Investor Presentation

Mosaic Mall, LLC. Investor Presentation

Presented By:

Penelope Daniels 2007 Panasci Business Plan Competition Entrepreneurial Spirit Award Recipient

Vision CNY’s First Multi-Tenant Beauty Enhancement Facility

What is Mosaic Mall?


Mosaic Mall is best described as a mall of




Mosaic Mall will lease fully equipped units to




Mosaic Mall has the objective of becoming the

beauty professionals. state licensed beauty professionals only existing multi-tenant location for beauty care in the Greater Syracuse area.

Salon Suite Industry • The “Suite” concept has revolutionized the Salon industry and has provided hundreds of salon professionals a greater opportunity for independence and success. • Suites are designed for professionals who desire the freedom of operating their own salon.

Salon Suite Industry • Hairdressing services have proven to be virtually recession proof • Consumers traditionally cut back on other discretionary expenses before decreasing their spending on personal grooming.

Syracuse Statistics

Total Sales 2002

NYS Census Bureau

$5,869,000

Total Number of Salons

31

Total Payroll

$2,353,000

Avg. 5 Employees/location Sales/location

$189,000

Salary per employee

$15,585

Benefits for Tenants


Operate own exclusive salon – be their own boss




Have private lockable entrance




Provide a clean, upscale and professional environment to service clients




Create own personal atmosphere




Security controlled entrance




Laundry facility on-site




On-site Beauty Supply Store

Benefits for Clients


Creates a ‘One-Stop-Shop’ facility for the entire family




One-on-one service, providing more intimate and private servicing




Scheduling will provide a shorter waiting period




Comfortable waiting area




Quiet environment

Survey 20 Replies Salon Owners

5

Booth Renters

15

Hair Stylists

10

Manicurists

3

Barbers

2

Suite Concept

Yes -16 No – 2 Undecided – 2

Survey 20 Replies Nationality Caucasian

13

AfricanAmerican

7

Survey Comments Great Idea! Depends on location, but sounds exciting. Would need more information before deciding Sounds great… great…good luck

Marketing/Advertising Tenants • Direct mail • Newspaper advertisements • An incentive program will be initiated with the area cosmetology schools.

We will offer on-site entrepreneur training as well as internships to recent graduates.

Customers • Website • Email marketing • Direct Mail • Yellow Page Advertising • Radio/TV Advertising • Customer incentive system – friend and family referral discounts • Gift certificates/Coupons to charity organizations

Target Market Target Market Analysis Hair Stylist 12% 4%

Manicurist

6%

Aesthetician

7% 71%

Massage Therapist Barbers

Start Up Analysis


The average cost of equipment to furnish a unit is approximately $1,800. It is estimated that we will have 50 units for rent; thus equipment cost is $90,000




Other expenses such as incorporation, legal and advertising come to $2,400




Based on a $2,000,000 facility purchase, the first month's mortgage and land lease totals $8,000




Office and common areas equipment and furnishings total $6,000




Total start-up requirements including cash on-hand are estimated at $1,006,365

Sales Per Year 5-Year Sales Forecast

160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 2007 Large Salon Suites

2008 Small Salon Suites

2009

2010 Manicurist

2011 Aestheticians

Massage Therapist

First year net worth is estimated at $224,914 growing to $948,874 in Year 5.

Break-Even Analysis BreakBreak-Even Analysis Monthly Revenue Break-even

$32,806

Assumptions: Variable Cost Per Sale Estimated Monthly Fixed Cost

$2,864 $19,514

Milestones Obtain Financing Secure Site Obtain Licenses/Permits Complete Architectural Design Secure contractor Finalize Construction Complete Ad Campaign Interview Vendors Salon Equipment Set Up Secure 30 Vendors Opening Day

Mo. 12

Mo. 11

Mo. 10

Mo. 9

Mo. 8

Mo. 7

Mo. 6

Mo. 5

Mo. 4

Mo. 3

Mo. 2

Mo. 1

How will money be made?


The sales strategy for First Quarter 1 is to have signed leases for 30 units. Each subsequent quarter increase signed leases by five.




Triple Net Leasing: A lease in which the lessee pays rent to the lessor, as well as all taxes, insurance, and maintenance expenses that arise from the use of the property.




Anticipated lease renewals for subsequent years thus resulting in 100% occupancy. Sales Forecast Year 1

Year 2

Year 3

Year 4

Year 5

Total Sales

$452,400

$762,000

$762,000

$762,000

$762,000

Direct Cost of Sales

$183,300

$316,160

$318,224

$318,224

$318,224

Company Growth • The nature of Mosaic Mall's business is to carry no inventory; salon unit leases are paid current; thus there are no accounts receivables; and limited long-term assets in equipment are depreciated over five years. • Future plans include acquiring a 2nd location if demand requires:

Operations Reception • Each client is greeted by a trained administrator • Tenant notified of appointment arrival • Scheduled clients directed to their tenant • Walk-in clients are referred to tenants reserved for servicing that day

Duplication Possibility The concept of this service can be easily duplicated. However, by creating a climate of caring for our customers, by maintaining a high level of customer service to preserve a ''Family First" atmosphere; Mosaic Mall will maintain a loyal base of customers as well as tenants.

