Danny McInnis
Meredith Murphy
Melanie McKoin
Calder Miller
Elliot Beatty
Red Stick Music Venue
11/15/13
FEASIBILITY STUDY WORKSHEET QUESTIONS
1. Cover Page
This may seem obvious, but entrepreneurs sometimes forget this.
1.a. What is the venture name?
1.b What is (are) your name(s) and how can you be contacted? Address, phone, fax, e-mail.
2. Table of Contents
This helps the reader find information quickly and easily. Include page numbers. (Again, it may seem obvious, but be sure that the page numbers on the table of contents actually match the page numbers in the text!).
3. Executive Summary
This section is always the first to be read. In less than two pages, you must get the reader excited about your business concept. If you fail to interest your reader, this may be all that is read. In two pages or less, describe your organization, demonstrate that customers want your product or service, and describe your founding team. (The Executive Summary should be completed last. It should stand on its own.)
3.a. What problem do you address?
3.b. What is your proposed solution and organization? What business is it, or will it be, in?
3.c. What makes your product/service unique? What is your competitive advantage?
3.d. Who are your customers? How do you know that customers want your product or service?
3.e. What are the projected financials for the project? How much money is needed to start the venture? Where will you obtain funding?
3.f. Who is on the founding team? What are each member’s skills and talents?
3.g. Summarize the key points from each section.
4. Business Concept
Red Stick Music Venue is for music lovers who want to see big artists without having to travel to different cities outside of Baton Rouge, the venue is an amphitheater that hosts live entertainment.
Unlike New Orleans, this service will be located locally in Baton Rouge and will provide well known artists and entertainment that will replace the venues located outside Baton Rouge in New Orleans.
5. Product/Service Description
This section is a detailed description of the products and/or services you will be selling. You should not assume that the reader is familiar with your product/service, so be sure to explain and describe it carefully.
Red Stick Music Venue will primarily offer the service of live entertainment from various musicians and artists. With hosting well-known artists, as well as, locally known artists, Red Stick Music Venue will be the first outdoor music venue in Baton Rouge. The venue will have partial inside housing areas for concession, ticket sales, and restroom facilities. The inside portion will be very minimal because the purpose of the venue is to highlight outdoor live entertainment. The set up of the theater will resemble an amphitheater style set up with covered seating along with a standing room only area. A large stage will be centered in the middle of the front of the amphitheater to accommodate for the live entertainment. Behind the stage we will craft dressing rooms and green rooms which will accommodate the needs of the artists who perform at Red Stick Music Venue. The venue will accommodate 10,000 patrons with a breakdown of 4,000 seats in the covered seating section and a standing room only area that will comfortably house 6,000 patrons. Ideally, Red Stick Music Venue will be located in downtown Baton Rouge along the waterfront property that runs along the Mississippi River. With this captivating scenery and large venue, Red Stick Music Venue will be able to provide the best live entertainment setting within all of Baton Rouge.
To satisfy more than just the entertainment aspect of expected patrons, Red Stick Music Venue will provide concessions which will include food and beverages, alcoholic and non-alcoholic. Our food menu will consist of hotdogs, nachos, burgers, popcorn, pretzels, ice cream and sno-cones. The drink menu will consist of water, coke products, beer, frozen alcoholic beverages, and mixed drinks. Red Stick Music Venue will accept all cash and major credit cards. As previously stated, concessions will be located inside and near the front of the venue property.
In regards to proprietary rights, Red Stick Music Venue will not have any; however, there will be different licenses and permits that the business will have to acquire. For example, because of alcohol sales, a liquor license will have to be obtained, as well as, food and health permits. These permits along with purchasing land and building the venue itself will be the primary major costs of Red Stick Music Venue. Because the company will have a high startup costs, this will be a major weakness to the business. However, with the business targeting the Baton Rouge entertainment sector and offering an innovative, unique spin on live entertainment, Red Stick Music Venue will exceed the startup costs and become a very profitable business.
