2. TrakFit
Team Members: Kyle Lake, Eddie Cook, and Cooper Oexle
Mantra: We Love Progress.
Our Vision: For the average TrakFit user we want to strive to provide excellent service as well
as an incentive for a personal trainer to use this service. For us, our customer’s progress is the
most important aspect of our business. Today, personal trainers and long log books are the ways
of tracking your individual growth. TrakFit’s services will provide the fundamental technology
to provide an easier way to track your personal gains and achieve your own goals.
Table of Contents:
I: Executive Summary
II: Company Summary
III: Products and Service Description
IV: Market Analysis Summary
V: Marketing Plan Summary
VI: Organization Summary
VII: Financial Plan
3. Executive Summary:
We found that there is a niche market within this industry that has not been attempted by
any of our competition. Most of our competitors allow fitness instruction and guidance through
workouts and examples of different ways to build muscle or lose weight. TrakFit will do all that
and more, allowing the personal trainer to be in the picture with the relationship between trainer
and client intact we believe that TrakFit will become the superior app for weight training and
health fitness.
In order for us to be successful in this endeavor we need to effectively market our
product. We will be actively traveling to gyms and trainers all over the state to pitch this
product. With the right marketing techniques we will be able to show how feasible this app can
be. This app has advantages that will help personal trainers and small workout facilities. It will
provide them with a cheaper and a more effective way to track the progress of their clients. Our
team is dedicated to the sales of this product, as well as maintaining the advancement of the app
and improving it for our customers.
In the first year of being in business we want to accomplish our goal of reaching 24
locations running TrakFit through their personal trainers. We believe that is both a feasible and
realistic amount with the amount of time it will take and the three of us launching the venture.
For long term objectives we want to be able to get 12 additional locations each year after the
initial launch. We also want to get to the point to where we will be able to advertise and hire two
or even three IT experts, along with more help with sales to local gyms we would like to hire
more sales representatives and provide more clients in the future.
4. According to our cash budget we have a budget of $189,000 our first year and $164,000
our second year of operations. We do not have any of our own money to invest in the company
so we need investors to loan us money in order for us to begin this business. We plan on having
sales revenue of $180,000 our first year and $198,000 our second year. We would like an
investment total of $200,000 from investors. We feel this amount of money will set us off on the
right foot and we will be able to pay back our investors with interest within the first couple years
of our business.
Company Summary:
Mission Statement: To enhance the relationship between fitness trainers and their clients
with superior technology. Our app will keep track of client’s workouts in a simple and organized
manner to optimize their progress.
Company ownership: General Partnership. All business activities are split evenly in three
portions, a third for each owner. We chose general partnership because of a few reasons. The
cost of setting up and maintain our partnership will be relatively low so that was a big factor in
our decision. Also, each owner will pay taxes for their individual income so we are avoiding
double taxation by choosing a partnership. We want to be the only members of the business
making management decisions so again, a general partnership is the right decision for our
business. Kyle will be the CEO and co-founder. Eddie will be the COO and a co-founder.
Cooper will be CFO and a co-founder.
Company Locations and Facilities: Since this is an app we will not directly sell the right
to use the app to user in a face-to-face manner. We will allow users to download the app through
the app store. We will only need a small office that runs filled with servers and technicians to
5. make sure the app is run smoothly. Our office will be simple enough to run an app so we plan on
purchasing an office roughly two floor 6,000 sq. ft.
Current company status: We do not have a prototype. The APP Company will develop
our app. This app will be produced by The APP Company in their facilities. We plan on
consulting with health and fitness companies that would be interested in advertising on this app
such as Men’s health magazine, Women’s health magazine, Gold Standard, EAS, and so on. Our
intellectual property is that we will be the only provider of this standard fitness tracking apps that
allows fitness trainers and their clients to work better together. We believe TrakFit will truly
revolutionize the relationship between the trainer and client. Never before has a trainer been able
to individually track their client’s progress like TrakFit will.
We will need app developers. The three co-owners of this company do not have the
technical ability to create this app so we will hire a company to do so for us. We will also need a
team to make sure the app does not crash and runs smoothly so our customers can be satisfied.