Competitors • Mosaic Mall's competitive edge is that we are the first enterprise of this kind in Central NY. All other salons are owned and operated by a few individuals that either are sole proprietors or pay employees 50% to 60% commission.

• The advantage of Mosaic Mall is the privacy of secure, individual leased unit mini-salon versus 'booth' rental.

Profit and Loss

Year 1

Year 2

Year 3

Year 4

Year 5

Gross Margin

$269,100

$445,840

$443,776

$443,776

$443,776

Net Profit

$224,914

$189,887

$183,174

$178,109

$172,791

Balance Sheet Year 1

Year 2

Year 3

Year 4

Year 5

Total Assets $340,790 $530,677 $713,851

$891,960 $1,064,750

Total Liabilities

$115,876 $115,876 $115,876

$115,876

$115,876

Net Worth

$224,914 $414,800 $597,974

$776,083

$948,874

Location Widewaters Park Features: • Central New York’s largest office park • Adjacent to regional mall • Regional bus service • On-site maintenance • Health club on site • Located at the intersection of Interstate 690 (East/West) and Interstate 481 (North/South)

Location

PARCEL SIZE:

6 ± Acres

MARKET AREA

BUILDING CAPABILITIES:

4,500 ±SF Out Parcel 45,000 – 60,000 ±SF Main Building

Population

ZONED:

Commercial

AVG DAILY TRAFFIC COUNTS: 23,000

5 MILE

10 MILE

59,460

163,740

356,255

Average HH Income

$66,467

$64,373

$64,755

Per Capita Income

$22,209

$26,501

$24,772

36,286

103,762

171,814

Employees

3 MILE

Widewaters Park Benefits • Provide services to business, shopping and residential community not currently in existence • Become an addition to current shopping and office environment

Management Team Penelope Daniels • Budget Analyst at Syracuse University • Budget management of approximately $10 million in allocations and expenses for the division with over 50 accounts • Responsible for managing human resource functions, recruitment, and hires as well as records management, and guides and directs staff in processing expenses for programming • 20 years administration experience • 2007 Panasci Business Plan Competition Entrepreneurial Spirit Award Recipient

Sharron Pearson • Public Relations/Marketing Manager • 20 years experience in advertising, publishing, and fund development • Assumes all advertising, promotions, marketing, and public relations responsibilities • Coordinates market research, marketing strategy, advertising, promotion, product development, and public relations activities • Evaluate advertising and promotion programs for compatibility with public relations efforts. Observes social, economic, and political trends

Mosaic Mall, LLC. Organization Structure Duties: Penelope Daniels

CEO, CFO




Oversee daily operations




Perform crucial budget, payroll, and general administrative duties, exercising independent judgment and tact, and maintaining confidentiality




Property management

Mosaic Mall, LLC. Organization Structure Penelope Daniels

CEO, CFO Sharron Pearson Marketing Manager PR Manager

Duties:


Conceive plans and implement innovative marketing strategies.




Consult on and execute special events.




Produce and distribute marketing efforts, i.e. newsletters, staff news, brochures, event flyers, and other publications




Establish measurable public relations strategies

Mosaic Mall, LLC. Organization Structure Penelope Daniels

CEO, CFO

Sharron Pearson Marketing Manager PR Manager

TBA General Manager

TBA Administrator

TBA Lease Manager

TBA Event Planner

Establish Year 2

Exit Strategy
The 1031 Exchange

 Property held for productive use in a trade or business or for

investment, and it allows for the deferral of capital gain tax if such property is exchanged solely for property of “like-kind.”


The TenancyTenancy-InIn-Common Investment

 Allows individuals to own a fractional interest in high grade commercial

properties, such as a shopping center or office building, and thereby opens the door to higher-valued and better-located properties than an individual could afford independently  The investor can then enjoy a triple net leased, professionally managed property and a monthly cash flow without any of the hassles of property management.


An Installment Sale

 AKA seller carry back note or seller financing, works best for real

estate investors who want to sell their real estate but don’t need a lump sum payment  Buyers pay the seller monthly income at a rate and term to be decided by the seller  The tax benefit of installment reporting is that because taxes are not due on a lump sum at the time of sale, interest is earned on the deferred dollars over the years

The driving factor in choosing one type of arrangement over the other will undoubtedly be cost. Owners of traditional salons face many challenges when starting a new business. Purchasing equipment and finding a location in a high traffic area with reasonable rent is often difficult.

The Solution is Mosaic Mall