Illiniwek Unlimited Shooting Coyle Popoca Damarin Kimbrough

Transcription

1 Illiniwek Unlimited Shooting Coyle Popoca Damarin Kimbrough 1

2 Table of Contents...2 Executive Summary... 3 Industry Research... 4 Industry Growth... 4 Products and Services/New Developments and Trends... 5 Industry Sectors and Revenue... 7 Shooting Range Competitors Decatur Range Marion Range Peru Range Target Market and Customer Potential Business Opportunity and Market Fit Market Strategy Location and Range Services Promotion and Advertising Management and Legal Structure Financials Exit Strategy Works Cited

3 Executive Summary The shooting industry in Illinois is growing and it does not look as though it is going to be stopping anytime soon. There are new shooters coming into the picture, and this is crucial to a new range s success. The fastest growing sectors in the group of shooters are women and people wanting to learn how to shoot handguns for self-defense. By taking advantage of this new wave of shooters, Illiniwek Unlimited Shooting can soar up and over the competition. The start-up costs for the initial opening of the business is $230,458 for each range. This is a hefty price, but this is a small investment when looking at the possible profit from the business. Illiniwek Unlimited Shooting is a membership based range, and the memberships will come with certain benefits and services. Illiniwek Unlimited Shooting is focused on servicing the shooters with what they need rather than profiting from the selling of ammunition, guns, or cleaning supplies. While these items will be sold, they will be sold to members for a profit of only ten percent. This will be attractive to many people who are trying to find a range to learn how to shoot and shoot for fun. Another aspect of Illiniwek Unlimited Shooting is its focus on the new and upcoming shooters. With the concealed carry law passing and the growth in the self-defense and women sectors of the market, Illiniwek Unlimited Shooting plans to offer lessons catered to each student s needs. With this growing base of customers, Illiniwek Unlimited Shooting is looking at $223,666 in profit for the first year. This is without accounting for the increase in lessons due to soon to be introduced concealed carry law. The high profit stems from the memberships and lessons. There was a 7% increase in the number of licensed gun-owners in Illinois from 2011 to Now there are 1.4 million licensed gun-owners in Illinois, and that number is steadily increasing. This population of shooters is where Illiniwek Unlimited Shooting will find its 3

4 members, and at Illiniwek Unlimited Shooting, this population of shooters will find value and make use of their second amendment rights. Industry Background and Research Over the past few years, the shooter population has been growing. The estimated total number of shooters in the United States in 2009 was 34,400,000; or 11.20% of the total population. Within the United States, the east north central area contains 17.6% of the total shooters population. This is the highest population of shooters in the country due to the flat land, various game species, and numerous hunters. White males are the highest shooter population, therefore a high population in white males results in a high population of shooters in the area. Some of the fastest growing populations within the shooting industry are women shooters and those interested in learning self-defense. Industry Growth 4

5 All industries experience an increase and decrease at some point in time or certain sectors within the industry. It all depends on the supply and demand for the product or service. Overall, shooting activity in 2011 has been on the rise. There was a total of 62.3% of an increase in activity, 27.4% stayed about the same, and 10.3% of a decrease. The industry appears to be fairly stable with activity, with only a minor percentage decreasing. Statistically, there has been an overall growth in the shooting range industry. The number of trap and/or skeet targets thrown increased an average of 31.2%, 50% remained the same, and 18.8% decreased in Therefore, although there is a slight decrease in trap and/or skeet targets being thrown, there is a greater increase than the previous year. In 2001, there was a greater increase in skeet rounds sold than in trap rounds sold. Skeet rounds sold increased by 41.4% while trap rounds sold only increased 25%. Trap rounds sold had a higher percentage remaining the same at 55% in comparison to skeet rounds sold 5

6 percentage of 48.3%. Trap rounds sold also experienced more of a decrease than skeet. Trap rounds sold decreased by 20% and skeet rounds sold only decreased 10.3%. Based on the average number of handgun customers in 2011 being 15,643 there has been a significant increase in customers. Since the previous twelve months, handgun customers increased by 66.9%, 29% remained the same, and only 4% decreased. Also, in 2011 based on 2,200 rifle customers there was a 48.5% increase in customers, 44.6% remained the same, and a mere 6.9% decrease. Within the next few years, this number will see a spike due to the upcoming concealed carry law in Illinois. Products and Services/New Developments and Trends OVER THE PAST 12 MONTHS, HAS MEMBERSHIP AT YOUR RANGE/CLUB: Decreased Significantly 1% Decreased Somewhat 7% Stayed About the Same Increased Somewhat 33% 35% Increase Significantly 24% 0% 10% 20% 30% 40% 6

7 With such a high interest in this industry, many new shooting ranges are sprouting all over the United States. One reason for such an increase in ranges is the increase in membership to ranges and clubs. 81% of ranges offer memberships and over the past year, memberships have increased 59% and 33% have stayed somewhat the same. With this being said, memberships have only decreased by 8% over the past year. Throughout most industries there are decreases in at least one area of the industry though, so an 8% decrease in membership is not a lot. Therefore, many ranges are beginning to include memberships if they do not already have them. 7

