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Do you want to start paintball business?
Are you thinking of how to start paintball business? You can never go wrong with this venture considering paintball is now a popular sport not only the United States but across the entire globe. In the U.S alone, there are over 5 million active paintball fans who invest heavily in the equipment and attire. In addition, the increasing number of professional tournaments and leagues has increased the demand for modern paintball facilities. There are also numerous exciting activities associated with paintball and opening a paintball business will reward you with good profits so long as you carefully plan your business setup strategy.
Executive Summary
2.1 The Business
The paintball business will be known as ZonerB Paintball and will be located off Exit 3 in Brookside, Kansas City. This is an excellent population that serves a large population of residents making it an ideal sport to open the business. ZonerB is a family business that will be owned and managed by Phil Richards who is a Professional Paintball Instructor.
2.2 Management Team
Phil Richards is an accomplished paintball instructor who has been actively working in the industry for over fifteen years. During his career, Phil has managed several popular paintball facilities. He is a familiar and well respected instructor who has been deeply involved in the region’s paintball events. He was a league commissioner in several tournaments around the country.
2.3 Customer Focus
ZonerB Paintball aims to offer an exciting, relaxing and social atmosphere for clients. In planning how to start a paintball business, ZonerB is keen to provide a well-equipped and friendly facility for its customers.
2.4 Business Target
The business hopes to focus on investing in a modern and impressive paintball facility that will offer diverse fun activities that will keep everyone entertained.
Company Summary
3.1 Company Owner
Phil Richards is a well-respected paintball instructor who has worked with several teams to clinch various awards and championships. During his career as an instructor and manager of several paintball facilities, Phil acquired first-hand experience in paintball business, something he hopes to replicate when opening a paintball field.
3.2 Aim of Starting the Business
The paintball culture has increased in the recent times inspiring Phil to go ahead with his plan of setting a nice, modern and well equipped paintball facility that meets the needs of paintball lovers. Despite Brookside having many paintball businesses, the rising popularity of the game has created numerous opportunities for ZonerB to explore.
3.3 How the Business will be Started
To make ZonerB a trendsetter paintball facility in Brookside, Kansas City, Phil Richards has hired professionals with vast knowledge in business startups to come up with a financial roadmap to meet business goals. Key financial data is indicated in the table below.
| Start-up Expenses | |
| Legal | $3,200 |
| Consultants | $2,500 |
| Insurance | $15,000 |
| Rent | $20,000 |
| Research and Development | $15,000 |
| Expensed Equipment | $12,000 |
| Signs | $4,000 |
| TOTAL START-UP EXPENSES | $72,700 |
| Start-up Assets | $0 |
| Cash Required | $210,000 |
| Start-up Inventory | $60,000 |
| Other Current Assets | $15,000 |
| Long-term Assets | $8,000 |
| TOTAL ASSETS | $22,000 |
| Total Requirements | $27,000 |
| START-UP FUNDING | $0 |
| START-UP FUNDING | $180,000 |
| Start-up Expenses to Fund | $135,000 |
| Start-up Assets to Fund | $325,000 |
| TOTAL FUNDING REQUIRED | $0 |
| Assets | $35,000 |
| Non-cash Assets from Start-up | $13,000 |
| Cash Requirements from Start-up | $0 |
| Additional Cash Raised | $65,000 |
| Cash Balance on Starting Date | $125,000 |
| TOTAL ASSETS | $0 |
| Liabilities and Capital | $0 |
| Liabilities | $0 |
| Current Borrowing | $0 |
| Long-term Liabilities | $0 |
| Accounts Payable (Outstanding Bills) | $0 |
| Other Current Liabilities (interest-free) | $0 |
| TOTAL LIABILITIES | $0 |
| Capital | $0 |
| Planned Investment | $0 |
| Investor 1 | $42,000 |
| Investor 2 | $20,000 |
| Other | $0 |
| Additional Investment Requirement | $0 |
| TOTAL PLANNED INVESTMENT | $140,000 |
| Loss at Start-up (Start-up Expenses) | $55,000 |
| TOTAL CAPITAL | $63,000 |
| TOTAL CAPITAL AND LIABILITIES | $65,000 |
| Total Funding | $165,000 |
Services for Customers
ZonerB has invested heavily in modern equipment and technologies to grow the paintball culture in Kansas City. In order to start a paintball business that brings good profits, Phil Richards has decided to be innovative and diversify his range of services offered at the paintball facility. Services offered at ZonerB include:
- Indoor and outdoor paintball courts
- Provision of paintball ammunition and gear
- Fully equipped Go Kart facility
- Restaurant and dining business
With all these services, ZonerB has found a unique way to cater for needs of different clientele.
