MusicWest

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Musical Instrument Store Business Plan

Company Summary

MusicWest is a retailer of musical instruments and their accessories, located on Albuquerque's Westside. MusicWest will differentiate itself from its direct competitors by marketing the store's educational approach, and one of the most hands-on store layouts of its type in Albuquerque. In addition, we will offer a wider selection of products, and more services to reward customer loyalty, than our competitors.

2.1 Start-up Summary

Start up costs will cover all inventory, site modification, website creation, necessary equipment and the necessary capital to fund operation of the business through the first year. In particular, we foresee a need for substantial initial working capital with a large purchase of initial inventory to sufficiently maintain and grow the business. We intend to secure financing through conventional lending sources or with a (7A) conventional SBA loan guarantee. The balance of the funds will be covered by owners investment.

Start-up
Requirements
Start-up Expenses
Legal $1,000
Stationery etc. $500
Space Renovation/Preparation/Signage $20,000
Miscellaneous Expenses $1,500
Insurance $500
Rent & Deposits $4,000
Pre-Opening Salaries $4,000
Phone System $2,500
Other $0
Total Start-up Expenses $34,000
Start-up Assets
Cash Required $68,500
Start-up Inventory $150,000
Other Current Assets $0
Long-term Assets $7,500
Total Assets $226,000
Total Requirements $260,000
Start-up Funding
Start-up Expenses to Fund $34,000
Start-up Assets to Fund $226,000
Total Funding Required $260,000
Assets
Non-cash Assets from Start-up $157,500
Cash Requirements from Start-up $68,500
Additional Cash Raised $0
Cash Balance on Starting Date $68,500
Total Assets $226,000
Liabilities and Capital
Liabilities
Current Borrowing $0
Long-term Liabilities $200,000
Accounts Payable (Outstanding Bills) $0
Other Current Liabilities (interest-free) $0
Total Liabilities $200,000
Capital
Planned Investment
Investment by Dave & Kayle Moore $50,000
Investment by Ray Himes $10,000
Additional Investment Requirement $0
Total Planned Investment $60,000
Loss at Start-up (Start-up Expenses) ($34,000)
Total Capital $26,000
Total Capital and Liabilities $226,000
Total Funding $260,000

2.2 Company Locations and Facilities

We have chosen a site at Ladera Shopping Center on Coors Blvd. near I-40 for several reasons:

  • Close proximity to Interstate 40.
  • Safe and plentiful parking area.
  • Near high-traffic tenants such as Home Depot and Staples, and anchored by a WalMart Supercenter.
  • Beneficial demographics: over 150,000 households within a 5-mile radius, 85,000+ cars per day on the two cross-streets, and no direct competitors within 10 miles.

All of the above qualities are consistent with MusicWest's goal of providing a fresh approach to musical instrument retailing. We are looking at leasing approximately 3,500 sq.ft. of space, which will allow sufficient room for up to six lesson studios, a repair area and necessary storage and office space. We expect usable selling space to end up being around 2,400 sq.ft.

2.3 Company Ownership

MusicWest will be a partnership. The principles of the business are Kayle and David Moore. Kayle Moore will assume the position of President/Office Manager, while David Moore will assume the duties of Store Manager.