Elite Personal Training

Critical Issues
Immediate cash flow problems even with the banks loan, Menard and Craciun do not
have enough money to purchase all the equipment necessary for their gym. Furthermore, if
they are unable to transfer their clients over from Body Worx, they will not have the cash
flows available to continue operations.
Competition there are already many, well-established competitors in London. Being able
to differentiate themselves and capture an acceptable cliental base will be very difficult.

Analysis
Current Situation
Martin Menard and Mirella Craciun are planning on leaving their current place of employment,
Body Worx to start their own personal training facility, Elite Personal Training in a niche
market. They plan to rent a small facility where they will renovate the space into two individual
gyms, allowing them to train two clients at a time. Offering the clients their own personal gym,
instead of training in a crowded facility, is Martin and Mirellas way to try and differentiating
themselves in a very competitive and saturated market. London, Ontario has a wide range and
variety of fitness centre, with many offering personal training services. For Elite to be successful
they will need to sell their one-on-one, high end, training experience and capture a small portion
of the existing market.

Competitor Analysis
GoodLife, The Athletic Club
It is a company which is well established. When compare with Elite, consumers will have more
confidence in a company with multiple locations. The gym is available to customers to exercise
on their own at anytime without restrictions. The pricing structure for personal training is lower
than our proposed price of $60 per hour personal training (exhibits ###). Their locations are
spread throughout London, and it is convenience for user to exercise at any GoodLife locations,
which in contrast position Elite as inconvenience for users outside of the same area. Users have
to share the facility with other users and thus have little to no personal privacy. Also, the
qualities of the trainers are questionable due to the lack of certifications on some of them.

YMCA
It is a fitness and recreation centre where a variety of fitness classes are available such as boot
camps, yoga and martial arts1. Looking at Exhibit __, they price discriminate and have cheaper
rates for different groups of individuals hence having the ability to attract price sensitive
customers. However, the facilities of those gyms are small in size and are limited to operation
hours of each individual location. According the website, the trainers are usually uncertified and
with limited experience.
Independent Personal Trainers
Both Menard and Craciuns current place of employment will be a direct competitor to Elite as
their business concept is from Body Worx. A similar or lower pricing structure will be needed to
help migrate clients from Body Worx clients to Elite. Other competitors such as Velocity provide
high end training equipments which will satisfy professional athletes at a higher price.
Consumers looking for this type of training are often values the personal one-on-on experience
with the trainer.

Market Analysis
Target Market
Business Professionals will be our main target market. They have higher than average income to
support their leisure activities2. Students who work in a part-time schedule will have to pay $480
up front, which will be considered a major portion of their disposable income ($40/section x 48
sections x 25%=$480).
Advertising Mix
Base on our research and analysis, a web page is the main media for advertisement for our
company. Business professional like to have details information to help with their decision
making process. So a website will serve that propose of having company information accessible
at all times. We will also suggest billboards in downtown area. The breakeven for a billboard
only requires one person to purchase one 48 sections packages per month (refer to exhibits _).

Criteria
Recommendations must meet the following criteria:

Maintain a positive cash flow

Pay the initial setup cost $48,777 by the first year
Provide enough profit for owners to have a salary of $60,000 a year ($5,000 x 12months)
Alternatives
Do not start business
Martin and Mirella could choose to not start their own business. They currently have a very
strong client base with Body Worx and are therefore able to work consistent hours each week.
Starting Elite Personal Training would put them into a very competitive market where it is very
1
2

http://www.ymcawo.ca/cby_groupfit.html
http://www.canadavisa.com/canadian-salary-survey.html

difficult to differentiate yourself. Exhibit ## analysis shows that this market already has
established competitors and the variety of services they offer to the people of London, Ontario. If
they are unable to overcome this competition they will be forfeiting their current income for a
high risk, low return investment. According to their estimates, which can be seen in Exhibit##,
their first year of operations will suffer declining revenues throughout the year. If they cannot
secure new clients in year two their profits may not cover what they are currently making at
Body Worx (exhibits ##).
Wait till have enough money before commencing
Between Mirellas $14,000 personal investment and the bank loan of $24,000, Elite does not
have enough money to pay for the start-up costs of opening their own personal training facility,
as shown in Exhibit ###. By postponing their venture and staying employed at Body Worx, they
can accumulate a higher initial personal investment, which will minimize the risk of starting this
business. However, by waiting they are allowing current competitors and possible new entrants
to capture more of the market share. Additionally, they are giving up the potential profits of
operating their own business.
Start the business (Lease finance/ Renting)
Through our analysis, the company will not have enough initial cash flow to start the business.
However, there are a few options that we have established to overcome those obstacles.

