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Feasibility Report On GYM

Presented to
Sir Arsalan Hashmi

Presented by
Lubna Sahar (60934)
Fabiha Naseem (62286)
Muhammad Shahroz (61411)
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TABLE OF CONTENT:
1. Acknowledgment
2. Introduction
3. Mission And Vision
4. Initial Development Plan
5. Target Marketing Strategy
6. Promotion Strategy
7. SWOT Analysis
8. Critical Factors
9. Installed Capacity Of The Project
10. Project Location
11. Space Requirement
12. Project Financing
13. Project Investment
14. Human Resource Requirement
15. Revenue Generation In 1st Year
16. Machinery & Equipment Details
17. Income Statement For 5 Years
18. Cash Flow Statement For 5 Years
19. Balance Sheet For 5 Years
20. Balance Sheet For 5 Years
21. Conclusion
22. References
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ACKNOWLEDGMENT

Success and achievement is possible only through hard work,

determination and strong will. We are grateful to almighty Allah
who gave me the strength to think, plan and act accordingly which
made us possible to complete our project on time.

It is pleasure to act acknowledgment people involved directly or

indirectly in the completion of our project.

We would also like to thanks SIR ARSALAN HASHMI who taught

this subject and gave guidelines to complete the project which
increased our knowledge and opened new ways of learning.
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MISSION

Our mission is to provide an entertaining, educational, friendly, and

innovating experience of uncompromising quality that meets the health
and fitness needs of the individuals.

VISION

The vision of the company is to provide health and fitness education and
entertainment to the individuals all over the city.
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FITNESS CENTER SLOGAN

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INITIAL DEVELOPMENT PLAN

The club will be established in a rented FLAT having an area of

Approx. 300 yards and would be centrally located within a
residential Flat near Bilawal Chowrangi to provide the locality with
a facility which, at present, is non-existent in both the facilities.

It will initially have the capability to accommodate 100 people, with

plans to increase it up to 30 people in every half years time.
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TARGET MARKETING STRATEGY

Fitness 360 will begin by targeting young and unhealthy people
in the vicinity through promotion and advertising. We will
promote interest of people towards exercise, fitness and a
healthy lifestyle. We will focus on our initial customers
producing noticeable results which will create a domino effect
in the vicinity.

LOCATION
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PROMOTION STRATEGY
Initial promotional activity through:

Word-of-mouth marketing.

Online marketing.
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Banners & Pamphlets Advertisement

Social Media i.e. Face book, Whatsapp

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SWOT ANALYSIS
STRENGTH

The only gym in the vicinity

Easy accessibility to adjoining residential areas
Market domination
Big parking space
Furniture and fixture already installed

WEAKNESS

Initially some low standard equipment

Initial marketing
Congested space

OPPORTUNITIES

Monopolize the market

Provide the best facilities in the region
Be the only choice for a good gym

THREATS
Non-punctuality of the people
Damage to machinery due to a non- professional approach
competitors
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CRITICAL FACTORS

1. Selection of an appropriate location within the vicinity of a

residential society.

2. Selection of affordable and quality machinery & equipment

i.e. exercise machines etc.

3. The Manager should himself have technical know how of all

the services being offered.

4. The services of qualified instructors and physician should be

hired as supervised workouts improve results.

5. Utmost priority should be to provide members a lifestyle that

encourages fitness through the safest and latest means.
Products like heart-rate monitors, calorie expenditure,
display units, and etc., should be used to enhance client
motivation maintaining a clean, hygienic and healthy
environment.

6. Marketing and promotion through various channels i.e.

pamphlets, outdoor advertisement, hoardings / flex signs
and promotion through social media (Facebook, WhatsApp
groups etc.)
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INSTALLED CAPACITY OF THE PROJECT

Description Details
Total Capacity of the Club ( Members per day) 100 members

Target Capacity Utilization in 1st year @ 75% (i.e. 75 members)

Years to attain max. capacity utilization 5 Years

Session 2 sessions

Morning Sessions (6 AM 1 PM)

Sessions of Operations
Evening Sessions (5 PM 10 PM)

Ratio of Male & Female Members (after 5 years) 70% Male : 30% Female

Male : 7 hours
Time Slot for Male & Female members
Female : 5 Hours
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SPACE REQUIREMENT