6. Industry Analysis
Describe and outline the industry in which you will compete. When finished with this section, you and your readers should understand the dynamics, problems, and opportunities driving your industry.
Because Red Stick Music Venue focuses on live entertainment, the music industry will affect the targeted market the most. Red Stick Music Venue’s success will depend on our ability to forecast and adapt ourselves to the ever changing music and entertainment industries. Providing the most comfortable and entertaining experience to our customers will provide return patron; therefore, putting the guests in front of their favorite musical performers will be Red Stick’s foundation for success.
Additionally, Red Stick Music Venue will have to mindful of different trends and fluctuations in the music industry. Being aware of what artist is hot in the industry and forecasting the next hot artist will be key to the success of the business. Hosting artists, who are well-known, will always be important; however, the timeliness of booking up-and-coming artists will be key in providing the best shows. If Red Stick Music Venue can track the success of up-and-coming artists by researching their tour dates, who they are signed with, and who they tour with, the business will be able to capitalize on forecasting and reading the future trends. By capitalizing on these trends, and bringing in the local favorites, chart toppers, and timeless artists will be essential to keeping revenue streams positive and making Red Stick Music Venue the premier venue in Baton Rouge.
Because Red Stick Music Venue will have a large target market that segments into smaller sub-markets, each segment of the market can be appealed to with varying genres and ages of music from A to Z. With targeting college students and younger crowds, Red Stick Music Venue can host the recent chart toppers and icons such as Rhianna, Eminem, Jay Z, Justin Timberlake, and etc. Additionally, with targeting locals, Red Stick Music Venue will be able to highlight local bands and artists such as Parish County Line, NillyNation, Travis Ewing, The Megan Miller Band, and etc. Because timeless artists such as Jimmy Buffet will always attract a crowd, Red Stick Music Venue will be able to host such artist and attract people of all the sub-markets of Red Stick Music Venue. Being able to book and host various types of genres and artists will allow for Red Stick Music Venue to appeal to a mass market.
Because currently Baton Rouge does not have an outdoor live music venue, Red Stick Music Venue will escape local competition; however, with New Orleans neighboring the city, the venues there will be our primary competition. New Orleans attracts a large population because of their well known established reputation and abundance of locations to host live entertainment. However, for Baton Rouge natives, the drive to New Orleans is not always convenient; therefore, by offering the services of Red Stick Music Venue to Baton Rouge, the company believes that the competition will not have many adverse affects on the market in Baton Rouge. Actually, Red Stick Music Venue will try to utilize this competition in securing entertainment that frequents the New Orleans area.
Because the industry of entertainment is so enormous, the competition does not pose much threat on Red Stick Music Venue. Live music has been a staple of entertainment for many generations. Music festivals have been appearing the market at an exponential rate in the past 20 years. The top festivals and their venues sell out months in advance, giving the industry an ever increasing need for more and more. Because the industry always needs more and more artists becoming popular, the industry will always grow; therefore, providing much potential for Red Stick Music Venue.
7. Market/Customer Analysis
According to Mandy Porta, author of “How to Define Your Target Market,” businesses should focus on tapping into a niche and finding a focus to ensure a target market (Porta, 2013). Because Red Stick Music Venue will cater to the 230,000 residents of the Baton Rouge community, the company has decided to target a host of niche markets. Red Stick Music Venue will have a very broad primary market that breaks down into sub-markets. This approach takes the advice of Porta, but also considers the needs and wants of the community at large. The business will look to cater to Baton Rouge as a whole by offering various genres of music from a host of time periods. By keeping the market broad, Red Stick Music Venue will have the capability to attract a large and diverse group of customers and performers. Because Baton Rouge has a large college market, ideally the company will target college students as one of these sub-markets. However, because college students do not have a wealth of disposable income, it will be crucial that Red Stick Music Venue be mindful and strategic when focusing the targets of other sub-markets. For example, Red Stick Music Venue will target middle age and older residents of Baton Rouge as a sub-market of residents who have more disposable income than college students. The company will not be restricted based on a strict market; however, the company will have to be strategic in planning the appearance of different acts in order to capture the right sub-market at the right time. This approach will demand for more planning on the back end, but will benefit overall by reaching a larger population of Baton Rouge residents; therefore, yielding more profits. Ideally, the company will want to reach at least 20% of each sub-market on a given night. For example, when focusing on the sub-market of college students, Red Stick Music Venue will strive to attract at least 7,500 of the 37,500 college students who reside in either Southern, LSU, or BRCC in Baton Rouge. Capturing at least 20% of the sub-market populations will put the company at filling at least 80% capacity of the venue. The cofounders configured that this percentage would yield a turnout that would sustain the business.
