Elite Personal Training

Critical Issues
 Immediate cash flow problems – even with the bank’s loan, Menard and Craciun do not
have enough money to purchase all the equipment necessary for their gym. Furthermore, if
they are unable to transfer their clients over from Body Worx, they will not have the cash
flows available to continue operations.
 Competition – there are already many, well-established competitors in London. Being able
to differentiate themselves and capture an acceptable cliental base will be very difficult.
Analysis
Current Situation
Martin Menard and Mirella Craciun are planning on leaving their current place of employment,
Body Worx to start their own personal training facility, Elite Personal Training in a niche
market. They plan to rent a small facility where they will renovate the space into two individual
gyms, allowing them to train two clients at a time. Offering the clients their own personal gym,
instead of training in a crowded facility, is Martin and Mirella’s way to try and differentiating
themselves in a very competitive and saturated market. London, Ontario has a wide range and
variety of fitness centre, with many offering personal training services. For Elite to be successful
they will need to sell their one-on-one, high end, training experience and capture a small portion
of the existing market.
Competitor Analysis
GoodLife, The Athletic Club
It is a company which is well established. When compare with Elite, consumers will have more
confidence in a company with multiple locations. The gym is available to customers to exercise
on their own at anytime without restrictions. The pricing structure for personal training is lower
than our proposed price of $60 per hour personal training (exhibits ###). Their locations are
spread throughout London, and it is convenience for user to exercise at any GoodLife locations,
which in contrast position Elite as inconvenience for users outside of the same area. Users have
to share the facility with other users and thus have little to no personal privacy. Also, the
qualities of the trainers are questionable due to the lack of certifications on some of them.
YMCA
It is a fitness and recreation centre where a variety of fitness classes are available such as boot
camps, yoga and martial arts1. Looking at Exhibit __, they price discriminate and have cheaper
rates for different groups of individuals hence having the ability to attract price sensitive
customers. However, the facilities of those gyms are small in size and are limited to operation
hours of each individual location. According the website, the trainers are usually uncertified and
with limited experience.
Independent Personal Trainers
Both Menard and Craciun’s current place of employment will be a direct competitor to Elite as
their business concept is from Body Worx. A similar or lower pricing structure will be needed to
help migrate clients from Body Worx clients to Elite. Other competitors such as Velocity provide
high end training equipments which will satisfy professional athletes at a higher price.
Consumers looking for this type of training are often values the personal one-on-on experience
with the trainer.
Market Analysis
Target Market
Business Professionals will be our main target market. They have higher than average income to
support their leisure activities2. Students who work in a part-time schedule will have to pay $480
up front, which will be considered a major portion of their disposable income ($40/section x 48
sections x 25%=$480).
Advertising Mix
Base on our research and analysis, a web page is the main media for advertisement for our
company. Business professional like to have details information to help with their decision
making process. So a website will serve that propose of having company information accessible
at all times. We will also suggest billboards in downtown area. The breakeven for a billboard
only requires one person to purchase one 48 sections packages per month (refer to exhibits _).
Criteria
Recommendations must meet the following criteria:
 Maintain a positive cash flow
 Pay the initial setup cost $48,777 by the first year
 Provide enough profit for owners to have a salary of $60,000 a year ($5,000 x 12months)
Alternatives
Do not start business
Martin and Mirella could choose to not start their own business. They currently have a very
strong client base with Body Worx and are therefore able to work consistent hours each week.
Starting Elite Personal Training would put them into a very competitive market where it is very

1
http://www.ymcawo.ca/cby_groupfit.html
2
http://www.canadavisa.com/canadian-salary-survey.html
difficult to differentiate yourself. Exhibit ## analysis shows that this market already has
established competitors and the variety of services they offer to the people of London, Ontario. If
they are unable to overcome this competition they will be forfeiting their current income for a
high risk, low return investment. According to their estimates, which can be seen in Exhibit##,
their first year of operations will suffer declining revenues throughout the year. If they cannot
secure new clients in year two their profits may not cover what they are currently making at
Body Worx (exhibits ##).

