Basketball Facility Business Plan Template
If you want to start a basketball facility business or expand your current basketball facility business, you need a business plan.
The following Basketball Facility business plan template gives you the key elements to include in a winning Basketball Facility business plan.
Basketball Facility Business Plan Example
I. Executive Summary
Business Overview
[Company Name] is a new community basketball facility located in [location]. The facility offers multiple courts for local residents to play basketball on, as well as classes to improve their skills. Our aim is to inspire a love of basketball in anyone who is interested. Therefore, while we do charge for our membership and classes, we offer discounts to anyone in a low-income bracket. We believe that everyone should enjoy playing and learning basketball without being priced out of the sport.
Products Served
[Company Name] will provide teams, individuals, and families access to basketball courts for a moderate fee. Patrons have the option to get a day pass, ten visit pass, or a monthly pass when they visit our facility.
[Company Name] will also offer classes for anyone who wants to learn basketball basics or improve their skills. Families and individuals who earn less than the median income will be able to participate on a sliding scale fee basis. We will maintain vending machines filled with water, energy drinks, and healthy snacks to keep our patrons fueled while they play. In addition, the facility will house a pro shop, where basketballs, gear, and memorabilia may be purchased.
Customer Focus
[Company Name] is open to serving all residents who live in [location] or the surrounding areas. Anyone who loves basketball and wants to learn, practice, or play with others is welcome in our facility.
The current demographics of [location] are below:
- 85,201 residents
- Median age of 35
- Median salary of $53,000
- 43% married
- 38% with children under 18
Management Team
[Company Name] is run by [Founder’s Name], a former professional basketball athlete, and current basketball coach and sports facility manager. For [X] years, he has managed a popular sports complex within [location], which provided him with in-depth knowledge of both the operations and management sides of running such a facility. Though he found his time with his employer rewarding, it was his love for basketball that inspired him to create a facility that solely focuses on basketball. He also wanted to create a business that better accommodated individuals and families from lower economic brackets so that no one would be priced out from playing the sport.
Success Factors
[Company Name] is uniquely qualified to succeed due to the following reasons:
- There is currently no sports facility that focuses specifically on basketball. Many existing facilities only have one or two courts, which limits how many people can play at any time.
- The location is central to downtown and is easy to access by foot, car, or public transportation.
- The management team has a track record of success in sports facility management.
Financial Highlights
[Company Name] is currently seeking $2,000,000 to launch. Specifically, these funds will be used as follows:
- Facility design/build: $1,500,000
- Equipment: $250,000
- Working capital: $250,000 to pay for marketing, salaries, and maintenance until [Company Name] reaches break-even
Top line projections over the next five years are as follows:
| Financial Summary | FY 1 | FY 2 | FY 3 | FY 4 | FY 5 |
|---|---|---|---|---|---|
| Revenue | $560,401 | $782,152 | $1,069,331 | $1,379,434 | $1,699,644 |
| Total Expenses | $328,233 | $391,429 | $552,149 | $696,577 | $776,687 |
| EBITDA | $232,168 | $390,722 | $517,182 | $682,858 | $922,956 |
| Depreciation | $7,000 | $7,000 | $7,000 | $7,000 | $7,000 |
| EBIT | $225,168 | $383,722 | $510,182 | $675,858 | $915,956 |
| Interest | $6,016 | $5,264 | $4,512 | $3,760 | $3,008 |
| Pre Tax Income | $219,152 | $378,458 | $505,670 | $672,098 | $912,948 |
| Income Tax Expense | $76,703 | $132,460 | $176,985 | $235,234 | $319,532 |
| Net Income | $142,449 | $245,998 | $328,686 | $436,864 | $593,416 |
| Net Profit Margin | 25% | 31% | 31% | 32% | 35% |
II. Company Overview
Who is [Company Name]?
[Company Name] is a new community basketball facility located in [location]. The facility offers multiple courts for local residents to play basketball and participate in classes for improving their skills. Individuals, teams, and families can patronize our pro shop to purchase basketballs and other gear, or purchase energy drinks and healthy snacks from our vending machines.
Though we aim to make a profit, we also want to be a valuable service to the community. Therefore, all passes, gear, snacks, and classes will be offered at a reduced cost for individuals and families earning less than the median income. Everyone has a right to enjoy playing basketball without being priced out.
[Company Name] is run by [Founder’s Name], a former professional basketball athlete, and current basketball coach and sports facility manager. For [X] years, he has managed a popular sports complex within [location], which provided him with in-depth knowledge of both the operations and management sides of running such a facility. Though he found his time with his employer rewarding, his love for basketball inspired him to create a facility that solely focuses on the sport.
