BUSINESS MODEL

Introduction
Mr. Hans recognized a need for a store in the area after a neighboring store
closed. Mr. Hans conducted a resident's survey asking about the need for a
corner store and support was the community overwhelmingly supported the
concept. There are no such stores within a 8-block radius, and the target
market will include local residents both on and off reserve.
Mr. Hans has extensive retail experience in both grocery and sundry sales
and
has identified four primary categories of product; pop/chips; toys; taxable
cigarettes and food products.
The Principal, Mr. Hans will, upon approval of funding, renovate the building,
and purchase the necessary equipment and inventory.
Products and Services
Hans's Convenience Store will be a full-time convenience store operating 7
days a
week, from 8:00 a.m.-10:00 p.m. selling; pop/chips; toys; taxable cigarettes;
and
food products.
The store will offer friendly and personalized service, reasonably priced
merchandise,
tax exemption for status customers and a convenient location
The Customers
Client Base:
Hans's Convenience Store has a potential target market, as follows:

 1000 local residents within the 10-block radius

 680 students from multiple Elementary School, parents &
staff
 200 local Bingo players, held 4 times per week at the community hall
next door
 30 Warehouse employees (1/2 block away)
 Sports Bar patrons
Client demographics include local residents from all age groups and
socioeconomic ranges, consisting primarily of families. A large secondary
target
group will be children and teens that regularly purchase candy, soft drinks
and
other fast-grab foods.

The average customer that the business will target will be from all age
groups, with
an average household income of approximately $45,514 (2018-Statistics
Canada).
Many households have both parents in the work force, 63.6% of Canadian
women
with children younger than six worked outside the home (Statistics Canada,
2017).
Based upon an average pooling of clients it is estimated that Hans's
Convenience
Store client breakdown based upon per 1200 clients.

The Location
Hans's Convenience Store will be a convenience store to be placed at 8 th
Street, McKercher Drive, Saskatoon, Saskatchewan S7H 5L4. This is
strategically located within the vicinity of numerous residential, multi-cultural
areas.
The Opportunity
There is the opportunity to expand the product line(s) that the store carries.
Hans' Convenience Store anticipates that within the first two years of
operation that it may qualify for a tax-exempt tobacco license and lottery
goods. There is also the potential that the business may be able to employ
local people part time.
The Owner
Mr. Hans is a longtime resident of 4040 Tamarind Place, 8 th Street East. Mr.
Hans has had extensive retail experience that is crucial to the type of
business he is opening. Mr. Hans’ experience includes work at a retail
grocery store and liquor store sales. He has worked in retail sales for 5 years
and is experienced with all aspects of daily
operations including ordering, receiving, budgeting, merchandising, and daily
banking. Mr. Hans is particularly skilled in public relations, is very organized,
is
able to work independently, is reliable, dependable and hardworking.
Legal Organization
Hans’ Convenience Store will have two employees, one full-time and one
part-time. Mr. Hans will be the sole owner and primary operator for Hans'
Convenience Store. Mr. Hans has extensive retail experience in the retail
grocery business as a supervisor for a local supermarket and has worked at a
high volume hardware-store and also a government liquor store. Mrs. Hans
will assist in daily operations of the store, and will handle bookkeeping and
financial reporting. Within five years it is anticipated that the company would
analyse the viability of hiring a another part-time employee for 4 hours per
day however at this time there are no plans to hire any more employees
within the first three years of business.

FEASIBILITY
Location Analysis
The store will be situated in a 1400 square foot building along with other
establishments such as Sobey’s, Rexal, and Little Caesar’s. Multiple sports
bar as well as a gas station will also be within the parameters. It will be
renovated with the appropriate shelving, refrigeration and
cash counters required for operation. The building will consist of 3 rooms, an
office, a washroom and the main store area.
Site Analysis (factors)
Hans's Convenience Store will succeed due to a variety of factors.

Local Need: The customers that the store will target are the local residents.
The area has no other such convenience store in a 8 block radius, with local
residents grocery needs being
filled only by Sobey’s and 7-11.

Proven Market: A small convenience store located at the proposed business

site
did exist in the neighborhood until 6 months ago, when it
was forced to close due to the family’s relocation to another province. This
business had a
proven market that Hans' Convenience Store will capitalize upon.

Management Experience: The experience that Mr. Hans brings to the

endeavour is invaluable, he has product knowledge, is familiar with large
chain
pricing and techniques, and their sales strategies. Mr. Hans has established
valuable wholesale contacts which he will utilize in the new business. In
addition, Mr. Hans has an excellent work
ethic, having held down two jobs that provide his excellent references.
Finally, with regard to management experience Mr. Hans has an excellent
relationship established with the necessary suppliers for this venture.

