A MARKETING PLAN FOR EUPHORIA GYM

POKHARA UNIVERSITY
DHUNGEPATAN, LEKHNATH

SUBMITTED BY
MISS SUSHMA THAPA
MBA 3rd Trimester
Roll no :22575051

SUBMITTED TO
Mr. Bal Ram Bhattarai
(In partial fulfillment of marketing management final evaluation)

Pokhara University, School of Business

20th DECEMBER,2023

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ACKNOWLEDGE

First of all, I would like to express my great gratitude to our respected sir Mr.
Bal Ram Bhattarai, Associate Professor at Pokhara University for providing
us with the opportunity to enhance our initiative marketing business plan
and explore our new ideas through theoretical approaches into the final
steps.

With the gratitude, I am thankful towards Pokhara University’s Master of

Business Administration program for including such a course in the
curriculum activities.

Finally, this would be my last offer to thank all the representatives of the
administrative departments of the university and other supervisors’ staff for
assisting in providing essential information.

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1. Introduction

1.1The genesis of the project ....................................................................6

2. Research methods .............................................................................................. 6

2.2. Method ...............................................................................................6

2.3. Objectives of the business plan ...........................................................7

2.4. Short comings......................................................................................7

3. Executive Summary ............................................................................................. 8

4. The Company, business field and industry ........................................................... 8

4.2. The business idea ................................................................................9

4.3. Fundamental Objectives of Euphoria GYM ..........................................9

4.4. Opportunities on the market and vision ..............................................9

5 Market analysis..................................................................................................... 9

5.1. The Market Demand..........................................................................10

5.2. Fluctuations in demand ..................................................................... 10

5.3. The market environment ................................................................... 11

5.4. Porter’s Five Force Analysis................................................................ 11

5.4.1. Threats of New Entrants ...................................................... 12

5.4.2. Power of Suppliers ............................................................... 12

5.4.3. Power of Buyers................................................................... 12

5.4.4. Availability to Substitutes .................................................... 12

5.4.5. Competitive Rivalry.............................................................. 12

5.5. SWOT ................................................................................................ 14

5.6. Competitors Advantages and Analysis ............................................... 13

6Marketing Strategy .......................................................................................... 16

6.1. Objectives and issues ........................................................................... 16

6.1.2 Fitness Center market objectives: .............................................. 18

6.2. Segmentation.......................................................................................19

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 6.3. Marketing strategy............................................................................... 20

6.3.1. Advertisement Channels ............................................................ 20

6.3.2. Personal Selling .......................................................................... 21

6.3.3. Public Relations.......................................................................... 21

6.3.4. Pricing ........................................................................................ 21

6.3.5. Innovative in thinking................................................................. 21

7. Location and Production Factors.................................................................... 22

7.1Location and equipment ........................................................................ 22

7.2Employees: ............................................................................................. 22
7.2.1Advanced learning ...................................................................... 23
7.1.1. Job description: .......................................................................... 23

7.2. Wages ………………………………………………………………………………………………24

8. Corporate structure and Human Resource Management ....................... 25

9 Operation Plan.............................................................................................. 25

9.1. Operating Cost ........................................................................................ 25

9.1.2.Fixed Cost ............................................................................... 25

9.1.3.Variable Cost……………………………………………………………….........25
10 Conclusion………………………………………………………………………………………………30

TABULAR DATA:
• START UP COST
• OTHER BEGINNING COST
• PRELIMINARY EXPENSES
• PRELIMINARY EXPENSES WRITTEN OFF
• CAPITAL SOURCE

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1 Introduction
With technological and social changes exercise is becoming less and less part of our
day-to-day activities. Our cultures have moved from physically intense work over
to working mostly in offices all day long. This has led people to seek out alternative
in exercises like attending courses of CrossFit or training at fitness centers. In these
past years health consciousness has also been increasing and awareness of the
benefits of a healthy lifestyle have further increased the demand from the society
for more exercise options, some options for everybody.
The main question that this business plan will answer is if there is market for
running a Euphoria Gym in Pokhara? To answer this question, it is important that
the research material is defined with even further with sub questions.
The sub questions which were used to answer the main question were as follows:
• What are the opportunities on the market?
• How big is the market demand?
• Evaluations of Porter’s Fiver force analysis and SWOT analysis.
• How is the market environment, e.g. competition and price position?
• What is the start-up cost?
• Break-Even analysis.
• What is the estimated return.

