Business Plan Of KO GYM And

MMA House

Submitted By:Bidhan Chandra Lohani

Submitted To : Sashi Raj Bajracharya Shirish Khanal
Aakash parajuli
Prabin gyawali
Sushant Datta Mishra
Financial plan Proposal summary

KO GYM and MMA house will be funded by the partners who agree upon themselves to start a
business . each partner will contribute to 25 lacs and the rest of the amount needed to run the
Centre will be obtained from the bank. The amount invested will be used to buy the assets the
centre require to run the business and as well as buy the inventories too. It will be difficult to pay
the employee salary and expenses from the first month income. So we will use the cash
contributed by the 5 members to pay the salary of Trainers and the other staffs as well. And we
will be taking a land on lease for 25 years by forming a contract with the owners and agreeing
upon to no increment in rent of land for next 10 years and we will be constructing Hall of our
own requirement on that land, where we agreed to return the land along with the Hall to the
owners of it after the end of 25 years . With the amount invested in the Business we are hoping
to achieve the profit margin of above 42 % in the next 3 year through our sales.

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 1. Table of content

Table of Contents
1. Table of content .................................................................................................................................... 3
2. Executive Summary ............................................................................................................................... 5
2.1 Mission ................................................................................................................................................ 5
2.2 Objectives............................................................................................................................................ 5
3 Business Description ............................................................................................................................. 6
3.1 Firm Identification .............................................................................................................................. 6
3.2 Business history ............................................................................................................................ 6
3.3 Management And Key People ..................................................................................................... 6
3.4 Products and services ................................................................................................................... 6
4. Operating Plan ...................................................................................................................................... 7
4.1 Firm location ................................................................................................................................. 7
4.1.1 Location of customer ............................................................................................................ 7
4.1.2 Location of the supplier ............................................................................................................... 7
4.1.3 Access to transportation ............................................................................................................... 7
4.1.4 Community features ............................................................................................................. 7
4.2 Facility Requirement ..................................................................................................................... 7
4.3 Layout ........................................................................................................................................... 8
5 Inventory management and control. ........................................................................................................ 9
6 Quality control and customer service ........................................................................................................ 9
6.1 Improve quality ............................................................................................................................ 9
6.2 Effective TQM Program ............................................................................................................... 10
6.3 Tools of TQM ............................................................................................................................... 10
6.4 TQM in knockout MMA center .................................................................................................... 11
7 Organizational plan ............................................................................................................................. 11
7.1 Legal form of Ownership .................................................................................................................. 11
7.2 Management Philosophy ................................................................................................................... 12
7.3 Organization Structure ...................................................................................................................... 12
7.4 Key people Assessment/Job description ........................................................................................... 12
9. Industry Analysis ................................................................................................................................ 13

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 9.1 Industry Description.......................................................................................................................... 13
9.2 Industry Competition ........................................................................................................................ 13
9.3 Industry Growth and Sales Projection .............................................................................................. 13
10. Market Analysis ..................................................................................................................................... 15
10.1 Target customer .............................................................................................................................. 15
10.2 SWOT ANALYSIS ............................................................................................................................. 15
11 Financial Plan ......................................................................................................................................... 18
11.1 Pro Forma Income Statement ......................................................................................................... 18
11.2 Pro Forma Balance sheet ................................................................................................................ 19
11.3 Ratio Analysis ................................................................................................................................. 20
12 Sample of Questionnaire for survey ..................................................................................................... 21

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 2. Executive Summary
The KO GYM And MMA Center is a thriving business but is also one of the only Full MMA focused
clubs inside the valley . Most of our members will be under the age of 30 and have young children and
old peoples as well . The center will try to enroll 400 members in its 1st year . A center membership is
Rs.2000 a year for GYM. Rs1500 a year for Jumba and Rs 5000 a year for the MMA. The KO GYM and
MMA Center wants to add an additional 300 members with over the next 5 years year. And this will be
achieved through the following means:

Creating an Ultra safe environment with properly trained staff.

Making Gym And MMA group more friendly.
Providing the new member with the instructions and care.
Ensuring the health and safety of the members .
Ensuring the Fun factor is high in order to generate strong word of mouth marketing.

