1.0 Executive Summary
The purpose of this business plan is to secure $3.5 million a capital for the development of an ice skating rink based in Marquette County, Michigan. Ice Skating Rink LLC (“the Company”) was founded this year with the intention of providing an exceptional facility for general enjoyment of ice skating as well as participation in ice hockey. Full scale revenue generating operations will commence next year once to build out of the facility is completed.
Operations
The primary revenue center for the business will come from the ongoing admission fees that are generated among the general public and among people that want to participate in ice skating. The Company will provide full day passes for $20, which is affordable for the Marquette County market.
The Company will also produce significant income from hosting ice skating tournaments and leagues at the facility. The Company will coordinate with individuals that will participate in these leagues on an ongoing basis. The Company will produce highly recurring reams of revenue from these operations.
The Company will also produce significant income from event hosting as well as the sales of concession as the tertiary revenue centers.
The third section of this ice skating rink, business plan will further document the operations of the business.
The Financing
At this time, the Company is seeking $3.5 million of debt capital for the development of the Company’s location in Marquette County. This ice skating rank business plan assumes that the Company will receive a 25-year loan carrying a 7% interest rate. The Founder will contribute $500,000 towards the venture.
The Future
Over the next five years, the Company will make ongoing reinvestment into its marketing campaign so that the business is the preeminent ice skating rink within Marquette County. The Company will also coordinate with regional schools so that hockey leagues and tournaments can be hosted at the Company’s centralized location in Michigan. After the fifth year of operation, the Company may establish additional ice skating rinks.
Market Overview
Revenue Forecasts
2.0 The Financing
2.1 Funds Required
The funds discussed in the executive summary will be allocated as follows:
2.2 Management and Investor Equity
The Founder is the 100% owner of Ice Skating Rink LLC.
2.3 Exit Strategies
In the event that is financially prudent to do so, the Company could easily be sold to a third-party for a significant premium. As the business will have a number of high margin streams from its ice skating rink operations, this business would be in demand among entrepreneurs that focus on sports facilities. In this event, the Company will coordinate with both a real estate brokerage as well as a business brokerage to find a suitable buyer for the business. This is not expected to occur for a significant period of time.
3.0 Operations
As discussed in the executive summary, the ice skating rink will be actively involved with providing a wide range of services from its easy to reach location in Marquette County. The general admission revenues will always remain as the most important revenue center for the business as ice skating is very popular in this market. The Company will offer full day passes so that individuals can come and go as they please throughout the course of the day.
Event hosting will also be an incredibly important part of the Company’s operations as this will not only produce a significant amount of revenue, but it will also familiarize people with the ice skating rink location. It is expected that events will span birthday parties as well as corporate events.
The Company will also produce a significant amount of income from the ongoing league hosting in tournament hosting that will occur on site. As there are only a limited number of ice skating rinks in the target market radius, Management sees a significant opportunity to produce highly predictable reams of revenue from these operations.
4.0 Overview of the Organization
4.1 Registered Name
Ice Skating Rink LLC. The Company is registered as a limited liability company in the State of Michigan.
4.2 Commencement of Operations
The Company in hence launch operations next year.
4.3 Mission Statement
To provide and affordable ice skating experience for the general public while concurrently hosting ice hockey leagues.
4.4 Vision Statement
To operate as the preeminent ice skating rink within the Marquette County area.
4.5 Organizational Objectives
• Properly conduct a build out of the location once the capital has been secured.
• Establish ongoing relationships with athletic directors within the target market radius.
• Implement numerous marketing strategies that will create significant visibility during the development.
• Maintain fiscally sound protocols at the business remain profitable at all times.
• Adhere to all laws regarding the operation of ice skating rinks.
• Implement numerous policies so that a substantial degree of safety is afforded to all patrons.
5.0 Market and Industry Analysis
5.1 External Environmental Analysis
This section of the ice skating rink business plan will focus on the current economic climate, the industry, the customer profile, and the ongoing competition that the business will face.
At this time, the ongoing economic condition United States is moderate. As a result of changing trade policies, there has been a significant degree of inflation introduced into the economy. It should be noted that the Federal Reserve is taking appropriate measure in order to ensure that inflation comes down while allowing the economy to continue to grow.
The Company will be able to remain economically viable, even during an economic recession, given an ice skating is a low cost for of entertainment. Additionally, league hosting and tournament management will also produce significant streams of highly predictable revenue. The business will have controllable fixed operating costs.
5.2 Industry Analysis
As of this year, there are 2,600 companies that provide access to ice skating rinks within the United States. These businesses aggregately generate $850 million of revenue. The growth rate of the industry is expected to remain similar to that the economy is a whole.
5.3 Customer Profile
Any individual that has an interest in skating or ice hockey is a potential customer for the business. The enjoyment of the sport spans the entire socioeconomic spectrum. Generally, these individuals will have a household income exceeding $60,000 and they will live within 15 miles of the Company’s location.
5.4 Competitive Analysis
The business will face modest competition as a establishes its ice skating rink operations within Marquette County. The scale and scope of the Company’s operations will provide a significant differentiating factor.
