Start-up Funding | |
Start-up Expenses to Fund | $575,000 |
Start-up Assets to Fund | $425,000 |
Total Funding Required | $1,000,000 |
Assets | |
Non-cash Assets from Start-up | $200,000 |
Cash Requirements from Start-up | $225,000 |
Additional Cash Raised | $0 |
Cash Balance on Starting Date | $225,000 |
Total Assets | $425,000 |
Liabilities and Capital | |
Liabilities | |
Current Borrowing | $1,000,000 |
Long-term Liabilities | $0 |
Accounts Payable (Outstanding Bills) | $0 |
Other Current Liabilities (interest-free) | $0 |
Total Liabilities | $1,000,000 |
Capital | |
Planned Investment | |
Investor 1 | $0 |
Investor 2 | $0 |
Other | $0 |
Additional Investment Requirement | $0 |
Total Planned Investment | $0 |
Loss at Start-up (Start-up Expenses) | ($575,000) |
Total Capital | ($575,000) |
Total Capital and Liabilities | $425,000 |
Total Funding | $1,000,000 |
We have two locations, one in Kahului, Maui and the other in Hilo, Hawai’i. The two offices are presently being leased by Servco Pacific, Inc., and we will rent from them on a month-to-month basis until we are able to relocate to more suitable facilities. On Kauai, we have a sub-contractor agreement with Kauai Office Equipment to handle installations and service.
IMH will acquire an existing operation whose primary business has been the sale and service of business appliances (copiers, facsimiles, printers, etc.) and has operated as a part of the office equipment industry. We will build from this base to transform the business into a value-added provider of the emerging services and technologies of the new Information Industry. Following the lead of Canon, USA and other manufacturers which we represent, we will approach the marketplace from a total systems solutions viewpoint.
This new paradigm will begin with an analysis of the client’s existing and planned business processes, and will provide total workflow solutions utilizing multifunctional imaging platforms and information distribution systems. These systems will be backed by professional and reliable technical service and proactive customer service. By forming strategic alliances with local Information Industry Value-Added Resellers, we will be able to offer turnkey Local Area Network (LAN) systems and the ability to retrofit existing LAN and peer-to-peer systems.
Copies of our product and sales literature are attached as appendices. Of course, one of our first tasks will be to change the message of our literature to make sure we are selling the company, rather than the product.
IMH will market and sell brand name business information distribution systems and hardware, technical service and support for these products, and the consumable supplies used by these systems. We will be a single-source provider for business information and imaging products and services.
After researching our various manufacturer’s offerings and evaluating our core competencies, we will focus our marketing and sales efforts around the digital products offered by Canon USA and eCopy, Inc. We will supplement this product line with Lexmark and Hewlett Packard printer products. As we continue to transition the company into the digital marketplace, we will form alliances with additional IT manufacturers and suppliers who can round out our product and services line.
Hardware product offerings will include:
Software offerings will include:
Service Products include:
Professional Services include:
The only way we can hope to differentiate well is to define the vision of the company to be an information technology ally to our clients. We will not be able to compete in any effective way with the large mainland-based office equipment companies by selling boxes or products as appliances. We need to offer a real alliance to our local customers.
Unfortunately, we cannot sell the products at a higher price just because we offer services; the market has shown that it will not support that concept. We have to also sell the service and consumable supplies and charge for them separately. This monthly recurring revenue is the foundation of our financial stability.
New technology has changed almost everything about the traditional office equipment (copier) industry, and for all practical purposes it no longer exists. The new Information Industry has emerged because of the technology of convergence. The primary driver of convergence of different forms of information is technological change, specifically the rapid diffusion of digital technology into an ever-wider array of information businesses. Beyond digitization, dramatic changes in computing and telecommunications industries (mainly in faster microprocessors and increasing bandwidth) are also driving convergence.
IMH will make convergence the theme of its vision, planning, and marketing strategies. We will move into the new Information Industry’s technology with the aim of bringing the most efficient workflow solutions to our clients while providing value-added customer support and service, and earning a reasonable profit in the process.
Our strategy hinges on providing unparalleled service and support, which is critical to setting us apart from the competition. We need to differentiate on service and support in order to become true partners with our clients. Our service offers will include:
Beginning at start up, we will explore and research new information technologies for inclusion in our product offerings. The products which we choose will be in line with our vision to transition the company from being an appliance seller, to being a provider of total information management solutions. These convergent information products will include:
We have an established relationship with our manufacturers and suppliers, and will be able to take advantage of all discounts and promotions in order to keep our margins at roughly 49% throughout the operation. We will also implement and employ “just-in-time” inventory strategies for hardware, supplies, and service parts orders to further strengthen our margins.
As we continue to grow the business, we will evaluate other IT industry manufacturers and product lines to strengthen our offerings with a view primarily to quality and margin advantages.
IMH will focus on local markets, including small offices and home offices (1-9 employees), medium to large businesses (10-99 employees), corporate Hawai’i (multiple locations or 100+ employees), and local government offices.
Our market segmentation scheme is fairly straightforward, and focuses on all Neighbor Island businesses. The information contained in our customer analysis table is taken directly from the 2000 US Census and government directories, and clearly shows that our largest market potential is the small office and home office (SOHO) segment. This segment is largely overlooked by most of our competitors because of its “low end” buying habits, and a reluctance to compete with the major retail chain box movers. We will target the SOHO market segment with value-added and affordable business solutions customized to its unique needs, and offer the same quality of service and support as are afforded the larger businesses.
The next largest market segment is medium to large businesses, and is the arena where we now focus most of our sales efforts. We will continue to target this segment, but with a different approach than our predecessors. The strategy used by former management has been to bring in selected products, and then attempt to find a buyer. This resulted in inventory overstock, and obsolescence. We will work with the medium to large businesses to determine their needs, and design customized solutions before ordering the required systems (JIT inventory strategy). This segment will remain an extremely important part of our marketing mix, and contains a large portion of our current clients. A majority of our systems upgrade opportunities and repeat business will come from this market segment initially.
Although the Corporate Hawai’i market segment is the smallest in numbers, it has the potential to provide a significant share of our revenues and growth (the 80/20 rule). We have a scattering of current clients in the Corporate Hawai’i segment, but we need to do a better job of penetrating this lucrative end of the market. We will accomplish this by offering professional services to include workflow and network design, MIS support, and other value-added support benefits such as “uptime guarantees.” We will develop long-term relationships within this segment, and earn their business.
The local government market segment is unique in that we act primarily as a “middle man” for our manufacturers due to GSA price schedules and other national government-only programs. This segment is fiercely competitive, very price-focused, and buying decisions are often influenced by “who you know,” as well as price. We are fortunate in that we have long-established relationships within the County and State government agencies, and have many loyal clients in this segment. We will increase our share of this market segment by offering the same value-added service and support benefits that we bring to our commercial clients.
Market Analysis | |||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |||
Potential Customers | Growth | CAGR | |||||
SOHO | 4% | 6,800 | 7,072 | 7,355 | 7,649 | 7,955 | 4.00% |
Medium/Large Business | 4% | 2,100 | 2,184 | 2,271 | 2,362 | 2,456 | 3.99% |
Corporate Hawaii | 3% | 140 | 144 | 148 | 152 | 157 | 2.91% |
Government Offices | 2% | 1,225 | 1,243 | 1,262 | 1,281 | 1,300 | 1.50% |
Total | 3.69% | 10,265 | 10,643 | 11,036 | 11,444 | 11,868 | 3.69% |
Developing a market strategy is a departure from the way the company has been managed in the past. We will change the paradigm of being a product- and price-focused sales organization, to that of becoming a customer- and market-focused organization, with all departments sharing responsibility for customer satisfaction. We will accomplish this paradigm shift through the implementation of a balanced scorecard philosophy of management, with special attention to employee learning and growth.
As mentioned previously our market segmentation strategy is straightforward, and addresses all components of the Neighbor Island business community. Planning and implementing specific strategies for each of the four identified segments will be an on-going process, and we will consult with marketing specialists, and our manufacturers, to further refine these efforts as we develop our marketing plan.
That is the primary reason that IMH has chosen Canon USA as its preferred manufacturer. Canon has led the way in the industry with it’s digital technology innovations, and its ability to bring both the product and the concept to the marketplace. We will follow Canon’s lead and bring this efficient, productivity-enhancing technology to Neighbor Island businesses.
As computer prices continue to fall, unit sales increase. The published market research on sales of personal computers is astounding, as the United States market alone is absorbing more than 30 million units per year, and sales are growing at more than 20 percent per year. We could quote Dataquest, Infocorp, IDC, or others; it doesn’t matter, they all agree on high growth of CPU sales.
This rapid growth rate holds true for productivity systems which connect to the computers being sold. The stand-alone analog systems and appliances which abound in the business marketplace today, will be replaced by connected digital convergence systems in the coming months and years. IMH will position itself to be a value-added provider of this rapidly emerging technology for new businesses, while continuing to maintain and upgrade our current analog customer base.
All businesses have in common a need to be continuously productive, and they rely on their service providers and vendors to sustain their productivity. Effectively filling this need requires that the vendor bring to the table sound planning, quality products, reliable service, and a true partnership and support relationship.
Specific business needs include the ability to gather, compile, analyze, and distribute information in various media formats. This is where IMH’s strengths will be most beneficial to our clients, both big and small. Anyone can sell the “box” at an attractive price, but only a true value-added provider can offer the peace-of-mind that comes from a customer-focused approach to the relationship.
Primarily due to geographic isolation and smaller populations, the Neighbor Island business community has an additional common need of being able to rely on other locally-based vendors and suppliers for quick, reliable, customer service and support. Having to call someone on Oahu, or the mainland, to place a service call, or to order supplies, or get an answer to a simple billing question, is both an irritant and a hindrance to most Neighbor Island-based businesses. Our primary goal is to fill this need by bringing true pro-active, and total, customer service to the Neighbor Island business community, and to gain their confidence and loyalty. This will become one of our underlying strengths.
IMH is a part of the Information Industry, and specializes in providing information management systems and technology for business processes. We envision that a converged information industry operating within the context of an advanced information infrastructure will be a huge boost for U.S. businesses. Several Washington think tanks estimate that it could spur more than $300 billion annually in new sales and increase worker productivity by 20 to 40 percent.
At the present time, an estimated two-thirds of all American jobs are information related, and that number will increase as the shift from manufacturing to service industries continues. The convergence of information industries will continue because the technological and business imperatives are compelling. If one company does not see the possibilities, another will.
Business decision makers and finance managers understand the concept and value of service and support, and are much more likely to pay for it when the offering is clearly stated.
There is no doubt that we compete more against the box pushers than against other service providers. We need to effectively compete against the idea that businesses should buy information platforms as plug-in appliances that don’t need ongoing service, support, and training.
Our research and experience has indicated that our target market segments think about price, but would buy based on quality service if the offering were properly presented. They think about price because that is what is traditionally presented to them first. We have very good indications that many would rather pay 10-20% more for a relationship with a long-term vendor providing back-up and quality service and support. They end up in the box-pusher channels because they are not aware of the alternatives.
Availability is also very important. The business decision makers tend to want immediate, local solutions to problems.
Medium to large business segment buyers are accustomed to buying from vendors who visit their offices. They expect the copy machine vendors, office products vendors, and office furniture vendors, as well as the local graphic artists, freelance writers, or whomever, to visit their office to make their sales.
