Edgebrook Adventures

Transcription

1 Edgebrook Adventures Business Plan Prepared by: Trina Date: February 27, 2011 Edgebrook Adventures 1/ 20

2 Table of Contents Executive Summary 3 Business Idea 4 What will the business do? 4 Who will pay the business to do it? 4 Why will they pay the business to do it? 4 Market Research 5 Target Market 5 Customer Segments 6 Industry Analysis 6 Competition 8 SWOT Analysis 9 Operations 10 Business Structure 10 Scheduling and Human Resources 10 Locations and Transportation 11 Furnishings, Equipment and Services 11 Product and Service Direct Costs 12 Marketing 14 Four P Analysis 14 Financial Forecast 17 Sales Plan 17 Start up Financing Month Financial Forecast 17 Risk 19 Commercial Risk 19 Property and Liability Risk 19 Action Plan 20 Edgebrook Adventures 2/ 20

3 Executive Summary Edgebrook Adventures is a sole proprietorship that will offer adventure hunts at the Edgebrook Museum and Art Gallery. The goal of Edgebrook Adventures is to provide a fun, interactive and educational experience for all participants. The adventure hunts will be ideal for families and can be customized for family special events or for organizations looking for an event tailored to their members or employees. Customers will pay for the hunts because they re a different kind of experience that s rewarding but affordably priced. The family target market includes families with children that reside in Edgebrook, which number approximately 10,000, and visiting families, which number 2,100 per year. The organizations target market includes the over 500 businesses and community groups in town. While Edgebrook Adventures has no direct competition, there is indirect competition for families and, to a smaller extent, businesses and community groups as well. Edgebrook Adventures is in the recreation and entertainment industry which is easy to enter but very competitive. The business will compete by offering a high value experience in the same price range as an outing to the movies. Edgebrook Adventures will be home based with all work done initially by the owner. The business s start up costs of just over $1,000 will be financed by a one year, 5% loan from the Edgebrook Credit Union. Marketing for Edgebrook Adventures will be web and print based. Print promotional materials will direct customers to the site and will be placed door to door, by direct mail, and through hotels and tourist information stands. The website will give customers the option to book and pay online. A promotional event with free adventure hunts downtown will take place on Edgebrook Day. The first year sales target is 63 public hunts, 24 custom hunts and 13 corporate hunts, which will generate revenue of $14,848. Total profit will be $6, The risks associated with Edgebrook Adventures can be mitigated by additional marketing, clear instructions on customer responsibilities, liability waivers and liability insurance. Edgebrook Adventures 3/ 20

4 Business Idea What will the business do? My business will offer one to three hour adventure hunts hosted by me on location in the Edgebrook Museum and Art Gallery. On the hunts, participants will find clues, solve riddles, and discover the answers to trivia questions in a race to fill out the clue sheet and complete the hunt. Participants can participate in their choice of scripted adventure hunts, such as The Mystery of the Edgebrook Museum, Who s Who in the Gallery, and The Great Edgebrook Artefact Escapade, and more scripts will be created as time goes on. In addition to scripted adventure hunts, I will offer customized hunts for birthday parties and corporate events. Who will pay the business to do it? Anyone looking for an activity that s interactive, fun and teaches about the history and culture of Edgebrook will pay for my adventure hunts. But most of the people who take part in my adventures will belong to one of two types of groups: families (both local families and visitors) or organizations (businesses and community groups). Custom adventures will be the perfect activity for events such as birthday parties for families, team building experiences for a business, or recreational experiences for the members of a community organization. Why will they pay the business to do it? My adventure hunts will get friends, family and co workers moving, laughing and having fun together in an interesting and challenging activity. Customers will pay for the hunts because they will be engaging and educational. They will build connections between participants and increase the connection they feel to Edgebrook. My service is unique in Edgebrook: no one offers an anything quite like it. Edgebrook Adventures 4/ 20