[Company Name]’s History
[Company Name] was incorporated by [Founder’s Name] on [date of incorporation] as an S-Corporation. The company is currently being run out of [Founder’s Name]’s home, but once the facility is developed and renovated, all operations will run from there.
Since incorporation, the [Company Name] has achieved the following milestones:
- Located available space to build the facility
- Developed the company’s name, logo, and website located at [website]
- Determined equipment and fixture requirements
- Began recruiting key employees
[Company Name]’s Products/Services
[Company Name] will provide teams, individuals, and families access to basketball courts for a moderate fee. Patrons have the option to get a day pass, ten visit pass, or a monthly pass when they visit our facility.
[Company Name] will offer classes for anyone who wants to learn the basics or improve their skills. Families and individuals who earn less than the median income will be able to participate on a sliding scale fee basis. We will maintain vending machines filled with water, energy drinks, and healthy snacks to keep our patrons fueled while they play. In addition, the facility will house a pro shop, where basketballs, gear, and memorabilia may be purchased.
III. Industry Analysis
Basketball currently ranks as the second most popular major participatory sport in the United
States. It has expanded from a seasonal sport into a year-round activity, with travel teams,
amateur leagues, and training requiring the use of basketball facilities on an ongoing basis.
Basketball’s continuous popularity, particularly among younger consumers, has helped generate
a steady revenue stream for the Indoor Sports Facilities industry.
Not only do young people join school and other competitive teams, but the ease of playing the
sport leads people of all ages to regularly play both organized and impromptu games of
basketball. In fact, 8 million Americans reported playing a game of basketball at least 13 times
last year, or approximately once per month. The number of these regular hoopsters, also known
as “core participants,” has increased by 8% over the past four years.
Additional demand will arise from youth development initiatives. One such initiative, called Jr.
NBA Leagues, is a newly-formed national network of youth basketball leagues aimed at
providing equitable access to team participation for children aged 6 to 14.
A major component of organized team sports is the opportunity to compete in tournaments,
which draw significant spectator audiences. It has been noted that families treat these
tournaments, which often require overnight travel, as vacations, and an area’s tourism benefits
when quality basketball facilities are available to host these tournaments.
These factors contribute to the demand for high quality basketball facilities.
IV. Customer Analysis
Demographic Profile of Target Market
[Company Name] will serve the residents of [location] and its surrounding areas.
The community is known for being active, with a large population of sports and exercise enthusiasts. As a result, community centers and gyms around the city are usually packed day in and day out. [Company Name] will market to sports-minded residents by offering a dedicated facility for all individuals, families, and teams who want to improve their basketball skills, or who are simply eager to play basketball recreationally.
Customer Segmentation
Though everyone is welcome to use the courts at [Company Name], we will primarily target three customer segments:
- Basketball fans: Though there are many gyms and a few community centers around [location], there are few amenities that offer sufficient basketball courts and equipment. [Company Name] aims to stand out as the sole basketball facility in town, which will attract any residents who are passionate about the sport.
- Low-income individuals: Many residents who earn under the local median salary struggle to afford the memberships at sports centers or gyms. [Company Name] will offer a significant discount for anyone in this income bracket so that no one feels priced out from playing basketball.
- Families: Even in the digital age, sports are a great way to bring the family together. We will market services to entice families, such as party packages, hourly court rentals, and discounts on family passes.
V. Competitive Analysis
Direct & Indirect Competitors
The following gyms and recreational facilities are located within a 10-mile radius of [Company Name], thus providing either direct or indirect competition for customers:
Downtown Community Center
Downtown Community Center has been a great service to the residents of [location] for years. The facility offers racquet courts, a basketball court, a swimming pool, and a fitness area for all residents looking to get fit. All of this comes at a moderate price, which allows all residents to enjoy its offerings.
While Downtown Community Center will continue to be a great center for anyone looking for inexpensive recreation, they only have one basketball court, which does not adequately serve the residents [location]. [Company Name] will have multiple basketball courts, with capacity to accommodate multiple teams and reservations at a time.
Global Fitness Gym
Global Fitness Gym is a national chain of gyms with five locations throughout [location]. It is the most popular gym in town, offering cardio machines, weights, a swimming pool, and more for just a modest membership of $30/month. Some locations even have an outdoor basketball court and a mini spa area for premium members.
Though Global Fitness Gym is a competitor for residents looking for general exercise activities, they are not a major competitor when it comes to basketball participation and skills training. A few locations have a basketball court, but this is not the major focus of their brand. Therefore, anyone looking to improve their basketball game or participate in teams will be more enticed by [Company Name].
