Ballpark Batting NZ Limited Business Proposal
Introduction
We are very pleased to introduce Baseball BALL PARK BATTING to Australasia – the first countries outside the USA to offer this batting system to the general public.
Our golf driving range in Rotorua has been established since 1997 and since June this year we have available for the first time in the country a fully automated baseball batting system to complement our golf activities.
Our company, BallPark Batting NZ Limited has been appointed Australasian distributors for BALL PARK BATTING by the USA based manufacturer and developer of the system.
Baseball batting stations are very popular in the USA but are generally enclosed by wire cages when established as commercial operations. The obvious advantage of our system is the batter can see the full flight of each hit, with golf driving ranges being an ideal location to incorporate baseball batting.
Our aim is to sell the system or to operate under lease to selected driving ranges throughout Australasia.
Facts and Figures
We have noticed that our golf range turnover and income at Government Gardens Golf has been steadily dropping since peaking in 2001/02 in line with global trends in golf.
Our business philosophy to counter this trend has been to establish different income streams under the umbrella of our golf complex, hence developing a mini golf course in 2004, licensed bar and now baseball batting. This has helped to re establish our turnover by not being totally reliant on golf industry trends. Apart from establishment costs to develop these new income streams overhead running costs at ranges are minimal because rent, rates, power and staffing costs generally don’t increase.
We have found the baseball operation income is running at 28% of the total range income and we are finding some of our golf customers are trying the baseball and the new faces using the baseball are trying golf, with the extra numbers through the door boosting general over the counter sales. As an example a recent weekend’s turnover of food and drinks was 220% up on the average of the corresponding weekend over the last 5 years.
Market
Softball is a major sport in New Zealand with 16 provincial associations in the North Island and 10 in the South Island with 30,000 plus senior players. These figures do not include junior and social players. The softball season is over the summer with club competitions commencing in October. Baseball is established in the Auckland and Canterbury areas with 6000 plus serious players. There are no commercial practice facilities available for either softball or baseball.
Early indications in the off season show that softball players will use our facility on a regular basis – a potential market totally underestimated by us.
We have found that baseball batting appeals to the male 16 to 30 age group who generally arrive in groups of 2 to 4 and try to out bat each other and will often hit 2 to 4 buckets each. These guys are regular customers, using the facility 3 to 4 times a week.
The speed of the pitch can be adjusted to suit all levels of ability with slower speeds appealing to females and youngsters.
Advantages to Driving Ranges
A trend is developing in the USA with 10 to 15% of ranges incorporating baseball batting within their facility at present with research suggesting this figure will quadruple within 10 years. These batting stations are traditionally the cage type where the batter hits the ball into an enclosed cage area.
Baseball can be installed easily under the range shelter on the range deck and the activity dovetails nicely with golf. While driving ranges are space intensive batting cages are space and manpower efficient.
Ball picking and washing is a similar operation to golf but easier – balls don’t fly as far, don’t disappear into muddy soft areas and are quickly washed and dried ready for re- use.
Wear on balls is at a minimum with no mat replacement and the potential for theft is much less than with golf balls.
Extra staff are not required with few additional hours involved per week for the daily picking up, cleaning and storage operation. Counter sales staff sell the buckets of baseballs the same as golf.
The time taken to hit a bucket of baseballs is much less than a bucket of golf balls, approximately 5 minutes compared to 30 minutes for golf. At $8.00 per bucket each baseball machine can potentially earn $96.00 plus per hour.
We estimate that 33% of our total range income will come from two baseball machines, without affecting the existing golf range turnover, with the potential to be significantly higher in the summer.
Lease Proposal
As an alternative to outright purchase of the plant & equipment we are proposing a lease arrangement with selected outlets where our company provides Baseball Batting at our cost, completely installed* and ready for customer use.
Income is to be shared on a 50/50 basis between BallPark Batting NZ Limited and the selected outlet.
Each machine has a ball counter installed with ball numbers calculated on a weekly basis less a percentage for testing & trialling.
Fees are calculated and paid to the company on a weekly basis.
The initial lease period is for 36 months with a right of renewal for a further term.
A lease contract with terms and conditions will be entered into by both parties.
Any ball or disc replacement during the initial 12 month period is at the operators cost.
During the lease period any costs due to damage or wear and tear to the system through neglect or misuse by the operator or his staff are the responsibility of the operator.
Insurance of the plant and equipment during the lease period is the responsibility of the operator.
* Installation costs and electrical costs are extra depending on outlet requirements. Estimated costs for installation and electrical are $3500 - $ 4500 for 2 stations.
