Market Research Report
Based on the parameters below, we project this business would break even in 1.8 years with a net present value of $283,473.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$40,012||$60,018||$80,024||$83,706||$87,556|
|Net Cash Flow||-$71,302||$40,012||$60,018||$80,024||$83,706||$350,224|
Startup costs are estimated as the larger of PYE and median income multiplied by the cost of living in the city. The positive cash flows in years 1 to 5 are estimated from the PYE. The first year is discounted by 50%, the second year is discounted by 75%, the fourth through tenth years are inflated according to a growth rate estimated from the GDP growth rate of the state. The profit margin is defaulted 10%. In year 5 a “terminal value” equal to the year 5 net operating income times three is added. The hurdle rate is defaulted to 15%. All values are net of taxes.
How is this opportunity calculated?
The following ten market factors are the most important determinants used to calculate the need for businesses of this type in Bakersfield.
- median income
- gross rent
- population density
- July temperature
- household size
- land area
- November temperature
- May temperature
- family households
- February temperature
Abrasive blast cleaning businesses can provide a range of services, from surface contaminant removal and cleaning, to the preparation and finishing of many different types of surfaces.
Cen Cal Dustless Blasting
10727 Taft Hwy Bakersfield, CA 93311
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About Bakersfield and its Consumers
Bakersfield lies near the southern "horseshoe" end of the San Joaquin Valley, with the southern tip of the Sierra Nevada just to the east. The city limits extend to the Sequoia National Forest, at the foot of the Greenhorn Mountain Range and at the entrance to the Kern Canyon. To the south, the Tehachapi Mountains feature the historic Tejon Ranch. To the west is the Temblor Range, behind which is the Carrizo Plain National Monument and the San Andreas Fault. The Temblor Range is about 35 mi (56 km) from Bakersfield across the valley floor. Bakersfields historic and primary industries have related to Kern Countys two main industries, oil and agriculture. Kern County is the most oil productive county in America, with around 10% of the nations domestic production. Kern County is a part of the highly productive San Joaquin Valley, and ranks in the top five most productive agricultural counties in the nation. Major crops for Kern County include: grapes, citrus, almonds, carrots, alfalfa, cotton, and roses. The city serves as the home for both corporate and regional headquarters of companies engaged in these industries.
Bakersfield lies near the southern "horseshoe" end of the San Joaquin Valley, with the southern tip of the Sierra Nevada just to the east. The city limits extend to the Sequoia National Forest, at the foot of the Greenhorn Mountain Range and at the entrance to the Kern Canyon. To the south, the Tehachapi Mountains feature the historic Tejon Ranch. To the west is the Temblor Range, behind which...description source
Population Population (2012) 358,597 Population Density 2,522 ppl/sq mi Population Growth Rate 3.2% Median Income $51,667 Median Age 30.2 Unemployment 9.2% Family Household Percent 74.8% Avg. Household Size 3.1 Avg. House Price $170,400 Foreign Born 18.7% Married 46.5% Cost of Living 46.7%
Demographics White 36.3% Hispanic / Latino 46.1% Black / African American 7.9% Asian 6.8% Native American 0.6%
Market & Regulatory Conditions For California
Third parties rate California's business and regulatory conditions according to their own methods. We report them here for informational purposes.
Small-Business Friendliness Overall small business friendliness F Ease of starting a small business D Cost of hiring a new employee C- Overall regulatory friendliness F Friendliness of health and safety regulations F Friendliness of employment, labor, and hiring regulations F Friendliness of tax code F Friendliness of licensing regulations F Friendliness of environmental regulations D Friendliness of zoning regulations D Publicity of training programs C- Publicity of networking programs D+ Current economic health of small business 40th/50 Change in revenue over past 12 months 40th/50 Forecast of small business's future economic health 35th/50Source: Thumbtack.com (2012)
Business Friendliness Overall Business Friendliness 32th/50 Cost of Doing Business 48th/50 Economy 9th/50 Infrastructure 24th/50 Workforce 36th/50 Quality of life 23th/50 Technology and innovation 1th/50 Business friendliness 48th/50 Education 26th/50 Cost of living 47th/50 Access to capital 1th/50Source: CNBC (2014)
Tax Friendliness California Corporate Tax Rate 7.5% Avg Local Corporate Tax Rate in California 0.9% Avg Combined Corporate Tax Rate 8.4% Overall tax friendliness 48th/50 Corporate tax rank 34th/50 Individual income tax rank 50th/50 Sales tax rank 42th/50 Unemployment insurance tax rank 14th/50 Property tax rank 14th/50Source: Tax Foundation (2015)
Resources to Get Started
Now that you have a potential location and idea for your business, here is a list of helpful resources you may need to get started.