Market Research Report
Based on the parameters below, we project this business would break even in 2.6 years with a net present value of $262,464.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$41,617||$62,425||$83,234||$87,062||$91,067|
|Net Cash Flow||-$106,539||$41,617||$62,425||$83,234||$87,062||$364,269|
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 Escondido.
- median income
- gross rent
- population density
- household size
- July temperature
- November temperature
- land area
- May temperature
- family households
- February temperature
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About Escondido and its Consumers
Escondido is a city in California's North County region, occupying a shallow valley ringed by rocky hills, just north of the city of San Diego and 30 miles from Downtown San Diego. Founded in 1888, it is one of the oldest cities in San Diego County. The city had a population of 143,911 at the 2010 census. Its municipal government set itself an operating budget limit of $426,289,048 for the fiscal year 2010-2011. The city is known as Eskondiid in Diegueño. Residents work in a range of industries. Out of the approximately 64,000 employed civilian residents over the age of 16, 15% work in educational, health care and social services; 13% in retail trade; 13% in construction; 12% in professional, scientific, management, administrative, and waste management services; 11% in arts, entertainment, recreation, and accommodation and food services; 11% in manufacturing; and 11% in other services. Realty Income is among the companies based in Escondido.
Escondido is a city in California's North County region, occupying a shallow valley ringed by rocky hills, just north of the city of San Diego and 30 miles from Downtown San Diego. Founded in 1888, it is one of the oldest cities in San Diego County. The city had a population of 143,911 at the 2010 census. Its municipal government set itself an operating budget limit of $426,289,048 for the...description source
Population Population (2012) 147,575 Population Density 4,008 ppl/sq mi Population Growth Rate 2.5% Median Income $43,661 Median Age 32.5 Unemployment 8.1% Family Household Percent 72.0% Avg. Household Size 3.1 Avg. House Price $318,600 Foreign Born 27.4% Married 33.3% Cost of Living 67.1%
Demographics White 39.6% Hispanic / Latino 50.5% Black / African American 2.0% Asian 6.1% Native American 0.2%
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.