Unfortunately our SOHO target segment buyers may not expect to buy from us. Many of them turn immediately to the retail superstores (office equipment, office supplies, and electronics), the Web, and mail order to look for the best price, without realizing that there is a better option for them for only a little bit more. We will overcome this hurdle through innovative service offerings, and targeted marketing.
In our higher-end targeted segments (medium to large businesses, corporate Hawai’i, and government offices), the primary competitors are Xerox and Lanier. The secondary “low end” competitors on the Neighbor Islands are Maui Office Machines and Business Equipment on Maui, and Electronics Hawai’i and Stationers on the Big Island. Our overall competitive strategy in these segments will be Canon’s superior technology, and superior value-added service and support.
In our SOHO target segment, the primary competitors are the superstores: Office Max, Office Depot, Sears, and to some extent Costco, Hopaco, and the Web. While these outlets can offer lower prices, they offer no (or very little) aftermarket service or support. That is our competitive advantage in this segment, and will differentiate us from these “box movers.”
The traditional office equipment (copier) industry has been dominated by only a few major manufacturers: Xerox, Canon, Oce, and Ricoh (and its OEM products – Lanier, Savin, and Gestetner); and then come the low-end players: Sharp, Toshiba, and Minolta. With the exception of Xerox, which maintains its own sales force, the other manufacturers distribute and sell mainly through authorized dealers.
The rapidly emerging Information Industry’s digital convergence products will most likely be dominated by the same participants as described above. While Xerox has been a past leader in the manufacture and sales of analog products, Canon has emerged as both an innovator, and the leader, in the new Information Industry with their ImageRunner digital products and Image Platform information distribution systems. Canon is also (and has been for many years) the front runner in color repro-graphic systems, and holds the most patents of any manufacturer in the industry.
We must differentiate ourselves from the box pushers. We need to establish our business offering as a clear and viable alternative for our target markets, to the price oriented sales pitch to which they are accustomed.
The industry’s cheese has been moved. In order to shift to a more contemporary paradigm, our marketing and sales efforts will need:
Our competitive edge is our positioning as a strategic ally with our clients, who are clients more than customers. By building a business based on long-standing relationships with satisfied clients, we simultaneously build defenses against competition. The longer the relationship stands, the more we help our clients understand what we offer them and why they should both stay with IMH, and refer us to other businesses. In close-knit communities like the Neighbor Islands, reputation is extremely important, and word-of-mouth advertising is invaluable.
Our main strategy will be placing emphasis on service and support, and our main tactics are networking expertise, systems training, and implementing a customer relationship management system (CRM) from e-automate. Our specific programs for networking include mailers and internal training. Specific programs for end user training include direct mail promotion, and on-site customer programs. Implementing the CRM software and training will be coordinated with the e-automate Corporation.
Our second strategy is emphasizing relationships. The tactics are marketing the company (instead of the products), more regular contacts with the customer, and increasing sales per customer. Programs for marketing the company include new sales literature, and direct mail. Programs for more regular contacts include call-backs after installation, direct mail, and sales management. Programs for increasing sales per customer include upgrade mailings and sales training.
IMH offers its clients peace-of-mind by being a vendor who acts as a strategic ally, and delivers quality products backed by premium service and support, at a premium price.
We will sell the company and its ability to act as an ally. We will sell IMH, and the reputation of the industry-leading manufacturers it represents.
We will sell our service and support. The hardware is like the razor, and the support, service, software, and training, are the razor blades. We need to serve our customers with total solutions, and not just product features. The products are a means to arriving at end solutions.
The Yearly Total Sales chart summarizes our conservative sales forecast. We expect sales to increase from $3.1 million in the first year to more than $4 million in the third year of this plan.
The important elements of the sales forecast are shown in the following Chart, and Table 5.4.1. Non-hardware sales increase to almost $2 million total in the third year, or 47% of total sales.
Sales Forecast | |||
Year 1 | Year 2 | Year 3 | |
Sales | |||
Hardware – Image Platforms | $1,092,956 | $1,256,899 | $1,445,434 |
Hardware – Printers | $69,615 | $80,057 | $92,066 |
Hardware – Facsimiles | $142,711 | $164,117 | $188,735 |
Hardware – Misc (TW, Shrd) | $45,250 | $52,037 | $59,843 |
Professional Services | $29,808 | $34,279 | $39,420 |
Government (Comp) | $87,019 | $100,072 | $115,082 |
Supplies (Toner/Paper) | $501,228 | $576,412 | $662,874 |
Service – Agreements/Repairs | $946,764 | $1,088,779 | $1,252,095 |
Equipment Rentals | $243,653 | $280,200 | $322,230 |
Other | $31,327 | $36,026 | $41,430 |
Total Sales | $3,190,329 | $3,668,878 | $4,219,209 |
Direct Cost of Sales | Year 1 | Year 2 | Year 3 |
Hardware – Image Platforms | $677,632 | $772,501 | $880,651 |
Hardware – Printers | $45,250 | $51,585 | $58,807 |
Hardware – Facsimiles | $88,481 | $100,868 | $114,989 |
Hardware – Misc (TW, Shrd) | $31,675 | $36,109 | $41,165 |
Professional Services | $14,904 | $16,990 | $19,369 |
Government (Comp) | $30,457 | $34,720 | $39,581 |
Supplies (Toner/Paper) | $225,553 | $257,130 | $293,128 |
Service – Agreements/Repairs | $378,706 | $431,724 | $492,166 |
Equipment Rentals | $134,009 | $152,770 | $174,158 |
Other | $7,832 | $8,928 | $10,178 |
Subtotal Direct Cost of Sales | $1,634,497 | $1,863,326 | $2,124,192 |
The following table lists important program milestones, with dates and managers in charge, and budgets for each. The milestone schedule indicates our emphasis on planning for implementation. The most important programs are the sales and marketing programs listed in detail in the previous topics.
Milestones | |||||
Milestone | Start Date | End Date | Budget | Manager | Department |
SIOT (NI) Valuation | 5/1/2001 | 5/31/2001 | $0 | BH | Admin |
Complete Business Plan | 5/14/2001 | 6/22/2001 | $200 | BH | Admin |
Submit Letter of Intent | 6/1/2001 | 6/15/2001 | $0 | BH | Admin |
Choose New Company Name | 6/15/2001 | 7/31/2001 | $0 | All | All |
Secure Startup Funding | 6/15/2001 | 7/31/2001 | $0 | BH/All | All |
Retain Attorney/CPA | 6/15/2001 | 7/31/2001 | $10,000 | BH | Marketing |
Negotiate Purchase Agreement | 6/18/2001 | 8/15/2001 | $0 | BH/All | Admin |
Set Up ESOT/ESOP | 6/30/2001 | 8/31/2001 | $12,500 | BH/LW | All |
Set Up New Corporation | 6/30/2001 | 8/31/2001 | $12,500 | BH/LW | All |
Solicit Board Members | 6/30/2001 | 8/31/2001 | $0 | BH | All |
HR Roll-Over Plan (SPI to IMH) | 7/1/2001 | 8/31/2001 | $0 | BH/LW | Admin |
Purchase e-Automate Software | 8/1/2001 | 8/31/2001 | $20,000 | BH/LW | Admin |
A/P & A/R into e-Automate | 8/1/2001 | 8/31/2001 | $0 | LW | Admin |
Business Licenses/Permits | 8/1/2001 | 8/31/2001 | $500 | BH/LW | Admin |
Customers into e-Automate | 8/1/2001 | 8/31/2001 | $0 | JM/BK | Sales |
Inventory into e-Automate | 8/1/2001 | 8/31/2001 | $0 | LW/JA/EO | Service |
Letter To Vendors/Customers | 8/1/2001 | 8/31/2001 | $0 | LW | Admin |
New Stationary/Brochures | 8/1/2001 | 8/31/2001 | $2,500 | LW | Admin |
Obtain Insurance | 8/1/2001 | 8/31/2001 | $25,000 | BH/LW | Admin |
Switch Utilities To IMH | 8/1/2001 | 8/31/2001 | $1,000 | LW | Admin |
Web Site Development | 8/1/2001 | 8/31/2001 | $10,000 | BH | Admin |
Complete Marketing Plan | 8/1/2001 | 8/31/2001 | $2,500 | All | Sales |
IMH Operations – Day 1 | 9/3/2001 | 9/3/2001 | $0 | All | All |
Bd. of Dir. Mtg. (First) | 9/4/2001 | 9/7/2001 | $1,000 | All | All |
All Company – Kick Off Mtg. | 9/4/2001 | 9/7/2001 | $750 | All | All |
Sales Strategies & Programs | 9/4/2001 | 9/30/2001 | $2,500 | JM | Sales |
Marketing Strategy & Programs | 9/4/2001 | 9/30/2001 | $3,500 | BK | Sales |
First Quarter BP Review | 12/10/2001 | 12/14/2001 | $0 | All | All |
Headcount Review | 12/10/2001 | 12/14/2001 | $0 | BH/EO/JA | Sales/Svc |
Bd. of Dir. Mtg. (Qtrly) | 12/10/2001 | 12/14/2001 | $1,000 | All | All |
Cost IT Training Sources | 3/4/2002 | 3/8/2002 | $0 | BH/EO/JA/BK | Sales/Svc |
Second Quarter BP/MP Review | 3/4/2002 | 3/8/2002 | $0 | All | All |
Enroll Team in IT Training | 3/18/2002 | 3/29/2002 | $2,500 | All | All |
Third Quarter BP/MP Review | 6/3/2002 | 6/7/2002 | $0 | All | All |
Bd. of Dir. Mtg. (Qtrly) | 6/3/2002 | 6/7/2002 | $1,000 | All | All |
Fourth Quarter BP/MP Review | 9/2/2002 | 9/5/2002 | $0 | All | All |
Bd. of Dir. Mtg. (Qtrly) | 9/2/2002 | 9/5/2002 | $1,000 | All | All |
New 3-Year BP Due | 9/2/2002 | 9/13/2002 | $0 | All | All |
New 3-Year Mktg. Plan Due | 9/2/2002 | 9/13/2002 | $0 | All | All |
Name me | 9/16/2002 | 9/30/2002 | $1,000 | All | All |
Totals | $110,950 |
The marketing strategy is the core of our main strategy:
Specific sales programs will be included in our new Marketing Plan, and will be included in this Business Plan as they are finalized. In general however, our sales programs will be centered around conducting workflow and information distribution analyses, direct mail, and placing an emphasis on the benefits which IMH and its manufacturers will be able to offer its clients through “total care” service and support.
For businesses who want to be sure their information distribution systems are always working reliably, IMH is a vendor and trusted strategic ally who makes certain their systems work, their people are trained, and their down time is minimal. Unlike the product/price oriented vendors, it knows the customer and goes to their site when needed, and offers proactive support, service, training, and installation.
We must charge appropriately for the high-end, high-quality service and support we offer. Our revenue structure has to match our cost structure, so the salaries we pay to assure good service and support must be balanced by the revenue we charge.
We cannot build the service and support revenue into the price of products. The market can’t bear the higher prices and the buyer feels ill-used when they see a similar product priced lower with the competition. Despite the logic behind this, the market doesn’t support this concept.
We will employ the following general promotional strategies for the various market segments:
IMH is first and foremost a direct sales organization, meaning that we must present our services and products directly to the majority of our customers and clients. Having said that, for our planned penetration into the SOHO market, we will need to establish a presence as a Value-Added Reseller (VAR) for certain low-end product lines which don’t carry the margins necessary to sustain the costs of direct sales. We will plan our new locations accordingly.
