Business plan for
Dale Hipps L.M.T.
1126 N Lincoln street
West Point Nebraska
Table of contents:
1. Executive summary
2. General company description
3. Products and services
4. Marketing Plan
5. Operational plan
6. Personal financial statement
7. Start up expenses
8. One year projection
Executive Summary
I propose to open an establishment in West Point, Nebraska offering massage therapy to the citizens of West Point, Lyons, Wisner, Oakland, and the surrounding areas. I plan to start this business in a rented room in the currently established Creekwood Chiropractic Clinic located at 1126 N Lincoln Street. This business will offer various modalities of massage including Swedish massage in a professional manner and environment. It will service those who would benefit from massage in conjunction with chiropractic treatment, as well as those solely seeking the benefits of massage. This can be done with minimal start up costs and a minimal customer base. I hope to commence on this venture shortly after graduation from massage school at the end of April.
General company description
This business will be a place that provides different modalities of massage therapy. My goal is that there will be at least two therapists and at least one female therapist. Modalities beyond Swedish massage will depend on the skill set of the individual therapists. I plan to personally offer Swedish massage one or two days a week, or possibly several partial days per week. I also plan to manage the property. This business is not intended to be my main source of income.
The goal of this business is to serve God, to be His hands meeting the needs of so many to be lovingly touched with all the blessings of massage.
One of the objectives of this business is to strive to have every costumer leave feeling wonderful. It is also an objective to provide a positive fulfilling work environment for therapists and employees. My goals include being self supporting in 3 months, having a client base sufficient to fully support one therapist in one year and to support two therapists in two years.
It is very important that the activities of this company be glorifying to God.
My initial market will be those interested in massage as a means of relaxation and preventative health care. Although I will provide massage to those who need it for purposes of healing, this will not be the main focus. There is an ever expanding base of people seeking alternative means of preventative and alternative health care. The pace of our society is a natural cauldron for breeding stress. Massage is a natural antidote. All massages are not equal. As massage mills continue to expand, this business will flourish by focusing on massage quality, attention to detail, and excellent customer rapport.
I hope to commence business as a sole proprietorship and also as the sole therapist for ease of start up, but will plan to look at becoming a LLC in a year or so.
Products and services
Initially this business will offer Swedish massage. Depending on modalities that might be made an option by other therapists, other types of treatments might be offered as well. Hot stone treatments and various other forms of hydrotherapy may be added depending also on the facility acquired. I will not offer energy treatments.
I would like to experiment with 1 hour and 45 min, and 2 hour time slots for 1 hour treatments. The fee for a one hour massage will be $65.00 and for a .5 hour treatment, $37.50. Fees for other treatments will be assessed as more experience is acquired.
I would like to add in the future a line of massage creams and oils, but this will not be part of the initial start up.
Marketing plan
West Point Nebraska has a population of 3,660 according to the 2004 census. Cumming County has a population of 9,786. Only about 2500 of Burt County’s population would be inclined to use services in West Point, including the populations of Lyons and Oakland. This would leave a rough estimate of 7500 people that would regularly seek services in West Point.
Spa Capsule reports that in the last 12 months 24% of Americans sought a massage.
According to the AMTA http://www.amtamassage.org/articles/3/MTJ/detail/1837
“Consumer use of massage is expected to stay the same or grow slightly next year, with 26 percent of consumer respondents expecting to get a massage next year as compared to 23 percent reported last year.
Additionally, more women expect to receive massage next year, up to 33 percent, while men’s use of massage therapy may hold steady at 18 percent. The expected use of massage therapy for younger consumers, those 18 to 34 years old, dropped considerably—from 58 percent last year to 35 percent in 2009.
However, more consumers in non-metro areas plan on getting a massage next year, up from 12 percent in 2008 to 26 percent in 2009.”
Using an average figure of 25% of the population seeking to receive a massage, 1875 people will seek a massage in West point at least once this next year. This translates into 37.5 massages per week for 50 weeks if nobody received more than one massage this next year. This market would need to be shared with the existing massage therapist in West Point that currently gives 15 massages per week.
I currently have been offered a room for massage in an existing chiropractic office. The rent for this room has been set for $200.00 per month. This includes all utilities and the services of the receptionist. This is an ideal start-up situation with very low overhead.
The current massage therapist has a client base of about 100 people, 90% women between the ages of 40 and 65. I would like to reach a broader age and gender spectrum. I think men would be more likely to seek massage if its benefits can be quantified. For example if it can be shown that a $65.00 monthly investment in massage will yield overall lower yearly health care costs, this will have appeal to men. I hope to develop brochures and other forms of advertising to appeal to the male population on this basis. I think the younger population has less expendable income, but more stress. The value of massage will need to be quantified for them also, but with more emphasis on the improved quality of life with less stress. I intend to also appeal to those in the upper class with more expendable income on the basis of pampering oneself with massage.