Financing the equipment: It is not necessary for the company to pay for the equipment
costs at the point of purchase. The option of financing can spread the payments over the
course of the year when the first month is critical for the company (exhibits or footnote
for the financing info). Without financing, the company will have cash flow problem at
the beginning of first year operation. With financing, the company will have positive cash
flow (exhibits ##).

Renting credit card machine: This method will allow the company to avoid the $5000
deposit for the first 6 months with a rental fee of $29 per month (matts website link).
This will further minimize the cash flow problem at the beginning of operation3.

Starting the business early before the operation date is important. Before the opening day
in October, preparations such as renovations, financing the initial equipment, and renting
the credit card machine should be done before hand.

Expansion for Proposed 3rd Gym

While renovating the conference room into a third gym is not necessary immediately, once
Elites client numbers have grown and they can afford to have a third trainer working out of their
facility, expansion will allow them to continue growing their business. Based on our capacity
projections in Exhibit ##, we will need to open gym three by June 2007. They will be able to
hire another trainer at $15 per hour and continue bringing in new customers.
3

http://www.canadacardprocessing.com/merchant-account/dial-up-debit-machine/

Recommendations

Start preparation in September 2005; open their new gym in October 2005.

Target the professional as their main clients with mixed advertising strategies.

Hire another trainer by Jun 2006 and expend into Gym 3.

Exhibits 1: Cash flow statement - Forcast

Cash flow statement - Forcast
Inflows

Sep-05
Oct-05
Nov-05
Dec-05
Jan-06
Feb-06
Mar-06
Apr-06
May-06
Jun-06
Jul-06
Aug-06
Sep-06
Oct-06
Nov-06
Dec-06
Jan-07
Feb-07
Mar-07
Apr-07
May-07
Jun-07
Jul-07
Aug-07
$ 14,000.00
$ 24,000.00
$
$ 16,560.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 12,960.00 $ 15,840.00 $ 18,720.00 $ 21,600.00 $ 24,480.00 $ 27,360.00 $ 30,240.00 $ 33,120.00 $ 36,000.00 $ 38,880.00 $ 41,760.00

Initial Investment
Bank Loan
Cash Inflows
Other Financing
Return of Deposit

$ 5,000.00

Total Inflows
Outflows

$ 38,000.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 15,080.00 $ 12,960.00 $ 15,840.00 $ 18,720.00 $ 21,600.00 $ 24,480.00 $ 27,360.00 $ 30,240.00 $ 33,120.00 $ 36,000.00 $ 38,880.00 $ 41,760.00
Fixed
Initial Equipment
Loan Payments
Rent
Deposit on CC Machine
Alarm System
Annual Insurance
Management Salary
Cleaning
Expansion
Tax Bill

$ 48,777.00
$ 586.00
$ 3,353.00
$ 5,000.00
$
50.00
$ 1,619.00
$ 5,000.00
$ 240.00
$
$
-

Varitable
Cards
Water
Parking
Facility
Extra Wages

$
$
$

Total Outflows
Net Cash
Cash Balance

$ 584.21 $ 582.42 $ 580.63 $ 578.83 $ 577.04 $ 575.25 $ 573.46 $ 571.67 $ 569.88 $ 568.08 $ 566.29 $ 564.50 $ 562.71 $ 560.92 $ 559.13 $
$ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $

557.33 $
3,353.00 $

$
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
$ 1,619.00
$ 1,619.00
$ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $
$ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
6,400.00
-

