Business Plan for a Soccer Academy - Assignment Example

Business Plan for a Soccer Academy Executive Summary Introduction The Continental Soccer Academy is a start-up business with a lot of potential. It seeks to engage in the professional training of young people to become among the best soccer players in the continent. Mission Statement To be competitive in producing the best Academy in the continent by producing the best soccer players in the continent, for the best soccer clubs in the world. Vision Statement To produce the best talent in soccer, with the aim of incorporating top talent and skills into the best soccer clubs in the world. Goals, Objectives and Strategies The goal of having this soccer academy is to benefit from the widening market for talented soccer players by satisfying the demand for skilled players by clubs all over the world. The main objective of this business venture is to be able to operate a profitable business venture that establishes contacts with the major clubs in the world in the development of soccer as a sport. This is to be achieved by the supply of well-trained soccer players for trials in these top clubs and eventual sign-ups by these clubs. This is aside from the objective of giving young talent an opportunity of realizing their dreams of playing for top clubs within and outside the country. The strategy that will be employed will be the admission of students on both part time and full time basis for training by specialized coaches, who will be responsible for the transformation of training students into professional soccer players eligible to play in clubs all over the world. The establishment shall work hand in hand with scouts from professional soccer clubs to identify the talent they require from among the students for absorption into the clubs they represent. Product Description The Academy shall take up the production of professionally trained and skilled soccer players. In this quest, the establishment shall require the services of fulltime coaches in all positions of play. Technical Advantage There are several advantages that this business venture has. To begin with, there are grave unemployment rates in the United States of America. Currently, the United States loses over $25 billion annually in uncollected taxes due to the young population being without any form of employment. With formal employment being the most rooted for form of employment, the number of people who can find white collar jobs because of their qualifications has increasingly become smaller, with white collar jobs being very rare to find. As at the month of August 2013, unemployment among the youth had risen by 692000. In the previous year, the number of unemployed youth had risen by 836000. This shows a trend where the number of unemployed youth keeps rising every year. This project seeks to reduce these figures by providing an avenue for young people all over the country to involve themselves in training in soccer in order to be competitive enough to get employment in clubs all around the country and the world so as to earn a living from the sport. Soccer has become a multi-billion dollar industry in the United States. The Major League Soccer consists of top clubs in the country. With viewership expected to increase rapidly this year, there is a growing demand from the viewers for top talent that will surpass the talent and skills displayed by top European clubs. This gives a window of opportunity for clubs to put in efforts towards acquiring the top talent from academies in order to satisfy this demand. In addition, with the increase in competition for major titles, clubs have the need for players with skill who will help them compete with other clubs. It is this need that the Soccer Academy seeks to help address, while being part of the revolution of soccer in the United States and the world. With this in view, the importance of setting up a Soccer Academy has national and international importance to people in the world of soccer at both club and national team levels. Customer Definition and Benefit The main customers for the Soccer Academy shall be professional soccer clubs both within the country and from other countries. These clubs will benefit greatly from the expertise and skills that the trained youth shall possess. With the kind of training that shall be given to these young people, the clubs stand to benefit from their contribution to the team and aid in the competition for all trophies, local and international. Market The market for soccer talent is big, considering the growth of club soccer all over the world. The world’s biggest leagues such as the Barclays Premier League in England, the Italian Serie A, the German BundesLiga, the Spanish La Liga are examples of leagues that have grown in revenues and signings over the past decade. Each league has clubs with professional players who earn from the sport. The earnings from the clubs have continued to increase since the turn of the millennium, with some players earning salaries as high as £300,000 a week. This shows the potential that this venture has towards helping the youth earn a living from their skills in soccer. The purchase of players is done after many considerations have been done. Top clubs purchase players for fees up to £100 million. When players get signed, they get a chance at getting endorsements from corporates. This increases their earnings. Viewers in America have the tendency to watch the top level of any sport they watch. In order to offer the viewers the best showpieces in soccer, clubs in the Major League Soccer