We need a web-developer to create the website for the app so progress can be accessible on our
website. We need a salesperson to go in the area and locate potential successful independent
gyms. Our partners will be independent gym owners that we will sell the product and that will
allow the members of the gym to use our app. We plan on approaching independent gyms
beginning in the Cleveland area and explaining how our app will create value for their
customers. Further analysis on how we approach our customers will be in the marketing plan
summary.
6. Product and Service Description:
TrakFit is an online application that we are selling to fitness clubs, workout venues, and
personal trainers. Since we are not selling this application to nationwide workout facilities such
as LA Fitness and Planet Fitness, we are focused on selling to local and smaller organizations.
Our app helps the smaller clubs and facilities keep track of each member’s progress when they
work out, from the time they start their membership to eventually reaching their personal goals.
We sell this app to personal trainers because the trainers use it to record their client’s
progress with step by step technologically. When the client first comes in and meets with their
trainer, the trainer has the person create a TrakFit account, record their current physical
condition, and write down their three main goals. After recording the client’s height, weight,
body mass index (BMI), hydration level, and nutrition level, the trainer plugs in the data into the
TrakFit app. The client’s account is available for that person to access and review by
downloading the app.
Once their account is finished, the client can start their fitness training. Before every
workout the trainer and client check the schedule calendar that is posted on the TrakFit app and
see what workouts need to be done for that day. The app is designed to allow the trainers to add
or delete workouts that are necessary for the positive progression of the client. Another feature of
TrakFit is that it is a universal app, meaning that if a person decides to switch gyms and both
gyms include a TrakFit package that the information and progress made at the previous gym can
be transferred to the next gym with ease. For example, if a customer works out at a gym in
Cleveland for two years and then moves to Canton their progress and data will travel with them,
much like medical records.
7. Our app is extremely easy to use. For example, if the workout for Tuesday is focused on
the back, chest, and abdomen, the trainer would go over the different workouts. During the
workout the client would complete a circuit of push-ups, bench press, dumb bell rows and leg
swings. After the client finishes each set, the trainer records however many reps the client
completed and how much weight was used. If the client did 4 sets of bench press, and each set
was for 8 reps, the trainer would check off how many they completed. If the client bench
pressed 135 lbs. the trainer would then record that into the app.
Throughout the process, the client is encouraged to review their progress with their
trainer. The trainer goes over the increases and decreases in progression from workout to
workout to help the client stay motivated. This a process that compares to watching film of a
football or basketball practice or game to help a team learn from their mistakes and see what they
need to improve upon. Different graphs comparing the client’s progress, such as their increase in
bench press or back squat, are used quite often to show the client what they need to improve on
in order to reach their goals.
This is a desirable application because it provides a highly technological approach to
fitness. It gives both the trainer and client accurate data to work from in order to reach their
goals. Since we are only focused on local and smaller facilities, trainers of those companies can
attract more clients to want to use the advanced technology in their personal workouts. This will
allow them to market a personal or even family oriented approach to technology and fitness.
According to CBS News in May of 2013, 80% of American adults do not get the recommended
amount of exercise per week. This is a shocking number, but our app helps people stay
motivated because daily updates about workouts, nutrition, and ways to stay healthy are sent to
the person either directly from the trainer or from the databases of the app.
8. In today’s technological world, everything is done over a smartphone, tablet, or some
form of technology. With all of this technology there are millions of apps. Some of the different
fitness applications include GymPact, FitnessBuilder, DailyBurn, and Pumping Weight. Each of
these apps, including TrakFit, are quite similar, but indeed do have many differences.
All of the apps provide the person using the app to record data about their progress in the
weight room or on the treadmill. Each app gives different graphs and ways of showing how well
the person is progressing, or even show them how they are regressing. Most of these apps also
give the person tips on what to eat before and after a meal to gain maximum results and
recovery. The apps allow each person to share their results with their friends and even some
such as FitnessBuilder have the option to ask questions to fitness experts.
Although TrakFit has many competitors, our app is the only one directly marketed to
fitness centers and personal or physical trainers. Our app is the best for businesses to invest in
because it provides the clients with a feeling of reliability and certainty to what workouts they
are doing and if they are truly getting lasting results. Anyone can download a fitness app and try
to do it on their own, but with TrakFit the trainer is right there helping and motivating them
along the way. The feeling of reliability is there because the client can trust their trainer’s
decisions, as well as the decisions and suggestions on the app.
