Youth Sports Nonprofit Business Plan

In the Richmond Metro area, only 25% of youth participated in organized sports last year, compared to 85-90% in the suburbs, as stated in State University’s recent report on Richmond’s Youth Sport Need Assessment. Currently, there are 40,000 children aged 6-14 in the Richmond Metro area. Unlike the suburbs, the metro area lacks a comprehensive range of youth sports programs with sufficient financial backing. This delayed introduction to organized sports has particularly negative implications for urban girls, as it denies them the chance to engage in physical activity, receive coaching, be part of a team, learn skills, and avoid engaging in "negative recreation" such as drugs, violence, or sexual activities.

Clinical studies have shown that sports and recreation programs can help establish lifelong, healthy physical activity patterns in youth. Regular physical activity helps prevent life-threatening diseases, reduces feelings of depression and anxiety, maintains a healthy weight, and promotes healthy bones, muscles, and joints, according to the President’s Council on Physical Fitness.

Regardless of age, race, gender, family composition, income, or community, children in the city’s core must have equal opportunities in education and sports from the start. In response to this significant disparity, YouthSports aims to provide the necessary sports programs for Richmond children, ensuring equal access to organized sports.

Thanks to a three-year matching grant from The John Ford Stevenson Foundation (JFSF), YouthSports, along with corporate partners, plans to utilize organized sports and physical activity programs to promote healthy youth development.

The JFSF, based in San Francisco, CA, is the nation’s largest philanthropy devoted to health care. Its grantmaking focuses on three goals: ensuring access to basic health care at reasonable cost, improving care and support for people with chronic health conditions, and reducing personal, social, and economic harm caused by substance abuse, including tobacco, alcohol, and illicit drugs.

Schools and health care centers will handle sport registration, as they have a clear understanding of their communities’ needs. Along with matching contributions from local partners, the JFSF renewable matching grant will provide substantial funding for the project.

The collaborating partners include:

• BlueCross/BlueShield
• Mayor Linda Hargrove and the City of Richmond
• Parks & Recreation Department
• Richmond Unified School District
• Templex Corporation
• A.I. Kaufman and Sons
• PriceRight Supermarkets
• Avion Computers
• The Richmond Mall
• Richmond Bank
• Rider Corporation

With this support base, YouthSports will raise additional funds through program sponsorship and fundraising campaigns.

1.1 Objectives

• Increase participation in youth sports and recreation programs in the Richmond Metro area.
• Increase youth access to health care and healthy development.

1.2 Mission

The mission of YouthSports is to create a youth sport program in the Richmond Metro area, increasing sport participation rates and promoting healthy development of youth.

1.3 Keys to Success

• Utilize the school system to promote the sports program and recruit team coaches.
• Minimize field maintenance and facility costs with the school and city park systems.
• Maintain the City Council’s support to provide scholarship funds for needy youth who want to participate in sports.
• Recruit corporate support for the sports program.
• Maintain a high approval rate with parents and youth in the area.

Organization Summary

YouthSports will be a private, non-profit youth sports program serving children, ages 6-14, in the Richmond Metro area. The program aims to promote youth sports participation, healthy development, and increase access to health care.

YouthSports has rented office space near the city cent park system. Outdoor sports will be played on public school and park property, while indoor sports will be played in public school gyms.

2.1 Start-up Summary

Start-up costs and initial financing are shown in the following tables and chart.

Start-up Funding:

Start-up Expenses to Fund: $342,000

Start-up Assets to Fund: $518,000

Total Funding Required: $860,000

Assets:

Non-cash Assets from Start-up: $250,000

Cash Requirements from Start-up: $268,000

Additional Cash Raised: $0

Cash Balance on Starting Date: $268,000

Total Assets: $518,000

Liabilities and Capital:

Liabilities:

Current Borrowing: $0

Long-term Liabilities: $0

Accounts Payable (Outstanding Bills): $0

Other Current Liabilities (interest-free): $0

Total Liabilities: $0

Capital:

Planned Investment:

JFSF: $430,000

Blue Shield/Blue Cross: $100,000

Templex Corporation: $25,000

A.I. Kaufman and Sons: $25,000

PriceRight Supermarkets: $80,000

Avion Computers: $50,000

The Richmond Mail: $50,000

Richmond Bank: $50,000

Rider Corporation: $50,000

Other: $0

Additional Investment Requirement: $0

Total Planned Investment: $860,000

Loss at Start-up (Start-up Expenses): ($342,000)

Total Capital: $518,000

Total Capital and Liabilities: $518,000

Total Funding: $860,000

Start-up Requirements:

Start-up Expenses:

Legal: $5,000

Stationery etc.: $5,000

Brochures: $20,000

Promotion: $100,000

Insurance: $10,000

Rent: $2,000

Research and Development: $0

Sport Equipment: $100,000

Office Equipment/Software: $100,000

Other: $0

Total Start-up Expenses: $342,000

Start-up Assets:

Cash Required: $268,000

Other Current Assets: $50,000

Long-term Assets: $200,000

Total Assets: $518,000

Total Requirements: $860,000

Services:

YouthSports will offer the following sports during the year:

– Flag Football, August-November.

