Business plan on
Amusement park
Rohit pun
Bipin raj joshi
Karma ghale
June 15 2018
Table of content
Acknowledgement
Backgrounds of the company- basic site and business site of business
(location)
Vision and mission (long and short term objectives, create slogans)
Management team and organizational chart
Development timeline (GANTT CHART)
Marketing strategy- 4ps and targeted market
Porters 5 forces analysis
Financial plan- expenses and income list in detail, income statement
assets and liabilities in detail, balance sheet
Production process how production is carried out including input and
output
Legal requirements- company registration, VAT PAN no registration
Critical risk- evaluation mitigation
Contingency plan- alternative plan or plan B if first doesn’t work out
ACKNOWLEDGEMENT
I would like to express my special thanks of gratitude to my teacher saahil sir who
gave me the golden opportunity to do this wonderful project on the topic business
plan of amusement park, which also helped me in doing a lot of Research and i came
to know about so many new things I am really thankful to them
Secondly I would also like to thank my parents and friends who helped me a lot in
finalizing this project within the limited time frame.
Objectives
The company's objective is to build quality, full-service that will command the approval of
the community which it serves.
Our goals include:
1. A 10% market share in our first year.
2. An modest increase in our gross margins within the second year of operation
3. An increase in our market share by a minimum of 10% for each of our first five years.
Currently, there ARE no quality amusement park in Kathmandu, or the surrounding areas
(for a radius of 50 miles). The company believes that by entering the marketplace first and
by establishing quality facilities, it will become, and remain, a leader in the FEC industry
in the Kathmandu valley.
Our fundamental objective is to realize how we impact the community that we do business
in, knowing that we will stand the test of time if the local residents approve and support
our centre.
Mission
The sole purpose is to establish a profitable and well-managed company while at the same
time creating an atmosphere of fun and excitement for the entire family, with activities
designed to please the local residents, as well as the substantial tourist.
Keys to Success
Based on our research, our primary targeted market is parents and their children (ages 5-15
to 54). With that in mind, we intend to design our facilities to address this primary market,
while keeping in mind the secondary markets such a teens and young adults.
We believe that our main keys to success include:
Providing popular and wide-ranging entertainment activities
Ample and secure parking
Indoor activities for year round entertainment
The use of state-of-the-art technology
Easy access
Target high traffic areas for maximum public exposure
Design facilities to curb overcrowding
Seasoned management team
We believe that we can minimize certain risk factors by:
Initial capitalization of the company to sustain operations through year one
Low overhead through the use of multi-skilled employees and continual training
Strong customer base through aggressive marketing
Strong community ties and involvement
Eliminate collection costs by establishing cash/credit/debit card only facilities
GANTT CHART
Chart Title
22-May 11-Jul 30-Aug 19-Oct 08-Dec
Site inspection
Soil inspection
select a Contractor
Shop for finishes & material
Sign a Contractor
Start Building
Recruitment of staff
Opening ceremony
Shop for
Opening Recruitment Start Sign a select a Soil Site
finishes &
ceremony of staff Building Contractor Contractor inspection inspection
material
Start Date 15-Jul 08-Jul 01-Jul 21-Jun 15-Jun 05-Jun 31-May 22-May
Days to complete 7 10 150 20 14 30 15 50
Marketing Strategy
Our customers can come from all age groups, male and female, all races, every
income level and can be local residents or tourists to the area. That is why our
marketing plan started at the construction phase; by keeping in mind, if it looks fun
people will come. Thus the main factor to our success is simply that a person can
enjoy themselves at our centre while participating in an activity they choose.
Our full-time public relations manager is a vital part of our management team, by
assuring that customer satisfaction is provided and gathering information from the
public about the types of entertainment most desired. This can provide our company
with the means to stay in touch with the community and ready to meet their
desires.
1. Pricing Strategy
To establish the following detailed chart, we referred to several factory-pricing
recommendations and the local competition.
