Customer count projection review support request...

[KennyMike]

Please take a look at my customer count projection for my business plan and let me know if you feel I am being realistic...

Explanation of figures used for customer count and sales calculations.

Sitting on a "hard corner" bordered on one side by a six lane state highway and on the other by a four lane boulevard, the 24 hour, one direction (right turn in) traffic measures are 54,600 (08/06) and 31,800 (05/06) respectively, according to Public Works. These are both burb commute routes and the higher percentage of this count is morning traffic.

To establish a first year conservative number of customers captured, I will use the following formula to arrive at the projected daily customer count.

 The total right turn access number in a 24 hour period equals 86,400 vehicles.
 No numbers from the opposite direction flow (50,000+) will be used in the calculation.
 By reducing the 24 hour flow number by 25% to better represent the number of vehicles going by during business hours the count equals 64800.
 The industry goal of a 1% capture rate equals 648 vehicles.
 For a more realistic startup number the 648 capture will be a first year goal with a 10% quarterly increase, so the first quarter is 60% of 648, meaning that first year quarterly capture numbers used for projections are as follows:


QUARTER /VEHICLES CAPTURED
1st /389
2nd /454
3rd /518
4th /583
First half of following year /648

In the years to follow the goal is to reach a 2% growth rate each 6 months for the next 3 years.

 

[John P]

I never much saw any relevance in traffic counts.
That being said....
What's relevant are the actual percentage of coffee drinkers who stop in your area. I would find the traffic count for the relevant streets for a 'competitor' in your area. I would then watch them from opening for about an hour and a half on Monday, one midweek day, and Saturday and do a customer count of who goes in the store. Even better to be a customer and count who actually purchases--because two people could mean 1 drink, or it could mean 5 drinks. I would scope out middle of the day and evening under the same scenario. What's important is capture rate for your particular area resulting in coffee sales. Gross generalizations, even altering the percentages, usually lead to---well---- gross generalizations. To best understand your local clientele, its best to study your local clientele

 

[Jackson]

John P is very wise! You did your homework on site analysis, now study your competitors. If you are planning a drive-thru, you may be surprised as to what percent of traffic actually spends money at a coffee drive-thru. If you are a destination coffee house, the traffic counts will not matter as much.
Good luck with your business plan, you have some homework to do!

 

[John P]

a legend in my own mind