Fall/Winter
The Final Buzzer
Business Plan
“Where sports live”
Comm 447
Jordan Vandriel
“Where sports live…”
Connor Gulka
‘14
Table of Contents
Executive Summary ............................................................................................................... 1
1.0 Business Overview ........................................................................................................... 2
1.1
1.2
1.3
Introduction..........................................................................................................................2
Mission Statement ................................................................................................................2
Goals and Objectives .............................................................................................................2
2.0 Operations Plan ............................................................................................................... 3
2.1 Location and Site Plan ...............................................................................................................3
2.2 Floor Plan .................................................................................................................................4
2.3 Quality Control .........................................................................................................................5
2.4 Average Business Day ...............................................................................................................5
2.5 Supply Analysis .........................................................................................................................5
2.6 Menu and Permits ....................................................................................................................6
2.7 Capital Budget ..........................................................................................................................6
2.8 Cost of Goods Sold ....................................................................................................................6
2.9 Operating Expenses ..................................................................................................................7
2.10 Working Capital Plan...............................................................................................................7
3.0 Human Resource Plan ...................................................................................................... 8
3.1 Organizational Structure ...........................................................................................................8
3.2 Job Descriptions .......................................................................................................................8
3.3 Full Time Equivalents and Customer Service ............................................................................ 10
3.4 Tips and Human Resource Policies........................................................................................... 10
3.5 Human Resources Costs .......................................................................................................... 11
4.0 The Marketing Plan ........................................................................................................ 12
4.1 Needs of the Customer ........................................................................................................... 12
4.2 The Marketing Mix ................................................................................................................. 13
4.4 Target Market......................................................................................................................... 15
4.5 Competitive Analysis .............................................................................................................. 15
4.6 Revenue Projections ............................................................................................................... 16
4.7 The Marketing Budget ............................................................................................................ 17
5.0 The Financial Plan .......................................................................................................... 18
5.1 Financing ................................................................................................................................ 18
5.2 Dividends and Pay Back on Equity ........................................................................................... 18
5.3 Break-even, Cash Flows and Sensitivity ................................................................................... 19
5.4 Investment Analysis ................................................................................................................ 19
6.0 Summary ....................................................................................................................... 20
Appendix A.......................................................................................................................... 21
Site Map ...................................................................................................................................... 21
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“Where sports live…”
Appendix B .......................................................................................................................... 22
Menu ........................................................................................................................................... 22
Appendix C .......................................................................................................................... 23
Financial Plan and Model .............................................................................................................. 23
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“Where sports live…”
Executive Summary
The City of Saskatoon provides tremendous opportunity for The Final Buzzer. Being a booming city with
many affluent neighbourhoods, the opportunity comes from active families and individuals who have
disposable income to spend on dining at restaurants and lounges, The Final Buzzer being one of them.
Saskatoon has a multitude of sports leagues to play and participate in, but has a shortage of venues that
are explicitly designed where you can go out in public and watch professional sporting events and dine at
the same time. The Final Buzzer will fill this shortage in the market.
The Final Buzzer Sports Bar and Lounge is the ultimate venue that offers quality food and drink, while
providing an environment and enjoyable atmosphere that makes you feel like you are watching your
favourite sports team live. Having 24 TV’s inside our lounge, as well as an open concept and a circular
bar complete with a functional red flashing buzzer above the bar, provides uniqueness as well as a
competitive advantage that other restaurants and lounges do not offer. The Final Buzzer plan’s to be
Saskatoon’s #1 sports bar to be at while the game is on.
How will we become Saskatoon’s #1 sports bar?
The Final Buzzer will deliver to our customers on three fundamental aspects that will meet customer
needs and ensure a positive experience every time:
1
2
3
Being experienced, having well trained staff who are knowledgeable
Be professional
Be efficient in our service
The Final Buzzer identifies our critical operating variable as getting enough customers in our door, and
we plan on acquiring customers through an extensive promotional and marketing campaign.
It will be necessary to market our name and be active in getting customers interests. By promoting
through channel such as sponsorships, putting our name in the media, word of mouth, print media
advertising and attractive curb appeal and storefront image. These channels will be effective means on
making sure we are visible to our target market; who are sports fans of all types, families and individuals
who like to watch sports and athletes who play the sports and enjoy watching.
