AUTOMATED WAREHOUSE
SOLUTIONS
Matt Lubbers: Team Lead, CEO
Ryan Mejeur: Head of Research and Engineering [not present]
David VanKampen: Head of Sales and Marketing
David VandeBunte: Head of Technical Support, CFO
Business Plan - December 16, 2008
Vision and Initial Motivation

Entrepreneur's Vision
Reliable and cost effective method for
retrieving and storing items
 Strive to incorporate:

Creative design
 Good business ethics
 Christian principles


Initial Motivation
Interest in robotics and engineering
 Desire to create a business that can
fulfill a need for the warehouse industry

Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Products and Services
Small Store Example
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Products and Services
Products



Main Product: Item
Storage and Retrieval
Robot (STORBOT)
Additional Add-on
Features
Customer Specific
Designs
Services


Customer consulting
Support

Customer
Employee Training
 Customer Relations


Technical

Problem Solving


Phone Support
On-site Support
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Product Warranties and Trademarks

Warranties
 Mechanical
Parts Warranty
 Complete System Warranty

Patent or Trademark Protection
 No
immediate plans for Patents and Trademarks
 Trademark to be acquired after successful product
 Programming code will be protected
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Outsourcing vs. In-House Operations
Outsourcing Operations




Fully Populated PCB
Electric Motors
Electronic Sensors
Heavy Material
Machining
In- House Operations




Programming
Basic Material Machining
Peripheral Circuit Boards
Product Assembly
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
External Origin Internal Origin
SWOT Analysis
Helpful
Harmful
Strengths
Weaknesses
Customer Oriented
Inexpensive
Prototype
Development
S
Inexperienced
Low Funds
Start-up Business
Opportunities
Threats
O
Start-up Failure
Larger Companies
Economy
Niche Market
Improve Efficiency
Christian Witness
W
T
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Cost Savings Analysis

Small Stores (Hardware, Autozone, iKea, etc.)






No Employee Reduction
Efficient use of Time
Estimated 5 hours saved per week for each employee
Assume 2 employees : 5 hours * 52 weeks * 2 employees = 520 hours/year
Assume wage of $10/hour: $10/hour * 520 hours= $5200/year
Small Warehouses




Projected 25% reduction of part “gophers”
Assume 12 workers: 12 workers * .25 = 3 workers
Average worker Salary is $30,000/year
Yearly Labor Savings: $30,000 * 3 workers = $90,000
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Industry Overview
And Business Strategies
Industrial Background

Regulatory Restrictions
 OSHA

, MSDS, CFR
Barriers to Entry
 Lack
of Reputation
 Exhaustive Testing in Operational Environment
 Cost effective
 Ease-of-use

Future Industry Outlook
 Industry
pushing for Automation
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Development Stages

Startup ( < 3 years)
 Develop
product with potential customers
 Establish product locally
 Continue to improve product

Growth (3 – 10 years)
 Increase
marketing
 Expand consulting department
 Look into overseas markets
 Explore new product development
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Development Stages (cont.)

Maturity ( > 10 years)
 Develop
new products for our target market
 Expansion into new warehouse and storage markets
 Develop
daughter companies
 Create new divisions
 Market
product replacement
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Marketing Strategy
Target Market
Small Scale Warehouses and
Factories



Low weight
requirements
Minimize space
Low cost
Specific Marketing Demographic



Mostly male
Middle Class
“Experience”
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Motivation to Buy



Decrease shelf floor space
Efficient use of human time
Quick Install
3'-4 1/2"
19'-1 11/16"
25'-11"
19'-2"
7'-6"
Parts Desk
Parts Desk
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Market Size and Trends


Automation increasingly popular
Success must be proven
 No

one wants to experiment
Size is determined by product versatility
 New
uses can be found during development
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Advertising and Promotion


Trade-related periodicals
Annual trade shows
 Reflected

in budget
On-site sales calls
 Trial
Periods
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Competition Analysis
Competition

FATA Automation


Kiva Robots (Amazon)


ground up integration
shelf movers
Westfalia

palletizers
FACTOR
Low Price
Superior Quality
Customizable Product
Unique Features
Rapid Product Delivery
Customer Service
Total
Automated Warehouse
Solutions
FATA
Automation
5
5
5
4
4
5
28
Kiva Robots
(Amazon) Westfalia
1
3
3
4
4
4
3
2
4
5
4
4
3
3
4
2
4
3
18
20
22
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Company Managerial Structure
Expanded Structure
Team Lead
Head of Sales and
Marketing
Competition
Research
Consultants
Senior Sales
Supervisor
Head of Research
and Engineering
Trade Show
Staff
Sales Staff/
Trainees
Sales Team
Senior
Researcher
Robotics
Research Staff
Research
Consultants
Human
Interface
Research Staff
Head of
Engineering
Electronic
Hardware
Engineers
Head of Technical
Support
Technical
Support Lead
Phone and
Internet
Technical
Support Staff
On site
Customer
Support Lead
On site
Specialists
Software
Engineers
Mechanical
Engineers
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Financial Forecasts
Summary of expected income, cash flows, and
expenses.
Key Assumptions




