1

The Extra Mile: Running Specialists

Co-owners: Brendan and Brodin Coughlin

508-867-6231
Bcoughlin2412@yahoo.com

11/30/2016
 2

Table of Contents
I. Executive Summary 3
II. Mission, Vision, and Culture 4
III. Company Description 5
Opportunity Analysis and Research:
IV. Industry Analysis 6-8
V. Environmental Analysis 8-10
VI. Competitive Analysis 10-12
Marketing Strategy and Plan:
VII. Products/Services 13-14
VIII. Pricing 14-15
IX. Promotion 15-16
X. Place 16
Management and Operations:
XI. Management Team and Inventory, Production, and Quality Assurance 17-19
XII. Physical Location and Facilities 19
Financial Analysis and Projections:
XIII. Income Statement Projections 20-21
XIV. Funding Request 21-22
XV. Financial Projections 24
XVI. Appendices 25-26
XVI. Works Cited 27
 3

I. Executive Summary
Our store is The Extra Mile: Running Specialists. We are a specialized retail store
involved in the sale of running footwear, apparel, and equipment/accessories. We are also going
to offer a type of service in putting on various types of road races, but that will not be until later
on. Our target market is very large because of the amount of people that partake in running as a
sport, hobby, or form of exercise. This company will be a partnership between my brother and I,
and we will share it equally.
Our marketing and sales strategy will be interdependent on one another and will be a
huge part of our success. We are going to advertise very heavily in our first year of operation. It
will focus on the trends that have been happening in the running industry. We are also going to
spread our message across various channels including the internet, television, newspaper, and the
radio. Our idea will satisfy various customer needs. Runners need new shoes and new clothes all
the time and they often must go to Worcester to buy new items. Our convenience factor will be
one of our points of emphasis because customers will not have to travel to the city to get what
they need. Other success factors include our huge selection of the best brands, the reliability of
our products, and the unbeatable customer service.
Our short-term business goals are simply to make our store known. We want to attract at
least of our overall target market and we want to create recurring customers. Our primary goal
is to establish a loyal customer base and make enough money to cover around of our initial
investment. The chances that we take a loss for our first year are relatively high. We understand
this, but we are very optimistic about our potential for growth. Our long-term business goals are
to become profitable in the second year. We want to make enough money to cover all our initial
investment, while making a relatively large profit. We hope to have reached almost all our target
market within 5 years and make most of these people customers that are likely to come back.
My brother and I have been runners for all our lives and we have gone through various
forms of running footwear and apparel. We understand that every runner is different and we have
a very capable knowledge of the footwear that is best suited for each running style. The quality
business education that I will receive from Nichols College, along with my brothers ability to
persuade and sell items to people, will be a very successful combination. Our organization skills
will also play a key part in our success. Our funds will be derived from our personal investment
along with a bank loan and an outside investor. These funds will be used to cover all our
expenses and to branch out into any new types of technology and/or industries that will expand
our business. Our financials predict that we will have made a total profit of $100,000 after the
first 5 years. Our fixed and variable costs will either decrease or stay the same and our sales and
profits will rise every year. Our business will continue to grow along with the number of runners
because the world is escalating to a more and more exercise-driven place. This is good news for
us. If the company comes to a peak and will no longer make profits like it used to, then we will
try to sell the business. But we do not predict this to happen for a very long time.
 4

The Extra Mile: Running Specialists

II. Mission, Vision, and Culture
The mission of The Extra Mile is to promote wellness by connecting athletes to the right
gear that will assist in taking them above and beyond all expectations. Our goal is to become the
leading provider of running footwear in central Massachusetts by helping people realize their
true potential. Our ultimate objectives are to help people be better athletes. To reach your true
potential, you need the right gear and who doesnt want to look good? Thats where we come in.
However, the company also must provide items at a cost to make us profitable, so we will adjust
our prices in a way that we see as fair.
Here at The Extra Mile, the company prides itself on the knowledge of our products and
the sport itself, along with the personality that we bring to the table. Our core values are that of
determination, competitiveness and friendliness. Running is a very unique sport. Yes, you are
competing very hard to beat the other runners in various races, but after the race, everybody is
congratulatory of one another and supportive. That is how we plan on running our business. The
Extra Mile will be determined to beat competitors with our top of the line quality and staff, and
we will do so in a friendly and personable manner.
The staff can relate to all our customers because we have been in their shoes, literally.
There are several different kinds of runners and we have shoes for all of them. Every single body
is unique, and different bodies lead to different styles of running. These different styles of
running need different shoes. Our employees will be able to analyze everything about your
running style. The staff will be able to find out what type of shoe is best for you just judging by
the way you walk. We will be able to present this information to you in a professional and honest
way. The staff will tell you what they see, even if it is not what you want to hear. The employees
of The Extra Mile will all be runners themselves and therefore can relate to you. They have a
passion for running and helping others, which creates the exact kind of culture that we want to
display. Our company will be the most energized and motivated group of people that you have
ever met.
We will not just be offering shoes within our store. Along with all our running apparel,
the store will be sponsoring different road races and even putting on some of our own races in
different times of the year. The road races will start and finish at our store, and we will also be
sponsoring a beer run, all in an effort to give back to the community. A running club will also be
sponsored in which employees and customers can bond with one another through the process of
running. This will also help us understand the true needs of the customer and help us ultimately
run a socially responsible business. Our store will be called The Extra Mile because we want to
serve people who are willing to go the extra mile and are determined to make themselves the best
that they can be.
 5

III. Company Description

As an experienced runner, one of my biggest problems was not being able to find the
right shoe. Many of the stores I would go to would only have the newest version of every shoe
on the market. However, I am the kind of person who likes to stick with something until it is
broken. Therefore, I would stick with the same shoe until I felt it was necessary for an upgrade. I
would always find myself disliking the newer version and reverting back to the old shoe. To this
point, my brother and I wanted to start a business for people like us who just wanted a bigger
variety of both new and old shoes. My brother and I came up with the idea of The Extra Mile.
The Extra Mile is a retail store that provides shoes, clothing, and accessories to athletes,
specifically athletes who are involved in running. The store is involved in the wholesale sector.
Our store will satisfy the growing demand for athletic footwear and all your running needs.
Being in shape is becoming more and more of a want for people all over the world. One of the
quickest ways to do this is by running. Running is a great form of exercise and it is a lot easier
when you have the right shoe. We will also sell running apparel such as dri-fit short and long
sleeves and dri-fit shorts from various companies.
This company will be run as a partnership between my brother and I. We chose the option
of a partnership because we wanted to do it together. We understand that we will have to become
emotionally, mentally, and financially invested in the business, but we are very confident in our
business. With both of our assets combined, we believe that there is a great chance for growth
and success. My brother and I will be the co-owners. Eventually, we will add a golfing aspect to
the business because my brother is very involved in this sport. The store will have a combination
of one of the most physically enduring athletic activities and one of the most relaxing athletic
activities to balance things out.