$
$
$
$

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
-

18.00
36.00
720.00
306.00
600.00

20.40
40.80
816.00
346.80
1,320.00

22.80
45.60
912.00
387.60
2,040.00

25.20
50.40
1,008.00
428.40
2,760.00

27.60
55.20
1,104.00
469.20
3,480.00

30.00
60.00
1,200.00
510.00
4,200.00

32.40
64.80
1,296.00
550.80
4,920.00

34.80
69.60
1,392.00
591.60
5,640.00

$
$
$
$

13.80
27.60
552.00
234.60
-

$
$
$
$

13.80
27.60
552.00
234.60
-

$
$
$
$

13.80
27.60
552.00
234.60
-

$
$
$
$

13.80
27.60
552.00
234.60
-

$
$
$
$

12.00
24.00
480.00
204.00
-

$
$
$
$

12.00
24.00
480.00
204.00
-

$
$
$
$

12.00
24.00
480.00
204.00
-

$
$
$
$

12.00
24.00
480.00
204.00
-

$
$
$
$

8.40
16.80
336.00
142.80
-

$
$
$
$

8.40
16.80
336.00
142.80
-

$
$
$
$

8.40
16.80
336.00
142.80
-

$
$
$
$

8.40
16.80
336.00
142.80
-

$
$
$
$

10.80
21.60
432.00
183.60
-

$
$
$
$

13.20
26.40
528.00
224.40
-

$
$
$
$

15.60
31.20
624.00
265.20
-

$
$
$
$

50.00 $

$
$
$

555.54 $
3,353.00 $
50.00 $

$
$
$

553.75 $
3,353.00 $
50.00 $

$
$
$

551.96 $
3,353.00 $
50.00 $

$
$
$

550.17 $
3,353.00 $
50.00 $

$
$
$

548.38 $
3,353.00 $
50.00 $

$
$
$

546.58 $
3,353.00 $
50.00 $

$
$
$

544.79
3,353.00
50.00

$ 64,625.00 $ 11,674.21 $ 10,053.42 $ 10,051.63 $ 10,049.83 $ 9,940.04 $ 9,938.25 $ 9,936.46 $ 9,934.67 $ 9,716.88 $ 9,715.08 $ 9,713.29 $ 9,711.50 $ 11,472.71 $ 9,995.92 $ 10,138.13 $ 10,880.33 $ 11,742.54 $ 12,604.75 $ 13,466.96 $ 20,729.17 $ 15,191.38 $ 16,053.58 $ 16,915.79
-$ 26,625.00 $ 4,885.79 $ 6,506.58 $ 6,508.38 $ 6,510.17 $ 4,459.96 $ 4,461.75 $ 4,463.54 $ 4,465.33 $ 363.13 $ 364.92 $ 366.71 $ 5,368.50 $ 1,487.29 $ 5,844.08 $ 8,581.88 $ 10,719.67 $ 12,737.46 $ 14,755.25 $ 16,773.04 $ 12,390.83 $ 20,808.63 $ 22,826.42 $ 24,844.21
-$ 26,625.00 -$ 21,739.21 -$ 15,232.63 -$ 8,724.25 -$ 2,214.08 $ 2,245.88 $ 6,707.63 $ 11,171.17 $ 15,636.50 $ 15,999.63 $ 16,364.54 $ 16,731.25 $ 22,099.75 $ 23,587.04 $ 29,431.13 $ 38,013.00 $ 48,732.67 $ 61,470.13 $ 76,225.38 $ 92,998.42 $ 105,389.25 $ 126,197.88 $ 149,024.29 $ 173,868.50

Exhibits 2: Cash Flow - Alternatives Implemented

Cash Flow - Alternatives Implimented
Inflows

Initial Investment
Bank Loan
Cash Inflows
Other Financing
Return of Deposit

Total Inflows
Outflows

Total Outflows
Net Cash
Cash Balance

Sep-05
Oct-05
Nov-05
Dec-05
Jan-06
Feb-06
Mar-06
Apr-06
May-06
Jun-06
Jul-06
Aug-06
Sep-06
Oct-06
Nov-06
Dec-06
Jan-07
Feb-07
Mar-07
Apr-07
May-07
Jun-07
Jul-07
Aug-07
$ 14,000.00
$ 24,000.00
$
$ 16,560.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 12,960.00 $ 15,840.00 $ 18,720.00 $ 21,600.00 $ 24,480.00 $ 27,360.00 $ 30,240.00 $ 33,120.00 $ 36,000.00 $ 38,880.00 $ 41,760.00
$

5,000.00

$ 38,000.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 12,960.00 $ 15,840.00 $ 18,720.00 $ 21,600.00 $ 24,480.00 $ 32,360.00 $ 30,240.00 $ 33,120.00 $ 36,000.00 $ 38,880.00 $ 41,760.00
Fixed
Initial Equipment
Loan Payments
Rent
Deposit on CC Machine
Credit Card Machine Rental
Alarm System
Annual Insurance
Management Salary
Cleaning
Expansion
Tax Bill

