO field house $130 per child in camps
Summer Camps $ free to 200 a camp
Sports clinics $25-200 a clinic
Most facilities offering sports related or gyms usually cost less for a targeted market. Our market niche includes a large variety of services between clinics to gym facilities.
By analyzing the cost of individual services and other sports
complexes offering similar services, our price combines each
aspect of what we offer. i.e. Bally total fitness, Virginia sports camps, YMCA, and boys and girls clubs.
Pricing Model Considerations: Pricing Model Considerations
Mark-up pricing: Analyze the market fully establishing the cost of which we need to revenue so as to cover the expenses.
Follow-the-leader pricing: using companies (mainly LANCO) for an established sports complex, many of which our expenses and projected revenue ideas come from them
Price lining: while we use a larger projected market, our offering of different prices to use certain facilities gave us a niche. The price lining model helped us establish which service would bring the most money
Breakeven Analysis: Breakeven Analysis
The realization of us reaching a break even point with a facility costing in the millions, our expected sales forecast will realistically not reach break even point for at least three years. The forecast shows the expected income at 1.75 million in two years (modeled by LANCO field house).
The breakeven points actually are a collaboration of many different services collectively forecasting sales. Each individual service collaborates a revenue that individually would not suffice for the company.
Strengths: Strengths There is a marketplace
The potential revenue is high
Weakness: Weakness Start up/Operation Cost are high
Investors will need to take a risk