Analysis of Gym Equipment Venture - Business Plan Example

Business Plan For an online venture Beauty Fitness Introduction More and more people are looking into home gym equipments nowadays. Busy schedules hinder the average adult from being able to workout in a gym or at workout center. Seizing the opportunity, gym equipment units are opened that are into the full-fledged business of selling the home gym equipments. There are some units which claim to give the same quality workout that the one could receive in a fitness center. More, the Internet has dramatically changed peoples' shopping habits. From CDs to Jet planes, buyers are enjoying their convenience of making their purchases from home or while in the office. Purchasing fitness equipment online too, has grown substantially over the last several years. From numerous infomercial products to high-end home exercise equipments, the Internet provides the medium for detailed information on the benefits and features of each product. As people overcome their fear of cyber shopping, they are learning that the Internet offers both - the convenience and the savings. Convenience comes from comparative shopping without having to travel to numerous fitness equipment stores, where you often deal with unknowledgeable sales representatives. The Internet has empowered the consumer with detailed product information, allowing them to make intelligent purchasing decisions. In addition, the Internet provides an opportunity to avoid the added costs incurred through purchases at retail stores. A percentage of any price tag at a store includes overhead costs like leasing prime space, employee wages and inventory. The Internet is changing the rules, and online purchases can result into significant savings on items like fitness equipments. Business name Beauty Fitness Analysis of the current business position Although people, mostly youngsters, have become much more fitness conscious than ever - a few online shops are existent on world wide web, selling home gym equipments. As the conventional stores require Customers to step in to the physical premises at least once, there can be a big drop in the number of daily visitors. More, gym equipments aren't the products that can be marketed door-to-door, offering a live demo of an actual product right there. Hence, the current business position clearly speaks the need of a selling media from where the good number of customers can be reached on an everyday basis. Thus, e-shops are an opportunity. Else, the Internet websites already existing in the market selling home gym equipments, aren't yet covering the whole of potential customers. They are often into a part-time business of selling products via Internet, over and above having their conventional exhibition center - and hence, their business models are not probably as powerful as what a full-fledged Internet venture could have. "How can you rate a successful e-business The outward signs of a robust and thriving business are: Revenue increases Ability to generate profits Success in creating meaningful alliances Success in expanding into new markets Differentiating itself from other business models " ( Online Internet Business Models). In such a scenario, there is an opportunity of launching an Internet shop selling home gym equipments, as its full-time Internet business. Business activity Launched in the early days of year 2008, 'Beauty Fitness', a full-time e-shop - is into the business of selling home gyms and fitness equipments to young people, and all the others who want to stay in a good shape, keep fit - both physically and mentally. With fast growing Internet accessibility, e-shops are gaining bigger and bigger potential. Having established their presence on computers of almost all the British households, e-shops are not limited with daily working hours, weekend offs, or festive holidays. Customers can have access to our Internet shop 24 hours a day, 7 days a week. More, while in classic shops customers are required to walk around the town, 'Beauty Fitness' offers the customers that ease, comfort, and convenience that anybody in this busy and bustling life would appreciate. People can view our offers from the comfort of their own home, with its minor detail explained right there. Equipments that we shall offer to our customers will be of various models, in a wide price and quality range. We shall offer from less known, low cost producers, to high quality, established brands. People can window-shop, compare the products, take their good time to ensure that the deal is indeed worth, and then can place the order whenever they want and from wherever they want. Aim Aim of the shop is to raise sales of the first year of business to cover the expenses of owner, one employee, to achieve minimum a break-even point for money invested for building Internet website and expenses like rental of server space and advertising on local Internet news portals and sports web pages. Good thing about Internet business is that in its start-up, it does not require high investments. Since all sales are conducted online, we do not need to have exhibit salons, neither we have to spend money on rental of good positioned store space. It is sufficient to have warehouse from where we can ship ordered goods. Orders are delivered to customers' homes, which can be done in two ways like : for local deliveries within a hundred miles from our warehouse, we could use our own truck; while to customers from further parts of the country, merchandised goods can be shipped via mail. Objectives Sales of 100,000 in the first year Gross profit margin of 40 % Net profit margin of 16 % Market size and growth Market is not limited by its size, since 'Beauty Fitness' is positioned on Internet and hence can be reached by thousands of customers from any part of the United Kingdom, anytime. We are aiming for customers from the neighborhood to those belonging to far-reached places of the country. We are open, and able, to deliver gym equipments across the country. Only limit that we have to bear in mind is that delivery expenses of our goods, as the price of an article with delivery expenses included must not be higher than the price of the same