The main purpose of Euphoria GYM is to meet the needs of the inhabitants for a
quality fitness center, fitness center which is customer driven with the goal to
help those that are in bad physical state to get started in changing their life for
the better.

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 1.1The genesis of the project
All my life I have, by those closest to me, been considered to be hyper active and
through sports I have found a place where I can blow off all my extra energy.
When I was young, I started training Taekwondo and did all to the age of my
adolescent. By then I had tried badminton, basketball, volleyball and athletics.
Later on, I gain interest on gym, physis and I started training at the gym in, it came
to my attention that the fitness center was not big enough for all those that
wanted to train, especially at the rush hours. I have carried the idea in my
stomach that one day I could open up a new fitness center in to meet the
requirements of the people.
The demand has increased these passed years with inhabitants in Pokhara. This
increase, among other factors, has furthermore increased the pressure for a new
fitness center in Pokhara.

2 Research methods
2.2Method
To write a business plan as efficiently as possible it is important to follow certain
regulatory framework. The framework which is defined in the book Principles of
Marketing by Philip Kotler, a framework which has proven to be good to use. On
the research process here below the five steps, that make the framework, are
defined.
Figure 1 The Research Process (Philip Kotler, 2008)

Define the Develop a Collect Analyze the Interpreting

Research Objective Research Plan Information Information and Report
Findings

The first step is the most important one and can prove to be harder than
expected to define.
But in this case the research objective is:

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 Business plan for a Euphoria Gym in Pokhara.
Next step is to develop a research plan, explain and outline what kinds of data
and sources are needed to develop this business plan. The third step is the
collection of data. Data collected is mostly based on secondary data. Secondary
data is information that has been collected to be used in another purpose than
making of this business plan (Philip Kotler, 2008). The author relied mostly on
sources from textbooks taught at Bifrost University, reports made and published
by institutes and the welfare ministry, reliable sources on the internet and more.
Secondary data was utilized because it was relatively easy to come by and at a
low cost. All attendance and sales in the financial plan are derived from
estimations based on secondary data. Primary data was also collected to some
extent by going to the fitness center already located in Pokhara and see how
spacious and crowded it was. Primary data is the data which is collected to help
directly in solving the problem at hand. When all data had been collected it was
reviewed and exanimated with a critical point of view . When all four steps are
done the fifth and final step is to interpret and report findings. In the conclusion
chapter all findings and other valuable information is drawn together into the
outcome of the project.
2.3 Objectives of the business plan
The objectives of this business plan are to make cost analysis and to show with
numerical conclusion if there is a market for running a fitness center in Pokhara
with considerable profits. The objective is also to use this business plan to apply
for funding from financial institutes, such as banks and financial services and also
potential investors, there is if the plan pans out to be profitable.
Located in this business plan are all core functions of the business in areas such
as general operations, marketing and financial planning.
2.4Short comings
• Legal matters were not looked.
• The numbers that the calculations are built on are estimations.
• Hard to estimate sales without market research.

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3 Executive Summary
The main purpose of this business plan is to examine if there is a market in
Pokhara for a new fitness- and CrossFit center. While observing the fitness center
in Pokhara it came to the authors attention that many customers had to wait for
the equipment they were about to use for some time. Indicating that the present
fitness center in Pokhara has become saturated and thus arousing the question if
there is not a market in Pokhara for any fitness centers. The main purpose of
Euphoria GYM is to meet the needs of the inhabitants for a quality fitness center.
A fitness center with all the latest equipment which will offer CrossFit courses, but
CrossFit is becoming one of the most popular sports activities in Nepal today.
What will make this company competitive on the market is the combination of a
fitness- and CrossFit center which is not available in Pokhara. The company places
rich emphasis on the fact that its staff members are highly qualified and fully
capable to take care of high demands of the customers. The CrossFit center is
relatively cheaper in cost of equipment and will be able to service around 50
people at each course. The facility needs to be able to meet minimum
requirements of a fitness center. In start-up funding for the facility there is
accounted for shower- and locker rooms and other minor expenditure. The
financial funding will be acquired through a loan and investment from investors.