We do not need features such as asking questions to fitness experts or sections about
healthy eating and nutritional facts because the workouts are run by fitness professionals
themselves. The client has the opportunity to ask their trainer as many questions as they may
desire.
9. In order to gain customers, we will be traveling to each and every small gym or workout
facility in the area. Our knowledge of the app and the competition we are up against will be used
in our pitch to the business owners and trainers. We will stress on the fact that this a better app
than those already produced, and how we differentiate ourselves from the competition.
The way this app will be produced is by having a technology team working on the
application everyday improving the overall wellness of the app, updating it to make it faster and
more technologically advanced, and making it easier to use for anyone who has it.
Market Analysis:
For TrakFit, our industry is an emerging industry, apps and systems that are used for
personalizing workouts and also tracking your progress are coming out by the dozens. Apps such
as, Cody, Gym Hero, Pumping Weight, Fitness Builder, and Fooducate are all apps that are
popular among common gym-goers. However, our app/system will be able to tap into a niche
market that has a large target market. For TrakFit, selling our services to independent workout
centers will allow us to have a connection directly with our customer.
10. Our Main Competitors:
TrakFit vs. Other Popular Apps
Name Cody Gym Hero Pumping
Weight
Fitness
Builder
Fooducate
Personalization Advantage Even Disadvantage Advantage Disadvantage
Social Aspect Advantage Even Disadvantage Disadvantage Disadvantage
Nutrition
Information
Disadvantage Even Even Even Advantage
Price Even Even Even Disadvantage Disadvantage
Navigation Even Advantage Disadvantage Advantage Advantage
Features Disadvantage Even Disadvantage Even Disadvantage
For TrakFit to be a successful app in this industry our product is going to have to
compete with these examples of apps in this industry as of right now. Apps such as Gym Hero
has a very organized way of presenting data that keeps journals of workouts. Other apps such as
Pumping Weight is more for the average lifter, it has a calendar view of workouts, graphs, and
allows you to share workouts with friends. Much like Pumping Weight, Cody, also a social app,
is made for showing friends your progress/workouts, showing pictures, locations, notes, and it
also works with Facebook, Twitter, and Instagram. Apps like Fitness Builder and Fooducate that
require a monthly subscription once used after a free trial are used for more of an in-depth
diagnostics of your daily workout routine and eating habits that may help you reach your goals.
For our app to be successful it is going to have to combine many different features of these apps
such as: Fitness and strength, tracking and analysis, food and nutrition, relaxation and
11. meditation, overall wellness, running and cardio, intervals and circuit training, yoga and palates,
weight management, and music playlists for workouts.
We want to segment our market away from selling to large companies that have gyms
nationwide such as Planet Fitness, LA Fitness, and The YMCA. These large companies already
have some form of tracking your progress, but TrakFit is far different than any of these systems,
TrakFit is far more personal and will ease the overflow of work for personal trainers at these
independent gyms. TrakFit will also allow personal trainers at these independent facilities to be
able to have more customers with an easier way of doing business with them.
A broad segment of the market are runners, since our app is targeted more towards the
learning of weight training methods or even weight loss methods our product is not for the
average runner. In these independent gyms most customers are common men and women
looking to get their workout in for the day. Although, with TrakFit it will be easier and faster to
see results by finding a personalized workout just for you with the trainers available at TrakFit
locations.
Our target market is the average gym-goer who always thought that personal trainers
wouldn’t work, that always had such a busy schedule that they could not afford to reschedule
personal trainer workouts. Now, with TrakFit, your personal trainer will be able to update your
workout just from seeing your progress through the app itself. The future for this market is
promising, it is projected that the market for fitness and wellness apps is predicted to grow about
23.78% annually (Technavio).
Technology in the fitness world is trending, Nike recently came out with the fuel band
track the amount of calories both gained and lost, it sets goals for your next workout, and it also
12. projects your progress. Heart-rate monitors, Nike+, MapMyRun, and other fitness apps that are
trending have shown great success in the industry. We believe that the untapped part of this
market will allow us to fit in just as well and have success as well.
It is true that individual local gyms are the ones that are surpassing nationwide gyms as
far as customer satisfaction and customers keeping their memberships. We believe that it is
because customers could be offered a membership with a high-end personal trainer at a gym like
Planet Fitness for a much higher membership fee. However, many customers go for the smaller
business supporting their community and getting the minimal membership. With TrakFit these
customers will be able to access personal trainers for a lower fee due to our services. With a
majority of people in our target market leaning more towards local gym memberships our
product TrakFit will take advantage of this opportunity.