Wait till have enough money before commencing

Between Mirella’s $14,000 personal investment and the bank loan of $24,000, Elite does not
have enough money to pay for the start-up costs of opening their own personal training facility,
as shown in Exhibit ###. By postponing their venture and staying employed at Body Worx, they
can accumulate a higher initial personal investment, which will minimize the risk of starting this
business. However, by waiting they are allowing current competitors and possible new entrants
to capture more of the market share. Additionally, they are giving up the potential profits of
operating their own business.

Start the business (Lease finance/ Renting)

Through our analysis, the company will not have enough initial cash flow to start the business.
However, there are a few options that we have established to overcome those obstacles.
 Financing the equipment: It is not necessary for the company to pay for the equipment
costs at the point of purchase. The option of financing can spread the payments over the
course of the year when the first month is critical for the company (exhibits or footnote
for the financing info). Without financing, the company will have cash flow problem at
the beginning of first year operation. With financing, the company will have positive cash
flow (exhibits ##).
 Renting credit card machine: This method will allow the company to avoid the $5000
deposit for the first 6 months with a rental fee of $29 per month (matt’s website link).
This will further minimize the cash flow problem at the beginning of operation3.
 Starting the business early before the operation date is important. Before the opening day
in October, preparations such as renovations, financing the initial equipment, and renting
the credit card machine should be done before hand.
Expansion for Proposed 3rd Gym
While renovating the conference room into a third gym is not necessary immediately, once
Elite’s client numbers have grown and they can afford to have a third trainer working out of their
facility, expansion will allow them to continue growing their business. Based on our capacity
projections in Exhibit ##, we will need to open gym three by June 2007. They will be able to
hire another trainer at $15 per hour and continue bringing in new customers.
3
http://www.canadacardprocessing.com/merchant-account/dial-up-debit-machine/
Recommendations
 Start preparation in September 2005; open their new gym in October 2005.
 Target the professional as their main clients with mixed advertising strategies.
 Hire another trainer by Jun 2006 and expend into Gym 3.
 Exhibits 1: Cash flow statement - Forcast
Cash flow statement - Forcast
Sep-05 Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07
Inflows Initial Investment $ 14,000.00
Bank Loan $ 24,000.00
Cash Inflows $ - $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 12,960.00 $ 15,840.00 $ 18,720.00 $ 21,600.00 $ 24,480.00 $ 27,360.00 $ 30,240.00 $ 33,120.00 $ 36,000.00 $ 38,880.00 $ 41,760.00
Other Financing
Return of Deposit $ 5,000.00

Total Inflows $ 38,000.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 15,080.00 $ 12,960.00 $ 15,840.00 $ 18,720.00 $ 21,600.00 $ 24,480.00 $ 27,360.00 $ 30,240.00 $ 33,120.00 $ 36,000.00 $ 38,880.00 $ 41,760.00

Outflows Fixed
Initial Equipment $ 48,777.00
Loan Payments $ 586.00 $ 584.21 $ 582.42 $ 580.63 $ 578.83 $ 577.04 $ 575.25 $ 573.46 $ 571.67 $ 569.88 $ 568.08 $ 566.29 $ 564.50 $ 562.71 $ 560.92 $ 559.13 $ 557.33 $ 555.54 $ 553.75 $ 551.96 $ 550.17 $ 548.38 $ 546.58 $ 544.79
Rent $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00
Deposit on CC Machine $ 5,000.00
Alarm System $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00
Annual Insurance $ 1,619.00 $ 1,619.00 $ 1,619.00
Management Salary $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00
Cleaning $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00
Expansion $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 6,400.00 $ - $ - $ -
Tax Bill $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -

Varitable
Cards $ - $ 13.80 $ 13.80 $ 13.80 $ 13.80 $ 12.00 $ 12.00 $ 12.00 $ 12.00 $ 8.40 $ 8.40 $ 8.40 $ 8.40 $ 10.80 $ 13.20 $ 15.60 $ 18.00 $ 20.40 $ 22.80 $ 25.20 $ 27.60 $ 30.00 $ 32.40 $ 34.80
Water - 27.60 27.60 27.60 27.60 24.00 24.00 24.00 24.00 16.80 16.80 16.80 16.80 21.60 26.40 31.20 36.00 40.80 45.60 50.40 55.20 60.00 64.80 69.60
Parking $ - $ 552.00 $ 552.00 $ 552.00 $ 552.00 $ 480.00 $ 480.00 $ 480.00 $ 480.00 $ 336.00 $ 336.00 $ 336.00 $ 336.00 $ 432.00 $ 528.00 $ 624.00 $ 720.00 $ 816.00 $ 912.00 $ 1,008.00 $ 1,104.00 $ 1,200.00 $ 1,296.00 $ 1,392.00
Facility $ - $ 234.60 $ 234.60 $ 234.60 $ 234.60 $ 204.00 $ 204.00 $ 204.00 $ 204.00 $ 142.80 $ 142.80 $ 142.80 $ 142.80 $ 183.60 $ 224.40 $ 265.20 $ 306.00 $ 346.80 $ 387.60 $ 428.40 $ 469.20 $ 510.00 $ 550.80 $ 591.60
Extra Wages $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 600.00 $ 1,320.00 $ 2,040.00 $ 2,760.00 $ 3,480.00 $ 4,200.00 $ 4,920.00 $ 5,640.00

Total Outflows $ 64,625.00 $ 11,674.21 $ 10,053.42 $ 10,051.63 $ 10,049.83 $ 9,940.04 $ 9,938.25 $ 9,936.46 $ 9,934.67 $ 9,716.88 $ 9,715.08 $ 9,713.29 $ 9,711.50 $ 11,472.71 $ 9,995.92 $ 10,138.13 $ 10,880.33 $ 11,742.54 $ 12,604.75 $ 13,466.96 $ 20,729.17 $ 15,191.38 $ 16,053.58 $ 16,915.79
Net Cash -$ 26,625.00 $ 4,885.79 $ 6,506.58 $ 6,508.38 $ 6,510.17 $ 4,459.96 $ 4,461.75 $ 4,463.54 $ 4,465.33 $ 363.13 $ 364.92 $ 366.71 $ 5,368.50 $ 1,487.29 $ 5,844.08 $ 8,581.88 $ 10,719.67 $ 12,737.46 $ 14,755.25 $ 16,773.04 $ 12,390.83 $ 20,808.63 $ 22,826.42 $ 24,844.21
Cash Balance -$ 26,625.00 -$ 21,739.21 -$ 15,232.63 -$ 8,724.25 -$ 2,214.08 $ 2,245.88 $ 6,707.63 $ 11,171.17 $ 15,636.50 $ 15,999.63 $ 16,364.54 $ 16,731.25 $ 22,099.75 $ 23,587.04 $ 29,431.13 $ 38,013.00 $ 48,732.67 $ 61,470.13 $ 76,225.38 $ 92,998.42 $ 105,389.25 $ 126,197.88 $ 149,024.29 $ 173,868.50

Exhibits 2: Cash Flow - Alternatives Implemented

Cash Flow - Alternatives Implimented
Sep-05 Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07
Inflows Initial Investment $ 14,000.00
Bank Loan $ 24,000.00
Cash Inflows $ - $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 12,960.00 $ 15,840.00 $ 18,720.00 $ 21,600.00 $ 24,480.00 $ 27,360.00 $ 30,240.00 $ 33,120.00 $ 36,000.00 $ 38,880.00 $ 41,760.00
Other Financing
Return of Deposit $ 5,000.00

Total Inflows $ 38,000.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 10,080.00 $ 12,960.00 $ 15,840.00 $ 18,720.00 $ 21,600.00 $ 24,480.00 $ 32,360.00 $ 30,240.00 $ 33,120.00 $ 36,000.00 $ 38,880.00 $ 41,760.00

