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 $278,585.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$39,534||$59,301||$79,068||$82,789||$86,685|
|Net Cash Flow||-$72,347||$39,534||$59,301||$79,068||$82,789||$346,740|
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 Mesa.
- median income
- gross rent
- population density
- land area
- July temperature
- household size
- November temperature
- family households
- May temperature
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P.O.Box 26254 Scottsdale, AZ 85255
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About Mesa and its Consumers
Mesa is a city in Maricopa County, in the State of Arizona and is a suburb located about 20 miles (32 km) east ofPhoenix. Mesa is the central city of the East Valley section of the Phoenix Metropolitan Area. It is bordered by Tempe on the west, the Salt River Pima-Maricopa Indian Community on the north, Chandler and Gilbert on the south, and Apache Junction on the east. As of the 2010 Census Mesa became Arizona's center of population. Mesa is the third-largest city in Arizona, after Phoenix and Tucson. and the 38th-largest city in the US. The city is home to 439,041 people as of 2010 according to the Census Bureau, meaning it is more populous than more recognizable cities such asTampa, Miami, Minneapolis, New Orleans, Cincinnati, Pittsburgh, St. Louis, Tulsa, Wichita, and Cleveland.Mesa is home to numerous higher education facilities including Polytechnic campus of Arizona State University. Mesa has over 2,280 acres of parkland in the city limits. Mesa's largest park is Red Mountain Park which spans 1,146 acres. It includes a lake, playgrounds, a basketball court and a cement volleyball court.
Mesa is a city in Maricopa County, in the State of Arizona and is a suburb located about 20 miles (32 km) east ofPhoenix. Mesa is the central city of the East Valley section of the Phoenix Metropolitan Area. It is bordered by Tempe on the west, the Salt River Pima-Maricopa Indian Community on the north, Chandler and Gilbert on the south, and Apache Junction on the east. As of the 2010 Census...description source
Population Population (2012) 452,084 Population Density 3,313 ppl/sq mi Population Growth Rate 3.0% Median Income $44,527 Median Age 35.3 Unemployment 6.7% Family Household Percent 65.8% Avg. Household Size 2.6 Avg. House Price $136,200 Foreign Born 14.8% Married 30.8% Cost of Living 48.0%
Demographics White 63.8% Hispanic / Latino 25.8% Black / African American 4.7% Asian 1.7% Native American 1.8%
Market & Regulatory Conditions For Arizona
Third parties rate Arizona'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 B- Cost of hiring a new employee B- Overall regulatory friendliness C+ Friendliness of health and safety regulations B- Friendliness of employment, labor, and hiring regulations B Friendliness of tax code C+ Friendliness of licensing regulations C Friendliness of environmental regulations C+ Friendliness of zoning regulations C Publicity of training programs D Publicity of networking programs B+ Current economic health of small business 22th/50 Change in revenue over past 12 months 20th/50 Forecast of small business's future economic health 26th/50Source: Thumbtack.com (2012)
Business Friendliness Overall Business Friendliness 13th/50 Cost of Doing Business 28th/50 Economy 15th/50 Infrastructure 8th/50 Workforce 2th/50 Quality of life 27th/50 Technology and innovation 19th/50 Business friendliness 16th/50 Education 50th/50 Cost of living 27th/50 Access to capital 5th/50Source: CNBC (2014)
Tax Friendliness Arizona Corporate Tax Rate 5.6% Avg Local Corporate Tax Rate in Arizona 2.6% Avg Combined Corporate Tax Rate 8.2% Overall tax friendliness 23th/50 Corporate tax rank 24th/50 Individual income tax rank 19th/50 Sales tax rank 49th/50 Unemployment insurance tax rank 4th/50 Property tax rank 6th/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.