Business Plan
XYZ Corporation
54321 Calabasas Road
Calabasas, CA 91302
818-223-9110
December 2007
XYZ Corporation
Business Plan
Table of Contents
1.0
Executive Summary
1.1
Mission Statement
1.2
Enterprise
1.3
The Market
1.4
Keys To Success
3
3
3
3
3
2.0
Company Summary
2.1
History / Mission
2.2
Experience
2.3
Employees
2.4
Market Location
2.5
Market
4
4
4
4
5
5
3.0
Products & Services
3.1
Market Needs
3.2
Offering
3.3
Planning
3.4
Trade Support
3.5
Benefits
6
6
6
6
6
7
4.0
Market Analysis
4.1
Industry
4.2
Target Market / Audience
4.3
Age Breakdown
4.4
Audience Needs
4.5
Competition
8
8
8
9
9
10
5.0
Strategy And Implementation Summary
5.1
Growth Strategy
5.2
Future Market Strategy
5.3
Pricing Strategy
11
11
11
12
6.0
Management Summary
13
7.0
Financial Status Summary
7.1
Expenses
7.2
Assets
7.3
Liabilities
14
14
14
15
8.0
Financial Statements
8.1
Income Statement
8.2
Cash Flow Projection
8.3
Balance Sheet
16
17
18
19
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XYZ Corporation
1.0
Business Plan
Executive Summary
Following is the business plan for XYZ Corporation. Included is a company profile,
a description of the product and services offered by XYZ Corporation, an analysis of
the current market conditions, the needs of that market and how, through specific
implementation strategies, XYZ Corporation meets the needs of this market.
1.1
Mission Statement
XYZ Corporation is committed to being the focal point of contact between
homeowners and trades people during the home remodeling process.
1.2
Enterprise
Founded in 2007, XYZ Corporation operates under the sole ownership and
direction of its original principle, Ms. Gabrielle Manteca. Located in
Calabasas, California, XYZ Corporation is geographically situated within an
up-scale market, ideally suited for its core business.
1.3
The Market
The home remodel market currently lacks the comprehensive project
management services offered by XYZ Corporation. This is a market
historically plagued with long-lead times and disjointed operations. There is a
great need within this market for effective goal setting, detailed pre-planning
and strict follow through to completion of the remodel job.
1.4
Keys to Success
The keys to XYZ Corporation’s success include the experience and
knowledge of the remodel industry. Backed with a commitment to satisfy
every wish of the customer, XYZ Corporation works hand-in-hand with only
qualified pre-screened craftsman delivering the finest quality work and
ensuring every job is accurately completed down to the last detail.
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XYZ Corporation
2.0
Business Plan
Company Summary
2.1
History / Mission
Created in 2007, XYZ Corporation established itself as a small business
concern designed to fulfill the special needs and requirements of project
management as related to and within the home remodel industry. XYZ
Corporation’s unique mission is to act as the single point of contact between
the homeowners and the various representatives of the remodel industry, i.e.
general contractors, designers, architects, etc., following through with every
aspect of the remodel scenario until completion.
Developed out of the frustration felt from her own remodeling experiences,
Ms. Gabrielle Manteca determined there was a need within this market for
project management intervention between the client or homeowner and the
general contractors. A liaison that would coordinate all the planning of the
project and then follow through with each and every detail until the project
was complete. This position would lend peace of mind for the inexperienced
consumer trying to work their way through even the smallest of remodel jobs.
2.2
Experience
As sole owner of XYZ Corporation, Gabrielle Manteca has gained personal
experience working closely with general contractors, designers and real estate
agents. Ms. Manteca has attended and worked through UCLA’s PMBOK
(Project Management Body of Knowledge) program and she is currently in
the process of obtaining her own General Contractors license from the State
of California.
2.3
Employees
As XYZ Corporation starts within this service industry, Ms. Manteca will
initially be the only employee handling all aspects of the business directly.
As the client base grows, additional employees will be hired to help with job
site and office administration.
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XYZ Corporation
2.4
Business Plan
Market Location
Initial market penetration will begin in Calabasas, California. Calabasas is an
upscale neighborhood where home remodeling is a common occurrence given
the current conditions of the real estate market.
2.5
Market
A large potential client base, ideal economic conditions, minimal competition
and a large volume of personal experience are all positive indicators for XYZ
Corporation to be a successful entrant into this unique market.
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XYZ Corporation
3.0
Business Plan
Products & Services
3.1
Market Needs
The home remodeling sector has historically been linked with long lead times
and disjointed operations. This inconsistency lends itself to frustration and
disappointment by the homeowner. Viewing this problem as an addressable
opportunity, XYZ Corporation counters the historically poor planning of
remodeling issues by offering hands on accountability for every individual
job.