8 What many people find surprising is that some of the fastest growing sectors within the shooting industry are the women population and training or self-defense; therefore most successful shooting ranges and clubs offer both training or self-defense classes and a women s program. Between 2004 and 2009 there was a slight decrease in male shooters. They decreased by 7% within the five years. The percentage of female hunters actually increased by 23% within the same five years. There are not as many female hunters as male hunters in thousands, but the number of female hunters continues growing. Although, only 38.5% of ranges offer the women s program, they are said to be very successful due to the small percentage of ranges including them. With supply being fairly low and demand being so high, those offering the program have a greater success rate. Offering a women s program reels in more customers from not only the female population, but also possibly the male population. This is because if a married woman is in search for a range with a women s program, her husband is also more likely to go to that same range due to convenience; increasing the total clientele. Technology is also now being incorporated in training and self-defense classes to minimize injury of any sort for beginners and maximize performance. Also, depending on whether a training class is offered at ranges, there are a variety of ways they can be offered depending not only on what sector the range is targeting population wise, or times the training is available. A 50% majority of ranges appear to have both individual instruction and training classes and only a mere 6.6% of ranges do not have instruction classes. Due to the increase of training and self-defense classes, technology is beginning to grow within shooting ranges and clubs. There is now advanced technology that helps track where the shooter shot, saving money on ammo. This is a logical and efficient way, not to mention safer, to train because the shooters 8

9 get to see where they shoot and they do not have to spend as much money on ammo. Both areas are foreseen to bring in more revenue due to their growth in the industry. Another development in the industry that applies specifically to Illinois is the introduction of a new concealed carry law. This will greatly stimulate growth in the already growing handgun/self- defense sector of the ever-expanding market. When memberships decrease, shooting ranges put an emphasis on the retail portion of the business. Although the majority percentage of shooting ranges, 67.9%, do not have a pro shop, they have shown an increase in sales. Possible reasons for the increase in sales could be convenience and the low amount of supply with the high amount of demand. Due to this information, new developing shooting ranges are beginning to incorporate pro shops in hopes of increasing their total revenue. This will not increase revenue greatly, but it will sure help. This is a wise decision because more shooters will want to attend ranges with ammo there due to convenience. Industry Sectors and Revenue 9

10 The shooting range industry can be broken down further besides the obvious increase and decrease in business. Ranges may fall under one of the four categories: publicly-owned, commercial range; privately-owned, commercial range generally open to public use; privatelyowned, commercial range open to public use during limited, specific hours; or privately-owned, commercial range never open to public use. Depending on the category the range falls under is what determines membership and activity rates. Privately owned, commercial ranges that are never open to public use are the ones that are the most active with a total increase of 76.9%, 23.1% of activity remaining the same, and 0% decrease. No other category of ranges has a 0% decrease in activity. The way they deal with their memberships is also different. This sector has the lowest percentage rate under the membership is unlimited category, falling at 28.6%. The highest percentage under the membership category for this sector is membership is capped, but we have openings. Basing assumptions off of this sector, it appears that having limited memberships seems to drive range activity up. Revenue that goes along with this sector is interesting. Although this sector has the most growing activity rate, 60% of annual revenue falls under less than $100,000; 20% $100,000 to $299,999; 10% $300,000 to $499,999; and the other 10% $1,000,000 to $2,000,000. Publicly owned, commercial ranges are the following sector doing well in activity. The unusual thing about this sector is that unlike all the other sectors, 0% of activity has remained the same; activity has either increased or decreased. There was a 40% significant increase and 50% of somewhat of an increase. Only 10% of activity decreased 10

11 somewhat. These ranges also have the highest percentage rate under membership unlimited with 100%. Their revenue percentages are the following: 33.3% is less than $100,000; 55.6% $100,000 to $299,999; and 11.1% is more than $2,000,000. Privately owned, commercial ranges generally open to public use is the following sector doing well according to activity on the range with 21.7% of significant increase and 50.9% of somewhat of an increase. 20.8% of the activity remained the same with 4.7% of somewhat decrease and 1.9% of a significant decrease. Annual revenue for this sector is more evenly distributed with the following percentages: 25.3% is under $100,000; 18.4% $100,000 to $299,999; 14.9% $300,000 to $499,999; 14.9% $500,000 to $999,999; 10.3% $1,000,000 to $2,000,000; and 16.2% $1,000,000 to $2,000,000. This sector has the highest percentage rate under the $1,000,000 to $2,000,000 compared to the other three. The sector doing the worse out of the four is privately owned, commercial ranges open to the public during limited, specific hours. This sector has the least amount of increase in activity with only 16.4% of a significant increase and 35.8% of somewhat of an increase. It also has the highest percentage rate for activity remaining the same with 29.9% and also the highest decrease percentage rate with 16.4 of somewhat of an increase and 1.5% of a significant decrease. Annual revenue for this sector also has a high percentage rate under the lowest amount of annual revenue category. Its annual revenue can be broken down with the following percentages: 59.6% is under $100,000; 13.5% $100,000 to $299,999; 7.7% is $300,000 to $499,999; 9.6% $500,000 to $999,999; 3.9% $1,000,000 to $2,000,000; 3.8% is more than $2,000,000; and 1.9% is nonprofit. This is also the only sector with a percentage rate above zero under the non-profit category. Overall, the shooting range and club industry is growing. There is particular growth in various sectors, but that is increasing the total growth and revenue for businesses. The important 11

