The Junkyard Dog - Malden High School

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The Junkyard Dog

Cameron Lucey

Grade 12

Age 18

1

Mission Statement

Mission Statement

The Junkyard Dog’s mission is to provide an affordable service with the customer always being our number one priority for timely service. The

Junkyard Dog wants the customer to be able to get rid of their unwanted junk at a price that doesn’t burn a hole in the wallet along with most efficient, courteous and punctual customer service provided. The Junkyard Dog is dedicated to making Massachusetts better, one piece of junk at a time!

Opportunity

My service is a junk removal service. My business will have a few unique features that will make my business stand out from the rest. Since my target market is located in the North Shore area of Massachusetts and the dumps are located in the same location, I will save on gas that will reduce my cost passed on to the customer. Also, we guarantee a 24-hour turnaround time. If you call and want the job taken care of that afternoon, we’ll make every effort to do it that afternoon, but we guarantee it will be done by the next day.

2

Business Profile

Type of Business

Service Business

The Junkyard Dog is a service company that removes unwanted junk from people’s homes for a reasonable price. People always have tons of junk lying around that they want to get rid of, but they don’t want to pay the expensive prices to get it hauled away.

Legal Structure

Sole Proprietorship

A sole proprietorship made the most sense for me. I wanted to be my own boss and have independence.

Having my own business would allow me to run the business the way I wanted to run it, without someone else having a say.

3

Qualifications

I’m qualified to run this business because:

I have taken Business Management and Entrepreneurship, which have given me a basic understanding of what it takes to start and run a business.

I’m not afraid to get my hands dirty, and that’s a must with this business.

Both of my uncles own a plumbing business, and I’ve worked with each of them for a couple of weeks over the past few summers. I’ve gotten first-hand information on how to run a business. I’ve seen what it takes, and I now know what I need to do to make my business successful.

4

Industry Name

Industry Size

Market Analysis

Junk Removal Service (SIC Code: 4212)

3,660 in Massachusetts

Total Population

The business location is in Malden,

Massachusetts, but it would serve clients in the North Shore area which includes

Lynn, Revere, Malden, Saugus,

Peabody, Beverly, Danvers, and Salem.

Target Market

Adults, both male and female, ages 25-85+, with an average income of greater than $45,000.

Potential Market

Size

Based on a survey of 10 individuals from the target market, I believe that my potential target market size is 70% of the target market.

90% have junk that they want to get rid of.

• 70% said they don’t want to pay the expensive prices to get rid of the junk.

• 70% said that they would try my business if I started it.

Total Population

450,720

Target Market

322,288

Potential

Market Size

225,602

5

Target Market Segment

Demographics

Adults, both male and female, ages 25-

85+, with an average income of greater than $45,000.

My target market is your average everyday adults, from the age of 25 to over 85. During this age period, people have left college and are now out on their own in the world. Since they are now living on their own, they are most likely starting to accumulate junk that they don’t want.

Geographics

My business would serve clients in the

North Shore area of Massachusetts

(Lynn, Revere, Malden, Saugus,

Peabody, Beverly, Danvers, and

Salem). My target market would ideally work and live in those cities.

Psychographics

My target market is just your average adult. They are the working middle class and don’t have a lot of extra money to spend. They have families, and they have acquired tons of junk over the years. Much of their free time is spent with other members of their family.

Buying Patterns

My target market are not the type to go crazy with their purchases. They don’t have a lot of money, so they don’t spend money on stuff they don’t absolutely need. They are not cheap.

They just want to make wise decisions with their money. My customers are probably a one-time customer who will tell others about my business.

6

Competitive Advantage

Factors

The Junkyard

Dog

Tony’s Clean

Up Service

Tiger

Dumpsters

Price

Quality of

Product/Service

Location

Reputation/Brands

Unique Factors/

Knowledge

$300

Great

Malden, MA

New &

Growing low gas surcharge;

Same day service

$350

Excellent

Malden, MA

Dependable

& Efficient

Bobcat

Service;

Dumpster

Rental

$385

Good

Melrose, MA

Reliable & On

Time

Demolition

Work;

Storage

Containers

7

Adults, both male and female, ages 25 to 85+, with an average income of greater than

$45,000.

Marketing Mix

Malden, Massachusetts

•Online website

•Facebook

•Twitter

•Newspaper ads

People Product

Junk Removal company that removes unwanted junk from people’s houses for a reasonable price.

