Afghan Fitness Club

Group Assignment
Entrepreneurship

Sir Usman Ali.

Assignment No.2 Page 1
Afghan Fitness Club

Name: Registration ID:

1. Sayed Mahmood Hashimi 302-1704038

2. Mohammad Ismail 302-1704005

3. Malina Sadeed 302-1704010

4. Matiullah 302-1704029

5. Asma 302-1704016

Subject: Entrepreneurship

Lecturer: Sir Usman Ali

Assignment No: Two (2)

Term: G1

Assigned Topic: Business Plan

Lecture Day: Tuesday

Time: Evening

Best Regards,

Sincerely Yours Students.

Assignment No.2 Page 2

Afghan Fitness Club

Afghan Fitness Club Business Plan

2018

Kabul, Afghanistan.

Assignment No.2 Page 3

Afghan Fitness Club

Contents
Executive Summary ......................................................................................................... 5
Business Description......................................................................................................... 5
Mission: .......................................................................................................................... 5
Vision: ............................................................................................................................. 5
Product and Services ........................................................................................................ 5
Benefits and Features........................................................................................................ 6
Basic Information ............................................................................................................. 6
The Market ...................................................................................................................... 6
Strengths and Core Competencies ..................................................................................... 6
Challenges ....................................................................................................................... 6
Market Opportunities ....................................................................................................... 7
Barriers to Entry ............................................................................................................... 7
Service Potential ............................................................................................................... 7
Competition ..................................................................................................................... 7
Market Niche ................................................................................................................... 8
Marketing Strategy ........................................................................................................... 8
Branding .......................................................................................................................... 9
Marketing Objectives ........................................................................................................ 9
Strategy ............................................................................................................................ 9
Marketing Budget ............................................................................................................. 9
S.W.O.T Analysis .......................................................................................................... 10
Graphical Presentation of S.W.O.T Analysis................................................................... 11
Place .............................................................................................................................. 11
Promotion ...................................................................................................................... 11
Management Team ........................................................................................................ 12
Operations ..................................................................................................................... 12
Financial Section ............................................................................................................ 13
Thanks A Lot. ................................................................................................................ 18

Assignment No.2 Page 4

 Afghan Fitness Club

Executive Summary

Business Description
Afghan Fitness Club is a unique fitness facility with a strong focus on providing
practical lifestyle enhancement to its members in an upbeat, friendly, yet adult-
oriented atmosphere. As a first-class exercise facility, the company promises to
deliver the highest level of personal service and attention to its members.

Mission:
To provide strategies and training programs related to health care.

Vision:
To create and maintain awareness about healthy lifestyles and its benefits.

Product and Services

Afghan Fitness Club provides its members with the latest in fitness and martial arts
techniques. From group or corporate, to individual training, the company will
customize specific programs geared for all fitness enthusiasts, from beginners to
professional.
Fitness programs offered include:
A group fitness training program geared to groups of
Tone & Fit individuals seeking to be motivated by those within the group.
A private training program uniquely designed for clients seeking
to find their fitness comfort zone through personalized, one to
Private Fit one training, in a stress free, structured environment. Semi-
private sessions for 2 and 3 participants are also available.
Boot Camps An intensive fitness and weight loss program geared to
individuals superior results.
A personalized training program designed with the group's
Private Group Fit overall fitness goals in mind, whether it's weight loss, muscle
tone, flexibility or a combination.
A type of Private Group Fit that is designed specifically for
Corporate Fit corporations. Customized and appealing to clients in both large
and small corporate societies.
A fully graded Karate program designed to get the participants in
Karate Fit shape while developing overall mind body discipline and, at the same
time, participants have fun.
Yoga Control Using the Hatha Yoga methods, the programs are designed to
provide strength, flexibility and relaxation.

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Afghan Fitness Club

Benefits and Features

 State of art faculty with latest equipment form quality manufacturers.

 Lowest cost with monthly, quarterly and annual subscription plans.

 Personal qualified trainers to help our members achieve results without wasting
much time.