We intend to register within the state of Massachusetts, specifically in the town of

Charlton, MA. This is where we plan to physically operate the business. Management
plans on targeting all people in central Massachusetts, some parts of western
Massachusetts, and the upper areas of Connecticut, for the most part. This includes all
types of runners from amateur to marathon. The company plans on having our footwear
as our primary source of inventory, but also plan to have major companies such as Under
Armour and Nike provide us with apparel as well. Our biggest strength will be our vast
selection. We will not just have the newest shoe available in our stores, but different
versions of the same shoe from every major running company such as Saucony and New
Balance. If our company becomes incorporated, we will try and limit the percentage of
the company each shareholder owns to a very small number. The business education that
I will receive at Nichols College combined with the passion and knowledge that my
brother and I have for the sport will ultimately help us reach all the goals that we set to
achieve.
 6

Opportunity Analysis and Research

Our customers will be segmented across Massachusetts and different parts of

Rhode Island and Connecticut. We are not primarily targeting any type of people in terms
of demographics, everybody runs and you do not have to be a certain type of person to do
it. Our company is trying to satisfy the need for shoes. We found most of our data through
general research and statistical research both nationwide and targeted primarily in the
areas that we will be advertising to. Along with all our benefits, we want to primarily
educate our customers about the benefits of choosing our shoes and the shoes that they
personally need.

IV. Industry Analysis

We are involved in the athletic footwear/apparel stores industry. In terms of the

NAICS code, we are 4482105- athletic footwear stores. This is identified as:
establishments primarily engaged in retailing athletic footwear. These establishments may
also sell athletic apparel. (NAICS Codes, Census) In terms of an SIC code, we are 5661,
which is also known as retail-shoe stores. (SIC Codes, sec)

Several factors influence the demand for the products that we supply. The biggest factor
would be the people participating in running or jogging. Over the past decade, running
participation has increased to record heights, which also correlates with the shoes/apparel sales
skyrocketing. If more people continue to get active and go running or even for a slight jog, our
demand will continue to increase. Another factor would be the weather. In colder weather, people
become less motivated and do not run as much as they would in other times of the year. In
warmer areas of the country, there are much more people participating in running such as the
Southeast or the West regions. Another factor would be the rising price of shoes in general,
specifically running shoes. Running shoes have become more and more advanced in terms of
cushioning, flexibility, and weight. Therefore, they are becoming more and more costly. This
could have a negative effect on demand because certain runners do not understand how better the
shoes are nowadays and are not willing to pay more than they used to for better shoes.
In contrast, there are also several factors that will influence the supply for our products. If
the companies that provide us with our footwear and apparel, such as Nike, Saucony, etc. are
going through a relatively tough time, then they will not be producing as many shoes. Therefore,
our supply will also be down. We will heavily rely on the processes of the companies that supply
us. However, because we will have such a big inventory, we will not have a problem dealing with
variety. If these companies are staying profitable, then we will not have a problem with supply.
This factor will also trickle down to other processes. This could include the cost of raw materials
and production, transport conditions, machine depreciation, labor increases or decreases, etc. can
all have a positive or negative effect on the supply of our products. The increasing technology
will most likely have a positive outcome because it will cause companies to produce more
products in a quicker time.
 7

Over the past two years, the running industry has seen a decrease in participation which
has led to somewhat of a decrease in sales. The decrease in sales can be attributed to a lack of
education about the benefits of running and having the right gear when you are running.
However, over the past decade, the industry has seen a massive increase in participation and
sales. As of 1990, there were only about 1.2 million females and 3.6 million male competitors in
races across the country. As of 2015, there were around 10.7 million females and 8.06 million
males that competed in races. That number reached a record-high in 2013, so the numbers are
expected to level out over the next couple of years. However, around 2017, those numbers are
expected to skyrocket again to almost 20 million. These numbers are expected to grow because
of the growing number of runners in the world. The increase in the warming climate can also be
attributed to many people starting to run. Analysts in the industry predicted that running in
general would level out for the next couple of years, and then continue to grow. The same can be
applied to running participation in general and not just specifically racing. From 2004 to 2014,
running participation has increased by almost 60%. Overall participation has increased from 24.7
million to 42 million in 2014. (2015, U.S. Race Trends)
The running industry in general has been seeing some positive trends. The number of
running events has been increasing on a yearly basis. Again, 2013 was the peak for all events. An
interesting trend is that females are becoming more involved than males in competition and
participation in general. The shorter distances continue to be the most popular among runners,
specifically the 5k. Long-distance running is only for a select number of people. The age group
that is most involved in running is 25-44-year-olds. (2014, U.S. Running Industry Report)
However, running is becoming more and more popular among younger children. Running is
encouraged because it is one of the best forms of exercise that your body can endure. With all the
obesity and unhealthiness going on in society, running and different forms of exercise are being
promoted at different levels. It needs to be instilled on children at younger ages because running
is a lifelong sport. If our company creates good experiences for children early on, then maybe
they will be a lifelong customer. The industry is filled with friendly and kind people. Runners
encourage other competitors to do their best, even if that means beating them. This creates an
amazing atmosphere between people which relates to the characteristics of the industry.
The major customer groups for this industry are consumers. These consumers will be
people that are interested in healthy lifestyles, like to compete, or just like running. These
consumers will be both men and women. Since all ages run or walk, we will try and fit every
person with the correct shoe. Of these consumers, we will try and target people on a solo basis as
well as a group basis. There are various running groups and competitive clubs around central
Massachusetts, and we will also target local high school and college teams. Usually these are the
elite athletes in the area. Groups such as the Central Mass Striders, Nichols College, and even
Shepherd Hill high school athletes are some of the most talented in the area. If we can appeal to
the more elite athletes, then word of mouth will spread. Amateur runners are more likely to listen
to somebody who runs competitively rather than people who have run a few amount of times.
The truly elite athletes will be a huge focus for our company. However, our target market is
enormous. We will be targeting central Massachusetts runners, along with Western Mass, some
parts of Eastern Mass, the upper area of Connecticut and even some parts of Rhode Island.
 8