Red Stick Music Venue will be an asset to the community of Baton Rouge because it will offer more entertainment and night life for community members. Instead of driving to different cities, or catching the different concerts that randomly come into town, Red Stick Music Venue will offer a consistent service of providing well-rounded unique entertainment, whether it is well-known artists or local rising talent. Because of the consistency and uniqueness, community members in the niche markets will want to experience what Red Stick Music Venue has to offer. The services and experience will captivate the customers, making them want to frequent Red Stick Baton Rouge. Although Red Stick Music Venue will succeed because of its strengths and benefits that it provides to the community, there will be weaknesses or challenges that come with the business. Because the music industry is flexible and fluid, Red Stick Music Venue will have to plan for cancellations and no shows. Additionally, Red Stick Music Venue will have to plan accordingly for competition that surrounds the area. Because New Orleans has a well established reputation for music and live events, Red Stick Music Venue will have to work to build its reputation, which will not be an easy task at hand, but can be overcome by differentiating itself for locals and by embracing the New Orleans market.
Red Stick Music Venue will escape local competition; however, with New Orleans only 80 miles away, competition will still exist. The various venues, live events, and festivals of New Orleans will be Red Stick Music Venue’s primary competitor. Although these areas will be a huge competitor, this competition could very well play in Red Stick Music Venue’s favor. In New Orleans, there are over 80 venues that provide daily and nightly entertainment from well-known artists such as Rhianna and Kirk Franklin to rising artists such as Chase Rice and Dax Riggs (NOTCM, 2013). Because of the overabundance of talent that surfaces in New Orleans, Red Stick Music Venue is bound to utilize some of New Orleans resources, and capitalize on the competition. By partnering with artists who frequent the New Orleans market, Red Stick Music Venue could bring a little bit of New Orleans to Baton Rouge for the residents who love to travel to New Orleans and see the different artists. Not only does tapping into this market benefit our customers or niche markets, this act may very well benefit the artists who will be performing. As previously stated, because Baton Rouge does not offer such services, artists may be more willing to break into the Baton Rouge market; therefore, making the most of their tour and yielding more profits for themselves.
Because Red Stick Music Venue will capitalize on the New Orleans market and market to the different sub-markets of Baton Rouge, it is crucial that Red Stick Music Venue research the New Orleans Market and the Baton Rouge community. By researching the market and different acts in New Orleans, as well as, researching the wants of the Baton Rouge community, Red Stick Music Venue will break into the market with an elaborate grand opening. By composing a lineup of artists that will target the different sub-markets, Red Stick Music Venue will penetrate the market in New Orleans and establish the market in Baton Rouge. For example, Red Stick Music Venue could host Rihanna or Jimmy Buffet, and a local band such as Parish County Line to target the different sub-markets of Red Stick Music Venue. Additionally, a crucial component of penetrating the market will rely on advertising. Red Stick Music Venue will build a promotional campaign that capitalizes on the unique live entertainment setting new to Baton Rouge.
8. Founding Team
Red Stick Music Venue is founded by Elliot Beatty, Danny McInnis, Melanie McKoin, Calder Miller, and Meredith Murphy. Each of the co-founders obtains a host of talents that will lead to the success and fortune of the new and innovative service provided to Baton Rouge by Red Stick Music Venue. The following section will display the uniqueness of each co-founder and talents that will make this business such a success.