By delivering on the three fundamental aspects listed above and following our extensive marketing plan,
The Final Buzzer provides sufficient evidence that it will be economically feasible and profitable. As long
as we surpass our break even critical variable of 871 customers per day, The Final Buzzer will see profits
and positive cash flows and be able to pay dividends soon into the life of the business and provide
investors with a return of 46.4%.
The Final Buzzer will be “where sports live” and provide Saskatoon and residents with the ultimate
location to enjoy the games they enjoy watching. Whether it’s a meal for lunch, grabbing a drink after
work, or coming out to watch the big game on the weekend, The Final Buzzer will be a fun and
welcoming environment for all types of sports fans. When the game is on, we’ll see you at The Final
Buzzer.
“Where sports live…”
1.0 Business Overview
1.1
Introduction
The Final Buzzer Sports Bar and Lounge is Saskatoon’s most enjoyable destination to watch
your favourite sports team play, no matter what the sport or what the team, The Final Buzzer will
have the game on. Located in the Stonebridge commercial community, The Final Buzzer will be
the place to go when your favourite sports team is playing. Providing quality food and drink will
complement the atmosphere that makes you feel like you are watching the game live.
1.2
Mission Statement
The Final Buzzer is passionate and determined to be Saskatoon’s best sports bar and lounge. The
Final Buzzer will provide sports fans with the ultimate environment and culture to enjoy all the
games you love. The Final Buzzer has determined the following mission statement:
“The Final Buzzer provides a memorable environment where all sports fans come together to
enjoy the game they love. “
1.3
Goals and Objectives
o
Raise equity funding and obtain loan from the bank to cover initial capital costs
o
Open in 2015, with high demand and maximization of revenues for Year 1
o
Allocate financial resources to execute a strategic and effective marketing campaign to
build excitement for doors opening in 2015 to ensure customers come through our door
o Build a reputation in the community as Saskatoon’s #1 sports bar
o Get involved in the community by sponsoring sports teams that participate in recreational
leagues
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“Where sports live…”
2.0 Operations Plan
2.1 Location and Site Plan
The Final Buzzer will be located in Saskatoon, Saskatchewan. Saskatoon was chosen as our
target city due to the booming population with high average household incomes. The location of
Stonebridge was chosen for the Final Buzzer because it is easily accessible, surrounds many
suburban areas that have disposable income, and is close to many different sporting facilities.
The table listed shows the 2013 suburban figures, and were taken from the City of Saskatoon
website.
Area
Briarwood
Lakeridge
Lakeview
Rosewood
Stonebridge
The Willows
Population
4987
3981
7603
707
6774
648
Average Household Income
$148,762
$138,781
$114,185
$118,229
$112,942
$218,770
The Final Buzzer will be located in the heart of Stonebridge’s commercial community on
Wellman Lane as seen in the picture below. The main reason this location was chosen was the
numerous opportunities this up and coming area had to offer. Many affluent areas surround
Stonebridge and is in close proximity to several sport venues such as, the Jemini Rink, the
Willows Golf Course, Saskatoon Golf and Country Club, the Schroh Arena, Nutana Curling
Club as well as many ball diamonds. The location in Stonebridge is easily accessible from any
direction as Circle Drive runs both east and west, and Clarence Avenue runs north to south.
Another main factor in choosing this location was due to the small amount of bars or pubs in the
Stonebridge area, and lack of immediate competition. In this location there is a large need that is
not being met and therefore The Final Buzzer will aid in meeting the demands.
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2.2 Floor Plan
The floor plan above represents the visual layout of The Final Buzzer Sports Bar and Lounge.
With an effort to be seen as the most attractive sports bar in Saskatoon, this open concept bar and
lounge attempts to provide a quality experience for any and every sports fan. A highlight of our
layout is providing 24 televisions, which allows for variety of sporting events. The floor plan
includes a state of the art kitchen, a large storage room, an office for managerial activities and a
VLT room. The open concept of the bar reduces visibility issues that come from extra walls or
beams, and on the left hand side of the plan showcases booths to provide diverse seating options.
