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 $225,498.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$32,117||$48,176||$64,235||$66,770||$69,406|
|Net Cash Flow||-$57,298||$32,117||$48,176||$64,235||$66,770||$277,623|
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 Columbia.
- median income
- gross rent
- population density
- July temperature
- land area
- November temperature
- May temperature
- household size
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About Columbia and its Consumers
Columbia, known by its inhabitants as "Famously Hot", is the state capital and largest city in the State of South Carolina. The population was 129,272 according to the 2010 census.The 2013 United States Census estimates put the city at 133,358.Columbia is the county seat of Richland County, but a portion of the city extends into neighboring Lexington County. The city is the center of a metropolitan statistical area of 793,779, the second-largest within the state. The name "Columbia" was a poetic term for the Americas derived from Christopher Columbus. Located 13 miles (21 km) northwest of South Carolina's geographic center, Columbia is the primary city of the Midlands region of South Carolina, which comprises several counties in the central portion of the state. The city lies at the confluence of two rivers, the Saluda and the Broad, which merge at Columbia to form the Congaree River, which is popular with paddlers and kayakers in the area. The state's flagship and largest university, the University of South Carolina, is located in Columbia.
Columbia, known by its inhabitants as "Famously Hot", is the state capital and largest city in the State of South Carolina. The population was 129,272 according to the 2010 census.The 2013 United States Census estimates put the city at 133,358.Columbia is the county seat of Richland County, but a portion of the city extends into neighboring Lexington County. The city is the center of a...description source
Population Population (2012) 131,686 Population Density 996 ppl/sq mi Population Growth Rate 1.9% Median Income $39,220 Median Age 28.5 Unemployment 9.2% Family Household Percent 49.6% Avg. Household Size 2.2 Avg. House Price $159,300 Foreign Born 5.0% Married 52.4% Cost of Living 46.8%
Demographics White 49.6% Hispanic / Latino 4.3% Black / African American 41.7% Asian 2.2% Native American 0.3%
Market & Regulatory Conditions For South Carolina
Third parties rate South Carolina's business and regulatory conditions according to their own methods. We report them here for informational purposes.
Small-Business Friendliness Overall small business friendliness B+ Ease of starting a small business A- Cost of hiring a new employee A+ Overall regulatory friendliness A Friendliness of health and safety regulations A+ Friendliness of employment, labor, and hiring regulations A Friendliness of tax code B Friendliness of licensing regulations B+ Friendliness of environmental regulations A+ Friendliness of zoning regulations A- Publicity of training programs C+ Publicity of networking programs C+ Current economic health of small business 7th/50 Change in revenue over past 12 months 19th/50 Forecast of small business's future economic health 31th/50Source: Thumbtack.com (2012)
Business Friendliness Overall Business Friendliness 24th/50 Cost of Doing Business 9th/50 Economy 13th/50 Infrastructure 14th/50 Workforce 25th/50 Quality of life 40th/50 Technology and innovation 30th/50 Business friendliness 34th/50 Education 43th/50 Cost of living 10th/50 Access to capital 41th/50Source: CNBC (2014)
Tax Friendliness South Carolina Corporate Tax Rate 6.0% Avg Local Corporate Tax Rate in South Carolina 1.2% Avg Combined Corporate Tax Rate 7.2% Overall tax friendliness 37th/50 Corporate tax rank 13th/50 Individual income tax rank 41th/50 Sales tax rank 18th/50 Unemployment insurance tax rank 40th/50 Property tax rank 21th/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.