Home business for the first eight months
Sales begin 3 months after operation begins
Sales increase to 5 units/month by the 2nd year.
Expect product market to double in size during the
first few years of operation.
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Income Statements

Projected income statements show profitability
beginning in third year
Income Statement:
Net Sales:
Operating Expenses:
Wages
Vehicles
Computers
Lab Equipment
Office Fixtures
Production Materials
Payroll
Property
Transportation
Repairs and Maintenance
Field Supplies
Rent
Utilities
Miscellaneous
Total Operating
Net Operating Profit:
Income Taxes:
Net profit:
Year 1
$ 100,000
$ 80,000
$
$
4,020
$
9,000
$
8,140
$ 34,800
$ 12,000
$
$
7,400
$ 16,000
$
3,440
$
4,000
$
1,000
$
2,530
$ 183,330
Income Statement:
Net Sales:
Operating Expenses:
Wages
Vehicles
Computers
Lab Equipment
Office Fixtures
Production Materials
Payroll
Property
Transportation
Repairs and Maintenance
Field Supplies
Rent
Utilities
Miscellaneous
Total Operating
$
$
$
Net Operating Profit:
Income Taxes:
Net profit:
(83,330)
(4,167)
(79,164)
Year 2
$
318,000
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
100,000
15,600
1,840
9,540
1,590
98,700
15,000
18,300
50,880
11,840
12,000
2,800
3,180
353,770
Income Statement:
Net Sales:
Operating Expenses:
Wages
Vehicles
Computers
Lab Equipment
Office Fixtures
Production Materials
Payroll
Property
Transportation
Repairs and Maintenance
Field Supplies
Rent
Utilities
Miscellaneous
Total Operating
$
$
$
(35,770)
(1,789)
(33,981)
Net Operating Profit:
Income Taxes:
Net profit:
Year 3
$
552,000
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
120,000
2,400
1,200
16,560
2,760
167,400
18,000
30,000
88,320
21,440
12,000
2,800
5,520
501,900
$
$
$
50,100
2,505
47,595
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Balance Sheet


Due to 1st year losses, owner’s equity is initially negative
In 2nd and 3rd years assets significantly greater than
liabilities
Assets
Current Assets:
Cash:
Accounts Receivable:
Total Current Assets =
Fixed Assets:
0 Cars
4 Computers
Lab Equipment
Office Fixtures
Total Fixed Assets =
Total Assets =
$
$
$
$
$
$
$
$
$
Balance Sheet: Year 1
Liabilities
Current Liabilities:
17,528
Loan:
14,000
Accounts Payable:
31,528
Total Liabilities =
2,661
Owner's Equity =
8,201
Total Liabilities and
7,893
Owner's Equity =
18,755
50,283
Assets
Current Assets:
$ (126,804.85)
$
$ (126,804.85)
$
(76,521.45)
$
50,283.40
Assets
Current Assets:
Cash:
Accounts Receivable:
Total Current Assets =
Fixed Assets:
1 Cars
5 Computers
Lab Equipment
Office Fixtures
Total Fixed Assets =
Total Assets =
$
$
$
$
$
$
$
$
$
Cash:
Accounts Receivable:
Total Current Assets =
Fixed Assets:
1 Cars
5 Computers
Lab Equipment
Office Fixtures
Total Fixed Assets =
Total Assets =
Balance Sheet: Year 3
Liabilities
Current Liabilities:
148,601.51
Loan:
52,000.00
Accounts Payable:
200,601.51
Total Liabilities =
13,230.52
2,389.08
Owner's Equity =
30,010.25
Total Liabilities and
10,784.55
Owner's Equity =
56,414.41
257,015.92
$
$
$
$
$
$
$
$
$
Balance Sheet: Year 2
Liabilities
Current Liabilities:
114,501.51
Loan:
36,000.00
Accounts Payable:
150,501.51
Total Liabilities =
14,628.12
2,922.96
Owner's Equity =
16,287.84
Total Liabilities
8,815.46
and Owner's Equity
42,654.37
193,155.88
$
$
0.00
-
$
0.00
$
$
0.00
-
$
0.00
$ 193,155.88
$ 193,155.88
$ 257,015.92
$ 257,015.92
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Cash Flow Statement – Year 1