As we work to complete this Business Plan, we are simultaneously working on our Marketing Plan. As you can see from the milestones table, we anticipate completion of our detailed Marketing Plan by 9/30/01, or one month from start-up. Because we are acquiring an on-going business, the shift to our vision of customer- and market-focused strategies will not happen overnight. We must plan this shift carefully, and implement it judiciously, so as not to disrupt our immediate operations. We have budgeted for, and will utilize, marketing advisors and consultants (including our manufacturers) in the design of our Marketing Plan.
Our alliances with our manufacturers, and especially Canon USA, will be the most pivotal to our success. We will remain a Canon Authorized Dealer, and continue to enjoy all of the benefits of this long-standing relationship.
We will form alliances with other locally-based VARs and computer network providers to enable us to provide complete turnkey packages for our clients. These relationships will be included in our Marketing Plan.
Our management philosophy is simple and is an integral part of our values: doing right things right, the first time (Kina’ole).
IMH will be an employee-owned company and we all share the same vision of providing our clients (who in many cases are friends and neighbors) with the very best in customer service – period. We will encourage personal growth, creativity, and enable individual empowerment to achieve this goal. We will manage the business by setting achievable Balanced Scorecard goals, measuring them, and making mid-stream adjustments as necessary.
Our team includes 15 employees initially, and is organizationally flat. The departmental divisions are sales and marketing, service, and administration. Operational managers include:
The total head count moving over from Servco at the time of the acquisition will be 13. We are adding two former employees at startup to round out our team, for a total startup head count of 15.
There are an additional six positions shown as “vacant” in the Personnel plan. During each quarterly business plan review, we will assess the need to fund these positions to sustain our growth, and more evenly distribute the workload.
Personnel Plan | |||
Year 1 | Year 2 | Year 3 | |
Production Personnel | |||
None planned | $0 | $0 | $0 |
Other | $0 | $0 | $0 |
Subtotal | $0 | $0 | $0 |
Sales and Marketing Personnel | |||
Alan Fukuyama – Sales (Maui) | $38,250 | $40,545 | $42,978 |
Brian Kurlansky – Sales (Kona) | $38,250 | $40,545 | $42,978 |
Jay Moore – Sales (Maui) | $38,250 | $40,545 | $42,978 |
Wilbert Shimabukuro – Sales (Hilo) | $38,250 | $40,545 | $42,978 |
Vacant – Aftermarket Sales (Maui) | $0 | $0 | $0 |
Vacant – Aftermarket Sales (Hilo) | $0 | $0 | $0 |
Subtotal | $153,000 | $162,180 | $171,911 |
General and Administrative Personnel | |||
Bill Harding – General Manager | $57,600 | $61,056 | $64,719 |
Laurie Watson – Admin Manager | $45,600 | $48,336 | $51,236 |
Vacant – Office Manager (Hilo) | $31,200 | $33,072 | $35,056 |
Vacant – Whse & Delivery (Maui) | $0 | $0 | $0 |
Vacant – Whse & Delivery (Hilo) | $0 | $0 | $0 |
Other | $0 | $0 | $0 |
Subtotal | $134,400 | $142,464 | $151,012 |
Other Personnel | |||
Earle Oshiro – Systems Manager (Hilo) | $49,800 | $52,788 | $55,955 |
Joe Alfonsi – Systems Manager (Maui) | $49,800 | $52,788 | $55,955 |
Wane Ogawa – Syst Engineer (Hilo) | $39,600 | $41,976 | $44,495 |
Francis Takahashi – Syst Engineer (Hilo) | $39,600 | $41,976 | $44,495 |
Baron Ganeko – Syst Engineer (Kona) | $39,600 | $41,976 | $44,495 |
Abe Braceros – Sr. Syst Engineer (Maui) | $41,100 | $43,566 | $46,180 |
Arlo Villanueva – Syst Tech (Maui) | $28,800 | $30,528 | $32,360 |
Caroline Nacua – Syst Tech (Maui) | $28,800 | $30,528 | $32,360 |
Vacant – Syst Tech (Kona) | $0 | $0 | $0 |
Vacant – Syst Tech (Maui) | $0 | $0 | $0 |
Subtotal | $317,100 | $336,126 | $356,294 |
Total People | 15 | 15 | 15 |
Total Payroll | $604,500 | $640,770 | $679,216 |
Bill Harding, president and general manager: XX years old, and has lived on Maui for 43 years. Joined SIOT in 1998 as Maui branch manager, and became general manager for Neighbor Island operations six months later. Prior management experience includes: BTA market manager of the Neighbor Islands for VoiceStream Wireless, Neighbor Island area sales manager for Central Security Systems, and radar project manager for Telcom International in Nigeria, West Africa. Bill has attended numerous management and sales training courses and seminars throughout his career.
Laurie Watson, secretary/treasurer and administrative manager: XX years old, and local Maui resident. Has been at the same location through three different owners prior to Servco’s acquisition of The Office Place in 1995, for a total of 15 years of local office equipment industry experience. Laurie has extensive knowledge of service procedures and dispatching, A/R and A/P procedures, inventory control and tracking, as well as an intimate knowledge of our customer base. Her experience and knowledge will be invaluable in recovering our customer base, and in growing the business.
Anne Tioganco, office manager (Hilo): XX years old, and local Hilo resident. Anne has also been with the company through all of the acquisitions, and has XX years experience in the office equipment industry. She will assist Laurie by handling the administrative and customer service tasks for our Hilo branch, and will be instrumental in our Big Island customer recovery efforts.
Earle Oshiro, systems manager (Big Island): XX years old, and local Hilo resident. Like Laurie and Anne above, Earle has been with the company through four different owners, and has XX years of local office equipment service management experience. Earle has also completed Canon’s “train the trainer” course, and will be a great asset in the on-going training and development of our systems engineers and technicians.
Joseph Alfonsi, systems manager (Maui): XX years old, and local Maui resident. Joe joined the Maui branch of SIOT in 1999 as field service manager, after transferring from the SIOT Honolulu branch. He has XX years of local office equipment industry service experience, and is familiar with both Canon and Ricoh products. Joe is an asset to the Maui team, and has outstanding customer service skills.
We believe we have a good team for covering the main points of the business plan. Key members have the experience and knowledge to manage and grow the business, and are highly motivated by the employee-owner concept.
The obvious management gap is a plan to fill the general manager’s position at some point in the future, before the current GM reaches retirement age. As an employee-owned company, the preferred strategy will be to promote from within, and fill vacancies as they occur. As the company grows, we will seek out additional talent in all operational areas.
Although we are treating the business as a start-up company, the financial plan is solidly based on past performance. We have taken actual SIOT P&L income and expenses from the past three years, and eliminated corporate overhead expenses such as warehouse and administrative costs, inventory penalties, and corporate nominal interest. We then projected income based on actual past performance, and factored back in the revenue base that was relocated to Honolulu over the past two years (mainly service and supplies).
We approached the financial planning from a conservative standpoint, and based those numbers on achievable gross margins. Also, our actual interest and tax rates will most likely be lower than the assumed rates due to our being structured as an employee-owned corporation (ESOT).
The financial plan depends on important assumptions, most of which are shown in Table 7.1. As mentioned previously, we assumed interest and tax rates based on a “worst case” scenario, and these will be adjusted once we have finalized the initial funding and establish the ESOT. We have also assumed our personnel burden at 30% of payroll in order to allow for above-average benefits for our employees. As we shop around for benefits vendors, this assumption will be subject to revision as well.
Other key business assumptions are:
General Assumptions | |||
Year 1 | Year 2 | Year 3 | |
Plan Month | 1 | 2 | 3 |
Current Interest Rate | 14.00% | 14.00% | 14.00% |
Long-term Interest Rate | 10.00% | 10.00% | 10.00% |
Tax Rate | 37.33% | 38.00% | 37.33% |
Other | 0 | 0 | 0 |
As shown in the Benchmarks chart below, our key financial indicators are:
For our break-even analysis, we assume running costs which include our full payroll, rent, and utilities, and an estimation of other running costs. Payroll alone, at present, is about $65,500 per month (including benefits and taxes).
We will monitor gross margins very closely, and maintain them at a midrange percentage by taking advantage of all promotions and discounts offered by our manufacturers. Canon USA has tentatively agreed to offer us “end column” pricing as a new dealer incentive.
The chart shows what we need to sell per month to break even, according to these assumptions. This is about 78% of our projected sales for our first year, and is well below what we have achieved annually over the past three years under more adverse operating conditions.
Break-even Analysis | |
Monthly Revenue Break-even | $209,018 |
Assumptions: | |
Average Percent Variable Cost | 51% |
Estimated Monthly Fixed Cost | $101,932 |
Our Pro Forma Profit and Loss statement was constructed from a conservative point-of-view, and is based in large part on past performance. By strengthening our service position, and rebuilding our customer relationships, we will widen our customer base and increase sales.
Month-to-month assumptions for profit and loss are included in the appendix.
Pro Forma Profit and Loss | |||
Year 1 | Year 2 | Year 3 | |
Sales | $3,190,329 | $3,668,878 | $4,219,209 |
Direct Cost of Sales | $1,634,497 | $1,863,326 | $2,124,192 |
Production Payroll | $0 | $0 | $0 |
Other | $0 | $0 | $0 |
Total Cost of Sales | $1,634,497 | $1,863,326 | $2,124,192 |
Gross Margin | $1,555,832 | $1,805,552 | $2,095,017 |
Gross Margin % | 48.77% | 49.21% | 49.65% |
Operating Expenses | |||
Sales and Marketing Expenses | |||
Sales and Marketing Payroll | $153,000 | $162,180 | $171,911 |
Advertising/Promotion | $10,500 | $11,130 | $11,798 |
Commissions | $159,516 | $169,087 | $179,233 |
Travel – Sales | $22,500 | $23,850 | $25,281 |
Learning & Growth – Sales | $6,150 | $6,519 | $6,910 |
Entertainment | $5,400 | $5,724 | $6,067 |
Total Sales and Marketing Expenses | $357,066 | $378,490 | $401,200 |
Sales and Marketing % | 11.19% | 10.32% | 9.51% |
General and Administrative Expenses | |||
General and Administrative Payroll | $134,400 | $142,464 | $151,012 |
Sales and Marketing and Other Expenses | $0 | $0 | $0 |
Depreciation | $0 | $0 | $0 |
Depreciation | $0 | $0 | $0 |
Utilities | $9,000 | $9,540 | $10,112 |
Telephone & ISP | $34,200 | $36,252 | $38,427 |
Office Supplies | $4,200 | $4,452 | $4,719 |
Insurance | $16,800 | $17,808 | $18,876 |
Bank Charges | $6,000 | $6,360 | $6,742 |
Postage | $10,020 | $10,621 | $11,258 |
Taxes & Licenses | $10,200 | $10,812 | $11,461 |
Bonuses | $0 | $0 | $0 |
Learning & Growth – Admin | $3,150 | $3,339 | $3,539 |
Accounting | $6,000 | $6,360 | $6,742 |
Rent | $72,000 | $72,000 | $72,000 |
Payroll Taxes | $181,350 | $192,231 | $203,765 |
Other General and Administrative Expenses | $0 | $0 | $0 |
Total General and Administrative Expenses | $487,320 | $512,239 | $538,654 |
General and Administrative % | 15.27% | 13.96% | 12.77% |
Other Expenses: | |||
Other Payroll | $317,100 | $336,126 | $356,294 |
Consultants | $0 | $0 | $0 |
Learning & Growth – Service | $9,200 | $9,752 | $10,337 |
Travel – Service | $22,500 | $23,850 | $25,281 |
Freight & Cartage | $30,000 | $31,800 | $33,708 |
Total Other Expenses | $378,800 | $401,528 | $425,620 |
Other % | 11.87% | 10.94% | 10.09% |
Total Operating Expenses | $1,223,186 | $1,292,258 | $1,365,473 |
Profit Before Interest and Taxes | $332,645 | $513,294 | $729,544 |
EBITDA | $332,645 | $513,294 | $729,544 |
Interest Expense | $140,000 | $127,050 | $99,750 |
Taxes Incurred | $72,797 | $146,773 | $235,123 |
Net Profit | $119,848 | $239,471 | $394,671 |
Net Profit/Sales | 3.76% | 6.53% | 9.35% |
Because we are treating the new company as a start-up, the cash flow for FY2002 is somewhat exaggerated by the instant influx of new capital. Subsequent years however show a healthy growth in cash flow, mainly due to the short 60-month repayment of the start-up loan and increased sales.