5 Market Research Target Market Location The location of my target market is the city of Edgebrook and also other places both in Ontario and outside of it, because a fair number of visitors and tourists come to Edgebrook, particularly in the summer. But because people who live outside of Edgebrook are only potential customers while they re in town, I will consider the location of my target market to be Edgebrook itself. Secondary Research In the 2006 Statistics Canada Census, Edgebrook s population was listed as 90,167. Of this, approximately 18,000 people are between the ages of 4 and 16 years old. Using Statistics Canada s average figure of 1.8 children/youth per household with children/youth living at home, there are about 10,000 families with children in my target market. Approximately 2,100 families with children come to Edgebrook as tourists each year according to the Edgebrook Chamber of Commerce. Therefore the total number of families in my target market is about 12,100. According to the Town of Edgebrook s website, there are 200 businesses in Edgebrook with 15 or more employees, and over 300 community groups. These are another target market totalling around 500. Primary Research I surveyed people at the Museum, Town Hall, Main Library, and the Edgebrook Mall. The results showed that about 45% of the population would be interested in an adventure hunt organized by my business. If I apply this percentage to the numbers I calculated in my secondary research, it shows that my target market is about 5,445 families and 225 companies or community groups. Edgebrook Adventures 5/ 20

6 Customer Segments My target markets are families with children and organizations. These can be segmented as follows: Families can be segmented into resident families and visiting families. Resident families represent about 82% of this target market and visitors represent about 18%. Both segments are looking for the same thing, which is a fun and educational time together. However, the clues in my hunt have to make sense to visitors from out of town, not just residents. Organizations can be divided into corporations, which make up about 60% of this target market, and community organizations, which make up about 40%. There are some differences between what these groups want, for example, a business may be looking for more of a team building activity, while a community organization may want an activity that s more recreational. Both groups are willing to pay more and will also bring more participants together for an event. Industry Analysis My business is in the recreation and entertainment industry. At the moment, this industry is growing and no major change is expected. There are few barriers to entry to this industry. The price of entertainment is constantly rising. However, the family part of my target market is made up of value conscious customers, so offering a high quality service at a relatively low price should give me an advantage. The industry has cycles. For example, both families and tourists buy more recreation and entertainment products and services in the summer because school is out and the weather is nice for travelling and doing things. On the other hand, for companies and community groups, summer is usually a fairly quiet time, but the holidays and the lead up to summer are often busy times for events and activities. I can take advantage of these cycles to keep myself busy at different times of the year. Edgebrook Adventures 6/ 20

7 Customer Characteristics Demographics Age Youth: 7 to 19 Adults/parents: 30 to 65+ Income Household median income for families is $65,000. Marital status Family status Ethnicity Language Gender Education Youth: Single Adults/parents: Married or single Youth: Members of families Adults/parents: in the family target market, all have families. Not the case in the organization target market. All types 85% English, 6% French, 9% other Males and females Youth: Primary and secondary school. Adults/parents: 28% have high school diplomas, 42% have college and/or trade certificates and 20% have university degrees. 10% have nothing at all. Geographic Where do customers live? What types of dwellings? Edgebrook, Ontario All dwellings, but home owners are a good group to focus on as large numbers of them have children. Psychographics Lifestyle descriptors Interests related to this product Youth: Active in sports, school groups and school Adults/parents: Busy with work, family and other commitments. Want to promote an active, educational lifestyle for their children and take part where they can. In the organization market, adults are also interested in self development. Youth: science, art, competition Adults/parents: Education, community involvement Cultural Interests Music preferences Youth: Pop, top 40, punk, hip hop, rock, country Parents: Pop, jazz, country, classical, rock, folk Edgebrook Adventures 7/ 20

