Gamehenge Tapers Co-op is a nonprofit organization serving the Portland tapers community. This community, which trades live recordings for personal use only, relies on the Co-op for equipment to support their taping activities. The Co-op sells recording equipment at wholesale prices, along with a low overhead percentage, encouraging members to engage in more taping. As a not-for-profit co-op, volunteers contribute their time, ensuring the organization’s success and support for the trading community.
Membership dues and a nominal overhead fee cover the organization’s expenses and facilitate gradual growth. Gamehenge Tapers Co-op aims to increase its membership by at least 20% annually.
1.1 Objectives
The objectives for the first three years of operation are:
– Create a co-op whose primary goal is to serve its members.
– Increase the membership base by 20% annually.
– Provide the Portland traders community with cost + overhead deals on CD-R media, microphones, CD-RWs, and DAT recorders.
– Develop a sustainable co-op.
1.2 Mission
The mission of Gamehenge Tapers Co-op is to serve the Portland tapers community. We aim to attract and maintain customers while exceeding their expectations.
Organization Summary
Gamehenge Tapers Co-op is a co-operative organization serving the Portland tapers community. This community consists of hobby-based individuals who record and trade live concerts. All the bands that allow live recordings are "live" or "jam" bands that incorporate improvisation into their performances, making each show unique. Members of the group trade these live performances for personal consumption, appreciating the distinct qualities of each show. Commercial use of these shows is strictly prohibited.
The organization sells a wide range of equipment for tapers. This equipment is purchased through regular wholesale channels and sold directly to organizational members. Entry to the co-op requires membership, which can be obtained by paying a $40 fee and providing proof of traders status (typically a list of show recordings). Products must be purchased through the website and picked up from the office during designated times throughout the week. Questions about products can be answered via email or phone (usually voicemail with a return call).
2.1 Legal Entity
Gamehenge Tapers Co-op is a 501C not-for-profit co-operative organization.
2.2 Start-up Summary
The start-up costs for Gamehenge Tapers Co-op include:
– Desk, chair, and file cabinet.
– Computer with printer, CD-RW, and internet connection.
– Legal fees for forming not-for-profit status, including filing fees.
– Website development.
Gamehenge Tapers Co-op offers the tapers community CD-RW drives, high quality stereo microphones, DAT portable recorders, and CD-R media.
Gamehenge Tapers Co-op serves the Portland tapers community, a group of people who attend live performances and tape them for personal use and trading. The organization will increase membership through word of mouth and a website.
The taping community in Portland consists of individuals who legally tape live concerts. While most bands prohibit taping, select bands allow it to promote their music. These bands have loyal followings and play unique set lists each night.
Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
Potential Customers Growth 200 220 242 266 293 10.02%
Tapers 10% 200 220 242 266 293 10.02%
Other 0% 0 0 0 0 0 0.00%
Total 10.02% 200 220 242 266 293 10.02%
4.2 Target Market Segment Strategy
The strategy behind market segmentation is based on word of mouth and web site visibility. The taping community is close knit, so attending shows and taping will introduce you to many tapers. Growing the membership list through word of mouth is easy.
Gamehenge Tapers Co-op will also have a web site to attract new members. The site will have more content, including password-protected ordering for members only.
4.3 Service Providers Analysis
The taping industry is relatively unregulated. As long as bands allow taping, the community is free to do as they want. It is a self-formed group that polices themselves.
4.3.1 Alternatives and Usage Patterns
The competition includes mail order places, retail outlets, and e-commerce sites. They may offer a better selection, but they rarely compete on price since they are for-profit organizations. Gamehenge Tapers Co-op, on the other hand, is not-for-profit.
Tapers are typically price-sensitive buyers, constantly looking for the best price.
Strategy and Implementation Summary
Gamehenge Tapers Co-op will aggressively use word of mouth advertising to generate new members. This is cost-effective as members are already at the concerts taping for themselves.