Pro Forma Cash Flow | |||
Year 1 | Year 2 | Year 3 | |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $2,073,714 | $2,384,771 | $2,742,486 |
Cash from Receivables | $906,354 | $1,252,568 | $1,440,453 |
Subtotal Cash from Operations | $2,980,067 | $3,637,339 | $4,182,939 |
Additional Cash Received | |||
Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 |
New Current Borrowing | $0 | $0 | $0 |
New Other Liabilities (interest-free) | $0 | $0 | $0 |
New Long-term Liabilities | $0 | $0 | $0 |
Sales of Other Current Assets | $0 | $0 | $0 |
Sales of Long-term Assets | $0 | $0 | $0 |
New Investment Received | $30,000 | $0 | $0 |
Subtotal Cash Received | $3,010,067 | $3,637,339 | $4,182,939 |
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $604,500 | $640,770 | $679,216 |
Bill Payments | $2,210,315 | $2,809,360 | $3,143,202 |
Subtotal Spent on Operations | $2,814,815 | $3,450,130 | $3,822,418 |
Additional Cash Spent | |||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 |
Principal Repayment of Current Borrowing | $0 | $185,000 | $205,000 |
Other Liabilities Principal Repayment | $0 | $0 | $0 |
Long-term Liabilities Principal Repayment | $0 | $0 | $0 |
Purchase Other Current Assets | $0 | $0 | $0 |
Purchase Long-term Assets | $0 | $0 | $0 |
Dividends | $0 | $0 | $0 |
Subtotal Cash Spent | $2,814,815 | $3,635,130 | $4,027,418 |
Net Cash Flow | $195,252 | $2,209 | $155,521 |
Cash Balance | $420,252 | $422,461 | $577,982 |
The Projected Balance Sheet is quite solid. We do not project any trouble meeting our debt obligations as long as we achieve our specific objectives.
Pro Forma Balance Sheet | |||
Year 1 | Year 2 | Year 3 | |
Assets | |||
Current Assets | |||
Cash | $420,252 | $422,461 | $577,982 |
Accounts Receivable | $210,261 | $241,801 | $278,071 |
Inventory | $172,142 | $196,241 | $223,715 |
Other Current Assets | $0 | $0 | $0 |
Total Current Assets | $802,655 | $860,503 | $1,079,768 |
Long-term Assets | |||
Long-term Assets | $0 | $0 | $0 |
Accumulated Depreciation | $0 | $0 | $0 |
Total Long-term Assets | $0 | $0 | $0 |
Total Assets | $802,655 | $860,503 | $1,079,768 |
Liabilities and Capital | Year 1 | Year 2 | Year 3 |
Current Liabilities | |||
Accounts Payable | $227,807 | $231,184 | $260,778 |
Current Borrowing | $1,000,000 | $815,000 | $610,000 |
Other Current Liabilities | $0 | $0 | $0 |
Subtotal Current Liabilities | $1,227,807 | $1,046,184 | $870,778 |
Long-term Liabilities | $0 | $0 | $0 |
Total Liabilities | $1,227,807 | $1,046,184 | $870,778 |
Paid-in Capital | $30,000 | $30,000 | $30,000 |
Retained Earnings | ($575,000) | ($455,152) | ($215,681) |
Earnings | $119,848 | $239,471 | $394,671 |
Total Capital | ($425,152) | ($185,681) | $208,990 |
Total Liabilities and Capital | $802,655 | $860,503 | $1,079,768 |
Net Worth | ($425,152) | ($185,681) | $208,990 |
The following table shows our main business ratios, and is compared to national averages. Our SIC industry class is currently: Office equipment, nec – 5044.99.
Ratio Analysis | ||||
Year 1 | Year 2 | Year 3 | Industry Profile | |
Sales Growth | 0.00% | 15.00% | 15.00% | 1.50% |
Percent of Total Assets | ||||
Accounts Receivable | 26.20% | 28.10% | 25.75% | 30.97% |
Inventory | 21.45% | 22.81% | 20.72% | 38.08% |
Other Current Assets | 0.00% | 0.00% | 0.00% | 16.04% |
Total Current Assets | 100.00% | 100.00% | 100.00% | 85.09% |
Long-term Assets | 0.00% | 0.00% | 0.00% | 14.91% |
Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
Current Liabilities | 152.97% | 121.58% | 80.64% | 44.30% |
Long-term Liabilities | 0.00% | 0.00% | 0.00% | 8.46% |
Total Liabilities | 152.97% | 121.58% | 80.64% | 52.76% |
Net Worth | -52.97% | -21.58% | 19.36% | 47.24% |
Percent of Sales | ||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 48.77% | 49.21% | 49.65% | 26.76% |
Selling, General & Administrative Expenses | 45.02% | 42.69% | 40.40% | 15.95% |
Advertising Expenses | 0.33% | 0.30% | 0.28% | 0.95% |
Profit Before Interest and Taxes | 10.43% | 13.99% | 17.29% | 2.55% |
Main Ratios | ||||
Current | 0.65 | 0.82 | 1.24 | 1.80 |
Quick | 0.51 | 0.63 | 0.98 | 0.87 |
Total Debt to Total Assets | 152.97% | 121.58% | 80.64% | 6.22% |
Pre-tax Return on Net Worth | -45.31% | -208.01% | 301.35% | 55.95% |
Pre-tax Return on Assets | 24.00% | 44.89% | 58.33% | 14.11% |
Additional Ratios | Year 1 | Year 2 | Year 3 | |
Net Profit Margin | 3.76% | 6.53% | 9.35% | n.a |
Return on Equity | 0.00% | 0.00% | 188.85% | n.a |
Activity Ratios | ||||
Accounts Receivable Turnover | 5.31 | 5.31 | 5.31 | n.a |
Collection Days | 57 | 64 | 64 | n.a |
Inventory Turnover | 10.91 | 10.12 | 10.12 | n.a |
Accounts Payable Turnover | 10.70 | 12.17 | 12.17 | n.a |
Payment Days | 27 | 30 | 28 | n.a |
Total Asset Turnover | 3.97 | 4.26 | 3.91 | n.a |
Debt Ratios | ||||
Debt to Net Worth | 0.00 | 0.00 | 4.17 | n.a |
Current Liab. to Liab. | 1.00 | 1.00 | 1.00 | n.a |
Liquidity Ratios | ||||
Net Working Capital | ($425,152) | ($185,681) | $208,990 | n.a |
Interest Coverage | 2.38 | 4.04 | 7.31 | n.a |
Additional Ratios | ||||
Assets to Sales | 0.25 | 0.23 | 0.26 | n.a |
Current Debt/Total Assets | 153% | 122% | 81% | n.a |
Acid Test | 0.34 | 0.40 | 0.66 | n.a |
Sales/Net Worth | 0.00 | 0.00 | 20.19 | n.a |
Dividend Payout | 0.00 | 0.00 | 0.00 | n.a |
Sales Forecast | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Sales | |||||||||||||
Hardware – Image Platforms | 0% | $78,500 | $78,500 | $78,500 | $86,350 | $86,350 | $86,350 | $94,985 | $94,985 | $94,985 | $104,484 | $104,484 | $104,484 |
Hardware – Printers | 0% | $5,000 | $5,000 | $5,000 | $5,500 | $5,500 | $5,500 | $6,050 | $6,050 | $6,050 | $6,655 | $6,655 | $6,655 |
Hardware – Facsimiles | 0% | $10,250 | $10,250 | $10,250 | $11,275 | $11,275 | $11,275 | $12,403 | $12,403 | $12,403 | $13,643 | $13,643 | $13,643 |
Hardware – Misc (TW, Shrd) | 0% | $3,250 | $3,250 | $3,250 | $3,575 | $3,575 | $3,575 | $3,933 | $3,933 | $3,933 | $4,326 | $4,326 | $4,326 |
Professional Services | 0% | $0 | $0 | $2,500 | $2,750 | $2,750 | $2,750 | $3,025 | $3,025 | $3,025 | $3,328 | $3,328 | $3,328 |
Government (Comp) | 0% | $6,250 | $6,250 | $6,250 | $6,875 | $6,875 | $6,875 | $7,563 | $7,563 | $7,563 | $8,319 | $8,319 | $8,319 |
Supplies (Toner/Paper) | 0% | $36,000 | $36,000 | $36,000 | $39,600 | $39,600 | $39,600 | $43,560 | $43,560 | $43,560 | $47,916 | $47,916 | $47,916 |
Service – Agreements/Repairs | 0% | $68,000 | $68,000 | $68,000 | $74,800 | $74,800 | $74,800 | $82,280 | $82,280 | $82,280 | $90,508 | $90,508 | $90,508 |
Equipment Rentals | 0% | $17,500 | $17,500 | $17,500 | $19,250 | $19,250 | $19,250 | $21,175 | $21,175 | $21,175 | $23,293 | $23,293 | $23,293 |
Other | 0% | $2,250 | $2,250 | $2,250 | $2,475 | $2,475 | $2,475 | $2,723 | $2,723 | $2,723 | $2,995 | $2,995 | $2,995 |
Total Sales | $227,000 | $227,000 | $229,500 | $252,450 | $252,450 | $252,450 | $277,695 | $277,695 | $277,695 | $305,465 | $305,465 | $305,465 | |
Direct Cost of Sales | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Hardware – Image Platforms | $48,670 | $48,670 | $48,670 | $53,537 | $53,537 | $53,537 | $58,891 | $58,891 | $58,891 | $64,780 | $64,780 | $64,780 | |
Hardware – Printers | $3,250 | $3,250 | $3,250 | $3,575 | $3,575 | $3,575 | $3,933 | $3,933 | $3,933 | $4,326 | $4,326 | $4,326 | |
Hardware – Facsimiles | $6,355 | $6,355 | $6,355 | $6,991 | $6,991 | $6,991 | $7,690 | $7,690 | $7,690 | $8,459 | $8,459 | $8,459 | |
Hardware – Misc (TW, Shrd) | $2,275 | $2,275 | $2,275 | $2,503 | $2,503 | $2,503 | $2,753 | $2,753 | $2,753 | $3,028 | $3,028 | $3,028 | |
Professional Services | $0 | $0 | $1,250 | $1,375 | $1,375 | $1,375 | $1,513 | $1,513 | $1,513 | $1,664 | $1,664 | $1,664 | |
Government (Comp) | $2,188 | $2,188 | $2,188 | $2,406 | $2,406 | $2,406 | $2,647 | $2,647 | $2,647 | $2,912 | $2,912 | $2,912 | |
Supplies (Toner/Paper) | $16,200 | $16,200 | $16,200 | $17,820 | $17,820 | $17,820 | $19,602 | $19,602 | $19,602 | $21,562 | $21,562 | $21,562 | |
Service – Agreements/Repairs | $27,200 | $27,200 | $27,200 | $29,920 | $29,920 | $29,920 | $32,912 | $32,912 | $32,912 | $36,203 | $36,203 | $36,203 | |
Equipment Rentals | $9,625 | $9,625 | $9,625 | $10,588 | $10,588 | $10,588 | $11,646 | $11,646 | $11,646 | $12,811 | $12,811 | $12,811 | |
Other | $563 | $563 | $563 | $619 | $619 | $619 | $681 | $681 | $681 | $749 | $749 | $749 | |
Subtotal Direct Cost of Sales | $116,325 | $116,325 | $117,575 | $129,333 | $129,333 | $129,333 | $142,266 | $142,266 | $142,266 | $156,492 | $156,492 | $156,492 |
Personnel Plan | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Production Personnel | |||||||||||||
None planned | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales and Marketing Personnel | |||||||||||||
Alan Fukuyama – Sales (Maui) | $3,000 | $3,000 | $3,000 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | |
Brian Kurlansky – Sales (Kona) | $3,000 | $3,000 | $3,000 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | |
Jay Moore – Sales (Maui) | $3,000 | $3,000 | $3,000 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | |
Wilbert Shimabukuro – Sales (Hilo) | $3,000 | $3,000 | $3,000 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | $3,250 | |
Vacant – Aftermarket Sales (Maui) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Vacant – Aftermarket Sales (Hilo) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal | $12,000 | $12,000 | $12,000 | $13,000 | $13,000 | $13,000 | $13,000 | $13,000 | $13,000 | $13,000 | $13,000 | $13,000 | |
General and Administrative Personnel | |||||||||||||
Bill Harding – General Manager | $4,500 | $4,500 | $4,500 | $4,900 | $4,900 | $4,900 | $4,900 | $4,900 | $4,900 | $4,900 | $4,900 | $4,900 | |
Laurie Watson – Admin Manager | $3,650 | $3,650 | $3,650 | $3,850 | $3,850 | $3,850 | $3,850 | $3,850 | $3,850 | $3,850 | $3,850 | $3,850 | |
Vacant – Office Manager (Hilo) | $2,450 | $2,450 | $2,450 | $2,650 | $2,650 | $2,650 | $2,650 | $2,650 | $2,650 | $2,650 | $2,650 | $2,650 | |
Vacant – Whse & Delivery (Maui) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Vacant – Whse & Delivery (Hilo) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal | $10,600 | $10,600 | $10,600 | $11,400 | $11,400 | $11,400 | $11,400 | $11,400 | $11,400 | $11,400 | $11,400 | $11,400 | |
Other Personnel | |||||||||||||
Earle Oshiro – Systems Manager (Hilo) | $4,000 | $4,000 | $4,000 | $4,200 | $4,200 | $4,200 | $4,200 | $4,200 | $4,200 | $4,200 | $4,200 | $4,200 | |
