Newlyn Ski Rentals

I. The Business

Newlyn Ski Rental and Tuning business is a top of the line rental business and has certified technicians to meet your needs. Newlyn Ski Rental and Tuning is located on Main Street in Presque Isle, Maine. The business is open to the public daily.

A. Inventory (parts and materials)

We chose one hundred skis because Big Rock has two hundred and Mt. Farlange had three hundred rentals. Rod and I decided to start slow in our business because we want to see how much business we will get.

POLE SIZES-

36cm-5, 38cm-5, 40cm-5, 42cm-5, 44cm-10, 46cm-20, 48cm-20, 50cm-20, and 52cm-10 =100 poles

SKI BOOT SIZES-

JRS- 12,13,1,2,3,4,5

LADIES- 5, 5.5, 6, 6.5, 7, 7.5, 8, 8.5, 9, 9.5, 10

MEN’S- 6, 6.5, 7, 7.5, 8, 8.5, 9, 9.5, 10, 10.5, 11, 11.5, 12, 12.5, 13, 13.5

B. Services

1. Rental Program

1. Tune-Up’s

1. Group Rate (ten or more)

C. What we are doing different

1. Fast Service

1. Top of the line skis

1. Top of the line snowboards

1. Early pick up rentals

1. Late drop off rentals

1. Call in reservation (after first time appearance in business.

1. Delivery service within Presque Isle, Maine (after first time appearance in business)

D. Marketing (Sales Potential)

In 1990 Aroostook County’s population was 10,550, in 1994 10,200 and is expected to decline to 9,668 by the year 2,000. The demographics of the market area. The median household income is $26,780 and the average age is 35.3. Our population is mainly blue collar jobs in farming and industry.

Two of our brand competition is Ski City and Big Rock, and they are both located in Mars Hill, Maine which is 15 minutes away. Our other computer is Mt. Farlange and they are two hours away.

Big Rock has- 200 skis, 200 boots, 200 poles, 20 snowboards, 20 snowboard boots, 5 demos.

Big Rock Rental Packages- Day skiing is $15.00, half day is $10.00, night skiing $10.00. Snowboards for the day is $20.00, half day is $15.00 and same for night skiing.

Ski City has- 200 skis, 200 poles, 200 boots, 10 snowboards, 10 demos

Ski City Rental Packages- Snowboarding and Skiing day package is $15.00 and half day is $10.00.

Ski City binding installment is $20.00

Mt. Farlange has 500 skies, 500 boots, 400 poles, 20 snowboards, 20 snowboard boots

Mt. Farlange Rental Packages-

Skiing Yearly- children $81.00

adults $130.00

Day rate- children $10.40

adults $14.30

Mt. Farlange tune ups are $18.20 and binding insulation is $10.00.

Based on Big Rock skier days of 1990 they had 10,000 skier days.(John Pierce, Personal communication, 12/2/96) We figure 1% will be rental customers. Therefore we’ve come to the conclusion that one hundred sets of rentals will be our demand for our business.

According to Key Real Estate the area we are proposing to rent for four months is zoned commercial and is located on Presque Isle’s Main Street. (Melanie Stewart, Personal communication, 12/2/96)

The store we are considering to rent is on Main Street in Presque Isle, Maine. Based on Under the Bike and Ski Rental program we need a total of 1,200 square feet. Rent of nine hundred dollars a month includes heat and electricity. We are going to use fluorescent lights to provide our lighting. There is parking in front of the store and also parking in the back of the store which includes handicap assessable parking as well. Aroostook County does not have public transportation. Labor supply is going to be favorable for the Presque Isle population creating four jobs for the community. We will supply adequate training and certification for our personnel. Fire and police protection will be provided by Presque Isle through their fire and police agencies. We will be renting a store located on Main Street in Presque Isle.

C. Attracting Customers

With our competitors being at the ski areas our advantages are different. Our shop will allow customers to pick up the skis the night before and return them the day of or morning after. This will allow them to get an early start and late finish. Another competitive advantage is Presque Isle is the most populated area compared to our surroundings. Also we have top of the line rental equipment and certified technicians.

