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1.0 Executive Summary
The purpose of this business plan is to showcase the continued development and expansion of a yoga studio based Seattle, Washington. Yoga Studio, LLC (“the Company”) was founded by Gabriel Smith. The business will provide a broad range of yoga instruction that will facilitate good health, increased flexibility, and wellness among its client base. The Company is in the process of working with a commercial real estate broker to find a suitable storefront location in the Seattle market area. At this time, the Founder is seeking $60,000 to launch operations.
1.1 The Services
The primary revenue center for the business will come from the numerous daily yoga sessions that will be open to the general public. The Company intends to charge $15 per session. The Company, in order to reduce costs, will work with qualified yoga instructors that will be retained on an independently contracted basis.
In order to create highly recurring revenue, the Company will implement a membership-based program that will charge clients on a monthly basis for unlimited access to the facilities. This will not only provide stable profits for the business, but it will also increase the valuation of the Company as a whole. The Company will recognize more modest revenue streams through the sale of bottled water/teas, apparel, yoga mats, and related products.
Chapter three will further discuss the operations of the business.
1.2 Financing
At this time, Gabriel Smith is seeking $60,000 to develop the operations of the Yoga Studio. The funds will be primarily used for the following:
• Development of a storefront space in Seattle
• Furniture, fixtures, and equipment
• Working capital
• Initial marketing operations
The recurring income from membership operations and highly predictable income from hosting daily sessions makes the Company a strong candidate for expansion capital if needed. This document assumes that any growth will be financed with the retained earnings of the business.
1.3 Mission Statement
Management’s mission is to provide comprehensive yoga and wellness focused services to the Seattle area public at an affordable cost.
1.4 Management Team
Gabriel Smith has seven years of experience as a yoga instructor. The Owner will be able to establish a significant membership base in this market while ensuring the economic stability of the business.
1.5 Sales Forecasts
1.6 Expansion Plan
Over the next three years, the Company will make continued investments into marketing operations in order to establish a significant membership base within Seattle. The Company may also develop additional yoga studio locations within this market given the population density and wealth of Seattle. This would not occur until after the third year of profitable operation.
2.0 Company and Financing Summary
2.1 Registered Name and Corporate Structure
Yoga Studio, LLC.
2.2 Required Funds
Yoga Studio, LLC requires $60,000 of debt capital to establish its operations while ensuring the business has enough capital on hand to reach profitability.
2.3 Investor Equity
The Company is seeking a SBA loan rather than a private investment at this time.
2.4 Management Equity
Gabriel Smith is currently the sole owner of Yoga Studio, LLC. This is subject to change depending on whether or not the Company will acquire growth capital in the future.
2.5 Exit Strategy
Usually, established yoga studios are sold to yoga instructors that practice at the facility. In the even that Management wishes to retire or divest the business, Gabriel Smith will work with one of the Company’s associates to acquire the business. This event would not occur for at least five to seven years.
3.0 Yoga Operations
As stated in the executive summary, Yoga Studio, LLC will provide a broad range of yoga instruction across a number of established disciplines. The Company will operate its location from 8AM to 8PM. This will allow a broad range of people with Seattle to use the facilities depending on their respective schedules. The Company will retain highly experienced yoga instructors that will render service at the location. They will receive fees equal to 40% of the revenue generated from that session.
Of utmost important to the Yoga Studio will be the establishment of its membership operations. This will allow the Company to produce recurring income by charging members credit/debit cards on a monthly basis. These members will be provided with unlimited usage of the facility. Management anticipates that members will participate in one yoga session every two days.
Beyond these revenue centers, the Company will maintain a moderate area of the facility that sells yoga mats, beverages, wellness books, incense, and apparel. The Company will generate gross margins of 65% from these sales.
4.0 Strategic and Market Analysis
4.1 Economic Outlook
This section of the yoga studio business plan will focus on the current economic climate, the studio’s anticipated customers, the competition that the business will face in Seattle, the industry as a whole.
At this time, the US economy is doing reasonably well. Interest rates are starting to decline given the implementation of responsible financial policies by the US Federal Reserve. Inflation rates have returned to around 3%, which is expected to remain over the next twelve to twenty-four months.
The Yoga Studio’s revenues are not sensitive to negative changes in the economy. Given the wealth of the Seattle market and the low costs associated with using the Company’s services – any economic recession will not impact the business’ ability to maintain profitability.
