The purpose of this business plan is to secure a seven-hundred thousand dollar ($700,000 to $800,000) conventional business loan from a financial institution in order to purchase the assets of the business known as Sportsuchtig. It will be purchased by Johnson Sporting Goods, LLC, a limited liability company formed for this purpose by John and Lisa Johnson. The business will continue to be known and operated as Sportsuchtig.
Sportsuchtig sells quality sporting goods equipment for the entire family, primarily focused on and specializing in baseball and softball equipment, apparel and accessories from major manufacturers such as Easton, Louisville Slugger, Wilson, Worth, Mizuno, Miken, and Under Armour. The company was established as a retail store in 1986 and created an Internet sports store in 1996. The company currently operates with 10 employees out of a 7,400 square foot facility which houses the combined retail store, call center, office, and product warehouse. Over the last 3 years the company has averaged $2.5 million in sales and a gross margin of 25%, with 52% of the sales generated by the website and 48% coming from the retail store.
In the last 3 years, Sportsuchtig has generated verifiable pre-tax income averaging $194,000 and total owner's benefit averaging over $323,000. This is a strong business that is positioned well for accelerated growth. We believe the business can reach revenue levels of over $5 million in 5 years by implementing this business plan. Sales are projected to be flat in year one and then grow at 20% in years 2-5. This growth forecast is based on the assumption that the company acts on these key opportunities:
We will plan to relocate the business near the end of year 1 which should help position us for increased retail sales beginning in year 2. The website will be redesigned in the first 6 months and the Web marketing strategy will be timed to coincide with the implementation of the new site. Expansion into at least one new product participant segment will be planned for each year, beginning in year 1. An outside sales team manager will be hired in year 1, but ramp-up of the sales team is not planned until early in year 2.
The business will be managed by owner John Johnson who will act as President and CEO. Mr. Johnson's high technology and sports business backgrounds, coupled with his entrepreneurial experience, makes him the ideal leader to drive this sporting goods retail/internet endeavor. He spent almost 20 years leading research and development efforts for high technology stalwarts such as Lucent Technologies and ;Motorola Systems, and was a founding employee and Vice President of a high-tech startup. Mr. Johnson also founded and currently owns two other businesses, Johnson Enterprises, LLC and Johnson Investments, LLC. Johnson Enterprises, LLC sells, designs, and constructs custom game courts (basketball, tennis, etc.), synthetic putting greens, and sporting goods products. Mr. Johnson received a Bachelor of Science in Computer Science from Stone College in Boulder, Colorado and a Masters in Business Administration from the University of Illinois.
To become the sports equipment supplier of choice, based on product expertise, price, quality, and level of service, by developing a long term relationship with our customers. Become the "family expert" for sporting goods equipment by treating customers like friends and family and by maintaining an experienced, knowledgeable, and caring staff that can help the customer make the right purchase for them, whether they are individuals outfitting their family, or coaches, athletic directors and league representatives supplying their teams.