Marketing Analysis for Paintball Business
For ZonerB to accomplish its business goals, a detailed market analysis was carried out to identify what areas need to be focused on to successfully conquer the marketplace. Good paintball business plans have an elaborate marketing strategy that is designed with in line with the current market trends. The paintball business hopes to use this strategy to outshine its competitors and secure a large customer base.
5.1 Market Segmentation
After studying the paintball culture in Kansas City and doing an extensive market analysis, ZonerB intends to reach out to the following groups of customers. It’s worth noting that potential clients in this case are anyone interested in paintball games.
5.1.1 Under 18 years
Paintball is an exciting game that attracts large masses of young people. For this reason, this is a key customer group the business intends to reach out. A large section of the local population consists of teenagers and young children thus presenting an excellent opportunity for ZonerB to market its services. Despite many similar established businesses in the area, Phil Richards knows the appetite for paintball especially among this age group keeps growing. In addition, a large section of under 18 year olds are still in schools which play a huge role in popularizing paintball across the city.
5.1.2 19-64 Year olds
Many residents who fall in this age group belong to the working class and therefore, earn a steady income. Given the large middle class population, these residents can afford to buy paintball ammunition and attire required for an exciting gaming experience. The business hopes to sell various services and packages to this customer segment bearing in mind they have a disposable income that allows them to spend on numerous entertainment activities. After opening a paintball field business, this group of customers is expected to frequent the paintball club to have fun and unwind.
5.1.3 Over 65 Year Olds
This category caters for senior citizens who have retired from an active career life but are looking for something exciting to keep them busy. With paintball increasingly becoming popular, seniors have also been attracted to the game. They’re an extremely sensitive group and require good customer care and help to feel comfortable within the business premises.
5.1.4 Corporates
Because of the growing interest in paintball, corporates have joined the bandwagon by regularly organizing staff paintball fun days. In addition, there are numerous paintball tournaments and competitions where various corporate teams drawn from various companies participate. This is a lucrative market segment because a single corporate booking is guaranteed to generate the business good income.
5.1.5 Professional Paintball Stakeholders
ZonerB paintball field business plan also aims to target to professional paintball teams and league organizers looking for a venue to use for tournaments. Given the number of many venues across Kansas, the business has an uphill task of positioning itself strategically to reach out to this market.
| Market Analysis | |||||||||
| Potential Customers | Growth | YEAR 1 | YEAR 2 | YEAR 3 | YEAR 4 | YEAR 5 | CAGR | ||
| Under 18 | 30% | 35,000 | 38,000 | 41,000 | 44,000 | 47,000 | 10.00% | ||
| 19-64 years | 15% | 30,000 | 33,000 | 36,000 | 39,000 | 42,000 | 12.00% | ||
| Over 65 years | 22% | 20,000 | 23,000 | 26,000 | 29,000 | 32,000 | 14.00% | ||
| Corporates | 18% | 15,000 | 18,000 | 21,000 | 24,000 | 27,000 | 16.00% | ||
| Professional Paintball Stakeholders | 15% | 10,000 | 13,000 | 16,000 | 19,000 | 22,000 | 10.00% | ||
| Total | 100% | 80,000 | 95,000 110,000 | 125,000 | 140,000 | 15.00% | |||
5.2 Business Target
ZonerB comes into the market when paintball popularity is at its peak. This is a strategic time considering starting a paintball business when there’s so much hype about the game is smart and strategic. Innovativeness is the major driving factor for the business as it seeks to use a unique business model and customer approach to distinguish itself from competitors. It is expected the paintball will be able to recover its capital within the first three years of operation. Annual sales are expected to grow on an average of 15%.