4.2 Industry Analysis
Currently, there are 40,000 companies that operate yoga studios throughout the United States. Each year, these entities collectively generate in excess of $5 billion per year. The industry has experienced solid growth over the past ten years.
The growth of this industry will be similar to that of the economy as a whole plus the ongoing rate of inflation. One of the ways that these entities have continued to expand is by providing virtual classes for members. In time, the Company will implement state-of-the-art video technology that will allow enrolled members to participate in classes from their mobile devices.
4.3 Customer Profile
The following profile will be used when marketing the Yoga Studio to the Seattle area public:
• Female (65%) – Male (35%)
• Between the ages of 25 and 65+
• Will frequent the Yoga Studio two to three times per week
Here, a full examination of the population of your target market needs to be completed. This includes discussing the number of people, the number of people that frequently attend yoga classes, age demographics, income demographics, and the wealth of the target market.
4.4 Competition
Given the immense popularity of yoga, there are now numerous studios in every market. One of the keys to staying competitive in this industry is to ensure that your yoga studio is open for at least ten hours per day. People have varying schedules, so it is important for members to have continued access to these types of facilities. One of the ways that these entities retain a competitive advantage is by offering numerous types of yoga including hot yoga sessions.
Within the competitive analysis, it is important that you list major yoga studios within your respective market. This should include an estimation of the number of clients that each client has and their anticipated revenues. This will give you a strong gauge as to the economic viability of your business.
5.0 Marketing Plan
As discussed earlier, yoga studio owners face ongoing competition given the low costs of developing these types of businesses. Most importantly, Management is seeking a high visibility location that will feature significant exterior signage.
5.1 Marketing Objectives
• Develop ongoing relationships with corporate wellness specialists in Seattle that will provide referrals.
• Develop a proprietary website that will be quickly found when relevant searches for yoga studios in the target market are conducted.
• Provide members with incentive benefits for providing referrals.
5.2 Marketing Strategies
First, the Company is seeking a highly visible location that will most likely occupy a storefront space. It will feature extensive exterior signage. Management anticipates that the business will secure a 750 square foot studio to house the operations. The business expects to spend $2,000 for a high visibility location.
The Company will develop ongoing referral relationships with numerous professionals throughout Seattle. These referrals will come from real estate brokers, agents, medical professionals, and mental health professionals. Of these relationships, referrals from real estate brokers/agents will be the most important aspect of these operations. The Company will also implement a rewards program among clients/members that frequently provide new business to the Yoga Studio.
Yoga Studio, LLC will also maintain an expansive presence among all major social media networks with a focus on Facebook and Instagram. The business will also maintain a presence on LinkedIn so that the Company can establish referral relationships with corporate wellness specialists. As there are numerous major corporations in this market, the Company sees a significant opportunity to market the Yoga Studio through this channel.
The Company will also maintain an expansive proprietary website that will allow users/members to book services directly through the platform. This website will be search engine optimized specific for the Seatle market. The Company, on this platform, will frequently provide discounts and promotions to further drive traffic to the location.
5.3 Pricing
Group sessions will be $15. Private sessions will cost $75. Monthly membership fees will be $100.
6.0 Organizational Plan and Personnel Summary
6.1 Corporate Organization
6.2 Payroll
6.3 Management Biographies
As stated in the executive summary, Gabriel Smith has seven years of experience as a professional yoga instructor. When developing this section of the business plan, you should focus on your experience in the field of providing ongoing yoga instruction as well as your relevant experience as an entrepreneur.
7.0 Financial Plan
7.1 Underlying Assumptions
• Yoga Studio, LLC will acquire a $60,000 SBA loan.
• Gabriel Smith will contribute $10,000 towards the venture.
7.2 Sensitivity Analysis
As has been the theme throughout this document, the Yoga Studio’s revenues are not subject to negative changes in the economy. Seattle is a wealthy market area that is home to major corporations and technology enterprises. The business will have highly controllable operating costs, which will allow the Company to remain profitable at all times.
7.3 Source of Funds
7.4 Profit and Loss Statement
7.5 Cash Flow Analysis
7.6 Balance Sheet
7.7 Breakeven Analysis
7.8 Business Ratios