Joe Alfonsi – Systems Manager (Maui) | $4,000 | $4,000 | $4,000 | $4,200 | $4,200 | $4,200 | $4,200 | $4,200 | $4,200 | $4,200 | $4,200 | $4,200 | |
Wane Ogawa – Syst Engineer (Hilo) | $3,150 | $3,150 | $3,150 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | |
Francis Takahashi – Syst Engineer (Hilo) | $3,150 | $3,150 | $3,150 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | |
Baron Ganeko – Syst Engineer (Kona) | $3,150 | $3,150 | $3,150 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | $3,350 | |
Abe Braceros – Sr. Syst Engineer (Maui) | $3,200 | $3,200 | $3,200 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | |
Arlo Villanueva – Syst Tech (Maui) | $2,250 | $2,250 | $2,250 | $2,450 | $2,450 | $2,450 | $2,450 | $2,450 | $2,450 | $2,450 | $2,450 | $2,450 | |
Caroline Nacua – Syst Tech (Maui) | $2,250 | $2,250 | $2,250 | $2,450 | $2,450 | $2,450 | $2,450 | $2,450 | $2,450 | $2,450 | $2,450 | $2,450 | |
Vacant – Syst Tech (Kona) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Vacant – Syst Tech (Maui) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal | $25,150 | $25,150 | $25,150 | $26,850 | $26,850 | $26,850 | $26,850 | $26,850 | $26,850 | $26,850 | $26,850 | $26,850 | |
Total People | 15 | 15 | 15 | 15 | 15 | 15 | 15 | 15 | 15 | 15 | 15 | 15 | |
Total Payroll | $47,750 | $47,750 | $47,750 | $51,250 | $51,250 | $51,250 | $51,250 | $51,250 | $51,250 | $51,250 | $51,250 | $51,250 |
General Assumptions | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Plan Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |
Current Interest Rate | 14.00% | 14.00% | 14.00% | 14.00% | 14.00% | 14.00% | 14.00% | 14.00% | 14.00% | 14.00% | 14.00% | 14.00% | |
Long-term Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
Tax Rate | 30.00% | 38.00% | 38.00% | 38.00% | 38.00% | 38.00% | 38.00% | 38.00% | 38.00% | 38.00% | 38.00% | 38.00% | |
Other | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Pro Forma Profit and Loss | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Sales | $227,000 | $227,000 | $229,500 | $252,450 | $252,450 | $252,450 | $277,695 | $277,695 | $277,695 | $305,465 | $305,465 | $305,465 | |
Direct Cost of Sales | $116,325 | $116,325 | $117,575 | $129,333 | $129,333 | $129,333 | $142,266 | $142,266 | $142,266 | $156,492 | $156,492 | $156,492 | |
Production Payroll | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Cost of Sales | $116,325 | $116,325 | $117,575 | $129,333 | $129,333 | $129,333 | $142,266 | $142,266 | $142,266 | $156,492 | $156,492 | $156,492 | |
Gross Margin | $110,675 | $110,675 | $111,925 | $123,118 | $123,118 | $123,118 | $135,429 | $135,429 | $135,429 | $148,972 | $148,972 | $148,972 | |
Gross Margin % | 48.76% | 48.76% | 48.77% | 48.77% | 48.77% | 48.77% | 48.77% | 48.77% | 48.77% | 48.77% | 48.77% | 48.77% | |
Operating Expenses | |||||||||||||
Sales and Marketing Expenses | |||||||||||||
Sales and Marketing Payroll | $12,000 | $12,000 | $12,000 | $13,000 | $13,000 | $13,000 | $13,000 | $13,000 | $13,000 | $13,000 | $13,000 | $13,000 | |
Advertising/Promotion | $500 | $500 | $500 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | |
Commissions | $11,350 | $11,350 | $11,475 | $12,623 | $12,623 | $12,623 | $13,885 | $13,885 | $13,885 | $15,273 | $15,273 | $15,273 | |
Travel – Sales | $1,500 | $1,500 | $1,500 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | |
Learning & Growth – Sales | $0 | $0 | $0 | $400 | $400 | $400 | $400 | $400 | $400 | $1,250 | $1,250 | $1,250 | |
Entertainment | $450 | $450 | $450 | $450 | $450 | $450 | $450 | $450 | $450 | $450 | $450 | $450 | |
Total Sales and Marketing Expenses | $25,800 | $25,800 | $25,925 | $29,473 | $29,473 | $29,473 | $30,735 | $30,735 | $30,735 | $32,973 | $32,973 | $32,973 | |
Sales and Marketing % | 11.37% | 11.37% | 11.30% | 11.67% | 11.67% | 11.67% | 11.07% | 11.07% | 11.07% | 10.79% | 10.79% | 10.79% | |
General and Administrative Expenses | |||||||||||||
General and Administrative Payroll | $10,600 | $10,600 | $10,600 | $11,400 | $11,400 | $11,400 | $11,400 | $11,400 | $11,400 | $11,400 | $11,400 | $11,400 | |
Sales and Marketing and Other Expenses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Depreciation | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Depreciation | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Utilities | $750 | $750 | $750 | $750 | $750 | $750 | $750 | $750 | $750 | $750 | $750 | $750 | |
Telephone & ISP | $2,850 | $2,850 | $2,850 | $2,850 | $2,850 | $2,850 | $2,850 | $2,850 | $2,850 | $2,850 | $2,850 | $2,850 | |
Office Supplies | $350 | $350 | $350 | $350 | $350 | $350 | $350 | $350 | $350 | $350 | $350 | $350 | |
Insurance | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | |
Bank Charges | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | |
Postage | $835 | $835 | $835 | $835 | $835 | $835 | $835 | $835 | $835 | $835 | $835 | $835 | |
Taxes & Licenses | $850 | $850 | $850 | $850 | $850 | $850 | $850 | $850 | $850 | $850 | $850 | $850 | |
Bonuses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Learning & Growth – Admin | $0 | $0 | $0 | $150 | $150 | $150 | $150 | $150 | $150 | $750 | $750 | $750 | |
Accounting | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | |
Rent | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | |
Payroll Taxes | 30% | $14,325 | $14,325 | $14,325 | $15,375 | $15,375 | $15,375 | $15,375 | $15,375 | $15,375 | $15,375 | $15,375 | $15,375 |
Other General and Administrative Expenses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total General and Administrative Expenses | $38,960 | $38,960 | $38,960 | $40,960 | $40,960 | $40,960 | $40,960 | $40,960 | $40,960 | $41,560 | $41,560 | $41,560 | |
General and Administrative % | 17.16% | 17.16% | 16.98% | 16.22% | 16.22% | 16.22% | 14.75% | 14.75% | 14.75% | 13.61% | 13.61% | 13.61% | |
Other Expenses: | |||||||||||||
Other Payroll | $25,150 | $25,150 | $25,150 | $26,850 | $26,850 | $26,850 | $26,850 | $26,850 | $26,850 | $26,850 | $26,850 | $26,850 | |
Consultants | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Learning & Growth – Service | $0 | $0 | $0 | $850 | $850 | $850 | $650 | $650 | $850 | $1,500 | $1,500 | $1,500 | |
Travel – Service | $1,500 | $1,500 | $1,500 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | |
Freight & Cartage | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | |
Total Other Expenses | $29,150 | $29,150 | $29,150 | $32,200 | $32,200 | $32,200 | $32,000 | $32,000 | $32,200 | $32,850 | $32,850 | $32,850 | |
Other % | 12.84% | 12.84% | 12.70% | 12.76% | 12.76% | 12.76% | 11.52% | 11.52% | 11.60% | 10.75% | 10.75% | 10.75% | |
Total Operating Expenses | $93,910 | $93,910 | $94,035 | $102,633 | $102,633 | $102,633 | $103,695 | $103,695 | $103,895 | $107,383 | $107,383 | $107,383 | |
Profit Before Interest and Taxes | $16,765 | $16,765 | $17,890 | $20,485 | $20,485 | $20,485 | $31,735 | $31,735 | $31,535 | $41,589 | $41,589 | $41,589 | |
EBITDA | $16,765 | $16,765 | $17,890 | $20,485 | $20,485 | $20,485 | $31,735 | $31,735 | $31,535 | $41,589 | $41,589 | $41,589 | |
Interest Expense | $11,667 | $11,667 | $11,667 | $11,667 | $11,667 | $11,667 | $11,667 | $11,667 | $11,667 | $11,667 | $11,667 | $11,667 | |
Taxes Incurred | $1,530 | $1,937 | $2,365 | $3,351 | $3,351 | $3,351 | $7,626 | $7,626 | $7,550 | $11,370 | $11,370 | $11,370 | |
Net Profit | $3,569 | $3,161 | $3,858 | $5,467 | $5,467 | $5,467 | $12,442 | $12,442 | $12,318 | $18,552 | $18,552 | $18,552 | |
Net Profit/Sales | 1.57% | 1.39% | 1.68% | 2.17% | 2.17% | 2.17% | 4.48% | 4.48% | 4.44% | 6.07% | 6.07% | 6.07% |
Pro Forma Cash Flow | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Cash Received | |||||||||||||
Cash from Operations | |||||||||||||
Cash Sales | $147,550 | $147,550 | $149,175 | $164,093 | $164,093 | $164,093 | $180,502 | $180,502 | $180,502 | $198,552 | $198,552 | $198,552 | |
Cash from Receivables | $0 | $2,648 | $79,450 | $79,479 | $80,593 | $88,358 | $88,358 | $88,652 | $97,193 | $97,193 | $97,517 | $106,913 | |
Subtotal Cash from Operations | $147,550 | $150,198 | $228,625 | $243,572 | $244,685 | $252,450 | $268,859 | $269,154 | $277,695 | $295,745 | $296,069 | $305,465 | |
Additional Cash Received | |||||||||||||
Sales Tax, VAT, HST/GST Received | 0.00% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
New Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Other Liabilities (interest-free) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Long-term Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales of Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales of Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Investment Received | $30,000 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Received | $177,550 | $150,198 | $228,625 | $243,572 | $244,685 | $252,450 | $268,859 | $269,154 | $277,695 | $295,745 | $296,069 | $305,465 | |
Expenditures | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Expenditures from Operations | |||||||||||||
Cash Spending | $47,750 | $47,750 | $47,750 | $51,250 | $51,250 | $51,250 | $51,250 | $51,250 | $51,250 | $51,250 | $51,250 | $51,250 | |
Bill Payments | $3,455 | $106,054 | $176,195 | $180,247 | $208,235 | $195,733 | $196,816 | $227,755 | $214,007 | $215,366 | $250,790 | $235,663 | |
Subtotal Spent on Operations | $51,205 | $153,804 | $223,945 | $231,497 | $259,485 | $246,983 | $248,066 | $279,005 | $265,257 | $266,616 | $302,040 | $286,913 | |
Additional Cash Spent | |||||||||||||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Principal Repayment of Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Long-term Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Purchase Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Purchase Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Dividends | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Spent | $51,205 | $153,804 | $223,945 | $231,497 | $259,485 | $246,983 | $248,066 | $279,005 | $265,257 | $266,616 | $302,040 | $286,913 | |
Net Cash Flow | $126,345 | ($3,605) | $4,680 | $12,075 | ($14,800) | $5,467 | $20,793 | ($9,852) | $12,438 | $29,129 | ($5,971) | $18,552 | |
Cash Balance | $351,345 | $347,740 | $352,420 | $364,495 | $349,696 | $355,163 | $375,956 | $366,105 | $378,543 | $407,672 | $401,700 | $420,252 |
Pro Forma Balance Sheet | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Assets | Starting Balances | ||||||||||||
Current Assets | |||||||||||||