5.3 Product Pricing
How much does it cost to start a paintball business and how do I recover my startup capital? To accurately determine whether a business will be able recover the initial, product pricing is a key component that needs to be well defined. Just like other paintball business plans, ZonerB understands it has to get the pricing right to be able to survive competition. The plan is to diversify pricing using different packages to ensure all customer groups are adequately catered for. Pricing will be arrived at after considering what other paintball businesses are charging their clients. The idea is to charge slightly less than competitors especially in the first few months to popularize the brand and win customer trust.
Strategy
The success of a business is not only how to start a paintball business but which strategies are put in place to ensure business goals are realized. Phil Richards has worked closely with experts in business strategy to come up with a sustainable and result-oriented approach of consistently growing customer numbers and boost revenue. The following sales strategy has been adopted to help steer the business to positive growth.
6.1 Competitive Analysis
ZonerB Paintball field knows customer care and professionalism are the core values of success when starting a paintball field. The business intends to hire well trained and professional staff with hands-on skills to deal with various customers. In addition, the paintball field’s strategic location and nearness to public transport facilities is expected to bring in more customers.
6.2 Sales Strategy
In order for the paintball business to attract more customers to the facility, the following sales strategy will be rolled out.
- Engage in intensive marketing campaigns to create awareness for people looking for a nice and well equipped paintball field.
- Sponsor college league and weekly youth championships to reach out to the youths.
- Advertise the business on popular local media channels and incorporate digital media i.e. social media and paid local online adverts.
- Create advertising campaigns in locations such as local universities since they bring together a large number of potential customers.
- Invest in the latest state-of-the art equipment and technologies to improve customer experience
- Creatively design the paintball field with an attractive landscape and exciting colors to draw attention to the facility.
- Emphasize on exemplary customer service and ensure customer needs are well taken care of.
6.3 Sales Forecast
ZonerB is committed to fully implement the above defined sales strategies and keep a close eye on its financial books to increase annual sales. The information below summarizes sales forecasts for ZonerB Paintball business.
| Sales Forecast | |||
| Unit Sales | Year 1 | Year 2 | Year 3 |
| Indoor and outdoor paintball courts | 340,000 | 410,000 | 450,000 |
| Paintball ammunition and gear | 220,000 | 250,000 | 300,000 |
| Go Cart facility | 270,000 | 290,000 | 320,000 |
| Restaurant and dining services | 390,000 | 450,000 | 520,000 |
| TOTAL UNIT SALES | 1,005,000 | 1,250,000 | 1,500,000 |
| Unit Prices | Year 1 | Year 2 | Year 3 |
| Indoor and outdoor paintball courts | $150.00 | $160.00 | $200.00 |
| Paintball ammunition and gear | $80.00 | $100.00 | $120.00 |
| Go Cart facility | $150.00 | $180.00 | $210.00 |
| Restaurant and dining services | $200.00 | $250.00 | $270.00 |
| Sales | |||
| Indoor and outdoor paintball courts | $300,000 | $350,000 | $400,000 |
| Paintball ammunition and gear | $270,000 | $310,000 | $350,000 |
| Go Cart facility | $85,000 | $125,000 | $145,000 |
| Restaurant and dining services | $260,000 | $300,000 | $310,000 |
| TOTAL SALES | |||
| Direct Unit Costs | Year 1 | Year 2 | Year 3 |
| Indoor and outdoor paintball courts | $2.20 | $3.20 | $4.20 |
| Paintball ammunition and gear | $2.00 | $3.00 | $5.00 |
| Go Cart facility | $1.60 | $2.60 | $4.00 |
| Restaurant and dining services | $6.00 | $5.00 | $4.00 |
| Direct Cost of Sales | |||
| Indoor and outdoor paintball courts | $200,000 | $220,000 | $140,000 |
| Paintball ammunition and gear | $150,000 | $180,000 | $210,000 |
| Go Cart facility | $155,000 | $135,000 | $152,000 |
| Restaurant and dining services | $160,000 | $175,000 | $195,000 |
| Subtotal Direct Cost of Sales | $255,000 | $385,000 | $465,000 |
Personnel Plan
ZonerB is a large paintball field that requires staff with different expertise to work together and facilitate smooth operations of the business. For Phil Richards and anyone else planning how to start a paintball field, the following staff is key to run the business.