$ 23,077.00
$ 586.00 $ 584.21 $ 582.42 $ 580.63 $ 578.83 $ 577.04 $ 575.25
$ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00
$ 5,000.00
$
29.99 $
29.99 $
29.99 $
29.99 $
29.99 $
29.99
$
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00
$ 1,619.00
$
$ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00
$
$ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00
$
$
$
$
$
$
$
$
$
$
$
$
$
$
-

$ 25,700.00
$ 573.46 $ 571.67 $ 569.88 $ 568.08 $ 566.29 $ 564.50 $ 562.71 $ 560.92 $ 559.13 $
$ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $

Varitable
Cards
Water
Parking
Facility
Extra Wages

$
$
$
$
$

$
$
$
$
$

$
$
$
$
$

13.80
27.60
552.00
234.60
-

$
$
$
$
$

13.80
27.60
552.00
234.60
-

$
$
$
$
$

13.80
27.60
552.00
234.60
-

$
$
$
$
$

13.80
27.60
552.00
234.60
-

$
$
$
$
$

12.00
24.00
480.00
204.00
-

$
$
$
$
$

12.00
24.00
480.00
204.00
-

50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
$ 1,619.00
$ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $
$ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $
$
$
$
$
$
$
$
$
$
$
$ 2,819.45 $
$
$
$
$
$
$
$
$

12.00
24.00
480.00
204.00
-

$
$
$
$
$

12.00
24.00
480.00
204.00
-

$
$
$
$
$

8.40
16.80
336.00
142.80
-

$
$
$
$
$

8.40
16.80
336.00
142.80
-

$
$
$
$
$

8.40
16.80
336.00
142.80
-

$
$
$
$
$

8.40
16.80
336.00
142.80
-

$
$
$
$
$

10.80
21.60
432.00
183.60
-

$
$
$
$
$

13.20
26.40
528.00
224.40
-

$
$
$
$
$

15.60
31.20
624.00
265.20
-

$
$
$
$
$

557.33 $
3,353.00 $

50.00 $

555.54 $
3,353.00 $

50.00 $

553.75 $
3,353.00 $

50.00 $

551.96 $
3,353.00 $

50.00 $

550.17 $
3,353.00 $

50.00 $

548.38 $
3,353.00 $

50.00 $

546.58 $
3,353.00 $

50.00 $

544.79
3,353.00

50.00

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
5,201.29

$
$
$
$

5,000.00
240.00
6,400.00
-

$
$
$
$

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
-

$
$
$
$

5,000.00
240.00
-

18.00
36.00
720.00
306.00
600.00

$
$
$
$
$

20.40
40.80
816.00
346.80
1,320.00

$
$
$
$
$

22.80
45.60
912.00
387.60
2,040.00

$
$
$
$
$

25.20
50.40
1,008.00
428.40
2,760.00

$
$
$
$
$

27.60
55.20
1,104.00
469.20
3,480.00

$
$
$
$
$

30.00
60.00
1,200.00
510.00
4,200.00

$
$
$
$
$

32.40
64.80
1,296.00
550.80
4,920.00

$
$
$
$
$

34.80
69.60
1,392.00
591.60
5,640.00

$ 28,714.99 $ 10,085.20 $ 10,083.41 $ 10,081.62 $ 10,079.82 $ 9,970.03 $ 14,938.25 $ 12,755.91 $ 9,934.67 $ 9,716.88 $ 9,715.08 $ 9,713.29 $ 37,030.50 $ 9,853.71 $ 9,995.92 $ 10,138.13 $ 10,880.33 $ 11,742.54 $ 12,604.75 $ 18,668.24 $ 20,729.17 $ 15,191.38 $ 16,053.58 $ 16,915.79
$ 9,285.01 $ 6,474.80 $ 6,476.59 $ 6,478.39 $ 6,480.18 $ 4,429.97 -$ 538.25 $ 1,644.09 $ 4,465.33 $ 363.13 $ 364.92 $ 366.71 -$ 26,950.50 $ 3,106.29 $ 5,844.08 $ 8,581.88 $ 10,719.67 $ 12,737.46 $ 19,755.25 $ 11,571.76 $ 12,390.83 $ 20,808.63 $ 22,826.42 $ 24,844.21
$ 9,285.01 $ 15,759.81 $ 22,236.41 $ 28,714.79 $ 35,194.97 $ 39,624.94 $ 39,086.69 $ 40,730.78 $ 45,196.11 $ 45,559.24 $ 45,924.15 $ 46,290.86 $ 19,340.36 $ 22,446.65 $ 28,290.74 $ 36,872.61 $ 47,592.28 $ 60,329.74 $ 80,084.99 $ 91,656.74 $ 104,047.57 $ 124,856.20 $ 147,682.62 $ 172,526.82