and in lower leagues will need constant refurbishment of their squads to add the depth needed to challenge for major trophies both domestically and internationally. This gives the clubs more business arising from the endorsements and ticket sales to spectators who visit the stadiums to watch soccer games. The number of spectators who visit stadiums to watch games has significantly grown in the United States to a record of 44000 fans. This record falls way below attendance numbers in Europe, in particular countries like England, Italy, Spain, Germany and the Netherlands, where attendance is almost double the record figure in the United States. With guaranteed quality in the sport, the United States’ Major League Soccer and the lower leagues stand to draw more spectators into the stadiums, which directly translates to higher revenues for the clubs and the players. In that sense, the importance of Academies in supplying top skill and talent to these clubs cannot be underestimated. Financial Plan and Considerations The management intends to raise a gross amount of $ 5 million for the purchase of assets such as facilities, premises and land to start operations at the Academy. The income statement reads in dollars and is projected to read as such: Continental Soccer Academy Projected Income Statement Period Ending Apr 2015 Apr 2016 Apr 2017 Total Revenue 500000 1500000 3500000 Cost of revenue 250000 600000 1200000 Gross Profit 250000 900000 2300000 Operating Expenses 60000 150000 450000 Selling Expenses 10000 25000 50000 Other Expenses 10000 20000 30000 Salaries 60000 80000 100000 Operating Profits 110000 575000 1670000 Investor Benefit Investors in the project shall enjoy numerous benefits. First, there will be revenue that will be raised by the Soccer Academy from the sale of soccer players to various clubs. The amount of money raised from such sale shall be divided between the Soccer Academy and the investors. The division of such amounts shall be on the basis of dividends, where an investor shall receive payments according to their contribution to the course of establishment of the Soccer Academy and in the development of the players’ skills through sponsorships. In addition to that, investors will have the opportunity to contribute to the training of young individuals. By investing in the Soccer Academy, the investors will be participating in some form of social responsibility by giving young people hope of earning a living from playing soccer. With this accomplished, the investors will have contributed to the reduction in the number of unemployed youth in the United States, by extension helping in addressing the social ills that plague the society due to the youth being without jobs. Industry Analysis Soccer stands as one of the sports with a global appeal that is overwhelming. Soccer has grown beyond the confines of boundaries to gain support from people all over the world. Soccer has been able to unite people from different parts of the world in an activity that is both thrilling and exciting to watch. The growth of soccer has enabled the sport to transcend boundaries of many natures including religious, cultural, gender and even socio-economic boundaries. The appeal that soccer has continues to expand with a constantly increasing fan base and audience all over the world, in both developing and industrialized states. Estimates show that there are more than 240 million players who have been registered with the body that governs soccer in the world, the Federation Internationale de Football Association, commonly referred to as FIFA. Currently, FIFA has 205 associations as members and more than 300,000 clubs worldwide. The salaries paid to the players vary dramatically. While some earn very high amounts of money, other players earn very little. In Europe, where the players’ salaries are the highest in the world, the salaries of players come from the revenues raised by the clubs. Salaries take up more than half of most European clubs, sometimes rising up to 60 per cent. In the Major League Soccer, the league from which this business venture seeks to benefit, the players’ salaries are mostly drawn from the part of the budget set aside to pay salaries. In the MLS, players are given contracts by the League and not the individual clubs. Each club in the MLS is provided with a salary budget every year with the expectation that this money shall be managed in accordance with the team budget. FIFA also contributes to the salaries of players. It is such statistics that have motivated the entry into this sector. The number of soccer academies in the United States does not satisfy the demand for good players in the soccer industry. There still exists a large void that this initiative shall seek to fill so that the Major League Soccer and other leagues in the world can benefit from the vast soccer talent that is available in the United States. The number of players joining professional soccer clubs is increasing every year. The acquisition of top talent from the academies remains a major source of players for the clubs, with clubs both in America and abroad buying more than 500 players from the US market every year. In this regard, the soccer industry is robust with untapped opportunities that this project seeks to exploit. The Company Description The Continental Soccer Academy is a start-up company established with the aim of nurturing talent within the United States. This company shall be a profitable organization and will work in coordination with soccer agents, scouts from clubs and other stakeholders in order to benefit