12 things for new ranges to take advantage of would be the upcoming shooters. This includes targeting women and those interested in self-defense. With the new concealed carry law coming into effect, the profits could be enormous. With various enhancements or additions to the shooting industry, revenue could increase significantly. 12

13 Shooting Range Competitors In the Decatur Area: Currently there are three shooting range/gun club competitors in the Decatur area. The competitors are: The Bullet Trap (9.5 miles south of Decatur) The Decatur Gun Club (in Decatur) Warrensburg Sportman s Club (9.9 miles northwest of Decatur) Only one of the shooting ranges around the Decatur area is actually in Decatur and that is the Decatur Gun Club. Because it is located in Decatur, it is more convenient to use than the Bullet Trap or the Warrensburg Sportman s Club. However, the Decatur Gun Club is an outdoor shooting range only. This means that it can only be open on certain seasons and at certain times during the day the same being said for the Warrensburg Sportman s Club. The Bullet Trap is an indoor shooting range and, therefore, is opened year-round. However, the Bullet Trap is

14 miles from Decatur and is, therefore not conveniently located for the use of the people in the Decatur Area. ( X means that the product or service is provided at the shooting range/gun club) Products and Services of Shooting Ranges/Gun Clubs in Decatur, IL Products and The Bullet Trap The Decatur Gun Warrensburg Services Club Sportsman s Club Ammunition X X Apparel Cleaning Supplies X X Events and Contests X X Food X X Guns X Gun Cleaning Gun Safety Lessons X X X Indoor Shooting X Memberships X X X Outdoor Shooting X X Rentals Guns X X Rentals Building X Shooting Lessons X X X Trap Shooting X X 14

15 The shooting ranges/gun clubs surrounding the Decatur area provide a large variety of services. Their main services are often sales, lessons, rentals, lane use, memberships, and events. The shooting range with the most variety of services is the Bullet Trap, while the shooting range with the least amount of services is the Warrensburg Sportman s Club. The Bullet Trap sells guns and all that is needed to shoot and properly take care of a gun ammunition, targets, and cleaning supplies. They, also, sell apparel that features the name of their business. The Decatur Gun Club only sells ammunition, while the Warrensburg Sportman s Club sells nothing at all. Because the Bullet Trap sells guns, it becomes not only a shooting range but a gun store as well. This opens the Bullet Trap to a whole different market, but it can also take away from the Bullet Trap s focus as a shooting range/gun club. All ranges in the Decatur area provide shooting and gun safety lessons. However, the Decatur Gun Club and the Warrensburg Sportman s Club teach their customers how to shoot trap. This makes the Bullet Trap the only shooting range that provides lessons on shooting for self-defense with a pistol/handgun. Both the Bullet Trap and the Decatur Gun Club provide gun rentals. This opens the range to the walk-in customer and to the customer who may not own a gun, thereby providing a wider range of customers and a wider range of conveniences for the customer. The Warrensburg Sportman s Club does not provide gun rentals and, therefore, is not geared towards walk-in customers or customers who do not own a gun. Another service provided by shooting ranges/gun clubs around the Decatur area is the use of their shooting lanes. Because the Warrensburg Sportsman s Club is more geared towards its members rather than walk-in customer, the Warrensburg Sportsman s Club only has its lanes open for its members. Therefore, the members pay for their use of the range in their membership 15

16 fee rather than by daily or hourly use of the range. The Bullet Trap charges $16 daily for the use of one of their shooting ranges. Shooting Range/Gun Club The Bullet Trap ( X means that the product or service is provided at the shooting range/gun club) Examples of Shooting Range/Gun Club Walk-in Costs and Services Cost of Walkin Includes Cost of Using the Range $16 X Includes Cost of Ammunition Includes Discounts on Ammunition Includes Cost of Gun Rentals Annual Costs For Walk-In (on 365 day basis) The Bullet Trap $5,840 Memberships are a very important service provided by the shooting ranges/gun clubs around Decatur to their customers. By providing memberships, shooting ranges/gun clubs draw in more customers because of the benefits that being a member of those shooting ranges/gun clubs can provide. For example, by choosing an annual membership at the Bullet Trap, you decrease the amount you would spend through frequent lane use by paying a lump sum at the beginning of the year rather than a walk-in fee for every time you went to use the range. A relatively new business having opened last year (2011), the Bullet Trap currently boasts a membership of 1,600 people. The Decatur Gun Club provides discounts on its ammunition to members. The Warrensburg Sportsman s Club provides members-only meals. ( X means that the product or service is provided at the shooting range/gun club) Examples of Shooting Range/Gun Club Membership Costs and Services Shooting Cost of Includes Cost Includes Cost Includes Includes Cost Range/Gun Annual of Using the of Discounts on of Gun 16