8 Reading preferences Food/dining choices Entertainment choices Internet choices Clubs Other Interests Youth: Sports, fashion and trend magazines, young adult books Parents: Edgebrook Post newspaper, many magazines and books Youth: Fast food, pizza, snack food, etc. Parents/Adult buyers: Many varieties Youth: Movies, video games, books, games, sports, television, internet Adults: Many varieties including museums and art galleries Youth: Facebook, Youtube, Myspace, Twitter and other social networking sites Adults: LinkedIn, newspaper sites, weather sites, Facebook, community information sites, etc. Youth: Sports teams, Scouts and school groups Parents & adult buyers: Historical and/or community clubs and groups. Artistic clubs as well. Adults: Interest in local history, culture, art and science. Competition Since no companies are offering adventure hunts like mine in Edgebrook, I don t have direct competition. But, since people only have a certain amount of money to spend on entertainment and there are many alternatives, I have indirect competition. For companies and community groups, competing activities are things like golf tournaments, ski days, boat cruises, and professional development activities held at clients workplaces or off site facilities. These events are expensive and some, like golf and skiing, require experience and can therefore exclude some members. There is therefore an open opportunity for my service in this market. Going to a movie is an example of indirect competitors in the family market. Going to the movies for a matinée costs around $7 for adults and $5 for children, which is less expensive than an adventure hunt, but it s non interactive and, in most cases, non learning. And, if you factor in buying food at the concession stand, full price for a matinée is $12 to $15 for an adult and $10 to $12 for children. Going to a Museum or Art Gallery for its own sake (i.e. not on an adventure hunt) is another option for some customers. Prices vary between $5 and $5.50, depending on the size of the group. But children Edgebrook Adventures 8/ 20

9 and even some adults may get bored during a regular visit to a museum or gallery, whereas my activities make visits to these facilities much more engaging. In general, to compete against these indirect competitors, my adventure hunts will have to be unique interactive learning experiences that deliver more value than the alternatives. SWOT Analysis Strengths I m good at organizing activities I know about Edgebrook and its history I know people who can help with my business I know how to use social media for promotion Opportunities I have no direct competition Customers want new interactive experiences The Museum and Art Gallery want more visitors and may support my business I m good at problem solving Weaknesses I don t know how to do book keeping I don t know too much about marketing I don t have start up money No experience running a business or working with customers Threats The hunts may not interest some participants Someone could be injured on a hunt The indirect competition is well established I could lose the privilege of operating in the Museum or Gallery if a customer damages an exhibit Edgebrook Adventures 9/ 20

10 Operations Business Structure My business will be a sole proprietorship, registered in Ontario. As a sole proprietor, I will avoid incorporation fees that would raise the cost of starting my business. I will take precautions with participants and have insurance in case any participants get injured on my adventure hunts. I ll keep the business s profits, but at the same time, any debts will be mine, so I ll work to keep these under control. Business Structure Costs Costs Item Notes Start up Monthly Annual Business Registration $ Business Name Search $ 8.00 Totals $ Scheduling and Human Resources During the school year, I will only do adventure hunts on weekends. Tuesday to Thursday, I will work in the evening promoting, scheduling and planning the hunts. When summer holidays begin in late June, I ll work Tuesday to Saturday, 9am to 4pm. When I m not holding adventure hunts, I ll be working on marketing, public relations, bringing in sales from corporate clients and on general administration. In September, I ll go back to my school year schedule. Early in the year, I ll also be designing the adventure hunts (researching, creating clues and questions, developing scripts, etc.), building the website and conducting some adventure hunts too. After some adventure hunts are planned and the website s launched, I ll search for customers and start conducting adventure hunts. I ll be doing all this myself except for the website, which a friend has agreed to help me build for free. If my business starts to grow really quickly, I may hire someone to help me run adventure hunts. I don t think this will happen at first. Edgebrook Adventures 10/ 20

11 Locations and Transportation All my sales will be arranged online, through or by phone, so I don t need a retail location. I do need office space, and my mom has agreed to let me use the spare bedroom for this. Because adventure hunt location costs are variable costs, I ve included them below. Since I ll be using my bicycle for transportation around Edgebrook, and customers will travel to the Museum or Art Gallery on their own, I have no transportation costs. Furnishings, Equipment and Services I will need a computer of my own so I will buy one second hand for $500. A friend has offered me a nearly new printer with ink for $60. I will have internet for free thanks to my family s home internet service. I also need a cell phone service that includes voice mail so that I can have a professionalsounding voice mail greeting for customers. This will cost me $150 up front and $30 a month afterward. I will get general liability insurance to prevent being held responsible for accidents on an adventure hunt. Insurance will be $75 a month. A friend has agreed to build my website for free and teach me the basics of how to maintain and improve a website so that I can manage it myself. My neighbour who is an accountant has agreed to help me complete my taxes for free in April. Furnishings, Supply and Utility Costs Costs Item Notes Start up Monthly Annual Cell Phone $ $30.00 Totals $ $30.00 Equipment Costs Costs Item Notes Start up Monthly Annual Printer Will buy used $60.00 Computer Second hand $ Totals $ Edgebrook Adventures 11/ 20

