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Julie Brunelle

Creating an Artful Life.

58

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Heritage Bikes and Rentals

HERITAGE BIKES AND RENTALS

Heritage Bikes and Rentals is a small business located in a small, beautiful, high-traffic, tourist town. The town and its surrounding area are well-known for its many festivals and historical attractions. Heritage Bike and Rentals will offers many different types of services to assist its client in experience the highlights of the town and surrounding area with from hourly/daily bike rentals, and safety equipment, to guided trips and camps.

LESSON #1: Business Model:

  • Assets: We will have a storefront located on the main street, with bathroom and shower facilities, lockers, and bike racks. We have a fleet of 30 new, safe and great quality GIANT bicycles for all age groups. We have 30 helmets and 10 bike locks. WE will acquire bicycle repair tools and a bike repair stand. WE have a support van and 2 bike racks. We will acquire product inventory of bike parts, bike accessories, sports drinks and snacks. We have a long-standing association with the biggest bike rental company the next large city. We have a long-standing association with one of the biggest bicycle tour companies in Canada.
  • Human Resources: One of the Co-owners has 10 years experience in the industry who will plan the trips and itineraries, makes community associations and be in charge of major business clients. I have 12 years experience as a Customer Service representative, with managerial and cashier experience will be manager in charge of the employees, store-front customer service and banking. We will hire a business accountant, part-time employees as guides and cashiers. 
  • Customers: We have a multi-sided customer segment, each with varying needs and desires. That said, a majority of cyclists are interested in more active holidays and discovering new things. They are health conscious, allured by diverse natural environments, local features, cultural/historical attractions and festivals.
    • The cycling enthusiast: experienced riders needing equipment, product, support, facilities and snacks. Age demographic is approximately 53 years old with income levels of $75,000-100,000. They are interested in longer, somewhat more challenging trips with specific, interesting destinations. Wireless technology dependent, and may be interested in planned guided tours.
    • The tourist: the segment can be divided into 2 parts: the walk-ins and the planned tourist. Within each group, there will be clients that are interested in trip-cycling, tourist cycling and/or Family Cycling. In each of these groups, there may be interest in guided tours.
      • The Trip-Cyclist enjoys spending time in Nature, with rides that have a relative modest intensity. They are interested in looped trips of 25-50km, stopping at 1-3 local attractions, or with a specific destination. They are allured by experience, and what they might find along the way.
      • The tourist cyclist wants to experience the local, natural beauty, with pre-planned looped paths in and around the town, seeing local highlights, with many stops, with varying times from 1 hour rides to whole day experiences.
      • The Family Cyclist is desiring to enhance internal family ties, mutual understanding and promote a healthy lifestyle. They need safe and easy-going trails, with different types of programs depending on different type of families (age).
    • School Tours: Teachers seeking to include physical activity and learning in their curriculum. They are interested showing historical and regional highlights to their students. They need planned trips, with some interesting rest stops, and an easy/moderate level of difficulty, and a very high degree of safety.
    • Summer Camps: Parents seeking to give their children and active learning experience, focusing on health, and regional highlights. They need trips that are very safe, with an easy/moderate level of difficulty (depending on Age Group), with a medium degree of planning.
    • Specialized Tours: Tourist, and non-tourists seeking theme specific, guided trips to explore local attractions, and destinations. They need planned trips with some resting stops, and a moderate level of difficulty, and moderate level of safety.

What is hard? At this point, the most difficult part is finding a secure location from where to run the business. To be able to capitalize on the walk-in clients, it is important to be on/ or right off the main strip. As this is a seasonal business from April to October, we are interested in a rental property with the option of a 6-month lease.

 What is unique? We are the only bike rental shop in the whole county. The possibility of linking small businesses, and local farms, with eco-tourism in the area makes this project unique and viable.

 What is repeatable? The model already exists and is repeatable. Rent a location is a high-traffic tourist area, buy a fleet of good-quality bikes, organise varying trips and tours for the different client segments.

Lesson 2: Freelancer or Entrepreneurship

 I’ve been a Freelancer many times in my life, and every time my businesses have failed because of my inability to outsource some of the work. Each time, I became overwhelmed, and lacked the knowledge to hire staff, and/or the commitment to bring the company to the next level of expansion. I have learned, as a writer, to trust the input and knowledge of my book agent, the book designers and publishing agents to complete the finished product. My job is to write, and I let the others do what they are best at. I will take this knowledge and apply it to this new endeavor.

 In this business, I am an entrepreneur.

  • In the starting stages, my partner and I will be doing much of the work. We each have areas of speciality and expertise; and we will both be working within our strengths and interests. For all other areas, we will hire people to complete tasks, such as retail sales, book keeping, accounting, and guiding.
  • As we get busier and our services are more in demand, we will hire a manager to run the store, and manage the employees. We will hire someone for promotion, advertising and social media. And we will hire qualified bike mechanics. So that we can continue to create new and exciting products, and plan for expansion.
  • One of the advantages of the business model is that much of the cash flow is in direct sales, from a store-front along the main street of a high-traffic tourist town. By providing a wide-ranging number of services to the varying types of customer with excellent customer service, we can ensure the cash flow necessary that will allow us to work primarily as manager and developer to service our higher paying clients. Although we offer our services to the everyday tourist, most of the profits will be created by hosting large business groups and school groups. 