Altogether, we will be targeting around 2.5 million people. Around 1.7 million will be
from various parts of Massachusetts. The remaining 0.8 million will be from various parts of
Connecticut and Rhode Island. (U.S. Bureau of Labor Statistics) We decided not to pursue other
states in New England such as New Hampshire and Vermont just because they are too far away.
We are also losing a lot of people in Massachusetts because the Boston area is the most densely
populated. However, our location is not in a good spot to target these people, and the competition
is much more stiff in Boston.
We hope to not only target runners, but convert people who currently do not run, over to
the act of running based on our selection and care. Of the market, we hope to acquire at least
300,000 different customers throughout our first couple of years in business. If that is
unattainable, we hope to at least make 35% of our customers come back more than once. We
want to create customers that are loyal to our store. Shoes are not like houses. Once you buy a
pair, chances are you will need another one relatively soon. Running shoes can take a pounding
and often wear out quicker than most shoes just because they are used so much. Therefore, the
running shoe is a product that does not fluctuate in demand that much. People are always going
to need new shoes.
V. Environmental Analysis
Our strengths, weaknesses, opportunities and threats are different concepts where we
focus a lot of our attention. Our biggest strength is the knowledge that our staff has. We have a
staff that has an extensive knowledge of everything relating to running, especially matching
different runners to the right shoe. These people have been runners their whole lives so they
know exactly what it is like, and they can relate to you on a much more personal level. Another
one of our strengths is the vast selection that we offer. We have shoes, apparel, and accessories
from the major running brands that people know. The store does not carry cheap stuff. Our store
also has many of the old and new versions of different shoes. These are brands that people trust,
and we hope they relate that trust in the product, to a trust in our store.
Another strength would be the flexibility we have with the customers. To get the ultimate
feel for the shoe, we let our customers try on the shoe and actually run outside in it. To really
understand the comfortability of a running shoe, you have to run in it, and we understand this.
Therefore, we let our customers run a short distance in the shoes before they make a final
decision. Our store also has a great warranty program. If the customers decide to buy the shoe,
but change their mind after running in the shoe a couple of times, they can come back and get a
refund on their shoe. We ask customers to keep track of how many miles they run in the set of
shoes specifically, that way we can give them a refund for a percentage of what they pay.
Otherwise, we would have people coming in and saying they didnt like the shoes after every
single pair they buy, while paying no money for it. So, we make an educated estimate based on
what they tell us and the condition of the shoe when they return it. Then, we sell the shoes again
for a reduced price because we do not want to waste our product. Depending on the condition of
the shoe, the price could be significantly lower or a just a little bit lower. We let the customers
know the situation and many customers are willing to pay less for a shoe that is not brand new.
We have somewhat mimicked the used car idea and translated it into shoes.
 9

One of our big weaknesses is the fact that we do have a large inventory. Because we have
such a huge variety of shoes, we are obviously going to have a lot of inventory. Luckily, shoes
are not like food and they will not go bad. However, a lot of runners only want to buy the newest
things. If we have a lot of the old stuff, then that inventory may never be purchased. Another one
of our weaknesses is that we are not located in the city. We may be located right off a highway,
and in a good spot in terms of runner population. However, we are not close to the city of
Boston, and that is where the largest number of runners are in Massachusetts. However, we are
happy with our location because we believe we will eventually attract runners from all over. A
final weakness could be our late start to the industry. As stated before, running as a sport sort of
peaked in 2013, even though we think it will rise above those numbers in the coming years.
However, if we had started our business a little earlier, then we might have already been a huge
name.
There are unlimited opportunities for our store. If our store does well and is very
profitable. Then, we always have the option to open another store or even think about franchising
if the case presents itself. We believe our advertising and quality of product will put us in a very
good spot in terms of profitability. Therefore, we will think about opening multiple stores if we
have the money to do so. We also have the opportunity to expand to online shopping. We prefer
when customers come in to the store to try on the shoe because you cannot try on a shoe through
a computer. But for experienced runners, if they have worn a shoe before, and they know exactly
what they want, it would be much easier for them to order the shoe online rather than come into
the store.
Another opportunity that we see as very promising is the racing industry. We want to
initially sponsor a couple of local races and have 1 or 2 of our own races. However, if these races
that we are sponsoring and putting on do well enough and have enough participants, then the
opportunities are limitless. We would be able to start putting on races all over Massachusetts at
various distances and increasing our profits by implementing the various entrance fees and by
making our store more known to the public. There will also be multiple discounts that will work
for each aspect. For example, any person who participates in one of our races, will receive some
type of discount at our store.
Our biggest threat would be the business of the average American citizen. Americans are
busier now more than they ever have been. Around 20.5% of the total workforce works around
49 hours a week. With another 11 million people working 60 hours a week. (Schabner, ABC
News) Add in bringing the kids to and from school, going to the gym, watching their shows,
cooking, etc. Often, people have the desire to run, but they just dont have the time anymore, so
they dont even bother. This can also relate to the threat of the economic conditions. Our
economy has been building back up slowly after the crash in 2008, but there is always the
possibility that it will happen again. Starting out as a small business is hard to do in this country.
The failure rate is historically higher than its ever been. Therefore, we have to be on the lookout
for the dominance of big business.
A final threat could be the already established running shoe stores. There are multiple
specialty stores in the Worcester area that have been around for several years that have been very
 10