17 Club Membership Range Ammunition Ammunition Rentals The Bullet $299 X Trap The Decatur $70 X X Gun Club In order to help draw in more customers and more fully satisfy their members, the shooting ranges/gun clubs in the Decatur area host shooting events and contests. The Decatur Gun Club and the Warrensburg Sportsman s Club both hold these kinds of events, providing trophies and prizes for the winners. In the Marion Area: The nearest shooting/gun ranges to Marion, IL: 17

18 Apple Creek Shooting Range (37 miles southwest of Marion) Rend Lake Shooting Complex (27.4 miles north of Marion) Ten Mile Creek Rifle Range (32 miles northeast of Marion) To begin with, there were not a lot of shooting/gun ranges to be found in Marion, which provides a wonderful opportunity for building a shooting/gun range within that area. For having a shooting range in the location of Marion, IL, there is not any competition to be found that is not at least of 20 miles away. 18

19 ( X means that the product or service is provided at the shooting range/gun club) Products and Services of Shooting Ranges/Gun Clubs in Marion, IL Products and Apple Creek Rend Lake Shooting Ten Mile Creek Rifle Services Shooting Range Complex Range Ammunition X Apparel Cleaning Supplies Events and Contests X Food X Guns X Gun Cleaning Gun Safety Lessons X Indoor Shooting Memberships X X Outdoor Shooting X X X Rentals - Guns X Rentals - Building Shooting Lessons X Trap Shooting X X X The Apple Creek Shooting Range is not really a business. In fact, it is a piece of land connected to a conservation forest where people can go to shoot. There are no memberships available and no price for using the range. One must provide their own gun and ammunition. 19

20 Apple Creek Shooting Range is not located conveniently for people who live around the Marion area. It is an outdoor range and therefore has time constraints due to seasons and time of day. Being part of a free park, people have to worry about others who are using the area such as children. Because of safety concerns, the use of the park as a shooting range is possible to come to an end. The closing of Apple Creek Shooting Range provides opportunity for an incoming shooting/gun range in the area. The Apple Creek Shooting Range is the only competition that is a free shooting range. The Rend Lake Shooting Complex is the closest and most worrisome competition for a shooting/gun range located in Marion. However, The Rend Lake Shooting Complex is still over 20 miles away from Marion, which takes away from the convenience of a shooting range being located in the Marion area. The Rend Lake Shooting Complex provides outdoor trap shooting to its customers and memberships to benefit their regular customers. Members still have to pay full price for their ammunition and gun rentals though. You can buy ammunition, guns, and cleaning supplies at the range. You could also just choose to bring your own gun and ammunition. They provide lessons for those who want to learn how to trap shoot. Because they are an outdoor range, they have seasonal and daily limits on the use of their range. The Ten Mile Creek Rifle range is 32 miles northeast of Marion. It is a range geared more towards experienced shooters or those who want to be members rather than walk-ins or people who want to learn how to shoot. The range does not provide ammunition or guns. You can become a member and use the range, but there are no special benefits for its members. As an outdoor shooting range, the season and time of day affects when a person can shoot or not. In the LaSalle-Peru Area: 20

21 Shooting/Gun Ranges in the LaSalle-Peru Area: The Buffalo Pit & Range (15.3 miles west of LaSalle-Peru) Str8 Shotgun Safety (25.9 miles west of LaSalle-Peru) ( X means that the product or service is provided at the shooting range/gun club) Products and Services of Shooting Ranges/Gun Clubs in LaSalle- Peru, IL Products and Services Ammunition Apparel Cleaning Supplies Events and Contests Food Guns Buffalo Pit and Range X X X Str8 Shot Gun Safety X X 21

22 Gun Cleaning Gun Safety Lessons X Indoor Shooting Memberships X Outdoor Shooting X X Rentals - Guns X Rentals - Building X Shooting Lessons X Trap Shooting X There are two competitors for having a shooting range in the LaSalle-Peru area. The Buffalo Pit & Range is a shooting range geared towards the walk-in experienced shooter. They do not rent guns or sell guns. They do not sell ammunition. The person who wants to use the range must provide what they need in order to use the range. The range does not provide shooting or safety lessons to inexperienced shooters. The Buffalo Pit & Range mainly earns its income from the fee that shooters pay in order to use their range. They, also, sell apparel and cleaning supplies. People can rent the area if they want to have a shooting range at their use for a special occasion such as a birthday party. Because of safety concerns, it is questionable as to whether or not the Buffalo Pit & Range will even stay in business. As an outdoor shooting range, there are limits on the amount of time that the range can be available for use. ( X means that the product or service is provided at the shooting range/gun club) Examples of Shooting Range/Gun Club Walk-in Costs and Services 22

23 Shooting Cost of Includes Cost Includes Cost Includes Includes Cost Range/Gun Walk-in of Using the of Discounts on of Gun Club Range Ammunition Ammunition Rentals The Buffalo $10-30 X Pit and Range Annual Costs For Walk-In (on 365 day basis) The Buffalo Pit and Range $7,300 (based off of average cost) Str8 Shot Gun Safety is a range based solely on teaching others how to shoot. You choose your lesson plan and the benefits that go along with that plan, such as a certain amount of free coffee and doughnuts. The range can only be used for shooting training only, and therefore, you cannot use it once you learn how to shoot. This is inconvenient for those who want to have a place to shoot. ( X means that the product or service is provided at the shooting range/gun club) Example of Gun-use Lesson Prices and Services Shooting Cost of Includes Includes Includes Cost Includes Food Range/Gun Lessons Training Gun Rental of Club Ammunition Str8 Shot Gun $ X X X X Safety 23