The open concept also mocks the concept of arenas, stadiums and courts, which are all open and
spacious in order to watch the game live. As located in the diagram, there are 2 emergency exits,
one main entrance, and doors located in the back specifically for inventory shipments.
Maximum capacity for The Final Buzzer is 125 seats in the lounge/restaurant + 9 seats in the
VLT room.
The overall site plan is 5200 square feet, where 4000 square feet is the building, leaving 1200
square feet for parking. The land will be purchased at $520,000 ($100 per square foot*4000
square feet+30% site coverage). The building itself will cost $1,200,000 that was quoted from
ICR Saskatoon. This location will have lots of street parking on top of the 1200 square feet of
parking we can add. A site map can be found in Appendix A.
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2.3 Quality Control
The Final Buzzer will abide by all regulations and standards required by the Saskatchewan
Liquor and Gaming Authority (SLGA) as well as Saskatchewan’s Food Health and Safety. To
ensure this business’ success, guaranteeing quality food and workplace cleanliness and safety is
crucial. The Final Buzzer will implement rigorous cleaning schedules and periodic supervisor
approval before food leaves the kitchen to ensure these standards are being met. A key factor to
maintaining these standards are receiving customer feedback and adjusting accordingly.
2.4 Average Business Day
Hours of Operation: 11:00am – 1:00am
10am: Managers and Kitchen Staff arrive to prepare The Final Buzzer for the day
11am: The Final Buzzer opens. Servers and Bartenders start shift (Shift 1)
4pm: Part time Kitchen Staff arrive to prepare for the dinner rush
6pm: Bar Supervisor and Assistant Manager arrive. Servers, bartenders and additional kitchen
staff arrive for shift (Shift 2)
7pm: Shift ends for Servers and Bartenders (Shift 1)
9pm: Part time kitchen staff shift ends
1am: The final buzzer sounds, closing time
2am: Shift ends for rest of staff (Shift 2)
2.5 Supply Analysis
The Final Buzzer will have three main suppliers, all of which will provide the essential materials
to create the intended experience. All food and raw materials will be purchased through Sysco
Foods. Sysco is a global leader in selling, marketing, and distributing foods. Another key factor
in choosing Sysco is their enticing online ordering system which will increase ordering
efficiency. Denson Commercial Food Equipment Inc. will
supply all of the furniture and equipment. This company is
Saskatchewan’s largest independent dealer; therefore, it was
appealing to support a local company. To fully furnish and
equip this bar and lounge, The Final Buzzer was quoted at
$110,000 which included everything from furniture to
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silverware. The SLGA will supply all liquor and alcohol as well as the VLT machines.
SaskPower, SaskTel and SaskEnergy will be the utility providers for The Final Buzzer.
2.6 Menu and Permits
The Final Buzzer will serve a quality menu to add to the overall experience and atmosphere of
our sports bar and lounge. We want our customers to come to our lounge to enjoy the atmosphere
but enjoy their favourite meals and drinks. The Final Buzzer will offer a full food menu that will
serve lunch and suppertime meals that will be available throughout the day. The Final Buzzer
will also sell beer and hard alcohol to our customers who are of legal drinking age. The Final
Buzzer has acquired the required licenses and endorsements needed to operate. We have
acquired a restaurant liquor license, with a lounge endorsement as well as minor endorsement,
which allows minors to be present in a restaurant that serves alcohol. The Final Buzzer will not
serve alcohol to anyone under the age of 19. A sample menu that The Final Buzzer will use can
be found in Appendix B.
2.7 Capital Budget
An outline for our initial capital costs is outline in the table below. The Final Buzzer plans on
renovating and refurbishing in the third year to keep our restaurant up to date and all of our
furniture current with trends and styles to keep The Final Buzzer attractive.
Capital Budget
2015
Land
Buildings
Furniture and Fixtures
Total
520,000
1,200,000
110,000
1,830,000
2016
2017
2018
2019
200,000
50,000
250,000
2.8 Cost of Goods Sold
Costs are based on the gross profit margins listed in column 1. All cost of good sold are based on
costs for one year.
Cost of goods Sold
Beer
Hard Liquor
Food
Total COGS
Gross Profit
Margin
74%
80%
60%
2015
2016
2017
2018
2019
106,105
81,619
217,651
405,375
119,633
92,026
245,402
457,061
128,755
99,043
264,114
491,912
138,573
106,595
284,252
529,420
149,139
114,722
305,927
569,788
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2.9 Operating Expenses
Expenses are projected based on estimates, based on historical and similar businesses.