successful that we will get into later in our competitive analysis. Other threats would be the
competitors that have more to offer than just shoes and apparel. Stores that offer much more will
take away customers because people will be shopping there for other reasons. They might think
to themselves that it would be much easier and convenient to get a pair of running shoes now that
they are already in the store.
These opportunities and threats are also factors that will impact our business. If the world
keeps moving towards a technology driven economy, then we will have to apply a lot more of
our focus to the online world. However, this is not that likely to happen because people still need
to physically try on shoes before they buy them. The economic crisis can also influence our
organization. Nobody will be able to predict what the economy is going to be like on every given
day. If there is another crash like the one in 2008, then people will not have as much money.
The fact that we are in New England will also play a huge role in terms of environmental
condition. Obviously, New England weather is unpredictable. There are more runners in the
southern part of America because it is always nice there. Nobody wants to run in snowstorms,
besides the truly dedicated athletes. We are predicting to have much fewer profits in the winter
compared to all other seasons. However, many people make New Year resolutions around
January and often times those resolutions deal with exercising which is where we come in. We
also expect Christmas to be a very busy time for us. The winter will be much more sporadic and
less profitable. We expect fall and spring to provide us with a steady flow of income because that
is when most athletes are getting into their respective seasons and there are a lot of races going
on. We expect summer time to be the most profitable since it is so nice and a lot of people are out
of school and work, therefore they have much more time and ambition to run.
VI. Competitive Analysis
Our competition is very broad in terms of other organizations that sell shoes. There are
numerous stores that sell running shoes. Some of these stores only sell running shoes, other
stores sell sporting goods that include running shoes, some of these stores also sell shoes in
general, which includes running shoes. There are also various sites that sell running shoes along
with different products. Our direct competition will be the various specialty running stores that
are similar to our store, such as Sneakerama, Marathon Sports, and PR Running. We will also
consider big sporting goods stores such as Dicks Sporting Goods and Olympia Sports as our
direct competition because of their quality and selection. These stores also do not offer the
personalized service that our store and stores like Sneakerama offer. For our indirect competition,
we will be focusing more on retail stores that sell shoes but usually have a small variety of
running shoes. Stores like Famous Footwear, Foot Locker, and Finish Line will be indirect
competitors because they try to substitute quality running shoes with poor quality running shoes.
We are very confident in our competitive advantages that will help us overcome our
competition. In terms of quality, we could not get any better. We only offer the best products
from the most respected athletic companies. We dont sell any knockoff or cheap brands, so we
will be highly respected in terms of quality. As far as price goes, you will pay for what you get.
We do a thorough analysis of every shoe that we have. Customers will be paying for shoes based
on their durability, comfort level, weight of the shoe, etc. Our prices will be very reasonable. The
 11

running shoe industry is becoming increasingly valued. Therefore, the shoes are skyrocketing in
terms of price. We intend to not follow this trend. We want customers to truly get out what they
put in. We will also be offering various discounts and sales promotions throughout the year that
other companies do not have. One example would be specifically tailored for cross-country
athletes in the fall. If an athlete buys a pair of training shoes and racing shoes from us at the same
time. Then, we will offer the racing shoes at 40% off.
Our location is very accessible to runners everywhere. We are not located in the city, so
our location is very simple. We are not around the most populated area. However, we are located
in an area that is highly populated in terms of central Massachusetts. We believe that our
products and service will be so far ahead, that we will be able to attract people in the city to
come out to our store. Our selection also relates to our quality of shoe. We are very confident that
we will have the biggest selection of shoes around. Most stores only carry the new versions of
different shoes. However, my brother and I do not necessarily cope all that well with change. For
this reason, we decided to carry numerous versions of shoes including very old and brand new.
Many runners are similar to our style, which is somewhat stubborn at times. Once we find a shoe
that we like, we often stick with that shoe and only want to buy that shoe. Many runners are like
this as well or just prefer older versions of shoes. Our service in providing these shoes is also
unbeatable. Our staff is one of the best in America in terms of knowledge, relativity, and
friendliness.
We have a lot of competitors that sell shoes and apparel. Our main competitors will be
companies that sell products most like ours and ones that specialize in the running industry.
Stores such as Famous Footwear, Finish Line, Foot Locker, Dicks Sporting Goods, and Olympia
Sports are all stores that sell a wide range of sporting shoes and/or apparel. However, these stores
do not specialize in running shoes and apparel. They offer different sports gear such as basketball
shoes, baseball and soccer cleats, or something like football helmets. This clearly takes away
from their running gear because their staff does not have the specific knowledge of the running
industry and they do not have as much of a selection. Therefore, we will not be competing
primarily with these stores. We will primarily be competing against specialty running stores that
are similar to us. Stores such as Sneakerama, Marathon Sports and PR Running will be our main
competition.
Sneakerama is a store located in Worcester, MA. It is a small building right off a main
road. Sneakerama only sells shoes with very little apparel. Their staff is very similar to ours in
terms of knowledge and ability to relate to the customer. They have experienced runners on their
staff. Their selection is relatively large. Their main competitive advantage is that they have been
around for so long and have an established reputation and a loyal customer base.
Our primary competitor will be Marathon Sports because they are so similar to our store.
They are located in Worcester, MA right on a main road. They have a very experienced and
knowledgeable staff in terms of running. Their selection of shoes is large along with their apparel
selection. They also offer the same products that we offer. They also offer some of the same
advantages such as the ability to run with their selected shoe outside. Marathon Sports is also a
chain of stores. They have many locations throughout the United States, so people know and
 12

respect their company. Many of their advantages such as their running club that is offered and the
various team nights that they have are also similar to what our store will be participating in.
PR Running is located in Westborough, MA. They are kind of a combination of
Sneakerama and Marathon Sports. Their selection and staff are both great aspects of their
company. They have about the same number of shoes and apparel as Marathon Sports, but they
do not offer some of the competitive advantages that we offer such as the used shoe option or the
ability to actually run with your shoe before you buy it. It is also not as established as
Sneakerama or Marathon Sports, so they are more of an up and coming company.
Our strategy for outperforming the competition relies on the implementation of our
competitive advantages. We will strive to be the best in terms of service, quality, and selection.
We have confidence in every aspect of our business, so we have confidence that we will truly be
the best. We will rely on our prices and offerings that other companies do not have, such as the
used shoe program. We are also going to heavily rely on our community involvement. We will
put on different events periodically to boost our popularity. These will be the events such as the
road races that we discussed and different events that we plan on sponsoring. We will also offer
various nights for any running club or local team to come in and receive reduced prices and
giveaways for different items. Marathon Sports also takes part in this, but we plan on having
much more involvement because the town of Charlton and neighboring towns such as Dudley
and Spencer are much more closely-knitted than the town of Worcester. To carry out this strategy,
we will market our products and competitive advantages heavily. Our products and service will
be the best, and we want to make sure people know that. We will also use barriers to entry to do
this.
Our brand loyalty will be our biggest barrier to entry. We want to create customers that are so
loyal, that they will refuse to go anywhere else. This can also relate to our geographical barriers.
As of right now, we are the only specialty running store within 20 miles. The only other stores in
central Massachusetts are Sneakerama, Marathon Sports, and PR Running. Sneakerama and
Marathon Sports are located thirty seconds apart from each other, so they target the same base of
people. We will target the people that have to travel all the way out to Worcester for a good pair
of running shoes. The convenience factor will be a huge advantage for us. We will also rely on
the economies of scale factor as a barrier to entry. As we create more and more product to satisfy
the demand, our average costs will fall. This will in turn create even more demand for our
increasingly low prices. This will make it tough for our competitors to truly compete in the
market, both in-store and online. It will be a cycle that we hope will eventually turn our store
into a dominant running shoe warehouse.
 13