7.1 Personnel Plan
ZonerB Paintball field is owned by Phil Richards, an experienced Paintball Instructor who will be the overall manager of the business. The business will also employ the following professionals to work in various departments.
- One Assistant Manager
- One Accountant
- One League Coordinator
- One Customer Care Representative
- Two Marketing Executives
- Two Cleaners
- One Safety Inspector
- One Concession Person
- Two Referees
Successful candidates will undergo extensive training on various areas of focus associated with a paintball field before the business officially opens.
7.2 Average Staff Salaries
In the first three years of operations, ZonerB Paintball field intends to pay its personnel the following annual average salaries.
| Personnel Plan | |||
| Year 1 | Year 2 | Year 3 | |
| 1 Assistant manager | $60,000 | $65,000 | $70,000 |
| 1 Account | $35,000 | $42,000 | $47,000 |
| 1 League Cordinator | $30,000 | $34,000 | $38,000 |
| 1 Customer care representative | $27,000 | $33,000 | $36,000 |
| 2 Marketing executives | $52,000 | $56,000 | $60,000 |
| 2 cleaners | $40,000 | $45,000 | $47,000 |
| 1 Concession person | $22,000 | $28,000 | $32,000 |
| 2 Referees | $52,000 | $55,000 | $58,000 |
| Total Salaries | $265,000 | $350,000 | $425,000 |
Financial Plan
ZonerB has a comprehensive financial plan that is expected to guide business management. Starting paintball field requires an elaborate financial plan to help the business meet its financial obligations and run its operations. Initial capital will be supplemented by a bank loan to help kickstart operations. The following is a summary of various financial statistics for ZonerB Paintball business. This is key information for anyone planning to open a paintball field business.
8.1 Important Assumptions
ZonerB has computed its financial expectations based on the assumptions below.
| General Assumptions | |||
| Year 1 | Year 2 | Year 3 | |
| Plan Month | 1 | 2 | 3 |
| Current Interest Rate | 14.00% | 16.00% | 18.00% |
| Long-term Interest Rate | 7.00% | 7.00% | 700.00% |
| Tax Rate | 12.00% | 14.00% | 16.00% |
| Other | 0 | 0 | 0 |
8.2 Brake-even Analysis
The graph below indicated ZonerB Paintball business Brake-even Analysis.
| Brake-Even Analysis | |
| Monthly Units Break-even | 10000 |
| Monthly Revenue Break-even | $160,000 |
| Assumptions: | |
| Average Per-Unit Revenue | $250.00 |
| Average Per-Unit Variable Cost | $0.70 |
| Estimated Monthly Fixed Cost | $320,000 |
8.3 Projected Profit and Loss
Below is Profit and Loss information for ZonerB Paintball field determined on a monthly and annual basis.
| Pro Forma Profit And Loss | |||
| Year 1 | Year 2 | Year 3 | |
| Sales | $600,000 | $700,000 | $800,000 |
| Direct Cost of Sales | $50,000 | $60,000 | $80,000 |
| Other | $0 | $0 | $0 |
| TOTAL COST OF SALES | $60,000 | $80,000 | $100,000 |
| Gross Margin | $420,000 | $550,000 | $560,000 |
| Gross Margin % | 80.00% | 74.00% | 83.00% |
| Expenses | |||
| Payroll | $250,000 | $350,000 | $425,000 |
| Sales and Marketing and Other Expenses | $8,000 | $5,000 | $9,000 |
| Depreciation | $7,000 | $9,000 | $6,000 |
| Leased Equipment | $0 | $0 | $0 |
| Utilities | $7,000 | $5,000 | $6,000 |
| Insurance | $9,000 | $10,000 | $8,600 |
| Rent | $14,000 | $16,000 | $18,000 |
| Payroll Taxes | $50,000 | $65,000 | $70,000 |
| Other | $0 | $0 | $0 |
| Total Operating Expenses | $320,000 | $350,000 | $400,000 |
| Profit Before Interest and Taxes | $40,000 | $60,000 | $80,000 |
| EBITDA | $30,000 | $50,000 | $80,000 |
| Interest Expense | $0 | $0 | $0 |
| Taxes Incurred | $24,000 | $26,000 | $30,000 |
| Net Profit | $120,000 | $135,000 | $140,000 |
| Net Profit/Sales | 40.00% | 55.00% | 60.00% |
8.3.1 Monthly Profit
8.3.2 Yearly Profit
8.3.3 Monthly Gross Margin
8.3.4 Yearly Gross Margin
Below is a Profit and Loss Analysis for the business.