4 The Company, business field and industry

4.2 The business idea

Euphoria GYM will quench the thirst of those demanding a new and better fitness
center in Pokhara. By running those centers in a unified harmony, the hope is that
center will weight up for the cons of the other. The Fitness Center will be fully
equipped and able to serve as many as 70 to 80 people at a time. The Fit
instructors will be located at the fitness center to give advice and help those that
need to get started. The Fit Center will be equipped to serve as many as 50 to 70
customers at once. At minimum there needs to be one instructor at sight to
manage the classes.

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4.3 Fundamental Objectives of Euphoria GYM
Euphoria GYM‟s policy is to have qualified employees who create great customer
value and have the opportunity of further increasing their knowledge at Euphoria
GYM.
- Provide spacious facility with quality equipment to meet high customer
demands.
- Create customer value through high quality service.
- Build up a strong brand name.
- Create an element of uniqueness through combination of Fitness- and
CrossFit Center.

4.4 Opportunities on the market and vision

Euphoria GYM‟s target market has been increasing over the past decade. There
has also been an increased awakening among the Nepal government about
bad physical state of its citizens and increase healthcare cost as a result. Euphoria
GYM could use that as an opportunity to try to get funding from the government
by target those that are in bad physical state and help them get started with the
support of professionals. Which would in the end lead to decrease in healthcare
expenditure for the government.

4.5 Uniqueness of Euphoria GYM

These factors are what make Euphoria GYM unique on the market in Pokhara.
- Available cards for subscription, three-month, six month or one year
subscription cards.
- Customer guidance through the beginning phase of exercising

5 Market analysis
The marketing chapter is one of the most important chapters in the business plan.
His role is to present important information about how the company’s best
interests are attained. Important objective of the market chapter is to explain
how to react to the market conditions.
A businesses performance is based on how well the company can carry out its
marketing plan at the market it is on.

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 5.1 The Market Demand
With technological breakthrough and social changes these past decades exercise
has become less and less of an unconscious activity of our day to day lives. Our
culture has moved from labor intense work over to sitting in front of computer
screen barely moving at all. This has lead Nepal and other western countries to
not move enough at their jobs and have to seek out alternatives in exercise like
attending courses of Fit or training at fitness centers.
Euphoria GYM fitness- and CrossFit center will have an age limit of 16 years.
Therefor the market size is all of those that live in Pokhara from the age of 16 and
over. From the year of 1998 to 2011 the population of 16 years old and older in
Pokhara has gone. This is a 24% increase in the market size or around 1,7%
increase a year. The past five years there has been a 10% increase in this market
size, the population has gone from 4.507 in the year 2007 to 4.983 in the year
2011. From this it is possible to draw the conclusion that at the end of this
marketing plan, which is five years, the market size could be around 5.4 individual
as can be seen on Population in Pokhara 16-year-old and older here below. Year
2012 to 2016 are estimations based on 1.7%increase a year.

5.2 Fluctuations in demand

In this industry, like many others, the market demand is seasonal. Every January
there is a boom in sales of membership cards at health clubs due to weight
gaining over the holidays and New Year’s resolutions. Then sales decrease
somewhat and then pick back up around April those that bought annual cards in
January and have not been using them start coming again and new members join
as well. Over the summer business is usually slow and customers use substitute
activities instead of going to the gym like football, basketball, bicycling,
motocross, mountain climbing etc. Then in September there is another boom in
sales of fitness cards which slowly decreases until they pick back up in January.

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 5.3 The market environment
Euphoria GYM’s employees have to be aware of constantly changing
environment. The nature of the fitness industry is that it is constantly changing
with new technology breakthrough and understating of the human body. The
employees need to be able to provide the costumer with the information and
exercises he needs. It is crucial to be aware of trends that come and go and be
able to adapt to new methods quick. These changes in the market environment
can be managed by going to expos and by keeping an eye out for new routines
that seem to be coming popular.

Barrier to
entry
5.4 Porter’s Five Force
Analysis
To be sure that the competition is not
Customer Competitor Threat of
defined to narrow the Porter’s Five Power Rivery Subsituted

Force analysis, created by Michael E.