Marketing Strategy and Plan

Our marketing plan is going to be one of our strongest attributes. It is going to be
effective because it is going to target our market segment in every way possible. The companys
plan will target the people that we think will be able to come to our store in terms of their
location and demographics. In terms of their behaviors, runners are often similar and appeal to
the same things. Therefore, our marketing plan will focus on trends that have been successful in
the past. We will be able to analyze these trends and make improvements where necessary.
Of the 300,000 customers that we are trying to acquire, we figure we should have to
capture at least 5,000 of these customers, which would be about 2%. If these customers all
bought an average cost item in our store, then our expenses would be covered with money left
over. However, we plan to capture a much greater percentage of the market to be as profitable as
possible.
A positioning statement for our company would be that our product will be better than
our competitors due to the durability, comfort, and variety of the running products that we offer
and through the expertise in the way we serve these products to our customers. In terms of
growth, our plan is to eventually open another store after we get our feet wet. This will probably
be self-generated growth. If our business meets our expectations and even surpasses them, then
we will consider the option of franchising. For now, our goal is to be profitable and hopefully
open another store in a different location within the first 10 years of operation.
We will also be reaching out to non-traditional runners. Non-traditional races such as
Spartan Races, Tough Mudders, etc. are becoming very popular within the United States.
Although these are not traditional road races, they are still races, which means people will need
running shoes to participate in them. These shoes may even wear out more quickly because of all
the challenging obstacles that these people go through. Therefore, we are going to try and target
this group of people in an effective way because the number of people participating in this race is
growing rapidly.
VII. Products/Services
We intend to market mostly all our products. Some will be more heavily marketed than
others. The main revenue generator will be our shoes. The one thing that a runner needs is shoes.
The shorts, shirts, and accessories that one is wearing are not as important. If a runner has a good
pair of shoes, anything can be accomplished. The shoes will be marketed much more than all our
other products. The apparel that we provide will be marketed somewhat heavily as well. We do
not plan on making as much profit with our apparel because the market is just so saturated with
athletic apparel. However, we will emphasize the fact that we have the best apparel from all
different running companies such as Brooks and Asics. Many other retail stores only carry huge
names such as Nike and Under Armour, but our variety will be much more effective in terms of
appealing to the customer. Our accessories will not be marketed that thoroughly. Many of the
items in this department will be things that runners notice they could use as well. It will be of a
convenience for our customers, but many of the customers we have will not be coming in strictly
for the accessories. Things such as foam rollers and rolling pins will be something that we plan
our customers picking up in addition to a pair of shoes. However, the company does intend to
 14

market our running watches quite heavily. Many other running stores and athletic stores do not
carry these items. They are hard to find and many people resort to buying these watches online.
Our store will have the best quality running watches including the Fitbit brand. Due to the lack of
these items in other places and due to the high prices of running watches. We will market these
very effectively.
Our products will meet customer needs because runners are always trying to improve. To
improve, you have to replace your worn-out gear. That is where we come in. We are also trying
to improve athletes. Most of this comes with determination and talent. However, good gear will
not hurt. To feel good, you have to look good. Our store will be meeting the increasingly high
demand for athletic footwear and apparel because of the countrys rising trend of personal
wellness.
The products that our store will be selling are in the maturity stage. Running in general
has reached the highest point that it has ever been at in recent years. We would rather our product
be in the growth stage, so we could have timed the market perfectly. However, personal wellness
is not the type of industry that reaches a maturity level and immediately declines forever. It is
something that will fluctuate often due to the people in our society. However, we believe the
trend has been escalating in the right direction.
Our company will focus on marketing the durability and comfort of our products.
Because we will be selling the best products from the best companies, people already know the
benefits of these products. These other companies that we will be buying from are already so
established throughout the world. This makes our job easier because we represent an outlet for
these companies. However, instead of just one brand name, we will be selling various brand
names of the best products in terms of durability, comfort, and weight.
We do not intend to own any copyrights, patents, or any intellectual property. Our store
will be selling different companies products, and we do not intend to manufacture any of our
own products. The closest thing we have to our own idea will be our used shoe program.
However, this has been established throughout stores nationwide, but it is not established at
many stores.
VIII. Pricing
Our organizations pricing strategy will be a combination of personalized and follow-the-
leader. Running shoes are not cheap items. These are products that are intended to last a long
time. This is hard to do because of the continuous pounding they take whether that be from the
pavement, trails, or a track. Therefore, the amount of research and development that goes into
every shoe is very large. This can be attributed to the rising prices of running shoes and athletic
equipment in general. In this industry, it is somewhat difficult to differentiate yourselves in terms
of price. We intend to attract customers due to our service and quality. Our company will strive
to give the best possible price in terms of our competitors. Therefore, we will determine our
competitors prices and try to lower ours below their average prices. However, this price will not
be a dramatic difference. We will be following the leader for the most part. There are certain
products that we will be able to personalize in terms of price. Such as our used shoe program and
other items that we think are somewhat overpriced like the athletic apparel. However, in terms of
our biggest piece of inventory, our shoes will not be that much different from the competition.
 15

