Table of Content

    Do you want to start a roller rink business?

    Are you planning to open a roller rink business? This is an awesome business to invest in since many people nowadays love the roller skating culture. From adults to children, the numbers of people looking for roller skating services have tremendously increased over the years. Roller skating is not only a great exercise to engage in with your family, but it’s also fun. So, at the end of the day you will be bonding and improving the health of your loved ones at the same time. The startup capital required may be on the high side but with proper planning and funding for you will recover your costs within a few years of business.

    Executive Summary

    2.1 The Business

    The roller rink business shall be registered under the name Smooth Slide Rink, and will be situated in Enos Park, Springfield Illinois. The business will be owned and managed by Samantha Davis an experienced and award winning skating professional.

    2.2 Management Team

    Samantha Davis is a skating instructor who has been in the roll skating industry for over twelve years. Before opening a roller skating rink business, Samantha worked for many schools and popular fitness brands across United States and Canada training adults and students the art of skating thus gaining impressive knowledge and experience.

    2.3 Customer Focus

    Smooth Slide Rink intends to offer a modern, spacious and well equipped facility for all potential customers across the city of Springfield.

    2.4 Business Target

    Since it will be the first roller rink business in the neighborhood, the whole community and residents of Springfield will highly benefiting from a well-managed and equipped facility.

    Roller Rink Business Plan - 3 Years Profit Forecast

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    Company Summary

    3.1 Company Owner

    Samantha Davis is a skating instructor who has worked with top USA skating schools such as U.S. Figure Skating. She also worked as a skating instructor at The Mariposa School of Skating in Canada for more than 10 years. She has greatly contributed to ensure the growth of the roller skating industry by working in the course of her career.

    3.2 Aim of Starting the Business

    To open a roller skating rink business, it requires an expert who understands the art of skating and handling the business to properly identify priorities and set goals. Samantha has previously managed roller skating and therefore, comprehends the nitty-gritty details of managing a roller rink skating facility.

    3.3 How the Business will be Started

    As a professional skating instructor, Samantha understands what it entails to begin this venture and to make it successful. To actualize her plan, she has hired professional to come up with an impressive financial roadmap to guide the business. The following is the ultimate financial data for Smooth Slide Rink.

    Roller Rink Business Plan - Startup cost

    Start-up Expenses  
    Legal $3,000
    Consultants $2,500
    Insurance $8,000
    Rent $20,000
    Research and Development $10,000
    Expensed Equipment $20,000
    Signs $3,000
    TOTAL START-UP EXPENSES $66,000
    Start-up Assets $0
    Cash Required $120,000
    Start-up Inventory $30,000
    Other Current Assets $15,000
    Long-term Assets $5,000
    TOTAL ASSETS $25,000
    Total Requirements $30,000
    START-UP FUNDING $0
    START-UP FUNDING $80,000
    Start-up Expenses to Fund $40,000
    Start-up Assets to Fund $30,000
    TOTAL FUNDING REQUIRED $0
    Assets $12,000
    Non-cash Assets from Start-up $15,000
    Cash Requirements from Start-up $0
    Additional Cash Raised $50,000
    Cash Balance on Starting Date $20,000
    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 $22,000
    Investor 2 $20,000
    Other $0
    Additional Investment Requirement $0
    TOTAL PLANNED INVESTMENT $120,000
    Loss at Start-up (Start-up Expenses) $40,000
    TOTAL CAPITAL $45,000
    TOTAL CAPITAL AND LIABILITIES $40,000
    Total Funding $100,000

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    Services for Customers

    Smooth Slide Rink is keen to offer top notch and modern roller skating facilities for potential customers. Since Samantha already has an idea of how to open a roller skating rink business, the venture will focus on building a healthy and long lasting client relationships as it offers the following services.

    • Offer indoor roller skating expeditions.
    • Provide video arcade and redemption counter.
    • Small restaurant to offer snacks and refreshments.
    • Hosting Parties and fundraising

    Marketing Analysis for Roller Rink Business

    For Smooth Slide Rink to meet its market goals, a well-researched market analysis to find out market trends was started to assist the business effectively tap into the market. This roller rink business plan has showed the strategy the business intends to focus on to meet its obligations.