Cash flow statements used as basis for income
and balance statements.
Jan
Feb
Apr
6,000
4,500
May
6,000
6,000
Year One
Jun
9,000
6,750
SALES
TOTAL RECEIPTS
0
0
0
0
Mar
6,000
1,500
CASH DISBURSEMENTS
Wages
Materials
Taxes
Other
TOTAL CASH DISBURSEMENTS
CASH FLOW
6,667
13,567
1,000
500
15,067
(15,067)
6,667
12,227
1,000
500
13,727
(13,727)
6,667
8,707
1,000
1,760
11,467
(9,967)
6,667
8,707
1,000
2,000
11,707
(7,207)
6,667
9,977
1,000
2,000
12,977
(6,977)
CASH AVAILABLE
Repayment
Borrowing
(15,067)
0
17,327
(11,683)
0
16,035
(6,032)
0
11,941
(1,864)
0
8,939
Loan Balance
Interest
CASH END OF MONTH
(17,327)
(217)
2,043
(33,361)
(417)
3,934
(45,303)
(566)
5,343
(54,242)
(678)
6,397
Jul
9,000
8,250
Aug
10,000
9,250
Sep
13,000
10,500
Oct
13,000
12,250
Nov
14,000
13,250
Dec
14,000
13,750
6,667
9,717
1,000
2,630
13,347
(6,597)
6,667
9,867
1,000
2,540
13,407
(5,157)
6,667
10,497
1,000
2,760
14,257
(5,007)
6,667
16,037
1,000
4,660
21,697
(11,197)
6,667
13,187
1,000
5,780
19,967
(7,717)
6,667
11,437
1,000
5,100
17,537
(4,287)
6,667
12,037
1,000
5,140
18,177
(4,427)
(580)
0
8,803
838
0
9,457
4,232
0
10,875
9,058
0
12,506
9,170
0
14,382
14,457
0
16,540
25,125
0
0
19,113
0
0
(63,044)
(788)
7,435
(72,501)
(906)
9,389
(83,376)
(1,042)
14,065
(95,883)
(1,199)
20,366
(110,265)
(1,378)
22,174
(126,805)
(1,585)
29,412
(126,805)
(1,585)
23,540
(126,805)
(1,585)
17,528
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Cash Flow Statement – Years 2-3
Year Two
Q2
Q3
69,000
87,000
64,000
81,000
Q4
108,000
101,000
Q1
120,000
116,000
Year Three
Q2
Q3
132,000
144,000
128,000
140,000
Q4
156,000
152,000
SALES
TOTAL RECEIPTS
Q1
54,000
50,000
CASH DISBURSEMENTS
Wages
Materials
Taxes
Other
TOTAL CASH DISBURSEMENTS
CASH FLOW
25,000
44,080
3,750
19,280
67,110
(17,110)
25,000
49,255
3,750
23,940
76,945
(12,945)
25,000
56,255
3,750
34,080
94,085
(13,085)
25,000
77,680
3,750
34,200
115,630
(14,630)
30,000
71,700
4,500
37,440
113,640
2,360
30,000
75,720
4,500
40,360
120,580
7,420
30,000
79,740
4,500
48,980
133,220
6,780
30,000
83,160
4,500
46,800
134,460
17,540
CASH AVAILABLE
Repayment
Borrowing
78,248
30,000
19,021
129,779
30,000
0
196,268
60,000
0
305,286
25,826
0
343,885
0
0
361,185
0
0
376,665
0
0
423,525
0
0
Loan Balance
Interest
CASH END OF MONTH
(115,826)
(1,448)
44,721
(85,826)
(1,073)
58,182
(25,826)
(323)
103,379
0
0
114,502
0
0
116,862
0
0
124,282
0
0
131,062
0
0
148,602
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Break Even Analysis

The break-even analysis was performed assuming the
company that existed at the end of year one.
Selling Cost =
Total Expenses:
Total Fixed Expenses:
Variable Cost / Unit:
3000
183330
118160
1680
Break-Even Sales (# of units) =

Total Fixed Expenses
Selling Cost - Variable Cost
=
90
Projected number of sold units for year one is 31 units
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Loan Proposal


Prototype funded from personal and donated
resources. Expected to cost $1500-2000.
This prototype and trial period information
presented to bank when applying for loan.
Amount Requested



The team would make an initial request to the bank
of $150,000 at business opening and $50,000 six
months into operation.
For complete details on the use of funds, see the
detailed cash flow statement (Report Appendix A).
Overview:
 Computers,
lab equipment
 Production materials
 Human resources
Introduction – Products – Industry/Business – Marketing – Competition – Management – Finances
Any Questions?