Uptown’s Recreational Center
Uptown’s Recreational Center has been the go-to sports and recreational facility for the affluent residents of [location] since 2002. For a monthly membership fee, individuals and families can utilize the center’s many facilities, including swimming pools, basketball courts, tennis courts, and more. It is a large complex that has a little something for anyone who visits.
Though Uptown’s Recreational Center will continue to thrive, the pricey membership fee keeps many residents from joining. Furthermore, the facility only has two basketball courts, despite its enormous size. This is not enough space if multiple groups want to play at the same time.
Competitive Advantage
[Company Name] enjoys several advantages over its competitors. These advantages include:
- A focus on basketball: Though sports and recreational facilities offer many great services, those who want to play basketball often find limited options available. [Company Name] will have several courts so no one will have to wait long to play a game.
- Location: [Company Name] will be located in the heart of downtown [location] and be easily accessible by car, foot, or public transportation.
- Affordability: No one should be turned away from a fun activity like basketball just because they can’t pay expensive fees. That’s why our fees are moderately priced. We also offer discounted rates for those who earn less than the median income.
VI. Marketing Plan
[Company Name] seeks to position itself as a high-quality basketball facility that offers everything a basketball player would need. We pride ourselves on our customer service and our modern, clean facilities.
The [Company Name] Brand
The [Company Name] brand will focus on the facility’s unique value proposition:
- Offering a central location in the downtown area
- Providing excellent customer service
- Providing easy access to basketball courts and training for a moderate price
Promotions Strategy
[Company Name] expects its target market to be residents living within a 10-mile radius of its location. [Company Name]’s promotion strategy to reach these potential customers includes:
Website/SEO
[Company Name] will develop a professional website that displays photos of our facilities and a schedule of upcoming classes. The company will also invest in SEO so that the company’s website will appear at the top of search engine results.
Social Media
[Founder’s Name] will create the company’s social media accounts and invest in ads on all social media platforms. The company will use targeted marketing to appeal to our target demographics.
Community Events/Organizations
The company will promote itself by distributing marketing materials and participating in local community events, such as festivals, school sporting events, PTO meetings, etc.
Pre-Opening Events
Before opening the facility, [Company Name] will organize pre-opening events designed for prospective local customers and press contacts. These events will create buzz and awareness for [Company Name] in the area.
Public Relations
We will contact all local and regional area newspapers and television stations to tell them about the facility opening and the unique value proposition of [Company Name].
Sponsorships
[Company Name] will also invest in sponsoring certain nonprofit and community events so that banners and collateral material are displayed all over the event.
Pricing Strategy
[Company Name] pricing will aim to be more moderately priced than most sports complexes but still be high enough to maintain a healthy profit. We will offer discounts to anyone who can prove they earn less than the median income. No matter what services they pay for, customers will feel they receive great value when using our facility.
VII. Operations Plan
Functional Roles
In order to execute [Company Name]’s business model, the company needs to perform many functions, including the following:
Administrative Functions
- Bookkeeping
- Marketing
- Website maintenance
- Hiring and training staff
Gym And Service Functions
- Customer service
- Membership processing
- Teaching classes
- Scheduling classes, games, tournaments, and special events
- Maintenance functions
Milestones
The following are a series of steps that lead to our vision of long-term success. [Company Name] expects to achieve the following milestones in the following [xyz] months:
| Date | Milestone |
|---|---|
| [Date 1] | Finalize lease agreement |
| [Date 2] | Design and build out [Company Name] |
| [Date 3] | Hire and train initial staff |
| [Date 4] | Kickoff of promotional campaign |
| [Date 5] | Launch [Company Name] |
| [Date 6] | Reach break-even |
VIII. Management Team
Management Team Members
[Company Name] is run by [Founder’s Name], a former professional basketball athlete, and current basketball coach and sports facility manager. For [X] years, he has managed a popular sports complex within [location], which provided him with in-depth knowledge of both the operations and management sides of running such a facility. Though he found his time with his employer rewarding, it was his love for basketball that inspired him to create a facility that solely focuses on basketball.
Due to his experience in the industry, he will serve as the Facility Manager. However, [Founder’s Name] will hire an Assistant Manager to run the facility when he is not available.
Hiring Plan
[Founder’s Name] will serve as the Facility Manager. In order to launch the business, we need to hire the following personnel:
- Assistant Manager (1 to start)
- Facility Staff (4 to start)
- Maintenance Staff (1 to start)
IX. Financial Plan
Revenue and Cost Drivers
[Company Name]’s revenue will come from membership fees/passes, parties and court rental, and classes.