The following details our pricing and the # of customers per month that we used for
our cash flow projections. These projected numbers are 35% +/- of daily operation
capacity and being open for business 26 days a month, closed on Sundays. It should
also be noted, there maybe activities planned that are not included in our
projections.
- Price Quantity
Go-carts $5.50 7,000/month
Mini-golf $5.50 7,000/month
Driving range $5.50 560/month
Arcade and redemption $10.00 600/month
Sky-coaster $15.00 560/month
Batting cages and pitching lanes $1.00 1,620/month
Climbing walls $1.50 600/month
Bumper boats $4.50 560/month
Restaurant $3.75 10,500/month
Souvenirs $9.50 250/month
Party rooms $25.00 240/month
Air hockey and foosball $0.50 672/month
All business expenses are detailed in the financials topics. All other direct cost were
pre-calculated and added into the Sales Forecast table.
2. Promotion Strategy
Our first objective in promoting our centre will be to capitalize on the power of the
WORD OF MOUTH.
In every business it is a well-known fact that word-of-mouth advertising is any
businesses' best friend or worst enemy. Yet, this does not preclude the fact that
announcements, placing advertisements in the local newspapers and our future
planned website are not just as important in reaching new customers and will be
employed as follows:
Advertising
Getting our positioning message to the public, "family recreation," where fun and
customer service is paramount.
Utah's State Tourist Dept.
Keeping them aware of our centre and all current promotions.
Go-cart Track Signs
Local businesses can buy sign footage and have their signs placed around the track
like you would see around any race track.
Freeway & Site Signs
Self-explanatory.
Sales Brochure
informing the public of all the activities found and offered at the center.
Player Rewards
Rewarding customers for spending money through establishing frequent player
programs and sponsoring up to $50,000 a year towards prize money awarded
through tournament playoff prizes.
Community Involvement
the activities of the centre will be promoted as a place to bring your group to
participate in events and raise funds for "project name here." These types of fund
raising events can request that a portion of each players expenses be donated to
their organization (a standard amount will be established).
Target Market
A full-time public relations coordinator is a vital part of I & B INVESTMENTS'
management team. The job will require this person to be responsible for assuring
customer satisfaction, generating public awareness for the types of entertainment
offered at our "FEC," and attractively promoting the various activities to the public.
Even though, our customers can be considered all age groups, both sexes, all races,
all income levels, local residents or tourist to the area. The most important factor
behind our success is simply, THAT A PERSON CAN ENJOY THEMSELVES, while
participating in the activity they choose.
Porters 5 forces analysis
Financial Plan
It is anticipated that the multi-million dollar loan that the company will seek to
secure will cover the business start-up costs and provide funds for operating
expenses for the first year. Management projects that it will need to obtain
additional investment capital to fund the loan and long-term assets.
The Highlights chart that accompanies the Executive Summary sets forth the
company's anticipated profitability analysis. Management believes that even minimal
revenues should be sufficient to offer investors an acceptable return on investment.
Important Assumptions
NOTES FOR PROJECTIONS
All sales projections/assumptions are based on operating at 35% +/- of capacity.
Refer to the Sales Forecast topic for demographic break down and average cost per
person.
1. The figure of $890,000 shown in the Start-up Funding table under Current
Borrowing, is the start-up investment, amortized with a 19% interest
rate and paid off in five years.
2. Our long-term commercial loan is amortized at 10% interest over 20 years.
3. All pricing has been set by industry standards and the local market.
4. Revenues are strictly a projection based on gross possible players per venue and
then using 35% +/- of that capacity for our base calculation.
5. Contract services include: payroll, pest control, trash removal, cable TV.
6. Employees needed and wages have been projected for full time and eight hour
shifts. All payroll will be done through a payroll company, therefore giving a
flatter rate and making it easier to project.
7. Weber County tax rates are:
a. Real Estate tax $10.00 per $1,000 of assessed value.
b. Personal Property tax base is .009% of cost of equipment.
c. Business License is $50.00 for first 10,000 sq ft & $5.00 per every
additional 1,000 sq. ft. of building space.