Place Price

• Prices vary based on the job

• Example: Average price to clean out garage = $300

Promotion

8

Advertisements

Promotional Mix

Sunday Boston Globe, 4 weeks in Spring

Business cards

(

Free on Vistaprint.com

)

Sales Promotion

Publicity Press Release in the Malden Observer

Personal Selling

Networking with junkyards and Estate Attorneys

Other

Youtube video showing the before and after of one of our jobs

Total Monthly Promotional Expense

$577/week

$0

$0

$0

$0

$2,308

9

Cost of

Materials/Labor

Material Description

Tank of gas for pick-up truck

Dumpsters

Materials

Cost/Total Quantity

$57.00

Cost per Unit

$57.00

1 dumpster =

$60/month

$60.00

Total Material Cost per Unit

$117.00

Labor

Labor Cost per Hour

$15.00

Time (in Hours) to

Make One Unit

2 Hours

Total Labor Cost per Unit

Labor Cost per Unit

$30.00

$30.00

COGS (per Unit)

$147.00

10

Economics of One Unit

Description of One

Unit of Sale:

The clearing out of one room (attic, garage, etc.) and the removal of one full truckload of junk.

Selling Price (per Unit)

$300

$147

COGS (per Unit)

$0

Other Variable Expenses (per Unit)

Total Variable Expenses (per Unit)

Contribution Margin (per Unit)

$147

$153

11

Average Monthly Fixed Expenses

Fixed Expense

Insurance

(on Truck)

Salaries of Employees

(2 Employees)

Advertising

(Boston Globe in Spring)

Interest

Depreciation

(Truck)

Utilities

(Gas & Cell phone)

Rent

Other Fixed Expenses

Total Average Monthly Fixed Expenses

Average Monthly Expense

$100

$768

$200

$0

$303

$420

$0

$0

$1791

12

Time-Management Plan

Schedule for a Typical Week

Total Hours in a Week = 168

0 10

School

40

Work

52

New Business

39

Free Time

37

20 30

Hours

40 50 60

13

Monthly Sales Projections

First Year

Total Units

Sold

188 Units

30

25

20

15

10

5

0

Ja nu ar y

Fe br ua ry

M ar ch

A pr il

M ay

Ju ne

Ju ly

A ug us t

Se pt em be r

O ct ob er

N ov em be r

D ec em be r

14

Monthly Break-Even Units

$1791

11.71

$153

In an average month, the company will begin to make a profit after selling

12

.

units.

15

Projected Yearly Income Statement

First Year

$300

188 units

E

F

G

H

I

A

B

C

D

Selling Price per Unit

Number of Units Sold

Total Sales

Variable Expenses

Contribution Margin

Fixed Operating Expenses

Pre-Tax Profit

Taxes @ 15%

Net Profit

0

$21,492.00

$5,236.20

$56,400.00

$56,400.00

$34,908.00

$29,671.80

16

Start-Up Investment

Item

2005 Ford Ranger

Start-Up Expenditures

Where Will I Buy This?

Given to me by Uncle

Work Boots

Storage Barrels

Safety Goggles

Shovels & other tools

(hammers, pipe cutters, pliers, etc.)

Sears

Given to me by Uncle

Lowe’s (3 X $9)

Home Depot & Lowe’s

(2 of each)

Total Start-Up Expenditures

Cash Reserves

Emergency Fund

Reserve for Fixed Expenses

$272.00

$2000.00

$1250.00

Cost

$0

$85

$0

$27

$160

Total Start-Up Investment

$3,522.00

17

ROS & ROI

ROS: Return on Sales

Formula:

For My Business:

AnnualNetProfit

X

100

ROS

%

AnnualSales

$29, 671.80

$56, 400.00

X

100

52.6%

Formula:

ROI: Return on Investment

AnnualNetProfit

X

100

ROI

%

For My Business:

$29, 671.80

X

$3,522.00

$0.53

$8.42

18

Financing Strategy

Total Start-Up Investment

Source Amount

$3,600.00

Debt Equity

$2,000

Personal Savings

My Parents

Investor

Partner(s)

Totals

$1,600

$0

$0

$3,600

$0

$0

$0

$0

$0

$0

$0

$0

Gift

$1,600

$1,600

19

Business Responsibility

& Philanthropy

Business Responsibility

The Junkyard Dog will devote themselves to being environmentally

friendly. All employees will be trained to recycle and beware of their obligation to protect the environment.

Philanthropy

My business will give back to the Dana Farber Cancer Institute.

When my mother was diagnosed with breast cancer, they did so much for my family and helped us get through a very difficult time.

I also want to sponsor a team in Malden West Little League. Playing sports is a way for some kids to get away from the troubles of the world and clear their heads, so I want to be able to help out some of the youth in my community.

20

Business & Personal Goals

Business Personal

Open/Start The Junkyard

Dog

Complete first year as owner of The Junkyard Dog

Graduate from Malden

High School, June 12, 2011

Attend UMass-Amherst,

Fall 2011

Continue to run the business through college

After college, sell business to one of my younger brothers, who will expand the business

Graduate from UMass-

Amherst after earning my

Bachelor’s and Master’s in

Sport Management

Use Sport Management degrees to work my way up ladder and become a GM of a pro sports team

21

No Job’s too tough or too ruff for

The Junkyard Dog.

Thank you for your consideration.

The Junkyard Dog

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