Multi Sport Complex Business Plan
The Supreme Courts will be a full-service multisport complex located along Boulder Highway in Henderson, Nevada. There are currently no other sports facilities like this in the Las Vegas Valley. This plan will define the scope of our services and help us secure the necessary investments to open the facility. It will also be used to evaluate The Supreme Courts’ mission, goals, and objectives.
The keys to success for The Supreme Courts are effective marketing, creating an unmatched "cool" atmosphere, and hiring qualified staff for our programs and leagues.
The sports and fitness club industry is a booming business that generated over $10.6 billion last year. The Supreme Courts projects a strong net profit in its first year of operation, with significant growth by the end of year three.
** Confidential or proprietary information has been deleted.
1.1 Objectives
The main objectives for The Supreme Courts are as follows:
1. Sell 800 memberships in year one, 1,200 in year two, and 1,600 in year three.
2. Develop and market various sports leagues to capacity (i.e., seven leagues running twice a year with 8-12 teams per league).
3. Sponsor and/or support four community events in our first year of operation.
4. Achieve at least a 5% return to investors in the first year of operation.
1.2 Mission
The Supreme Courts is a multisport and fitness complex for residents of Henderson and surrounding areas. Our mission is to provide the best programs, staff, and equipment to meet the sports and fitness needs of our members while generating a profit. In addition to delivering value to our customers, we aim to create an unmatched sporting atmosphere that enhances the enjoyment of every member and employee. We also strive to support and sponsor community events. Our facility aims to enhance members’ enjoyment and appreciation for sports, fitness, and life.
Keys to Success for The Supreme Courts:
1. Marketing: Make The Supreme Courts a common name in the Las Vegas Valley and creatively market our services to each market segment.
2. Atmosphere of facility: Create an unmatched "cool" atmosphere in The Supreme Courts with first-class equipment, floors, colors, and big-screen TVs to enhance member retention.
3. Knowledgeable/qualified staff and management: Provide patrons with knowledgeable and qualified staff who show genuine concern for their sport and fitness needs.
The Supreme Courts is a new multisport complex offering a variety of sports and leisure programs for both members and casual users.
Company Ownership:
The Supreme Courts will be a Limited Partnership C corporation privately owned by Brian Ehlert and Rich Bohne, who will each own 26% of the company. Additionally, 12 other limited partners will each own 4%.
Start-up Summary:
Our start-up requirements amount to $2,500,000, covering land, building, development costs, equipment, and start-up capital. The assumptions are detailed in the following table and chart.
Start-up Requirements:
– Legal: $30,000
– Air Structure: $415,000
– Hardwood Floors: $160,000
– Basketball Rims, Stands…: $55,000
– Exercise Equipment and Misc.: $150,000
– Stucco: $8,000
– Block Fence: $90,000
– Concrete Footings and Slab: $185,000
– Site Preparation: $20,000
– Consultants: $3,500
– Mechanical: $25,000
– Second Floor Development and Offices: $210,000
– Office Equipment: $65,000
– Paving and Landscaping: $112,000
– Management Fee: $100,000
– Promotional Costs: $40,000
– Design Fees: $30,000
– Land: $465,000
– Total Start-up Expenses: $2,163,500
Start-up Assets:
– Cash Required: $336,500
– Start-up Inventory: $0
– Other Current Assets: $0
– Long-term Assets: $0
– Total Assets: $336,500
Total Requirements: $2,500,000
Start-up Funding:
– Start-up Expenses to Fund: $2,163,500
– Start-up Assets to Fund: $336,500
– Total Funding Required: $2,500,000
Assets:
– Non-cash Assets from Start-up: $0
– Cash Requirements from Start-up: $336,500
– Additional Cash Raised: $0
– Cash Balance on Starting Date: $336,500
– Total Assets: $336,500
Liabilities and Capital:
– Liabilities:
– Current Borrowing: $0
– Long-term Liabilities: $1,250,000
– Accounts Payable (Outstanding Bills): $0
– Other Current Liabilities (interest-free): $0
– Total Liabilities: $1,250,000
– Capital:
– Planned Investment:
– Investor 1: $100,000
– Investor 2: $100,000
– Investor 3: $100,000
– Investor 4: $100,000
– Investor 5: $100,000
– Investor 6: $100,000
– Investor 7: $100,000
– Investor 8: $100,000
– Other: $450,000
– Total Planned Investment: $1,250,000
– Loss at Start-up (Start-up Expenses): ($2,163,500)
– Total Capital: ($913,500)
– Total Capital and Liabilities: $336,500
– Total Funding: $2,500,000
Services:
The Supreme Courts is a multisport complex that offers various services. It includes a fitness and lifestyle center, three full-size basketball courts, a food and beverage area, a massage therapy clinic, offices, a conference room, a childcare center, and full-service locker rooms. Qualified and knowledgeable staff are available to meet the sport and fitness needs of the users.