3.2
Offering
Operating within the service sector, XYZ Corporation acts similar to that of a
conductor directing an orchestra, XYZ Corporation coordinates the many
detailed steps required to complete the home remodel project. Representing
both client and vendor, XYZ Corporation XYZ Corporation is the central
contact committed to the project’s completion.
3.3
Planning
Through an informative and relaxed one-on-one planning session with the
homeowner, XYZ Corporation establishes the most economical and efficient
path to completion of the custom renovation for each individual client. Every
step is scrutinized to ensure the client is aware of all conditions long before
they become a reality. 100% customer satisfaction is the driving force behind
XYZ Corporation as every satisfied customer increases the possibility of
spreading their positive experiences through word of mouth to their friends
and acquaintances.
3.4
Trade Support
XYZ Corporation works exclusively with an elite group of contractors and
designers experienced in every facet of the home remodeling industry. Each
contractor and designer within this group has been prescreened to determine
their levels of experience, ability, reputation, quality of work, and customer
service. Only those contractors demonstrating the highest levels in each of
these arenas are considered possible candidates for partnering with XYZ
Corporation.
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XYZ Corporation
3.5
Business Plan
Benefits
Accountability
XYZ Corporation is accountable for the homeowner’s complete
satisfaction. From initial contact to job completion, XYZ Corporation
works directly with the homeowners and contractors to ensure every
step is followed through as planned and will take the appropriate
action when interference or deviation occurs.
Confidence
Home remodels can be very emotional in nature. Concerned
homeowners can have confidence of knowing that their best interests
are priority one with XYZ Corporation. Clients are kept fully
informed of the progress with their custom project, as they are
involved with every major decision concerning its direction.
Ease of Use
Individual attention and customer service are the cornerstone
philosophies of XYZ Corporation. Having gone through their own
remodels in the past, XYZ Corporation personnel understand and
appreciate the need to ensure ease of use in a smooth process,
especially when one is dealing with a major personal asset such as a
home.
Experience
Experience goes far beyond words when it comes to being aware of
and familiar with all the things that can happen during a remodel
effort. Experience knows what to look for and when to look for it.
Although a young company, XYZ Corporation has gained invaluable
insight in the remodel sector through both hands-on experiences as
well as through knowledge gained within the educational sector of
UCLA’s Architectural Department.
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XYZ Corporation
4.0
Business Plan
Market Analysis
4.1
Industry:
The home remodeling industry is the primary target market for XYZ
Corporation. With the real estate market in constant turmoil over refinance
and second mortgage concerns, the level of houses sold in the Calabasas area
are expected to remain relatively flat. This fact is further supported by the
fact that loan organizations expect the refinance-to-new loan percentage to
remain constant at approximately 50% for 2008, just as it has been in 2006
and 2007.
3
2.5
2
2006
1.5
2007
1
2008
0.5
0
Loans
Refinance
Given the multitude of remodel options available, the cost to remodel as
opposed to buying a new house could grant homeowners hundreds of
thousands of dollars in potential savings as well as increase the overall equity
in their home.
4.2
Target Market/ Audience:
The target market of XYZ Corporation is homeowners who are living in the
middle to upper scale communities of California with the initial market
concentration located in the Calabasas, California area. XYZ Corporation
will market to the influential small family households targeting the housewife
as initial contact for the beneficial services of XYZ Corporation. Dependent
upon each particular job, the housewife will remain the focal point of contact
throughout the remodel process unless otherwise arranged.
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XYZ Corporation
4.3
Business Plan
Age Breakdown:
Although no direct marketing research has been completed yet, assumptions
of the age group related to this particular market audience is expected to
reflect the following:
Ages 25 to 30 years old
15%
Ages 31 to 40 years old
60 %
Ages 41 and beyond
25%
60
50
40
Ages 25 to 30 Years Old
30
Ages 31 to 49 Years Old
20
Ages 41 and Older
10
0
Percent of Target Market
4.4
Audience Needs:
The critical needs of this target audience as identified by XYZ Corporation
are knowledge of the remodel industry, accuracy in the planning and work
and the ability to control multifaceted construction processes while ensuring a
smooth, ongoing home enhancement. XYZ Corporation will keep this target
audience informed with the following:
Knowledge of:
Construction requirements for proper remodeling.
Contractors, their strengths and weaknesses.
City construction codes and requirements
What clients need and expect when working with XYZ
Corporation.
Accuracy of:
The pre-screening process for vendors.
Initial project setup based upon client vision.
Follow through of every predetermined detail of the project.
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XYZ Corporation
Ability to:
4.5
Business Plan
Control timing of every aspect of the project
from start to finish.