Marketing Plan Summary:
At first, TrakFit is going to start small, reaching out to local gyms in the Cleveland area
ourselves. The three original co-founders will have to find initial revenue in order to look into
hiring any additional help on expanding the business. We will connect with our customers by
phone and also in person, setting up meetings in different independent gyms in many different
areas, starting small and then expanding as the business grows. By having an additional sales
representative on our venture team we will be able to reach out to these gyms, pitch the TrakFit
idea, and find out if they would be interested in purchasing our even trying out a trial package of
the TrakFit system. Also, by having a lead salesperson on our team the three co-founders can
focus on other aspects of the business to improve the company.
13. With all of the apps out there with similar features to track your progress throughout your
workouts, TrakFit will have to have features that outpace the competition and attract more
customers. The main reason that we believe that people will buy our product rather than the
competitions is because of the personal relationship you are still able to have with your trainer.
Just like going to any other gym’s personal trainers, TrakFit will only enhance that relationship
even further. For example, if one of our personal trainers is using the app and they have multiple
clients to take care of throughout the day, they not only have an easier way of doing business but
also the option of still have one-on-one meetings and personal workouts if needed. Many gym-
goers like the fact that they have a motivator to guide them through their workouts, but others
may feel that they would like a personal trainer’s input while they are still able to work out on
their own time. TrakFit is ideally made for the people with the busy schedules and do not have
time to meet with a trainer all the time. We believe that TrakFit can offer a more efficient way of
doing business between the personal trainer and client.
We will sell the right for independent gyms to use TrakFit and it will be up to them for
how much they want to charge or even charge their customers to use it. In the beginning of the
business we will sell the rights for $3,000 to the gym and then charge the gym as well for how
many customers are using the app. We will charge the gym $5 per customer per month that uses
TrakFit. We feel in order for our company to be profitable we must charge this price per location
that invests in TrakFit. The $3,000 is a one-time investment and the gym will not have to pay any
more money to use the rights to our app. Also, we feel $5 per customer per month that uses
TrakFit is a reasonable price. Since customers will pay to belong to the gym, we feel that the $5
will only be a fraction of their membership to the gym. This app adds value for potential
customers will attract more people to the gym which will then turn into greater revenue for the
14. gym; so $5 is a reasonable price to charge. For example, if a gym buys the right to the app and
has 100 customers that use TrakFit for a year we will charge $3,000 for the right and we will
receive $500 per month and $6,000 in the first year. The total amount of money we will receive
will be $9,000 for the first year. After the first year (assuming no members quit and no new
members) we would receive $6,000 per year. All prices are subject to change depending on how
the business grows.
Our business will have a few expenses in order to operate every day. We need to develop
the app which will cost $25,000 to do so. We will need an office space and will need servers to
help run the app. We also plan on purchasing an office during the first year that costs roughly
$100,000 and pay it off over 5 years with an annual payment of around $20,000 a year. The
office will have servers that are estimated at $20,000 and will be paid off in 5 years as well with
payments of $4,000 a year. We estimate insurance will be roughly $10,000 a year as well. We
figure there will be no/minimal variable costs because there are no costs that reflect on how
much volume we sell. With all of these fixed expenses we feel our prices are fair in order for us
to make profit.
We currently do not plan on having any marketing or advertising arrangements in the
beginning of the business in regards to promotions. We are considering many factors like
advertising in health and fitness magazines like Men’s Fitness, Women’s Fitness, Muscle &
Fitness, etc. We also will consider advertising with the gyms that purchase TrakFit. If a gym that
has TrakFit also has a billboard in the parking lot they could put an ad up letting people know
that they carry TrakFit. Since this app can be accessible online, we may put promotions online
and ads on the internet. If an independent gym has a few locations in the area, we are considering
offering package deals for all of the locations for a lower one-time fee.