Outflows Fixed
Initial Equipment $ 23,077.00 $ 25,700.00
Loan Payments $ 586.00 $ 584.21 $ 582.42 $ 580.63 $ 578.83 $ 577.04 $ 575.25 $ 573.46 $ 571.67 $ 569.88 $ 568.08 $ 566.29 $ 564.50 $ 562.71 $ 560.92 $ 559.13 $ 557.33 $ 555.54 $ 553.75 $ 551.96 $ 550.17 $ 548.38 $ 546.58 $ 544.79
Rent $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00
Deposit on CC Machine $ 5,000.00
Credit Card Machine Rental $ 29.99 $ 29.99 $ 29.99 $ 29.99 $ 29.99 $ 29.99
Alarm System $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00
Annual Insurance $ 1,619.00 $ 1,619.00
Management Salary $ - $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00
Cleaning $ - $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00
Expansion $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 6,400.00 $ - $ - $ -
Tax Bill $ - $ - $ - $ - $ - $ - $ - $ 2,819.45 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 5,201.29 $ - $ - $ - $ -

Varitable
Cards $ - $ 13.80 $ 13.80 $ 13.80 $ 13.80 $ 12.00 $ 12.00 $ 12.00 $ 12.00 $ 8.40 $ 8.40 $ 8.40 $ 8.40 $ 10.80 $ 13.20 $ 15.60 $ 18.00 $ 20.40 $ 22.80 $ 25.20 $ 27.60 $ 30.00 $ 32.40 $ 34.80
Water $ - $ 27.60 $ 27.60 $ 27.60 $ 27.60 $ 24.00 $ 24.00 $ 24.00 $ 24.00 $ 16.80 $ 16.80 $ 16.80 $ 16.80 $ 21.60 $ 26.40 $ 31.20 $ 36.00 $ 40.80 $ 45.60 $ 50.40 $ 55.20 $ 60.00 $ 64.80 $ 69.60
Parking $ - $ 552.00 $ 552.00 $ 552.00 $ 552.00 $ 480.00 $ 480.00 $ 480.00 $ 480.00 $ 336.00 $ 336.00 $ 336.00 $ 336.00 $ 432.00 $ 528.00 $ 624.00 $ 720.00 $ 816.00 $ 912.00 $ 1,008.00 $ 1,104.00 $ 1,200.00 $ 1,296.00 $ 1,392.00
Facility $ - $ 234.60 $ 234.60 $ 234.60 $ 234.60 $ 204.00 $ 204.00 $ 204.00 $ 204.00 $ 142.80 $ 142.80 $ 142.80 $ 142.80 $ 183.60 $ 224.40 $ 265.20 $ 306.00 $ 346.80 $ 387.60 $ 428.40 $ 469.20 $ 510.00 $ 550.80 $ 591.60
Extra Wages $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 600.00 $ 1,320.00 $ 2,040.00 $ 2,760.00 $ 3,480.00 $ 4,200.00 $ 4,920.00 $ 5,640.00