12 Professional Services Costs Costs Item Notes Start up Monthly Annual General Liability Insurance $75.00 Totals $75.00 Product and Service Direct Costs Admission to the Museum or Art Gallery costs $5.50 per person, but in groups of 10 or more, the price per person is $5. Clue sheets will be printed from my computer, and after every sale, I will save some money for new paper and ink cartridges, which I will buy at a local office supply store. For children, I have also factored in the cost of some inexpensive toys from the museum gift shop, which I am obtaining at a discount. Since corporate hunts will not have children participating, the cost of the toys isn t in their fees. Product/Service A Component Costs Costs Item Cost per Item Quantity per Unit of Product/Service Subtotal, this Item Clue Sheet $ $ 0.80 Admission $ $ Toys for children $ $ 2.80 Totals $ Product/Service B Component Costs Costs Item Cost per Item Quantity per Unit of Product/Service Subtotal, this Item Clue Sheet $ $ 1.00 Admission $ $50.00 Toys for children $ $ 4.00 Totals $ Start up Cost Start up Cost Edgebrook Adventures 12/ 20

13 Product/Service C Component Costs Costs Item Cost per Item Quantity per Unit of Product/Service Subtotal, this Item Clue Sheet $ $ 2.40 Admission $ $80.00 Totals $ Start up Cost Edgebrook Adventures 13/ 20

14 Marketing Four P Analysis Product or Service My business offers fun, educational adventure. Participants will find clues, solve riddles and complete challenges in a race to complete the answers on a clue sheet. There are standard adventure hunts open to the public and custom adventure hunts for families, businesses and community groups. The greatest strength of my business is uniqueness. Nobody offers an experience quite like mine. Also, by shedding new light on the history of Edgebrook and fostering deeper a connection with the town both for residents and visitors, the value of one of my adventure hunts is lasting. My marketing copy will highlight the uniqueness of my service and focus on the fun and learning participants receive. The marketing copy will be tailored to the adults who will buy the service on behalf of their children, friends and co workers. Place A physical retail space, like a store, isn t necessary for my business, but I will have a website where customers can book and pay for their hunts. As my analysis of customer characteristics showed, the people in my target markets are internet users and since it s affordable, this is a good place to conduct my retail operations. A website can provide customers the details and dates of upcoming hunts, photos from past hunts and customer testimonials, which will increase the credibility of my business. Promotion, Part 1: Value Statement, Business Name and Slogan After participants finish their adventure hunt, I hope they will be both fulfilled and have learned something about the town of Edgebrook. I m planning to call my business Edgebrook Adventures to ensure what I do and where I do it is clear to the customer. Since I m doing something new, it s better to keep the name self explanatory. The names for my hunts are also self explanatory. My slogan is Engaging adventure for everyone, which expresses the core of what Edgebrook Adventures offers. Edgebrook Adventures 14/ 20

15 Value Statement Business Name Business Slogan Product/Service 1 Name Product/Service 2 Name Product/Service 3 Name I will provide fun, engaging and educational adventure hunts to family and group participants. The hunts will be a unique entertainment alternative that challenges participants and increases the connection they feel to the town of Edgebrook. Edgebrook Adventures Engaging adventure for everyone. Public Hunt Custom Hunt Corporate Hunt Promotion, Part 2: Advertising, Publicity and Promotional Events I will primarily use my website to promote Edgebrook Adventures. The site will have descriptions of what I offer, reviews, links to newspaper articles about Edgebrook Adventures and ways of contacting me for information and for feedback. My website must be well made so people take Edgebrook Adventures seriously enough to book an adventure hunt. Web domain registration will be $35. I ll have ads running online on both a search engine and a social networking site for $40 a month. I will use PayPal for $10 a month to process credit card transactions on my website. To increase traffic to my website, I will contact other Edgebrook related websites and ask them to post links. I ll also print brochures and business cards to place in locations like the town hall, hotels, the community centre and the tourist information booth. I will start attracting corporate clients once I ve done a few adventure hunts. I will send a summary of my business, a brochure and a customer review to the Edgebrook Post which will hopefully profile me as a young entrepreneur. Since my customers read this paper, it should help my promotion a lot. I ll also contact groups and companies in Edgebrook directly to pitch adventure hunts. I will hold a promotional event on the third Saturday in July, which is Edgebrook Day, a day to celebrate what the town has to offer. I will take 60 people on an outdoor adventure hunt that day for free. At the end, I will make my sales pitch for the adventure hunts at the Museum and Art Gallery and give everyone a pamphlet about Edgebrook Adventures. Edgebrook Adventures 15/ 20