– 1st/2nd Grade Basketball, October-December.

– 3rd-8th Grade Basketball, December-March.

– Spring Soccer, March-May.

– T-Ball/Softball/Baseball, May-July.

Market Analysis Summary:

There are 40,000 children in the Richmond Metro area between six to 14 years of age. The age group percentages break down as follows:

– 50% – Ages 6-8.

– 30% – Ages 9-11.

– 20% – Ages 12-14.

Currently, only 10% of 6 -11 year olds in the Richmond Metro area participate in organized sports. More importantly, only 5% of girls in that age group are involved in sports. The current age breakdown provides YouthSports with an excellent opportunity to impact half of our target group at the youngest ages. This will have a tremendous impact on the success of the program over the next five years.

It is also important to note that there are over 25,000 children in the Richmond Metro area between the ages of two to five. These children will be entering the YouthSports program within the next three years.

Market Segmentation:

The 2-5 and 6-8 age groups represent over 70% of the children that YouthSports will serve over the next three years. It is critical that the program is prepared to manage the influx of these young children.

Market Analysis

Strategy and Implementation Summary

YouthSports must take a proactive approach in promoting its program and implementing a strong fundraising program. To achieve these goals, two groups will oversee the program’s growth and development. A 12-member Program Services Group, comprising of community members, will provide oversight of service delivery and build community support. A 10-member Finance Group, consisting of Richmond business representatives, will oversee fiscal operations and fundraising activities.

The next step will be recruiting volunteer coaches and facility supervisors for each season, utilizing community churches, civic organizations, and the Richmond Police Department. YouthSports is also partnering with the Community Service Program of State University to recruit college students as coaches, who will receive university credits for their involvement.

Mobilizing a coaching/supervision base will enable YouthSports to reach the entire community with its message.

Streamlining the sign-up process will involve providing participation forms at schools and community markets, with collection kiosks available at each location.

5.1 Competitive Edge

YouthSports has a twofold competitive edge. First, it has the support of the community’s public resources, which will contribute to a successful sports program that positively impacts the area’s children. The school district is committed to promoting the sports program, with each school choosing a team name and allowing volunteer coaches to visit classrooms. The city park system has also played a crucial role by providing discounted sports equipment.

Second, local businesses are supporting YouthSports, recognizing the opportunity to make a real impact on the metro youth. The revitalization of Richmond’s urban center relies on improving the quality of life for metro residents, particularly the majority of children under the age of six. Businesses are eager to become sport and school team sponsors.

To develop effective business strategies, a SWOT analysis is recommended. Our free guide and template can assist you in performing a SWOT analysis.

5.2 Fundraising Strategy

YouthSports will focus its fundraising efforts on two groups: metro area parents and Richmond’s businesses. Success with both groups is essential for the program’s future.

Metro Area Parents: While sign-up fees will only cover 30% of operating costs, they are crucial for several reasons. Firstly, they create a sense of ownership in the program, fostering long-term community support. Secondly, the monetary commitment generates expectations of high-quality services, stimulating the program’s responsiveness to community needs. Lastly, the fees serve as an organizing tool to recruit volunteers who will work for the program as part of a child scholarship agreement.

5.2.1 Funding Forecast

Here is the funding forecast for the next three years.

Funding Forecast

Year 1 Year 2 Year 3

Funding

Sign-Up Fees $960,000 $1,100,000 $1,220,000

Business Sponsorships $560,000 $660,000 $760,000

Fundraising $120,000 $120,000 $120,000

Other $0 $0 $0

Total Funding $1,640,000 $1,880,000 $2,100,000

Direct Cost of Funding

Year 1 Year 2 Year 3

Sign-Up Fees $0 $0 $0

Business Sponsorships $12,000 $15,000 $18,000

Fundraising $12,000 $12,000 $12,000

Other $0 $0 $0

Subtotal Cost of Funding $24,000 $27,000 $30,000

Management Summary

YouthSports will establish a team to manage the program’s day-to-day operations.

