Market Research Report
Based on the parameters below, we project this business would break even in 2.2 years with a net present value of $259,999.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$39,287||$58,931||$78,575||$82,083||$85,748|
|Net Cash Flow||-$87,847||$39,287||$58,931||$78,575||$82,083||$342,990|
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 Hollywood.
- median income
- gross rent
- population density
- November temperature
- July temperature
- May temperature
- household size
- February temperature
- land area
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About Hollywood and its Consumers
Hollywood is a city in Broward County, Florida. As of the 2010 U.S. Census, it had a population of 140,768. Founded in 1925, the city grew rapidly in the 1950s and 1960s, and is now the twelfth largest city in Florida. Hollywood is a principal city of theSouth Florida Metropolitan Area, which was home to 5,564,635 people at the 2010 census. According to the United States Census Bureau, the city has a total area of 30.8 square miles (80 km2). 27.34 square miles (71 km2) of it is land and 3.46 square miles (9 km2) of it is water (11.23%). Hollywood is located in southeastern Broward County, and includes about 5 to 6 miles (8.0 to 9.7 km) of Atlantic Ocean beach, interrupted briefly by a portion deeded to Dania Beach. Prior to their dissolutions, Commodore Cruise Line and its subsidiary Crown Cruise Line had their headquarters in Hollywood. HEICO has its headquarters in Hollywood. Since 1991, the Invicta Watch Group, a manufacturer of timepieces and writing instruments, has had its headquarters in Hollywood where it also operates its customer service call center.
Hollywood is a city in Broward County, Florida. As of the 2010 U.S. Census, it had a population of 140,768. Founded in 1925, the city grew rapidly in the 1950s and 1960s, and is now the twelfth largest city in Florida. Hollywood is a principal city of theSouth Florida Metropolitan Area, which was home to 5,564,635 people at the 2010 census. According to the United States Census Bureau, the...description source
Population Population (2012) 145,236 Population Density 5,307 ppl/sq mi Population Growth Rate 3.2% Median Income $42,494 Median Age 41.4 Unemployment 6.4% Family Household Percent 58.9% Avg. Household Size 2.4 Avg. House Price $167,600 Foreign Born 32.0% Married 31.8% Cost of Living 58.6%
Demographics White 44.8% Hispanic / Latino 33.3% Black / African American 17.2% Asian 2.3% Native American 0.1%
Market & Regulatory Conditions For Florida
Third parties rate Florida's business and regulatory conditions according to their own methods. We report them here for informational purposes.
Small-Business Friendliness Overall small business friendliness C Ease of starting a small business C Cost of hiring a new employee C Overall regulatory friendliness B- Friendliness of health and safety regulations C+ Friendliness of employment, labor, and hiring regulations B- Friendliness of tax code B+ Friendliness of licensing regulations C+ Friendliness of environmental regulations C+ Friendliness of zoning regulations C+ Publicity of training programs C Publicity of networking programs C+ Current economic health of small business 34th/50 Change in revenue over past 12 months 35th/50 Forecast of small business's future economic health 23th/50Source: Thumbtack.com (2012)
Business Friendliness Overall Business Friendliness 20th/50 Cost of Doing Business 37th/50 Economy 11th/50 Infrastructure 27th/50 Workforce 3th/50 Quality of life 28th/50 Technology and innovation 12th/50 Business friendliness 35th/50 Education 38th/50 Cost of living 31th/50 Access to capital 7th/50Source: CNBC (2014)
Tax Friendliness Florida Corporate Tax Rate 6.0% Avg Local Corporate Tax Rate in Florida 0.6% Avg Combined Corporate Tax Rate 6.6% Overall tax friendliness 5th/50 Corporate tax rank 14th/50 Individual income tax rank 1th/50 Sales tax rank 12th/50 Unemployment insurance tax rank 3th/50 Property tax rank 16th/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.