6.0 Key Strategic Issues
6.1 Sustainable Operations
Ice Skating Rink will have sustainable operations as a result of the following:
• Highly predictable reams of revenue spanning a number of different income centers.
• The property will appreciate substantially during the time it is held.
• The business can introduce new services such as ice hockey and ice skating training to boost revenue.
• Relatively controllable operating cost as a function of revenue (with the exception of energy pricing),
6.2 Basis of Growth
The Company will expand via the following methods:
• Continued expansion, the Company’s direct outreach initiatives with athletic directors and ice hockey coaches.
• Integration of on-site training services in conjunction with third-party trainers.
• Organic growth through continued expansion the Company’s marketing campaigns.
7.0 Marketing Plan
7.1 Marketing Objectives
• Implement a number of marketing strategies that will create significant awareness prior to the launch of the business.
• Use both search engine optimization and targeted social media for the Company’s website.
• Establish ongoing relationships with regional schools in Marquette County.
7.2 Revenue Forecasts
7.3 Revenue Assumptions
Year 1
• The ice skating rink will generate $1.8 million in the first year.
• Gross profits will reach $1.7 million.
Year 2
• The business will expand the scope of its marketing operations.
• Revenue will reach 2.04 million.
Years 3-5
• By Year 5, total revenue will reach $2.59 million.
• Gross profits will reach $2.4 million.
7.4 Marketing Strategies
The Company will use numerous marketing strategies to create significant awareness for the ice skating rink in the coming months and years. Most importantly, the Company will conduct extensive pre-launch marketing so that people in the area are familiar with the Company’s operations prior to launch. This will include conducting extensive direct outreach with athletic directors and ice hockey coaches during the buildout process. Given the size and scope of the location, it is expected to become a well-recognized landmark within the area.
In regards to the Company’s website, this platform will showcase all aspects of the ice skating rink’s operations. This will also include e-commerce functionality so that individuals can purchase ongoing passes directly online. This platform will undergo search engine optimization specific for the Marquette County market.
The Company will also maintain an expansive presence on all social media platforms to create brand awareness. The business will launch its social media operations during the buildout phase so that individuals and families are aware of the ice-skating rink development on Facebook, Instagram, X, TikTok, and YouTube. The Company will post ongoing images and videos of the facility will also offer a number of specialized deals on an ongoing basis.
The Company will also foster ongoing relationships with hockey coaches and athletic directors in this market. This will allow for more rapid on boarding of individuals that will participate in leagues and tournaments onsite.
8.0 Organizational Plan
8.1 Organizational Hierarchy
8.2 Personnel Costs
9.0 Financial Plan
9.1 Underlying Assumptions
• The Company will have a compounded annual growth rate of 7.6%.
• Management will contribute $500,000 towards the development of the ice skating rink.
• The Company will acquire a loan of $3.5 million.
9.2 Financial Highlights
• The Company achieve contribution margins of 95% on admission and hosting of tournament events.
• Events and concessions will generate contribution origins of 75%.
9.3 Sensitivity Analysis
The Company will be able to thrive in any economic climate given that going to an ice skating rink is a low-cost form of entertainment. The business will have multiple high margin, revenue centers including event hosting, tournament hosting, league management, and concessions. This ecosystem will allow the business to remain profitable at all times.
9.4 Source of Funds
9.5 Financial Proformas
A) Profit and Loss Statement
B) Common Size Income Statement
C) Cash Flow Analysis
D) Balance Sheet
9.6 Breakeven Analysis
9.7 Business Ratios
Appendix A – SWOT Analysis
Strengths
• Significant demand in Marquette County for access to affordable ice skating rink facilities.
• League hosting and tournament hosting will produce significant visibility for the business.
• The Founder has extensive experience as a hockey coach.
Weaknesses
• Moderate high cost related to energy.
• General operational complexities given the scope of the ice skating rink’s operations.
Opportunities
• Potential development of additional locations.
• Continued to expansion of the Company’s direct outreach initiatives with athletic directors and ice skating coaches.
• Yearly increases in price to keep pace with inflation.
Threats
• Continually spiking energy prices could cause the underlying cost of the business to increase significantly.
Appendix B – Risk Analysis
Development Risk – Low
The Company has already developed the architectural plans and engineering plan to develop the ice skating rink. The primary matter that needs to be addressed to securing the funding sought in this document.
Financing Risk – Low/Moderate
The $3.5 million of debt will be principally used for the development of the Company’slocation as well as furniture, fixtures and equipment. These risks are reduced by the multiple revenue centers showcase in this document.
Marketing Risk – Low
The Company will implement numerous marketing strategies to create brand visibility during the buildout phase as well as throughout the life of the business. These risks will be tempered through the direct outreach initiatives discussed earlier.
Management Risk – Low
The Founder is a highly experienced hockey coach that will be able to quickly bring the operations of the ice skating rink to profitability.
Valuation Risk – Low
The valuation risk is offset by:
• The property will appreciate a rate of 3% per year during the time it is held.
• Limited economic risks.
• The business is expected to generate a substantial return on investment.
Exit Risk – Low
As noted earlier, a qualified business broker and real estate broker would be hired to find a suitable buyer for the business. The Founder has no intention of digesting this Company for at least fifteen years.