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)

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3 A luxury experience to casinos and more Business Plan December 2018 Owner & Founder

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

5 EXECUTIVE SUMMARY Opportunity Purpose Solution To establish a relationships with our customers and give them a service and experience that meets their needs. The opportunity of providing a service to customers in need who would like to travel to casinos from northern Mexico. Providing a transportation service that brings customers from northern Mexico to casinos. Customers Differentiators Extras Our customers are 21 and older in need of a ride to casinos. We provide transportation to international customers who are in need of a ride to casinos. Our website allows our customers to see upcoming events and our relationships with customers through social media networks to keep them informed. Marketing Start-up Costs Financials & Extras I will reach my customers through referrals from repeat customers, social media networks, signs, TV, radio, and flyers. Owner Inv. - (Cash) $ - Owner Investment (Equipment) $ - Vehicle/equipment Loan $ 150,000 Unsecured Debt/Loan $ 5,000 Equity Investment $ - Total start up costs: $ 155,000 Sales: $ 422, % COGS 190,000 45% Gross profit 232,300 55% Overhead 70,200 17% Pretax income 162,000 38% Tax expense 40,500 10% Owner withdrawals 50,000 12% Net income $ 71,500 17% Personal Fit We offer a luxury class experience to casinos and provide a high quality service at an economical price. Our service operates at a professional level and we aim to provide and serve our customer s needs.

6 PERSONAL FIT As the proud owner and founder of, Jorge will be providing a luxury experience to casino visitors. Jorge brings the skills and expertise he learned at PEP to this venture and he will instill the 10 Driving Values system at his workplace. He has worked in the casino travel industry for seven years. Jorge has been the general manager of for 10 years. While at, he has improved the work environment by bringing a Servant- Leader mentality to it. The company has performed at a top level of professionalism. Our goal is to have and maintain a 100% repeat customer agenda. We aim to get three referrals from every customer. We are not only providing a service but providing an experience. OPPORTUNITY Explanation: The opportunity of providing a service to customers who would like to travel to casinos. Can I solve the problem given my skills and personality? By being a people person along with being able to provide this service, yes I can. Is the customer looking for a more holistic solution than his or her immediate complaint? The lack of bus services can solve this problem. Do I need to do all of the work myself or can I hire others to help me and still maintain quality? I will hire others to help me bring to life this high quality service. Is there growth potential to expand my business, or is this a dying market? I believe this market is growing at a rapid rate and my business will prosper and expand. How soon can I get my business up and running? This business is currently running. I just need to revamp and set it on its proper course. Is this something that will take a lot of cash to get started or is it more of a question of hustle? I will hustle and push to achieve a successful business. Is this something I would be proud to share with my family and parole officer? Yes, I will be very proud to share my idea with my family and parole officer. Is the opportunity (Activity and Start Date) consistent with potential parole restrictions? It should be no problem and will be consistent with my parole restrictions. Would my business start as a part-time venture or need to be full time? This will be a full-time venture. 2

7 SOLUTION Explanation: Open a full time venture and deliver a luxury experience people wanting to travel to casinos from northern Mexico. Is what I am offering filling the customer s real need? Yes, the demand for transportation to casinos is high What are the benefits (not features) that I am providing? I am providing an economic luxury transportation service to casinos. Why can I do this better than another business (competitor)? Our buses are of luxurious and the service we will provide is of highest quality. How will I deliver this better idea to my customers? We will utilize newspaper ads also by aiming to get referrals from repeat customers Is my delivery (retail store, home service, etc.) consistent with how I will produce the service (one-day delivery, hand-made products, etc.)? We are a transportation service focusing on the casino industry. Is my solution consistent with my passion for selling? I believe so I am not only selling a service but an transportation experience Is the price of my solution equal to or less than the customer s pain? It is a very economically priced service. Is the approximate cost of my solution lower than the price? We price our service to be the most economic means to and for casinos. Do I need a fixed location (Storefront) or is this a mobile business? I have a fixed location but plan to install a few more Do I offer a guaranty or return policy? I guarantee a service that will bring return customers CUSTOMERS Explanation: Any person who wants to have a comfortable and luxurious ride to and from any entertainment venue. Demographics: Will my service have different appeal to men versus women? No. It will appeal to all customers who need transportation to casinos. What is my ideal customer s age (children, young adult, middle aged, mature)? Twenty one and up. Any age as long as they need transportation and are willing to go traveling. Does my customer need to be married, single or does it matter? It doesn t matter because we will provide a service, regardless of marital status. Do language or ethnicity differences improve or limit my ability to sell to my ideal customer? No, if anything it will improve since my service will be international. 3