I have approached both chiropractors in West Point, and both are interested in reciprocating referrals. However based on the experience of the current massage therapist, I expect this will be less than 10 % of my client base.
I believe that a person who receives a massage will likely be a return customer. Strategies to procure the opportunity to give that first massage will include, but not be limited to half hour upper body treatments, 2 for 1 deals, and possibly chair massage.
My major competitor will be Linda Schmuecker LMT who owns and operates “Touch of Paradise Massage”. She is located one block west of Main Street on the north side of town. Her office is very small and somewhat obscure. She is not interested in expanding and is currently only serving 20% of the potential market. While she is more competitive in price, $50.00 vs. $65.00 for a 1 hour massage, I will be more accessible due to having a receptionist. Being in the office of a chiropractor will put a more professional face on my services. She has more experience, but is not very personable or excited about life. I think I will have a better presence with clients. The smallness and feel of her office is welcoming only to those who are already familiar with massage where the feel of the chiropractic office is much less intimidating for those receiving massage for the first time.
Word of mouth is a powerful advertising tool in a small town. Also having a very prominent location on the main thoroughfare through town will be good advertising. I also hope to put some ads on the local radio station.
Operational Plan
Initially this business will operate from within an existing chiropractic office. The chiropractic office is a new business of only a few months. It is located in the previous Chevrolet dealership building on Hwy 275 (Lincoln Street). This is the main thoroughfare through town with two lanes of traffic in both directions. This building now houses Creekwood Chiropractic and Paula’s Dance Studio. McDonalds is located adjacent. The chiropractic office maintained much of the original street facing glass as part of the reception area and waiting room. This room is spacious and comfortable. There are potentially 2 rooms available for use as massage rooms. One room is already finished and the other needs to be finished. Both rooms are 12’X12” an ideal size for massage. The rooms rent for $200.00 ea per/month including utilities and receptionist services. Either room will need to be equipped with approved storage for linens and pillows, a small stereo system, a massage table, chairs, and a closet for client’s clothes. A small space heater and alternate lighting will also be required. Both rooms have excellent privacy and access. The unfinished room will require opening a new doorway into the main hallway, carpet and painting.
The budget for these items and the finishing of the room is $2000.00. There is currently a large kitchen that is shared with the dance studio. I would propose to put a washer and dryer in this room.
There is no expectation for any setbacks in meeting the requirements of the Department of Health and Human Services as the facility is already being used for chiropractics.
I plan to renew my liability insurance with ABMP at a cost of $180.00 per year. In addition a total State license fee of $137.00 will be required this year. There is no business license requirement in West point or sales tax requirement for massage.
All additional therapists will be independent contractors paying 25% of client fees. This will require 12 massages monthly for ea additional room to break even. There will be no employees.
Inventory and associated operations will be evaluated at a later date and will not be a factor in business start up.
There will be no credit extended to clients or insurance billing offered. Payment will be expected upon completion of services. Two no call/no shows will be permitted before payment in advance will be required.
Personal Financial Statement
Assets Amount in Dollars
Cash – $3,500.00
Checking accounts $ 150.00
Savings accounts
Personal property (autos, jewelry, etc.) $5,000.00
Retirement Funds (eg. IRAs, 401k)
Real estate (market value) $150,000.00
Other assets (tools and tractors) $15,000.00
Total Assets $173,650.00
Liabilities Amount in Dollars
Current Debt
(Credit cards, Accounts)
Notes payable (describe below)
Taxes payable $1,200.00
Real estate mortgages (describe)
Other liabilities (school) $1,000.00
Other liabilities (specify)
Total Liabilities $2,200.00
Net Worth $171,450.00
Signature:
Date: 2-4-11
Start up expenses
Decorate room $2000.00
Bolsters 2 @ $30.00 ea 60.00
Massage oil, cream, gel, etc.. 250.00
Cds 30.00
10 sheet sets w/ face cradle covers 325.00
2 chairs-used 150.00
Locking cabinet 450.00
Cleaners 50.00
Lamp 30.00
Cd player 75.00
Washer & dryer used 700.00
TOTAL $4120.00
One year projection
Given start up expenses at $4120.00 one would need $345.00 monthly to recoup costs in one year. The following ongoing monthly expenses would also be incurred:
Rent $200.00
Laundry costs 50.00
Massage oils 20.00
Advertising 100.00
Total monthly costs $370.00
This totals a monthly outgo of $715.00 to break even in one year. At $65.00 per massage this equals 11 massages per month or approximately 3 massages weekly.
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