24 Target Market & Customer Potential Licensed Shooters in Illinois Licensed Shooters The main target market for a shooting range is licensed shooters. In the state of Illinois, there are currently over 1.4 million licensed shooters, the number having increased from 100,000 people within a year (licensed shooters had in 2011 been totaled as 1.3 million). This shows a growing market of licensed shooters which shows the increase in the demand for shooting ranges/gun clubs to provide them with the ability to use their shooting privileges and skills. 24

25 Because Macon County, LaSalle County, and Williamson County are mostly rural areas, a shooting range located within those counties would have access to the bulk of the target shooter population, roughly 40%. A shooting range that is located closer to a small city, while also being surrounded by rural areas, would have access to even more of the target shooter population. A shooting range around locations such as Decatur, LaSalle-Peru, and Marion could expect to have access to 70% of the total target shooter population. Ethnicity Dispursement 1% 4% 8% 87% Caucasian African American Asian Other 25

26 Because the regions of Macon County, LaSalle County, and Williamson County consist of a population that is 87% caucasion. Caucasian shooters are more likely to use a shooting range in those areas. Therefore, caucasion shooters would be an important target for a shooting range in those areas. 85% of the sporting clay participants in 2001 were male shooters. Though the number of female shooters has increased over the years, male shooters still make up the majority of the market. This is why it is important that a shooting range includes the male shooter within its target market. 26

27 Male shooters are, also, more likely to visit a shooting range/gun club on a more regular basis, 37% of the male population visiting a range for rifle target shooting more than 10 times in a year vs 10% of the female population visiting for more than 10 times in a year. However, 98% of the female shooter population is likely to visit a range for rifle target shooting at least once a year. 99% of the male shooter population is likely to visit a range for rifle target shooting at least once a year. 27

28 42% of the male shooter population would visit a range for handgun shooting more than 10 times a year while 18% of the female shooter population would visit a range for handgun target shooting more than 10 times a year. 99% of the male shooter population is likely to visit a range for this service at least once a year, while, once again, 98% of the female shooter population is likely to visit a range for this service at least once a year. 24% of the male shooter population would visit a shooting range for sporting clay shooting more than 10 times a year. Only 14% of the female shooter population would visit a shooting range for sporting clay shooting more than 10 times a year. 99% of the male shooter population would visit a shooting range at least once a year for sporting clay shooting. Surprisingly, 100% of female shooters would visit a shooting range at least once a year for sporting clay shooting. This shows that the shooting of clays is a service of much interest for the 28

29 growing market of female shooters. Female shooters are a growing market in the shooting range industry. 35% of the female shooter population can be found within the Midwest. This is the highest percentage out of any region in the United States of America. Female interest in target shooting has, also, been growing. Because the female shooter population is growing and their interest in shooting ranges is growing, female shooters are an essential part of a shooting range s target market. 29

30 Shooting ranges and gun clubs have members of various ages. However, the largest amount of shooters is between the ages of 16 and 54 years old. The graph above depicts an increase in the total amount of hunters up to the age of 34. It levels off from the ages of 35 to 54, and then from the age of 55 and up, it begins to decrease. By targeting shooters between the ages of 18 and 49, a shooting range would be able to reach the bulk of the shooter population. Target Market Populations Male When looking at the caucasian licensed shooters who are both male and female and between the ages of 18 and 49 because they were shown to be more likely to participate in the use of a shooting range, the target market for a shooting range in the areas of Macon County, 30

31 Williamson County, and LaSalle County narrows to an average 3,718 targets per location. The target market, however, has the ability to be broadened because it does not take into account upcoming shooters, shooters who do not fall in the target age range, and licensed shooters of different ethnicities. 31

32 Business Opportunity and Market Fit Looking at the facts, Illiniwek Shooting Unlimited has a great business opportunity to step in and take the increasing shooting industry by storm. Obviously the market itself is growing at a steady pace, and Illiniwek has the crucial differences that would make a customer want to be a member. To start off, there are many different parts to the shooting industry. There are target shooters, hunters, and those interested in self-defense. Within these groups, the fastest growing sectors are that of women and handguns shooting (most likely part of the self-defense sector). The largest sector is that of white males over the age of 18, and the most common item people shoot at ranges are rifles. Furthermore, Illinois is in the most active region, East North Central Region, for shooting ranges in the United States. It leads with a whopping 17.6% over the second highest with only 14.1%. Not to mention the fact that 17.1% of the ranges in these five states make over $300,000 in annual gross revenue. Along with this, there is a lack of ranges in Illinois that are designed like Illiniwek. Most of the immediate competition lacks many of the services and capabilities that Illiniwek has. So there is room for Illiniwek to not only enter the market, but to become a dominant force. Illiniwek will be seen as a higher quality range, but not a high roller. Some high roller ranges charge up to $10,000 a year. However, Illiniwek will be better than the average range. By examining this information, there is a variety of different approaches that would make Illiniwek Unlimited Shooting fit in the market. Illiniwek will have the classic feeling of a range, and promote relationships among members through shoots and other special events which will attract the already active shooter. Also, Illiniwek will offer a variety of classes that will cater to 32

