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Earned revenue for the Riverton Business Accelerator is largely dependent on receiving a steady stream of leads for the courses, converting those leads, and encouraging the clients to go on to become annual members and take part in the business expo. All of these key marketing metrics are tracked in a CRM system, while the resulting sales and required expenses to achieve these sales are tracked in nonprofit accounting software. The Communications Associate is responsible for the former and the Business Manager for the latter.

12.1 Sales Forecast

Earned revenue will grow to form an important part of the overall budget of the Riverton Business Accelerator, even though, for each client, it primarily serves the purpose of a psychological motivator to insure that the client takes full advantage of the organization's programs. Business training course fees come in three times per year when the courses begin. Annual fees are generally paid at the conclusion of each course, when those graduates and graduates from the years prior are asked to start or renew a membership for post-graduate services. It is expected that not all graduating students will become members, but at least 75% will. Expos occur in September and April.

Expenses for the training course are 60% of the $100 training fee, or $60 per client. This includes the $50 refund to the client after completion of the course. As described in the Price Rationale earlier, pricing the course at $100 and offering the $50 refund is important to the Riverton Business Accelerator to know that the clients have a financial as well as time investment, and also have an incentive to see the class through to the end. The remaining 10% covers the costs involved for materials and for presenting the class.

Sales Forecast

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Sales Forecast
Year 1 Year 2 Year 3
Unit Sales
Business Training Course Fees 810 1,000 1,200
Annual Member Fees 870 1,500 2,300
Expo Space Rental 110 140 170
Total Unit Sales 1,790 2,640 3,670
Unit Prices Year 1 Year 2 Year 3
Business Training Course Fees $100.00 $100.00 $100.00
Annual Member Fees $150.00 $150.00 $150.00
Expo Space Rental $100.00 $100.00 $100.00
Sales
Business Training Course Fees $81,000 $100,000 $120,000
Annual Member Fees $130,500 $225,000 $345,000
Expo Space Rental $11,000 $14,000 $17,000
Total Sales $222,500 $339,000 $482,000
Direct Unit Costs Year 1 Year 2 Year 3
Business Training Course Fees $60.00 $60.00 $60.00
Annual Member Fees $45.00 $45.00 $45.00
Expo Space Rental $70.00 $70.00 $70.00
Direct Cost of Sales
Business Training Course Fees $48,600 $60,000 $72,000
Annual Member Fees $39,150 $67,500 $103,500
Expo Space Rental $7,700 $9,800 $11,900
Subtotal Direct Cost of Sales $95,450 $137,300 $187,400

12.2 Marketing Expense Budget

The marketing expense budget is covered by the earned revenue of Riverton Business Accelerator. This budget focuses on marketing to clients and press. Marketing to donors is accounted for in the development budget. The next three years will see rises in the budget to meet the demands of growing programs each year. Advertising and direct mailings are primarily done in the month before each course begins. Other costs are year round.

Marketing Expense Budget

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Marketing Expense Budget
Year 1 Year 2 Year 3
PR agent $3,000 $4,000 $5,000
Advertising $3,900 $4,500 $5,000
Reviews and surveys $600 $800 $1,000
Collateral $2,400 $0 $0
Website $1,200 $1,500 $2,000
Direct mailings $3,900 $5,000 $6,000
------------ ------------ ------------
Total Sales and Marketing Expenses $15,000 $15,800 $19,000
Percent of Sales 6.74% 4.66% 3.94%

12.3 Key Marketing Metrics

Leads include all of those who inquire about the training course, including those who simply call or email, as well as those who come to the session and those who enroll. It is expected that about one in three leads will convert in the first full year, and this conversion rate will improve a bit in the years to come as results of the courses become available. Average $ per customer per year is based on the fact that not all graduates become members after graduation and only some of those members take part in the business expo. Approximately 20% of leads are expected to come from referrals of other organizations and past clients.

PR mentions will increase steadily with the hiring of a PR agent to pursue stories in the media. Testimonials include all video testimonials taken upon the completion of each set of training courses. Of these, a much smaller number will be used on the website, or pieced together into longer videos for marketing or fundraising purposes. Newsletter sign-ups include most of those who start the training course, and other community members, less any who cancel their newsletter subscription.

The Communications Associate is responsible for tracking these numbers through the CRM database and prepares weekly reports of the numbers for consideration by the Director of Communications.

Key Marketing Metrics

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Key Marketing Metrics
Year 1 Year 2 Year 3
Revenue $222,500 $339,000 $482,000
Leads 2,700 3,333 4,000
Leads Converted 30.00% 35.00% 40.00%
Avg. Transactions/Customer 1.30 1.35 1.40
Avg. $/Customer $162 $173 $184
Referrals 540 667 800
PR Mentions 52 84 100
Testimonials 900 900 1,000
Newsletter Sign-ups (net) 2,712 3,500 4,200

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