Cash | $225,000 | $351,345 | $347,740 | $352,420 | $364,495 | $349,696 | $355,163 | $375,956 | $366,105 | $378,543 | $407,672 | $401,700 | $420,252 |
Accounts Receivable | $0 | $79,450 | $156,252 | $157,127 | $166,005 | $173,770 | $173,770 | $182,606 | $191,147 | $191,147 | $200,866 | $210,261 | $210,261 |
Inventory | $200,000 | $127,958 | $127,958 | $129,333 | $142,266 | $142,266 | $142,266 | $156,492 | $156,492 | $156,492 | $172,142 | $172,142 | $172,142 |
Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Current Assets | $425,000 | $558,753 | $631,949 | $638,879 | $672,766 | $665,731 | $671,199 | $715,054 | $713,744 | $726,182 | $780,679 | $784,103 | $802,655 |
Long-term Assets | |||||||||||||
Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Accumulated Depreciation | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Assets | $425,000 | $558,753 | $631,949 | $638,879 | $672,766 | $665,731 | $671,199 | $715,054 | $713,744 | $726,182 | $780,679 | $784,103 | $802,655 |
Liabilities and Capital | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Current Liabilities | |||||||||||||
Accounts Payable | $0 | $100,184 | $170,219 | $173,291 | $201,710 | $189,208 | $189,208 | $220,622 | $206,870 | $206,989 | $242,935 | $227,807 | $227,807 |
Current Borrowing | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 |
Other Current Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Subtotal Current Liabilities | $1,000,000 | $1,100,184 | $1,170,219 | $1,173,291 | $1,201,710 | $1,189,208 | $1,189,208 | $1,220,622 | $1,206,870 | $1,206,989 | $1,242,935 | $1,227,807 | $1,227,807 |
Long-term Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Liabilities | $1,000,000 | $1,100,184 | $1,170,219 | $1,173,291 | $1,201,710 | $1,189,208 | $1,189,208 | $1,220,622 | $1,206,870 | $1,206,989 | $1,242,935 | $1,227,807 | $1,227,807 |
Paid-in Capital | $0 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 |
Retained Earnings | ($575,000) | ($575,000) | ($575,000) | ($575,000) | ($575,000) | ($575,000) | ($575,000) | ($575,000) | ($575,000) | ($575,000) | ($575,000) | ($575,000) | ($575,000) |
Earnings | $0 | $3,569 | $6,730 | $10,588 | $16,056 | $21,523 | $26,990 | $39,432 | $51,874 | $64,193 | $82,744 | $101,296 | $119,848 |
Total Capital | ($575,000) | ($541,431) | ($538,270) | ($534,412) | ($528,944) | ($523,477) | ($518,010) | ($505,568) | ($493,126) | ($480,807) | ($462,256) | ($443,704) | ($425,152) |
Total Liabilities and Capital | $425,000 | $558,753 | $631,949 | $638,879 | $672,766 | $665,731 | $671,199 | $715,054 | $713,744 | $726,182 | $780,679 | $784,103 | $802,655 |
Net Worth | ($575,000) | ($541,431) | ($538,270) | ($534,412) | ($528,944) | ($523,477) | ($518,010) | ($505,568) | ($493,126) | ($480,807) | ($462,256) | ($443,704) | ($425,152) |
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Many of us have this wild dream of becoming a hot-shot CEO with a cup of overpriced coffee on one hand and the latest smartphone on the other, but to get there, you still need to start fresh. You may also see business plan outline with examples .
Having a good business idea is one thing, but turning this vision into a reality is another matter that many individuals refuse to invest on when the struggles they need to go through become known.
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With the many opportunities and promising business ideas to choose from, business owners are starting to recognize what technology can offer them not just for personal use, but as a corporate investment as well.
Amidst the likes of Apple, Samsung, and Sony comes the wide variety of tech startups emerging in the marketplace at rapid speed. So in this article, we discuss what it takes to become a successful tech startup with the help of a simple business plan .
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With the wide use of technology being more prominent now than ever, many tech startups are making the attempt to make a breakthrough in the competitive market with their innovative (and sometimes peculiar) product and service offers for consumers to enjoy. You may also like business plan guidelines examples . A tech startup is a company whose purpose is to bring various forms of technology-based products and services to the market. These companies are set to deliver a wide range of new or existing technology products or services in a variety of ways.
They come in the form of a company, a partnership, or a temporary organization that is designed to search for a repeatable and scalable business model to launch. With technology being an essential factor of our day-to-day lives, startups aim to bring innovativeness, scalability, and growth through their creations. Though it might be a while until robots and artificial intelligence completely replace manual labor, we can expect a lot from these promising tech startup ideas, especially those with an exceptional business plan in place. You may also see business operational plan examples .
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Every tech startup is different, with each company specializing in one thing that’s fairly different from the other. But if there’s one principle that every startup company needs, then it’s the universal wisdom of experience. You may also like to learn how to create a business plan . Truth is, many companies have attempted to try new things but failed while at it. Others have pivoted and re-branded hoping to get another shot with investors and clients, only to come out empty-handed.
Transforming your big idea into a revenue-generating reality can be a daunting experience of disappointments and rejections. But then again, in order to succeed in business (and life in general), you need to learn from these experiences to come out a million times better. The following items explain what makes a tech startup successful and the factors that you need to keep in mind when constructing your business plan :
This may sound like an egoistic move, but don’t take it the wrong way.
As a startup business, it wouldn’t hurt to pretend you’re a lot bigger than you actually are. They say that this can attract the type of energy you hope to achieve. Acting like a bigger company will also allow you to grow into the efficiencies it gives you. It also requires you to work just as hard as the big dogs do. Not to say you’re prohibited from having a fun work environment, as you do want to keep employees happy for them to stick around long enough for the company to prosper, but insisting on a disciplined execution will definitely keep the business afloat. This will make it easier to partner or collaborate with other successful brands who might just offer you your big break. You may also check out market analysis business plan examples .
As a startup founder, choosing the right partners to complement your skill set and realize your vision is crucial to corporate success. Partnerships can be a tricky business, especially when it has become so easy for offshore or outsourcing companies to squeeze the money out of a vulnerable (and rather gullible) startup. It’s best to do your research on existing companies and startup founders, preferably those who have been a part of a successful company in the past, before you engage in a potential deal. You may also see network marketing business plan examples .
You know how TV shows come out with pilot episodes first before they can release an entire season of the show? With the same concept in mind, experts believe that it’s always best to start selling parts of your product before completing a full platform. Getting market validation early on in your startup’s growth stage will give an idea of what your target customers are looking for in a product or service. This will also help you start building revenue as you continue to understand how the entire process works. You may also like how to make a business plan .
They also believe that while a good business idea is important, so is the way it is presented to investors and clients. Allowing your prospects to see your capabilities will work wonders for your startup along the way. You may also check out importance of business plan .
It’s always hard to make a pitch with a potential investor. With the dozens of business ideas that come their way, standing out from the “good” and the “pretty good” is crucial to getting noticed. Your pitch with a prospect will only end with one of two ways: you either get accepted or declined. Naturally, getting accepted is the only thing that matters most. You might be interested in free business plan examples .
Since it may be difficult to identify the things that you should do and should not do for your pitch, it’s a good idea to speak with entrepreneurs with businesses that did not make it. It’s easy to focus on the successes, but not many seem to recognize the value of failures as well. This provides you with enough insight regarding how and why a company or an idea did not make the cut. You may also see bookkeeping business plan examples .
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You’ve probably heard this a thousands times before, and it couldn’t be emphasized enough. Rejection will always be a possibility, but just because a couple of investors have said “no” to you before, don’t use this as a reason to give up.
Getting the first check is the hardest, which is why many successful business owners suggest to spend the time building VC (Venture Capital) relationships before funding, and to continue networking until you have secured the necessary funds. The rejection will definitely take a toll in your spirit and drive to move forward, but you need to learn to get back up and rise above the negativity for a better and brighter future. You may also see hotel business plan examples .
There should never be a reason to stop building. You can always turn a “good” idea into something “great.” And even if it feels like you’ve reached the peak of greatness, there will always be room for more improvement.
Take tech giant Apple as an example. Even when people thought that the Touch ID of the iPhone 5S was a phenomenal feature, Apple released a facial recognition feature through Face ID which was specially designed for the iPhone X. The system was designed just a few years after the Touch ID, which proves just how the company continues to uphold the value of innovation through their products. You may also check out advertising and marketing business plan examples .