Porter, is used. It gives an
understanding of the competitive
forces and their underlying causes, Supplier
Power
reveals the roots of an industry’s
current profitability while providing a
framework for anticipating and influencing competition over time

Figure: Porter's Fiver Force Analysis (Porter, 2008)

(Porter, 2008) it is crucial to define the competitive forces and shape them in a
company’s favor while creating a strategy.

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 ➢ Threats of New Entrants
The threat of new entrants is always at hand if there is a possibility of a profit. But
start-up funding and fixed cost is high for a fitness center.
These are factors that could have an effect on possible income of new entrants:
- Expensive to enter the industry.
- High Capital requirements.
- Economies of scale.
- There is a Low customer switching costs.
- Easy access to fitness equipment distributes.
➢ Power of Suppliers
The power of suppliers in the fitness industry is relatively low. There are many
suppliers that offer comparable products and thus hard for one supplier to drive up
the prices and also relatively easy for the buyer to switch brand name. The fitness
industry is not so much dependent on their suppliers because in the beginning
there usually is one big order of equipment and which brand you choose then is up
the supplier that offers the best quality equipment for the most reasonable price.
Other factors that Euphoria GYM should be aware of are:
- There are many suppliers of fitness equipment around the world.
- Easy to substitute one product with another.
- Similar quality products.
- Switching to another product is easy and cheap.
- Customers could become accustomed to the suppliers‟ equipment.
➢ Power of Buyers
– The power of the buyer should not be underestimated. Even though in this
industry are many small buyers it is not that big it can take customers
dissatisfaction. When customers have been acquired it is important that Euphoria

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GYM will create customer satisfaction through value chain. The companies that
Euphoria GYM intends to market through business-to-business marketing could
tough have power over the price thus they will receive discounts of prices to
encourage them to use Euphoria GYM‟s services.
- Many small buyers.
- The larger buyers get discounts etc. b-2-b marketing.
- Buyers have the ability to switch for a low cost.
- Bargaining leverage of the customer due to high fixed cost at Euphoria GYM.
➢ Availability to Substitutes
– Health industry is not just based on fitness centers and CrossFit
centers. There are many substitutes for what Euphoria GYM offers.
- Many substitute activities available in such as football, basketball
etc.
- Relatively cheap and easy to substitute.
- If price increases rapidly at Euphoria GYM, it is more likely that the
buyers substitute the membership cards for other activities.
➢ Competitive Rivalry
Competitive rivalry in Pokhara right now is quite low, there is one clear
market leader, Bro Gym which has its prices relatively lower than those in
Pokhara and are probably unable to meet increased competition on the
market with price reductions.
- Few competitors.
- One clear market leader.
- Low switching cost.
- Similar quality products.
- The market leader unlikely to expand.
Company Description

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 5.5 Situational Analysis
SWOT Analysis
The following is the list of strengths, weakness, opportunities and threats of
Euphoria Gym. We will use this to maximize strengths and opportunities and to
minimize weakness and threats. It is important recognize and promote awareness
throughout or company ensuring that everyone strives towards the same goals.

INTERNAL FACTORS STRENGTHS WEAKNESS

• Trademark Judgment • Member do not

Free Zone philosophy currently have the option
that attracts the average of group exercise classes
person, not the body
builder (larger
demographic population)

• Clean, stylish, hassle- • Members do not have

free facility the have the option of
using a pool or outdoor
Product/ Service • Flexible hours workout facilities such as
– Monday 12am through tennis and basketball
Friday 10pm, Saturday quarts
and Sunday from 7am to
7pm • Alienates the
• No long-term bodybuilder, and other
commitment required people that do not abide
• Variation in types of by the Judgment Free
memberships (Black Card Zone rules
and White Card)

• Black Card Membership

offers additional benefits,
such as unlimited

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 tanning, admission to any • Do not provide on-site
location, and the ability extras such as a
to bring a friend at no steam room, child care,
cost juice bar, and so on that
competitors provide
• Free personal training
• Plenty of brand-name
cardio and strength
equipment for use during
peak busy periods

• Payment is
automatically deducted
monthly from member's
bank accounts

• Facility is simplistic, a
place to work out without
distraction

• Facility provides locker

rooms and clean shower

• Low monthly
membership cost

• Low annual • Yearly membership fee

membership cost regardless of numbers of
Price compared to competitors months members use the
facility.
• No startup fee for Black
Card Membership

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 • Many methods of • Some advertising
reaching target market. methods are expensive

PROMOTION • Many of the advertising • Ads can often be

methods are very overlooked due to the
inexpensive. large volume we see each
day.