The co-op will have a web site to attract new members, but word of mouth promotion will be more effective.
5.1 Competitive Edge
Gamehenge Tapers Co-op’s competitive edge is its co-operative business structure. It is not-for-profit, which means all revenue benefits the members. Members can purchase equipment at drastically reduced prices compared to retail.
5.2 Fundraising Strategy
The sales strategy is to increase membership. This increases buying power, reducing costs for members.
5.2.1 Funding Forecast
The first month will be used to set up the office and web site. The office will be small and have low rental costs. The web site will provide general information and detailed product information. Products can only be purchased via the web site and picked up from the office at specific times.
Month two will see increased sales and membership, with activity continuing in the following months.
Funding Forecast:
Year 1 Year 2 Year 3
Funding
Tapers $37,294 $41,545 $42,154
Membership income $3,800 $0 $0
Total Funding $41,094 $41,545 $42,154
Direct Cost of Funding:
Year 1 Year 2 Year 3
Tapers $33,565 $37,391 $37,939
Membership income $0 $0 $0
Subtotal Cost of Funding $33,565 $37,391 $37,939
5.3 Milestones:
Gamehenge Tapers Co-op will have several milestones early on:
– Business plan completion. This will serve as a roadmap for the organization. While not required to raise capital, it is essential for the ongoing performance and improvement of the company.
– Office set up.
– The 100th member signed up.
Management Summary:
Gamehenge Tapers Co-op was founded and led by Al Truistic. Al graduated from the University of Vermont with a business degree. After college, Al spent five months on the road following the band Phish, which introduced him to the taping scene. Returning to Portland, Al earned his MBA from the University of Portland. He joined VersionTracker, an internet startup that provided software updates for Mac OS while still maintaining his love for taping. After numerous discussions with the Portland taping community, Al recognized the demand for a tapers co-op and started investing his free time to pursue this goal.
6.1 Personnel Plan:
Al will work part-time for Gamehenge Tapers Co-op, handling purchasing, order fulfillment, and general management. His wife, Sarah, will assist with membership and financials. These positions are unpaid volunteer roles. Web maintenance will be done by a member at a below-market rate. Al and Sarah plan to recruit more volunteers once the co-op becomes more active to handle the necessary details.
The following sections outline the important financial assumptions, key financial indicators, break-even analysis, profit and loss, cash flow, and balance sheet.
7.1 Important Assumptions:
The table below highlights significant financial assumptions for Gamehenge Tapers Co-op.
General Assumptions:
Year 1 Year 2 Year 3
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 2.50% 0.00% 2.50%
Other 0 0 0
7.2 Break-even Analysis:
The Break-even Analysis illustrates the monthly revenue needed to break even.
Break-even Analysis
Monthly Revenue Break-even: $1,741
Assumptions:
– Average Percent Variable Cost: 82%
– Estimated Monthly Fixed Cost: $319
7.3 Projected Surplus or Deficit
The following table indicates projected surplus or deficit.
Surplus and Deficit:
| | Year 1 | Year 2 | Year 3 |
|———-|——–|——–|——–|
| Funding | $41,094| $41,545| $42,154|
| Direct Cost | $33,565| $37,391| $37,939|
| Other | $0| $0| $0|
| Total Direct Cost | $33,565| $37,391| $37,939|
| Gross Surplus | $7,529| $4,155| $4,215|
| Gross Surplus % | 18.32%| 10.00%| 10.00%|
Expenses:
| | Year 1 | Year 2 | Year 3 |
|————–|——–|——–|——–|
| Payroll | $0 | $0 | $0 |
| Sales and Marketing and Other Expenses | $600| $600| $600|
| Depreciation | $228| $228| $228|
| Leased Equipment| $0| $0| $0|
| Utilities | $0 | $0 | $0 |
| Insurance | $600 | $600 | $600 |
| Rent | $2,400 | $2,400 | $2,400 |
| Payroll Taxes| $0 | $0 | $0 |
| Other | $0 | $0 | $0 |
| Total Operating Expenses | $3,828 | $3,828 | $3,828 |
Surplus Before Interest and Taxes:
| Surplus Before Interest and Taxes | Year 1 | Year 2 | Year 3 |
|———————————-|——–|——–|——–|
| Surplus Before Interest and Taxes | $3,701 | $327 | $387 |
| EBITDA | $3,929 | $555 | $615 |
| Interest Expense | $0 | $0 | $0 |
| Taxes Incurred | ($48) | $0 | $10 |
| Net Surplus | $3,749 | $327 | $378 |
| Net Surplus/Funding | 9.12% | 0.79% | 0.90% |
7.4 Projected Cash Flow
The following chart and table indicate projected cash flow.