product in local store. The purchase of gym equipments has increased tremendously since the Year 1990. Home fitness equipments is a 300 million market today, and privately owned fitness facilities are more popular then ever. Competitors There are many local sports equipment stores that 'Beauty Fitness' will have to compete with, but they are to be considered as reapers for price corrections. Whilst local physical shops can not just be discarded in its entirety, I believe the competition is more with the e-shops of similar kind. We will have to bear in mind what kind of goods are offered in similar Internet shops like Fitzz ( www.fitzz.com ), which are already offering wide range of equipment and services to their customers, for years now. It is essential to position our shop on major search engines like Google or Yahoo. Business Strengths Strength of new Internet shop would be in good design of its web page, its accessibility on major search engines and links on web-pages of local Internet news portals and sports Internet pages. Advertising on Internet is much cheaper than on TV, radio stations or in printed news-papers. There is a possibility of forming our own sports web portal which would cover sports events across the country, that could raise interest for sports fans. Expenses for this web portal could be much smaller than in newspapers, but it allows possibilities for creating the online newspaper that can attract several thousand visitors daily. Proposed Customers General public : Typical market segments Twenties ( mainly male ) Impulse shoppers Dedicated buyers Sports clubs and schools ( offered discounts on our web site ) Marketing Stimuli ( 4 P's ) ( I ) Product 'Beauty Fitness' is an online retailer of quality home gym equipments and fitness products. However, the shop is not limited as a franchise of any particular brand of gym equipments. We believe that each of us are different and so are our tastes and preferences. We offer a scope of choice, as we sell the equipments of all the quality brands there like ProForm, Danskin, Harbinger, SPRI, Carl Lewis, Tunturi, Johnson, Horizon, Fitness-Mad, Echo - and more. ( II ) Price We will offer good quality branded merchandise at recommended retail prices. We will attempt to stock alternative merchandise and brands to Seasons Sports. We will offer good value for money but not lowest price, bearing in mind that our prices including shipping expenses are not higher than our competitors as local stores. ( III ) Promotion 1. Very limited advertising in local paper 2. Extensive promotion to visitors of sports web pages 3. Online ads on popular sports websites with link to Sports Retail Another excellent offering is related fitness products and services to our clients. There are literally thousands of companies that offer affiliate programs for things such as nutritional supplements, fitness software, workout accessories, fitness apparels, health and fitness books and magazines and a host of other products related to what we plan to offer. Having our own fitness website allows us to offer our clients the fitness related products and services they want without needing to invest our money in inventory. This lets us to establish a "toll position" as the resource for any fitness related product or service our clients ever consider buying, increasing our immediate income and the lifetime value of each and every client we will be having. ( IV ) Place ( Premises ) Since that we will not have store in a conventional way, we have smaller expenses. We don't have to rent exhibition place in the best locations, but all business can be conducted from a warehouse from which goods can be shipped to our customers. A normal warehouse, that can accommodate our equipments without damaging quality, is rented in a cheaper part of a town. Investments in Equipments The business must invest in as storage and packaging equipments, server rentals, and computer systems. All computers and communications equipments is purchased from local OC traders, and a dedicated fast business broadband line service is obtained from BT. Key people and Job functions Proprietors. Full-time web designer. And there may be other part-time dispatch staff, as required. Conclusion We realize that there are always concerns when making a costly purchase over the Internet. Through detailed product information, customer testimonials, third party endorsements and online fitness consultants, we can assure you that you are dealing with the most reliable source for online fitness equipments. 'Beauty Fitness' is not a retail company that 'also' sells fitness equipments online as a side business. The Internet is our primary sales medium. Consequently, the Beauty Fitness business model is geared towards the sale, service and fulfillment of cyber customers. Customers are assured of satisfaction through a solid money-back guarantee. All treadmills are backed with 1-year in-house repair warranty. Should a treadmill need service, there would be an extensive nationwide network of certified technicians. In addition, customers can call or email inquiries regarding service issues. Over the last couple of years the purge of the Internet has resulted in the survival of the fittest. Those companies that were able to translate successful business practices to a virtual environment have reaped the rewards. 'Beauty Fitness' will not only offer the convenience of shopping online, but also supports it with a business model designed for cyber shoppers. You get quality equipment, the best price, and outstanding customer service from the company that started it all. References Anajana, C., S., Online Internet Business Models, stylusinc.com, viewed March 04, 2008 Available at http://www.stylusinc.com/website/business_models.htm Chaston, I., 2004, Small Business E-Commerce Management, Chapter 1, Opportunities in an E-commerce World, Palgrave Macmillan, pp 1-20. Chaston, I., 2004, Small Business E-Commerce Management, Chapter 8, E-Product and E-promotion Management, Palgrave Macmillan, pp 148-174. Chaffey, D., 2006, Internet Marketing : Strategy, Implementation and Practice, How do Internet Marketing Communications differ, Prentice Hall, pp 20-24. Read More