6.1 Personnel Plan

The program team will consist of the following positions:

– Director

– Assistant Director

– Volunteer Coordinator

– Sponsorship/Fundraising Developer

– Facility Coordinator

– Coordinator of Game Officials

– Area Supervisors (3)

– Office Manager

– Clerical Staff (2)

Personnel Plan

Year 1 Year 2 Year 3

Director $36,000 $39,000 $42,000

Assistant Director $31,200 $34,000 $37,000

Volunteer Coordinator $30,000 $33,000 $36,000

Sponsorship/Fundraising Developer $33,600 $37,000 $40,000

Facility Coordinator $30,000 $33,000 $36,000

Coordinator of Game Officials $28,800 $31,000 $34,000

Area Supervisors (3) $72,000 $80,000 $90,000

Office Manager $30,000 $33,000 $36,000

Clerical Staff (2) $38,400 $41,000 $44,000

Total People 12 12 12

Total Payroll $330,000 $361,000 $395,000

Financial Plan

The following is the Financial Plan for YouthSports for three years.

7.1 Break-even Analysis

The following table and chart illustrate the Break-even Analysis for YouthSports.

Break-even Analysis:

Monthly Revenue Break-even: $140,548.

Assumptions:

– Average Percent Variable Cost: 1%.

– Estimated Monthly Fixed Cost: $138,492.

Projected Surplus or Deficit:

The program’s operation surplus or deficit for three years is as follows:

Surplus and Deficit:

Year 1 Year 2 Year 3

Funding: $1,640,000 $1,880,000 $2,100,000

Direct Cost: $24,000 $27,000 $30,000

Other Production Expenses: $0 $0 $0

Total Direct Cost: $24,000 $27,000 $30,000

Gross Surplus: $1,616,000 $1,853,000 $2,070,000

Gross Surplus %: 98.54% 98.56% 98.57%

Expenses:

Payroll: $330,000 $361,000 $395,000

Sales and Marketing and Other Expenses: $1,196,000 $1,290,000 $1,445,000

Depreciation: $0 $0 $0

Leased Equipment: $0 $0 $0

Utilities: $2,400 $2,400 $2,400

Insurance: $60,000 $60,000 $60,000

Rent: $24,000 $24,000 $24,000

Payroll Taxes: $49,500 $54,150 $59,250

Other: $0 $0 $0

Total Operating Expenses: $1,661,900 $1,791,550 $1,985,650

Surplus Before Interest and Taxes: ($45,900) $61,450 $84,350

EBITDA: ($45,900) $61,450 $84,350

Interest Expense: $0 $0 $0

Taxes Incurred: $0 $0 $0

Net Surplus: ($45,900) $61,450 $84,350

Net Surplus/Funding: -2.80% 3.27% 4.02%

Projected Cash Flow:

The following is the Projected Cash Flow of the program’s operation for three years.

Pro Forma Cash Flow

Cash Received

Cash from Operations

Cash Funding

Subtotal Cash from Operations

Additional Cash Received

Sales Tax, VAT, HST/GST Received

New Current Borrowing

New Other Liabilities (interest-free)

New Long-term Liabilities

Sales of Other Current Assets

Sales of Long-term Assets

New Investment Received

Subtotal Cash Received

Expenditures

Expenditures from Operations

Cash Spending

Bill Payments

Subtotal Spent on Operations

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out

Principal Repayment of Current Borrowing

Other Liabilities Principal Repayment

Long-term Liabilities Principal Repayment

Purchase Other Current Assets

Purchase Long-term Assets

Dividends

Subtotal Cash Spent

Net Cash Flow

Cash Balance

Projected Balance Sheet

Pro Forma Balance Sheet

Assets

Current Assets

Cash

Other Current Assets

Total Current Assets

Long-term Assets

Long-term Assets

Accumulated Depreciation

Total Long-term Assets

Total Assets

Liabilities and Capital

Current Liabilities

Accounts Payable

Current Borrowing

Other Current Liabilities

Subtotal Current Liabilities

Long-term Liabilities

Total Liabilities

Paid-in Capital

Accumulated Surplus/Deficit

Surplus/Deficit

Total Capital

Total Liabilities and Capital

Net Worth

Standard Ratios

Ratio Analysis

Funding Growth

Percent of Total Assets

Other Current Assets

Total Current Assets

Long-term Assets

Total Assets

Current Liabilities

Long-term Liabilities

Total Liabilities

Net Worth

Percent of Funding

Funding

Gross Surplus

Selling, General & Administrative Expenses

Advertising Expenses

Surplus Before Interest and Taxes

Main Ratios

Current

Quick

Total Debt to Total Assets

Pre-tax Return on Net Worth

Pre-tax Return on Assets

Additional Ratios

Net Surplus Margin

Return on Equity

Activity Ratios

Accounts Payable Turnover

Payment Days

Total Asset Turnover

Debt Ratios

Debt to Net Worth

Current Liab. to Liab.