EXTERNAL FACTORS Opportunities Threats

Other gyms don't offer • Other area gyms offer

the Judgment Free Zone more variation in exercise
Competition philosophy types such as, group
Other Gym Wellness classes and a pool
Center is closed during
holidays.
• Getting fit is a popular• Seasonal customers
trend that is very may be reluctant to pay
influential in our societyfor a summer
membership when
• Many people have new outdoor sports are
Social/ Economic year's resolutions to get popular.
fit and lose weight

• In a slow economy low

price are important to
consumers

• The Judgment Free

Zone policies will attract
people who would not
otherwise join a gym

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6 Marketing Strategy
By planning in advance companies are able to expect and react more quickly to
abrupt changes in the market place.
‘’Failing to plan means planning to fail.” (Philip Kotler, 2008)
6.1 Objectives and issues
Euphoria GYM’s objective is to target its market segments. These segments will be
reached through local media in Pokhara e.g. Nepal television, Durdarsan,
advertisements at schools, restaurants, on the internet, B2B marketing and with
bargain prices.
Before Euphoria GYM could go into business the author would recommend that
there would be made market research. Management of companies more often
than not is all about taking decisions which are surrounded by uncertainty and
sometimes with high risk factors. With marketing research managers can limit
these uncertainties and limit the risk to some degree, but of course it is impossible
to erase them completely (Philip Kotler, 2008). This marketing research would not
have to be expansive and would involve a questioner which would be either
brought to a random sample out of the segments via telephone or e-mail. With this
market research the founders could determine what might be needed in Pokhara,
how many of customers would come over to Euphoria GYM‟s facility and possible
market opportunities.
It is also important that Euphoria GYM‟s management continues to conduct these
market researches once the company has been established to answer questions
like are the customer’s needs and requirements changing and if so, is the company
able to meet these changes in demand.
6.1.2 Fitness Center market objectives:
Even though the market objectives are based on reaching percentages of sales does
not mean that Euphoria GYM will only be taking customers from but also creating
new customers through business-to-business marketing and offering multiple
payment agreements as well as trying to target those that are considered to be in
a bad physical state. sales are only used as base.

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• Objective for first year of operation –
Euphoria GYM fitness center will have 8% of market share at the end of first year
operation
• Second and third year of operation –
Euphoria GYM fitness center will increase its share to 12% of market share at year
two of operations and increase to 15% of total sales, except for the annual cards
sold which had double in sales from the year.
• Fourth and fifth year of operation –
In the end of Euphoria GYM‟s fitness center five year plan the objective is to have
reached 19% of total sales. Going from 15% share in year three to 17,5% in year
four and 19% market share in year five of operations.
6.1.3 CrossFit market objectives:
There are no sales figures available from Boot Camp in Pokhara estimations had to
be made for sales to the Fit center. Objectives were drawn from the total occupants
the Fit center could have, which are approximately 50 individuals at a time.
Euphoria GYM‟s schedule will have at minimum three classes a day and three
courses over the year. Taken all these aspects to gather Euphoria GYM‟s can have
450 practitioners at maximum in their facility over one year period. Euphoria GYM
sells annual cards, cards for six and three months so it is possible to have cards that
last for longer than one course thus 450 people had to be divided with two, to
ensure that none is double counted, making maximum practitioners around 225
people a year.
• Objectives for first year of operation – Euphoria GYM‟s objective for the first year
of operation are to have 12% of its maximum practitioners. Single tickets sold are
estimated to be 8% of the maximum practitioners. The estimation suggests that
70% of those that join Euphoria GYM‟s courses will have to go through introductory
training, this percentage will decrease by 25% each year and end up in 10% as a
base.
• Objectives for second and third year of operation – Euphoria GYM‟s will increase
its sales to 15% of its maximum practitioners in the second year of operations and

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17,5% in the third year. Estimations for singe tickets sold will increase from 8% to
12% in the second year and from 12% to 15% in year three
• Objectives for fourth and fifth year of operation – In the end Euphoria GYM‟s five
year plan their objective is to have reached 21% of its maximum practitioners.
Going from 17,5% in year three to 19,5% in year four and in year five reaching 21%
client base from their practitioners’ maximum. School membership objectives,
fitness. Same objectives apply for the school membership cards as those listed
above. The only difference is in school cards sold at the school cards are estimated
to be half the sales of those in the Fit center.

