Business Plan Competition December 6-7, Prison Entrepreneurship Program P.O. Box Houston, TX (832)

Transcription

1 Business Plan Competition December 6-7, 2018 Prison Entrepreneurship Program P.O. Box Houston, TX (832)

2

3 Aback Dump Trucks Delivering on the promise of your satisfaction guaranteed Business Plan June 2018 Owner & Founder

4 TABLE OF CONTENTS EXECUTIVE SUMMARY...1 PERSONAL FIT...2 OPPORTUNITY...2 SOLUTION...3 CUSTOMERS...3 DIFFERENTIATORS...6 EXTRAS...7 MARKETING...7 FINANCIAL PROJECTIONS... ATTACHED

5 EXECUTIVE SUMMARY Opportunity Purpose Solution We offer a freight service that is dependable, while at the same time providing employment opportunities to locate members of our community. 70% of U.S. freight is moved by eighteen wheelers. As of 2018, there is a shortage of over 51,000 tractor trailer drivers. We will providing freight services and drivers to meet the growing demand for freight delivery. Customers Differentiators Extras Our primary target customers will be in the oil and gas industry, and the commercial construction industry. Our competitive advantage will be built over time, which are reliability, dependability and the timely manner in which we serve our customers. I do have a small network in the oil and gas industry along with some in the commercial construction industry. Marketing Start-up Costs Financials & Extras We will market our business using business cards, fliers, social media, and our company website. Owner Inv. - (Cash) $ 65,500 Owner Investment (Equipment) $ - Vehicle/equipment Loan $ - Unsecured Debt/Loan $ 5,000 Equity Investment $ - Total start up costs: $ 70,500 Sales: $ 176, % COGS 59,100 34% Gross profit 116,800 66% Overhead 41,400 24% Pretax income 75,400 43% Tax expense 18,800 11% Owner withdrawals 55,000 31% Net income $ 1,500 1% Personal Fit I have over two years of experience trucking industry. My passion and dream is to own and operate my own freight company.

6 PERSONAL FIT Jason is founder and owner of Aback Dump Trucks. Jason will be responsible for the day to day management of this company which includes marketing, advertising and general management of the company. Jason is experienced as an 18 wheeler operator, he s also experienced in shipping and receiving, accounting and management. Jason is very familiar with customer service and business operations. He also brings a high level of confidence to this full time venture and serious work ethic. In 2008, Jason received his General Equivalency Diploma where he then received 15 college credits. In 2010, he became a certified commercial diver. OPPORTUNITY Explanation: The long haul sector for commercial truck drivers employs over 500,000 drivers. At the end of 2017, there was a shortage of over 51,000 truck drivers in the United States. This issue raises shipping cost which is then passed on to consumers. Can I solve the problem given my skills and personality? Yes, I have the skills necessary not only to drive 18 wheelers but to also run a business. Is the customer looking for a more holistic solution than his or her immediate complaint? Yes, the customer is looking for a holistic solution to their needs. Do I need to do all of the work myself or can I hire others to help me and still maintain quality? I can most definitely hire others and still maintain quality in my service. Is there growth potential to expand my business, or is this a dying market? Yes, there is plenty of room for growth. How soon can I get my business up and running? I will be up and running two years after my release. Is this something that will take a lot of cash to get started or is it more of a question of hustle? It will need cash but for me it will take some hard work. Is this something I would be proud to share with my family and parole officer? I am definitely proud to share this with my family and parole officer. Is the opportunity (Activity and Start Date) consistent with potential parole restrictions? Yes, I will be off parole. Would my business start as a part-time venture or need to be full time? It will be a full time venture. Aback Dump Trucks 2