With a solid background in technology and technological skills, Elliot Beatty will assist in all technological aspects of Red Stick Music Venue. From troubleshooting errors to researching and implementing the best technological practices in terms of entertainment and functional services, Beatty will ensure that Red Stick Music Venue functions at its best in terms of technology.
With a comprehensive background in financial analytic work, real estate appraisal and commercial lending, co-founder Danny McInnis will be beneficial in the success of Red Stick Baton Rouge. McInnis will handle the acquisition of the site for Red Stick Baton Rouge, as well as, ensure that the location will allow for the optimal amount of exposure for the company while allowing ease of access for all of patrons involved. McInnis will handle any and all lending needs required to prepare financial statements for the company. With the help of Cook, Moore and Associates, Real Estate Appraisers, McInnis will find a fair bid for our tract of land, whether it be in the bustling CBD (Central Business District) of downtown Baton Rouge or on beautiful, waterfront property running alongside the Mississippi River. With a background in Human Resource, co-founder Melanie McKoin will strive to manage the administrative components of Red Stick Baton Rouge. From abiding by certain state and government laws, McKoin will ensure that Red Stick Music Venue complies with all legal aspects in terms of internal and external facets of the business. McKoin will also focus on any and all training aspects of Red Stick Music Venue to ensure that everyone is educated in terms of the business and making it run functionally. Additionally, with experience in advertising and marketing in previous occupations, McKoin will contribute to marketing Red Stick Music Venue in the best way possible in order to brand Red Stick Baton Rouge.
With the vision behind Red Stick Baton Rouge, co-founder Calder Miller will work with the team to fulfill and implement the vision of Red Stick Music Venue. With organizational skills and a plan to construct the site of Red Stick Music Venue, Miller will ensure that the best architects and general contractors are selected for designing and building the construct of Red Stick Baton Rouge.
From previous occupations with focuses in sales, Meredith Murphy is equipped with the skills and abilities that will cater to building and growing the sales of Red Stick Music Venue. By focusing on the logistics of all the various sales components, Murphy will ensure that all sales are consistent with the market and profitable enough to sustain Red Stick Music Venue while potentially growing the business for future endeavors. Additionally, from her experience in sales, Murphy has acquired excellent tact in addressing and handling all aspects of customer service. Murphy will work to ensure that all aspects of Red Stick Music Venue keep customer service a top priority when making decisions and working with all customers.
By playing to each other’s strengths, the five co-founders of Red Stick Music Venue will cover all necessary areas in terms of human resources, financial services, marketing services, and administrative services to ensure that Red Stick Music Venue not only opens but sustains as a business for years to come. The co-founders of Red Stick Music Venue will function as a partnership with each founder sharing the liability of the company. For now, the partnership will focus on building the business and growing it to a sustainable size. In regards to future endeavors, Red Stick Music Venue would like to stay local to Baton Rouge; however, depending on the situation, the partnership may take steps in taking this service to a neighboring state of Louisiana.
9. Sales Strategy
To market and advertise Red Stick Music Venue, the company will utilize various social media sources to highlight the businesses and services provided by the business. Facebook and Twitter will be the primary social media sources for updating the target markets on weekly events and concerts as well as any promotional events that may be offered. Additionally, Red Stick Music venue will rely on the company website to inform the public about Red Stick Music Venue, advertise and promote all events, and sell tickets for all events. By tapping into gorilla marketing with social media promotions, Red Stick Music Venue will capture the attention of a large audience. Social media promotions will range anywhere from credit at the venue’s concessions to upgraded seating. By offering incentives and growing the social media presence, the awareness of Red Stick Music Venue will spread throughout Baton Rouge and more community members will want to experience what Red Stick Music Venue has to offer. Additionally, through direct marketing such as passing out flyers or word-of-mouth, Red Stick Music Venue will diligently strive to contact as much of the community as possible. These outlets for advertising and marketing will put Red Stick Music Venue in a good place for capturing a full audience and keeping the Baton Rouge community constantly up-to-date on venue specific updates, concerts, and special events.