Pro Forma Cash Flow:
Year 1 Year 2 Year 3
Cash Received:
Cash from Operations
Cash Funding $41,094 $41,545 $42,154
Subtotal Cash from Operations $41,094 $41,545 $42,154
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
Sales of Other Current Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $0 $0 $0
Subtotal Cash Received $41,094 $41,545 $42,154
Expenditures:
Expenditures from Operations
Cash Spending $0 $0 $0
Bill Payments $36,615 $42,634 $41,602
Subtotal Spent on Operations $36,615 $42,634 $41,602
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $0
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $36,615 $42,634 $41,602
Net Cash Flow $4,479 ($1,089) $552
Cash Balance $4,729 $3,641 $4,193
Projected Balance Sheet:
Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets:
Current Assets
Cash $4,729 $3,641 $4,193
Inventory $4,083 $4,548 $4,615
Other Current Assets $0 $0 $0
Total Current Assets $8,812 $8,189 $8,808
Long-term Assets
Long-term Assets $1,150 $1,150 $1,150
Accumulated Depreciation $228 $456 $684
Total Long-term Assets $922 $694 $466
Total Assets $9,734 $8,883 $9,274
Liabilities and Capital:
Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $4,585 $3,407 $3,420
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $4,585 $3,407 $3,420
Long-term Liabilities $0 $0 $0
Total Liabilities $4,585 $3,407 $3,420
Paid-in Capital $2,000 $2,000 $2,000
Accumulated Surplus/Deficit ($600) $3,149 $3,476
Surplus/Deficit $3,749 $327 $378
Total Capital $5,149 $5,476 $5,853
Total Liabilities and Capital $9,734 $8,883 $9,274
Net Worth $5,149 $5,476 $5,853
Appendix
Funding Forecast
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Funding
Tapers 0% $0 $1,545 $2,587 $3,654 $3,878 $4,578 $3,254 $4,578 $2,587 $3,124 $3,385 $4,124
Membership income 0% $160 $360 $400 $480 $400 $320 $280 $200 $360 $280 $200 $360
Total Funding $160 $1,905 $2,987 $4,134 $4,278 $4,898 $3,534 $4,778 $2,947 $3,404 $3,585 $4,484
General Assumptions
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Plan Month 1 2 3 4 5 6 7 8 9 10 11 12
Current Interest Rate 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00%
Tax Rate 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Other 0 0 0 0 0 0 0 0 0 0 0 0
Surplus and Deficit
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Funding $160 $1,905 $2,987 $4,134 $4,278 $4,898 $3,534 $4,778 $2,947 $3,404 $3,585 $4,484
Direct Cost $0 $1,391 $2,328 $3,289 $3,490 $4,120 $2,929 $4,120 $2,328 $2,812 $3,047 $3,712
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Direct Cost $0 $1,391 $2,328 $3,289 $3,490 $4,120 $2,929 $4,120 $2,328 $2,812 $3,047 $3,712
Gross Surplus $160 $515 $659 $845 $788 $778 $605 $658 $619 $592 $539 $772
Gross Surplus % 100.00% 27.01% 22.05% 20.45% 18.42% 15.88% 17.13% 13.77% 20.99% 17.40% 15.02% 17.23%
Expenses
Payroll $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales and Marketing and Other Expenses $50 $50 $50 $50 $50 $50 $50 $50 $50 $50 $50 $50
Depreciation $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 $19
Leased Equipment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Utilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $
Pro Forma Cash Flow
| Pro Forma Cash Flow | ||||||||||||
| Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
| Cash Received | ||||||||||||
| Cash from Operations | ||||||||||||
| Cash Funding | $160 | $1,905 | $2,987 | $4,134 | $4,278 | $4,898 | $3,534 | $4,778 | $2,947 | $3,404 | $3,585 | $4,484 |