Community Support: Mr. Hans conducted a survey within eight blocks of the
proposed site and the results indicated that a small
convenience store will elicit overwhelming support for the concept.
Long-range plans include the acquisition of a tax-exempt cigarette license for
the
store, and a lottery license (scratch cards) from the provincial government.
These are
time-consuming processes, but these product lines will be applied for in the
first
quarter.
Site Expenses
Financial information for this Operation
Item Cost
Business Start Up Costs
$3,500.0
1 Renovations
0
$4,000.0
2 Inventory
0
3 Shelving $900.00
4 Cooler Lease Deposit $200.00
$1,000.0
5 Air Conditioner
0
6 Signage $500.00
7 Cash Counter $500.00
$5,300.0
8 Operating Capital
0
$
Total 15,000.0
0

The building was leased out by Mr. Hans to a family business that relocated,
and is
fully wired for electrical, security and phones, and is on the residential
property of
the Mr. Hans. The residents of the various communities within the area have
provided their full support and verbally agreed to support this venture.
Production Process:
Daily retail operations will consist of the following:

 Open store, disarm alarm

 Cash count, turn on necessary machinery, debit machine, etc.
 Do books from previous day, check inventory, order as necessary
 Handle sales
 Close out cash and balance
 Close store, arm alarm
Market Potential
Hans' Convenience Store anticipates growth to be based upon one primary
client
group, the local community located within an 8 block radius. Local business
will be generated through an aggressive marketing
campaign to local residents, and the local bingo hall, and nearby daycare
and preschools.
It is anticipated that the market penetration will increase over the next five
years
from 5% of local residents spending to 10%, and the client market area will
increase
to a 15-block radius.
Competition
The direct competition in for Hans's Convenience Store consists of one
company:
1. 7-Eleven

 Address: 8th Street, McKercher Drive, Saskatoon, SK

 Years in Business : 8 years
 Market Share: 10%
 Price/Strategy: Same
 Product/Service: Same product, lower levels of client service.
 Advantages: longer hours, greater purchasing power, variety
of products, gas-bar, lottery license.
 Disadvantages: Distance
 Hans's Convenience Store’s indirect competition is 1 large grocery
retailer, as listed
below:

1. Sobey’s

 Address: 8th Street, McKercher Drive, Saskatoon, SK

 Years in Business 12 years
 Market Share 10%
 Price/Strategy Same
 Product/Service Greater buying power and variety of products
 Advantages longer hours, more products, large promotional
sales and industry name.
 Disadvantage Non Personalized service
Sales Forecast
Expected sales from the first three years of operations:
Year 1 Year 2 Year 3
100,000 $ 115,000 $135,320

Protecting the Business

MARKETING
Image
Business Name
Business Name: Hans's Convenience Store
Service/Product Mix
Hans’ Convenience Store will be serving, aside from local goods,
international products, particularly Asian food and non-food products of
different varieties.
Price
  Pricing will be set at 20%-80% mark-up, dependent upon the following
categories:
 Pop/ Chips 30% mark up
 Toys 80% mark up
 Cigarettes 80% mark up
 Food Products 40% mark up
No credit will be offered to customers. Sales will be cash, Interac or credit
card.
Suppliers will be on a C.O.D. basis, until 30 net terms can be established
Distribution
Promotion
Marketing/ Promotion:
-Hand deliver promotional flyers to prospective customers
-Fax grand opening specials, flyers to local band offices, businesses

Strategy
Hans's Convenience Store will attract local clients and foster loyalty with
competitive
pricing, convenient location, and friendly service. In addition, the store will
offer monthly specials, draws, as well as the inclusion of promotions.

Mr. Hans may join an industry association such Retail Council of Canada (for
a nominal
annual fee), who provides the business with cost-saving services (such as
low
merchant rates on credit cards) and practical advice through newsletters and
workshops.

Local Advertising:

Flyer distribution: flyers will be distributed in the local area on a monthly

basis advertising specials, draws and promotions.

Promotion Evaluation
OPERATIONS
Space and Equipment
Description of facility requirements:

Electronic Equipment:
Existing Required
Value Budget Cost
Equipment Equipment
Computer $ 3,400.00 Air Conditioner $ 1,000.00
Printer $ 200.00
Automobile $ 6,500.00
Software $ 1,500.00
Total: $ 10,700.00 Total: $1,000.00
Furniture/ Fixtures:
Required Furniture/ Fixtures Budget Cost
Shelving $900.00
Signage $ 500.00
Cash Counter $ 500.00
Total: $1,900.00

Proposed Floor Plan

Provided that the plan will be approved, the floor plan of this store will be as
follows:
Logistics
Method and Procedure
Systems
Organization
Christoph Hans will be sole owner and primary operator of the business. He
will be
responsible all aspects of operations. Mr. Hans’ experience includes work at
a retail
grocery sales, a high volume hardware store (undry) sales, and liquor store
sales. He
has worked in retail sales for 15 years and is experienced with all aspects of
daily
operations including ordering, receiving, budgeting, merchandising, and daily
banking.
Mr. Hans is particularly skilled in public relations, is very organized, is able to
work
independently, is reliable, dependable and hardworking. A resume and 2
letters of
reference are attached in the appendices of this document.
Mrs. Hans will assist in daily operations of the store as needed. Mrs. Hans can
assist
with bookkeeping and financial reporting, but is not anticipated to draw a
wage for
this casual work within the first five years of operation.
Regulation
FINANCES
Startup Requirements
Aside from the capital required for the creation of this business,
requirements such as:

 Licenses, permits, and insurance

 Business license
 Business insurance
Owners Investment
Borrowed Money
To achieve the build-up of his establishment, Mr. Hans will be loaning from
the RBC Royal Bank located 2802 8 Street East, Saskatoon, SK. The overall,
including the bank loan as well as Mr. Hans’ equity distribution, will be as
follows:
Bank Loan: $12,000.00
Equity Contribution: $3,000.00
Total Project Cost: $ 15,000.00