Total Outflows $ 28,714.99 $ 10,085.20 $ 10,083.41 $ 10,081.62 $ 10,079.82 $ 9,970.03 $ 14,938.25 $ 12,755.91 $ 9,934.67 $ 9,716.88 $ 9,715.08 $ 9,713.29 $ 37,030.50 $ 9,853.71 $ 9,995.92 $ 10,138.13 $ 10,880.33 $ 11,742.54 $ 12,604.75 $ 18,668.24 $ 20,729.17 $ 15,191.38 $ 16,053.58 $ 16,915.79
Net Cash $ 9,285.01 $ 6,474.80 $ 6,476.59 $ 6,478.39 $ 6,480.18 $ 4,429.97 -$ 538.25 $ 1,644.09 $ 4,465.33 $ 363.13 $ 364.92 $ 366.71 -$ 26,950.50 $ 3,106.29 $ 5,844.08 $ 8,581.88 $ 10,719.67 $ 12,737.46 $ 19,755.25 $ 11,571.76 $ 12,390.83 $ 20,808.63 $ 22,826.42 $ 24,844.21
Cash Balance $ 9,285.01 $ 15,759.81 $ 22,236.41 $ 28,714.79 $ 35,194.97 $ 39,624.94 $ 39,086.69 $ 40,730.78 $ 45,196.11 $ 45,559.24 $ 45,924.15 $ 46,290.86 $ 19,340.36 $ 22,446.65 $ 28,290.74 $ 36,872.61 $ 47,592.28 $ 60,329.74 $ 80,084.99 $ 91,656.74 $ 104,047.57 $ 124,856.20 $ 147,682.62 $ 172,526.82
 Exhibits 3: Income Statment
Income Statement
Sep-05 Oct-05 Nov-05 Dec-05 Year End 2005 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Jun-06 Jul-06 Aug-06
Revenues Monthly Revenue $ - $ 16,560.00 $ 16,560.00 $ 16,560.00 $ 49,680.00 $ 16,560.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 14,400.00 $ 10,080.00 $ 10,080.00 $ 10,080.00
$ -
$ -
Expenses Fixed $ -
Loan Payments $ 86.00 $ 84.21 $ 82.42 $ 80.63 $ 333.25 $ 78.83 $ 77.04 $ 75.25 $ 73.46 $ 71.67 $ 69.88 $ 68.08 $ 66.29
Rent $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 13,412.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00
Rent on CC Machine $ 29.99 $ 29.99 $ 29.99 $ 29.99 $ 119.96 $ 29.99 $ 29.99 $ - $ - $ - $ - $ - $ -
Alarm System $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 200.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00
Annual Insurance $ 1,619.00 $ - $ - $ - $ 1,619.00 $ - $ - $ - $ - $ - $ - $ - $ -
Management Salary $ - $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 15,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00
Cleaning $ - $ 240.00 $ 240.00 $ 240.00 $ 720.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00
Ammortization $ 423.64 $ 423.64 $ 423.64 $ 423.64 $ 1,694.54 $ 423.64 $ 423.64 $ 423.64 $ 423.64 $ 423.64 $ 423.64 $ 423.64 $ 423.64
$ -
Varitable $ -
Cards $ - $ 13.80 $ 13.80 $ 13.80 $ 41.40 $ 13.80 $ 12.00 $ 12.00 $ 12.00 $ 12.00 $ 8.40 $ 8.40 $ 8.40
Water - 27.60 27.60 27.60 $ 82.80 27.60 24.00 24.00 24.00 24.00 16.80 16.80 16.80
Parking $ - $ 552.00 $ 552.00 $ 552.00 $ 1,656.00 $ 552.00 $ 480.00 $ 480.00 $ 480.00 $ 480.00 $ 336.00 $ 336.00 $ 336.00
Facility $ - $ 234.60 $ 234.60 $ 234.60 $ 703.80 $ 234.60 $ 204.00 $ 204.00 $ 204.00 $ 204.00 $ 142.80 $ 142.80 $ 142.80
Extra Wages $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Total Expenses $ 5,561.63 $ 10,008.83 $ 10,007.04 $ 10,005.25 $ 35,582.75 $ 10,003.46 $ 9,893.67 $ 9,861.89 $ 9,860.09 $ 9,858.30 $ 9,640.51 $ 9,638.72 $ 9,636.93

Earnings Before Tax -$ 5,561.63 $ 6,551.17 $ 6,552.96 $ 6,554.75 $ 14,097.25 $ 6,556.54 $ 4,506.33 $ 4,538.11 $ 4,539.91 $ 4,541.70 $ 439.49 $ 441.28 $ 443.07