Operating Expenses
Accounting and Legal
Radio Expense
Store Front Signage
Advertising
(Marketing)
General Supplies
Insurance
Property Taxes
Telephone
Utilities
Repair and
Maintenance
Wages
Employee Benefits
Misc Variable Costs
% Sales
Capital Cost
Allowance
Debt Interest
Total Operating
Expenses
2015
3,400
3,000
3,000
1,375
2016
3,485
3,075
2017
3,572
3,152
2018
3,661
3,231
2019
3,753
3,311
1,409
1,445
1,481
1,518
1,000
2,500
5,000
1,200
20,000
2,000
1,025
2,563
5,125
1,230
20,500
2,050
1,051
2,627
5,253
1,261
21,013
2,101
1,077
2,692
5,384
1,292
21,538
2,154
1,104
2,760
5,519
1,325
22,076
2,208
442,137
61,722
27,206
492,216
68,713
30,675
531,494
74,197
33,014
574,536
80,205
35,532
621,724
86,793
38,241
35,000
66,840
60,998
65,024
68,596
72,000
680,541
70,043
768,950
67,968
809,145
65,769
863,576
63,438
922,364
2.10 Working Capital Plan
Cash Conversion Cycle equals -7 days. Inventories are held no longer then 7 days and our
accounts payable are 14 days from suppliers are negotiated to 14 days payable with 0 days for
our collection period as all meals and tabs are paid before customers leave The Final Buzzer.
Working Capital
Inventory
Acc Pay
2015
7,882
16,589
2016
8,887
18,620
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2017
9,565
19,996
2018
10,294
21,476
2019
11,079
23,068
3.0 Human Resource Plan
3.1 Organizational Structure
The Final Buzzer is a joint structure business where Connor Gulka and Jordan Vandriel are
owners and shareholders with 50% ownership each. The board of directors include both owners,
both supervisors, and the business’ lawyer. Listed below is the organizational structure of the
business.
Managers
Asst.
Manager
Servers
Bar
Supervisor
Kitchen
Staff
Bartenders
Jordan and Connor are at the top of this hierarchy as owners and managers. Below the managers
are an assistant manager as well as a bar supervisor. These positions require extensive experience
in the food industry. The assistant manager will aid in any tasks deemed necessary by the
owners, and will supervise mainly the servers and kitchen staff. The bar supervisor will be in
charge of all activities associated with the bar, and all bartenders will report to this supervisor.
3.2 Job Descriptions
Managers
The managers, Jordan and Connor, are in charge of all day-to-day activities for The Final
Buzzer. Both managers have degrees from the Edwards School of Business and make all critical
decisions in the areas of operations, finances, marketing, human resources and accounting.



Develop marketing strategies
Recruitment, selection, payroll and instilling all HR practices
Managing inventories and financial measures
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

Ensuring customer satisfaction
Provide leadership and vision
Assistant Manager
The assistant manager works underneath both managers, and is in charge of the following duties:






Developing work schedule for servers and kitchen staff
Balancing cash, deposits and bank reconciliation
Aid in customer service
Responsible for all servers and kitchen staff and their respective duties
Inventory and quality control of food
Closing The Final Buzzer
The assistant manager is required to have 2 years of industry experience in a managerial role.
Bar Supervisor
The bar supervisor works underneath both managers, and is in charge of the following duties:





Developing work schedule for bartenders
Aid in customer service
Responsible for all bartenders and their respective duties
Inventory and quality control of beverages
Closing The Final Buzzer
The bar supervisor is required to have 2 years of bartending experience in a leadership role.
Kitchen Staff
The kitchen staff will be responsible for all the following kitchen duties:





Prepare, cook, and present food in a timely fashion meeting all standards
Keeping kitchen clean and tidy at all times
Work safely around kitchen and abide by all policies
Clean dishes
Restock and replenish supplies
Servers



Greet customers and seat them
Take orders, while providing excellent customer service
Processing payments and cleaning dining areas
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Bartender
The bartenders will be responsible for the following duties:






Prepare all alcoholic and non-alcoholic beverages
Mix ingredients and prepare cocktails
Restock and replenish supplies
Clean bar area
Settle tabs for customers
Provide excellent customer service
All bartenders and servers are required to provide excellent customer service. It is essential for
these individuals to portray extraordinary people skills, creating an atmosphere that welcomes
any and every customer.