7 SOLUTION Explanation: I will provide freight services in an industry that desperately needs drivers. Providing reliable on time deliveries and always willing to go the extra mile for our customers. Is what I am offering filling the customer s real need? Yes. It will ultimately serve the need of every American. What are the benefits (not features) that I am providing? Reliable skilled commercial drivers. Why can I do this better than another business (competitor)? To me it s about my skills, passion and vision. How will I deliver this better idea to my customers? By being very professional and proving to be a reliable service. Is my delivery (retail store, home service, etc.) consistent with how I will produce the service (one-day delivery, hand-made products, etc.)? Yes. I will transport freight as needed for my customers. Is my solution consistent with my passion for selling? Yes. My passion for what I want exceeds my mind. Is the price of my solution equal to or less than the customer s pain? Less. The demand is so great that it s almost priceless. Is the approximate cost of my solution lower than the price? Yes. I can make a very healthy profit. Do I need a fixed location (Storefront) or is this a mobile business? A fixed location. Do I offer a guaranty or return policy? We will offer a guarantee of on time delivery. If not, we will give 10% off on our next delivery. CUSTOMERS Explanation: My target customers will be the gas and oil companies, specifically those that are involved in fracking. Demographics: Will my service have different appeal to men versus women? No, men and women if you are involved in the gas and oil industry and you oversee these operations. Then you know the demand of my service. What is my ideal customer s age (children, young adult, middle aged, mature)? My customers age will most likely be middle aged to mature adult. Does my customer need to be married, single or does it matter? No, it really doesn t matter if my customers are married or single. Do language or ethnicity differences improve or limit my ability to sell to my ideal customer? Aback Dump Trucks 3

8 We are a bilingual organization and will service clients that speak either English or Spanish. What aspect of my ideal customer am I appealing to (outdoors person, health conscious, nerd, their personal image, environmental concerns, recreation, etc.)? My customers are likely to have some environmental concerns as they always do in their industry. Income: Does my customer need a certain income (rich, middle class, poor)? My customers should be pretty wealthy. Does my customer need to own specific assets (car, house, boat)? Most likely they own a refinery or a fracking company. Location: Where will I sell to my customers (their home, their workplace, on the street, online, my store, an event like trades day)? We could do business at trade shows but it will likely take place at their office or mine. Do I go to my customer (home service) or does my customer come to me? I will seek out my customers and there is a good chance they will seek me. What neighborhood will my ideal customer live/work in (River Oaks/Highland park, a suburb, or small rural community)? They most likely will live in a wealthy neighborhood and work in the middle of nowhere. How close are my customers geographically located (live close to each other or spread all over the city)? Time is money. My customers are spread out over many cities and even states. How easily can I find this customer (one at a time or they will provide referrals)? I will find them one at a time and I m pretty sure they will also provide referrals. Other: Can I reach these individuals as a group or do I need to find and sell to them individually? I will have to locate them individually and get contracts on the table. Once I sell to a customer, what is the likelihood that they will buy from me again? Any customer I get is almost 100% likely to be a repeat customer. Am I selling to a wholesaler, retailer or does it matter? I will do business with both. What industry is my customer in? My customer is in the gas and oil industry. What size customer do I want to serve (large/small, single/multiple locations)? I want to serve large, multiple location companies. Will my customer require special insurance (construction bonding, liability insurance)? We will have the appropriate insurance coverage. Does my customer require 24/7 service? Aback Dump Trucks 4

9 Yes I will have the ability to serve my customers 24/7. Do I have the capacity to meet the customer s demands? No, however I will be helping them solve their problem one load at a time. And at the same time due to such great demand it gives my business plenty of opportunity for growth. Will the size of a customer allow me to develop other clients or will I be hostage to one company? All I really need is one good customer. However with time and the growth of my company it could prove to be very beneficial to have multiple customers. Aback Dump Trucks 5

10 DIFFERENTIATORS UNEDITED My Competitors Direct or Indirect Promotion Brazos Sand Indirect Billboards, ads, radio, TV, and newspapers Price $400 a load Their Advantages Brand well known Their Disadvantages Not enough trucks to satisfy their customer s needs My Differentiators Cost effective and offer more services than the competition Dorsett Brothers Indirect Billboards, ads, radio, TV, and newspapers $250 a load Brand well known Not enough trucks to satisfy the customer s needs Cost effective and offer more services than the competition ABC Dump Trucks Direct Billboards, ads, radio, TV, and newspapers $40 an hour Brand well known Not enough trucks to satisfy the customer s needs Cost effective and offer more services than the competition AAA Dump Trucks Direct Billboards, ads, radio, TV, and newspapers $400 a load Brand well known Not enough trucks to satisfy the customer s needs Cost effective and offer more services than the competition E-Z Dump Trucks Direct Billboards, ads, radio, TV, and newspapers $600 a load Brand well known Not enough trucks to satisfy the customer s needs Cost effective and offer more services than the competition Aback Dump Trucks 6

