Market Research Report
Based on the parameters below, we project this business would break even in 2.9 years with a net present value of $76,857.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$12,977||$19,465||$25,954||$26,976||$28,040|
|Net Cash Flow||-$37,397||$12,977||$19,465||$25,954||$26,976||$112,158|
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 Montgomery.
- July temperature
- median income
- August temperature
- gross rent
- land area
- population density
- house price
- business activity
- February temperature
Accounting firms or individuals that provide accounting, tax filing, or related financial services to clients.
Bern Butler Capilouto & Massey PC
4137 Carmichael Rd Montgomery, AL 36106
200 Commerce St Montgomery, AL 36104
Livings Lankford Lambert & Company CPA
9541 Wynlakes Pl Montgomery, AL 36117
Aldridge Borden & Co
74 Commerce St Montgomery, AL 36104
Parker Gill Eisen & Stevenson PC
4228 Lomac St Montgomery, AL 36106
TIP: Your market is dominated by independant companies. Consider entering with a national or regional franchise.
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About Montgomery and its Consumers
Montgomery is the capital of the State of Alabama, and is the county seat of Montgomery County. Named for Richard Montgomery, it is located on the Alabama River, in the Gulf Coastal Plain. As of the 2010 Census, Montgomery had a population of 205,764. It is the second-largest city in Alabama, after Birmingham, and the 103rd largest in the United States. The Montgomery Metropolitan Statistical Area had a 2010 estimated population of 374,536. It is the fourth-largest in the state and 136th among United States metropolitan areas. The city was incorporated in 1819, as a merger of two towns situated along the Alabama River. It became the state capital in 1846, representing the shift of power to the south-central area with the growth of cotton as a commodity crop of the Black Belt and Mobile's rise as a mercantile port. In February 1861, Montgomery was selected as the first capital of the Confederate States of America, until the seat of government moved to Richmond, Virginia, in May of that year. During the mid-20th century, Montgomery was a major site of events in the African-American Civil Rights Movement, including the Montgomery Bus Boycott and the Selma to Montgomery marches.
Montgomery is the capital of the State of Alabama, and is the county seat of Montgomery County. Named for Richard Montgomery, it is located on the Alabama River, in the Gulf Coastal Plain. As of the 2010 Census, Montgomery had a population of 205,764. It is the second-largest city in Alabama, after Birmingham, and the 103rd largest in the United States. The Montgomery Metropolitan Statistical...description source
Population Population (2012) 205,293 Population Density 1,286 ppl/sq mi Population Growth Rate -0.2% Median Income $43,233 Median Age 34.0 Unemployment 6.9% Family Household Percent 63.4% Avg. Household Size 2.4 Avg. House Price $116,900 Foreign Born 3.0% Married 37.5% Cost of Living 45.4%
Demographics White 36.1% Hispanic / Latino 3.9% Black / African American 56.4% Asian 2.2% Native American 0.2%
Market & Regulatory Conditions For Alabama
Third parties rate Alabama's business and regulatory conditions according to their own methods. We report them here for informational purposes.
Small-Business Friendliness Overall small business friendliness A- Ease of starting a small business B+ Cost of hiring a new employee C+ Overall regulatory friendliness A Friendliness of health and safety regulations A Friendliness of employment, labor, and hiring regulations B+ Friendliness of tax code A Friendliness of licensing regulations A+ Friendliness of environmental regulations A- Friendliness of zoning regulations A Publicity of training programs A Publicity of networking programs A Current economic health of small business 23thth/50 Change in revenue over past 12 months 5th/50 Forecast of small business's future economic health 10th/50Source: Thumbtack.com (2012)
Business Friendliness Overall Business Friendliness 34th/50 Cost of Doing Business 4th/50 Economy 40th/50 Infrastructure 21th/50 Workforce 20th/50 Quality of life 46th/50 Technology and innovation 31th/50 Business friendliness 38th/50 Education 47th/50 Cost of living 7th/50 Access to capital 45th/50Source: CNBC (2014)
Tax Friendliness Alabama Corporate Tax Rate 4.0% Avg Local Corporate Tax Rate in Alabama 4.5% Avg Combined Corporate Tax Rate 8.5% Overall tax friendliness 28th/50 Corporate tax rank 27th/50 Individual income tax rank 23th/50 Sales tax rank 41th/50 Unemployment insurance tax rank 25th/50 Property tax rank 10th/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.