3.3 Full Time Equivalents and Customer Service
Number of Employees:
Manager (full time)
Full time staff
Part time staff
2015
2
2
125,000 8.88
2016
2
2
10.27
2017
2
2
11.21
2018
2
2
12.21
2019
2
2
13.30
The Final Buzzer projects that each staff member will be able to handle $125,000 in sales alone
yearly. This leaves The Final Buzzer with a full time equivalent of staff equal to 9. This is
important because The Final Buzzer knows the importance of customer service, and we are
prepared to have enough part time and full time staff to meet the demand of our customers and to
ensure we are efficient and able to provide excellent service. Part time staff will be allocated to
busy periods of the day, to ensure service is efficient and timely and meets all customer needs.
3.4 Tips and Human Resource Policies
The Final Buzzer will use a combined tip strategy. All tips made by the servers and bartenders
will be divided in half. The first portion will be pooled and divided amongst servers and
bartenders; the second half will be pooled and divided up amongst the kitchen staff.
A reward system and performance pay will be implemented once cash flows show profitability.
During start-up phase, the general managers will be the only employees who are offered benefits.
Once The Final Buzzer establishes cash flows, full time employee benefits will be taken into
consideration. Canada Pension Plan, workers compensation, two weeks holiday pay, Employee
Insurance will all be implemented immediately.
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“Where sports live…”
3.5 Human Resources Costs
The Final Buzzer will offer high wages to part time staff to ensure the quality of our staff is high
and will provide efficient and excellent customer service to all of our customers, every time. This
higher wage will help keep turnover on part time staff down and increase job satisfaction.
Salaries/Wages
Manager Salary
(annual)
Full time staff
(per/hr)
Part time staff
(per/hr)
2015
60,000
2016
61,500
2017
63,038
2018
64,613
2019
66,229
$20.00
$20.50
$21.01
$21.54
$22.08
$14.00
$14.35
$14.71
$15.08
$15.45
Salary and Wage Costs
Manager
Full time staff
Part time staff
Total Salaries and
Wages
2015
120,000
78,400
243,737
442,137
2016
123,000
80,360
288,856
492,216
2017
126,075
82,369
323,050
531,494
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2018
129,227
84,428
360,881
574,536
2019
132,458
86,539
402,727
621,724
4.0 The Marketing Plan
“Where sports live”
The tagline listed above, summarizes the culture and the atmosphere of The Final Buzzer. With
this tagline The Final Buzzer wants to ensure it has met every single need our customers have
while visiting and dining at The Final Buzzer. How The Final Buzzer will deliver on meeting the
needs of our customers is being exceptional in the following:
1. Experienced Staff
2. Professionalism
3. Efficiency
4.1 Needs of the Customer
The Final Buzzer plans to meet market and customer demands and satisfy customer needs in
every way possible. Identifying needs such a cleanliness, quality of food, quality service and
providing excellent value, The Final Buzzer will fulfill the needs in the following ways:
1. Experience and Expertise
Providing quality experience and food is a requirement every customer wants to have delivered
every single time. The Final Buzzer will provide quality food and drink to our customers and
satisfy the customer, by having the required experience and expertise when it comes to food
preparation and handling and delivery. This will be accomplished by having trained and
experienced staff that is knowledgeable and capable of delivering top quality food and drinks and
ultimately experience.
2. Professionalism
In order to meet the need of providing quality service, The Final Buzzer will display nothing less
then extreme professionalism to our customers. Possessing the required training and
certifications, and having the utmost class and respect for customers as well as courtesy will
allow The Final Buzzer staff to deliver quality service to our customers.
3. Efficiency
Cleanliness is a top priority for our customers and The Final Buzzer promises to be efficient in
every way possible. Being efficient will help reduce extra work and save on creating mess,
which in return will help keep our restaurant clean and inviting to our customers and help with
delivering the overall experience.