Tax
Tax Bill $ - $ - $ - $ - $ 2,819.45 $ - $ - $ - $ - $ - $ - $ - $ -

Sep-06 Oct-06 Nov-06 Dec-06 Year End 2006 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07
Revenues Monthly Revenue $ 10,080.00 $ 12,960.00 $ 15,840.00 $ 18,720.00 $ 104,400.00 $ 21,600.00 $ 24,480.00 $ 27,360.00 $ 30,240.00 $ 33,120.00 $ 36,000.00 $ 38,880.00 $ 41,760.00
$ -
$ -
Expenses Fixed $ -
Loan Payments $ 64.50 $ 62.71 $ 60.92 $ 59.13 $ 580.50 $ 57.33 $ 55.54 $ 53.75 $ 51.96 $ 50.17 $ 48.38 $ 46.58 $ 44.79
Rent $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 26,824.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00 $ 3,353.00
Rent on CC Machine $ - $ - $ - $ - $ 59.98 $ - $ - $ - $ - $ - $ - $ - $ -
Alarm System $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 400.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00
Annual Insurance $ 1,619.00 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Management Salary $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 40,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00
Cleaning $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 1,920.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00 $ 240.00
Ammortization $ 363.14 $ 363.14 $ 363.14 $ 363.14 $ 3,389.09 $ 363.14 $ 363.14 $ 363.14 $ 363.14 $ 441.47 $ 441.47 $ 441.47 $ 441.47
$ -
Varitable $ -
Cards $ 8.40 $ 10.80 $ 13.20 $ 15.60 $ 87.00 $ 18.00 $ 20.40 $ 22.80 $ 25.20 $ 27.60 $ 30.00 $ 32.40 $ 34.80
Water 16.80 21.60 26.40 31.20 $ 174.00 36.00 40.80 45.60 50.40 55.20 60.00 64.80 69.60
Parking $ 336.00 $ 432.00 $ 528.00 $ 624.00 $ 3,480.00 $ 720.00 $ 816.00 $ 912.00 $ 1,008.00 $ 1,104.00 $ 1,200.00 $ 1,296.00 $ 1,392.00
Facility $ 142.80 $ 183.60 $ 224.40 $ 265.20 $ 1,479.00 $ 306.00 $ 346.80 $ 387.60 $ 428.40 $ 469.20 $ 510.00 $ 550.80 $ 591.60
Extra Wages $ - $ - $ - $ - $ - $ 600.00 $ 1,320.00 $ 2,040.00 $ 2,760.00 $ 3,480.00 $ 4,200.00 $ 4,920.00 $ 5,640.00
Total Expenses $ 11,193.64 $ 9,716.84 $ 9,859.05 $ 10,001.26 $ 78,393.57 $ 10,743.47 $ 11,605.68 $ 12,467.89 $ 13,330.09 $ 14,270.64 $ 15,132.84 $ 15,995.05 $ 16,857.26
$ -
Earnings Before Tax -$ 1,113.64 $ 3,243.16 $ 5,980.95 $ 8,718.74 $ 26,006.43 $ 10,856.53 $ 12,874.32 $ 14,892.11 $ 16,909.91 $ 18,849.36 $ 20,867.16 $ 22,884.95 $ 24,902.74
$ -
Tax $ -
Tax Bill $ - $ - $ - $ - $ 5,201.29 $ - $ - $ - $ - $ - $ - $ - $ -
 Exhibits 4: Amortization Table
Ammortization Table
Initial Loan Sep-05 Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07
$ 24,000.00 $ 23,500.00 $ 23,000.00 $ 22,500.00 $ 22,000.00 $ 21,500.00 $ 21,000.00 $ 20,500.00 $ 20,000.00 $ 19,500.00 $ 19,000.00 $ 18,500.00 $ 18,000.00 $ 17,500.00 $ 17,000.00 $ 16,500.00 $ 16,000.00 $ 15,500.00 $ 15,000.00 $ 14,500.00 $ 14,000.00 $ 13,500.00 $ 13,000.00 $ 12,500.00 $ 12,000.00 $ 11,500.00
$ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00 $ 500.00
$ 86.00 $ 84.21 $ 82.42 $ 80.63 $ 78.83 $ 77.04 $ 75.25 $ 73.46 $ 71.67 $ 69.88 $ 68.08 $ 66.29 $ 64.50 $ 62.71 $ 60.92 $ 59.13 $ 57.33 $ 55.54 $ 53.75 $ 51.96 $ 50.17 $ 48.38 $ 46.58 $ 44.79 $ 43.00
$ 586.00 $ 584.21 $ 582.42 $ 580.63 $ 578.83 $ 577.04 $ 575.25 $ 573.46 $ 571.67 $ 569.88 $ 568.08 $ 566.29 $ 564.50 $ 562.71 $ 560.92 $ 559.13 $ 557.33 $ 555.54 $ 553.75 $ 551.96 $ 550.17 $ 548.38 $ 546.58 $ 544.79 $ 543.00

