Market Research Report
Based on the parameters below, we project this business would break even in 1.8 years with a net present value of $219,087.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$31,420||$47,129||$62,839||$64,850||$66,925|
|Net Cash Flow||-$55,361||$31,420||$47,129||$62,839||$64,850||$267,700|
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 Kansas City.
- median income
- July temperature
- August temperature
- gross rent
- land area
- population density
- house price
- business activity
- nearby population
- April temperature
Accounting firms or individuals that provide accounting, tax filing, or related financial services to clients.
4329 NE Chouteau Trfwy Kansas City, MO 64117
314 Armour Rd Kansas City, MO 64116
3849 Main St Kansas City, MO 64111
3133 Prospect Ave Kansas City, MO 64128
Complete Tax Service
1500 NE Parvin Rd Kansas City, MO 64116
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 Kansas City and its Consumers
Kansas City is the largest city in Missouri. It is located in the western part of the state, at the junction of the Missouri and Kansas rivers. Kansas City is located in Jackson, Clay, Platte, and Cass counties. The Kansas City metropolitan area, once known primarily for agriculture and manufacturing, has expanded its economic base to include strong growth in areas of telecommunications, banking and finance, and the service industry. A transportation hub since the 1800s, the area enjoys a national and regional prominence as a distribution and manufacturing center. Kansas City ranks nationally as first in greeting-card publishing (Hallmark Cards is located there), frozen food storage and distribution, and hard winter-wheat marketing; second in wheat flour production; and third in auto and truck assembly. The area is one of ten federal regional centers, and the federal, state, and local governments are among the top employers. The city is also a regional center for health care.
Kansas City is the largest city in Missouri. It is located in the western part of the state, at the junction of the Missouri and Kansas rivers. Kansas City is located in Jackson, Clay, Platte, and Cass counties. The Kansas City metropolitan area, once known primarily for agriculture and manufacturing, has expanded its economic base to include strong growth in areas of telecommunications,...description source
Population Population (2012) 464,310 Population Density 1,474 ppl/sq mi Population Growth Rate 1.0% Median Income $43,810 Median Age 35.0 Unemployment 8.3% Family Household Percent 56.7% Avg. Household Size 2.3 Avg. House Price $133,800 Foreign Born 7.5% Married 38.1% Cost of Living 46.2%
Demographics White 55.8% Hispanic / Latino 10.1% Black / African American 27.6% Asian 2.8% Native American 0.3%
Market & Regulatory Conditions For Missouri
Third parties rate Missouri's business and regulatory conditions according to their own methods. We report them here for informational purposes.
Small-Business Friendliness Overall small business friendliness B- Ease of starting a small business B Cost of hiring a new employee C+ Overall regulatory friendliness C+ Friendliness of health and safety regulations C- Friendliness of employment, labor, and hiring regulations C+ Friendliness of tax code B- Friendliness of licensing regulations C+ Friendliness of environmental regulations C- Friendliness of zoning regulations C- Publicity of training programs C- Publicity of networking programs C- Current economic health of small business 37th/50 Change in revenue over past 12 months 38th/50 Forecast of small business's future economic health 13th/50Source: Thumbtack.com (2012)
Business Friendliness Overall Business Friendliness 23th/50 Cost of Doing Business 11th/50 Economy 15th/50 Infrastructure 13th/50 Workforce 44th/50 Quality of life 48th/50 Technology and innovation 24th/50 Business friendliness 29th/50 Education 20th/50 Cost of living 18th/50 Access to capital 39th/50Source: CNBC (2014)
Tax Friendliness Missouri Corporate Tax Rate 4.2% Avg Local Corporate Tax Rate in Missouri 3.4% Avg Combined Corporate Tax Rate 7.6% Overall tax friendliness 17th/50 Corporate tax rank 4th/50 Individual income tax rank 29th/50 Sales tax rank 29th/50 Unemployment insurance tax rank 12th/50 Property tax rank 7th/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.