04/18/23 Group 10 1

Chad Sexington’s Health & Fitness Center

Prepared by: Lorraine Harty Clarisse Fan Jesse Varner Chris Harker

Mark Markovik Jim Craven

04/18/23 Group 10 2

Agenda• Executive Summary• Management Team • Business Objective• Selection of Location• Physical Facilities• Financing• Personnel• Marketing Approach• Conclusion

04/18/23 Group 10 3

Executive Summary

• New Health and Fitness Center • Located in South Lethbridge• Employing 20 Full/ Part employees• Will be managed by Chad Sexington• Provide a friendly weight loss environment• Targeting families, non-traditional gym users,

and the over-weight

04/18/23 Group 10 4

Management Team

• Chad Sexington– was overweight as a

child – has an MBA from

Berkley– would like to help

others who are like he once was

– independently wealthy

– moved to Lethbridge because of his wife

Before After

04/18/23 Group 10 5

Agenda• Executive Summary• Management Team • Business Objective• Selection of Location• Physical Facilities• Financing• Personnel• Marketing Approach• Conclusion

04/18/23 Group 10 6

Business Objective

• Short-term goal (1-2 yrs) – determine method of financing– obtain a maximum of 600 members

• Medium-term goal (3-5 yrs)– increase market share– obtain positive returns on investment

(ROI)

04/18/23 Group 10 7

Business Objective, Cont’d

• Long-term goal (5-10 yrs)– achieve at least 10% ROI– future expansion– 1,000 -1,500 members

• Long-term Real Estate investment– appreciable land– prime location

04/18/23 Group 10 8

Location - Trading Area and Population for Lethbridge and Area

http://www.ecdevlethbridge.com/lifestyle/recreation.asp

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Location - City of Lethbridge

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Specific Site Location - Fairmont Blvd. S./

Mayor Magrath Dr.

N

EW

S

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Accessibility

• Accessible from Fairmont Blvd off of Mayor Magrath Drive

• High traffic flow– Wal-Mart– Costco– Safeway– Wholesale Sports

04/18/23 Group 10 12

Proximity to Other Businesses

• Closest gym located is Gold’s Gym

– Competitive Bodybuilders– Professional weight lifters– Younger clientele

Outward appearance concerns

04/18/23 Group 10 13

Physical Characteristics of the Site

• The gym will require:– 1 acre (43,560 square feet) of

undeveloped land (Fairmont Business Park)

– Opening onto Fairway St. South– Large parking lot – Equipment

04/18/23 Group 10 14

Building NeedsCost Per Sq/Ft.

Square Feet

Total Cost

Cost of Land $15 43,560 $653,400.00

Cost of Building $175 8,000 $1,400,000.0

0

Total Cost    $2,053,400.

00

Cost of Land & Building

04/18/23 Group 10 15

Equipment Needs: Units Price Total

Treadmills 8.00

$ 2,500.00

$ 20,000.00

Elipticals 8.00

$ 2,500.00

$ 20,000.00

Bikes 10.00

$ 1,200.00

$ 12,000.00

Stair Climbers 8.00

$ 1,200.00

$ 9,600.00

 

Benches 10.00

$ 500.00

$ 5,000.00

Hammer Strength 10.00

$ 2,500.00

$ 25,000.00

Universal Cable 2.00

$ 5,000.00

$ 10,000.00

Dumbbells 2.00

$ 5,000.00

$ 10,000.00

Weight 5,000.00

$ 1.50

$ 7,500.00

Cages 3.00

$ 1,500.00

$ 4,500.00

Barbells $ 8,000.00

Cost of Equipment

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Cost of Equipment (cont.)

Equipment Needs: Units Price Total

Washing Machine

1.00 $

5,000.00 $

5,000.00

Dryer

1.00 $

5,000.00 $

5,000.00

   

Linen $

5,000.00

Office Equipment $

8,500.00

Miscellaneous $

45,000.00

   

Total Equipment Needed    

$ 200,100.00

04/18/23 Group 10 17

Initial Cost Requirements

• Initial cost requirements for a Gold's Gym: – $500,000 to $2,400,000 USD– $25,000 USD Franchising fee

the facility size area of the market pre-opening expenses inventory fitness equipment signage

(www.goldsgym.com)

04/18/23 Group 10 18

Physical Facilities (outside)

Property Layout – Parking Lot and Building43,560 sq. ft.