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“Where sports live…”
By delivering on each of these areas for our customers every time, this will allow us to create
value for our customers and enhance the experience overall.
4.2 The Marketing Mix
Products
“Where sports live”
The Final Buzzer provides a memorable environment where all sports fans come together to
enjoy the game they love. Our vision is based on enjoyment, entertainment as well as a
welcoming atmosphere and that is what The Final Buzzer strongly believes in. Being a yearround sports bar and lounge that offers quality food and beverages provides grounds for fans to
come and enjoy at any time of the day, and have the same quality experience every time.
At The Final Buzzer we will strive to provide quality service and provide our customers with the
experience of being at the game themselves. Offering a variety of domestic and import beers as
well as all of your favourite snacks and meals you could get at the rink, ballpark, stadium, to
make it feel like you are actually there. We want our customers to come for the experience,
watch their favourite teams play, enjoy the food and the company and the environment
Pricing Strategy
The Final Buzzer will use a competitive pricing strategy to compete in the market and against its
competitors. Using a competitive strategy, The Final Buzzer will look to have a competitive
advantage and try to under-cut in price and have better prices then competition in the area, but
will have to pay close attention to our margins so we are able to maintain the margins that fit
within our financial model.
The Full Buzzer menu will feature standard prices for lunch and for dinner meals, with weekly
deals going on that will give The Final Buzzer a competitive advantage and this will tie in with
our advertising and promotional campaigns that will entice customers to come to our restaurant
for nightly/weekly specials going on. We want to offer discounts and deals to our customers to
increase customer especially within the first few months of opening our doors.
The restaurant market is extremely competitive but with our
location and only indirect competition in surrounding area, The
Final Buzzer will be completely competitive with price and be
reasonable to create value for our customers. We are looking to
maintain healthy profit margins within reason and can be further
detailed in the table to the right.
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“Where sports live…”
Gross Profit
Margin
Beer
74%
Hard Liquor
80%
Food
60%
Over the first 5 years, The Final Buzzer will have to evaluate the market and customer demands
to determine if our competitive pricing strategy is efficient, and have the capability to be flexible
on price or in market trends increase be able to move with that trend and adjust prices
accordingly.
Promotion
The Final Buzzer will have an active promotional campaign to entice customers to get into our
doors. Creating a brand is vital for the success of our business, and it is essential that we create
value for our customers so they consistently keep coming back. It is important that we sell our
experience and image to the customers, and have a welcoming appeal. The Final Buzzer plans
on executing these following promotional activities both internally and externally to help
promote the image of our business, for example:
Internal
Wing Deals
Sports team food/drink specials
Sport team memberships/ team fees
Daily discounts and deals on food and beverage
External
Attractive store front signage
Radio campaigns
Flyer distribution, newspaper ads
Word of mouth, community involvement
Referring to the insert on the left, within a 3 km radius,
we plan to target our target market by flyer distribution,
storefront advertising and providing exceptional quality
in-store to promote positive feedback and generate a
good reputation through word of mouth from our
customers who had an enjoyable time and experience.
Being active with these customers and building solid
relationships will be a big task but will be successful in
the long run as there is a high probability they will
return frequently if they had an enjoyable experience.
The Final Buzzer will also include the usage of an
attractive and bright storefront signage to bring customers into our door and let them know
where we are. Storefront appeal with colours to match our signage will provide the aesthetic
appeal to people who are passing by looking for somewhere to stop
and eat.
Our logo and signage is clear and explains exactly who and what we
are. It is important for us to have this clear and easy to follow image
so that it is clear of what we are and who we are; the place to go to
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“Where sports live…”
watch your favourite team and enjoy the atmosphere, friends and the food we provide.
The Final Buzzer also encompasses our name by including a red sports buzzer at the top of our
circular bar inside the doors. This buzzer will flash and sound at closing time or for special
events or games going on, such as Saskatchewan Roughriders touchdowns or Team Canada
goals. The uniqueness of this buzzer will be the signature touch to The Final Buzzer and be a
customer attraction.
Place
The Final Buzzer aims to be the location for sports fans of all levels of interest and sports can
come to enjoy and watch their favourite teams play. The Final Buzzer is located in an ideal spot
where it is close to many sporting facilities such as hockey rinks, golf courses, and ball diamonds
and located in a residential area, which is convenient for customers to avoid travel time.