8.4 Projected Cash Flow
The diagram below indicates subtotal cash received, subtotal cash spent, subtotal cash spent on operations, subtotal cash from operations and Pro forma cash flow.
| Pro Forma Cash Flow | |||
| Cash Received | Year 1 | Year 2 | Year 3 |
| Cash from Operations | |||
| Cash Sales | $100,000 | $205,000 | $260,000 |
| Cash from Receivables | $10,000 | $15,000 | $18,000 |
| SUBTOTAL CASH FROM OPERATIONS | $68,000 | $70,000 | $90,000 |
| Additional Cash Received | |||
| Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 |
| New Current Borrowing | $0 | $0 | $0 |
| New Other Liabilities (interest-free) | $0 | $0 | $0 |
| New Long-term Liabilities | $0 | $0 | $0 |
| Sales of Other Current Assets | $0 | $0 | $0 |
| Sales of Long-term Assets | $0 | $0 | $0 |
| New Investment Received | $0 | $0 | $0 |
| SUBTOTAL CASH RECEIVED | $68,000 | $70,000 | $90,000 |
| Expenditures | Year 1 | Year 2 | Year 3 |
| Expenditures from Operations | |||
| Cash Spending | $20,000 | $25,000 | $30,000 |
| Bill Payments | $5,000 | $10,000 | $22,000 |
| SUBTOTAL SPENT ON OPERATIONS | $25,000 | $36,500 | $40,000 |
| Additional Cash Spent | |||
| Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 |
| Principal Repayment of Current Borrowing | $0 | $0 | $0 |
| Other Liabilities Principal Repayment | $0 | $0 | $0 |
| Long-term Liabilities Principal Repayment | $0 | $0 | $0 |
| Purchase Other Current Assets | $0 | $0 | $0 |
| Purchase Long-term Assets | $0 | $0 | $0 |
| Dividends | $0 | $0 | $0 |
| SUBTOTAL CASH SPENT | $45,000 | $55,000 | $65,000 |
| Net Cash Flow | $27,000 | $35,000 | $58,000 |
| Cash Balance | $33,000 | $48,000 | $53,000 |
8.5 Projected Balance Sheet
Below is ZonerB Projected balance sheet indicating assets, liabilities, capital, current liabilities and long-term assets.
| Pro Forma Balance Sheet | |||
| Assets | Year 1 | Year 2 | Year 3 |
| Current Assets | |||
| Cash | $300,000 | $350,000 | $380,000 |
| Accounts Receivable | $100,000 | $120,000 | $150,000 |
| Inventory | $5,000 | $6,000 | $9,000 |
| Other Current Assets | $6,000 | $3,000 | $9,000 |
| TOTAL CURRENT ASSETS | $315,000 | $479,000 | $638,000 |
| Long-term Assets | |||
| Long-term Assets | $20,000 | $23,000 | $30,000 |
| Accumulated Depreciation | $33,000 | $36,000 | $40,000 |
| TOTAL LONG-TERM ASSETS | $6,000 | $3,000 | $1,500 |
| TOTAL ASSETS | $230,000 | $350,000 | $400,000 |
| Liabilities and Capital | Year 1 | Year 2 | Year 3 |
| Current Liabilities | |||
| Accounts Payable | $25,000 | $38,000 | $46,000 |
| Current Borrowing | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $0 | $0 |
| SUBTOTAL CURRENT LIABILITIES | $25,000 | $38,000 | $41,000 |
| Long-term Liabilities | $0 | $0 | $0 |
| TOTAL LIABILITIES | $18,000 | $40,000 | $47,000 |
| Paid-in Capital | $20,000 | $20,000 | $20,000 |
| Retained Earnings | $25,000 | $60,000 | $85,000 |
| Earnings | $150,000 | $220,000 | $240,000 |
| TOTAL CAPITAL | $280,000 | $330,000 | $360,000 |
| TOTAL LIABILITIES AND CAPITAL | $380,000 | $290,000 | $340,000 |
| Net Worth | $320,000 | $450,000 | $380,000 |
8.6 Business Ratios
This is a representation of Business Ratios, Ratio Analysis and business Net Worth for ZonerB Paintball business.