Basic Information
Technology: State of the art fitness Equipments
Location: Kabul, Afghanistan.
Product/Service: Fitness Services.
Target Market: All segments (Young, Adult and Mature clients)
Employment Generation: 20 employees including fit and qualified trainers and other
staff.
The Market
The Health and Fitness Industry has been experiencing tremendous growth for a
number of years in Afghanistan, with revenues totaling approximately 2,000,000
million USD in 2017. Total memberships in 2017 were approximately 130,000.
Personal training continues to be the strongest growth segment of the fitness
industry. This trend is expected to continue as personal trainers expand their
services beyond a general exercise program.
Strengths and Core Competencies
 Lowest cost of services in comparison to competitors.

 Certified trainers from top ranked health care institutions.

 Owner’s commitment and dedication towards health care services.

Challenges
Afghan Fitness Club will face a challenging situation in creating its brand image and
attracting customers towards their services due to presence of already established
players in the local market such as:

 UK Fitness Club
 Nekpa Fitness Club
 Power House Fitness Club

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Afghan Fitness Club

Market Opportunities
Health care club industry offers a huge lot of opportunities for existing and potential
Investors. Marketing is growing for many reasons, some of them are following:
1. Almost 300 million people are affected worldwide with obesity.
2. Almost 60% of Afghans are overweight.
3. 20% children’s in Afghanistan are overweight.
4. 50% million Afghans with diabetes are suffering from high blood pressure and
Heart diseases.
6. Treatment cost of obese patients is almost very high.
Barriers to Entry
There are no such barriers in Afghanistan for the entry of fitness clubs.

Service Potential
Currently Afghan Fitness Club is only focusing on developing a fitness and health care
facility, but in the future they are planning to extend its operations for creating public
awareness about different disease and heath care issues on no profit basis.
Competition
Afghan Fitness Club will enter in a highly competitive market of Afghanistan, but following
three will be the direct competitors:

1. UK Fitness Club
Gul-e-Sorkh Square
Kabul,Afghanistan
Services offered: Fitness Consultation, Personal Training, 30 Day Makeover,
Intense 30 Minutes, Adventure BootCamp, Home Workouts and Fitness
Equipment.
2. Nekpa Fitness Club
Roshan Plaza, Kot-e-Sange
Kabul, Afghanistan.
Services offered: Core conditioning, short distance running (less than one mile),
Muscular strength, jumping rope, circuit training, hiking, sport yoga, fitness kick
Boxing, Pilates, sport drills and obstacle courses.
3. Power House Fitness Club
Silo Street
Kabul, Afghanistan.
Service offered: Strength training/cardio, diet and nutrition, group exercise of
Spin, yoga, Pilates and many others, fitness related medical information, sports
Training, senior fitness, youth fitness, pre and post natal.

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Afghan Fitness Club

Market Niche
Afghan Fitness Club will enter in the market to serve low income segment of customer
that forms more than 45% of total population in Afghanistan who are earning less than
$10,000 per annum.
Afghan Fitness Club will provide low price services in the start to attract masses, and
eventually Set it to competitive rate.

Marketing Strategy
Value Proposition:

 State of the art facility with the latest equipment form quality manufacturers.

 Low cost with monthly, quarterly and annual subscription plans. Starting from as
low as $ 80 for basic body workout exercises.

 Personal qualified trainers to help our members achieving results without

wasting much time.

Personal
Trainers
State of the
Low cost of
art health
Subscription
care facility

Value

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Afghan Fitness Club

Branding
Afghan Fitness Club will create their official website for creating a brand and company
image in
the market, as well as providing subscription online.

Marketing Objectives
Afghan Fitness Club will focus on creating a brand image in the Coral Gables vicinity.
They will
Participate in the major events of health care awareness and education programs.

Strategy
Afghan Fitness Club will start by targeting low income segment of market downtown
Coral Gable area. They will convince people about the benefits and needs of wellness
programs. This will be accomplished by aggressively pursuing interaction and
relationships with peoples in public health awareness programs and by sending
newsletters and emails through website.

Marketing Budget
Afghan Fitness Club has allocated $5,000 for marketing in the year 2018. This budget
will be used for advertising on newspaper, television, radio and printing brochures.

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Afghan Fitness Club

S.W.O.T Analysis
Strengths:

 Management committed towards a result oriented approach to attract and

maintain customers in a highly competitive market.

 Health care program is well-thought according to the layman.

 Lowest cost of service in the entire market of Kabul.

 Company will hire qualified and trained staff.

Weaknesses:

 Personal training services can be high in costs.

 Afghan Fitness Club is low in staff that can be a problem in providing services to a
large pool of members.

