Keith’s Sporting Goods, (KSG), will be selling equipment to athletes of all fitness levels. This includes weekend warriors and college athletes. We will create a welcoming environment for everyone to come in and ask for advice or discuss equipment needs.
KSG is located in Eugene and wants to be a nationally recognized sporting goods store. The exact location of the store is still unknown, but the owners are keen to find a spot with high foot traffic. We would prefer to be located in central Eugene. This is where most people can walk a few blocks to get to our store.
We fully expect to grow quickly. Although many businesses start with the same assumptions, KSG has the potential to grow quickly. Forecasts for sales growth are conservative for the first month, but will rise by 2% each other month. The first year’s growth rate is 12%. This assumption seems to be correct, given that the wholesale sector for sporting goods is growing at an average 11.5% annually.
Keith’ s Sporting Goods is going to be filed as an S Corporation. The owners of the S Corporation will be exempt from many forms of liability and will receive tax protections. We will primarily finance our business with debt through local banks and the Small Business Association (SBA) in the initial stages. We have forecasted the need for 60% debt, the owner and operator will invest the rest.
Depending on the timing of financing, we expect to have the store open by January next year and to produce strong profits by the end of that same year.
1.1 Objectives
The principal goals of the store are:
- Brand recognition. KSG will be a recognized sporting goods and fitness store in Eugene.
- To have a profit at the end of the first full year.
- In years one and two, achieve a 15% sales growth rate and maintain a constant 11.5% thereafter.
- Maintain a constant gross margin of 40%. If we are able to do this and keep costs fixed, sales will be able to grow faster than total costs.
1.2 Mission
KSG strives for long-term relationships and trust with its customers as well as employees. Managers will emphasize community involvement, community service, and further education. We feel it is extremely important to give back to the community that supports our operations, while also maintaining an atmosphere where our employees have the opportunity to improve as individuals.
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