Breakaway Bicycle - Business Plan
Executive Summary
Breakaway Bicycle Company designs and builds custom bicycle frames to the exact specifications of the finest road and mountain bike racing professionals in the world. Breakaway has earned this right because its founder and master builder, Mike Giro, hand crafts road and mountain frames that satisfy the one common specification of all competitive cyclists — it helps them to win races. Since 1990, Breakaway has designed and built bike frames for racing professionals and those biking enthusiasts who take their riding seriously and want to own the best equipment. As more and more of the population gain an interest in competitive cycling, the demand for custom built bicycles has also increased. Many individuals, particularly those interested in mountain biking, have found that there is a tremendous interest in competitive mountain biking which include grueling cross-country races and gravity-defying events such as the “in your face” downhill racing. Based on marketing projections, this interest increased following the 1996 Summer Olympics in Atlanta where mountain bike racing made its debut as an Olympic medal event. To meet the expected demand for custom built bike frames that can handle this type of riding, as well as road racing, Breakaway is seeking the financing necessary to add new workstations and hire additional designer-builders. The cost to purchase and install the additional workstations is $60,000. The additional salary expense is projected to increase labor expenses by $6,250 per month. If this investment is made, though, marketing projections and written commitments from several mountain bike racing teams in the U. S. and Europe reflect a 25 percent increase in bike frame sales. This increase translates into sales revenue of $1,390,800 for 2000 and $1,619,600 for 2001.
Introduction
Breakaway Bicycle Company was started by Mike Giro in 1990 and began building high quality hand-crafted bicycle frames. Because these bike frames were
Breakaway Bicycle Company designs and builds custom bicycle frames to the exact specifications of the finest road and mountain bike racing professionals in the world. Breakaway has earned this right because its founder and master builder, Mike Giro, hand crafts road and mountain frames that satisfy the one common specification of all competitive cyclists — it helps them to win races. Since 1990, Breakaway has designed and built bike frames for racing professionals and those biking enthusiasts who take their riding seriously and want to own the best equipment. As more and more of the population gain an interest in competitive cycling, the demand for custom built bicycles has also increased. Many individuals, particularly those interested in mountain biking, have found that there is a tremendous interest in competitive mountain biking which include grueling cross-country races and gravity-defying events such as the “in your face” downhill racing. Based on marketing projections, this interest increased following the 1996 Summer Olympics in Atlanta where mountain bike racing made its debut as an Olympic medal event. To meet the expected demand for custom built bike frames that can handle this type of riding, as well as road racing, Breakaway is seeking the financing necessary to add new workstations and hire additional designer-builders. The cost to purchase and install the additional workstations is $60,000. The additional salary expense is projected to increase labor expenses by $6,250 per month. If this investment is made, though, marketing projections and written commitments from several mountain bike racing teams in the U. S. and Europe reflect a 25 percent increase in bike frame sales. This increase translates into sales revenue of $1,390,800 for 2000 and $1,619,600 for 2001.
Introduction
Breakaway Bicycle Company was started by Mike Giro in 1990 and began building high quality hand-crafted bicycle frames. Because these bike frames were