Exhibits 5: Revenue Forecast

Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07
Total Packages 23 - - - 20 - - - 14 - - - 18 4 4 4 22 8 8 8 26 12 12 12

Total Cash Flow $ 16,560 $ 16,560 $ 16,560 $ 16,560 $ 14,400 $ 14,400 $ 14,400 $ 14,400 $ 10,080 $ 10,080 $ 10,080 $ 10,080 $ 12,960 $ 15,840 $ 18,720 $ 21,600 $ 24,480 $ 27,360 $ 30,240 $ 33,120 $ 36,000 $ 38,880 $ 41,760 $ 44,640

Total Revenue $ 66,240 $ - $ - $ - $ 57,600 $ - $ - $ - $ 40,320 $ - $ - $ - $ 51,840 $ 11,520 $ 11,520 $ 11,520 $ 63,360 $ 23,040 $ 23,040 $ 23,040 $ 74,880 $ 34,560 $ 34,560 $ 34,560

Initial Customers 23
2nd term growth rate 4

Exhibits 6: Operation Capacity

Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07
Used Capacity 276 276 276 276 240 240 240 240 168 168 168 168 216 264 312 360 408 456 504 552 600 648 696 744
Extra Labour 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 40 88 136 184 232 280 328 376 424

Weekly Capacity for Managers 80

Monthly Capacity for Managers 320

Facility Capcity per week (No gym 3) 170

Facility Capcity per month (No gym 3) 680
Facility Capacity per mont (No gym 3) 90% 612