16 The cost of the Edgebrook day event is: Registration $ Clue sheets, pencils, brochures, etc. $ Total $ The costs of my promotional activities are outlined below. Advertising and Promotional Event Costs Advertising and Promotional Event Costs Costs Item Notes Start up Monthly Annual Domain registration $ Brochures and business cards $ PayPal $10.00 Postage Costs $ July Edgebrook Day event Costs listed above $ Internet Advertising $40.00 Totals $ $50.00 $ Price My pricing strategy is to offer value but keep it affordable. I surveyed individuals and asked how much they thought an adventure hunt like mine should cost, and the consensus was that $10 $15 per person was reasonable. My prices will be $96 for a public hunt (8 people paying $12 each), $150 for a custom hunt (10 people paying $15 each) and $400 corporate hunt (16 people paying $25 each). The public hunts are the lowest cost because they follow a pre written adventure hunt script that requires little preparation. The custom hunts require some extra work, so the price is higher. The corporate hunts are priced highest because I ll be doing the most planning and preparation for their hunts to take advantage of the fact that businesses and community organisations have the resources to pay for a higher quality event. Product/Service Name Price Public Hunt $96 Custom Hunt $150 Corporate Hunt $400 Edgebrook Adventures 16/ 20

17 Financial Forecast Sales Plan I forecast holding 63 public hunts, 24 custom hunts and 13 corporate hunts over the year. These sales figures represent 1.6% of the families and 5.8% of the organizations in Edgebrook. The sales targets are higher for organizations because there s less competition for these groups. The January to May period is the peak time for the Corporate Hunts because this is when companies and community groups normally hold events. Because I ll be establishing myself in January, I don t foresee many sales to organizations then. The family target market has holidays from the end of June to the end of August, therefore most of my business for the public and custom hunts will happen during this time. My total forecast sales will be $6,480 for Corporate Hunts, $2,520 for Custom Hunts and $9,840 for Public Hunts, making my total sales for the year $18,840. Start up Financing I need $1, for my start up costs. I can get a loan from my credit union for this money if my mom co signs it. The terms are 5% interest over one year which will be $90.13 in interest payments each month. $275 of the loan will be used to get marketing materials and set up my website, and $710 will pay for furnishings and equipment. The business structure fees will be $ Month Financial Forecast My variable costs for the year come to a total of $9,237.30, which leaves me with gross profit of $9, This is a good figure, because I ll have money to pay for my fixed costs and some profit. Since I m selling more than one product, I can t calculate my break even point. My total profit for the year will be $6, I will use about $2,000 to keep Edgebrook Adventures going or even use it to start a different business at the end of the year. As for the rest of the money, I will save most of it for my postsecondary education and use some as spending money too. Edgebrook Adventures 17/ 20