More and more Nepalese are looking to pay for experiences rather than just products. Ko Gym and
MMA will focus on providing each customer with an experience that will make them want to come back
for more. KO Gym and MMA will be a Limited Liability Company, with start-up funding provided in its
entirety by the owners.

2.1 Mission
KOs mission is to provide patrons of all ages a fun, safe environment in which to exercise, socialize, and
gain new mixed martial arts skills. By focusing on these fundamental qualities, the friendly and
knowledgeable staff will create an environment that is welcoming to wanting to try MMA for the first
time.

2.2 Objectives
KO plans on achieving three objectives:

1. Sales in the first 12 months of over Rs 4000000 .

2. Sales growth of at least 5% in the second and third years of operation.

3. Become the primary center for GYM and MMA in the valley.

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3 Business Description

3.1 Firm Identification

Knockout MMA centre specializes on providing a Mixed Martial classes for the adults as well as
for the kids. Our firm mainly focuses on providing a service rather than providing a Product. So
our firm falls under the category of Service providing industry. Our KO MMA and gym house
also focuses on providing the regular weight loss training, regular boxing classes to the adults as
well as for the kids and zumba classes for the ladies as well.

3.2 Business history

There are few MMA Centre inside the valley. But these are only providing the Judo classes in
the name of providing MMA to the peoples. And our Knock Out MMA centre doesnt only
provide Judo training but other many as well such as: Maui Thai and Brazilian Jui Jutsu. So it is
plausible to say that our Ko MMA is the Only One MMA Centre which provides Real MMA
training to the people.

3.3 Management And Key People

Key people for this firm will be the stakeholders of this firm such as the suppliers of various
equipment for this firm, trainers, health inspectors, one who look over the finance of this firm ,
inventory control and management head, receptionist who handles the feedback of the people
and look for the incoming and outgoing of the people from the firm.

3.4 Products and services

As it is a MMA center, so we will be heavily focused on providing service to the
customer instead of product. And our service includes:

Three months weight loss program.

Strength building program
Regular MMA classes for adult and kids separately.

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 4. Operating Plan
4.1 Firm location
Bhaisipati is the location of the firm that has been selected for the training people with the
peaceful surrounding and environment. And the rent in the area is relatively low other places.
And the rent expenses amount to around Rs.500000 in that place.

4.1.1 Location of customer

Customer will be the people mainly from Lalitpur area but the interested people around the
city can join the gym.

4.1.2 Location of the supplier

Location of the supplier is not fixed at all suppliers chosen for providing equipment will be on
preference basis. For e.g.:- supplier who provide dumbbell for much lower cost will be our
leading supplier for that particular equipment.

4.1.3 Access to transportation

Location that we have selected approximately one K.M outside the ring road area. And there are
plenty of vehicle, be it private or public, found around that location. So there is good access of
transportation facility.

4.1.4 Community features

Bhaisipati is a peaceful residential area. And mostly people of upper middle class and higher
class reside in that area.

4.2 Facility Requirement

The facility that we are going to have needs a hall in order to train strength building and for
regular MMA class. We are going to provide locker facility for each and every member of MMA
classes. So, that they can put their personal material inside it. We also need a power backup. So,
inverter for light. And for refreshment to member we are going to put Music system and T.V
inside the facility.

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4.3 Layout
Our main focus will be on MMA classes and so will be using half 1st floor mainly for MMA
classes. And for the ground floor we will be using it as weight loss and strength building
activities, and we are going to have our offices divided into 3 part: one for the Finance
department other for the Inventory management Control Department and last is the Receptionist
Office.

Ground Floor

Weight loss Classes Boxing Classes

Zumba classes

Finance Reception

Inventory Control Room

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 1St Floor

Zudo Muyay thai

Ring

Ring
Brazillian Jiu Jutsu

5 Inventory management and control.

To manage inventory , one requires the great deal of time and money. And in Our KO MMA and GYM
house managing inventory is not a difficult task. There are mainly 2 inventories : one related with the
machines and equipment of GYM and other is the protein shakes and other material related with the
consumption of people inside the GYM house. The protein shakes and steroids ,that people inside the
gym house consumes on daily basis, there are items in inventory for 15 days that can lasts. And re order
point for such items are 4 days prior the ending of the inventory. And inventory management related with
that of GYM equipment is not a great deal of task, Gym equipment can lasts in inventory for a very much
long time but the problem of rusting can be a serious problem. So the maximum use of oil and grease on
such equipment should be done so that they do not get jammed or rust easily