Also located in residential area with higher average household income, this provides us with a
target market that is willing to go out and spend disposable income on meals and outings. The
Final Buzzer is located near a strip mall where there are other retail stores. Hotels are also a few
blocks away, and business districts with many offices are in close proximity to The Final Buzzer.
After work socializing and hotel customers who are looking to eat outside the hotel have The
Final Buzzer
4.4 Target Market





The Final Buzzer will target the active families and individuals who eat meals out in
restaurants.
The Final Buzzer will target sports fans of all sports who like to go out and watch the
game
The Final Buzzer will target potential customers of both genders from the ages of 19-65
The Final Buzzer will target consumers in a 3km radius in the first few months and
expand to the entire city within 1 year
The Final Buzzer will target athletes and participants of competitive and recreational
leagues throughout the city
4.5 Competitive Analysis
The Final Buzzer has 4 direct competitors in the city, Boston Pizza, Red Zone, Sports on Tap and
Shark Club. Boston Pizza has many locations in the city, which only one of their locations falls
within the 3km radius of The Final Buzzer. Red Zone, Sports on Tap and Shark Club all fall
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“Where sports live…”
outside The Final Buzzer and this gives us the advantage. With no direct competition within
range it makes The Final Buzzer a clear choice of where to go when the game is on.
The Final Buzzer intends to compete with pricing as well, where all of our direct competitors
offer similar prices. It will be the promotion deals and discounts we plan on having each night of
the week to get our customers in the door.
Indirect competition is plentiful in the city as there are lots of other establishments to dine. There
are many places to eat, however there are only few that have the luxury of TV’s surrounding
your chair and all the games of every sport streaming so you can watch the game you want or all
at once. Indirect competition, being all other restaurants, bars, fast food establishments, etc,
simply cannot compete with the atmosphere The Final Buzzer will create.
The Final Buzzer will hold a competitive advantage in the service we will provide. The Final
Buzzer knows the value of customer services and how important that is to customers. How we
will hold a competitive advantage is to offer higher wages to our employees and ensure that we
are efficiently staffed to meet the demands of our customers. Offering higher wages will allow us
to have more responsible and respectable staff, which will value and appreciate their job because
the reward and benefit is worthy.
4.6 Revenue Projections
The Final Buzzer projects revenues based on a conservative amount of customers per week then
broken into a matrix of expectancy for each time period during the day. Note: Days marked with
astrics are days prominent with games on TV.
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Revenue projections are then calcualated by an averaged purchase per customer of $16
mulitipled by averaged weekly customers of 1635, and growing over the 5 year period.
Percentage of sales is calculated in the first column with years 1 to 5 of projected revenues
following.
Revenues
Beer
Hard Liquor
Food
Total Revenues
% of
Sales
30.00%
30.00%
40.00%
100%
1
408,096
408,096
544,128
1,360,320
2
460,128
460,128
613,504
1,533,761
3
4
495,213
532,973
495,213
532,973
660,284
710,631
1,650,710 1,776,577
5
573,612
573,612
764,816
1,912,041
4.7 The Marketing Budget
The Final Buzzer has an allowance of $7375 to invest into our marketing strategy and plan. The
Final Buzzer is looking to effectively use radio and multiple vehicles to target our target market
that play in sports leagues throughout the city. A disbursement of how the funds will be allocated
is listed below in the following tables.
Radio Expense
Store Front Signage
Advertising (Marketing)
3000
3000
1375
The Final Buzzer emphasizes the importance of marketing and this is crucial when identifying
that our critical variable is the number of customers per day. The marketing plan will need to be
pursued with intensity and enthusiasm especially in the months leading up to The Final Buzzer
opening our doors and right when opening day is present.
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5.0 The Financial Plan
Financial projections have be based on a base case of 1,635 customers per week with average
purchase price of $16.00 dollars with an average Net Income over 5 years of $301,938.