18 Financial Forecast Table Units Sold Annual Total January February March April May June July August September October November December Public Hunt Custom Hunt Corporate Hunt Revenue Price Public Hunt $96.00 $ $ $ $ $ $ $1, $1, $ $ $ $ Custom Hunt $ $ $ $ $ $ $ $ $ $ $ $ $ Corporate Hunt $ $ $ $ $ $ $ $0.00 $0.00 $ $ $ $1, Subtotal, Revenue $ $ $1, $ $ $ $2, $2, $ $ $1, $2, Variable Costs Unit Cost Start up Public Hunt $47.60 $95.20 $95.20 $ $95.20 $ $ $ $ $ $95.20 $95.20 $ Custom Hunt $55.00 $55.00 $55.00 $ $55.00 $55.00 $55.00 $ $ $55.00 $55.00 $55.00 $ Corporate Hunt $82.50 $82.50 $82.50 $82.50 $82.50 $82.50 $82.50 $0.00 $0.00 $82.50 $82.50 $ $ Subtotal, Variable Costs $ $ $ $ $ $ $ $ $ $ $ $ Gross Profit $ $ $ $ $ $ $1, $1, $ $ $ $1, Fixed Costs Start up Ownership Structure $68.00 Human Resources Location and Transportation Furnishings, Equip t & Svcs $ $ $ $ $ $ $ $ $ $ $ $ $ Marketing Costs $ $50.00 $50.00 $50.00 $50.00 $50.00 $50.00 $ $50.00 $50.00 $50.00 $50.00 $50.00 Start up Financing Start up funds required $1, Interest rate 5.00% Term (1,2 or 3 years) 1 Payments: Start up Financing $90.13 $90.13 $90.13 $90.13 $90.13 $90.13 $90.13 $90.13 $90.13 $90.13 $90.13 $90.13 Subtotal Fixed Costs $ $ $ $ $ $ $ $ $ $ $ $ Monthly Profit $ $ $ $ $ $ $ $ $ $ $ $1, Total Annual Profit $6, Business Plan Edgebrook Adventures Page 18 of 20

19 Risk Commercial Risk The commercial risks I have identified are that demand ends up being lower than expected or that, for some reason, I end up losing access to the Art Gallery or Museum for my hunts. My marketing plan will protect me from demand being too low and I will adjust it if it proves to be not enough. Before each adventure hunt I will brief participants on how to be safe and that they still need to abide by the rules of the museum or art gallery while they are on the adventure hunt. Commercial Risk Likelihood Impact Mitigation Plan Demand lower than expected Medium High Losing access to the Art Gallery and/or Museum Medium High Market directly to families. Advertise in neighbouring towns. Get more publicity. Hold adventure hunts in other places or look into holding a summer day camp for kids. Brief customers on safety and the rules of the museum and gallery before each adventure hunt (i.e., no running, no touching exhibits, etc.). Have insurance in case of damage. Hold adventure hunts outdoors or in another location, such as City Hall. Property and Liability Risk There is no significant risk to my business property. I m exposed to liability risks that include being held responsible if a customer is injured on an adventure hunt or if an exhibit is damaged. Property and Liability Risk Likelihood Impact Mitigation Plan Being held responsible for an accident involving a customer Low High Brief customers on safety when adventure hunts begin Have customers sign a liability waiver. Inspect museum and gallery regularly to be aware of any hazards. Have general liability insurance. Remind customers of their responsibilities while in the museum/gallery before the start of hunts. Have customers sign a waiver stating they are responsible for any damage they cause. End a hunt early if customers are being unruly and risking damage to the exhibits. Have general liability insurance. A customer damages an exhibit at the Museum or Art Gallery Medium High Business Plan Edgebrook Adventures 19/ 20

20 Action Plan I will first register Edgebrook Adventures. Next, I will open a business bank account at the Edgebrook Credit Union and deposit my start up loan. As I m writing the final copies of the scripts for the public hunts, I ll also begin work on my website and create my promotional brochures and business cards. When these preparations are done, I will contact families I know who will be interested in the Adventure Hunts as well as the corporate clients and community groups of Edgebrook. While I m contacting these people directly, I ll also start my general advertising by sending brochures to tourist information kiosks and other places and also send a press release to the newspaper. By this point, customers should be booking hunts and I ll be able to start delivering them. Word of mouth advertising will begin at this point, supported by my website which provides more information for customers. After a year, I will have a large portfolio of adventure hunt scripts, which means I will be in good position to hire someone to help with my scripted public hunts. This employee would be paid per hunt while I do administration, marketing and development of new public and custom hunt scripts. If this employee shows ability and skill with public hunts, I might even let them run custom hunts and corporate hunts while I concentrate on growing Edgebrook Adventures. In five years, I d like to have two employees running adventure hunts full time and two others working part time. At this point, I hope to begin looking for options to expand to other venues in Edgebrook and possibly other cities. This would allow me to travel to many places in Ontario which is something I ve always wanted to do. Business Plan Edgebrook Adventures 20/ 20