15. The product will be available on the IOS software for the iPhone and other apple
products as well as the android phones. Once a sale to a gym is complete we will have our
salesperson let our IT team right away about our new client. From there the IT team will put the
gym’s information into our system and set them up on the app. Once the app is setup and
complete, members of the gym will be able to download and sign up on TrakFit. There will be a
website available for TrackFit users to check their data on their profile on their computer. The
app will be free for anyone to download on the app store but will only have value for TrackFit
customers. Once members download the app and create their account, they will have the same
username and password to access their progress and other information on a computer. We will
get paid initially by gyms with a $3,000 one-time investment. We will charge the gym then $5
per customer per month that they use TrakFit.
We will know our marketing strategy is successful when we hit our yearly sales. For our
first year of operation, our goal is to sell our app to 24 independent gym locations. After the first
year, our goal is to sell the app to 12 new gyms a year. In order for us to consider ourselves
successful we must hit each year’s target of new clients and also do not lose any clients. When
we initiate our marketing and advertising we plan on asking feedback from interested, potential
clients and what they think of TrakFit.
Organization Summary: Since TrakFit is going to be a convenient way of using technology to
replace the classic tedious way of recording results from workouts and exercises it is going to
need to be easy to use as well. One of the most important aspects of our system is going to be the
design and navigation of the app, for that we are going to need app designers and programmers.
Kyle Lake will be able to develop a basic website model for how TrakFit should look, but once
16. TrakFit is being sold to individual gyms and personal trainers an app/web designer may need to
be hired to track and update the systems.
Also, we will need to hire to get our venture up and running, we will need to hire
personnel such as a salesperson to talk to gyms in different areas, and also two IT employees to
handle any issues or updates needed by the app. The salesperson we will hire will travel to
individual locations in a certain area that show that these independent gyms are having
increasing returns on their customer memberships. Once visiting and pitching the idea/sale of
TrakFit the salesperson will make the call in to the IT personnel to set-up the independent gym
with the TrakFit app.
We expect to pay our employees a general salary, once the idea gets rolling we may need
to hire more sales representatives to get the idea out there and have the benefit for our customers
to transfer their information from gym to gym. The annual salary we expect to pay our sales
representatives will be about $50,000 per year. Next would be the salary for our IT experts that
would handle the up-keep of the app, each would need to be able take on the challenge of
making sure that gym-goers information is kept safe in each profile created on the app, that it is
accurate, up-to-date, and running smoothly. Each of our individual IT experts would make an
annual salary of about $40,000.
The key organizers of our venture will mostly be the app designers and then also the first
three co-founders that will provide opinions on how the app should run and what features it has
or may need in the future. Each co-founder having a background in a major part of business:
Kyle Lake – Marketing
Cooper Oexle –Accounting
Eddie Cook – Management
17. Financial Plan:
Cash Budget Year 1 Year 2
Expenses $ 189,000.00 $ 164,000.00
Projected Profit and Loss Year 1 Year 2
Revenue: Sales $ 180,000 $ 198,000
Cost of Goods Sold $ - $ -
Gross Profit $ 180,000 $ 198,000
Gross Profit Margin 100% 100%
Expenses
Office Loan $ (20,000) $ (20,000)
Insurance Expense $ (10,000) $ (10,000)
Salesperson Salary $ (50,000) $ (50,000)
IT/Computer persons Salaries $ (80,000) $ (80,000)
App Creation Expense $ (25,000) $ -
Servers Loan $ (4,000) $ (4,000)
Total Expenses $ (189,000) $ (164,000)
Net Profit $ (9,000) $ 34,000
18. Break Even Analysis:
Contribution Margin Ratio $189,000 / $7,500 = 25.2
Conclusion, we need to sell this app to 26 gym locations to breakeven in the first year.
Target Profit is $100,000 for first year $189,000 + 100,000 / $7,500 = 38.53
Conclusion, we need to sell this app to 39 gym locations to reach our target profit for the first
year.
Projected Balance Sheet Year 1
Assets
Current Assets
Cash $ 189,000.00
Prepaid Insurance $ 10,000.00
Long Term Assets
Servers $ 20,000.00
Office $ 100,000.00
Total Assets $ 319,000.00
Liabilities
Current Liabilities
Salaries Payable $ 130,000.00
Long Term Liabilities
Office Loan Payable $ 100,000.00
Server Loan Payable $ 20,000.00
Total Liabilities $ 250,000.00
Shareholder's Equity
Retained Earnings $ 69,000.00
Total Shareholder's Equity $ 69,000.00
Total Liabilities and Shareholder's Equity $ 319,000.00