    Note

    With the fast growth and popularity of roller skating in Springfield, there is a huge potential for Smooth Slide Rink to take advantage of. Taking into consideration the location of the business, demographic stats and available competition, it is guaranteed the skating facility will enjoy a high number of customers.

    5.1 Market Segmentation

    With a good roller skating rink business plan, this will act as good foundation to start a strong and marketable business. Smooth Slide Rink therefore has the best opportunity to engage in intensive marketing campaigns to command a larger market share. One doesn’t need to have prior experience roller skating to visit the facility to have a good time. Based on market findings, the skating facility intends to target the following groups of customers.

    Roller Rink Business Plan - Market Segmentation

    5.1.1 Children

    A lot of roller skating facilities earn a lot of money and profits from children related activities. Smooth Slide Rink plans to have a wide option of children’s programs that will make the facility attractive for children. Springfield has a wide population of children between ages of five to seventeen which is key revenue potential for business. Nowadays, parents are open to the idea of having their children take part in fun and recreation activities in order to encourage healthy living. With a roller skating facility in the community, the most lucrative customers for the business will be children.

    Business Plan for Investors

    5.1.2 Adults (Age 18-44)

    As roller skating activity popularity is increasing each single day, and adults too are over the moon to try skating for fun. This roller skating rink startup sample business plan also includes adults since the business plans to put in place awesome activities that will appeal to the adult between 18-44 years. Since most of this age group are working and in active activities, they will most likely have to pay for membership which will generate a more steady income for the skating facility.

    5.1.3 Schools and College Students

    Roller skating is a major trend in many educational institution. In this case, many schools once in a while always organize indoor roller skating competitions. Smooth Slide Rink stands a great chance to gain as these schools and their students will need a professionally managed and well equipped facility where they can compete and have a fun. With the high number of high schools and vocational schools in Springfield, the business will definitely flourish. Smooth Slide Rink plans to widely market its services to this target group to maximize on profits.

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    5.1.4 Churches and Religious Centers

    The neighborhood has a great number of religious institutions and churches that periodically organize recreation activities for the congregations. Thanks to Smooth Slide Rink, they will be able to have fun and engaging religious activities at the facility.

    Market Analysis
    Potential Customers Growth YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 CAGR
    Adults 30% 23,000 26,000 29,000 32,000 35,000 10.00%
    Children 35% 20,000 23,000 26,000 29,000 31,000 12.00%
    Schools and College Students 19% 18,000 21,000 24,000 27,000 30,000 14.00%
    Churches and Reigious Centers 16% 15,000 18,000 21,000 24,000 27,000 9.00%
    Total 100% 76,000 88,000               100,000 112,000 123,000 11.00%

    5.2 Business Target

    Smooth Slide Facility is ready to start operations in an easily accessible location where there is limited to no competition. The high population in Springfield is a great source of market for the skating facility. When allocating the roller skating rink start up costs, the business knows it will be expensive to open the facility and therefore, enough plans are needed to recover the initial investment. Smooth Slide Rink hopes to make fully recovery of the startup cost investment in two years. The skating facility has predicted a 30-40% annual increase in sales.

    5.3 Product Pricing

    A good roller skating business plan should be carefully thought through and accurate prices indicated to lay a perfect foundation for the business. Although there is no competition, Smooth Slide Rink has come up with affordable prices to attract and retain customers.

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    Strategy

    If you are wondering how to open a skating rink business that will be successful from launching, you need to come up with a comprehensive and realistic strategy. Samantha Davis has worked with skating experts to come up with a personalized roller skating rink business strategy that will be the backbone of attracting business revenue. The following is Smooth Slide Rink sales strategy.

    6.1 Competitive Analysis

    Smooth Slide Rink is located in an accessible location with a huge population of the market target. Furthermore, this is the first skating rink business in the area, so there will be a high demand.