the trainees as they seek to establish professional careers in soccer. The company shall be owned by investors who will come in to contribute to the capital used to start up and run the company. SWOT Analysis Strengths The strength of this project is that it shall serve as a source of talent for Major League Soccer clubs and clubs from other leagues. In addition to that, this investment has a lot of potential for breaking even in a short time, considering the role that this investment is expected to play in the soccer industry. Investment in this venture is also an investment in the future of many young people, who will be given the opportunity exploit their skills and talent in order to improve their lives through employment by clubs all over the world. Weaknesses The main weakness of this project is that it needs a lot of money invested in order to facilitate the operations at the Academy. Opportunities The opportunities presented by this venture are immense. The investors have the opportunity to put their money in a worthwhile venture that promises high returns both in the short term and in the long term. The business stands to gain a lot from the wide market for skilled players by engaging in business with clubs and other professional academies all over the world. Threats The main threat faced by the establishment of this Academy is the acquisition of assets that will be essential for the facilitation of the activities of the Academy such as land for training. Objectives: Long Term and Short Term The short term objectives include scouting for young people who exhibit talent and the will towards working hard to develop their skills so as to become competitive in the world of soccer and attract proposals from clubs, scouting for the most competent trainers in all departments to train the young people and to establish links with as many clubs as possible to enable the candidates to get admission into soccer clubs to play professional football at a young age. The long term objectives include being the biggest supplier of talented and skilled players to the top clubs in the world, not just the Major League Soccer, establishing a soccer club to absorb some of the best students and compete with other clubs for titles, build a stadium for the club and the Academy in addition to growing into an internationally recognized Soccer Academy, admitting talent from all other countries into the academy. The Management The company shall have a Board of Directors drawn from the pool of investors and other stakeholders such as the bodies governing soccer in the United States. The members of the local community will also be represented in the board of the Academy so that interests of the community around the Academy can be addressed. The Academy Board shall appoint an acclaimed and accomplished registered Head Coach to help with the training of the youth who have been admitted to the Academy. The Head Coach shall be assisted by other coaches who will be involved in more specialized training, going into the departments such as Goalkeeping, Defending, Striking and playing in the mid-field. These departments will be headed by their respective coaches. The Service A working programme shall be designed to guide the activities at the Academy, so that there is a routine to be followed. This will serve to instil discipline into the players, with the aim of ensuring they attend practice and work hard to build on their skills. Once the players have gained the necessary skills and expertise, they shall be exposed to professional game play so that scouts can observe them and negotiate with the Academy on the acquisition of players from the Academy. The Academy shall also involve other institutions in exchange training programmes in order to give the trainees further exposure before they begin their professional careers in soccer. Production Training shall be done within the grounds of the Academy under strict guidance of the Head Coach and his technical team. The methods shall be of the highest standards in order to produce players with discipline and the required expertise to be able to perform well in the clubs that they shall be contracted to. Market Analysis The market for players from academies is limitless. With professional soccer clubs coming up everywhere in the world and competitions for major titles becoming tighter by the day, very many clubs continue to seek the services of highly trained soccer players. In the United States alone, there are over 500 players that are signed every year by professional soccer clubs. The market for professional soccer players goes beyond the boundaries of the United States, with American players joining other major leagues in the world, making entry into this market an attractive venture. Competition The Academy shall face competition from other established soccer schools in the United States for both coaches and trainees alike. However, the Academy shall gain competitive advantage by acquiring the best trainers to equip the trainees with the best skills in the market Selling The sale of players shall be done as per the guidelines of FIFA and shall be undertaken after deliberations have been done between the Board, the player and the purchasing club. The Academy shall have a sales team that shall undertake the search for market for players, inviting scouts and other soccer managers to the academy’s training sessions and friendly matches with the aim of initiating the process of making sales to these soccer clubs. Reference "Business Plans." - U.S. Soccer. N.p., n.d. Web. 22 Apr. 2014. . Read More