6 Quality control and customer service

6.1 Improve quality
By being faster in delivering the services as well as by giving response to the customer queries
we can increase our quality. And by providing services virtually, that is providing a teaching

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technique of MMA to the people through may also help in the improving the quality of the
firm or center as well.
And as it is for the upper middle classes and higher classes of people. So basically changing
higher prices initiates, the better quality if the service. And also by having experience at reputed
trainers, we can improve our center reputation, which in term help increasing our quality as
well, in hence increases our productivity.

6.2 Effective TQM Program

Our knockout MMA center is a service center rather than the manufacturing center. And to use
PDCA cycle as an approach to change an problem solving is very much at the heart of Knock
out MMA center PDCA include four phases:-
Plan: - Identifying and analyzing problem.
Do: - Developing and testing potential solution.
Check:- Measuring how effective the test solution was
Act: - Implementing the improved solution fully.

6.3 Tools of TQM

To solve the problem, first we will use Ishikawa diagram to find out the potential causes of the
problem, and then we will move on solve the problem for e.g.

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 Method Man

Lack of trainee Attention

Too many trainings in a day
Improper Counselling by Trainer
Improper handling of equipment

Trainee Injuries Problem In KO MMA

Dumbells Weight
Improper Grip of the Material
Rusty Pulley Wheels and bearings

Material Machine

6.4 TQM in knockout MMA center

Our MMA center mainly, is a service center, and we will be using highly trained official to
provide training almost zero percentage chance of error from the trainers side we will have
different shift for adult, old and as well as for kids too. Classes will be run regularly, and our
management team and trainer will show proper courtesy towards the people and any quires a
people will handled properly in no time.

7 Organizational plan
7.1 Legal form of Ownership
Its a partnership firm created with mutual consent of various partners.

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 7.2 Management Philosophy
As our company is service oriented we largely focus on our customers. Their happiness and
satisfaction are our major concern. The success of our firm is based on our customers. We've
seen a lot of change in the fitness industry over the years, but our philosophy has remained the
same: to offer the best equipment, range of classes, knowledgeable staff and professional advice
in a welcoming environment, that helps keep our members motivated.

7.3 Organization Structure

Manager

Inventory
Finance Health
Receptionist Control Trainers Staffs
Department inspector
management

Brazillian Jiu
MUay Thai Judo Boxing Jumba
jutsu

7.4 Key people Assessment/Job description

We will have total of 16 people working for us of which we will have to pay 13 people working at the
KO GYM and MMA house. Receptionist will look towards the inflow and outflow of people at the GYM
and MMA centre and she/he will also be responsible for collecting the feedback from the people about the
Centre. To control over the inventory we will have our very own founder of the GYM house, he will look
toward the inflow and outflow of the gym equipment and the protein shakes and the steroids. There is
one health inspector: and as a health inspectors we have assigned Physiotherapist whose main duty is to
look toward the injuries people obtain at the MMA and GYM centre. To control the finance we have one
of our Founder member, who looks towards the inflow and outflow of cash from the centre. There are
total 9 trainers: 3 for the MMA , 3 for the JUmba and the remaining 3 for the weight loss and strength
building classes. There are 2 staffs, one will be the cleaner and the other will be providing the necessary
equipment and refreshment for the other key personnel

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Payroll Expenses Of KO MMA AND GYM House (Assuming 10% Annual increment)

Section No Of personnel Monthly 2016 2017 2018

MMA 3 20000 each Rs.720000 Rs.792000 Rs.871200
JUmba 3 15000 each Rs.540000 Rs.594000 Rs.653400
GYM 3 15000 each Rs.540000 Rs.594000 Rs.653400
Health inspector 1 25000 each Rs.300000 Rs.330000 Rs.330000
Receptionist 1 14000 each Rs.168000 Rs.184800 Rs.184800
Staffs 2 10000 each Rs.240000 Rs.264000 Rs.264000

9. Industry Analysis
9.1 Industry Description
We are service oriented organization. Our main strength is how service is provided to our
customers. The type of service we are providing is different than others or we may call it a
totally new concept of industry in Nepal. Our organization is a combo of gym house, fitness
center and mix martial arts training house.