6.2 Segmentation
The objective is to appeal to as many as possible. But by dividing the total market
into segments it is more efficient to customize a marketing strategy to target those
segments. Euphoria GYM will offer special school discount on membership cards to
more extent that is doing thus one segment will include all of those that attend
school from the age of 16 to 25. With better physical state of the human body, it
decreases possibility of illnesses and increases labor performance thus mutual
gains for both parties. Other corporations with many workers will also be
considered as possible market, such as the hospital in Pokhara. Euphoria GYM will
also target those that are in bad physical state and need guidance to get started.
By targeting this segment Euphoria GYM could create many new customers. It is
the authors hope that by targeting this segment Euphoria GYM could probably
apply for Governmental funding.
The third and segment will be all of those from the age of 16 to the age of 35 that
live in Pokhara and do not fall under the other two segments. This age group is the
likely to have membership to a Fitness center.

The segment size is all of those that have reached the age of 16 and to the age of
35. As we can see on graph five Populations from the age of 16 – 35 here above
there has nearly been a steady increase in this demographic.

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6.3 Marketing strategy
Euphoria GYM‟s marketing strategy will be customer driven, the main focus is to
delivering more value to the customer than the competitors are doing and that is
how Euphoria GYM will position itself “more-for-more”. Euphoria GYM will offer
their customers more spacious facility and better-quality equipment, at slightly
higher prices. The Fit instructors will help all of those that want to get started by
building an exercise program for them.
Main purpose of Euphoria GYM ‘s marketing strategy
• Increase sales.
• Publish and promote the company and its services.
• Increase demand for the service that Euphoria GYM provides.
• Build up and establish Euphoria GYM as a brand name.
• Help those that need to get in better physical state.
How will this be implemented?
• Through advertisement in the media.
• Business-to-business marketing e.g. marketing Daraz.
• Through public relations by encouraging the employees to be active in writing
articles on the internet, build up good corporate image.
• Through co-operation with the hospital in Pokhara and/or the government.
6.3.1 Advertisement Channels
- Environment advertisement.
Advertisement in stores, restaurants and theaters.
- Brochures and other printed material, flyers.
– Internet

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Euphoria GYM will have its own web page where special offers will advertise.
Euphoria GYM instructors and others will write articles about health and other
interesting material on the web creating a conversation about Euphoria GYM.
6.3.2 Personal Selling
Euphoria GYM‟s business-to-business strategy will be reached through personal
selling. The business market usually buys in bulk and thus a greater deal of
importance that this market is reached successfully. This strategy will be
implemented to reach the workers of the heavy industry factories outside of
Pokhara.
6.3.3 Public Relations
Public relations can have a strong impact on public awareness at a much lower cost
than advertising can. Euphoria GYM will encourage its staff to write articles about
exercise and healthy lifestyles for websites. This will hopefully increase awareness
about Euphoria GYM at a lower cost than advertisement.
6.3.4 Pricing
In the economy today it is hard to believe that customers are willing to pay more-
for-more. With Euphoria GYM‟s multiple payment agreements it’s more likely to
attract customers that are willing to pay more in total but with payment
agreements. Euphoria GYM‟s price listing takes account of the prices that charges
at their facility.
This price position is selected to be competitive against low prices but still able to
provide high quality services. The prices are positioned a bit higher than Boot Camp
prices and that is justified in the light of those that buy CrossFit cards at Euphoria
GYM will also gain access to the fitness center.
6.3.5 Innovative in thinking
Because of the fluctuation in demand and summer being the slowest time for the
fitness industry Euphoria GYM will try to increase its sales on membership cards by
offering children’s classes in the summer motivating the parents to come to
Euphoria GYM as well. For some parents the summer time is inconvenient for
attending courses of any short because they need to be home with their children

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which do not have schools to attend to. Other measures could also be implemented
to try to keep the demand as steady as possible.