Exhibits 3: Income Statment

Income Statement
Revenues

Monthly Revenue

Expenses

Fixed
Loan Payments
Rent
Rent on CC Machine
Alarm System
Annual Insurance
Management Salary
Cleaning
Ammortization

$
$
$
$
$
$
$
$

Varitable
Cards
Water
Parking
Facility
Extra Wages
Total Expenses
Earnings Before Tax

$
$
$
$
$

Sep-05
Oct-05
Nov-05
Dec-05 Year End 2005
$ 16,560.00 $ 16,560.00 $ 16,560.00 $
49,680.00
$
$
$
86.00 $
84.21 $
82.42 $
80.63 $
333.25
3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $
13,412.00
29.99 $
29.99 $
29.99 $
29.99 $
119.96
50.00 $
50.00 $
50.00 $
50.00 $
200.00
1,619.00 $
$
$
$
1,619.00
$ 5,000.00 $ 5,000.00 $ 5,000.00 $
15,000.00
$ 240.00 $ 240.00 $ 240.00 $
720.00
423.64 $ 423.64 $ 423.64 $ 423.64 $
1,694.54
$
$
$
13.80 $
13.80 $
13.80 $
41.40
27.60
27.60
27.60 $
82.80
$ 552.00 $ 552.00 $ 552.00 $
1,656.00
$ 234.60 $ 234.60 $ 234.60 $
703.80
$
$
$
$
5,561.63 $ 10,008.83 $ 10,007.04 $ 10,005.25 $
35,582.75

-$ 5,561.63 $ 6,551.17 $ 6,552.96 $ 6,554.75 $

Tax
Tax Bill

Revenues

Monthly Revenue

Expenses

Fixed
Loan Payments
Rent
Rent on CC Machine
Alarm System
Annual Insurance
Management Salary
Cleaning
Ammortization
Varitable
Cards
Water
Parking
Facility
Extra Wages

Total Expenses
Earnings Before Tax
Tax
Tax Bill

Jan-06
Feb-06
Mar-06
Apr-06
May-06
Jun-06
Jul-06
Aug-06
$ 16,560.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 10,080.00 $ 10,080.00 $ 10,080.00

$
78.83 $
77.04 $
75.25 $
73.46 $
71.67 $
69.88 $
68.08 $
66.29
$ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00
$
29.99 $
29.99 $
$
$
$
$
$
$
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00
$
$
$
$
$
$
$
$
$ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00
$ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00
$ 423.64 $ 423.64 $ 423.64 $ 423.64 $ 423.64 $ 423.64 $ 423.64 $ 423.64