8. The income tax rate is estimated before deductions and overhead assumptions
are included.
Table: General Assumptions
General Assumptions
Year 1 Year 2 Year 3 Year 4 Year 5
Plan Month 1 2 3 4 5
Current Interest Rate 19.00% 19.00% 19.00% 19.00% 19.00%
Long-term Interest Rate 10.00% 10.00% 10.00% 10.00% 10.00%
Tax Rate 32.75% 33.00% 32.75% 33.00% 32.75%
Other 0 0 0 0 0
Income statement
Important notes regarding Depreciation & Payroll Burden
1. The depreciation of assets was calculated separately from this Profit and Loss
statement. Due to the fact of some accounting issues pertaining to our industry
and this program. It appeared to be deducting our depreciation as hard cash
expenses and not soft money (tax deduction). Therefore the cash tables did not
appear to be reflecting a true statement of cash flow as per our industry (see
further explanation below).
2. Payroll Burden (overhead/taxes) has been excluded from the Profit and Loss table
based on the fact that payroll cost and taxes were pre-calculated and included in
the personnel plan table. The basic reason for us doing this is, we plan on using a
payroll company. Thus all employee payroll fees, taxes, insurances and other
payroll burdens are charged as a flat fee (our industry average fee is: wages +
15% +/- .5%).
As per depreciation figures, our preliminary assessment using a standard 200%
declining balance on equipment and assets gives us a first year figure of $190,000
+/-. This figure is considered our income tax deductible base and will adjust each
year depending on taxable items, gross income, actual values and depreciation of
assets.
Upon reviewing the next table (Profit & Loss), one should note that the company is
making a profit in the first month of operation. The yearly analysis is indicated in the
table below. The monthly analyses can be found in the appendix.
Chart: Gross Margin Yearly
Table: Profit and Loss
Pro Forma Profit and Loss
Year 1 Year 2 Year 3 Year 4 Year 5
Sales $3,561,108 $3,739,163 $5,795,703 $6,085,488 $6,389,763
Direct Cost of Sales $1,136,888 $1,193,733 $1,850,286 $1,942,800 $2,039,940
Operations Payroll $388,656 $408,089 $836,582 $878,411 $922,332
Known expenses $0 $0 $0 $0 $0
Total Cost of Sales $1,525,544 $1,601,821 $2,686,868 $2,821,211 $2,962,272
Gross Margin $2,035,564 $2,137,342 $3,108,836 $3,264,277 $3,427,491
Gross Margin % 57.16% 57.16% 53.64% 53.64% 53.64%
Operating Expenses
Sales and Marketing Expenses
Sales and Marketing Payroll $55,200 $57,960 $60,858 $63,901 $67,096
Advertising/Promotion $18,000 $18,900 $29,295 $30,760 $32,298
Travel $1,800 $1,890 $2,930 $3,076 $3,230
Miscellaneous $6,000 $6,300 $9,765 $10,253 $10,766
Total Sales and Marketing Expenses $81,000 $85,050 $102,848 $107,990 $113,389
Sales and Marketing % 2.27% 2.27% 1.77% 1.77% 1.77%
General and Administrative
Expenses
General and Administrative Payroll $171,120 $179,676 $326,605 $342,935 $360,082
Sales and Marketing and Other $0 $0 $0 $0 $0
Expenses
Depreciation $0 $0 $0 $0 $0
Utilities $14,400 $15,120 $23,436 $24,608 $25,838
Insurance $14,760 $15,498 $24,022 $25,223 $26,484
Telephone $9,600 $10,080 $15,624 $16,405 $17,225
Payroll Taxes $0 $0 $0 $0 $0
Other General and Administrative $0 $0 $0 $0 $0
Expenses