Space Requirement Yards

Exercise Hall 225

Office 25

Washroom and Changing Room (Separately) 50

Total Area 300

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PROJECT FINANCING

Description Details

Total Capital (500,000 *3) Rs. 1,500,000

Number of Participants 3 Person

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PROJECT INVESTMENT

CAPITAL COST Amount in (Rs)

Machinery & Equipment 1,034,860

Office Equipment 242,000

Furniture and Fixtures 40,000

Advance Deposit 100,000

Total Project Cost 1,416,860

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HUMAN RESOURCE REQUIREMENT

No. of Salary per

Description
Employees Employee

Instructor 2 40,000

Admin / Account Officer 1 20,000

Cleaner 1 12,000

Total 4 72,000
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REVENUE GENERATION IN 1ST YEAR

Fee 1st Year Capacity Total Revenue for

Product Max. Capacity
(Rs.) Utilization 1st Year

Members 100 - 75

Membership
Fee
- 3,000 75 225,000

Monthly Fee - 1500 75 112,500*12

Total 1,575,000
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MACHINERY & EQUIPMENT

Office Equipment Required

Description Quantity Unit Cost Total Cost

(Rs.) (Rs.)

Laptop 1 50,000 50,000

Printer 1 12,000 12,000

Sound System 1 30,000 30,000

A/C 3 40,000 120,000

Water Dispenser 2 15,000 30,000

Total 242,000
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MACHINERY & EQUIPMENT

Particulars Qty Price Description

Plates 120,000
Rods 40,000
Mirrors 50,000
Dumbbells 50 sets 37,500
Rods with Plates 34 sets 81,360
Gym Rubber Carpet 15,000
Machines:
Straight Bench 4 48,000 12,000 each
Incline Bench Press 2 24,000 12,000 each
Decline Bench Press 2 24,000 12,000 each
Back Pulley 2 70,000 35,000 each
Butter Fly Machine 1 40,000
Flower Machine 1 40,000
Rowing Machine 1 40,000
Smith Machine 1 60,000
Running Machine 2 80,000 40,000 each
Pull up/down Shoulder Machine 1 40,000
Thai Exercise Machine 1 35,000
Leg Exercise Machine 1 35,000
Cabie Cross 1 65,000
Tricep Exercise Machine 1 30,000
Bicep Exercise Machine 1 35,000
Sub Total 1,009,860
Add: Other Fitting Charges 25,000

Total Machinery & Equipment 1,034,860

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INCOME STATEMENT FOR 5 YEARS

Year 1 Year 2 Year 3 Year 4 Year 5
REVENUE:

Admission Fee 225,000 150,000 120,000 110,000 90,000

Monthly Fee 1,350,000 1,600,000 1,850,000 2,200,000 2,500,000

Total Revenue 1,575,000 1,750,000 1,970,000 2,310,000 2,590,000

GENERAL ADMINISTRATION &

EXPENSES:

Rent Expense (Plot) 420,000 462,000 508,200 559,020 614922

Utilities Expense 120,000 150,000 165,000 175,000 185,000

Office Expenses 90,000 110,000 125,000 130,000 150,000

Salary Expense 684,000 752,400 827,640 910,404 1,001,808

Repairing and maintenance 50,000 65,000 80,000 70,000 90,000

Promotional Expense 50,000 - - - -

Depreciation Expense (Machinery &

66,666 66,666 66,666 66,666 66,666
Equipment)

Depreciation Expense (Office Equipment) 5,000 5,000 5,000 5,000 5,000

Total Expenses (1,485,666) (1,611,066) (1,777,506) (1,916,090) (2,113,396)

89,334 138,934 192,494 393,910 476,604

Net Profit Before Tax

Tax Amount - - - - (1533)

Net Profit After Tax 89,334 138,934 192,494 393,910 475,071

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CASH FLOW STATEMENT FOR 5 YEARS

Year 1 Year 2 Year 3 Year 4 Year 5

Cash in Hand (Beginning) 83,140 244,140 454,740 718,900 1,184,476

CASH RECEIPTS:

Admission Fee 225,000 150,000 120,000 110,000 90,000

Monthly Fee 1,350,000 1,600,000 1,850,000 2,200,000 2,500,000

Total Cash Receipts 1,658,140 1,994,140 2,424,740 3,028,900 3,774,476

OPERATING CASH FLOW:
CASH PAID OUT:

Rent Expense (Plot) 420,000 462,000 508,200 559,020 614,922

Utilities Expense 120,000 150,000 165,000 175,000 185,000

Office Expenses 90,000 110,000 125,000 130,000 150,000

Salary Expense 684,000 752,400 827,640 910,404 1,001,808

Repairing and maintenance 50,000 65,000 80,000 70,000 90,000

Promotional Expense 50,000 - - - -

Tax Expense - - 1,533

Total Cash Paid (1,414,000) (1,539,400) (1,705,840) (1,844,424) (2,043,263)

Cash In Hand (At End) 244,140 454,740 718,900 1,184,476 1,731,213

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BALANCE SHEET FOR 5 YEARS

Assets
Year 1 Year 2 Year 3 Year 4 Year 5
Current Assets:

Cash 244,140 454,740 718,900 1,184,476 1,731,213

Advance Deposited 100,000 100,000 100,000 100,000 100,000

Total Current Assets 344,140 554,740 818,900 1,284,476 1,831,213

Fixed Assets:

Machinery & Equipment 1,034,860 1,034,860 1,034,860 1,034,860 1,034,860

Less: Accumulated depreciation (66,666) (133,332) (199,998) (266,664) (333,330)

Net Machinery & Equipment 968,194 901,528 834,862 768,196 701,530

Office Equipment 242,000 242,000 242,000 242,000 242,000

Less: Accumulated depreciation (5,000) (10,000) (15,000) (20,000) (25,000)

Net Office Equipment 237,000 232,000 227,000 222,000 217,000

Furniture and Fixtures 40,000 40,000 40,000 40,000 40,000

Total Fixed Assets 1,245,194 1,173,528 1,101,862 1,030,196 958,530

Total Assets 1,589,334 1,728,268 1,920,762 2,314,672 2,789,743

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BALANCE SHEET FOR 5 YEARS

Equity and Liabilities:

Year 1 Year 2 Year 3 Year 4 Year 5
Liabilities:
Liabilities - - - - -
Total liabilities - - - - -

Owner's Equity:
Capital (Muhammad shahroz) 500,000 500,000 500,000 500,000 500,000

Capital (Lubna sahar) 500,000 500,000 500,000 500,000 500,000

Capital (fabhia naseem) 500,000 500,000 500,000 500,000 500,000

Retained Earnings - 89,334 228,268 420,762 814,672

Add: Net Profit & Loss 89,334 138,934 192,494 393,910 475,071
Total Equities 1,589,334 1,728,268 1,920,762 2,341,672 2,789,743
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CONCLUSION

Exercise is generally acknowledged to be important for weight

control, strengthening bones and muscles and increased stamina.
Nevertheless, the benefits of exercise transcend these common
facts to many other aspects of health and wellness. Other
reasons why people should exercise include a reduced the risk of
disease, increased brain health, improved energy, sleep and, in
the end, a longer life and it is the only we are considering GYM as
a proper business which provides health and fitness to people,
profits may be low but it provides a healthy environment and
beautiful stronger life.
Concluding all the study, the business seems favorable in terms
of profit after 2 years, the first year seems little bit tough in order
profit because people are less aware about Health and Fitness,
As the gradually we are able to capture locality, the business can
be expanded by providing proper and attractable services to
people which requires high qualities machineries and equipment.
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REFERENCES

We tried our best and visited those places where we can target
and we found bilawal house chowrangi perfect place to targeting
market gap and we visited there and get some information about
rent, location pictures etc. We touched some of best seller of
Fitness Machineries and Equipment we collected Other Fixed
Asset prices from online store www.daraz.pk and www.kaym.pk
who deliver in discounted price.

These are the contact references of visited location:

Shop Name: SALMAN SPORTS

Address: SHOP NO 25, LIght HOUSE, M.A JINNAH ROAD , Near
DOW MEDICAL , Karachi
Contact Person: MR SALMAN
Phone: 0311-1200097