13.80
27.60
$ 552.00
$ 234.60
$
$ 10,003.46

$
$
$
$
$

12.00
24.00
480.00
204.00
9,893.67

$
$
$
$
$

12.00
24.00
480.00
204.00
9,861.89

$
$
$
$
$

12.00
24.00
480.00
204.00
9,860.09

$
$
$
$
$

12.00
24.00
480.00
204.00
9,858.30

$
$
$
$
$

14,097.25 $ 6,556.54 $ 4,506.33 $ 4,538.11 $ 4,539.91 $ 4,541.70 $

2,819.45 $

Sep-06
Oct-06
Nov-06
Dec-06 Year End 2006
$ 10,080.00 $ 12,960.00 $ 15,840.00 $ 18,720.00 $
104,400.00
$
$
$
$
64.50 $
62.71 $
60.92 $
59.13 $
580.50
$ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $
26,824.00
$
$
$
$
$
59.98
$
50.00 $
50.00 $
50.00 $
50.00 $
400.00
$ 1,619.00 $
$
$
$
$ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $
40,000.00
$ 240.00 $ 240.00 $ 240.00 $ 240.00 $
1,920.00
$ 363.14 $ 363.14 $ 363.14 $ 363.14 $
3,389.09
$
$
$
8.40 $
10.80 $
13.20 $
15.60 $
87.00
16.80
21.60
26.40
31.20 $
174.00
$ 336.00 $ 432.00 $ 528.00 $ 624.00 $
3,480.00
$ 142.80 $ 183.60 $ 224.40 $ 265.20 $
1,479.00
$
$
$
$
$
$ 11,193.64 $ 9,716.84 $ 9,859.05 $ 10,001.26 $
78,393.57
$
-$ 1,113.64 $ 3,243.16 $ 5,980.95 $ 8,718.74 $
26,006.43
$
$
$
$
$
$
$
5,201.29

8.40
16.80
336.00
142.80
9,640.51

$
$
$
$
$

439.49 $

8.40
16.80
336.00
142.80
9,638.72

$
$
$
$

8.40
16.80
336.00
142.80
9,636.93

441.28 $

443.07

Jan-07
Feb-07
Mar-07
Apr-07
May-07
Jun-07
Jul-07
Aug-07
$ 21,600.00 $ 24,480.00 $ 27,360.00 $ 30,240.00 $ 33,120.00 $ 36,000.00 $ 38,880.00 $ 41,760.00

$
57.33 $
55.54 $
53.75 $
51.96 $
50.17 $
48.38 $
46.58 $
44.79
$ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00
$
$
$
$
$
$
$
$
$
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00 $
50.00
$
$
$
$
$
$
$
$
$ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00
$ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00
$ 363.14 $ 363.14 $ 363.14 $ 363.14 $ 441.47 $ 441.47 $ 441.47 $ 441.47

18.00
36.00
$ 720.00
$ 306.00
$ 600.00
$ 10,743.47

20.40
40.80
$ 816.00
$ 346.80
$ 1,320.00
$ 11,605.68

22.80
45.60
$ 912.00
$ 387.60
$ 2,040.00
$ 12,467.89

25.20
50.40
$ 1,008.00
$ 428.40
$ 2,760.00
$ 13,330.09

27.60
55.20
$ 1,104.00
$ 469.20
$ 3,480.00
$ 14,270.64

30.00
60.00
$ 1,200.00
$ 510.00
$ 4,200.00
$ 15,132.84

32.40
64.80
$ 1,296.00
$ 550.80
$ 4,920.00
$ 15,995.05

34.80
69.60
$ 1,392.00
$ 591.60
$ 5,640.00
$ 16,857.26

$ 10,856.53 $ 12,874.32 $ 14,892.11 $ 16,909.91 $ 18,849.36 $ 20,867.16 $ 22,884.95 $ 24,902.74

Exhibits 4: Amortization Table

Ammortization Table
Initial Loan
Sep-05
$
24,000.00 $ 23,500.00
$ 500.00
$
86.00
$ 586.00