    6.2 Sales Strategy

    To make sure Smooth Slide Rink reaches its intended customers, these helpful strategies will be used to boost sales.

    • The business will use word of mouth marketing to market the facilities.
    • The skating facility will use local advertising methods such as churches, religious institutions, print media, radio, Television, schools and vocation institutions.
    • Plan a publicized grand opening party to create awareness about the new roller rink skating facility.
    • Use digital media platforms such as Twitter, Instagram and Facebook to advertise.
    • Offer an introductory reduced fee for the first members.
    • Organize numerous children activities such as birthday parties.

    6.3 Sales Forecast

    Smooth Slide Rink is focused on offering a wide variety of sales strategies to its targets.

    Roller Rink Business Plan - Unit Sales

    Sales Forecast      
    Unit Sales Year 1 Year 2 Year 3
    Indoor Roller Skating Expedition 400,000 420,000 440,000
    Video arcade and redemtion center 250,000 300,000 350,000
    Hosting parties and fundraising 200,000 250,000 300,000
    Small restaurant for snacks &refreshments 150,000 200,000 250,000
    TOTAL UNIT SALES 1,150,000 1,550,000 1,970,000
    Unit Prices Year 1 Year 2 Year 3
    Indoor Roller Skating Expedition $200.00 $220.00 $240.00
    Video arcade and redemtion center $170.00 $200.00 $230.00
    Hosting parties and fundraising $150.00 $180.00 $210.00
    Small restaurant for snacks &refreshments $130.00 $160.00 $190.00
    Sales
    Indoor Roller Skating Expedition $200,000 $230,000 $260,000
    Video arcade and redemtion center $180,000 $200,000 $230,000
    Hosting parties and fundraising $150,000 $180,000 $210,000
    Small restaurant for snacks &refreshments $100,000 $130,000 $160,000
    TOTAL SALES
    Direct Unit Costs Year 1 Year 2 Year 3
    Indoor Roller Skating Expedition $3.20 $4.20 $5.20
    Video arcade and redemtion center $2.00 $3.00 $4.00
    Hosting parties and fundraising $1.60 $2.60 $3.00
    Small restaurant for snacks &refreshments $1.50 $2.50 $3.50
    Direct Cost of Sales
    Indoor Roller Skating Expedition $120,000 $140,000 $160,000
    Video arcade and redemtion center $100,000 $120,000 $140,000
    Hosting parties and fundraising $80,000 $100,000 $120,000
    Small restaurant for snacks &refreshments $50,000 $70,000 $90,000
    Subtotal Direct Cost of Sales $350,000 $430,000 $510,000

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    Personnel Plan

    Smooth Slide Rink offers various services to maximize on the profits. How the business intends to pay salaries is well indicated in this roller skating rink business plan.

    7.1 Personnel Plan

    Smooth Slide Rink is owned by Samantha Davis, who understands how to start a roller skating rink business. She will be also the operating manager of business. Other people to be hired include.

    • Business Manager
    • Assistant Manager
    • Administrator
    • Three Instructors
    • Two Marketing Executives
    • One Cashier

    7.2 Average Staff Salaries

    Smoot Slide Rink plans to spend the following amounts on staff salaries for the first three years.

     Personnel Plan      
    Year 1 Year 2 Year 3
    Manager $50,000 $70,000 $90,000
    Cashier $20,000 $23,000 $26,000
    Administrator $25,000 $35,000 $40,000
    2 Sales and Marketing Executive $40,000 $60,000 $80,000
    3 Skating Instructors $105,000 $120,000 $129,000
    Assitant Manager $30,000 $33,000 $36,000
    Total Salaries $270,000 $341,000 $401,000

    Financial Plan

    Smooth Slide Rink has a steady financial plan that will guide the business to run smoothly and achieve success. Starting a skating rink business will be facilitated by Samantha’s personal savings and business plan for angel investors. Key financial information for the business has been shown in the sections below.

    8.1 Important Assumptions

    Financial forecasts of Smooth Slide Rink will be based on these assumptions.