7 Location and Production Factors

There is no use in offering any kinds of service if the customer is unable to reach it.
Location is important for businesses especially where clients have to come every
day. A good location is a great advertisement and curious encourager.
7.1 Location and equipment
Location of the company should be decided on factors like good and visible
accessibility, comfortable for the customers and the cost of establishment of the
company at set location. If the company is at a good location, it will be a constant
reminder for possible customers of its presence thus good advertisement.

7.2 Employees:
Part of Euphoria GYM‟s business is service oriented. Its employees, e.g. the
receptionist and the Fit instructors, are interacting with the customers and creating
value. In hope of adding as much customer value to the business as possible it is
crucial that the employees are highly qualified and get support from the company.
“Successful service companies focus their attention on both their customers and
their employees.”
(Philip Kotler, 2008)
To do this Euphoria GYM has to follow and understand the service-profit chain
which consists of five links;
1. Quality work environment – qualified employees with strong support from the
company which leads to 2. Happy and loyal employees which are more productive
which leads to
3. More service value – more efficient value creation in service delivery which leads
to

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4. Happier customers and happy customers stay loyal and keep buying the product
and recommend it to their friends which leads to
5. Steady and healthy profit increase and service performance
(Philip Kotler, 2008)

7.2.1 Advanced learning

It is important that Euphoria GYM‟s employees take part in and benefit from
advancing in their education. Advanced educations can be in the form of:
• Courses that are structured to meet the employee’s needs.
• Book reading or information gathering from the internet about specific matters
• Participants in conferences, meetings and other activities which further
increase advanced learning of specific employees.
7.2.2 Job description: -
➢ Managing director.
Euphoria GYM needs to be run by someone that has experience in business,
preferably someone with an education in business administration. Former
experience from running a similar business is required. The role of the managing
director is to supervise all factors of the business and observe if everything is
running according to schedule. His role will also be to see that the customer
satisfaction is met and goals for market size are sustained. The managing director
will also have to be able to instruct Fit classes or other jobs that need to be
attended to. –
➢ Fit instructors.
There will be three Fit instructors which will divide the workload evenly between
each other. Fit classes will be at all hours of the day on week day. These trainers
will have to have Fit level 1 instructor certificate and preferable some other
education that will help them in their line of work e.g. level in Kettlebell
instruction or B.Sc. in sports science. It is crucial that there are qualified CrossFit

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instructors. They will also be obligated to help clients to get started. Prepare for
them an exercise program and show those who want around the facility and
teach them how to work each equipment. This will hopefully help Euphoria GYM
to be compatible on the market and encourage those that have been wondering
about getting started to get started in the hands of a professional.
➢ Reception / customer service.
There will be four receptionists / customers service positions all working half a
day. Or one receptionist with a fulltime job and the other two have a part time
job. Their main occupation will be to answer the phone and help those that want
to do business with Euphoria GYM to sign up. Their educational requirements are
minimal but they need to have service motivation and able to take initiative. On
the side when there is a down time they can clean around the facility. There has
to be at least on receptionist of each gender to be able to clean the shower
rooms. Cleaning will be written in their employment contract. –
➢ Maintenance.
At Euphoria GYM there is a lot of equipment that needs to be attended to on a
regular basis. The equipment has many movable parts that need to be lubricated
to minimal wear and tear. The customers‟ demands that the equipment that he is
intending to use will be working at its optimal so it is important that there is
someone that will be able to fix the equipment right away. There is a possibility
that there will not be a person in maintenance on payroll but instead hire a
contractor whenever something breaks. But will be included as staff member in
the income statement.
7.3Wages
Minimum wages for a full-time job, 17500 worked hours a month shall be as here
is noted for employees 18 years of age or older and have worked for four months
straight at the same employer. The table Employment Wages calculates the base
salary and does not take into account the 5% increase in wages.

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8 Corporate structure and Human Resource Management
Operation form Euphoria GYM will be registered as a Ltd. (private limited
company) to minimize all expanses in funding the company and also to minimize
the capital requirement. The company will be registered and the registration fee.
Minimum share capital for Ltd. is 500.000. and will be submitted by Euphoria
GYM‟s founders. The company will pay 20% income tax.
Human Resource Policy
Euphoria Gym creates customer value through service and thus has to have
qualified employees. Employees which are self-motivated and inspired to do well
for the company and its clients
. • Employees that are able the take initiative.
• Employees that are motivated to do good for them-selves and the
company.
• Productive employees with thirst for more knowledge in their line of
work.
• Employees who are able to write articles about fitness and health in the
media.