9.2 Industry Competition

We do not have any competitors who can directly impact our business as we are providing new
type of service experiences to the customers. Although gym houses, and fitness service centers
can somewhat affect our business. We have listed Patan Gym, Rage Fitness Center and Hardik
Fitness as our counterparts. They do not provide the same service as of ours but somewhat
similar services like gym house, yoga, Zumba etc. which may affect our business.

9.3 Industry Growth and Sales Projection

We have immense scope in this sector because nowadays people are becoming more fitness
conscious. Theres an emerging market of fitness service and extra-curricular activities for both
health and security reasons. As our targeted customers are middle class and upper classes who

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also can afford our services and are interested towards it.

The growth in this sector is not increasing at a rapid pace but its increasing at certain rate. Its
slow but it is in increasing trend. Every year there is increase of certain rate which is very
promising for to start business in this sector.

We conducted a small survey at Hardik Fitness where we find:

1. full time members (who has subscribed various packages and are committed)
2. Partial members (who visits occasionally)

3. Members who visits at certain intervals

Every year there is 5 to 6% increase in the full time customers.

Sales is also dependent on the location i.e. where the service is being provided. As we have
decided to provide our service in Bhaisepati, Lalitpur which is a VIP area. The residents of there
are mostly upper class and middle class who suits our business.

To increase the flow of customers we should provide various service packages, offers, gift
hampers etc. all at suitable price range.

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 10. Market Analysis
10.1 Target customer
The market for KO GYM and MMA reflects the demographics and standard of living in much the same
way that the major gyms and personal training facilities are segmented. Below are listed market segments
based on the usual demographics seen in today's fitness industry:

Age Range 20-60: It is known that in the fitness community, those clients looking for personal training
and willing to spend the money for it, are between the ages of 30-60.
Yearly income of greater than RS,2400000: Most clients are more willing to pay a premium for one-on-
one coaching when they make more than RS.2400000.
% of population with gym memberships: The latest study shows that 15% of the population has a gym
membership. KO GYM and MMA tend to capture 1-3% of the population.
General population within a 5-mile radius of the facility: To run a successful facility, we need at least
50,000 residents to generate a sufficient number of members for a profitable franchise.
Athletic males: KO GYM and MMA attracts active male athletes.
All females: Conversely, KO GYM and MMA attracts all types of females. Females are more willing to
try new things and are less worried about failing

10.2 SWOT ANALYSIS

The SWOT analysis provides us with an opportunity to examine the strengths and weaknesses BuffUp
Lake Oswego must address. It also allows us to examine the opportunities presented to BuffUp Lake
Oswego as well as potential threats.

Strengths:

Knowledgeable and friendly staff: Our staff consists of professionally trained personnel that have a true
passion for helping the community and caring for the needs of its members. This becomes apparent
when you look at our staff's professional background. We have proven that we are willing to go above
and beyond to suit the needs of our customers.
Top of the line equipment: Our customers will enjoy the finest in fitness equipment.

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 Online presence: Each member will have access to shop, schedule and track fitness progress online. All
scheduling will be automated for fast and efficient communication with our members.
Fun, family ambiance: When you walk into our facility, you will feel the family atmosphere. Our
members will feel comfortable and eager to cheer each other on. Our facility will give the athlete an old
school feeling, making them feel as if they are a part of an early "Rocky" movie. No machines no
mirrors just bumper weights, mixed martial arts and many Olympic exercises and other Jumba classes .
Clear vision of the market need: Ko GYM and MMA knows what our customers have been missing at
their current gyms. We know what exercises work and we know what keeps people motivated. In return,
we know we will create very loyal, passionate members.

Weaknesses:

Newness: Although KO GYM and MMA has built a loyal following, But our brand is not yet a
household name.
High membership fees relative to traditional gyms: Our services may not appeal to potential
customers with a limited budget. Of course, our services are more affordable than personal trainers, but
we will need to identify an engage the large mid-range customers.