     General Assumptions      
    Year 1 Year 2 Year 3
    Plan Month 1 2 3
    Current Interest Rate 15.00% 17.00% 19.00%
    Long-term Interest Rate 5.00% 5.00% 5.00%
    Tax Rate 14.00% 17.00% 20.00%
    Other 0 0 0

    8.2 Brake-even Analysis

    Smooth Slide Rink Brake-even Analysis is show in the graph below.

    Roller Rink Business Plan - Brake-even Analysis

     Brake-Even Analysis  
    Monthly Units Break-even 10000
    Monthly Revenue Break-even $250,000
    Assumptions:
    Average Per-Unit Revenue $200.00
    Average Per-Unit Variable Cost $2.00
    Estimated Monthly Fixed Cost $400,000

    8.3 Projected Profit and Loss

    Profit and Loss information for Smooth Slide Rink computed on an annual and monthly basis is as shown below.

     Pro Forma Profit And Loss      
    Year 1 Year 2 Year 3
    Sales $400,000 $420,000 $440,000
    Direct Cost of Sales $40,000 $60,000 $80,000
    Other $0 $0 $0
    TOTAL COST OF SALES $40,000 $60,000 $80,000
    Gross Margin $200,000 $250,000 $300,000
    Gross Margin % 60.00% 65.00% 70.00%
    Expenses
    Payroll $300,000 $310,000 $330,000
    Sales and Marketing and Other Expenses $10,000 $14,000 $16,000
    Depreciation $4,000 $6,000 $8,000
    Leased Equipment $0 $0 $0
    Utilities $5,000 $8,000 $11,000
    Insurance $2,400 $3,400 $4,400
    Rent $12,000 $14,000 $16,000
    Payroll Taxes $40,000 $42,000 $44,000
    Other $0 $0 $0
    Total Operating Expenses $300,000 $320,000 $350,000
    Profit Before Interest and Taxes $40,000 $45,000 $50,000
    EBITDA $20,000 $30,000 $50,000
    Interest Expense $0 $0 $0
    Taxes Incurred $18,000 $21,000 $24,000
    Net Profit $150,000 $170,000 $190,000
    Net Profit/Sales 50.00% 60.00% 70.00%

    8.3.1 Monthly Profit

    Roller Rink Business Plan - PROFIT MONTHLY

    8.3.2 Yearly Profit

    Roller Rink Business Plan - PROFIT YEARLY

    8.3.3 Monthly Gross Margin

    Roller Rink Business Plan - GROSS MARGIN MONTHLY

    8.3.4 Yearly Gross Margin

    Roller Rink Business Plan - GROSS MARGIN YEARLY

    8.4 Projected Cash Flow

    The diagram below summarizes projected cash flow.

    Roller Rink Business Plan - Projected Cash Flow

     Pro Forma Cash Flow      
    Cash Received Year 1 Year 2 Year 3
    Cash from Operations
    Cash Sales $150,000 $155,000 $160,000
    Cash from Receivables $10,000 $15,000 $20,000
    SUBTOTAL CASH FROM OPERATIONS $160,000 $170,000 $180,000
    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 $160,000 $170,000 $180,000
    Expenditures Year 1 Year 2 Year 3
    Expenditures from Operations
    Cash Spending $30,000 $32,000 $34,000
    Bill Payments $10,000 $13,000 $16,000
    SUBTOTAL SPENT ON OPERATIONS $30,000 $42,000 $50,000
    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 $40,000 $520,000 $60,000
    Net Cash Flow $22,000 $25,000 $28,000
    Cash Balance $33,000 $38,000 $43,000

    8.5 Projected Balance Sheet

    Illustrated below is the Projected Balance Sheet for Smooth Slide Rink.

