Market Research Report
Based on the parameters below, we project this business would break even in 1.9 years with a net present value of $297,837.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$41,798||$62,697||$83,596||$88,626||$93,960|
|Net Cash Flow||-$78,413||$41,798||$62,697||$83,596||$88,626||$375,838|
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 Mesquite.
- median income
- gross rent
- population density
- July temperature
- household size
- November temperature
- May temperature
- land area
- family households
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About Mesquite and its Consumers
Mesquite is a city and an eastern suburb of Dallas, Texas. Most of the city is located in Dallas County with a smaller portion in the east overlapping into Kaufman County. As of the 2010 census, the population was 139,824 making it the eighteenth most populous city in the state of Texas. According to the United States Census Bureau, the city has a total area of 46.2 square miles (119.6 km2), of which 46.0 square miles (119.2 km2) is land and 0.15 square miles (0.4 km2), or 0.33%, is water. On average, the warmest month is July. The highest recorded temperature was 112°F in 1980. The average coolest month is January. The lowest recorded temperature was 1°F in 1989. The City Council consists of six councilmembers. Councilmembers serve two-year terms and are responsible for appointing the city health officer, independent auditor, municipal judge, city manager, city attorney, city secretary and members of various boards and commissions. The mayor and six councilmembers are elected at large; however, four council positions have residency requirements.
Mesquite is a city and an eastern suburb of Dallas, Texas. Most of the city is located in Dallas County with a smaller portion in the east overlapping into Kaufman County. As of the 2010 census, the population was 139,824 making it the eighteenth most populous city in the state of Texas. According to the United States Census Bureau, the city has a total area of 46.2 square miles (119.6 km2),...description source
Population Population (2012) 143,195 Population Density 3,111 ppl/sq mi Population Growth Rate 2.4% Median Income $46,983 Median Age 31.9 Unemployment 6.6% Family Household Percent 73.2% Avg. Household Size 2.9 Avg. House Price $106,900 Foreign Born 14.4% Married 33.9% Cost of Living 49.2%
Demographics White 39.9% Hispanic / Latino 29.9% Black / African American 25.1% Asian 4.0% Native American 0.1%
Market & Regulatory Conditions For Texas
Third parties rate Texas's business and regulatory conditions according to their own methods. We report them here for informational purposes.
Small-Business Friendliness Overall small business friendliness A+ Ease of starting a small business A Cost of hiring a new employee B+ Overall regulatory friendliness A Friendliness of health and safety regulations A- Friendliness of employment, labor, and hiring regulations A Friendliness of tax code A Friendliness of licensing regulations A 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 13th/50 Change in revenue over past 12 months 29th/50 Forecast of small business's future economic health 17th/50Source: Thumbtack.com (2012)
Business Friendliness Overall Business Friendliness 2th/50 Cost of Doing Business 23th/50 Economy 1th/50 Infrastructure 1th/50 Workforce 11th/50 Quality of life 37th/50 Technology and innovation 2th/50 Business friendliness 20th/50 Education 27th/50 Cost of living 18th/50 Access to capital 5th/50Source: CNBC (2014)
Tax Friendliness Texas Corporate Tax Rate 6.3% Avg Local Corporate Tax Rate in Texas 1.9% Avg Combined Corporate Tax Rate 8.2% Overall tax friendliness 10th/50 Corporate tax rank 39th/50 Individual income tax rank 6th/50 Sales tax rank 36th/50 Unemployment insurance tax rank 15th/50 Property tax rank 36th/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.