11 EXTRAS External Extras: Do you have a connection with a supplier in your industry? At the moment I do not, but I will be doing a lot of networking upon release. Do you have access to a favorable location for your business? I do have friends that have offered to help me in growing my company, including all aspects of managing my business from accounting, taxes, computer networks and a website. Are you going to be the first company of your type in your chosen area operations? I will not be, but I plan on building a competitive advantage over the course of time Internal Extras: Do you have a new or cutting edge concept? Bonus plan for driver safety. Will you be able to offer specialized or flexible scheduling that your competitors cannot match initially? I will offer a 24/7 service. Are you an especially charming or personable person? I am a people person. MARKETING Message What are three things your company name (with no other information provided) says about your company? It says that our customers needs will always be met, that we are always reliable, and we generally care about our employees. What is your tagline? Solving your problems One Load at a Time! How does your name and tagline make you different than your competitors? I recognize that the lack of drivers in this industry is a problem for all of the consumers in America. Can your message be effectively conveyed through multiple types of media? Yes our message can be conveyed through magazines webpage, and newspapers. Is your message effective across different demographics? Our message actually speaks to all demographics. Is your pricing consistent with the market for similar offerings? We offer competitive pricing. Is your pricing consistent with the degree of personalization? The distance of delivery and merchandise will be a factor in the pricing of our service, commitment or reliability. Media: What are three types of media you will use to reach your customers? Aback Dump Trucks 7

12 We will use flyers, signs, and business cards. How many potential typical customers (not just total people) can you reach each month using the types listed above? We will reach 50 people per month. Once you ve reached your typical customer, how many will actually buy from you? We will convert at least 20 of these. For each of the three, what do you think the estimated cost will be? Marketing will cost $400 per month. For each cost estimate, is this a one-time expense up front or a recurring monthly charge? This is a recurring monthly cost. How will you collect customer reviews? I will use customer surveys. Aback Dump Trucks 8

13 START-UP COST Owner's name Company name Industry Aback Freight Lines Oil and Gas Start-up Costs Year 1 Assumption 4 - Total Uses Paid or Non-Depreciable Costs contributed in 1 marketing, business cards, fliers 200 cell phone purchase 400 car/truck down payment, if leased permits 2,600 supplies, office & misc. 200 Website 1,200 Misc. 500 Cash needed for start-up expenses 5,100 Depreciable Costs Paid or contributed in 1 Equipment Financing (Additional to amount paid) Depreciable Assets company car, truck or van 30,000 30,000 company trailer 15,000 15,000 computer, printer, fax 2,000 2, building/office deposit N/A N/A beginning cash balance 18,400 N/A N/A Cash needed for start-up assets 65,400-47, assumed life (months) 783 monthly depreciation Total start up cost 70,500 Assumption 5 - Total Sources Cash owner will contribute to the company 65,500 93% Value of owner's assets contributed to company 0% Vehicle loan and other equipment debt (see note 7 for financing) - 0% Unsecured debt, if applicable (for example Kiva loan) 5,000 7% Outside equity investment, if applicable 0% Total start up cost, total sources 70, %

14 dba Aback Freight Lines EOU, Financing, and Payroll Assumptions Year 1 Assumption 6 - Revenue Model (Economics of One Unit) Product 1 Product 2 Product 3 Product name Product description Hauling Material Hauling Sand/Gravel/Dirt Price per unit % 0% 0% Cost of one unit hours rate hours rate hours rate Non-owner payroll exp. - 0% - 0% - 0% Non-owner payroll tax 9.0% - 0% - 0% - 0% cost 1 description Fuel % 0% 0% cost 2 description Maitanence % 0% 0% cost 3 description 0% 0% 0% cost 4 description 0% 0% 0% Total variable costs % - 0% - 0% Income statement gross profit per unit % - 0% - 0% hours rate hours rate hours rate Owner's labor charge - 0% - 0% - 0% Pro forma gross profit % - 0% - 0% Start-up Total Year Hauling Material sold sold - sold - total revenue $ 16,000 $ 16,000 $ 16,000 $ 16,000 $ 16,000 $ 16,000 $ 16,000 $ 16,000 $ 16,000 $ 16,000 $ 16,000 $ 176,000 total cost of sales $ 5,380 $ 5,380 $ 5,380 $ 5,380 $ 5,380 $ 5,380 $ 5,380 $ 5,380 $ 5,380 $ 5,380 $ 5,380 $ 59,180 total income statement gross profit (excludes owner labor) $ 10,620 $ 10,620 $ 10,620 $ 10,620 $ 10,620 $ 10,620 $ 10,620 $ 10,620 $ 10,620 $ 10,620 $ 10,620 $ 116,820 Owner's labor hours (time spent directly related to sales) Assumption 7 - Financing Total Year Equipment financing, see Start-up Costs sheet amortization schedule Amount borrowed $ - principal, beginning Interest rate interest expense Loan term (months) principal payment ly payment - principal, ending Start-up financing, see Start-up Costs sheet Amount borrowed $ 5,000 principal, beginning 5,000 4,792 4,583 4,375 4,167 3,958 3,750 3,542 3,333 3,125 2,917 Interest rate 0.0% interest expense Payback period (months) 24 principal payment (208) (208) (208) (208) (208) (208) (208) (208) (208) (208) (208) (2,292) Grace period (months) principal, ending 4,792 4,583 4,375 4,167 3,958 3,750 3,542 3,333 3,125 2,917 2,708 ly payment $ 208 Assumption 8 - Payroll, nondirect Total Year # of employees avg hours each employee(s) worked per month, not in EOU above average per hour wage salary expense, exclduing payroll taxes Assumption 9 - Equipment Purchases, after start-up Description Total Year FINANCIALS