33 each individual s needs and this will help attract the new and upcoming market of soon-to-be shooters. Some other services that will be provided to members will be free gun cleaning, discounted gun cleaning supplies, discounted ammunition, lane priority, discounted rental guns, and access to all three ranges at any time during the range s operating hours. The one thing that Illiniwek will focus on is service. Many competitors focus too much on selling guns, ammunition, and apparel. The thing that will push Illiniwek over the top will be the fact is the priority it places on customer service. What little goods that are going to be sold are purely things that the customers need to shoot. These goods will be offered to members just above wholesale price, so Illiniwek still does make a small profit. The main idea is to get the customer to enjoy the range enough to where he or she will want to keep coming through the years. The biggest thing is the discounted ammunition. With low ammunition prices, Illiniwek will attract many members from all over just because ammunition is so expensive to shoot anywhere else. Plus some of the rental guns we have are unique and people will pay to shoot a.50 caliber or other specialty guns. With a wide variety of shooters to draw in living in the state of Illinois, Illiniwek Unlimited Shooting will outweigh and outmatch the competition with its standards, values, and services that make it the appropriate choice for shooters. With the exclusive benefits that come with the purchase of a membership, along with the ability to shoot year round thanks to Illiniwek s heated shooting boxes, target shooters, hunters, and beginners will find that Illiniwek is the range of choice. 33

34 Marketing Strategy Illiniwek Unlimited Shooting will strive to create a range that is a top of the line facility with cutting edge technology, all the while maintaining a feeling of family among the members of its society. Not only is there room in the steadily increasing shooting industry, but its ranges will seem like the appropriate choice for many people and it has the capability to be able to steal some of the competition s shooters. 34

35 Location and Range Illiniwek Unlimited Shooting will be an elite gun club with three locations. There will be three ranges: one in Decatur, one in Marion, and one in Peru. Each location was chosen for the lack of able competition and the coverage of Illinois. One is in the south, one is in the center, and one is in the north. This helps Illiniwek take the business of one of the busiest states for ranges nationwide. Each range will consist of 4.5 acres of land total. There will be a 4,800 square foot building on the range that will serve as the headquarters for the customers to purchase ammunition, rent guns, buy memberships, etc. Any member can attend any of the three ranges, for they will all be ran on the same system. 35

36 Services Illiniwek Unlimited Shooting is a service based business. By purchasing a membership, shooters can obtain these many services. The biggest thing that Illiniwek Unlimited Shooting can offer its members is the feeling of the traditional range. The reason the range feeling will stay traditional in most aspects is the fact that the most dominant group in the shooting industry is white males over the age of 18. This, along with other aspects that separate Illiniwek from its competition, will help draw in members from this crucial group of potential customers. Another service that will be offered at Illiniwek Unlimited Shooting will be gun lessons, which members receive discounts on. With the shooting industry growing substantially, there is a great opportunity to make more money with lessons, because people have to learn from somewhere. Among this group of beginners lie two dominant forces, people who want to shoot handguns for self-defense and women shooters as a whole. Another factor in this equation is the upcoming concealed carry law in Illinois. This will increase the market for potential students and members greatly. Classes that are catered to the different individuals needs will be offered as a great way to become a marksmen or markswoman. Also, the technology that goes into the training will be a feature that attracts many. Illiniwek mentors will make use of electronic training equipment, that way the customer, and Illiniwek, can save money on ammunition. This is also great for kids because it is much safer, keeping parents minds worry-free. Illiniwek Unlimited Shooting is also going to offer year-round outdoor shooting. The range will have boxes placed at the head of each shooting lane. These boxes will have heaters 36

37 that will help keep shooters warm in the cold weather. This is ideal for trap shooters and highpowered rifle shooters. This way, they will not have to wait until the weather warms up to have a great shooting experience. Another great edition to the shooting experience at Illiniwek will be the discounted exploding targets and the quality clay pigeon throwing machines. Trap and skeet shooters will love the advantage of the automatic throwing machines capable of firing multiple pigeons at a time. This will help the trap shooters and small game hunters better their shot so they bring home the game. Also, everyone loves to see things explode. One of the best attributes of Illiniwek Unlimited Shooting is the rental guns. Each range will be equipped with a selection that will draw people away from competing ranges. There will be numerous shotguns, rifles, and handguns that will allow members to pick and choose from almost any caliber or gauge they could think of. This will be good for people who wish to shoot high-powered rifles because they really cannot shoot them in Illinois due to the flat land. Even though rifle and shotgun are the dominating factors in the field so far, handguns are coming out of the shadows thanks to the beginners who wish to learn self-defense. This will be the perfect feature for such people, since they will be able to shoot many different calibers and take the lessons along with to be able to defend themselves, their family, and their home. A few other services that members will be able to take advantage of will be discounted ammunition, discounted gun cleaning supplies, and free gun cleaning services. The discount on ammunition will attract many customers because ammunition is very expensive. Also, with free gun cleaning services the members can also save the trouble of having to clean their gun after 37