     Pro Forma Balance Sheet      
    Assets Year 1 Year 2 Year 3
    Current Assets
    Cash $200,000 $230,000 $260,000
    Accounts Receivable $6,000 $10,000 $14,000
    Inventory $5,000 $7,500 $10,000
    Other Current Assets $4,000 $4,000 $4,000
    TOTAL CURRENT ASSETS $215,000 $254,500 $288,000
    Long-term Assets
    Long-term Assets $12,000 $14,000 $16,000
    Accumulated Depreciation $14,000 $17,000 $20,000
    TOTAL LONG-TERM ASSETS $3,000 $2,000 $1,500
    TOTAL ASSETS $234,000 $284,500 $365,500
    Liabilities and Capital Year 1 Year 2 Year 3
    Current Liabilities
    Accounts Payable $25,000 $28,000 $31,000
    Current Borrowing $0 $0 $0
    Other Current Liabilities $0 $0 $0
    SUBTOTAL CURRENT LIABILITIES $25,000 $28,000 $31,000
    Long-term Liabilities $0 $0 $0
    TOTAL LIABILITIES $25,000 $28,000 $31,000
    Paid-in Capital $20,000 $20,000 $20,000
    Retained Earnings $30,000 $45,000 $60,000
    Earnings $130,000 $150,000 $170,000
    TOTAL CAPITAL $350,000 $380,000 $410,000
    TOTAL LIABILITIES AND CAPITAL $350,000 $380,000 $410,000
    Net Worth $420,000 $450,000 $480,000

    8.6 Business Ratios

    Smooth Slide Rink Ration Analysis, Business New Worth and Business Ratios are shown below.

     Ratio Analysis        
    Year 1 Year 2 Year 3 INDUSTRY PROFILE
    Sales Growth 10.00% 23.00% 35.00% 5.00%
    Percent of Total Assets
    Accounts Receivable 5.00% 4.00% 3.00% 6.00%
    Inventory 6.00% 4% 3.00% 8.00%
    Other Current Assets 4.00% 3.00% 2.00% 20.00%
    Total Current Assets 90.00% 95.00% 105.00% 40.10%
    Long-term Assets -7.00% -14.00% -21.00% 30.00%
    TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
    Current Liabilities 6.00% 5.00% 3.00% 20.00%
    Long-term Liabilities 0.00% 0.00% 0.00% 18.00%
    Total Liabilities 4.00% 2.00% 1.00% 38.00%
    NET WORTH 80.00% 100.00% 110.00% 30.00%
    Percent of Sales
    Sales 100.00% 100.00% 100.00% 100.00%
    Gross Margin 80.00% 70.00% 60.00% 1.00%
    Selling, General & Administrative Expenses 70.00% 77.00% 72.00% 60.00%
    Advertising Expenses 4.00% 3.00% 2.00% 3.00%
    Profit Before Interest and Taxes 20.00% 24.00% 30.00% 2.50%
    Main Ratios
    Current 12 15 20 2.3
    Quick 20 23 30 2.5
    Total Debt to Total Assets 4.00% 3.75% 2.10% 66.00%
    Pre-tax Return on Net Worth 85.00% 95.00% 5.00% 5.00%
    Pre-tax Return on Assets 54.00% 64.00% 76.00% 8.00%
    Additional Ratios Year 1 Year 2 Year 3
    Net Profit Margin 14.00% 17.00% 25.00% N.A.
    Return on Equity 62.00% 65.00% 72.00% N.A.
    Activity Ratios
    Accounts Receivable Turnover 7 9 12 N.A.
    Collection Days 100 110 120 N.A.
    Inventory Turnover 23 26 29 N.A.
    Accounts Payable Turnover 15 18 21 N.A.
    Payment Days 15 15 15 N.A.
    Total Asset Turnover 3.5 3 2.5 N.A.
    Debt Ratios
    Debt to Net Worth 0 -0.14 -0.1 N.A.
    Current Liab. to Liab. 0 0 0 N.A.
    Liquidity Ratios
    Net Working Capital $160,000 $180,000 $20,000 N.A.
    Interest Coverage 0 0 0 N.A.
    Additional Ratios
    Assets to Sales 1.4 2.48 3.32 N.A.
    Current Debt/Total Assets 6% 4% 2% N.A.
    Acid Test 30 33 36 N.A.
    Sales/Net Worth 3.3 3 2.5 N.A.
    Dividend Payout 0 0 0 N.A.

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