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 $161,360.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$23,369||$35,054||$46,739||$48,735||$50,816|
|Net Cash Flow||-$45,122||$23,369||$35,054||$46,739||$48,735||$203,265|
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 Cedar Rapids.
- median income
- July temperature
- August temperature
- gross rent
- population density
- land area
- house price
- business activity
- nearby population
Accounting firms or individuals that provide accounting, tax filing, or related financial services to clients.
1420 1st Ave NE Ste 102 Cedar Rapids, IA 52402
629 1st Ave SW Cedar Rapids, IA 52405
4854 1st Ave NE Cedar Rapids, IA 52402
TIP: Your market is dominated by national chains. Consider entering the market with an independant business or a regional franchise.
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About Cedar Rapids and its Consumers
Cedar Rapids is the second largest city in Iowa and is the county seat of Linn County. The city lies on both banks of the Cedar River, 20 miles (32 km) north of Iowa City and 100 miles (160 km) east of Des Moines, the state's capital and largest city. Until massive flooding in 2008, the city's government was headquartered in the Veterans Memorial Building, near the Linn County Courthouse and jail on Mays Island in the Cedar River; Cedar Rapids was one of a few cities in the world, along with Paris, France, with governmental offices on a municipal island. A flourishing center for arts and culture in Eastern Iowa, the city is home to the Cedar Rapids Museum of Art, the National Czech & Slovak Museum & Library, the Paramount Theatre, Theatre Cedar Rapids, the African-American Historical Museum and Cultural Center of Iowa, and the Iowa Cultural Corridor Alliance. Cedar Rapids is an economic hub of the state, located in the core of theInterstate 380 Cedar Rapids/Iowa City Technology Corridor of Linn, Benton, Jones, Johnson, and Washington counties. As of the 2010 United States Census, the city population was 126,326.
Cedar Rapids is the second largest city in Iowa and is the county seat of Linn County. The city lies on both banks of the Cedar River, 20 miles (32 km) north of Iowa City and 100 miles (160 km) east of Des Moines, the state's capital and largest city. Until massive flooding in 2008, the city's government was headquartered in the Veterans Memorial Building, near the Linn County Courthouse and...description source
Population Population (2012) 128,119 Population Density 1,809 ppl/sq mi Population Growth Rate 1.4% Median Income $50,528 Median Age 35.2 Unemployment 5.1% Family Household Percent 58.1% Avg. Household Size 2.3 Avg. House Price $135,200 Foreign Born 3.5% Married 33.3% Cost of Living 46.8%
Demographics White 86.0% Hispanic / Latino 3.3% Black / African American 5.4% Asian 2.2% Native American 0.3%
Market & Regulatory Conditions For Iowa
Third parties rate Iowa'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 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 A+ Friendliness of environmental regulations A+ Friendliness of zoning regulations A+ Publicity of training programs A+ Publicity of networking programs C- Current economic health of small business 4th/50 Change in revenue over past 12 months 3th/50 Forecast of small business's future economic health 45th/50Source: Thumbtack.com (2012)
Business Friendliness Overall Business Friendliness 12th/50 Cost of Doing Business 7th/50 Economy 18th/50 Infrastructure 25th/50 Workforce 37th/50 Quality of life 20th/50 Technology and innovation 29th/50 Business friendliness 9th/50 Education 22th/50 Cost of living 12th/50 Access to capital 49th/50Source: CNBC (2014)
Tax Friendliness Iowa Corporate Tax Rate 6.0% Avg Local Corporate Tax Rate in Iowa 0.8% Avg Combined Corporate Tax Rate 6.8% Overall tax friendliness 41th/50 Corporate tax rank 49th/50 Individual income tax rank 32th/50 Sales tax rank 23th/50 Unemployment insurance tax rank 33th/50 Property tax rank 38th/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.