38 they shoot. Also, for when they do not shoot at the range or when it comes time to maintain their guns, we have high quality cleaning products at hand for low prices. These services combined with the great experience one gets from a membership at Illiniwek Unlimited Shooting easily outweigh the price of a membership for the customer. Gun clubs across the United States are experiencing an increase in memberships and in members participation. Illiniwek Unlimited Shooting will be no exception. Its memberships will be priced higher due to the fact that we are a higher-end gun club. The price for a full year will be $350, while the half year will be $225. The prices are higher in order to pay for the advantages of being a member, such as discounted ammunition and cleaning supplies, exclusive access to the members only lounge, free gun cleaning services, and so on. The discounted ammunition will be sold just above the wholesale price. This will be very attractive to many customers since ammunition is very expensive. With the discounted goods, the customer will see the value of the membership that will most likely save them more on ammunition for shooting, and in turn, Illiniwek makes more money. There are also the different options for a six month membership or a yearly membership. The yearly membership will be strategically priced lower in a six month span so more members will find value and purchase the yearly membership. Even though Illiniwek has a year-round range, its participation will most likely still slowdown in the winter so the yearly membership will aid in keeping up with the cost of running the facility. 38

39 Promotion and Advertising As an initial promotional maneuver Illiniwek Unlimited Shooting will hold a grand opening lasting a week long. Monday through Thursday there will be free lessons teaching some about self-defense, home-defense, and others that would just like to learn how to shoot. There will be specific classes geared towards only women, making sure that the women feel comfortable and understood. This will aide in the attraction of this rapidly growing sector of the market. On the following Friday, Saturday, and Sunday, there will be open shooting. The ammunition will be sold at wholesale price and rental guns will be available to freely use as well. These tactics will help get the name of Illiniwek Unlimited Shooting out in the market and hopefully establish some initial members since the costs will be discounted if shooters come during the grand opening week. Illiniwek Unlimited Shooting will also go to big sporting goods franchises like Gander Mountain, Cabela s, Scheels, and so on and offer free range time on certain dates for people who purchase guns at these stores. This will ensure that Illiniwek is getting the business of responsible and licensed individuals who are interested in shooting, all the while getting the name of Illiniwek Unlimited Shooting out there. 39

40 One of the best ways to get people to come to Illiniwek s ranges will be to hold annual shoots. Each range will hold three shoots one for rifle, one for handgun, and one for shotgun. A shoot is simply a tournament held at a range that anyone can register for as long as they are licensed gun owners. At these shoots, vendors will be permitted to come to the grounds and set up booths to sell their products by renting out spaces. This will help promote and grow the name and reputation of Illiniwek Unlimited Shooting, and not to mention bring in a large amount of revenue. In addition to the shoots, Illiniwek Unlimited Shooting will host fundraisers for organizations like the Wounded Warrior Foundation and other military veteran charity groups. There will also be special events for members such as political speakers, silent auctions, and so on. Illiniwek will work hand-in-hand with shooting organizations such as the NSSF and the NRA. By working with the military veterans and openly showing our supports of the NRA and second amendment rights, we will create an aura of patriotism and attract more potential members. All of these promotional techniques, combined with advertising in gun magazines such as the The Rifleman, Gun Digest, and other shooting magazines that are popular throughout Illinois and the surrounding states, will help grow Illiniwek Unlimited Shooting. This will be essential for when we hold our tournaments, for the more people that come, the more vendors that come, and the more money we receive. 40

41 Management Supervisor Manager Staff There are three levels of employment that play a role in the daily operations at Illiniwek Unlimited Shooting the Supervisor, the Manager, and the Staff member. The Supervisor watches over the three buildings, making sure that they are all running efficiently and producing profit. The Supervisor decides on the changes to be made in order to increase profit and improve customer satisfaction. The Supervisor deals with major safety and insurance concerns. The Supervisor also hires the Managers for the three locations and makes sure the Managers stay on task. The Supervisor keeps track of the combined financials for all three locations. There is only one Supervisor who works from 9:00 a.m. to 5:00 p.m. for 5 days of the week. The Manager watches over one of the three buildings, making sure that their building is running efficiently according to the Supervisor's standards. The managers are responsible for the financials of each establishment. They are also in charge of ordering and restocking inventory. Managers hire staff and are in charge of scheduling their work hours. Managers must supervise the staff, making sure that they always are on task and keeping up with safety regulations for the 41

42 business. There are two Managers per location. One Manager should always be present from 9:00 a.m. to 5:00 p.m. every day that the business is open. The Staff watches over customers in order to ensure that the customers are happy and following safety regulations. Staff provides gun-cleaning services. They, also, sell the gun cleaning supplies and ammunition offered. Staff is in charge of keeping the building clean and sanitary. They are also the ones who provide the shooting lessons to the customer. Staff members set up for events and answer the phone. There should always be three staff members present no matter what time of day as long as the building is open. Each building would have thirteen staff members. Employee Yearly Income Supervisor $23, 712 Manager $22,724 Staff $19,760 Supervisors have the benefits of never having to work weekends. The Supervisor s salary is 20% more than a Staff member s yearly earnings. Managers can work less than 40 hours per week and still make a salary that is 15% more than a Staff member s yearly earnings. Staff members are paid $9.50 an hour. They are paid more than minimum wage because they need to be specialized in the handling, cleaning, and shooting of guns. They, also, need to be able to train others how to shoot. By paying more than minimum wage, Illiniwek Shooting Unlimited hopes to obtain people with the skill sets needed to successfully run the business. 42