Oversee what and when the contractors Contractor’s do
according to preset expectations.
Competition:
The competition within this industry can be tailored into three individual
markets:
1) The large home improvement sector that directs remodel jobs while
encouraging the use of their own products and service, (i.e. Home Depot,
Lowes etc).
2) The on-line home improvement market where selected contractors are
listed within a web site conglomerate as industry leaders and experts, but the
homeowner is left with the responsibility of conducting and coordinating
tasks between contractors and all the associated legwork themselves.
3) Project Management companies such as XYZ Corporation who help with
the initial design, align the various contractors and ensure all work proceeds
as originally determined until the project is complete. Competition within this
category rests with two to three companies within the Calabasas area. With
the large volume of potential clients in Calabasas, this ensures market share
penetration in alignment with the growth goals of XYZ Corporation as
detailed in the Strategy and Implementation section that follows.
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XYZ Corporation
5.0
Business Plan
Strategy and Implementation Summary
The overall marketing strategy of XYZ Corporation initially lies with a high volume
of personal contacts within the local fields of general contractors, real estate, internal
design, accountancy, and the legal industry. Through an already established network
base, all these contacts have and are willing to offer a multitude of potential clients
with which XYZ Corporation will begin its initial client contact.
5.1
Growth Strategy:
XYZ Corporation growth strategy is to begin very slowly, acquiring one
qualified project within the first quarter, increasing to 2 within the second
quarter, four projects within the third and fourth quarters and continuing to
increase projects up to 8 within the fifth and sixth quarters.
8
7
6
5
4
3
2
1
0
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
Fifth to Sixth Quarters
Number of Projects
All growth will be done slowly and meticulously to ensure each project is
done with 100% customer satisfaction. Growth will be monitored so as not to
take on too much business that it cannot be efficiently handled or result in
tasks that are not completed within preplanned timings.
Once established as a viable business entity, XYZ Corporation will
implement a growth strategy based upon continuous networking through
established contacts as well as networking based upon newly established
contacts developed through XYZ Corporation’s business growth
development.
5.2
Future Marketing Strategy:
XYZ Corporation’s future market penetration will be to enter into all aspects
public relations and marketing for which contacts have already been
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XYZ Corporation
Business Plan
established. Three individual market directions will lead the marketing
efforts:
A) White Paper – For presentation to potential contractors describing the
benefits of partnering with XYZ Corporation for mutual business growth.
This will include XYZ Corporation’s historical background, current and
future business growth.
B) A complete Business Plan directed towards the financial aspects of XYZ
Corporation. This will be used to detail all current and historical
expenditures, assets and liabilities and incorporate projected future
financial aspects and statements for presentation to financial institutions
and other concerned industry segments as applicable.
C) Product Brochures – for potential clients describing the benefits and
features of utilizing XYZ Corporation to manage their particular remodel
project. This will include an initial handout brochure to gain and judge
interest for XYZ Corporation as well as a more detailed brochure for
potential customers showing a higher degree of willingness to take the
next step towards remodeling.
Depending upon the confirmed growth of XYZ Corporation, the rate at which
this occurred, the number of employees hired to sustain the company growth
and the overall health of the business, future marketing efforts could include
magazine advertisements in one or more of the upper scale local magazines
which target high end homes and local businesses which support those
markets. Other local mailing companies also offer advertising targeted
towards the construction and remodeling sectors, which are mailed to
homeowners within these upscale neighborhoods.
5.3
Pricing Strategy:
The pricing structure of XYZ Corporation is currently under consideration.
Each individual job will be unique and custom as to its overall bid price or
quotation and based upon the size of the remodel, the difficulty of the remodel
and the timing of the remodel.
Initial quotes will entail one-on-one discussions with the homeowner to
determine their ultimate remodel expectations. Once completed, a complete
review of all anticipated expenses, from the project itself as well as XYZ
Corporation expenditures for office and administration purposes will be
determined. From this point a formal quote for bid will be presented to the
homeowner.
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XYZ Corporation
Business Plan
Once established and a firm feel for actual expenses has been determined by
a variety of remodel jobs, a price list describing general remodel options will
become available for presentation within a product brochure. However,
ultimately, all quotes and bids will be custom to the individual project.
6.0
Management Summary
The management team of XYZ Corporation will initially be limited to Ms. Gabrielle
Manteca in the role as President. She will be 100% accountable for all aspects of
operating XYZ Corporation as a business entity and will also be completely
responsible for any profits and losses as a result of her management style.
Ms. Manteca has gained personal experience working closely with several local
general contractors, designers and real estate agents.
Ms. Manteca has an extensive educational background within the architectural
remodeling sector. She has been educated through the Villanova for Project
Management, which was modeled directly from PMBOK, the industry standard for
project management. Ms. Manteca has also been through several UCLA extension
courses for Residential Remodeling.