9 Operation Plan
The operation plan shows estimations of cost, income and performance of the
company. The operation plan goes through all the expanses and income that the
business occurs in its process. All the expenses and income are based on
estimations from the business plan.

9.1 Operating Cost

Cost can be divided into two types of cost, fixed cost and variable cost. Fixed cost
does not change with quantity produced or total sales made even though sales or
none it remains the same. The variable cost does change in proportion with
quantity produced or total sales made.

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 9.1.2 Fixed Cost
• Rent
• Heating and water expanses
• Telephone and internet
• Royalties
• Cleaning appliances and products (Including dispensers, tissue dispenser,
soap dispenser etc. those expanses will be accounted for in initial
investment).
• Computer system operation.

9.1.3 Variable Cost

• Discounts and other price reducers: 10% of the income from the fitness
center and 5% of the income from the CrossFit center will be marked as
expanse on the count of not all those that will come to the facility will pay a
full price of the cards, e.g. those that get their cards at a discount or through
marketing implementation.
• Wages
• Marketing and advertising:
• Other unforeseen expanses: 5% of the income will be used to meet
unforeseen expanse.

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10 Start-up costs

Decoration
10000 1 10000
Carpeting
600 5 3000
Curtains
1000 2 2000
Pictures
and frames
15000
Total decoration equipment’s

Office Equipment

Computer set
30000 1 30000
Desktop
45000 3 135000
Laptop
25000 1 25000
Printer
1 5000
Others 5000
equipment’s
195000
Total office equipment’s

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 Description Rate
Furniture and fixture
Counter Desk 8,000
Chair:
Normal 13,500
Arm chair 7,500
Working Desk 12,000
Visitors table 4,000
Visitors Sofa 8,500
Inverter/ battery 60,000
Water Dispenser/filter 4,500
Total furniture 118,000

Other beginning cost

Description Amount Rs
Business Register 4100
Legal expenses 4000
Decoration expenses 15000
It expenses (website development) 60000 Preliminary
expenses
Total 83100

Preliminary expenses
Year 1 Year 2 Year 3 Year 4 Year 5
16,620 16,620 16,620 16,620 16,620 Preliminary expenses
written off
66,480 49,860 33,240 16,620 - Book value

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 Preliminary Expenses Write Off

Start Up costs

Particulars Amounts (Rs)

Office Equipment 195,000
Furniture and fixtures 118,000
Preliminary expenses 83,100
Total cost 396,100
Cash in Hand 503,900
Total fund needed 900,000

The total start off costs for the business is NPR 396,100. These costs are
estimated based on prevailing market rate of the assets and equipment’s.
Preliminary expenses are NPR 83,100 which are written off equally for 5 years.
The fund required is 900,000 and minimum cash in hand is NPR 503,900.

Particulars Amount (Rs)

Equity (40%) 360,000
Debt (60%) 540,000
Total Capital 900,000

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CONCLUSION
It is not an easy task to start up a new business as if market is a playground
for all of us. We need new ideas, executes the plans through different
methods, channels and processes and take it into action.
Our business lies in our own expertise, our loyal customers and our staffs to
give hand-in- hand advice and help for serving the customers. In case any
aspects have been missing out from these few listed features, our business
won’t hesitate to downfall. We know that attracting new customers from
our competitors isn’t an easy thing. But the effort we haven’t made won’t
be in vain. We must include best of best quality services for our clients with
the reasonable price and try to innovate new products in the service line.
Euphoria Gym will ensure to deliver best services to their clients and listen
their views as well as. Not for customers we will also follow a healthy
working environment for our staffs and suppliers to prevent low turnover.
With the latest updates, we Euphoria Gym will try to cope with the trend or
create as new trend setter. Keeping in mind, is established for profit motive
so I convey in having maximum return (profit) from our services.
Collectively, this market report plan has structured a conceptual approach of
business strategic objectives and mission to provide maximum service for
our client’s happiness. In case, any problems may rise during our business
cycle we will try to proposed new approaches or solutions.

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