Liquidity Ratios

Net Working Capital

Interest Coverage

Additional Ratios

Assets to Funding

Current Debt/Total Assets

Acid Test

Funding/Net Worth

Dividend Payout

Appendix

Funding Forecast

Funding

Sign-Up Fees

Business Sponsorships

Fundraising

Other

Total Funding

Direct Cost of Funding

Sign-Up Fees

Business Sponsorships

Fundraising

Other

Subtotal Cost of Funding

Personnel Plan

Director: 0% – $3,000 (per month)

Assistant Director: 0% – $2,600 (per month)

Volunteer Coordinator: 0% – $2,500 (per month)

Sponsorship/Fundraising Developer: 0% – $2,800 (per month)

Facility Coordinator: 0% – $2,500 (per month)

Coordinator of Game Officials: 0% – $2,400 (per month)

Area Supervisors (3): 0% – $6,000 (per month)

Office Manager: 0% – $2,500 (per month)

Clerical Staff (2): 0% – $3,200 (per month)

Total People: 12

Total Payroll: $27,500

General Assumptions

Plan Month: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12

Current Interest Rate: 10.00%

Long-term Interest Rate: 10.00%

Tax Rate: 0.00%

Other: 0

Surplus and Deficit

Funding: $110,000, $110,000, $180,000, $180,000, $180,000, $180,000, $120,000, $130,000, $130,000, $120,000, $100,000, $100,000

Direct Cost: $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000

Other Production Expenses: $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0

Total Direct Cost: $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000

Gross Surplus: $108,000, $108,000, $178,000, $178,000, $178,000, $178,000, $118,000, $128,000, $128,000, $118,000, $98,000, $98,000

Gross Surplus %: 98.18%, 98.18%, 98.89%, 98.89%, 98.89%, 98.89%, 98.33%, 98.46%, 98.46%, 98.33%, 98.00%, 98.00%

Expenses

Payroll: $27,500, $27,500, $27,500, $27,500, $27,500, $27,500, $27,500, $27,500, $27,500, $27,500, $27,500, $27,500

Sales and Marketing and Other Expenses: $3,000, $73,000, $103,000, $103,000, $123,000, $123,000, $133,000, $133,000, $123,000, $73,000, $103,000, $103,000

Depreciation: $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0

Leased Equipment: $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0

Utilities: $200, $200, $200, $200, $200, $200, $200, $200, $200, $200, $200, $200

Insurance: $5,000, $5,000, $5,000, $5,000, $5,000, $5,000, $5,000, $5,000, $5,000, $5,000, $5,000, $5,000

Rent: $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000, $2,000

Payroll Taxes: 15% – $4,125, $4,125, $4,125, $4,125, $4,125, $4,125, $4,125, $4,125, $4,125, $4,125, $4,125, $4,125

Other: $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0

Total Operating Expenses: $41,825, $111,825, $141,825, $141,825, $161,825, $161,825, $171,825, $171,825, $161,825, $111,825, $141,825, $141,825

Surplus Before Interest and Taxes: $66,175, ($3,825), $36,175, $36,175, $16,175, $16,175, ($53,825), ($43,825), ($33,825), $6,175, ($43,825), ($43,825)

EBITDA: $66,175, ($3,825), $36,175, $36,175, $16,175, $16,175, ($53,825), ($43,825), ($33,825), $6,175, ($43,825), ($43,825)

Interest Expense: $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0

Taxes Incurred: $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0, $0

Net Surplus: $66,175, ($3,825), $36,175, $36,175, $16,175, $16,175, ($53,825), ($43,825), ($33,825), $6,175, ($43,825), ($43,825)

Net Surplus/Funding: 60.16%, -3.48%, 20.10%, 20.10%, 8.99%, 8.99%, -44.85%, -33.71%, -26.02%, 5.15%, -43.83%, -43.83%

Pro Forma Cash Flow

Cash Received

Cash from Operations

Cash Funding

Subtotal Cash from Operations

Additional Cash Received

Sales Tax, VAT, HST/GST Received

New Current Borrowing

New Other Liabilities (interest-free)

New Long-term Liabilities

Sales of Other Current Assets

Sales of Long-term Assets

New Investment Received

Subtotal Cash Received

Expenditures

Expenditures from Operations

Cash Spending

Bill Payments

Subtotal Spent on Operations

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out

Principal Repayment of Current Borrowing

Other Liabilities Principal Repayment

Long-term Liabilities Principal Repayment

Purchase Other Current Assets

Purchase Long-term Assets

Dividends

Subtotal Cash Spent

Net Cash Flow

Cash Balance

Pro Forma Balance Sheet

Assets

Starting Balances

Current Assets

Cash

Other Current Assets

Total Current Assets

Long-term Assets

Long-term Assets

Accumulated Depreciation

Total Long-term Assets

Total Assets

Liabilities and Capital

Current Liabilities

Accounts Payable

Current Borrowing

Other Current Liabilities

Subtotal Current Liabilities

Long-term Liabilities

Total Liabilities

Paid-in Capital

Accumulated Surplus/Deficit

Surplus/Deficit

Total Capital

Total Liabilities and Capital

Net Worth

Andrew Brooks

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