The franchise location, which last year was opened and is producing approximately $62,000 per year, was purchased for $10,000 and a note for $60,000. The note will be serviced out of the store's existing revenue stream. Paradise Tan will continue the growth of the store which this year had 422 new clients which is far above the industry average of 100 new clients per year. The store is in a middle market area with potential store sales of $150,000 plus. Breakeven on the store is $28,000 per quarter and is expected to be met in first quarter fiscal year 2004. With the addition of the Magic Tan sunless tanning mister, the store is expected to reach $35-$40,000 per quarter by quarter three in fiscal 2004.
Ron Schaefer, president of Paradise Tan, said, "This store is in an opportune growth area and has the demographic character which Paradise Tan seeks. The store's phenomenal growth in 2003 is a testament to this. The addition of the Paradise Tan Franchise marketing model and the Magic Tan system will be a huge boost to the growth of the store."
Paradise Tan's strategy calls for the maximization of markets based on geographic and marketing position. Through the maximization of marketing efforts by marketing several stores in one geographic region at once, Paradise Tan lowers its overhead and thereby increases profitability. Paradise Tan will consolidate individual geographic areas until that area has reached optimization. The geographic plan calls for placing stores in such a way as to have access to all of the retail market in the most accessible areas.
Ten percent of Americans spend on average $300 per year to tan indoors. This equates to a total US market for tanning of over $9 billion per year, and does not include the $3 billion tanning products market. Enhancements in technology and consumer acceptance are fueling the industry's growth.
About Paradise Tan Inc.
Founded in 1994, Paradise Tan Inc. (Pink Sheets: PTNK) is poised to become the dominant player in the indoor tanning market in North America. Paradise Tan currently operates 16 profitable branded salons, which includes several franchised/licensed salons. The company plans to become the first nationwide tanning salon chain through acquisition, corporate build-out and franchising. Paradise Tan will grow through brand name recognition as a quality salon offering a consistent tanning experience. Paradise Tan Inc.'s vision and success offer a potentially lucrative investment opportunity today. The company has experienced significant growth in size and sales. For more information on the company, please visit www.paradisetan.com.
About Pan American Relations
Founded in 2003, Pan American Relations (PAR) is a financial investor relations and corporate advisory firm focused on providing emerging companies with timely and useful guidance within the financial marketplace. For more information on the company, please visit PAR's Web site at www.parelations.com.
Certain statements in this news release may contain "forward-looking" information within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Act of 1934 and are subject to the safe harbor created by those rules. All statements, other than statements of fact, included in this release may include forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will be accurate and actual results and future events could differ materially from those anticipated in such statements.
About Chuckanut Capital Group Ltd.
Chuckanut Capital Group Ltd. is a private funding group that invests into public and private companies via equity and debt. Chuckanut's strategy involves providing low interest debt, which is serviced by the equity rounds. The client is thereby able to exercise its business plan from the debt without risk of default. Once the client becomes profitable, the debt becomes an asset, providing the client with a credit rating, increased market valuation, while proving the client's business model. The company may then remove the debt through an equity offering at a higher price with less dilution to the shareholders. For more information on the company, please visit www.chuckanutcapital.com.