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Business Plan

Z

Zysoclaplem

Diamond Member
The small business my group and I have come up with should have a potential of $76,507.20 profit in the first year of business. That's after interest from the bank and taxes. Is that decent for a new small business?
It's a LAN Gaming Center, with consoles and concession, like drinks and snacks.
It's just a business plan, but I would still take pride in knowing that it's at least average.
 
When you say profit, does that mean after paying your salary or before?

Also, you mentioned interest, will all the loans be paid off or will they carry forward?

Lastly, I assume you factored in that noone will know about or come to your business when you first open. (better safe than sorry)
 
Originally posted by: Mwilding
When you say profit, does that mean after paying your salary or before?

Also, you mentioned interest, will all the loans be paid off or will they carry forward?

Lastly, I assume you factored in that noone will know about or come to your business when you first open. (better safe than sorry)
Click to expand...

It's a business plan heh.
And it's after salary. 3 employees.
We are just doing potential, and we are spending a crapload on advertising and also placement. Through research I found that our biggest market will be school students, mainly college students. So I found a building for us within a mile of each of the two largest colleges in the East Texas area.
This $76,507.20 is 100% profit, as i already factored in 10% for interest per year of the loan, and 30% of taxes. So basically, all we have to do is pay off the loan of $237,600.00.
With a 76k profit a year, that could be done within 5 years, and still allow for upgrades and possible raises.
 
A business plan should include not only your potential profits, but about 3-4 scenarios to cover different scenarios. Be sure to put in a solid accounting system and a marketing plan. Very few businesses profit within the first 2-3 years after paying back your initial investments.

I would suggest not doing a partnership....make it a private corporation to cover liabilities and keep your partners straight. If you are a partnership, the partners can borrow money from the company on their own authority....if you go corporate, the accountability goes on them.
 
So basically, you and two other people put your heart and soul into a company and walk away with $25,000 each after a year?

Wouldn't you be better off working at McDonalds and not taking on the debt?
 
Agreed, setup a proper corporate structure to protect the business and yourself.

Have you done the market research to determine if there really is a demand and not just something that sounds good?
 
Originally posted by: Scarpozzi
A business plan should include not only your potential profits, but about 3-4 scenarios to cover different scenarios. Be sure to put in a solid accounting system and a marketing plan. Very few businesses profit within the first 2-3 years after paying back your initial investments.

I would suggest not doing a partnership....make it a private corporation to cover liabilities and keep your partners straight. If you are a partnership, the partners can borrow money from the company on their own authority....if you go corporate, the accountability goes on them.
Click to expand...

We haven't discussed that in our class.
It's all potential. Nothing is for sure when it comes to small business.
What he is teaching us to do is to read the market.
It may not be 100% correct, but it's using the proper information, and the proper plans to get to the profit.
If we are coming up with 76k profit, we will still be in debt to the bank for 4 years, as we will be paying them back for that long.
I am pretty happy with our results so far.
 
Originally posted by: AgaBoogaBoo
Agreed, setup a proper corporate structure to protect the business and yourself.

Have you done the market research to determine if there really is a demand and not just something that sounds good?
Click to expand...

I concur....and way to give ATOT a jump on your business plan so that we all can replicate it😀
 
Originally posted by: PingSpike
I agree, make it a corporation. Shouldn't that shield you should the business fail?
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Creditors can't go after your personal assets should the business default.

An LLC might be a way to go.
 
A business should make enough to sustain itself. When you you 76k, are you factoring in the cost of maintaining the business such as insuranceand other monthly and yearly expenditures etc?
 
Thankfully this is just an exercise, because I dont know of any local area network gaming businesses that made it in the 5 million+ pop DFW area.

And electricity costs would eat you alive. Unless of course you plan on using solar or wind power. 😉
 
and .20 cents! NO WAI!

Lol Lan Gaming centers usually dont work out.

My mom runs her own Jewelry store. I dont know if she ever had a business plan. She started real small and now owns 1 rather large store.
 
Originally posted by: Scarpozzi
A business plan should include not only your potential profits, but about 3-4 scenarios to cover different scenarios. Be sure to put in a solid accounting system and a marketing plan. Very few businesses profit within the first 2-3 years after paying back your initial investments.

I would suggest not doing a partnership....make it a private corporation to cover liabilities and keep your partners straight. If you are a partnership, the partners can borrow money from the company on their own authority....if you go corporate, the accountability goes on them.
Click to expand...


Or a LLC, at least limit your liability, partnership on a high risk business like a LAN center is a recipe for bankruptcy.
 
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