Total General and Administrative $209,880 $220,374 $389,687 $409,171 $429,629
Expenses
General and Administrative % 5.89% 5.89% 6.72% 6.72% 6.72%
Other Expenses:
Other Payroll $77,280 $81,144 $166,345 $174,662 $183,396
Consultants $0 $0 $0 $0 $0
Office Supplies $2,400 $2,520 $3,906 $4,101 $4,306
Postal Fees $1,800 $1,890 $2,930 $3,076 $3,230
Professional Fees $3,600 $3,780 $5,859 $6,152 $6,460
Housekeeping Supplies $12,720 $13,356 $20,702 $21,737 $22,824
Unknown $3,000 $3,150 $4,883 $5,127 $5,383
Bad Checks $600 $630 $977 $1,025 $1,077
Bank Card Fees $600 $630 $977 $1,025 $1,077
Business License $420 $441 $684 $718 $754
Facility Maintenance $18,000 $18,900 $29,295 $30,760 $32,298
Contract/Consultants $5,400 $5,670 $8,789 $9,228 $9,689
Total Other Expenses $125,820 $132,111 $245,344 $257,611 $270,492
Other % 3.53% 3.53% 4.23% 4.23% 4.23%
Total Operating Expenses $416,700 $437,535 $737,878 $774,772 $813,511
Profit Before Interest and Taxes $1,618,864 $1,699,807 $2,370,958 $2,489,505 $2,613,981
EBITDA $1,618,864 $1,699,807 $2,370,958 $2,489,505 $2,613,981
Interest Expense $519,346 $489,761 $670,033 $839,570 $797,376
Taxes Incurred $361,116 $399,315 $557,053 $544,479 $594,938
Net Profit $738,401 $810,731 $1,143,872 $1,105,457 $1,221,667
Net Profit/Sales 20.74% 21.68% 19.74% 18.17% 19.12%
Projected Balance Sheet
Estimated balance sheets for the years 2019-2020 including Phase 2 in the year are
provided below.
Table: Balance Sheet
Pro Forma Balance Sheet
Year 1 Year 2 Year 3 Year 4 Year 5
Assets
Current Assets
Cash $835,816 $776,910 $6,857,922 $7,625,035 $8,610,427
Other Current Assets $0 $0 $0 $0 $0
Total Current Assets $835,816 $776,910 $6,857,922 $7,625,035 $8,610,427
Long-term Assets
Long-term Assets $5,077,925 $5,077,925 $5,077,925 $5,077,925 $5,077,925
Accumulated Depreciation $0 $0 $0 $0 $0
Total Long-term Assets $5,077,925 $5,077,925 $5,077,925 $5,077,925 $5,077,925
Total Assets $5,913,741 $5,854,835 $11,935,847 $12,702,960 $13,688,352
Liabilities and Capital Year 1 Year 2 Year 3 Year 4 Year 5
Current Liabilities
Accounts Payable $75,702 $180,950 $268,064 $289,325 $298,783
Current Borrowing $772,146 $636,388 $472,466 $274,539 $207,414
Other Current Liabilities $0 $0 $0 $0 $0
Subtotal Current Liabilities $847,848 $817,338 $740,530 $563,864 $506,197
Long-term Liabilities $3,592,066 $3,526,940 $7,766,888 $7,605,210 $7,426,603
Total Liabilities $4,439,914 $4,344,278 $8,507,418 $8,169,074 $7,932,800
Paid-in Capital $965,000 $965,000 $1,739,000 $1,739,000 $1,739,000
Retained Earnings ($229,575) ($265,174) $545,557 $1,689,429 $2,794,886
Earnings $738,401 $810,731 $1,143,872 $1,105,457 $1,221,667
Total Capital $1,473,826 $1,510,557 $3,428,429 $4,533,886 $5,755,552
Total Liabilities and Capital $5,913,741 $5,854,835 $11,935,847 $12,702,960 $13,688,352
Net Worth $1,473,826 $1,510,557 $3,428,429 $4,533,886 $5,755,552
Legal requirements
A Private Firm has to follow the procedures below to register a business in Nepal.
According to Section 3 of the Private Firm Registration Act, 2014, the sole proprietorship business
institution needs to be registered either in Department of Commerce (in case of commerce related
firm), Department of Cottage and Rural Industry in the case of cottage and rural industry, and
Department of Industry for any other industry.
