A New Venture – A Pawnshop Chain Store
The following research will be the deciding information as to the decision on whether or not a pawn store will be viable within Deltona, Florida. Deltona is located in Volusia County where there are approximately thirty pawn shops within Volusia County at this time and currently three reside in Deltona, Florida, with an estimated twelve in Daytona Beach, Florida. The pawn store being considered in this research and feasibility study has many needs within its targeted market, because of the community size and need for a pawn store to supply the community with options for their financial and shopping need’s, Deltona is a very good location to start a shop. The needs and services that will be offered are check cashing, payday loans, pawn loans, jewelry buying exchange, coin shop, outlet for unwanted household items, sporting equipment and many more items, the shop will also offer auto title loans, with a lot for car sales to the public, and the last option will be hunting goods and firearms for both sale, and pawn loans. The research will discuss demographic information, the market environment, technical and operational requirements, as well as some financial projections for the territory and marketability of the pawn stores future outlook, for the consideration of store sustainability. The overall goal of this venture is to bring a new type of venture into the pawn market, and that is the end result to be sought with this feasibility study. The question of, can pawnshops be franchised in the manner that exists in fast food and other companies.
What is a pawnshop?
The pawnshop, consist of many intriguing parts of the entrepreneurial spirit, finance, sales, and money. The main reason a pawn shop is in existence is for helping the people who could not otherwise find or secure a loan for their needs at the time. Banks will loan money, but people with collateral that is not substantial or credit that is poor stand little chance of getting a bank loan, or securing a small cash loan for their needs at the time, this is where a pawn shop comes into play, the shop will loan based on the item being used for collateral and the sum of money needed, generally the loan period will vary based on the state that regulates the pawn shop. The customer has the choice of either selling the item or securing the loan for a period with interest being paid for the amount of time used, if the customer decides not to pick up the loan, the shop will then sell the item for an amount based on a used marketable price. The pawn shops deal in a win-win of high finance, the loans being given are high risk at times therefore the usury rate on the loans are generally at high interest amounts. Once the collateral has been fore-fitted by the customer it becomes the property of the pawnshop to sell to recoup their loan back plus a profit on top of the lost interest and this creates the revenue stream from sales. Many pawnshops now offer many different services like check cashing and payday loans, a payday loan is done through a secondary loan facility securing the funds for the borrower, these banks are in South Dakota, and run by the various Native American Tribes. The way the loan works is the pawn shop fills out all loan information and submits online to the loaning institution for approval, once approved the bank will deposit the funds into the customers bank account within twenty four hours. The loan is then paid in either two weeks or a month, based on the payday frequency of the customer. The bank will deduct the loan from the customer’s account and then charge interest on the amount. If the funds are not available the loaning institution will charge fees for NSF charges and start collections Pawn shops serve various needs of the customer on a daily basis, the pawn shop is considered one of the oldest professions in the...
References: Angel Investors. (2011, December 20). Retrieved from Everyman Business: http://www.everymanbusiness.com/finance/angel-investors/
Alterowitz, R., & Zonderman, J. (2007). Financing Your Business made easy. Canada: Entrepreneur Media Inc.
Bradberry, J. G. (2011). 6 Secrets To Startup Success. New York, NY, United States: AMACOM.
Demographics - Retail Sales Potential Summary. (n.d.). Retrieved June 17, 2013, from DEMOGRAPHICS NOW: http://library.demographicsnow.com/?skey=9DBOF131C400443D85911D85F6F8F733
Five Things to Do Before Writing a Business Plan. (n.d.). Retrieved June 17, 2013, from Business Feasibility Study: www.feasibleproject.com/
Hisrich, R. D., Peters, M. P., & Shepherd, D. A. (2010). Entrepreneurship. New York, NY: Mcgraw-Hill.
How To Write A Feasibility Study. (n.d.). Retrieved June 16, 2013, from Ready Planning: http://readyplanning.com/how_to_plan_/feasibility_howto.htm
Pawnshops. (n.d.). Retrieved June 17, 2013, from Division Of Consumer Services: http://www.800helpfla.com/pawns.html
Please join StudyMode to read the full document