Oct-05
$ 23,000.00
$ 500.00
$
84.21
$ 584.21

Nov-05
$ 22,500.00
$ 500.00
$
82.42
$ 582.42

Dec-05
$ 22,000.00
$ 500.00
$
80.63
$ 580.63

Jan-06
$ 21,500.00
$ 500.00
$
78.83
$ 578.83

Feb-06
$ 21,000.00
$ 500.00
$
77.04
$ 577.04

Mar-06
$ 20,500.00
$ 500.00
$
75.25
$ 575.25

Apr-06
$ 20,000.00
$ 500.00
$
73.46
$ 573.46

May-06
$ 19,500.00
$ 500.00
$
71.67
$ 571.67

Jun-06
$ 19,000.00
$ 500.00
$
69.88
$ 569.88

Jul-06
$ 18,500.00
$ 500.00
$
68.08
$ 568.08

Aug-06
$ 18,000.00
$ 500.00
$
66.29
$ 566.29

Sep-06
$ 17,500.00
$ 500.00
$
64.50
$ 564.50

Oct-06
$ 17,000.00
$ 500.00
$
62.71
$ 562.71

Nov-06
$ 16,500.00
$ 500.00
$
60.92
$ 560.92

Dec-06
$ 16,000.00
$ 500.00
$
59.13
$ 559.13

Jan-07
$ 15,500.00
$ 500.00
$
57.33
$ 557.33

Feb-07
$ 15,000.00
$ 500.00
$
55.54
$ 555.54

Nov-06
4

Dec-06
4

Jan-07
4

Mar-07
$ 14,500.00
$ 500.00
$
53.75
$ 553.75

Apr-07
$ 14,000.00
$ 500.00
$
51.96
$ 551.96

May-07
$ 13,500.00
$ 500.00
$
50.17
$ 550.17

Jun-07
$ 13,000.00
$ 500.00
$
48.38
$ 548.38

Jul-07
$ 12,500.00
$ 500.00
$
46.58
$ 546.58

Aug-07
$ 12,000.00
$ 500.00
$
44.79
$ 544.79

Sep-07
$ 11,500.00
$ 500.00
$
43.00
$ 543.00

Exhibits 5: Revenue Forecast

Oct-05
23

Total Packages

Nov-05
-

Dec-05
-

Jan-06
-

Feb-06
20

Mar-06
-

Apr-06
-

May-06
-

Jun-06
14

Jul-06
-

Aug-06
-

Sep-06
-

Oct-06
18

Feb-07
22

Mar-07
8

Apr-07
8

May-07
8

Jun-07
26

Jul-07
12

Aug-07
12

Sep-07
12

Total Cash Flow

$ 16,560 $ 16,560 $ 16,560 $ 16,560 $ 14,400 $ 14,400 $ 14,400 $ 14,400 $ 10,080 $ 10,080 $ 10,080 $ 10,080 $ 12,960 $ 15,840 $ 18,720 $ 21,600 $ 24,480 $ 27,360 $ 30,240 $ 33,120 $ 36,000 $ 38,880 $ 41,760 $ 44,640

Total Revenue

$ 66,240 $

Initial Customers
2nd term growth rate

$ 57,600 $

Jan-06
276
0

Feb-06
240
0

Mar-06
240
0

$ 40,320 $

May-06
240
0

Jun-06
168
0

$ 51,840 $ 11,520 $ 11,520 $ 11,520 $ 63,360 $ 23,040 $ 23,040 $ 23,040 $ 74,880 $ 34,560 $ 34,560 $ 34,560

23
4

Exhibits 6: Operation Capacity

Used Capacity
Extra Labour

Oct-05
276
0

Weekly Capacity for Managers

Monthly Capacity for Managers

80
320

Facility Capcity per week (No gym 3)

Facility Capcity per month (No gym 3)
Facility Capacity per mont (No gym 3) 90%

170
680
612

Nov-05
276
0

Dec-05
276
0

Apr-06
240
0

Exhibits 7: Amortization
Ammortization Table
Fitness Equipment
Treadmill
Recumbrant Bike
Elliptical Trainer
Weight Training Equipment
Training tools
Renovations and Office Equipment
Office Equipment
Renos
Flooring
Signage
Mirrors
Total
3rd Gym addition
Flooring
Spinning Bike
Smith Cable Machines
Bench
Weights
Weight Rack
Renos
Total

Jul-06
168
0

Aug-06
168
0

Sep-06
168
0

Oct-06
216
0

Nov-06
264
0

Dec-06
312
0

Jan-07
360
40

Exhibits 8: Initial Equipment

Year 1
$ 800.00
$ 280.00
$ 360.00
$ 1,080.00
$ 100.00

Year 2
$ 480.00
$ 168.00
$ 216.00
$ 1,080.00
$ 100.00

$ 300.00
$ 900.00
$ 936.33
$ 267.50
$ 59.80
$ 5,083.63

$ 150.00
$ 900.00
$ 936.33
$ 267.50
$ 59.80
$ 4,357.63

$
$
$
$
$
$
$
$

400.00
320.00
100.00
20.00
35.00
15.00
50.00
940.00

Fitness Equipment
Treadmill
Recumbrant Bike
Elliptical Trainer
Weight Training Equipment
Training tools