Any person who intends to register a private firm may submit an application in the prescribed legal
format to the relevant Department along with the prescribed official fee. The application should
contain the following information:
i. The name of the Private Firm
ii. The address of the Firm
iii. The objectives, functions and the particulars of goods or commodity to be transacted by the private
firm.
iv. The name and address of the owner, and the name of his/her father, mother and grandfather,
grandmother.
Registration Fee
Based on the capital of the firm, the registration fee needs to be paid which is as follows:
S.N. Capital (in NPR) Fee (NPR)
1. 1,00,000 or less 600
2. More than 1,00,000 and less than 3,00,000 2,000
3. More than 3,00,000 and less than 5,00,000 4,000
More than 5,00,000 and less than
4. 7,500
10,00,000
More than 10,00,000 and less than
5. 10,000
50,00,000
6. More than 50,00,000 15,000
NB: Certified copy of the Citizenship Certificate needs to be presented along with other essential
documents for the registration of the private firm.
Critical risk evaluation
People Are the Biggest Threat to Themselves
A quick Google search of Amusement Park Accidents and you’ll find lists of
horrible events, many of which lead to deaths. However, a close inspection
reveals that they are few and far between. Other lists show that many problems
that arise at theme parks come from people not taking the proper precautions
based on their own health. Parks enjoy their highest attendance during the
summer months when temperatures throughout the country rise to 90 degrees or
more, sometimes hitting triple digits. Combine that with paved walkways through
the park, that are normally blacktop and you have scorching heat that can really
take a toll on park visitors, especially those prone to heart issues. And yet many
people will enter a part ill prepared to adjust to the hot conditions. They will not
drink enough water, won’t wear the proper clothing, won’t remove themselves
from the heat nor will they take a break to cool off. The result is that security and
medical personnel are called on often to assist people who faint, get dehydrated
or worse yet, suffer a heart attack or other serious condition. Most, if not all, of
those situations could be avoided if people heeded warnings, and respected their
own limits. Operators must remember that many people will do neither.
People Will Sometimes Do the Wrong Thing
Several years ago at a theme park in Ohio, a woman was riding a modest version
of a flight simulator. The ride looked like a large octopus and at the end of each
“tentacle, ” there was a cockpit in which two people could sit. In between the
riders was a joystick that controlled the cockpit. Pull up...the tentacle and the
cockpit went up. Push down, they both went down. Move the stick to the left or
the right, and the cockpit would spin in that direction 360 degrees. So, riders
could spin themselves upside down if they wanted. This woman decided, since
she was not accompanied by another rider, to switch seats in the middle of the
ride. How she got out from under the shoulder harness is not known. What is
known is that at some point while making the move, she hit the joystick, causing
the cockpit to spin, turning itself upside down. With nothing holding her in, she
fell and hit the pavement below, suffering injuries that eventually lead to her
death. An autopsy further revealed that she had a very high blood alcohol content
level. It is this kind of unanticipated event, caused by a lack of judgement by the
park visitor, that creates the most stress for a park operator.
Preparing for the Worst
While no one can predict the type of situation described above, amusement park
operators must still be prepared for critical incidents. We work with theme parks
throughout the world to help them develop a crisis management plan. The first
step is to identify threats. We look to determine where the park is vulnerable to
foul play or at the extreme, an attack. Many times, we find that a fresh set of eyes
and ears can discover vulnerabilities that had long been ignored since “nothing
ever happened there before.” Maybe it’s an old fence that could easily be passed
through or a system of checking employee IDs that isn’t being thoroughly
enforced. As we list the threats, we look then at what the risk levels are. If there is
a back door to a building that opens to the outside of the park, and there is no
surveillance in place, what are the risk scenarios that could create big problems?
For example, an inside employee could open the door and let outside accomplices
into the park undetected as part of a theft ring. Anticipating threats and knowing
what risks they pose helps to determine the priorities for which issues to tackle
first.