Our company will be very effective in using various discounts. The store will offer
various discounts throughout different times of the year such as around the holidays. We will also
offer various discounts to local teams and local clubs as described before. If a certain product is
not selling as much as we want it too, or we believe a certain product will be experiencing
trouble, then we will discount it to a point that we think is reasonable. A discount structure will
be in full effect. However, we will determine what the exact discounts are through reflections of
our customers and the market.
In terms of payment, we will be accepting all major credit cards. We also encourage the
use of debit cards and cash because it is easier to handle. We will also accept personal checks.
IX. Promotion
Our main distribution channels that we intend on marketing through will be television,
the radio, the internet, and the newspaper. We also plan on creating various social media pages to
promote our store. Our message will focus on the fact that we are in such a convenient location
for people and they will not need to travel to Worcester to get a great pair of shoes. Our
marketing will also focus on the fact that we have a wide range of products that fit every runners
needs. We will promote all the most respected brands in the running industry. Our marketing
channels will be effective in getting our message to the public because we are accessing our
customers through various channels. Because runners can be of all ages, we decided to try and
market through channels that appeal to all generations. From our research, we determined that
most people over 45 are more likely to be reached through the newspaper and the radio. People
younger than 45 are more likely to be reached through the internet. People of all ages see
advertisements on the television. We will be using the most of our budget on television ads
because we believe that customers will be more likely to visit our store if they see the store on a
screen. We are going to market very heavily in the first year to make people aware that we are an
established store and to try make our store well-known. In the following years, we will slowly
cut back on advertising costs.
Advertising (Year 1) Budget ($15,000)
Television $8,000
Internet $3,000
Radio $2,000
Newspaper $2,000

Our business slogan is going to be the both motivating and catchy. We hope to eventually
put the saying on our building as well. The slogan will be Its a big world, go run it. Our
business logo will be simply that of a cross country symbol. Most commonly this symbol is a
running shoe with wings on the back of the shoe. Our advertisements will be shown, read, and
heard about through all central Massachusetts, specifically on Charter TV3 because it is a local
channel and we are a local business. We will also advertise on CoolRunning.com because it is a
site that many local runners use. In terms of the newspaper, we will place ads in the Spencer
New Leader, and the Worcester Telegram and Gazette. We will also be marketing through
different parts of Connecticut. We want these ads to play at least twice a week for our first year
of operation.
 16

In terms of publicity, we think the events and races that we put on will cover it. Our races
will be advertised and we will be noticed by the community. In turn, people will also come to our
store because they have either read about us or heard about us via word of mouth. People will
also be aware of our store because of our superior customer service as stated before.
Our customer database will be kept on our simple computer system, along with all our
research about consumers and competitors. The essential questions that will be asked will be
indicative of the customers preferences. Questions such as what is your favorite brand? Do you
focus more on comfort of lightweight? Do you prefer dri-fit material or cotton? The more we
know about the consumers of the target market, the better.
X. Place
We intend to sell our products at our physical location. As of now, we are still deciding
between two different locations. Both locations are in Charlton, MA. We believe that these
locations both have many advantages. The first site is located in the center of Charlton, MA. This
spot is about 1 minute away from route 20, so it is very easy to access. It is also located in an
already established mini-plaza, so it will be very easy for people to see. This site will also be
very easy in terms of putting on different events such as road races. We will not have to put on
events at a different location because we will be able to do them right in the center of town which
is much easier. A big disadvantage to this location is the fact that it is a relatively small space. In
terms of size, we were thinking a little bit bigger.
The next location is located right on route 20. It is right before the Wal-Mart plaza in
Sturbridge, MA, but the physical location is still in Charlton. MA. This is a somewhat
commercialized area. Thousands of people travel on this road every day and would be going
right past our building. There is also a lot of other things to do around this area besides just get a
new pair of shoes. This location was recently a well-known gym in the area called Sims Premier
Fitness. The gym recently closed down and the space is looking to be leased or purchased. This
location would be great because of its convenience. It is right on a major road in central
Massachusetts. The gym itself was already known to many people, so they would not have
trouble finding it. Also, people who go to the gym often have a preference for running, so we
could transfer some of the Sims Premier Fitness members to become avid customers at our
store. The space would be plenty big enough for us to sell all our products. If anything, it would
be too big. We are possibly searching for another business to maybe take the top or bottom floor
and that way we could split the lease in half. The only real disadvantages for this location would
be the fact that we would have to renovate a substantial amount because it was in fact a gym. We
would have to somewhat transfer the atmosphere from a gym into a running store. In terms of
our events, we may or may not be able to run them right out of the store. It is on quite a busy
section of the road, so we would maybe have to push our events to a different location. For each
location, we would plan on renting the space. Buying the building itself would be too much
money for both locations.
We have concluded that our workforce would be made up of people in Worcester county.
People outside of this county would have to long of a drive to get to work, so we have limited
our available workforce to Worcester County. In this county, the civilian labor force is made up
of about 347,000 people. Of this 347,000, around 334,200 are already employed, and around
12,800 are unemployed. The employment rate is relatively low at 3.7%. (U.S. Bureau of Labor
Statistics) Our store will hopefully consist of both full-time and part-time workers.
 17

Management and Operations

XI. Management Team and Inventory, Production, and Quality Assurance

Store Owner (Brendan Coughlin)

Store Manager (Brodin Coughlin)

Sales Manager (also a sales Community Relations/Event

associate) Manager

Part-time sales associates x2 Community Relations/Event

Staff x1
(Also a part-time sales
associate)
We will be hiring employees. Our qualifications will not be too extreme. For the full-time
employees, we will be looking for experience in retail and/or sales. We will be looking for people
with strong communication skills as well. They will be talking to numerous people throughout
the day and trying to persuade them to buy our products. We will need hard workers that are
capable of doing multiple jobs. The biggest thing we are looking for is their knowledge of
running as a sport and all the products that we will be selling. We will also be analyzing their
previous jobs or internships and see how they did in college. Grades are not as important to us as
experience and success in the retail field. These employees will be the determining factor in
whether we succeed or not. They will help us because they will be able to do multiple jobs
interdependently, and they will be able to increasingly generate sales. For the full-time
employees, we plan on paying them somewhere between $45,000 and $55,000 for their first year
depending on which job they have. The part-time employees will probably make somewhere
around $10,000-$15,000 depending on how many hours they work. Our accountant is not on the
chart because it will most likely be one from an already established firm. My brother and I will
be at the store most of the time, so we will be able to personally train our employees by making
them aware of exactly what it is we want them to do.
My brother and I have decided to receive a relatively small salary. However, we will also
take home a percentage of the profit of the whole store. Since we are co-owners, we will be
splitting this. Obviously, this will not be all sales of the store because we will continue to need to
buy materials, pay rent, etc. However, we have decided to take a salary and a percentage of sales
because we need financial stability. If the store is going through a rough time in terms of profit,
then we will still have our salaries to fall back on.
 18