Anyone interested in Red Stick Music Venue concerts and special events will be able to register on the company website to become a part of the company mailing list. This mailing list will update customers via email with any and all information and updates about our venue, which they can sign up for through the Red Stick Music Venue website, regarding concert times, whose playing every week, as well as special offers. From a calendar of events to special promos, the mailing list will help keep community members and customers involved in the monthly happenings of Red Stick Music Venue. The mailing list, as well as the website and social media sources will be the primary sources for communicating frequently with customers and community members. Occasionally the business will participate in face-to-face and word-of-mouth communication, but because of the large amount of people we are trying to reach, electronic communication will be the most effective and efficient method of keeping everyone involved and up-to-date. Additionally, the website will serve as reinforcement to the mailing list. The mailing list will highlight the calendar of events with a link that will redirect viewers to the website in order to purchase tickets. All tickets for our concerts and events will be encouraged through our online sales, which can be purchases with a credit/debit card; however, should customers not utilize the website, they will be able to purchase tickets in advance or via will-call, and will be able to retrieve their tickets at Red Stick Music Venue. Regardless of online sales or in house sales, all purchases will be managed by sales representatives of Red Stick Music Venue, and collected and totaled nightly after all concerts and special events. Along with advertising and marketing Red Stick Baton Rouge, it will be crucial to provide the details and logistics of the business in terms of pricing. The venue in itself will have an occupancy rate of 10,000 people with 4,000 seats covered and an open area for up to 6,000 people. Because there are two types of seating arrangements, the price for tickets will vary. For covered seating, ticket prices will range anywhere from$75-$350; whereas, the cost for standing room only tickets will range between $20- $75. The price will vary for both options due to the variation of the artists, the popularity of the artists, and the overall costs of the artists. For more well-known, big named artists, such as Dave Matthews Band and Widespread Panic, the demand will be greater; therefore, we will be able to capitalize on the demand and charge higher prices for tickets. However, when providing local talent we will have to skew the price in order to attract an audience and be profitable.
In addition to offering live events and artists, Red Stick Music Venue will offer concessions and alcoholic beverages. In terms of concessions and alcoholic beverages, Red Stick Music Venue will offer the following foods at the following prices, which we have collected from previous experiences at music venues and Tiger Stadium: . Food: * Bowl of jambalaya- $6 * Foot long hot dogs- $6 * Burgers- $6 * Cheese Nachos- $4; with chili- $5 * Large bucket of popcorn- $5 * Large pretzel- $5 * Ice cream cones- $3 * Snowcones- $3 | Beverages * Non-alcoholic * Water- $5 * Fountain Drinks- $5-$8 * Alcoholic * Beer (cans)- $5 * Frozen drinks (20oz)- $7 * Mixed drinks- $10 * |
Currently, the pricing strategy is calculated to where ticket prices will cover if not exceed the cost of the artists performing for a certain night as well as the utility costs of the event. The concession prices will focus towards overhead costs. What is left over from each of the categories will go straight towards profits for the business.
Finally, to create the most effective sales strategy necessary, it is vital that all known and hidden costs are in the open. When all costs are known, different prices can be manipulated in order to push the business towards the green and ensure that the strategies are accurate in terms of yielding profits.
10. Financial Plan
This section helps you figure out how much money you need to start the business, how you will make money and how cash will flow. Put the full financial statements in an appendix and provide the key financial information in narrative form in the body of your feasibility study. Be sure to document the logic, sources, and assumptions used to determine specific numbers and trends.
Red Stick Music Venue
FINANCIAL PLAN
Ticket Revenues
Red Stick’s maximum occupancy will consist of the following: * 4000 premium covered seats (Priced $75-$350) * 6000 stand room (Priced $20-$75)
Considering maximum occupancy will not be feasible through the first year, we will take an industry standard of 91%, and slowly extrapolate that out for the next 3 years (Spangler).