| Subtotal Cash from Operations | ||||||||||||
| Additional Cash Received | ||||||||||||
| Sales Tax, VAT, HST/GST Received | 0.00% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| New Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| New Other Liabilities (interest-free) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| New Long-term Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Sales of Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Sales of Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| New Investment Received | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Subtotal Cash Received | ||||||||||||
| Expenditures | ||||||||||||
| Expenditures from Operations | ||||||||||||
| Cash Spending | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Bill Payments | $8 | $351 | $3,235 | $3,693 | $4,624 | $4,049 | $5,007 | $2,045 | $5,583 | $1,357 | $3,021 | $3,643 |
| Subtotal Spent on Operations | ||||||||||||
| Additional Cash Spent | ||||||||||||
| Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Principal Repayment of Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Other Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Long-term Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Purchase Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Purchase Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Dividends | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Subtotal Cash Spent | ||||||||||||
| Net Cash Flow | $152 | $1,554 | ($248) | $441 | ($346) | $849 | ($1,473) | $2,733 | ($2,636) | $2,047 | $564 | $841 |
| Cash Balance | $402 | $1,955 | $1,708 | $2,149 | $1,803 | $2,652 | $1,180 | $3,913 | $1,277 | $3,324 | $3,888 | $4,729 |
Pro Forma Balance Sheet
| Pro Forma Balance Sheet | |||||||||||||
| Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
| Assets | |||||||||||||
| Current Assets | |||||||||||||
| Cash | $250 | $402 | $1,955 | $1,708 | $2,149 | $1,803 | $2,652 | $1,180 | $3,913 | $1,277 | $3,324 | $3,888 | $4,729 |
| Inventory | $0 | $0 | $1,530 | $2,561 | $3,617 | $3,839 | $4,532 | $3,221 | $4,532 | $3,204 | $3,093 | $3,351 | $4,083 |
| Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Total Current Assets | $250 | $402 | $3,485 | $4,269 | $5,766 | $5,642 | $7,185 | $4,401 | $8,445 | $4,480 | $6,417 | $7,239 | $8,812 |
| Long-term Assets | |||||||||||||
| Long-term Assets | $1,150 | $1,150 | $1,150 | $1,150 | $1,150 | $1,150 | $1,150 | $1,150 | $1,150 | $1,150 | $1,150 | $1,150 | $1,150 |
| Accumulated Depreciation | $0 | $19 | $38 | $57 | $76 | $95 | $114 | $133 | $152 | $171 | $190 | $209 | $228 |
| Total Long-term Assets | $1,150 | $1,131 | $1,112 | $1,093 | $1,074 | $1,055 | $1,036 | $1,017 | $998 | $979 | $960 | $941 | $922 |
| Total Assets | $1,400 | $1,533 | $4,597 | $5,362 | $6,840 | $6,697 | $8,221 | $5,418 | $9,443 | $5,459 | $7,377 | $8,180 | $9,734 |
| Liabilities and Capital | |||||||||||||
| Current Liabilities | |||||||||||||
| Accounts Payable | $0 | $244 | $3,113 | $3,538 | $4,490 | $3,878 | $4,943 | $1,854 | $5,540 | $1,257 | $2,900 | $3,485 | $4,585 |
| Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
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I’m Andrew Brooks, a seasoned finance consultant from the USA and the mind behind phonenumber247.com.
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