 The club is short of marketing budget to attract large business clients.

Opportunities:

 Health care club market is rapidly growing.

 Increasing heart and obesity disease are causing people to pay importance to
exercise and health care activities.

 People are getting used to have gym and health clubs in their daily routine of life.

 A large segment of market is still untapped, low income area will be of special
focus for Afghan Fitness Club which is totally ignored by the rivals.

Threats:

 Recession and economic downturn can slow down the growth of health care
clubs.

 Low cost offer from well established competitors. Although it’s a small level
threat due to a fact that market is rapidly growing.

 Low cost health care equipments availability for home exercise.

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Afghan Fitness Club

Graphical Presentation of S.W.O.T Analysis

Helpful Harmful

For Achieving the objectives For Achieving the objectives

Internal Strength Weakness

 Lowest Price  High Cost of Personal

Training Service
 Management of health
care experts  Low in Marketing Budget
and Staff
 Qualified and Trained
Staff

External Opportunities Threats

 Rapidly Growing Market  A possible low cost of

service form competitors
 Obesity Disease is on the
record high  Availability of low cost
health care equipment.
 No competition in the
low

Place
Direct Supply/Direct Sale: Afghan Fitness Club will have their health club facility near
the main street of Parwan-e-Du Square of Kabul city. They will not involve in any kind of
franchise or branch network other than Parwan-e-Du.

Promotion
Media Advertisement: Afghan Fitness Club will use internet, newspapers, magazines,
television and radio as the medium of advertisement. In addition they will print 5,000
brochures for creating awareness in the market about their health care services; they
will be distributed in major health care seminars and events where officials from Afghan
Fitness Club will participate.

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Afghan Fitness Club

Management Team
The management team is composed of the solid experience of Owner 1, a 20 veteran in
the health and fitness industry, a former martial arts and fitness center owner, a
certified personal trainer and second degree black belt recipient in the martial arts of
Karate.

Operations
The day to day operations of Fitness Center Company will be focused on delivering
exceptional group training and personal training services, within a positive and
inviting atmosphere.
The Afghan Fitness Club facility will be approximately 3,000 square feet, and
include adequate workout rooms, office and administrative areas, Locker
rooms, and washrooms/showers.

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Afghan Fitness Club

Financial Section
 Balance Sheet

Afghan Fitness Club

Forecasted Balance Sheet

ASSETS Year 0 Year 1 Year 2 Year 3

Current assets
Cash & Bank 500,000 622,774 859,961 1,212,485
Account Receivables 0 0 0 0
Inventory 0 0 0 0

Total Current Assets 500,000 622,774 859,961 1,212,485

Fixed assets
Land 300,000 300,000 300,000 300,000
Building 1,070,000 963,000 866,700 780,030
Machinery 75,000 67,500 60,750 54,675
Office equipment 6,050 5,445 4,901 4,410
Furniture & fixtures 6,000 5,400 4,860 4,374
Total Fixed Assets 1,457,050 1,341,345 1,237,211 1,143,489

TOTAL ASSETS 1,957,050 1,964,119 2,097,171 2,355,974

LIABILITIES & SHAREHOLDERS EQUITY

Current liabilities
Accounts payable 0 26,875 38,125 50,625
Total Current Liabilities 0 26,875 38,125 50,625

Long term debt (Project Loan) 978,525 978,525 978,525 978,525

Total Long Term Liabilities 978,525 978,525 978,525 978,525

Shareholders' equity
Paid-up capital 978,525 978,525 978,525 978,525
Retained earnings 0 -19,806 101,996 348,299
Total Equity 978,525 958,719 1,080,521 1,326,824

TOTAL CAPITAL AND LIABILITIES 1,957,050 1,964,119 2,097,171 2,355,974

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Afghan Fitness Club

 Income Statement

Afghan Fitness Club

Forecasted Income Statement

Year 1 Year 2 Year 3

Revenue 480,000 750,000 1,000,000

Cost of sales 200,000 300,000 400,000

Gross Profit 280,000 450,000 600,000

General administration & selling expenses
Salaries * 47,400 49,770 52,259
Utilities ** 19,800 20,790 21,830
Distribution Expense 2,400 2,520 2,646
Advertisment Expense 12,000 12,600 13,230
Depreciation 115,705 104,135 93,721
Office Supplies Expense 3,600 3,780 3,969
Insurance Expense 6,000 6,300 6,615
Subtotal 206,905 199,895 194,269