Lesson #3 - Funding

Fund your business

  1. Do you need money for this business? Yes, and no. We have already purchased the most expensive items, which is that fleet of bikes. We have purchased the bells, helmets and locks. We have a support van and bike racks. We will need funding for all other assets: rent for store space, bike repair tools, bike repair stand, a POS system, product inventory of bike parts, bike accessories, sports drinks and snacks.
  2. Does more money increase the chances you will reach positive cash flow? At the beginning, pre-season advertising to schools and businesses is crucial for the business to reach positive cash flow as this is our primary source of profit.
  3. Profitability? Considering this is a seasonal business, based on 6 months of business, the profitability is high, see #5
  4. What are the assets the money will go to pay for? See #1
  5. How long before the money invested starts turning into money returned? Each bike needs to be rented for 28 hours for it to become profitable. It is only by focusing on organized guided tours that we can ensure that each bike will turn a profit. Most Tours are about 3 hours long, so we have to ensure that we have 9 tours per year, which can be accomplished easily within the first month. Then, considering rent and all other start-up costs, the estimated time where invested most will be returned is 2 months.
  6. Do you hope to sell this company? Not within the next 5 years. For how much? That will depend on how many outlets have been created. What is the gross margin of what you'll be selling?
  7. How long will it take you to reach scale? We hope that after 2 years, we will be able to reach scale and open to 5 more outlets around the county.

 

Given all this, and what you learned in the video, what sort of funding are you seeking? We will attempt to use our savings to fund this venture. If needed, we will use our personal line of credit to fund the rest.

Lesson #4: HIRING

If we can agree that a key part of your business is going to be your people and what they contribute, can we also agree that some hires are better than others? YES.

In this part of the 7-part plan, you're going to commit (not just describe, but commit) to what your human resources look like.

  1. Who are the first employees you need? We will need a bookkeeper, a guide, a cashier, and a bike mechanic.
  2. Where will you find them? We will begin by having a hiring session, after advertising in the local papers. We are looking for people who have a passion for cycling, bikes, community building and outdoor adventure; who are out-of-the-box thinkers, who are dynamic, positive, and passionate about people and adventure.
  3. Why would they join you? They would join us because of our passion for cycling, for community building and adventure. We are fun, dynamic, people who want to build something meaningful for the community, where people get a sense of belonging, of camaderie, fun, and wellness. Our clients want to feel good about themselves in terms of health, of community, and being part of something larger that is “good”.
  4. How will you tell the good ones apart from the convenient ones? The good ones will not only discuss their love of cycling, but will also discuss community building, relationships, and how they can contribute to the company. They can see our big vision, and see how they can contribute and make it better.
  5. What's your funnel? To tell our story, to express the feelings we want to engender in ourselves, our employees and our customers. If they do not feel the same way, or are not charged by the visions, then they do not stay on. Cashiering, customer service and guiding can be taught and learned, but the employee needs to be committed to the vision and feelings we are promoting.
  6. After hiring people, how will you evaluate them? Depending on the position, we will see if they are a fit by evaluating their commitment to improve, to stay true to the vision of the company, and how they interact with the clients. If they are willing to do a little extra, just because they want to be part of the vision.
  7. How long after starting will you give people a formal review? Depending on how the employee appears to be working out. If the employee appears to be a fit, we give a review after 1 month. If it doesn’t appear to be working out, the review can be given after the first week, or 2 weeks.
  8. What's your approach for talking about the uncomfortable? By staying true to the vision for the company, to the feelings we want to promote in the workplace and to the clients. By being honest and transparent about expectations and the vision, accompanied with sensitivity and openness, I believe that discussing these matters can take place with minimal discomfort.
  9. Are you asking people to do work that's been done before, or to explore the edges of a new universe? I’m asking them to do work that’s been done before. That said, I would like them to contribute by bringing in ideas on how certain areas can be improved, in order to create a better experience for the customer.

Lesson #5: Naming
1. Create a name (and live with it)

Our initial thoughts for a company name was Heritage Bikes and Rentals. The “motto” of the town we will in is Heritage Perth. After listening to the videos and reading the information, my partner and I are interested in changing out name to something less “old and traditional” as this is NOT the energy or the feeling we want to have associated with our business. We have done all the exercises suggested, but are still undecided about a name, and feeling confused about this part of the business. It’s a work in progress. We hope to have something very soon.

Lesson #6 Partnerships
1. Delineate your approach to partners

Consider the following:

  1. Who else is helping you start this thing? Husband
  2. If they stopped working on the project in a month, would that be okay? No, he knows much more about bicycles, cycle tourism and has contacts in the industry.
  3. How much are you actually hoping they will contribute, today, tomorrow and year from now? I am hope that he will contact all the people needed for location, licensing, purchasing of bikes and equipment, transportation of bikes and organization of tours. In the future, I am hoping that he will continue to make the business contacts, look for big clients, promote ongoing business relationships with 2 associate companies, be in charge of bike repair, lead bike tours, organize tours, train guides, product development, and be the contact person for business side of the company.

Julie

Peter

Decisions

Retail Sales

Customer Service (large clients)

Decisions about retail store and customer service and staff will be made by Julie

Business Planning

Contact for location, licensing and community relations

Decisions about bike purchases, tools, and tours will be done by Pete

Customer Service

Purchasing of bikes and equipment

In all other aspects of the business, decisions will be made by both Pete and Julie.

Research and Purchasing stock for store front

Purchasing of tools

Finances

Tour organization

Tour guide

Contact with associative cycling companies

Advertising

Advertising and graphic design

Research

Looking for big clients

Manager- pay roll, scheduling, staff evaluations,

Bike repairs and maintenance

Tour Bookings

Lead bike tours

Brochure

Train bike guide

 

Train retail staff

Product development

 

 

 

 

 

 

 

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