So for Year 1, we will assume occupancy of 80%: * For a local band, ticket prices will be at minimum, $20 and $75, respectively: (4000 x 80% x $75) + (6000 x 80% x $20) = $336,000 ticket revenues * For a regional band, ticket prices will fall in between the two ranges, so:
(4000 x 80% x $125) + (6000 x 80% x $35) = $568,000 ticket revenues * For a more lucrative band, ticket prices will be in the upper 3/4 of the price range:
(4000 x 80% x $200) + (6000 x 80% x $50) = $880,000 ticket revenues * For top-tier, premier bands, price skimming will be implemented to the maximum:
(4000 x 80% x $350) + (6000 x 80% x $75) = $1,480,000 ticket revenues
Considering Red Stick’s first 3 years will likely have more local and regional bands and fewer top-tier acts, we will adjust the percentage of shows according to availability of acts, at 150 shows a year:
($336,000 x 40% x 150) + ($568,000 x 40% x 150) + ($880,000 x 15% x 150) + ($1,480,000 x 5% x 150) = $85,140,000 Year 1 Revenue
Concession Revenues
Modeling our concessions strategy after the United Spirit multi-purpose arena, we will outsource our concessions to be handled by a private company. United Spirit Arena provides similar characteristics to Red Stick, so the correlated model should provide similar projections for our concessions.
Receiving 38% of the total revenue from concessions sales (our highest contribution margin commodity), Red Stick will base its number of concession sales on a percentage acquired from United Spirit’s report for Year 1 (Vaughn). This number will reflect a 3% deduction of revenue which is put into an equipment accrual fund, to replace concession equipment.
$322,555 (annual concession revenue) @ (33% less occupancy than USA) =
$216,111.85 Year 1 Concession Revenue @ (80% expected occupancy at Red Stick for Year 1)
= $172,889.48 Year 1 Concession Revenue
Total year 1 revenue from ticket and concessions sales will bring Red Stick in $85,312,889.
Expected Sales and Revenues
Continuing the even extrapolation of attendance through the next 3 years, sales and revenues should increase exponentially for ticket and concessions alike.
Year 1 @ 80% occupancy
Ticket Revenue $85,140,000
Concession Revenue $172,889.48
Year 1 Total Revenue = $85,312,889.48
Year 2 @ 85% occupancy (5% increase)
Ticket Revenue
$85,140,000 x (85% / 80%) = $90,461,250
Concession Revenue
$216,111.85 x 85% = $183,695.07
Year 2 Total Revenue = $90,644,945.07
Year 3 @ 91% occupancy (6% increase)
Ticket Revenue
$90,461,250 x (91% / 85%) = $96,846,750
Concession Revenue
$216,111.85 x 91% = $196,661.78
Year 3 Total Revenue = $97,043,411.78
After the first year, revenue from ticket and concession sales will increase a total of $5,148,360.52.
From year 2 to year 3, revenue will increase to a total of $97,043,411.78, an annual increase of $6,398,466.70.
Costs and Expenditures
Red Stick will incur costs from the initial ground breaking throughout its economic life. These costs will include cost of performers, labor, utilities, advertising, equipment, construction, land, insurance, and administrative expenses.
The cost of performers will vary from artist to artist, but some prices taken from various concerts this past year in Baton Rouge will provide insight into how these costs will vary.
The Benjy Davis Project, a regional band, played at multiple fraternity houses in 2012, at a cost of $8500 a show. Another, more well-known DJ from Boston, Massachusetts, by the name of Kap-Slap, also played shows in Baton Rouge for the same price of $8500. However, an increase in cost might be incurred considering the increased venue size.
For more premium artists, such as The Red Hot Chili Peppers, per show costs could be as high as $750,000 3.
After consulting with Cook, Moore, and Associates real estate appraisal team, a more accurate cost for land and insurance can be determined.