15 dba Aback Freight Lines Projected Income and Cash Flow Statements Year 1 Assumptions Start-up First Year % of Total Revenue Revenue 2 Hauling Material 6-16,000 16,000 16,000 16,000 16,000 16,000 16,000 16,000 16,000 16,000 16, , % line not used % line not used % Total revenue - 16,000 16,000 16,000 16,000 16,000 16,000 16,000 16,000 16,000 16,000 16, , % Cost of Goods Sold 2 Hauling Material 6-5,380 5,380 5,380 5,380 5,380 5,380 5,380 5,380 5,380 5,380 5,380 59,180 34% line not used % line not used % Total COGS - 5,380 5,380 5,380 5,380 5,380 5,380 5,380 5,380 5,380 5,380 5,380 59,180 34% Gross profit - 10,620 10,620 10,620 10,620 10,620 10,620 10,620 10,620 10,620 10,620 10, ,820 66% Expenses 2 Auto or truck lease - - 0% Depreciation ,617 5% Gasoline & fuels ,400 3% Insurance - bonding ,500 3% Insurance - vehicle - - 0% Interest - equip & start up % Marketing ,500 2% Office - rent - - 0% Office - insurance - - 0% Office - telephone - - 0% Office - utilities - - 0% Payroll - not owner and not in % COGS Payroll taxes (9%) 6 & % Permits 2, ,987 3% Supplies % Tax service - - 0% Telephone - cellular ,500 1% Start-up expenses 1, ,700 1% Tires/maitanance - 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 11,000 6% - - 0% - - 0% - - 0% - - 0% - - 0% - - 0% Total expenses 5,100 3,300 3,300 3,300 3,300 3,300 3,300 3,300 3,300 3,300 3,300 3,300 41,404 24% Taxable profit (loss) 1 (5,100) 7,320 7,320 7,320 7,320 7,320 7,320 7,320 7,320 7,320 7,320 7,320 75,416 43% Tax (expense) benefit 1 (2,385) (5,490) (5,490) (5,490) (18,854) -11% Owner's withdrawals 1 - (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (55,000) -31% Net profit (loss) (5,100) 2,320 (65) 2,320 2,320 (3,170) 2,320 2,320 (3,170) 2,320 2,320 (3,170) 1,562 1% Depreciation ,617 Equipment purchases 3 (47,000) (47,000) Principle, equipment loan Repay debt financing 7 5,000 (208) (208) (208) (208) (208) (208) (208) (208) (208) (208) (208) 2,708 Owner contribution 3 65, ,500 Equity investor Net cash flow 18,400 2, ,895 2,895 (2,595) 2,895 2,895 (2,595) 2,895 2,895 (2,595) 31,387 Cash, period start - 18,400 21,295 21,805 24,699 27,594 24,999 27,893 30,788 28,193 31,088 33,982 - Cash, period end 18,400 21,295 21,805 24,699 27,594 24,999 27,893 30,788 28,193 31,088 33,982 31,387 31,387 The accompanying assumptions are an integral part of this financial statement.