43 Start-up Costs Approximately $221,250 is required for Illiniwek Unlimited Shooting to commence operations. Due to noise and safety, the range will be located in an open area out in the country that is still easily accessible by the surrounding population. Besides the actual range, an actual 43

44 building is required to house any members coming in, rentals, ammo, bathrooms, etc. To make expenses more efficient in the long run, the building will be purchased for an amount of $57,600 and the range will be on 4.39 acres of land equaling $43,898 for the land. Miscellaneous equipment is a total of $32,400, gun costs are $21,219, gun cleaning supplies are a total of $861, clay pigeons are a total of $430, ammunition is a total of $13,028.60, and organizational costs a total of $51,

45 Capitalization To get Illiniwek Unlimited Shooting up and running, $230,458 will be necessary for start-up costs, cash reserves, and other expenses. The money will be acquired through a $179,437 loan and $51,022 raised through private equity contributions. The loan will be paid off within 20 years with a 6% interest rate. By doing so, Illiniwek Unlimited Shooting would initiate with a capital of $10,000. The fixed assets consist of equipment, furniture, fixtures, building, and land resulting in $155,117. Organizational costs are another $51,022 added on resulting in the $230,

46 Income Statement In Illiniwek Unlimited Shooting s first year of business the net income is $223,666. Net income is calculated once gross profit and expenses are incorporated. The gross profit total for Illiniwek Unlimited Shooting is $608,253. This amount is derived through memberships, lane use, gun rentals, lessons, sales, and cost of goods sold. Expenses are a total of $384,587 and incorporate salaries, wages, taxes, utilities, accounting fees, interest, depreciation, organizational costs, and advertisement. Lessons bring in approximately 39.89% of the total gross profit with an amount of $242,667. Therefore, if lessons were to decrease there would be some trouble keeping a positive net income. However, as long as memberships give their predicted results of 44 a month, the only negative income to be found would be during the winter months. The amount of cash Illiniwek Unlimited Shooting has on hand covers the loss of income during the winter months so that there is still a positive cash flow and net income by the end of the year. To prevent a negative income at all, the shooting range only needs one lesson a month or one extra membership. Sales only makes up a mere 2.9% of gross profit, meaning if the business were unable to sell anything at all, it would still be financially stable as long as other profits were still made. Within expenses, the largest expense is the wages to employees, not including salaries. Due to the total expense for employee wages, caution must be taken to assure only the necessary employees are hired, particularly during slow seasons and such. That is why Illiniwek Unlimited Shooting will have as little amount of employees working at a time as possible, but still enough to make sure the business runs well. 46

47 The building that will be used by Illiniwek Unlimited Shooting will be bought and the cost is $57,600 estimating that each square foot costs $12. The reason Illiniwek Unlimited Shooting is buying instead of renting is because the total cost for the building will be cheaper in the long run compared to having to pay rent each month. Hence, allowing a depreciation rate of 10% for the building over the course of 27.5 years. 47

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49 Cash Flow At the end of the year, Illiniwek Unlimited Shooting is left with an ending cash amount of $243,059. Having that beginning cash of $10,000 on the side aids the business if there were to be any months where sales weren t as high as expected and there were no other way to cover the expenses for the month. By no means is it enough to cover a full month s loss, but with at least membership fees, the business is bound to at least break if worse came to worse. Besides that, since depreciation costs for equipment and building are not capital losses, the business saves approximately $927 per month in cash. 49

50 Ending Balance Sheet Illiniwek Unlimited Shooting depicts a financially secure future. Compared to the beginning balance sheet, the cash reserve grew greatly. In the beginning balance sheet there was a cash reserve of $10,000 and it grew to $257,378. To keep it simple, income distributed to pay personal tax expenses is included under retained earnings. The asset utilization ration of 1.39 signifies a return of $1.39 for every $1.00 of assets. 50

51 Exit Strategy The owners of Illiniwek plan to begin preparations for exiting the business in the fifth year. Shares will be put on the market to the public. By this time, the business will have established a steady base of members, therefore being an attractive offer. Once 45% of the shares have been sold, the owners will then sell the rest of their holdings for what they are worth in the tenth year. The investors will sell the remaining shares on the following terms: The owners will share the losses or profits equally The owners will have a stake in 5% of the business for the following 10 years If the owners are unable to find a buyer, or the potential buyers offers are not satisfactory, the stock will be opened to the public These steps will insure that the owners make a profit on the selling of the business or at least that there will be some income to help cover the rest of the loan payments. This is because more people equal more money. Although, with the steady increase in the industry there seems to be a small chance that the business will have to be sold at a loss. With the market growing in the female and self-defense sectors, the range will be seen as a good investment for someone wanting to take advantage of an ever growing market. The market will only increase as the concealed carry law is passed in Illinois. 51