Sport Business Budget Project

Sport Business Budget Project

Student groups will develop a detailed budget (and complete a series of tasks) for a sport-related business (e.g., amateur softball association, amateur volleyball association, amateur baseball association, etc.). Groups will be created and assigned a business topic by the instructor no later than Week 3.

Using the 5-steps outline below, demonstrate your understanding of the management process with a detailed explanation of your event/program/business.

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Step 1: Provide a general explanation and overview of your event/program/business (i.e., what are you doing? How do you intend to make money? How will this endeavor work? Etc.) In addition to your description, provide the following information:

• What business structure did you select? Why did you select this business structure and what are some of the advantages/disadvantages that led to your decision?
• Identify and describe the different leadership positions in your business and the roles/responsibilities of each Each group member will serve a position in your business.

Step 2: Conduct market research and analysis to determine necessary information for a successful business and creating a strong budget.

• Industry Overview
  • Briefly describe the sport industry segment(s) in which your business operates (e.g., youth sports, amateur sports, event management, etc.)
  • Identify industry size, trends, growth, and recent developments
  • Estimate how big the market is and how fast it’s

Sport Business Budget Project

o   Group must include statistics and research findings from credible sources.

• Sport Consumers
  • Who would purchase your products/services? What are their demographics, psychographics etc.
  • Define the primary target audience (demographics, psychographics, location).
  • Include a customer profile: age, interests, income, sport participation
  • Provide statistics or detailed explanation of the target market (i.e., I want to know specifically who you think will purchase your products/services).
  • Explain why this audience is a good fit for the product/service.
• Needs Assessment
  • Identify an issue, gap, or opportunity in the
    • This could be things such as: high demand and low opportunities; low quality offerings; large target market but limited opportunities; low opportunities in certain areas/regions; etc.
  • For this section, the opportunity that most groups may identify is a location to establish their business based on one or more of the examples above.

Sport Business Budget Project

o   Groups should provide support the opportunity exists with research, statistics, and articles.

• Explain how your business will address these
• Competitive Analysis
  • Identify at least 2 direct competitors.
  • Provide information on the competitors product/service offerings, pricing, target market, and positioning.
    • Positionings is how do these businesses differentiate themselves from the
  • Highlight your business’s competitive advantage and how you will differentiate your business from the competition.
• Product Identification
  • What are your products and services?
  • Provide detail explanation of your products/services
  • What do customers receive? If you are offering packages, you will explain what is included in each package.

Sport Business Budget Project

• • • Every revenue stream you include in your financial section should have an accompanying product/service description.
• Price the Product/Business/Event
  • Based on your market analysis, determine the value(s) of your product(s) by assigning it a price(s).
  • What will customers pay for your products/services?
  • These prices should take into account the information you obtain in your market
  • Every product you identified in the first bullet point should have an accompanying price in this section.

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Step 3: In this step, students will describe the location of the business. Students should include a detailed explanation for why this location was selected (i.e., why is this the right location; what factors lead to this decision; etc.). Students should include research and statistics (cited evidence) to support the selection of location. Groups can use cited evidence provided in the previous section. The location of your business should be determined by the research you conducted in the prior step (this is the gap or opportunity for most groups).

Groups will also describe the facility requirements for their business. This step will include information such as:

• Facility for business operations (i.e., management team, sales staff, etc.), if needed
• Facilities for events or programs. Where will your events take place? What do the facilities you selected offer (e.g., size, space, field conditions, concessions, )? What do the facilities look like?
• Groups must include pictures of the facilities chosen and provide detail descriptions of each (see previous bullet point).

Sport Business Budget Project

Step 4: This step will include the financial projections for your business. Students need to provide detailed information regarding their revenue streams and expenses. With regards to revenue, what are you selling, how many are you selling, and how much are you making in total. Your expenses will have a similar breakdown such as what are your monthly expenses, how much is each expense, and what are your total expenses each month/year. Groups will provide Excel spreadsheets for their startup costs (what are all the things you will need to begin your idea and how much do they cost), Year 1, Year 2, and Year 3 budgets. Items included in your budget could include, but not limited to: monthly rental/purchase fees, utilities, equipment, marketing, employee salaries/benefits, etc. Also display total revenue, total expenses, and profit/loss.

Budgets should be formatted in a manner that is easily readable. Use gridlines when including in your final draft.

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For this section, groups should have at least 4 spreadsheets.

• Start Up Costs
  • This would include everything you need to get your business started before you “opened” for business. This could include, but not limited to: equipment (for product and services as well as office); facility construction/renovations; marketing; salaries for some employees (mainly management); operating capital; transportation; etc. This really depends on your business.
  • You will include detailed explanation for each item listed in the start up cost spreadsheet
• Year 1, Year 2, and Year 3 Spreadsheets
  • In these spreadsheets (3 separate), you will provide detailed explanation for each revenue stream and expense category. This means, you will show your calculations for each revenue stream and expense category on the spreadsheet.

Sport Business Budget Project

The finance section of your project should also include a written portion. In the written portion, groups will explain how they determined the price/costs of items, how they determined the number of items sold, and where they obtained this information. The section should also summarize the information provided in the spreadsheets, highlighting major categories and profit/loss.

Step 5: Finally, students will include a detailed explanation for how they intend to finance their business and business operations (i.e., debt, equity, retained earnings, etc.). Your business will need a combination of funding sources (just like real businesses). Students should also include why the funding sources chosen are the best decisions for their business, and discuss the advantages and disadvantages of the sources selected.

Your Year 1, Year 2, and Year 3 budgets should reflect the financing option selected. It is EXPECTED that every group will have to obtain a bank loan. Your bank loan repayment must be included in your monthly expenses.