Weights and Fitness:
The Supreme Courts will have a large fitness and lifestyle center with top-of-the-line equipment in free weights, machine weights, and aerobic machines. It will be located on the upper level, allowing users to watch the activities below or enjoy the TVs set up for their enjoyment. A certified strength and conditioning specialist (CSCS) will oversee this aspect of the facility.
Courts:
The Supreme Courts will have three full-size basketball courts and six volleyball courts. The hardwood floors will be manufactured and installed by Robbins Sport Surfaces. Rich Bohne, a general partner, will be responsible for scheduling events and activities on these floors.
Food Services:
The facility will have a food and beverage area on the upper level overlooking the courts. Big screen TVs will show sporting events and other programs. A qualified person will be hired to run this area and meet the needs of the users.
Massage Therapy:
There will be a massage therapy clinic on the main floor of the facility, available to the general public and users of the facility at a cost reflective of the industry standard. The decision to hire massage therapists or lease the space to an established practice is yet to be made.
Other:
Other features include full-service locker rooms, a childcare area, administrative offices and a conference room, and a pro shop selling sports shoes and apparel. The pro shop’s inventory will be managed by Brian Ehlert, a general partner.
Market Analysis Summary:
The Supreme Courts will be the only multisport complex in the Las Vegas Valley. It caters to a diverse range of market segments, including weekend warriors, hardcore fitness buffs, gym rats, families, senior citizens, business travelers, and tourists. The facility has a bright future due to the increasing trend of memberships at health clubs and the popularity of fitness programs.
Market Segmentation:
The target market segments for The Supreme Courts include weekend warriors who prefer flexible commitments, dedicated fitness buffs, gym rats who seek places to play and hang out, families looking for fun and recreation, senior citizens interested in health programs, business travelers, and tourists attracted to the facility’s unique appearance.
Market Analysis:
Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
Potential Customers Growth
Weekend Warriors 3% 132,479 136,453 140,547 144,763 149,106 3.00%
Hardcore Fitness Gurus 3% 6,080 6,262 6,450 6,643 6,843 3.00%
Gym Rats 3% 325,000 334,750 344,792 355,136 365,790 3.00%
Families 3% 50,000 51,500 53,045 54,636 56,275 3.00%
Senior Citizens 7% 24,320 26,022 27,843 29,793 31,878 7.00%
Tourists 1% 10,000 10,100 10,201 10,303 10,406 1.00%
Business Travelers 0% 3,000 3,000 3,000 3,000 3,000 0.00%
Total 3.14% 550,879 568,087 585,878 604,274 623,298 3.14%
4.2 Target Market Segment Strategy
Due to the size and convenient location of our facility, many people will be attracted to The Supreme Courts to see what we have to offer. However, we will not wait for customers to come to us. Instead, we will focus our marketing strategies on market segments that match our offerings. The great thing about marketing The Supreme Courts is that each market segment relates to all the others.
Our main objective with our early marketing strategy will be to get people into our facility. Once people see what we have to offer and feel the atmosphere, they will want to return and participate in the activities and programs available to them.
Some ways The Supreme Courts will attract people to the facility include:
1. Offering tours to junior and senior high schools during the building and early completion stages.
2. Hosting a large promotional event to open the facility that will be free.
3. Hosting and/or supporting various community events to bring in many people.
4. Mailing out free day passes to the surrounding area.
After the opening of The Supreme Courts, print and radio media will be used to promote the facility and programs to attract new people from all over the Las Vegas Valley.
As a member, many resources are available for marketing and promotional ideas that have been effective for other facilities.
4.3 Service Business Analysis
The sport and fitness industry is a booming industry with total revenues surpassing $10.6 billion in 1999. Fitness clubs are popping up everywhere, including airports and grocery stores. The size and scope of these clubs vary from small, individually owned workout facilities to complex franchises. According to statistics, as of July 2000, there were 15,910 clubs in the USA with over 30 million total club members. Multisport clubs, like The Supreme Courts, averaged over 2,800 members per club. One of The Supreme Courts’ challenges is to establish itself as a legitimate sport and fitness club that appeals to each market segment and offers a great deal for members and casual walk-ins.
4.3.1 Competition and Buying Patterns
The competition for The Supreme Courts in Henderson includes two clubs, **, **, and **. These clubs offer various types of memberships, some with long-term commitments and others with a minimum commitment of at least one full month.
Potential fitness club members usually compare clubs and find the one that fits their specific needs or has the desired amenities. Value is usually very important to these members as they want the best value for their money.