Earnings Before Interest & Taxes 73,095 250,106 405,731

Interest expense on long term debt 97,853 97,853 97,853

Earnings Before Tax -24,758 152,253 307,878
Tax -4,952 30,451 61,576
NET PROFIT/(LOSS) AFTER TAX -19,806 121,802 246,303

Ending balance of Retained Earning -19,806 101,996 348,299

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Afghan Fitness Club

 Cash Flow Statement

Afghan Fitness Club

Forecasted Cash Flow Statement

Year 0 Year 1 Year 2 Year 3

Operating Activities
Net profit -19,806 121,802 246,303
Add: depreciation expense 115,705 104,135 93,721
Account Recivables 0 0 0
Inventory 0 0 0
Account payable 26,875 11,250 12,500

Cash provided by operations 122,774 237,187 352,524

Financing Activities
Project Loan - principal repayment 0 0 0
Additions to Project Loan 0 0 0
Issuance of shares 0 0 0
Cash provided by financing activities 0 0 0

Investing activities
Capital expenditure 0 0 0
Acquisitions
Cash provided by investing activities 0 0 0

NET CASH 122,774 237,187 352,524

Ending Balance of Cash 500,000 622,774 859,961 1,212,485

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Afghan Fitness Club

 Operating Expenses

Year 1
Head Monthly Annually Year 2 Year 3 Year 4
Salaries * 3,950 47,400 49,770 52,259 54,871
Utilities ** 1,650 19,800 20,790 21,830 22,921
Repair & Maintainence 200 2,400 2,520 2,646 2,778
Advertisment Expense 1,000 12,000 12,600 13,230 13,892
Office Supplies Expense 300 3,600 3,780 3,969 4,167
Insurance Expense 500 6,000 6,300 6,615 6,946
Total 7,600 91,200 95,760 100,548 105,575

 Salaries

Position Numbers Monthly Annually

General Manager 1 1,000 12,000
Finance Manager 1 800 9,600
Accountant & Casher 1 400 4,800
Marketing Manager 1 350 4,200
Receptionist 1 200 2,400
Guard 2 150 1,800
Office Boy 1 150 1,800
Trainers 12 900 10,800
Total 20 3,950 47,400

 Utilities

Type Monthly Annually

Electricity Charges 1,000 12,000
Telephone Charges 100 1,200
Gas Charges 300 3,600
Internet Charges 150 1,800
Drink Water Charges 100 1,200
Total 1,650 19,800

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Afghan Fitness Club

 Fixed Asset Estimations

Particulars COST

Land* 300,000
Building** 1,070,000
Machinery & Equipment*** 75,000
Furniture & Fixture^ 6,000
Office Equipment ^^ 6,050
Total Cost 1,457,050

 Land Requirement

AREA IN TOTAL
DESCRIPTION COST/SG.FT
SG.FT COST

Land 3,000 100 300,000

 Building Requirement

AREA IN TOTAL
DESCRIPTION COST/SG.FT
SG.FT COST

2 Office 1000 500 500,000

2 Workout Rooms 1500 300 450,000

3 Wash Rooms 250 300 75,000

1 Café 150 200 30,000

1 Locker Room 100 150 15,000

TOTAL 3000 1,450 1,070,000

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Afghan Fitness Club

 Machinery

COST / TOTAL
PARTICULARS No's
MACHINE COST

Flat Bench 3 6,000 18,000

Incline Bench 3 5,000 15,000

Decline Bench 3 5,000 15,000

Chest Press Machine 3 3,000 9,000

Chest Fly Machine 3 1,500 4,500

Hummer Press Machine 3 2,500 7,500

Cross Over Machine 3 2,000 6,000

TOTAL 21 25,000 75,000

 Office Equipment

Particulars No's Cost Total cost

Core I 7 (window 7 Installed) 3 1,000 3,000

Printer 3 500 1,500

Telephone Connection 5 100 500

Internet connection 1 350 350

Fax Machine with one phone
line 2 350 700

TOTAL 14 2,300 6,050

 Furniture and Fixture

Particulars No's Cost Total cost

Furniture 50 100 5,000

Lighting & Wiring 20 50 1,000

TOTAL 70 150 6,000

Thanks A Lot.

Assignment No.2 Page 18