In a continuing pursuit of her goals for XYZ Corporation Ms. Manteca is currently
working towards obtaining her General Contractors license through the State of
California. This will propel her knowledge and credibility towards becoming an
expert within the remodeling industry and greatly enhance her marketability in the
near future.
As the business grows, additional staff may need to be hired to help handle XYZ
Corporation’s office administration, but that will need to be determined in the future.
13
XYZ Corporation
7.0
Business Plan
Financial Status Summary
As XYZ Corporation is a service-based business, relatively little funding is needed
for start up. As a result, all initial funding requirements will be directed through Ms.
Manteca’s accountant. Listed here are expected expenses and known assets that will
be used for and applicable to the operations of XYZ Corporation.
7.1
Expenses:
Anticipated first year expenses are expected from the following areas.
Additional expenses will be covered as they occur.
7.2
•
Business set-up expenses: Attorneys, Accountants, and Legal
•
Insurance
•
Taxes: business and personal
•
Public Relations
•
Payroll
•
Travel / Gas
•
Licensing Fees
•
Administrative
Assets:
The following items describe the assets of XYZ Corporation to be used in the
initial startup. Additional assets will be included as required and as the
business grows:
•
Laptop computer
•
PDA device
•
Printer
•
Fax
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XYZ Corporation
7.3
Business Plan
Liabilities:
XYZ Corporation has no current liabilities as it begins initial business
practices. There are no current plans for any capital expenditures or any
investments of any sizeable amounts. There are neither any loan burdens nor
plans to acquire any at this time.
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XYZ Corporation
8.0
Business Plan
Financial Statements:
Due to the projected growth of XYZ Corporation and the uncertainty of
precise expenses applicable to the overall operations of XYZ Corporation, the
following financial data will be posted on a “to be determined” (TBD) basis
for the interim so it can be filled in with applicable data at a later time.
There are many important financial formulas businesses use to keep financial
visibility over their operations. Included here are three primary statements
that will cover the major financial aspects for XYZ Corporation:
8.1
Income Statement: Also known as a profit and loss statement, this
statement will show all applicable revenue and expenses for XYZ
Corporation over a period of one year.
8.2
Cash Flow Projection: A cash flow projection statement shows how
cash is expected to flow in and out of XYZ Corporation for its first
year in business.
8.3
Balance Sheet: Will be used to summarize at a given point in time, all
the financial data about XYZ Corporation within three categories:
assets, liabilities and equity. This statement will determine the actual
net worth of XYZ Corporation.
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XYZ Corporation
Business Plan
8.1
Income Statement
2008
1st Qtr.
2008
2nd Qtr.
2008
3rd Qtr.
2008
4th Qtr.
2009
12 Month
2010
12 Month
Revenue
Revenue / Sales
Interest
Total Revenue
Expenses:
Direct Costs:
Admin. Materials
Salary (Owner)
Marketing Expenses
Total Direct Costs
General & Admin Costs:
Accounting / Legal Fees
Advertising / Promotion
Bad Debts
Insurance
Interest
Office Rent
Telephone
Travel
Other
Total General Costs
Total Expenses
Net Income Before Taxes
Income Taxes
Net Income
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XYZ Corporation
Business Plan
8.2
Cash Flow Projection
Jan
Feb
Mar
Apr
May
Jun
Jly Aug
Sep
Oct
Cash Revenues
Revenue from Projects
Other Revenue
Total Cash Revenues
Cash Disbursements
Payments to Vendors
Management Draws
Salaries / Wages
Promotional Exp. Paid
Prof. Fees Paid
Rental Payments
Insurance Payments
Tele-com Payments
Utilities Payments
Other Payments
Total Cash Disbursements
Reconciliation of Cash Flow
Opening Cash Balance
Add: Total Revenues
Deduct Cash Disbursed
Closing Cash Balance*
* Amount is carried over to beginning of next month.
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Nov
Dec
XYZ Corporation
Business Plan
8.3
Pro Forma Balance Sheet
Assets
2007
2008
1st Qtr.
2008
2nd Qtr.
2008
3rd Qtr.
2008
4th Qtr.
2007
2008
1st Qtr.
2008
2nd Qtr.
2008
3rd Qtr.
2008
4th Qtr.
Current Assets
Cash in Bank
Petty Cash
Accounts Receivable
Inventory
Other Current Assets
Total Current Assets
Long Term Assets
Long Term Assets
Accumulated Depreciation
Total Long Term Assets
Total Assets
Liabilities and Capital
Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities
Long-term Liabilities
Total Liabilities
Paid-In Capitol
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital
Net Worth
19