Strategy and Implementation Summary
The Supreme Courts has a large potential market. Due to the small number of recreation and fitness facilities in Henderson, we aim to become the number one sports and fitness complex quickly. This will be accomplished through active promotion via radio and media advertisements, as well as hosting and supporting various community events.
5.1 Competitive Edge
The Supreme Courts’ competitive edge comes from its offering of three full-size basketball courts that are available for members and the community to use and rent. Additionally, the scope and variation of programs offered at the facility are unmatched by any other club in the area. The location, size, and appearance of the facility will also attract many people.
By maintaining our focus on strategy, marketing, program development, and fulfillment, The Supreme Courts will become known as the top sports and fitness club in Henderson. We should be aware that our competitive edge may diminish if we become complacent in program development and implementation. It will be important to keep up with current trends in sport and fitness programs.
5.2 Sales Strategy
Sales in the sport and fitness club business are based on the services and amenities provided by the facility. The Supreme Courts aims to provide something for everyone. Each person desiring a membership will have the opportunity to sit down with a representative to explore membership options, services, programs, and amenities. Establishing a relationship of trust with members is important for membership retention.
5.2.1 Sales Forecast
The table and chart provide a forecasted breakdown of sales for each source of revenue.
Sales Forecast:
(Unit Sales)
Membership Fees: 780, 1,000, 1,200
Walk-in Fees: 10,800, 10,800, 11,340
Camps, Clinics, and Programs: 720, 720, 1,500
Court Rentals: 720, 720, 756
Leagues: 2,304, 2,048, 2,150
Personal Training: 1,080, 1,134, 1,191
Pro Shop: 12, 1, 1
Food and Beverages: 12, 1, 1
Massage Therapy Clinic: 1,050, 1,080, 1,134
Other (Outside Tournaments…): 4, 0, 0
Total Unit Sales: 17,482, 17,504, 19,273
(Unit Prices)
Membership Fees: $647.00, $679.35, $679.35
Walk-in Fees: $4.50, $4.75, $5.00
Camps, Clinics, and Programs: $25.00, $75.00, $78.75
Court Rentals: $40.00, $42.00, $44.10
Leagues: $65.00, $68.25, $71.65
Personal Training: $15.00, $16.00, $17.00
Pro Shop: $1,500.00, $18,900.00, $19,845.00
Food and Beverages: $2,500.00, $31,500.00, $33,075.00
Massage Therapy Clinic: $5.00, $5.25, $5.50
Other (Outside Tournaments…): $4,000.00, $4,200.00, $4,350.00
(Sales)
Membership Fees: $504,660, $679,350, $815,220
Walk-in Fees: $48,600, $51,300, $56,700
Camps, Clinics, and Programs: $18,000, $54,000, $118,125
Court Rentals: $28,800, $30,240, $33,340
Leagues: $149,760, $139,776, $154,048
Personal Training: $16,200, $18,144, $20,247
Pro Shop: $18,000, $18,900, $19,845
Food and Beverages: $30,000, $31,500, $33,075
Massage Therapy Clinic: $5,250, $5,670, $6,237
Other (Outside Tournaments…): $16,000, $0, $0
Total Sales: $835,270, $1,028,880, $1,256,836
(Direct Unit Costs)
Membership Fees: $0.00, $0.00, $0.00
Walk-in Fees: $0.00, $0.00, $0.00
Camps, Clinics, and Programs: $0.00, $0.00, $0.00
Court Rentals: $0.00, $0.00, $0.00
Leagues: $0.00, $0.00, $0.00
Personal Training: $0.00, $0.00, $0.00
Pro Shop: $0.00, $0.00, $0.00
Food and Beverages: $0.00, $0.00, $0.00
Massage Therapy Clinic: $0.00, $0.00, $0.00
Other (Outside Tournaments…): $0.00, $0.00, $0.00
(Subtotal Direct Cost of Sales)
Total Sales: $0, $0, $0
5.3 Milestones
The table lists program milestones, dates, managers, and budgets. It emphasizes planning for implementation.
Our business plan includes provisions for plan-vs.-actual analysis. We will hold monthly follow-up meetings to discuss variance and course corrections.
Milestones:
Milestone Start Date End Date Budget Manager Department
Business Plan 9/11/2000 9/22/2000 $0 Rich Department
Concept Plan Review 9/15/2000 10/3/2000 $3,500 Rich Department
Financial Backing Presentations 3/1/1999 4/1/1999 $0 TBA Department
Company Set Up 3/1/1999 4/1/1999 $0 TBA Department
Logo Design 3/1/1999 4/1/1999 $0 TBA Department
Other 3/1/1999 3/1/1999 $0 TBA Department
Totals $3,500
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