MANAGERIAL ECONOMICS

MUSCLE DEN
SUBMITTED TO; SUBMITTED BY:
BUSINESS MODEL OF MUSCLE DEN

 The muscle den is a family focused fitness club in Bangalore area.

 One of the keys to success of the muscle den is the ability to offer reasonably priced
childcare in a safe environment while a parent works out in the fitness center.
 The club has increased the size of its fitness center and added more equipment, but
many members would be unable to use center if they didn’t have a service to watch
their children while they exercised. In fact, the service has become so popular that the
clubhouse has outgrown its existing childcare facilities
 Fifty percent of our member are under the age of 45 and have young children.
Currently, the center has 900 members.
 A center membership is 54900 rupees a year.
BUSINESS MODEL OF MUSCLE DEN

 The center has grown steadily over past 3 years. Our fitness center is 12000 square feet
and the clubhouse is 50000 square feet, The focus is to keep the whole family involved
in the club offers.
 The company was established in 2016. And it provides many activities and services like
Swimming, Tennis, fitness center with cardiovascular and weight training equipment’s,
Sports Court, Massage, Physical Therapy, Childcare etc.
 The area for expansion for services was rented and now the club has also become 24-
hours only for gyming activity seven days a week.
Industry analysis of fitness industry

 The fitness industry in India is largely unorganized and lacks a definite structure
 Several start-ups in the fitness sector are now targeting urban consumers across various
age groups
 In India, at the end of FY2018, revenues to fitness market amounted to USD 908 million.
 And the growth in the market segment is expected at a CAGR of 9.3%, resulting in a
market volume of USD 1296 million in 2022.
BREAK-EVEN ANALYSIS
BREAK-EVEN ANALYSIS
If we talk about the break-even analysis it is the analysis help business owners
determine when they’ll begin to turn a profit and helps them price their products
with that in mind. It provides a dynamic overview of the relationships among
revenues, cost and profits.This is the analysis of company during first year where
the company has got 200 memberships. The variable cost of the company
changes with addition of 10 membership. The fix cost of the company is 840000.
During January and February the fitness club has to bear losses due to huge
investment in equipments and land. However, the company reaches its no profit
no loss situation with registration of 24th member with the company. Being setup
in Jigni the company has regular registrations each month.
WHY TO INVEST ?
 If we talk about our current business scenario, our muscle den fitness centre
is working quite well in Bangalore and we want to further expand our business
in Delhi.
 It is feasible to invest in our business because fitness industry in india is
growing at a pace of around 20%, and in respect of our business sale had
increased 80% in the year 2018 from previous year.
 our net profit in year 2018 it is 2.17cr ,which shows us the increase around
200% if we compare it from previous year.
 Profit margin initially was less which was around 10.94% in 2016,which has
increased to 25.80% in 2017 and in 2018 profit margin is around 44%.
HOW MUCH INVESTMENT NEEDED?

In year 2016, we started our business in Bangalore and the money that we
invested at that time was around 9 cr and if we are planning to expand business
in Delhi and for that expansion plan, we need funds and we are well aware that
Delhi is one of the most expensive city of our country and we want around 15 cr
for our expansion and we also know that the variable cost is almost same in both
the cities but the main difference is in fixed cost.