Startup founders tend to be optimistic and idea-driven, yet, they can’t seem to confine to the status quo. Though adapting to market demands is also important, picking a single area of innovation and focusing on a product that’s better than anyone else’s is key. You need to make sure you’re moving toward the right direction by understanding the exact things that your target market wants. You may also like business plan examples .
However, you need to work quickly. Trends fade and people get bored too easily. If you want to prosper, start delivering products as soon as you can and stay focused on making them a hit.
Even after an investor has made a vow to work with you, you still need to put it in writing. Contract documents are a real thing, and you need to be responsible for them. This goes both ways in your professional relationship, as you’d want to make your counterpart feel comfortable to work with you, and you need to be able to trust that these prospects would stick to their word.
Though creating these formal documents may be pricey, it’s definitely worth the spend to guarantee long-term business relationships.
You might have heard about various prediction market platforms and forecasting tools that have allowed users to foresee the outcomes of real-world events, as well as buying and selling shares through smart contracts. You might be interested in simple business plan examples .
While building on blockchain or relying on cryptocurrency may seem like a promising venture, you’d still want to sketch out a full architecture of your plan, challenge it, and then build it.
Even with the potential risks and challenges that may cause your business to fail along the way, you still need to be optimistic enough to plan for the long-term. Investing in strong talent and developing a culture for your business to thrive on will help build a solid foundation for your startup. This will also pave the way for many opportunities, leading your business to the right direction. You may also see bar business plan examples .
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Anyone can have a great idea; in fact, you can ask a 12-year-old for a business idea and they’d probably give you something more imaginative than what any other 30-year-old could offer. But transforming this idea into a viable business is a different ballgame you wouldn’t want to mess up. You may also see e-commerce marketing plan examples .
So if you’re hoping to launch a tech startup anytime soon, here are a few tips on how you can create an effective business plan:
Set a clear objective that’s anything but ambiguous. You need to be specific about what you hope to achieve. Since starting a business requires you to offer a solution in order to address a problem, your business plan should identify who you are and what you aim to do. You must also state the kind of products and services you’ll be offering and in what industry for a more specific approach. You may also see convenience store business plan .
Although your products and services will be made available for the general public, it isn’t exactly designed for everyone. Some tech startups create products for other businesses, while others cater to buying customers of a specified demographic. Knowing who your target consumers are will help you determine every detail of the product, its ideal market price, the right distribution channels, as well as your promotional strategies. You may also see business checklist examples .
Another important factor to include in your research is your competition. You need to remember that as a startup, no one knows about you, let alone care that you exist. With so many direct competitors in the marketplace, standing out is a definite must. Figure out what makes you different from other existing companies, and you can go from there. A SWOT analysis may also be used for proper assessment.
Running out of cash is one of the primary reasons why many businesses fail. You might start out with a million dollars in capital, but be down to your last thousands after a year or two. When this happens, your business is at risk of closing and filing for bankruptcy. This is why it’s important to take the time to budget accordingly to help minimize the risk. You may also check out marketing strategy business plan examples .
Running a tech startup can never be a one-man show. You need to have a reliable team of staff members to manage each department of the company, including your accounting, marketing, operations, and HR sectors. This doesn’t have to be too complex, as new businesses usually start small before they begin expanding. You may also see digital marketing plan examples .
Launching a startup company can be an exciting experience for any ambitious entrepreneur. However, it’s easy to rush into things and wind up regretting your wrongful decisions. So before anything else, always remember to write a good business plan to launch your company on the right foot. You may also like business plan examples in PDF .
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Founders have to learn so many new skills when they're launching a startup, and writing a business plan is a big one. When you're writing your business plan for the first time, things can get… intimidating.
What do you include? What kind of wording should you use? What do you make sure not to include? Is a mid size business plan different than an enterprise plan or a scalable startup? Do I need to include financials like cash flow statements? What do investors want to see?
It's enough to make even a stalwart startup founder and management team throw in the towel before they've even begun.
Lucky for you — we've created a complete guide to writing your business plan . Check it out if you haven't already. (And if a link from there brought you here, just keep reading!) We'll share some business plan samples so you can get started writing your own professional business plan.
But, while it's nice to be guided step-by-step, it can also really help to have concrete examples when you're approaching creating something for the first time.
So, with that in mind, here are four sample business plans from the Startups community that we think really stand out from the crowd. We hope that these will serve as a startup business plan template and make it easier to write your own. At a minimum, these will provide some great business plan ideas whether you are writing traditional business plans for an established business or biz plans for an innovative new startup. While we would of course suggest you use our business plan creator, Bizplan.com, you can use these examples with any number of business plan apps or business plan software.
Click on the below links to see fully formatted versions or continue reading for the text-only version of Culina's.
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Fast facts:.
Founded: 2013 Headquarters: San Francisco, CA Founder: Kent McClure Market Size: $12.5 billion Target Audience: Homeowners; property managers; insurance providers.
Culina is a San Francisco-based IoT and home automation company. We design an advanced smart hub technology that enables users to interconnect and remotely monitor all of their cooking devices and kitchen appliances through a single user-friendly platform.
To make homes smarter, more connected, and safer for families while helping them save money and conserve energy through the power of affordable, automated technology.
To become the leading provider of IoT technology for kitchen appliances on a global scale with applications across both residential and commercial properties.
Culina Tech is the next leading name in home automation and IoT. We're committed to leading the charge in creating the ultimate smart kitchen for homeowners all around the world. Our revolutionary Smart Plugs enable users to make any kitchen appliance or cooking device intelligent. Compatible with all existing brands that plug into standard two or three-prong wall outlets, Culina creates an entire network of Wi-Fi-connected kitchen devices. The Culina App allows users to remotely monitor the status of and control all devices connected to our Smart Plugs. Whether it's remotely turning on the coffee pot after getting out of bed, turning off the stove if it was accidentally left on via smartphone, or switching on the crockpot before getting home from work, Culina is purpose-built to deliver unrivaled convenience and peace of mind.
With the ability to set energy usage caps on a daily, weekly, or monthly basis, Culina helps homeowners stay within their monthly utility budget and save energy in the kitchen through more efficient use of the dishwasher, refrigerator, freezer, stove, and other common appliances.
When a device reaches its energy limit, Culina alerts users through their smartphone and is built with the ability to power down the device automatically if the user chooses. The App measures key usage metrics in real-time, allowing users to get an instant dashboard view of energy consumption as it occurs.
Our team has already finished the product development and design phase, with 3 prototype iterations completed, and we are now ready to begin mass manufacturing. We've also gained major traction among consumers and investors alike, with 10,000 pre-ordered units sold and $5 million in capital secured to date.
With this round of funding, our objective is to ramp up hardware manufacturing, improve software UX and UI, expand our sales and marketing efforts, and fulfill pre-orders in time for the 2017 holiday season. We are currently seeking a $15M Series B capital investment that will give us the financial flexibility to achieve these goals. On behalf of the entire Culina Tech team, we'd like to thank you for your time and interest in our company and this investment opportunity.
⇾ 30% Manufacturing ⇾ 25% Sales & Marketing ⇾ 25% Key Hires ⇾ 20% Operational
The kitchen is the heart of the home. It's a quintessential gathering place where families and friends come together to break bread, be merry, and make memories. But the kitchen is also where tragedy often strikes due to misuse of appliances. Kent McClure and his team set out to make the kitchen a safer and more energy-efficient place for the family after a tragic fire struck his own kitchen in late 2012. Thankfully, no lives were lost and everyone in his family made it out safe and sound, but Kent couldn't help but wonder “what if.”
With decades in the industrial design space, Kent knew he had the knowledge and the industry contacts to set out to improve upon home automation devices for the kitchen with a solution that not only made homes safer but also cut down on energy consumption and associated costs. In early 2013, Culina was born. Since that time, Kent and the Culina team have made it their mission to completely revolutionize the home automation and IoT space with innovative, AI-powered technology.
Kent McClure | Founder & CEO Kent is a Carnegie Mellon graduate with over 10 years of executive leadership experience in industrial design and engineering. He has a successful entrepreneurial history, founding a prior tech-based startup which he grew to $100 million in revenue, followed by an acquisition in 2010 and then IPO shortly after.
Sherri Carlson | COO Sherri earned her MBA from Harvard Business School. She oversees all of Culina's ongoing operations and procedures and is responsible for driving Culina to achieve and surpass sales, profitability, cash flow, and business goals and objectives.
Martin Frink | CTO Martin is a Stanford University alumnus with extensive technical expertise and over a decade of experience at venture-backed tech companies. He is responsible for Culina's technical vision, heading up all aspects of our technological development, strategic direction, development, and future growth.
Margaret Burns | CFO Margaret earned her degree in Financial Management from NYU. Prior to joining Culina, Margaret spent seven years as CFO for a publicly-traded mobile tech company headquartered in Silicon Valley. She currently manages Culina's financial risks and handles all financial planning, record-keeping, and reporting.
Market opportunity.
An enormous need exists for dramatic reductions in energy consumption. Businesses alone consume 12-20% of the total US energy supply on food production, processing, manufacturing, distribution, and preparation.
On the residential side, the Energy Information Administration estimates that the average US household uses 11,280 kWh per year. Many homeowners are simply unaware of the large amount of energy consumed by many small household kitchen appliances:
Dishwasher: 133 watts Television: 1,200 to 2,400 watts Coffee Maker: 900 to 1,200 watts Washing Machine: 350 to 500 watts Toaster: 55 to 250 watts Window Fan: 800 to 1,400 watts
The majority of US households now spend roughly 35 percent of their energy consumption on appliances, electronics, and lighting.
Most homeowners don't think about the little details that can help save them money on their energy bill. The vast majority of people keep the refrigerator or freezer too cold, fail to make sure refrigerator door seals are airtight, neglect to regularly defrost fridges and freezers, overload their dishwashers, and keep dishwasher water temperature too hot. As a result, energy consumption remains high, and energy bills remain high.
Not only do kitchens represent a primary source of household energy consumption, but also a primary source of house fires. More fires start in the kitchen than in any other room in the home, and household cooking appliances frequently account for billions of dollars in fire-related insurance claims every year. The number one cause of house fires and house fire injuries is the stove.
✓ 46% of house fires caused by cooking equipment ✓ 62% of house fires caused by ranges or cooktops ✓ $4,000 average fire and smoke damage repair costs
Culina is actively solving both of these common challenges caused by cooking equipment simultaneously. Our technology provides homeowners with immediate, real-time insight into their energy consumption by aggregating data for all kitchen appliances connected to our Smart Plugs while also delivering the preventative intelligence necessary to reduce kitchen-related disasters.
We designed our Culina Smart Plugs to work in tandem with an intuitive, user-friendly mobile application — allowing users to gain a much-needed technological upgrade to the most popular room in the house.
Culina Smart Plugs work with standard two and three-pronged appliances and cooking devices. Simply attach the Culina Smart Plug to the appliance's electrical, plug it into the wall, download the Culina app, connect, and configure.
Powered by machine learning artificial intelligence, our Intelligent Culina Response System learns user habits every time someone uses an appliance connected to one of our Smart Plugs.
Our state-of-the-art sensors detect a variety of potential threats to the kitchen — including sudden and unusual temperature fluctuations, poisonous gas and emissions, toxic smoke, and more. Homeowners receive alerts whenever unusual activity is in progress such as a stovetop being left on for too long or during an unusual time of day.
Users can monitor all information directly from an easy-to-navigate dashboard in real-time using the Culina App for iOS and Android. Users can check metrics such as fridge and freezer temperature, cook time, and usage data as it is being gathered.