Opportunities:

The growing population interested in group fitness: In the last couple of years, we've found that there
is a huge population of individuals that are more interested in group workouts than going to the gym
alone.
Social bonds fostered by group workouts: Our exercise programs are building personal bonds and
friendships. These bonds have led to an internet-based fitness community covering more than 720
facilities. It has become a viral marketing phenomenon, and members are sharing this excitement with
new people every day.
Growing market: KO GYM and MMA is a relatively new brand in the marketplace. We have a
foundation and a reputation within the diehard fitness community, but a significant percentage of our
target market has still not been introduced to our services.
Internet possibilities: We plan to create an online store and build our internet fitness community.

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 Threats:

Declining economy: Many people are becoming increasingly conservative with how their money is
being spent.
Copycat training services by gyms and independent trainers: Certainly other services will try to
mimic the success of KO GYM and MMA, but we are confident that our proprietary programs and
national reputation will limit the impact of copycats on our bottom line.
.

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11 Financial Plan

11.1 Pro Forma Income Statement

Pro forma Income Statement

of

KO GYM AND MMA CENTRE

2016 2017 2018

Sales 6120000 6426000 6747300

Installation Cost 15000 10000 0

Gross Margin 6105000 6416000 6747300

Expenses

Payroll Expenses 2400000 2520000 2646000

Advertising and Marketing 150000 100000 100000

Depreciation (2.5%) 57500 62500 62500

Rent 500000 500000 500000

Utilities 36000 38000 40000

Total Operating Expenses 3143500 3220500 3348500

Profit Before Interest and Tax 2961500 3195500 3398800

Tax (13%) 384995 415415 441844

Net income 2576505 2780085 2956956

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11.2 Pro Forma Balance sheet
Pro Forma balance Sheet

Of

KO GYM AND MMA CENTRE

Assets 2016 2017 2018

Current Assets

Cash 4120000 4926000 5081300

Prepaid expenses 899000 689500 700000

Total Current Assets 5019000 5615500 5781300

Long-term Assets

Fixed Assets 2300000 2500000 2500000

Building 6000000 6000000 6000000

Accumulated Depreciation (57500) (120000) (182500)

Total Long-Term Assets 8242500 8380000 8317500

Assets Total 13261500 13995500 14098800

Liabilities and Capital

Current liabilites

Account payable 2000000 2300000 2200000

Income tax payable 384995 415415 441844

Owners Equity

Retained earning 2576505 2780085 2956956

Capital 8300000 8500000 8500000

Total Liabilities and Capital 13261500 13995500 14098800

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11.3 Ratio Analysis

Ratio analysis

Of

KO GYM And MMA

2015 2016 2017

Profit margin 42% 43% 43.82%

Return on Assets 19.42% 19.86% 20.97%

Current Ratio 2.10 2.06 2.188

Quick ratio 1.72 1.81 1.899

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12 Sample of Questionnaire for survey
SURVEY QUESTIONNAIR FOR GYM AND MMA

Name(optional)

Gender 1. Male 2. Female

Age
group 18-20 20-24 25-29 30-35 36-40 40+

Questions:-

1. How much are you interested in fitness and martial arts?

i. Not interested ii. Interested iii. Highly interested.

2. Are you clear about the concept (advantages) of gym/MMA?

i. Yes ii. NO

3. How much distance you willing to travel from home to gym house?
i. 500m ii. 1km iii. 1.5km iv.2km

4. How much are you willing to spend for fitness purpose?(In Rs. per month)
i. 1000 ii. 1500 ii.2000 iv.2000+

5. Have you ever been membership of any fitness club?

i. Yes ii. No

6. How long do you spend in gym house in an average visit?

i. 0-30 min
ii. 31-60min
iii. 61-90min
iv. 90+

7. Does your fitness club provides a personal trainer?

i. Yes, included with membership fee.
ii. Yes, with additional charge.
iii. No.

8. How satisfied are you with the value for money offered by the membership of your health
club?
i. Excellent.
ii. Good.

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 iii. Average.
iv. Bad
v. Very Bad

9. Will you change your current health club if you get another fitness center with more facility
and good environment?
i. Sure, I am searching for that.
ii. No, I am satisfied with my current health club.

10. Do you want to give any personal suggestion for the new fitness center that is going to be
started?

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