Our most important policies towards our employees will be the fact that we will treat
everybody as equals and we will create an atmosphere that is both laid-back and productive. We
want our employees to be productive as possible, but we also understand that retail can be slow
at times. We hope to create an environment in which the employees feel comfortable with their
bosses. We want to create an atmosphere that is both an upbeat and a rewarding place to work.
We will accomplish this through various benefits and the managers attitudes towards the
workplace. We will offer various break times, sick time, vacation time, pay incentives, and we
will try and let our employees more or less pick what hours they want to name a few of the
benefits. Either my brother or myself will always be at the store, except on the weekends most
likely. Therefore, we want to create a friendly environment and we will treat our employees as
equals to ourselves because we truly believe they will be just as important to our company as the
owners.
Our corporate governance plan will be based on five different principles that we use to
guide our employees. The first and most important is the fact that the customer is always right.
The second principle will be to always respect the people that you report to. We encourage lower
level employees to offer suggestions and possibly even criticism, but we want them to do it in a
respectful way. The third principle will simply be the teamwork aspect. We want to encourage
our staff to think of themselves as a cross country team. We are all runners that are competing for
the same common goal. We will be working together and encouraging others to succeed. Instead
of trying to win a championship, we will be a cross-country team that is focused on achieving
success in terms of profit for our store. Our fourth principle will be relating to the aspect of
giving back to the community. We do not want to just be known as a running store, but a running
company. This involves giving back to the community with various events that we will put on to
benefit both our company and the community as a whole. Our last principle will be the fact that
all employees will do their job to the best of their ability. By following this plan, we believe that
our employees will be put in the best place to ensure success.
We do not have any real mentors or advisors. We will be the mentors for our employees.
We believe our knowledge of the sport itself is so vast that we do not really need any guidance.
Our ability to communicate with people in an effective and persuasive way will also help our
sales techniques.
Our company will be conducting various types of research. Our most important research
will be determining consumer preferences. We want to give the people what they want. We will
also be conducting research on our competitors and what kinds of things they are offering that
differ from what we are doing.
Many of the things that others in our industry are doing are very similar to what we will
be offering. Therefore, this research will not be as in depth as the consumer preference research
that we will be conducting. If anything, we believe our competitors will be conducting research
on us because they will be wondering why all their customers have started to come to our store.
We also will not have to worry about protecting our intellectual property because we will not
own any.
We will be purchasing our products from major suppliers. Nike, Under Armour, Asics,
Saucony, Brooks, New Balance, Adidas, Mizuno, and Reebok will be our main suppliers of
shoes and apparel. We will also be supplied by companies such as Garmin, Fitbit, and Zensah for
various accessories. For most of the companies that we purchase from, we will buy directly from
 19

the company. The products will be shipped directly to the store, or shipped to the nearest
distribution center for that respected company. For example, Nike has various manufacturing
centers around the world. These manufacturing centers then ship to regional distribution centers.
From here, the products are shipped to Nike outlets and different licensees. This will be the
supply chain for most of our companies. The average delivery time is 5 business days from all
companies.
Our products will be manufactured in the manufacturing facilities of the various products
that will supply us. Some of these manufacturing companies are overseas which will slow the
process down a little bit. However, many of our companies such as New Balance produce
products domestically. Our distribution process will be very simple. Once the product has arrived
at our store, then it is ready for customers to take home. The only real insurance we will need
will be insurance relating to the building itself such as damage protection, fire and water damage,
etc. Our accountant will make sure we are complying with federal, state, and local tax laws.
XII. Physical Location and Facilities
All of the Charlton zoning laws can be found within the following document. Our
business will comply especially because we will be operating out of a building that has already
been around and has been zoned in compliance with the town legislation.
http://www.townofcharlton.net/forms/TownBylaws2014.pdf
Our building will be determined when we choose which location we want to operate out
of. It will either be a one-story retail store in a plaza. This building would be around 1,200 square
feet and is attached to other ones. The other building would be a two-story complex. This
building would be by itself. This building is also around 2,800 square feet. The equipment we
will need will be computers for the few offices that we will have and the cash register and
various little things we will need to conduct sales. We plan on obtaining this equipment by
purchasing it from a respected technology company. We will also be hiring a company to install
all the different shelves, seats, and display cases that we need to show our products.
 20

Financial Analysis and Projections

The stores records, both financial and nonfinancial, will be very important to our system.
To create a better future, we must understand what did and what did not work in the past. Our
facility will include a small storage room that strictly consists of all our records. To be as
efficient as possible, we will add to these records and files as we go. That way, it will be as up to
date as possible. The tangible records will be kept just in case something happens to our
computers and/or software system. Our store will use Intuit QuickBooks Online to store and
keep track of all our records. QuickBooks will allow us to keep track of daily transactions and
expenses, pay employees along with bills, and send various invoices to wherever needed. It is a
simple system and we do not need a very advanced software because we are involved in the
selling of products, which is somewhat simple, as long as we are able to keep track of
everything. Our financial system will be extremely important to us. As business majors, our
owners understand the importance of looking at your financials. If there is ever a problem with
our books, then we will bring somebody in to help us figure out the problem.
Our store will have a few different bank accounts. We will have one for each type of
product we sell and the profit from each type of product will be put into this account. There will
be an account for footwear, apparel, and equipment. We will also have a separate account that
will cover all our expenses. A certain amount of sales will be put into this account and will cover
all our variable and fixed costs, such as salary, rent, and materials. There will be another account
that will only be used by my brother and I. Because we are the owners, we will be taking out a
small percentage of the overall profits of the store along with our salary.
XIII. Income Statement Projections
Altogether, we have concluded that we need around $200,000 to start our business.
Hopefully, we will not need any more investment capital throughout the duration of our business.
My brother and I will be investing a total of $100,000 of our own money. We have two options to
fund the rest of our money, either debt or equity capital or a combination of the two. My brother
and I have decided to take out a bank loan. For the first year, we need to find about an extra
$100,000. The rest will be funded through debt and equity capital. We will be taking out a bank
loan for somewhere around $50,000. This will depend on exactly how much we need to take a
loan for. However, we have accepted the fact that we will need some type of loan, and we believe
going through a bank is the easiest way to do that. The loan will be taken from North Brookfield
Savings Bank because they have been known for their flexibility with different loans. We have
figured that the loan will have an interest rate of 7%, which is reasonable for a small business.
We have figured that we will be able to pay the loan back within 4 years, so the scheduled
monthly payment will be just under $1,200 a month. With some luck, maybe we can get some
gifts from close relatives or close friends that will reduce the amount of the loan that we take out.
Our debt ratio will be around 50%. The rest of the money will be funded through equity capital.
We are looking for somebody to invest $50,000 for 10% of the company. We decided to combine
both debt and equity financing because we figured we would be able to pay a loan back
relatively quickly, but did not want to take one out for more than $50,000, therefore we are
seeking investors.
We will be using all the money to initially pay the first year of our lease, and any
renovations and/or maintenance that is necessary to transform the building into a running store.
This money will also be used to buy all our initial products. It will also fund our advertising for
 21

