Something in the world of floating have you stumped?
Show Highlights
Do you need a business plan if you’re not building a business from the ground up?
Graham and Ashkahn chime in and give a solid “maybe” as a response. It depends on a lot of factors, for sure. Do you already have financing? Are you maintaining the existing business model or revamping it?
Show Resources
FTS Product – Business Plan Package
Listen to Just the Audio
Transcription of this episode… (in case you prefer reading)
Ashkahn: Hey, everybody.
Graham: All right, another day, another podcast.
Ashkahn: Yep, yep. We actually have a slogan now, huh?
Graham: Kind of. I’m Graham.
Ashkahn: I’m Ashkahn.
Graham: And today’s question is, “I’m buying an existing float tank …” man, a lot of purchasing float tank questions.
Ashkahn: Recently, yeah.
Graham: Yeah, recently. All right, so, “I’m buying an existing float tank center. Do I still need to have a business plan?” Well-
Ashkahn: Yeah, you should definitely purchase one from some sort of reputable float tank business plan company, I would say. That would be my advice.
Graham: Not all business plans are made equal, okay?
Ashkahn: There’s really only one, I think, that would be justified to purchase.
Graham: Yeah, there’s only one that’s made equal to itself. That’s it. That’s ours.
Well, okay, so there’s two ways to look at this, right? Or I guess there’s just different levels of business plan and business planning, and you didn’t capitalize yours. You obviously mean lower cased business plan.
Ashkahn: The informal.
Graham: Yeah, but should you have a plan of how you’re going to run your business and staff it and market and make a profit and all those kinds of technical details? Absolutely. I mean, you need them. You’re about to run a business, you know?
Ashkahn: You should have a plan.
Graham: Yeah. So, in that sense, you need to plan.
Ashkahn: For your business.
Graham: In the other sense, like, do you need a robust-
Ashkahn: Business Plan.
Graham: …30 page written business plan and five years of projected financials and kind of this more robust, capital B-P Business Plan? I mean, only if you’re financing the purchase of your float center, really. In that sense, it’s the same way as if you were building this from scratch, which is, it’s going to cost money to purchase and you can often get loans or investment for a purchase of something as well, just like you can for building it out. So if you’re doing that, then you probably need to have about the same diligence with your business planning that you would if you were starting from scratch. I guess the nice thing is some of those numbers can be filled in with the business that you’re taking over. Rather than needing to make projections for what your first year is going to be when you’re drawing on a totally blank canvas, you have someone to give those to you, and as far as things to market and what their usual customers are that are coming in.
A lot of these things that are guesses before you’re getting into a new business are solid and, again, should be provided in a really nice form by the people you’re purchasing this thing from. So, it’ll certainly make the planning easier.
Ashkahn: Yeah, I mean, yeah. A lot of times people are making business plans to go to a bank or investors or something like that, and finance the start-up costs, and if you are needing to finance the purchase of another float center, they might ask you for a business plan in that context, too.
Graham: Yeah, they likely will.
Ashkahn: It’s just going to be a different sort of beast in either way, right? When you’re writing a business plan to get a loan to start up a float tank center, you’re talking about, like, “Here’s the type of space I’m going to be looking for, here’s why I think this neighborhood would be good.” You’re making a lot of projections about why you think this area would enjoy a float center and there’s just so much more kind of intangible stuff going on there than if you’re purchasing an existing business that has already a track record of how many customers are coming in. Like, the bank’s probably going to want to know what are you going to do to improve these numbers or get this profitability higher or-
Graham: Or why is buying a float tank center here especially valuable right now?
Ashkahn: Why are they selling it? Why is it even up for sale in the first place? Those are the sorts of questions. And if you’re financing it yourself, this could be a lot more casual. You may just have that information from the float center you’re buying it from and even maybe have operational information.
Graham: I was going to say, an operations guide in that case is almost more … well, I don’t know, there’s still the whole marketing side of things and how are you going to make this valuable and in that sense, it is more operational. It’s kind of like the logistical business plan of how are you going to do this, and rough costs. Like, roughly what are my utility costs going to be per month, and hopefully, like Ashkahn was saying, that’s provided by the center you’re purchasing, and a lot of those variables will be stable. You still need to figure out what the heck you’re going to do when you take over these keys and grab your center. That’s going to exist no matter what.
Ashkahn: But yeah, I mean, with the capital B-P, I wouldn’t … if the center has finances you can look at and the basics of running their place-
Graham: If they’re not going for a loan.
Ashkahn: If they’re not going for the loan. If some of that stuff’s already there, I wouldn’t be tempted to sit down and write a formal 50-page business plan.
Graham: I’m pretty anti-business plan except for the purpose of raising money. I think a lot of that time that you’re going into detailed financial projections for five years could be better spent on-
Ashkahn: Running something in the real world.
Graham: … a little more day-to-day kind of things. So, I think we’re on the exact same page for that. So, again, the answer is maybe, for whether or not you need a business plan, but you definitely need a firm sense of operations and an operational plan for what you’re going to start instituting right when you take over.
Ashkahn: Yeah, especially because you’re flying a plane mid-flight at that point. The thing’s got to keep running from when you take it over.
Graham: Maybe you’ve never been a pilot before.
Ashkahn: Maybe the wing’s a little broken. All right, well, go dream about that for a while, and if you have any other questions, go to FloatTankSolutions.com/podcast.
Graham: Yeah. You can type those in, letter by letter.
Ashkahn: Yeah, and the little typewriter that we place behind our eyeballs will type them into our brain in sync.
Graham: I’m going to think about that now.
Ashkahn: Type that out .
Graham: I can’t get that out of my head. All right.
Ashkahn: Bye, everybody.
Graham: Talk to you guys later.
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In honor of our newly minted, fresh off the press, prize winning Construction Packet, we are releasing one of its more succinct components, the Location Checklist, as a free resource. Don’t let the fact that it’s only one page fool you – this set of questions breaks down the major site and location considerations for your center.
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If you are looking to open a center, at some point, you have to face the reality that you’re going to need to spend, and thus track down, a good chunk of money. There are many ways to fund a float center – personal capital, family and friends, sending travel funds to the exiled Liberian prince that you met on the internet and using the forthcoming reward money, etc. This post, however, will focus on financing using bank loans.
A Peek Into Our Construction Packet: Planning Your Space – Square Footage and Number of Float Rooms
For anyone opening a float center, one of the earliest questions they’ll have to tackle is, “How big should my space be?” This can be one of the most difficult queries to answer, because it hinges on many variables.
Will you be offering other services? What types of tanks are you getting? What other rooms will your space need? If you’re planning on installing a float tank water slide, that’ll take up extra space, too. I know it’s unreasonable, but Jake really wants someone to do it.
All of these questions aren’t even factoring in thinking about profit margins. It quickly becomes a daunting task that can feel overwhelming.
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At Float Tank Solutions, our main goal is simple.
We want to provide access to floating for as many people as possible. That’s why, this week, we are opening up our blog to our friend, Shane Stott. Shane, an avid float ambassador, life coach, and founder of Zen Float Co., will walk us through the essentials of running a Kickstarter campaign, with a highlight on his current efforts to raise money through Kickstarter for a documentary on floating.