PARKING

LOT

SIDEWALK

W

NS

E

360 ft.

121 ft.

250 ft.

NAME OF GYM

ENTRANCE

100 ft.

80 ft.

04/18/23 Group 10 19

Physical Facilities(inside – level 1)Building Layout – 8000 sq. ft.

Entrance

Help DeskSpecialist

Strength

Equipment

Training Room #1

Supplement and

Specialty Store

Maintenanc

e/Janitorial R

oom

Men’s Change Rooms

Lady's Change Rooms

Sauna

Sh

ow

ers

Sauna

Storage and

Laundry

W

NS

E

Stretching A

rea100 ft.

80 ft.

Stairway

Training Room #3

Training Room #4

Training Room #2

Cardiovascular Equipment

04/18/23 Group 10 20

Physical Facilities (inside – level 2)

Building Layout – 8000 sq. ft.

Physical Therapy

Nutritionist/ DieticianDay Care

Lunchroom

Specialist Medical

Assessments

W

NS

E

100 ft.

80 ft.Stairway

OfficesMassage Therapy/

Acupuncture

Hallway

04/18/23 Group 10 21

Agenda• Executive Summary• Management Team • Business Objective• Selection of Location• Physical Facilities• Financing• Personnel• Marketing Approach• Conclusion

04/18/23 Group 10 22

Financing

• Pro-Forma Income Projection– 2006 – 2010 sensitivity analysis– Pro-forma projections

• Pro-Forma Cash Flow Projection– 2006 – 2010 sensitivity analysis– Pro-Forma projections

04/18/23 Group 10 23

Financing

• Market Potential= $ 6,014,721.00

• Market Share= 10.57%

• We chose to incorporate primarily:– Insulate ourselves from liabilities

04/18/23 Group 10 24

Personnel

• Organizational Chart

Mr. Sexington

Membership Coordinators

Trainers andInstructors

Counter Representatives

Book Keeper

04/18/23 Group 10 25

Personnel

• Administrative Structure– 10 part-time trainers/fitness instructors– 5 part-time front desk employees– 3 part-time membership coordinators– 1 full-time bookkeeper– 1 general manager

• Operating Hours– 6:00 a.m. ~ 11:00 p.m. daily

04/18/23 Group 10 26

Agenda• Executive Summary• Management Team • Business Objective• Selection of Location• Physical Facilities• Financing• Personnel• Marketing Approach• Conclusion

04/18/23 Group 10 27

Market Product Focus• Target Market

– overweight or obese people– people who have not used gyms before– had negative experience with gyms in the past– family oriented

• Geographic Segmentation– Lethbridge and surrounding trade areas

• Demographic Segmentation– any gender at any age– postsecondary or above educated people– mainly those in the middle to high income bracket

04/18/23 Group 10 28

Market Product Focus

• Psychographic Segmentation– Sedentary lifestyle – Personality

• achievement-oriented• not active

• Behavioural Segmentation– Benefit Sought

• friendly, non-threatening and professional atmosphere – User Status

• first time user and regular user– Loyalty

• strong

04/18/23 Group 10 29

Market Product Focus

• Purchase Characteristics– what:

• quality of programs, facilities and staff

– when: • before summer or after Christmas time

– why: • looking for fun and enjoyable weight loss

environment as part of maintaining a healthy lifestyle

04/18/23 Group 10 30

SWOT Analysis

Strengths Weaknesses• unique, professional and high quality family-orientated fitness center• qualified instructors offering a variety of group classes • medical assessment

• lack of reputation• market saturation• uncertainty of the target market• difficult to find a profitability model

04/18/23 Group 10 31

SWOT Analysis

Opportunities Threats• new exciting fitness center • little or no competition• provide new equipment and educated staff and instructors

• new market attract new competitors• technology changes rapidly • consumers refuse to change

04/18/23 Group 10 32

Marketing MixPrice Place•$55/month per person•$7/use per person

•Our Own Space•South End of Lethbridge•Lease Space Out

Product/Service Promotion•Fitness Center•Offer variety of services and equipment in one convenient location

•Advertising•Partnership with healthy weight loss centers and senior centers•School Workshops •Word of Mouth

04/18/23 Group 10 33

Conclusion

• Not just a gym – whole family fitness

• Long term real estate investment• Expected profit after 3 years• Chad’s passion and Lethbridge’s

need for all encompassing, one stop health center will ensure the success of this venture