the first year and all the permits and licenses that we need. The initial investment will also cover
the first months of our employees salaries. The bulk of the money that we will receive from an
investment will go to the development of our website that will allow for online shopping. A large
portion of this money will also go towards developing the road race portion of our business. We
believe this could take a little while to get up and running. If we receive the investment that we
are looking for, we may be able to turn the $80,000 profit that we expect to receive in the 5th year
of operation, into $125,000. Altogether, we believe the total payback period for all the money
that we initially invest into the business will be 6 years.
XIV. Funding Request
The offer of $50,000 for 10% of our company is something that we believe is very
reasonable. We believe it will be very helpful in the initial stages of growing our business and the
money will go a long way. However, we will probably not go any higher in terms of giving out
stake in the company. This is our company and we believe that it is going to grow a very large
amount, so we want to own as much as possible. If we received an unpassable offer from a
friend, family member, or venture capitalist, then we would consider giving equity. If we find a
certain angel investor that truly believes our company will experience long-term growth, then
we would happily negotiate some sort of deal. Especially, if this investor has had a track record
of successful investments, However, that is the only way that we intend on giving away stakes in
the company. We have valued our company at $500,000. Obviously, our company will take a
little while to be worth this amount, but we believe that the growth our store will experience will
make it worth much more. This is great news for somebody that is partaking in equity financing.

Income Statement Projections (Years 1-5)

800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0
Year 1 Year 2 Year 3 Year 4 Year 5
-100,000

Gross Profit Cost of Goods Sold Net Income

 22

As you can see, our gross profits, cost of goods sold, and net income all rise substantially
throughout the first 5 years of operation. Our expenses also decrease a small amount each year.
Our fixed costs somewhat decline in each year with our variable costs staying the same. The
following chart takes a potential investor through our process of opening the store to the public.
Month (For the year of 2017)
Task January February March April May June July August
Selection of building
Allocation of
resources
Licensing process
Renovation of building
Equipment/supplies
set-up
Hiring of employees
Open for business
23
 24

Brendan Coughlin
147 Oakham Road, North Brookfield, MA 01535
508-868-1518
Brendan.coughlin@nichols.edu
Profile:
Diligent and responsible with excellent time management skills
Personally responsible for 80 percent of all education related expenses
 25

Maintain a 3.9 GPA while working part time and competing in a varsity sport

Education:
Nichols College: Dudley, MA Graduation Date: May 2018
Bachelor of Science in Business Administration
Major(s): Management & Finance
Cumulative GPA: 3.91
Honors Scholar Program September 2014-present
Deans High Honors List December 2014-present

Work Experience:
Academic Resource Center, Nichols College Dudley, MA
Peer Tutor June 2015-present
-Structure each tutoring session to the learning style of the student
-Tutor struggling students and help them learn more actively, specializing in finance,
accounting, and statistics

Sims Premier Fitness, 1 Stop Basketball Training Charlton, MA

Strength and Conditioning/Basketball Trainer October 2015-October 2016
-Personally train aspiring young athletes aged 9-17
-Coordinate and implement various training programs designed to give athletes the
competitive edge

Eagle Hill School Hardwick, MA

Maintenance Department Summers 2013-2016
-Manage for the grounds keeping department
-Maintain and landscape a 200+ acre campus
-Clean residence halls in collaboration with housekeeping division

Leadership and Activities:

Emerging Leaders Program June 2015-present
NCAA Div. III Mens Cross Country September 2015-present
NCAA Div. III Track and Field September 2015-present
Nichols College Honor Society-Zeta Alpha Phi April 2016-present
Student Athlete Advisory Committee September 2016-present
Teaching Assistant-Fundamentals of Music January 2016-May 2016
Mens and Womens Footwear

Brooks Glycerin Saucony Guide 9 Nike Zoom Rival XC

12 Running Shoe
$120.00 $65.00
$100.00
 26

Mens and Womens Apparel

UnderArmour Tactical Nike Dri-FIT Adidas Tricot

Coldgear Compression Tempo Track Track Suit
Long Sleeve Running Shorts
$70.00
$30.00 $23.00

Equipment/Accessories

Garmin Nike Tritan Water

Forerunner 10 The Stick Bottle
GPS Running (Running Rolling
Watch Pin) $15.00

$130.00 $25.00

Sources:
-"2015 State of the Sport - U.S. Race Trends | Running USA." 2015 State of the Sport - U.S.
Race Trends | Running USA. N.p., n.d. Web. 27 Oct. 2016. <http://www.runningusa.org/2015-
state-of-sport-us-trends?returnTo=annual-reports>.
-"2014 State of the Sport - Part II: Running Industry Report | Running USA." 2014 State of the
Sport - Part II: Running Industry Report | Running USA. N.p., n.d. Web. 27 Oct. 2016.
<http://www.runningusa.org/2014-state-of-the-sport-part-ii-running-industry-report>.
 27

-Division of Corporation Finance: Standard Industrial Classification (SIC)Code List." CF SIC

Code List. N.p., n.d. Web. 27 Oct. 2016. <https://www.sec.gov/info/edgar/siccodes.htm>.
-"NAICS Codes, Titles, and Descriptions." NAICS Codes, Titles, and Descriptions. N.p., n.d.
Web. 27 Oct. 2016.
<https://www.census.gov/retail/mrts/www/benchmark/2014/html/naicsdef.html>.
-Schabner, Dean. "Americans: Overworked, Overstressed." ABC News. ABC News Network, 01
May 1970. Web. 27 Oct. 2016. <http://abcnews.go.com/US/story?id=93604&pag
-"Worcester." U.S. Bureau of Labor Statistics. U.S. Bureau of Labor Statistics, n.d. Web. 27 Oct.
2016. <http://www.bls.gov/regions/new-england/ma_worcester_mn.htm>.