Exhibits 7: Amortization
Ammortization Table Exhibits 8: Initial Equipment Exhibits 9: Gym 3 Cost
Fitness Equipment Year 1 Year 2
Treadmill $ 800.00 $ 480.00
Recumbrant Bike $ 280.00 $ 168.00
Fitness Equipment 3rd Gym addition
Elliptical Trainer $ 360.00 $ 216.00 Treadmill $ 2,000.00
Weight Training Equipment $ 1,080.00 $ 1,080.00 Recumbrant Bike $ 700.00
Training tools $ 100.00 $ 100.00 Elliptical Trainer $ 900.00 Flooring $ 1,200.00
Renovations and Office Equipment Weight Training Equipment $ 21,600.00
Office Equipment $ 300.00 $ 150.00 Spinning Bike $ 800.00
Training tools $ 500.00
Renos $ 900.00 $ 900.00
Flooring $ 936.33 $ 936.33 $ 25,700.00 Smith Cable Machines $ 2,000.00
Signage $ 267.50 $ 267.50 Bench $ 400.00
Mirrors $ 59.80 $ 59.80 Renovations and Office Equipment
Total $ 5,083.63 $ 4,357.63 Office Equipment $ 600.00
Weights $ 700.00
Renos $ 18,000.00 Weight Rack $ 300.00
3rd Gym addition Flooring $ 2,809.00
Flooring $ 400.00 Renos $ 1,000.00
Signage $ 1,070.00
Spinning Bike $ 320.00
Smith Cable Machines $ 100.00 Mirrors $ 598.00
Bench $ 20.00 $ 23,077.00
Weights $ 35.00
Weight Rack $ 15.00 Initial Equipment and Renovations $ 48,777.00
Total cost of Renovation $ 6,400.00
Renos $ 50.00
Total $ 940.00
 Exhibits 10: Competitors Analysis Exhibits 11: Target Market Analysis
Locations # of Fees Services Personal Hours Other Target Markets Analysis
members Training Business Professional  Higher than average income
 Have lots of people in nearby area
GoodLife 11 2000 x 11 $45-$60 per Gym, aerobic and weight-training $43-$60 6am-10pm weekdays, Not all trainers
month classes, pools, saunas per hour 6am-8pm Saturdays, were certified  Work time from 9am to 5pm
12pm-6pm Sundays  Will work out before work or after work
 Can implement fitness program with
The Athletic 2 8000 x 2 $35-$40 per Machines, aerobic classes, boxing ring, $43-$60 24 hours from Monday Women only corporate company
Club month pool, dance studios, squash courts per hour 5am to Saturday sections  $100000 income on average
Women  75% of clients are women
YMCA 5 $42 plus boot camps, yoga and martial arts $35-$40 Limited to different Discounts to
 Soccer Moms are free after 9am.
discounts per session locations low income
people  Result oriented and had weight-loss goals
 Like to work out in groups
TrueStar Health 2 1000 $38-$67 per One on one coaching on diet, nutrition  Self concise on their weight
for Women month and fitness Students  No constant income
 School facilities are free to use
Herbal Magic 800 Based on Natural herbal supplements. Products
 Price sensitive
products for weight management, health and
purchased energy, specific therapy and vitamins and  Most do not have driver license
minerals.  $480 first time cost for student with
student pricing ($40 per hr)
Retired People  Available all day
 Have high dependable savings
Curves 6 500x6 $39-$47 per N/A No personal  Can implement fitness program with
month training
elderly homes
Promotes  Can join program with insurance company
charities for therapy treatments
Semi Pro Sports Team  Have high budget for team training
Independent 3 $50-$85 Various Velocity offers  Huge client base from a single source of
Trainers per session state of the art sports team
centre  Need separate arrangement and
management on team training
Elite Personal 1 One on one training centres Monday-Friday, 6am-
Training 9pm. Saturday, 8am-  Long term cash inflow with contract
6pm. signed
Corporate Companies  Corporate support on employees work out
 Workout increases efficiency with
Exhibits 12: Promotion Analysis productions on the employees
 Many companies within the same building
Promotional Advantages Disadvantages ROI BE (Customers per duration or unit)
Item as the potential new training shop
Website  Virtual tour  High initial set up cost  High  $10,000/ $2,880  Convenience for the employees to work
 For quality-conscious  No direct target market out in the training shop
market (research)  Maintenance cost = 3.47 per development
 Reach a vast market
Highway  Focus on travelling  Hard to spot the signs  Low  $5,000/ $2,880
Signage people  Possible negative
 High exposure during impression when sign =1.74 per month
rush hours viewed during rush hours
Billboards  Concentrated in  High cost per each sign  Medium  $2,200/ $2,880
downtown area with  Limited space for signs
people that have above = 0.76 per month
average income
 Can been seen during
anytime of the day
Radio Spots  Wide reach  Limited air time  Medium  $200/ $2,880
 Educate public  No direct target market
 Build Brand = 0.07 per day
 Low per radio spot cost
Color Brochures  Convenience for  High cost per brochures  Low  $10,000/ $2,800
reference  Seen as spam or waste
 Competitors use =3.47 per 15,000 brochures
information for their own
Newspaper Ad  Hits target market  Low expose rate (once per  Medium  $5,000/$2,880
(professionals) week)
 Target at people with  Image quality of the news =1.74 per advertisement
high income paper will decrease (per week)
 Wide reach from attractiveness
reputable source *$5,000/115,000papers = $4.3 cents
per paper