QUESTION 7: If Saeed wanted to open a cycling spin class studio in Niagara on the Lake that will be 750 sq ft. Using the SPACE model to evaluate the potential of opening a new spin class studio in Niagara on the Lake. Consider factors like industry attractiveness and the competitive advantage of the potential business.

Background: Niagara on the Lake is a picturesque town located in the Niagara Region of Ontario, Canada. It's renowned for its wineries, historic sites, and a rich cultural scene. Recently, there's been an increase in the health and fitness consciousness among its residents.

• Population of Niagara on the Lake: 17,500 residents.
• Existing Spin Class Options:
• SpinCycle Studio: A boutique studio with an area of 1500 sq. ft.
• Lakefront Spinners: Situated near the waterfront, this studio has an area of 1200 sq. ft.
• Energize Spin Hub: Located in the heart of the town, it spans 1600 sq. ft.
• The average Canadian spends $620 a year on fitness memberships.
• Saeed estimates his customer segment represents 15% of the population in his desired town.
• Most of his start up inventory is already in the space and has been given to him, with the exception of a few additional items he needs which will cost him 10% of his sales.
• His operating costs are $12,500 annually.

1. Using the space method what is the market potential for Niagara on the Lake?
2. Develop a sales forecast for his market share. Express this as a percentage and in dollars.
3. What is his expected net income?