Given similar amphitheaters we think that approximately 12 million should cover all the costs of starting up. This includes construction, permits, and other costs. One venue that we looked at was the Les Schwab Amphitheater because it is both similar to Red Stick in size and targeted amount of attendance. Our source cited that Les Schwab Amphitheater(LSA) cost 1.25 million dollars and was completely financed from private investors. We are asking for 12 million because LSA was built in 2001 and only has lawn seating, while Red Stick will have both lawn seating and covered seating. This increase in expected price is providing a cushion for the difference in the styles of the amphitheater as well as difference in prices over the 12-year period possibly arising from inflation. Another amphitheater we reviewed was the Charlottesville Pavilion that is very similar to Red Stick in amount of covered seats we have planned. Charlottesville Pavilion cost 6 million to construct in 2005. Using that price as a base for comparison we can estimate that the price of Red Stick just for construction should be around 8 million, assuming similar prices and labor costs. The feasibility analysis of the Cedar Rapids Amphitheater expected the cost of insurance to be around 40,000 dollars for their 4,000 seat amphitheater. Due to Red Stick being twice as large as the proposed Cedar Rapids Amphitheater(CRA) it should be safe to assume that our insurance should cost in the area of 100,000 dollars.
11. Feasibility Decision
This is the bottom line. You may have decided that the business is not feasible. If so, it’s better to find out on paper. If you decide there is a good opportunity, however, complete the “Timeline to Launch” section.
Red Stick Music Venue is very much a feasible business idea. As previously stated, Baton Rouge currently holds no local competition for Red Stick Music Venue which is a strength for the business. Bringing Red Stick Music Venue to Baton Rouge will open up a completely unique and innovative market that will appeal to the 230,000+ resident of Baton Rouge, as well as, the non-residential college students who for at least 4 years call Baton Rouge home. The fact that New Orleans is only 80 miles away from Baton Rouge and attracts well-known artists will also be a strength for Red Stick Music Venue. By capitalizing on New Orleans’ music venues and festivals, Red Stick Music Venue will be at more of an advantage for hosting well-known artists on a consistent basis.
Although the group believes that Red Stick Music Venue is a feasible business idea, there are a few weaknesses that will accompany this business. The major weakness that we encountered deals with hosting events on weekends. Because during the beginning of our business we will rely heavily on the New Orleans market, we will have to schedule our events around New Orleans. With many concerts being on Friday or Saturday nights in New Orleans, this limits the availability for Red Stick Music Venue. After much thought, it seems that Red Stick Music Venue will plan events throughout the week and possibly host more local artists on the weekends.
Another weakness that the group encountered is Louisiana weather. With inconsistent weather conditions in Baton Rouge, the weather may or may not play in favor of the business. Researching various live entertainment venues, it has been decided that rain or shine, Red Stick Music Venue will host planned events. With covered seating, patrons will be able to avoid inclement weather; however, for standing room only patrons it will be communicated that they will be at their own discretion in regards to weather, and that they should dress accordingly, i.e. Rain boots, ponchos, umbrellas, etc.
Overall with weighing the strengths and the weaknesses, the group does believe that this business idea would be a great asset to the Baton Rouge community. With startup costs and artists’ costs, the business will accrue a large expense, but with such a great market this business will do very well in Baton Rouge. The business would yield great amounts of revenue to Baton Rouge, as well as, provide a unique segment within the entertainment sector.
12. Timeline to Launch
With securing funding, building the venue, and breaking into the music industry, Red Stick Music Venue will take approximately 3 years to launch. The major task at hand will be securing funding. Because Red Stick Music Venue will have a large startup cost, the co-founders will reach out to the local incubator to find local companies who would be interested investing in the business. In addition to contacting the incubator, the co-founders will begin working to obtain business loans. Co-founders Danny McInnis and Calder Miller will take the lead on securing funding with banks; whereas, all the co-founders will search to secure investors.
Additionally, the co-founders will reach out to the local businesses that surround the down town area such Roux House, Schlitz and Giggles, City Bar, and The Office, with hopes of building relationships in terms of marketing and advertising. The goal will be to have these businesses advertise the upcoming events of Red Stick Music Venue, and Red Stick Music Venue would return the advertisement at their events.