Renovations and Office Equipment

Office Equipment
Renos
Flooring
Signage
Mirrors

Initial Equipment and Renovations

Feb-07
408
88

Mar-07
456
136

Apr-07
504
184

May-07
552
232

Jun-07
600
280

Jul-07
648
328

Aug-07
696
376

Sep-07
744
424

Exhibits 9: Gym 3 Cost

$
$
$
$
$
$

2,000.00
700.00
900.00
21,600.00
500.00
25,700.00

$
$
$
$
$
$

600.00
18,000.00
2,809.00
1,070.00
598.00
23,077.00

48,777.00

3rd Gym addition

Flooring
Spinning Bike
Smith Cable Machines
Bench
Weights
Weight Rack
Renos

$ 1,200.00
$ 800.00
$ 2,000.00
$ 400.00
$ 700.00
$ 300.00
$ 1,000.00

Total cost of Renovation

$ 6,400.00

Exhibits 10: Competitors Analysis

Locations # of
Fees
members

Services

Personal
Training

Hours

Other

Business Professional

GoodLife

11

2000 x 11 $45-$60 per

month

Gym, aerobic and weight-training

classes, pools, saunas

$43-$60
per hour

6am-10pm weekdays, Not all trainers

6am-8pm Saturdays, were certified
12pm-6pm Sundays

The Athletic
Club

8000 x 2 $35-$40 per

month

Machines, aerobic classes, boxing ring,

pool, dance studios, squash courts

$43-$60
per hour

24 hours from Monday Women only

5am to Saturday
sections

YMCA

$42 plus
discounts

boot camps, yoga and martial arts

$35-$40
Limited to different
per session locations

TrueStar Health 2
for Women

1000

$38-$67 per
month

One on one coaching on diet, nutrition

and fitness

Herbal Magic

800

Based on
products
purchased

Natural herbal supplements. Products

for weight management, health and
energy, specific therapy and vitamins and
minerals.

Exhibits 11: Target Market Analysis

Target Markets Analysis

Discounts to
low income
people

Women

Students

Retired People
Curves

500x6

$39-$47 per
month

No personal
training

N/A

Semi Pro Sports Team

3

Elite Personal
Training

$50-$85
Various
per session

Velocity offers
state of the art
centre

Exhibits 12: Promotion Analysis

Highway
Signage

Billboards

Radio Spots

Color Brochures

Newspaper Ad

Advantages
Virtual tour
For quality-conscious
market (research)
Reach a vast market
Focus on travelling
people
High exposure during
rush hours
Concentrated in
downtown area with
people that have above
average income
Can been seen during
anytime of the day
Wide reach
Educate public
Build Brand
Low per radio spot cost
Convenience for
reference

Hits target market

(professionals)
Target at people with
high income
Wide reach from
reputable source

Disadvantages

ROI

BE

(Customers per duration or unit)

$10,000/ $2,880

High initial set up cost

No direct target market
Maintenance cost

High

Hard to spot the signs

Possible negative
impression when sign
viewed during rush hours
High cost per each sign
Limited space for signs

Low

$5,000/ $2,880

Medium

$2,200/ $2,880

= 3.47 per development

=1.74 per month

= 0.76 per month

Limited air time

No direct target market

Medium

$200/ $2,880
= 0.07 per day

High cost per brochures

Seen as spam or waste
Competitors use
information for their own
Low expose rate (once per
week)
Image quality of the news
paper will decrease
attractiveness

Low

$10,000/ $2,800
=3.47 per 15,000 brochures

Medium

$5,000/$2,880
=1.74 per advertisement
(per week)
*$5,000/115,000papers = $4.3 cents
per paper

Corporate Companies

Promotional
Item
Website

Monday-Friday, 6am9pm. Saturday, 8am6pm.

One on one training centres

Promotes
charities
Independent
Trainers

Higher than average income

Have lots of people in nearby area
Work time from 9am to 5pm
Will work out before work or after work
Can implement fitness program with
corporate company
$100000 income on average
75% of clients are women
Soccer Moms are free after 9am.
Result oriented and had weight-loss goals
Like to work out in groups
Self concise on their weight
No constant income
School facilities are free to use
Price sensitive
Most do not have driver license
$480 first time cost for student with
student pricing ($40 per hr)
Available all day
Have high dependable savings
Can implement fitness program with
elderly homes
Can join program with insurance company
for therapy treatments
Have high budget for team training
Huge client base from a single source of
sports team
Need separate arrangement and
management on team training
Long term cash inflow with contract
signed
Corporate support on employees work out
Workout increases efficiency with
productions on the employees
Many companies within the same building
as the potential new training shop
Convenience for the employees to work
out in the training shop