Market Research Report
Based on the parameters below, we project this business would break even in 3.1 years with a net present value of $212,290.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$36,649||$54,973||$73,297||$76,962||$80,810|
|Net Cash Flow||-$114,050||$36,649||$54,973||$73,297||$76,962||$323,240|
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 Honolulu.
- median income
- July temperature
- August temperature
- gross rent
- February temperature
- population density
- house price
- December temperature
- business activity
- land area
Accounting firms or individuals that provide accounting, tax filing, or related financial services to clients.
James D Jennings CPA Inc
1600 Kapiolani Blvd Suite 1311 Honolulu, HI 96814
Vyas Patrick CPA Inc
1277 S Beretania St 2nd Flr Honolulu, HI 96814
Tomishima & Fukuhara CPA Inc
1520 Liliha St Suite 705 Honolulu, HI 96817
N&K CPAs Inc
1001 Bishop St Suite 1700 Honolulu, HI 96813
Davey Allen N LLC
1001 Bishop St Suite 1345 Honolulu, HI 96813
TIP: Your market is dominated by independant companies. Consider entering with a national or regional franchise.
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About Honolulu and its Consumers
Honolulu is the capital and largest city of Hawaii, on the southeast coast of the island of Oahu. The city is legally coextensive with the county of Honolulu, which includes the entire island of Oahu and most of the Northwest Hawaiian Islands, from Nihoa to Kure Atoll, except Midway. The population of Oahu makes up 73% of the state's total population. It is situated in the central Pacific Ocean 2,397 mi west-southwest of San Francisco. Honolulu's name derives from the native words hono, meaning a bay, and lulu, meaning sheltered. Honolulu's early history was one of turbulence and conflict. One of the last areas on the globe to be explored and exploited by Europeans (it was first visited by British captain James Cook in 1778), Hawaii was subject to strong pressures from many forces, including American missionaries, who arrived in 1820, and opportunistic whalers. These whalers were among those who built Honolulu originally, bringing trade, commerce, and prosperity that led to expansion into the sugar and pineapple industries.
Honolulu is the capital and largest city of Hawaii, on the southeast coast of the island of Oahu. The city is legally coextensive with the county of Honolulu, which includes the entire island of Oahu and most of the Northwest Hawaiian Islands, from Nihoa to Kure Atoll, except Midway. The population of Oahu makes up 73% of the state's total population. It is situated in the central Pacific Ocean...description source
Population Population (2012) 345,610 Population Density 5,710 ppl/sq mi Population Growth Rate 2.5% Median Income $57,479 Median Age 39.7 Unemployment 3.6% Family Household Percent 62.3% Avg. Household Size 2.0 Avg. House Price $628,938 Foreign Born 17.9% Married 45.9% Cost of Living 81.6%
Demographics White 21.0% Hispanic / Latino 5.9% Black / African American 2.0% Asian 50.1% Native American 0.03%
Market & Regulatory Conditions For Hawai'i
Third parties rate Hawai'i'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 F Cost of hiring a new employee F Overall regulatory friendliness F Friendliness of health and safety regulations F Friendliness of employment, labor, and hiring regulations D Friendliness of tax code D Friendliness of licensing regulations D Friendliness of environmental regulations F Friendliness of zoning regulations F Publicity of training programs D Publicity of networking programs B- Current economic health of small business 20th/50 Change in revenue over past 12 months 45th/50 Forecast of small business's future economic health 19th/50Source: Thumbtack.com (2012)
Business Friendliness Overall Business Friendliness 49th/50 Cost of Doing Business 49th/50 Economy 34th/50 Infrastructure 43th/50 Workforce 49th/50 Quality of life 1th/50 Technology and innovation 33th/50 Business friendliness 44th/50 Education 42th/50 Cost of living 49th/50 Access to capital 33th/50Source: CNBC (2014)
Tax Friendliness Hawai'i Corporate Tax Rate 4.0% Avg Local Corporate Tax Rate in Hawai'i 0.4% Avg Combined Corporate Tax Rate 4.4% Overall tax friendliness 30th/50 Corporate tax rank 9th/50 Individual income tax rank 37th/50 Sales tax rank 15th/50 Unemployment insurance tax rank 28th/50 Property tax rank 12th/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.