8 What aspect of my ideal customer am I appealing to (outdoors person, health conscious, nerd, their personal image, environmental concerns, recreation, etc.)? Recreation. It will provide leisure trips to casinos. Income: Does my customer need a certain income (rich, middle class, poor)? No, as long as they are willing and able to travel to casinos. Does my customer need to own specific assets (car, house, boat)? Negative. As long as they need a ride we can provide that service. Location: Where will I sell to my customers (their home, their workplace, on the street, online, my store, an event like trades day)? Online and at my location, also we will promote and sell through newspapers, flyers, signs, radio and social media. Do I go to my customer (home service) or does my customer come to me? My customer will come to me so I can provide our service. What neighborhood will my ideal customer live/work in (River Oaks/Highland park, a suburb, or small rural community)? Most of our customers are retired and live in gated communities. How close are my customers geographically located (live close to each other or spread all over the city)? Time is money. They are spread all over the city but they are dependable and very reliable. How easily can I find this customer (one at a time or they will provide referrals)? They all refer others but our customer base has and always will be ready to travel and go on events. Other: Can I reach these individuals as a group or do I need to find and sell to them individually? Most are in groups but through advertising individual customers will also commit. Once I sell to a customer, what is the likelihood that they will buy from me again? We aim to have 100% repeat customers. Our service will speak for itself and reassure that. Am I selling to a wholesaler, retailer or does it matter? We are retailers who sell to individual customers. What industry is my customer in? In the casino transportation industry. What size customer do I want to serve (large/small, single/multiple locations)? Large or small we can meet their needs. Will my customer require special insurance (construction bonding, liability insurance)? Liability insurance is provided and required. Does my customer require 24/7 service? Most of our trips are on the weekends from Fridays to Sunday. Do I have the capacity to meet the customer s demands? 4

9 Yes, we can meet the demand of our customers and provide the service they need. Will the size of a customer allow me to develop other clients or will I be hostage to one company? I can and will develop and deliver to many customers. I have the supply of buses to meet their demands. 5

10 DIFFERENTIATORS My Competitors My customers driving themselves Direct or Indirect Direct Promotion Billboards, TV, Radio Pegasso Direct Billboards, Flyers, Radio, TV Price Their Advantages $25 They can drive there themselves Their Disadvantages Having to drive themselves My Differentiators I have professional drivers and deliver great service $25 Location Slow service Cost effectiveness, quality of service Los Amigos Indirect Signs, flyers, TV, radio $20 Branding well - known Small market Cost effectiveness and quality of service Expresso Direct Billboards, TV, radio and newspaper ads Turi-Mex Indirect Newspaper ads, radio, TV $30 Family business Location Professionalism, cost effectiveness and quality of service $25 Well-known Quality of service Cost effectiveness, less charge, personal service 6

11 EXTRAS External Extras: Do you have a connection with a supplier in your industry? I have customers waiting for trips and events. Do you have access to a favorable location for your business? Yes, I have a location established. Are you going to be the first company of your type in your chosen area operations? No, but the service we will provide will be better than others. Internal Extras: Do you have a new or cutting edge concept? I want to design a new website with video clips of buses and details of trips. Will you be able to offer specialized or flexible scheduling that your competitors cannot match initially? Yes, we will operate full time with year-round trips including holidays. Are you an especially charming or personable person? Yes, I am a people person and will handle myself in a professional manner. MARKETING Message: What are three things your company name (with no other information provided) says about your company? - Luxury, excellent service, and a great experience. What is your tagline? We provide a luxury experience to casinos. How does your name and tagline make you different than your competitors? By delivering a service with luxury buses that will accommodate my customers needs. Can your message be effectively conveyed through multiple types of media? I will promote through newspapers, radio, signs, flyers and social media platforms such as Facebook, Twitter and Instagram. Is your message effective across different demographics? We will provide a service to international customers. Is your pricing consistent with the market for similar offerings? Our prices are very consistent as well as our customers. Is your pricing consistent with the degree of personalization? The prices agrees with the service provided. Media: What are three types of media you will use to reach your customers? Newspapers ads, radio ads, and social media. How many potential typical customers (not just total people) can you reach each month using the types listed above? 7

12 A wide range of potential customers can be reached via social media. Once you ve reached your typical customer, how many will actually buy from you? We aim to get at least three referrals and 100% repeat business. For each of the three, what do you think the estimated cost will be? I estimate to spend $500 for advertising. For each cost estimate, is this a one-time expense up front or a recurring monthly charge? This will be a monthly recurring cost. How will you collect customer reviews? We solicit suggest and comments through our company website 8

13 START-UP COST Owner's name Company name Industry Casino Transportation Start-up Costs Year 1 Assumption 4 - Total Uses Paid or Non-Depreciable Costs contributed in 1 marketing, business cards, fliers 350 cell phone purchase 150 car/truck down payment, if leased permits 2,600 supplies, office & misc. 1,500 Website 1,200 Cash needed for start-up expenses 5,800 Depreciable Costs Paid or contributed in 1 Equipment Financing (Additional to amount paid) Depreciable Assets company car, truck or van - company trailer - computer, printer, fax 2,500 2,500 Furniture 5,000 5,000 Maintenance Equipment 2,000 2,000 Busses 150, ,000 building/office deposit N/A N/A beginning cash balance N/A N/A Cash needed for start-up assets 9, , , assumed life (months) 2,658 monthly depreciation Total start up cost 165,300 Assumption 5 - Total Sources Cash owner will contribute to the company 0% Value of owner's assets contributed to company 0% Vehicle loan and other equipment debt (see note 7 for financing) 150,000 97% Unsecured debt, if applicable (for example Kiva loan) 5,000 3% Outside equity investment, if applicable 0% Total start up cost, total sources 155, %