Over the three years that it will take Red Stick Music Venue to launch, many milestones will be anticipated. The first and most important milestone will be securing funding and investors. Without this milestone, Red Stick Music Venue will not exist. Ideally by January 2015 funding and investors will be secured. After securing funding, the next major milestone will be the construction of the venue. Because construction will entail the covered seating area, standing room only area, staging, green rooms/dressing rooms, concessions, lavatory facilities, and parking areas, the construction will roughly take about a year, placing the next expected milestone for January 2016. During this time, Red Stick Music Venue will have to hire short-term work in regards to contractors, engineers, and builders.
While construction is taking place, cofounders Meredith Murphy and Melanie McKoin will work on building relationships in the music industry. By reaching out to artists who frequent the New Orleans area, Murphy and McKoin will begin spreading the word about Red Stick Music Venue among the music industry and solidifying acts for the grand opening. Once the acts for the grand opening have been booked, McKoin and Murphy will begin booking artists for the upcoming shows for the year. The hope will be to have main events scheduled and on the calendar to advertise before the opening of the venue.
Upon completion of construction, cofounder Elliot Beatty will work on the technology aspects. Securing adequate equipment and light for the staging will be just one aspect of technology that is Beatty’s responsibility. He will secure the correct technology from aspects of security to aspects of cash registers for concessions and ticket sales. Everything technology related Beatty will secure. Additionally, during this time Red Stick Music Venue will have to hire short-term workers in regards to installing equipment and set up needs. Prior to the completion of construction, cofounder McKoin will draft a marketing plan that will entail how Red Stick Music Venue will be branded, the ins and outs of advertising and marketing the business, and the outline of how the grand opening will be marketed and advertised. The co-founders will take this plan and begin building the brand of Red Stick Baton Rouge well in advance before the venue is built. By advertising throughout Baton Rouge and even surrounding smaller communities, Red Stick Baton Rouge will promote the opening event that will occur in the Spring of 2017. After three years of preparing the venue and building relationships within the industry, the co-founders believe that Red Stick Music Venue will be able to successfully launch and wow the Baton Rouge community with live entertainment for populations of all ages and tastes of music.
13. Bibliography
This section lists your sources. Use one of the accepted formats, e.g. APA or MLA formatting.
Alternatively, you may use footnotes.
"Food & Beverage." Verizon Wireless Amphitheatre at Encore Park. N.p., n.d. Web. 02 Dec. 2013. <http://www.vzwamp.com/plan-your-visit/food-beverage/>.
Hartmann, Graham. "Metallica Red Hot Chili Peppers Among Highest Grossing Touring Acts of 2012." Loudwire. N.p., 3 Jan. 2013. Web. 14 Nov. 2013.
NOTCM. 2013. "Music Clubs." New Orleans Music Venues. New Orleans Tourism Marketing Corporation, n.d. Web. 27 Nov. 2013.
Spangler, Ted. "Concert Numbers Are Up." American Songwriter. Live Nation, 8 Sept. 2008. Web. 14 Nov. 2013.
Porta, M. 2013. How to Define Your Target Market. [online] Available at: http://www.inc.com/guides/2010/06/defining-your-target-market.html [Accessed: 26 Nov 2013]. Vaugh, Lauri. "Beer Sales during Concerts May Boost Arena Concession Revenues." Lubbock Online. AJ Media, 24 Dec. 2002. Web. 14 Nov. 2013.
14. Appendices
Overall, this looks good, though not having seen your financial sheets, there’s still a lot missing. I think you may want to plan on more than 50 shows per year if you can swing it – the more time your space is vacant, the more money you’re losing to maintain an empty venue. Now, that may not be feasible for your first year, but it’s a good goal. Your financials are going to be complicated by employment issues – you’ll need to run your three years of financials (post opening) including the staff you need for security, tickets, etc. including employment costs beyond salaries. You’ll need those for the final paper. It sounds like you did good research on the costs of the facilities and a good way to simplify your concessions.