Newlyn Ski Rental and Tuning--"The Best Skis And The Sharpest Tunes" will have a friendly and hospitable image. Our purpose is to help give the public their best experience skiing. Therefore we will adhere to their every need.

Rates

Skis

Adult Junior

Day-----------$15.00 $10.00

Night---------$10.00 $ 5.00

Weekend-------$25.00 $15.00

Seasonal-----$200.00 $150.00

Snowboards

Day-----------$20.00

Weekend-------$35.00

Night---------$15.00

Tuning Rates

Full Tune $20.00

Quick Tune $15.00

Stone Grind $25.00

Binding Mount $20.00

Remount $25.00

Binding Adjustment/release check $15.00

Wax $100.00

Screwdrivers $100.00

p-Tex. $ 50.00

Mounting Bench $300.00

Tuning Bench $600.00

Office Equipment $800.00

Office Supplies $ 50.00

Labor:

2 managers@ $10.00hr @ 40 hrs per week.

2 ski technicians@ $6.00hr @ 20 hrs per week.

2 rental attendants @ 5.00hr @ 20 hrs per week.

Total per month= $4,960.00

Operating Expense(monthly)

wages $4,960.00

utilities $ 300.00

rent $ 600.00

advertising $ 841.50

Insurance $3,000.00

equipment and supplies $ 50.00

taxes $1,400.00

total per month $11,151.50

750 skis per month x $15.00 per ski=$11,250 per month

11,250.00-11,151.50=98.50 profit per month

98.50/750=.15 per ski rental

Our competitors come from Big Rock and Ski City which are located in Mars Hill. With our competition having broader services than us we plan to prevail in the tuning and rental aspects.

Skis\Rental

Big Rock Ski City Mt. Farlange

night $10.00 $10.00 -----

day $15.00 $15.00 $15.00

group ----- ----- $10.00

seasonal ----- ----- $130.00

If the customer is not happy with the service we will give them a discounted price on the next rental. We have a no refund policy unless it is due to technical problems on the ski or binding.

We will use one main source of advertisement for our rental shop. This will be fliers put into the papers. The newspapers we will be advertising in are the Aroostook Republican, The Star Herald, and The Houlton Pioneer Times. The circulation for Star Herald will be 7,500, Aroostook Republican is 1,520 and the Houlton Pioneer Times is 6,000. So the total circulation is 18,700. Scott from the Star Herald said "it will be $45.00 per 1000 fliers" so our total advertising cost will be $841.50.

D. Selling To Customers

Our unit cost will be fourteen dollars and eighty five cents per rental ski. 15.00-.15= $14.85.

rent $600.00

utilities $300.00

wages $4,960.00

taxes $1,400.00

advertising $841.50

supplies $ 50.00

Total $8,151.50

E. Business Expenses

Fixtures and equipment

100 skis $9,000.00

100 bindings $5,000.00

100 poles $1,000.00

200 boots $13,000.00

10 snowboards $1,700.00

10 bindings $750.00

20 boots $1,800.00

1 tuner $12,000.00

1 torque $500.00

4 binding jigs $400.00

materials and supplies $2,000.00

utility deposit $300.00

Remodeling $1,000.00

permits,legal fees $125.00

operating cash $11,425.00

Total $60,000.00

F. Balance Sheet

Assets

Cash $11,425.00

Rental Inventory $32,250.00

Total current Assets $43,675.00

tuner $12,000.00

torquewrench $500.00

binding jigs $400.00

material/supplies $2,000.00

Total Fixed Assets $14,900.00

Total Assets $58,575.00

Liabilities and Net Worth

Not occurred

Total Liabilities

Not occurred

Total Net Worth $58,575.00

Total Liabilities and Net Worth $58,575.00

G. Summary

Our business Newlyn Rental and Tuning has the potential to be a successful business. It needs to be in a bigger area that is comprised of more skiers. If the business is successful, we will rein vest newer equipment, possible into renting cross-country skiing and a apparel shop. The reason why our business could fail are many not to exclude the weather being the biggest factor. Other reason could include lack of active skiers, fees to expensive or all of the above.

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