| Ratio Analysis | ||||
| Year 1 | Year 2 | Year 3 | INDUSTRY PROFILE | |
| Sales Growth | 20.00% | 23.00% | 30.00% | 10.00% |
| Percent of Total Assets | ||||
| Accounts Receivable | 10.00% | 9.00% | 8.00% | 11.00% |
| Inventory | 8.00% | 5 | 4.00% | 9.00% |
| Other Current Assets | 1.00% | 3.40% | 3.00% | 20.00% |
| Total Current Assets | 86.00% | 90.00% | 120.00% | 43.00% |
| Long-term Assets | -6.00% | -10.00% | -20.00% | 30.20% |
| TOTAL ASSETS | 90.00% | 90.00% | 90.00% | 90.00% |
| Current Liabilities | 10.00% | 7.00% | 5.00% | 18.00% |
| Long-term Liabilities | 0.00% | 0.00% | 0.00% | 20.00% |
| Total Liabilities | 7.00% | 3.00% | 1.50% | 30.00% |
| NET WORTH | 100.00% | 70.00% | 80.00% | 30.00% |
| Percent of Sales | ||||
| Sales | 90.00% | 90.00% | 90.00% | 90.00% |
| Gross Margin | 70.00% | 63.00% | 60.00% | 0.00% |
| Selling, General & Administrative Expenses | 50.00% | 60.00% | 45.00% | 60.00% |
| Advertising Expenses | 5.00% | 4.00% | 2.30% | 3.50% |
| Profit Before Interest and Taxes | 30.00% | 24.00% | 26.00% | 3.50% |
| Main Ratios | ||||
| Current | 18 | 13 | 12 | 0.9 |
| Quick | 27 | 13 | 25.5 | 1.5 |
| Total Debt to Total Assets | 4.05% | 3.00% | 2.65% | 40.00% |
| Pre-tax Return on Net Worth | 90.00% | 87.00% | 93.00% | 4.20% |
| Pre-tax Return on Assets | 60.00% | 58.00% | 65.00% | 10.00% |
| Additional Ratios | Year 1 | Year 2 | Year 3 | |
| Net Profit Margin | 15.00% | 10.00% | 20.00% | N.A. |
| Return on Equity | 60.00% | 50.00% | 48.00% | N.A. |
| Activity Ratios | ||||
| Accounts Receivable Turnover | 5 | 7 | 9 | N.A. |
| Collection Days | 78 | 87 | 100 | N.A. |
| Inventory Turnover | 18 | 16 | 18 | N.A. |
| Accounts Payable Turnover | 12.2 | 16.2 | 17 | N.A. |
| Payment Days | 25 | 25 | 25 | N.A. |
| Total Asset Turnover | 3.6 | 2.7 | 2.9 | N.A. |
| Debt Ratios | ||||
| Debt to Net Worth | 0 | -0.09 | -0.01 | N.A. |
| Current Liab. to Liab. | 0 | 0 | 0 | N.A. |
| Liquidity Ratios | ||||
| Net Working Capital | $500,000 | $520,000 | $640,000 | N.A. |
| Interest Coverage | 0 | 0 | 0 | N.A. |
| Additional Ratios | ||||
| Assets to Sales | 1.45 | 2.48 | 3.32 | N.A. |
| Current Debt/Total Assets | 8% | 4% | 3% | N.A. |
| Acid Test | 30 | 33 | 35 | N.A. |
| Sales/Net Worth | 3.3 | 1.7 | 1.7 | N.A. |
| Dividend Payout | 0 | 0 | 0 | N.A. |
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