5.1 Financing
The Final Buzzer will need to raise $1,900,000 to cover the amount of capital expenses as
mentioned previous in the Operations Plan. The
capital costs required to start up The Final
Buzzer is $1,830,000. Our debt to equity ratio is
63% from raising $700,000 in equity and
$1,200,000 borrowing from the bank. Connor
and Jordan both have banking experience and
believe that with the relationships they have with
Sales Officers at the bank that this amount of
borrowing debt is feasible.
By negotiating terms with our Sales Officers at the bank, we have projected receiving an interest
rate on our debt of prime + 3%, an interest rate of 6%. We also have projected that we will
amortize our debt payments over a 20-year period.
5.2 Dividends and Pay Back on Equity
Dividends will be paid out when Net Income is greater then $40,000. This is because the extra
cash will go back to pay back investors instead of sitting in Retained Earnings. Dividends are
projected to start being paid out in Year 2. The following table of Retained Earnings shows our
dividend payouts and Retained Earnings balances.
Retained Earnings
Account
Beg RE
Net Income
Dividends
End RE
Year 1
2015
0
238,731
0
238,731
Year 2
2016
238,731
267,743
279,816
226,658
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Year 3
2017
226,658
304,199
301,030
229,827
Year 4
2018
229,827
333,715
329,242
234,299
Year 5
2019
234,299
365,303
110,637
488,965
5.3 Break-even, Cash Flows and Sensitivity
Breakeven
Analysis
2015
2016
2017
2018
2019
Base Case
1,635
1,799
1,888
1,983
2,082
customer/week
Breakeven
871
951
934
945
955
customer/week
Analyzing our break-even and the sensitivity to the critical variable of customers per day, The
Final Buzzer has a sufficient gap between our base case scenario and our break-even customers.
It is important to get customers into the door and depend on our marketing plan. In order to
achieve our base case scenario, we must be effective and efficient in our marketing plan.
Factors contributing to a low break-even are the low inventory amounts being carried per week
and the number of days on accounts payable. Our costs are minimized and we are receiving cash
before we have to pay to suppliers. We have healthy cash flows, which can be found in the table
below:
Net Cash Flow
319,816
21,213
28,213
(218,605)
282,885
Net cash flows are negative at the end of the 3rd year as we are paying dividends also $250,000
into investment activities such as renovations and refurbishing, and this is why we are facing a
large cash outflow. Cash flows are recovered in the following year.
5.4 Investment Analysis
Payback
Value of the Equity
Net Present Value
Required ROI
IRR
Gross
Net
2,484,815
1,784,815
1,291,760
591,760
20.0%
46.4%
Based on conservative base case estimates and projections, The Final Buzzer requires a required
return of 20%. Based on our base case calculations, this scenario produces a return of 46.4%.
The Final Buzzer is both economically feasible and very profitable in our base case, and able to
pay back investors with dividends starting in Year 2.
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“Where sports live…”
6.0 Summary
After projecting our base case estimates, The Final Buzzer provides sufficient evidence that it
will be economically feasible and profitable. As long as we surpass our break even critical
variable of 871 customers per week, The Final Buzzer will see profits and positive cash flows in
the first year of operations. A detailed list of all financial projections and schedules can be found
in Appendix C.
The importance and need to focus on our marketing strategy to ensure that we will have no
difficulty getting customers into our sports bar and lounge is crucial. The Final Buzzer will be
consistent in providing quality customer service and providing an enjoyable environment,
through professionalism, efficiency and knowledge and experience. Completing these three
aspects we will build customer loyalty and relationships and create a strong reputation and brand
image to have repeat business from these customers. By completing these three aspects every
time for every customer, the positive feedback and word of mouth advertising done by these
customers is invaluable to The Final Buzzer. Therefore, The Final Buzzer will constantly
monitor our marketing efforts and ensure these needs are met for every customer.
The Final Buzzer will be “where sports live” and provide Saskatoon and residents with the
ultimate location to enjoy the games they enjoy watching. Whether it’s a meal for lunch,
grabbing a drink after work, or coming out to watch the big game on the weekend, The Final
Buzzer will be a fun and welcoming environment for all types of sports fans. When the game is
on, we’ll see you at The Final Buzzer.
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“Where sports live…”
Appendix A
PARKING
STREET
Site Map
THE FINAL
BUZZER
PARKING
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Appendix B
Menu
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Appendix C
Financial Plan and Model
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