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 $179,255.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$25,584||$38,375||$51,167||$53,521||$55,983|
|Net Cash Flow||-$47,585||$25,584||$38,375||$51,167||$53,521||$223,931|
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 Fresno.
- July temperature
- median income
- August temperature
- gross rent
- population density
- land area
- house price
- business activity
- February temperature
- nearby population
Accounting firms or individuals that provide accounting, tax filing, or related financial services to clients.
DeMera DeMera Cameron LLP Certified Public Accountants
5080 N Fruit Ave Fresno, CA 93711
2585 E Perrin Ave Ste 112 Fresno, CA 93720
Ryan Christie Quinn & Horn
676 W Locust Ave Fresno, CA 93650
Tamiyasu Smith Horn & Braun
1991 N Gateway Blvd Fresno, CA 93727
Dritsas Groom McCormick LLP Certified Public Accountants
7576 N Ingram Ave Fresno, CA 93711
TIP: Your market is dominated by independant companies. Consider entering with a national or regional franchise.
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About Fresno and its Consumers
Fresno is located in central California, 184 mi southeast of San Francisco and 222 mi northwest of Los Angeles. It is the seat of Fresno County. Fresno was incorporated as a city in 1885. Fresno began as a station for the Central Pacific Railroad in 1872 and was made the seat of Fresno County in 1874. The city's name is Spanish for the ash trees that the early explorers found in the area. Fresno serves as the economic hub of Fresno County and California's San Joaquin Valley. Fresno is a leading agribusiness hub, with 250 different crops produced by 7,500 farmers on 1.9 million irrigated acres, worth $3 billion a year. Fresno County's top agricultural products are grapes, cotton, tomatoes, cattle and calves, and turkeys. The city is also a distribution and manufacturing center. Its diverse industries include agricultural chemicals, farm equipment, canned fruit and vegetables, clothing, computer software, electric wire, pumps, glass, and plastic products.
Fresno is located in central California, 184 mi southeast of San Francisco and 222 mi northwest of Los Angeles. It is the seat of Fresno County. Fresno was incorporated as a city in 1885. Fresno began as a station for the Central Pacific Railroad in 1872 and was made the seat of Fresno County in 1874. The city's name is Spanish for the ash trees that the early explorers found in the...description source
Population Population (2012) 505,882 Population Density 4,518 ppl/sq mi Population Growth Rate 2.3% Median Income $40,533 Median Age 29.4 Unemployment 11.7% Family Household Percent 70.4% Avg. Household Size 3.1 Avg. House Price $172,600 Foreign Born 19.5% Married 39.6% Cost of Living 48.8%
Demographics White 28.9% Hispanic / Latino 48.7% Black / African American 6.7% Asian 12.4% Native American 0.4%
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.