Market Research Report
Based on the parameters below, we project this business would break even in 2.5 years with a net present value of $181,562.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$28,548||$42,822||$57,096||$59,723||$62,470|
|Net Cash Flow||-$71,565||$28,548||$42,822||$57,096||$59,723||$249,880|
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 Elk Grove.
- median income
- July temperature
- August temperature
- gross rent
- population density
- house price
- business activity
- February temperature
- land area
- nearby population
Accounting firms or individuals that provide accounting, tax filing, or related financial services to clients.
4720 Laguna Blvd Ste 40 Elk Grove, CA 95758
8139 Elk Grove Blvd Ste 110 Elk Grove, CA 95758
8645 Elk Grove Blvd Elk Grove, CA 95624
Stroub Thompson Noble - CPA's
1555 River Park Dr Suite 201 Sacramento, CA 95815
2201 Francisco Dr Ste 140-334 El Dorado Hills, CA 95762
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 Elk Grove and its Consumers
The California city of Elk Grove is located in Sacramento County, only 15 miles south of the state capital of Sacramento. California State Highway 99 runs through the city, which is also close to Interstate I-5. The Sacramento International Airport, less than a 30-minute drive away, provides carrier service via major airlines and rail transportation is also available in Sacramento. Founded in 1850 as a stage and hotel stop, Elk Grove soon became a hub for local commerce largely due to its proximity to historic Sutter's Fort. Evolving with a growth pattern distinct from that of its northern neighbor Sacramento, the city quietly expanded outward into adjoining countrywide areas until the late 20th century. Reliant on agriculture throughout most of its history, Elk Grove today retains its farms, vineyards, and livestock industries; but has more recently supplemented these with a burgeoning prominence of high-tech, professional service, commercial and retail enterprises.
The California city of Elk Grove is located in Sacramento County, only 15 miles south of the state capital of Sacramento. California State Highway 99 runs through the city, which is also close to Interstate I-5. The Sacramento International Airport, less than a 30-minute drive away, provides carrier service via major airlines and rail transportation is also available in Sacramento. Founded in...description source
Population Population (2012) 159,038 Population Density 3,769 ppl/sq mi Population Growth Rate 3.9% Median Income $73,250 Median Age 33.9 Unemployment 9.2% Family Household Percent 80.5% Avg. Household Size 3.2 Avg. House Price $247,900 Foreign Born 18.1% Married 31.7% Cost of Living 51.2%
Demographics White 41.7% Hispanic / Latino 19.3% Black / African American 9.7% Asian 22.8% 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.