The major costs for the company will be the salaries of the staff and the cost of maintaining the facility. In the initial years, the company’s marketing spending will be high as it establishes itself in the market.
Capital Requirements and Use of Funds
[Company Name] is currently seeking $2,000,000 to launch. The capital will be used for funding capital expenditures, labor, marketing expenses, and working capital.
Specifically, these funds will be used as follows:
- Facility design/build: $1,500,000
- Equipment: $250,000
- Working capital: $250,000 to pay for marketing, salaries, and maintenance until [Company Name] reaches break-even
Key Assumptions
The following table reflects the key revenue and cost assumptions made in the financial model:
| Number of customers per day | Per location |
|---|---|
| FY 1 | 50 |
| FY 2 | 75 |
| FY 3 | 100 |
| FY 4 | 125 |
| FY 5 | 150 |
| Average transaction | $19.00 |
| Annual increase in order price | 5.00% |
| Annual Lease (per location) | $60,000 |
| Yearly Lease Increase % | 2.50% |
5 Year Annual Income Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Product/Service A | $151,200 | $333,396 | $367,569 | $405,245 | $446,783 | |
| Product/Service B | $100,800 | $222,264 | $245,046 | $270,163 | $297,855 | |
| Total Revenues | $252,000 | $555,660 | $612,615 | $675,408 | $744,638 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $57,960 | $122,245 | $122,523 | $128,328 | $134,035 | |
| Lease | $60,000 | $61,500 | $63,038 | $64,613 | $66,229 | |
| Marketing | $20,000 | $25,000 | $25,000 | $25,000 | $25,000 | |
| Salaries | $133,890 | $204,030 | $224,943 | $236,190 | $248,000 | |
| Other Expenses | $3,500 | $4,000 | $4,500 | $5,000 | $5,500 | |
| Total Expenses & Costs | $271,850 | $412,775 | $435,504 | $454,131 | $473,263 | |
| EBITDA | ($19,850) | $142,885 | $177,112 | $221,277 | $271,374 | |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 | |
| EBIT | ($56,810) | $105,925 | $140,152 | $184,317 | $234,414 | |
| Interest | $23,621 | $20,668 | $17,716 | $14,763 | $11,810 | |
| PRE-TAX INCOME | ($80,431) | $85,257 | $122,436 | $169,554 | $222,604 | |
| Net Operating Loss | ($80,431) | ($80,431) | $0 | $0 | $0 | |
| Income Tax Expense | $0 | $1,689 | $42,853 | $59,344 | $77,911 | |
| NET INCOME | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 | |
| Net Profit Margin (%) | - | 15.00% | 13.00% | 16.30% | 19.40% |
5 Year Annual Balance Sheet
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $21,000 | $23,153 | $25,526 | $28,142 | $31,027 | |
| Total Current Assets | $37,710 | $113,340 | $184,482 | $286,712 | $423,416 | |
| Fixed assets | $246,450 | $246,450 | $246,450 | $246,450 | $246,450 | |
| Depreciation | $36,960 | $73,920 | $110,880 | $147,840 | $184,800 | |
| Net fixed assets | $209,490 | $172,530 | $135,570 | $98,610 | $61,650 | |
| TOTAL ASSETS | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $317,971 | $272,546 | $227,122 | $181,698 | $136,273 | |
| Accounts payable | $9,660 | $10,187 | $10,210 | $10,694 | $11,170 | |
| Total Liabilities | $327,631 | $282,733 | $237,332 | $192,391 | $147,443 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| Total Equity | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| TOTAL LIABILITIES & EQUITY | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 |
5 Year Annual Cash Flow Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | |||||
| Net Income (Loss) | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 |
| Change in working capital | ($11,340) | ($1,625) | ($2,350) | ($2,133) | ($2,409) |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 |
| Net Cash Flow from Operations | ($54,811) | $118,902 | $114,193 | $145,037 | $179,244 |
| CASH FLOW FROM INVESTMENTS | |||||
| Investment | ($246,450) | $0 | $0 | $0 | $0 |
| Net Cash Flow from Investments | ($246,450) | $0 | $0 | $0 | $0 |
| CASH FLOW FROM FINANCING | |||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 |
| Cash from debt | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| Net Cash Flow from Financing | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| SUMMARY | |||||
| Net Cash Flow | $16,710 | $73,478 | $68,769 | $99,613 | $133,819 |
| Cash at Beginning of Period | $0 | $16,710 | $90,188 | $158,957 | $258,570 |
| Cash at End of Period | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 |