14 FINANCIALS dba 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 Bus Trip 1 round trip bus trip to casinos 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 labor % 0% 0% cost 2 description materials % 0% 0% cost 3 description fuel % 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 Bus Trip sold ,112 sold - sold - total revenue $ 38,400 $ 38,400 $ 38,400 $ 38,400 $ 38,400 $ 38,400 $ 38,400 $ 38,400 $ 38,400 $ 38,400 $ 38,400 $ 422,400 total cost of sales $ 17,280 $ 17,280 $ 17,280 $ 17,280 $ 17,280 $ 17,280 $ 17,280 $ 17,280 $ 17,280 $ 17,280 $ 17,280 $ 190,080 total income statement gross profit (excludes owner labor) $ 21,120 $ 21,120 $ 21,120 $ 21,120 $ 21,120 $ 21,120 $ 21,120 $ 21,120 $ 21,120 $ 21,120 $ 21,120 $ 232,320 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 $ 150,000 principal, beginning 150, , , , , , , , , , ,212 Interest rate 8.0% interest expense 1, ,499 Loan term (months) 84 principal payment (1,338) (1,347) (1,356) (1,365) (1,374) (1,383) (1,392) (1,402) (1,411) (1,420) (1,430) (15,218) ly payment 2,338 principal, ending 148, , , , , , , , , , ,782 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

15 dba Projected Income and Cash Flow Statements Year 1 Assumptions Start-up First Year % of Total Revenue Revenue 2 Bus Trip 6-38,400 38,400 38,400 38,400 38,400 38,400 38,400 38,400 38,400 38,400 38, , % line not used % line not used % Total revenue - 38,400 38,400 38,400 38,400 38,400 38,400 38,400 38,400 38,400 38,400 38, , % Cost of Goods Sold 2 Bus Trip 6-17,280 17,280 17,280 17,280 17,280 17,280 17,280 17,280 17,280 17,280 17, ,080 45% line not used % line not used % Total COGS - 17,280 17,280 17,280 17,280 17,280 17,280 17,280 17,280 17,280 17,280 17, ,080 45% Gross profit - 21,120 21,120 21,120 21,120 21,120 21,120 21,120 21,120 21,120 21,120 21, ,320 55% Expenses 2 Auto or truck lease - - 0% Depreciation 3-2,658 2,658 2,658 2,658 2,658 2,658 2,658 2,658 2,658 2,658 2,658 29,242 7% Gasoline & fuels ,300 1% Insurance - bonding ,200 1% Insurance - vehicle ,400 1% Interest - equip & start up 7-1, ,499 2% Marketing ,750 1% Office - rent - - 0% Office - insurance - - 0% Office - telephone - - 0% Office - utilities ,200 1% Payroll - not owner and not in % COGS Payroll taxes (9%) 6 & % Permits 2,600 2,600 1% Supplies 1, ,900 1% Tax service - 1,500 1,500 0% Telephone - cellular ,800 0% Start-up expenses 1, ,200 0% Safety % - - 0% - - 0% - - 0% - - 0% - - 0% - - 0% Total expenses 5,800 5,708 6,399 5,690 5,681 5,672 5,663 5,654 5,645 5,635 5,626 7,116 70,291 17% Taxable profit (loss) 1 (5,800) 15,412 14,721 15,430 15,439 15,448 15,457 15,466 15,475 15,485 15,494 14, ,029 38% Tax (expense) benefit 1 (6,083) (11,579) (11,600) (11,246) (40,507) -10% Owner's withdrawals 1 - (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (5,000) (50,000) -12% Net profit (loss) (5,800) 15,412 3,638 10,430 10,439 (1,131) 10,457 10,466 (1,124) 10,485 10,494 (2,242) 71,522 17% Depreciation 3-2,658 2,658 2,658 2,658 2,658 2,658 2,658 2,658 2,658 2,658 2,658 29,242 Equipment purchases 3 (159,500) (159,500) Principle, equipment loan 7 150,000 (1,338) (1,347) (1,356) (1,365) (1,374) (1,383) (1,392) (1,402) (1,411) (1,420) (1,430) 134,782 Repay debt financing 7 5,000 (208) (208) (208) (208) (208) (208) (208) (208) (208) (208) (208) 2,708 Owner contribution Equity investor Net cash flow (10,300) 16,524 4,741 11,524 11,524 (55) 11,524 11,524 (76) 11,524 11,524 (1,222) 78,754 Cash, period start - (10,300) 6,224 10,964 22,488 34,012 33,957 45,480 57,004 56,928 68,452 79,976 - Cash, period end (10,300) 6,224 10,964 22,488 34,012 33,957 45,480 57,004 56,928 68,452 79,976 78,754 78,754 The accompanying assumptions are an integral part of this financial statement.