With the Culina App, users can control all connected appliances and devices. If our Smart Plug is attached to a crockpot, for example, a user can add the ingredients before they head to work, activate the crockpot remotely, and come home to a readymade meal waiting for them the moment they step through the front door.
Not only does remote operation over appliances provide convenience, it also serves to prevent kitchen-related hazards. The Culina App includes auto shut-off capabilities allowing users to turn off appliances using their smartphone even when they're not at home. This is particularly useful in the event that users forget to turn off the oven or stove to prevent potential house fires.
In addition to notifying users if an appliance is left on by accident or if it detects a potential hazard, Culina also reminds users anytime regular maintenance is required.
Users can also monitor energy consumption on a weekly basis right from the Culina App. By providing at-a-glance insight into whether energy use has gone up or down, users gain the ability to adjust their usage accordingly in order to conserve energy and ultimately save money in utility bills the long term.
Our cloud-based technology integrates with other popular platforms including Google's Nest and Lowe's Iris.
Not only can users conserve money in energy consumption bills with Culina, but new insurance guidelines also provide significant discounts for homeowners who deploy smart technologies in their homes.
Culina will initially monetize from hardware sales.
Our product will sell for $149 MSRP with approximately 40% profit margin. We will initially sell our product through popular e-commerce platforms and through our website — followed by brick-and-mortar outlets including Lowe's, Best Buy, Home Depot, and other major big box retailers.
With much of the heavy lifting already completed, Culina has laid the groundwork for rapid expansion going forward. Here's an overview of our accomplishments since first founding the company in 2013.
Our first-generation product is market-ready and primed for commercial manufacturing. We have pre-sold 10,000 units, representing approximately $1,890,000 in pre-launch revenue. Our immediate customer base growing by the day and we have successfully proven that this is a product that consumers want and are enthusiastic about.
We have secured a total of $5 million in funding from angel investors, founder capital, friends and family, and VCs.
We have applied for and have been granted a provisional patent for our Smart Plug technology.
We are in the process of building relationships with notable industry leaders, influencers, and development teams in the home automation sector. We are also in advanced-stage partnership discussions with a number of major name insurance providers.
Culina has received coverage in many of today's most renowned tech and entrepreneurial publications, including The Wall Street Journal, The Huffington Post, TechCrunch, The Verge, WIRED, and Engadget, among others.
A US-based contract manufacturer has been secured and is ready to begin production with the capacity to produce around 50K units per month as we scale.
Our initial focus on the consumer space with our launch product is just the first step in our long-term roadmap to growth. In order to capture a larger market share and continue scaling the company exponentially, we are planning on rolling out a B2B model in the future. This will provide Culina with new revenue streams and will offer a valuable, tech-driven solution for businesses.
Commercial kitchens consume a huge amount of energy — roughly 2.5 times more per square foot than any other commercial space, according to the EPA.
The Foodservice Consultants Society International (FCSI) estimates commercial kitchen equipment is often only 50% efficient. The challenge with reducing energy consumption in commercial kitchens is that it's neither practical nor affordable to replace all kitchen equipment or redesign entire workspaces.
In an effort to reduce CO2 emissions, some governments are offering incentives to businesses that can cut back on their carbon footprint. In the UK, Enhanced Capital Allowances allow businesses to benefit from 100% tax relief on their qualifying capital expenditure on energy-saving equipment. This can provide a cash flow boost and an incentive to invest in energy-saving equipment which normally carries a price premium compared to less efficient alternatives.
Our 2nd generation product will represent a revenue-generating and energy-saving solution for commercial kitchens where equipment is frequently selected based on low capital cost with little regard to whole life-cycle cost and the resulting negative energy consumption.
Built on cloud computing, machine-to-machine communication, and information-gathering sensors, the Internet of Things market is rapidly making more and more commonplace devices “smarter.” Factor in the increasing prevalence of smartphones and tablets, and home automation and IoT products are now becoming much easier to use and significantly more affordable than they have ever been before.
What was once only reserved for the wealthy and tech-savvy, everyday consumers now have direct access to and can take advantage of a growing number of home automation devices. The evolution of the Internet of Things has enabled consumers to digitally connect and remotely control everything from their door locks to their thermostat to their garage opener and essentially everything else in between. Evidence of the enormous impact home automation tech has had in the consumer space can be seen in the enormous adoption of products like Nest and Amazon Echo.
The home automation market and Internet of Things (IoT) space is a thriving industry with growth expected to exceed $50 billion by 2020. This represents an estimated 300% increase from today's market of $12.5 billion. Around 8.4 billion connected devices will be installed globally by the end of 2017, representing a +31% increase in just one year. Around 63% of these devices will be used by consumers, with the remainder deployed by businesses.
Culina is perfectly positioned to capitalize on a major multi-billion dollar market opportunity to provide greater protection, actionable intelligence, lower energy consumption, and more cost savings to the millions of homes in the US.
We are directly targeting three specific target populations for our product:
Homeowners are our end users and will benefit the most from our product. For homeowners, Culina represents safety, peace of mind, increased convenience, and an economically-wise investment that pays for itself over time.
Including apartment complexes and student housing owners. Culina offers increased owner ROI, occupant satisfaction, and significantly lower operational and maintenance costs.
By reducing home fires caused by unattended cooking and the resulting billions of dollars in related insurance claims filed every year. Insurance companies can also leverage our technology to adjust homeowners insurance policy pricing.
Culina has carefully developed a diverse marketing plan intended to keep our brand in the hearts and minds of our existing and prospective customers, enabling us to continue expanding our reach and grow our business. Between our massive social network followings and email database contacts, we regularly communicate directly with over 100,000 consumers.
We will drive traffic and conversions to our website using social media marketing via Facebook, LinkedIn, Twitter, Instagram, Snapchat, YouTube, and others. We are also exploring SEO and SEM.
We consistently release marketing content through our blog that aims to educate our audience about the value that our product provides. Our content marketing efforts aim to influence and persuade readers without having to rely solely on conventional direct selling tactics.
We will launch an initiative to guest blog articles and features in IoT, home automation, and startup tech publications like TechCrunch, Wired, VentureBeat, and other outlets in our industry.
Primary competitors for Culina include other companies that are currently operating in the home automation and Internet of Things space, such as Nest Labs, Amazon Echo, and Wallflower Labs.
Leading home automation company Nest introduced its first product, Nest Learning Thermostat, in 2011. The company was founded in 2010 by former Apple engineers Tony Fadell and Matt Rogers and is headquartered in Palo Alto, California. Nest was acquired by Google on January 14, 2014, by Google for $3.2 billion and still operates under its own brand identity.
Nest Labs designs programmable, self-learning, sensor-driven, Wi-Fi-enabled thermostats, smoke detectors, and other security systems.
The 3rd generation Nest Thermostat prices at $249; Nest Indoor and Outdoor Cams are $199; and their Smoke & CO Alarm retails for $99.
Key Weaknesses:
After Nest's acquisition, the company has underperformed in sales and fallen below the expectations that Google set for them when it purchased the startup.
Amazon Echo, also known as Alexa, is a voice command device powered by artificial intelligence and designed by mega online retailer Amazon.com. The smart home hub was initially released in November 2014.
Alexa is a voice-activated virtual assistant housed within the Echo smart speaker. Users simply say her name and then ask a question or give a command.
The Amazon Echo retails for $99 for Amazon Prime members and $170 for everyone else.
However, some users have noted the uneven sound quality and limited “skills” capabilities. Users can also only interact and communicate with Alexa in English and German.
Founded December 1, 2013, Wallflower Labs is a Charleston, MA-based startup that designs an internet-connected smart plug that works with any freestanding plug-in electric stove. The company's founder previously founded Yap — a speech recognition technology that was acquired by Amazon in 2011 to help develop Alexa. The startup has raised a total of $2.5 million from three rounds of equity funding to date, with the most recent funding reported at $1.5 million via a convertible note on August 30, 2016.
The smart plug sounds an alarm and alerts homeowners via smartphone when the stove is turned on, someone forgets to turn it off, when a cooking time expires, or the smoke alarm activates.
Because Wallflower Labs are still in the pre-launch phase, the company has not yet publicly released consumer pricing information.
Unlike Culina, which connects with all smart appliances and cooking devices in the kitchen, Wallflower Labs is solely focused on monitoring stove usage.
Culina maintains a unique competitive advantage over other existing home automation and IoT products in several categories. Our biggest differentiators include:
Culina makes it possible to gain an across-the-board view from an entire network of interconnected devices. Whether they're connected to the refrigerator, gas or electric-powered stove, microwave, or dishwasher, our Smart Plugs can deliver insight into everything from smoke and gas detection, to temperature changes, and usage metrics — regardless of the brand and through a single, user-friendly app.
Our technology is easy to use and doesn't require any technical-savvy. Setup and configuration are simple, users are able to be up and running out of the box in approximately 10 minutes, and software updates are deployed over the air.
Culina is priced below our competitors' products while delivering superior functionality and value. This will be an essential factor in helping us continue to gain market share nationally.
Team Strength Our team is comprised of industry veterans who bring decades of experience to the table across industrial design, mobile tech, cloud-based technology, artificial intelligence, and more.
Our leadership team has a history of starting and leading companies to successful exits and has established valuable relationships with industry leaders along the way that will help us strategically position Culina as a market innovator in the days ahead.
Culina is currently seeking a total of $15M in Series B equity financing to fuel the next stage of company growth — including manufacturing, pre-order fulfillment, ongoing development of our platform, and marketing efforts in order to continue expanding the Culina brand. Any remaining funds will be allocated as operating capital.
Why Invest in Culina? With Culina, investors have the opportunity to get in on the ground floor with a company that's positioned to grow into a leading innovator in the home automation and IoT space.
With Culina, we've tapped into something truly extraordinary that's being celebrated by both early adopters and investors alike. With 10,000 units pre-sold and $1.89M in pre-launch revenue , we've already successfully demonstrated validation in the consumer space. With over $5 million in funding secured across several financing rounds, we've already proven that investors believe in our company, our mission, and our ability to succeed.
We've also established a scalable business model and robust product pipeline that will prime us for widespread expansion in the days ahead. We're now seeking investors who share our passion and commitment to pushing the boundaries of what home automation can be and do through nextgen technology.
We're looking forward to working with you in accelerating Culina's growth to become a dominant player in the booming global home automation and IoT industry.
We hope these business plan examples will get you started on the right path in getting your business idea into a full-on company. Keep in mind that these startup business plan examples are not a uniform guide for every business, and some information may vary. You may need a 5-year business plan template, or perhaps just some business plan examples for students. Make sure to remember this as you start writing your business plan, and comment below to let us know if these examples of business plans for startups were helpful in your startup journey.
For more helpful founder information: check out our podcast! The No BS version of startup life you've been looking for: Startup Therapy .
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Engineering Team
September 10, 2024
When was the last time you checked how many tools and applications your organization uses? If it’s been a while, we suggest doing this activity now.
You might realize that as the business landscape evolved, you added many new technologies and tools to keep up with the trend. Some of your older tools might no longer be in use, or worse, different teams might be using different paid tools for the same thing.
A technology roadmap ensures that this doesn’t happen.
A well-crafted technology roadmap serves as your North Star, guiding your organization through complex innovation and digital transformation. It’s a strategic blueprint that outlines your technology initiatives, aligns them with business objectives, and ensures efficient resource allocation.
In this blog, we’ll explain technology roadmaps and provide a step-by-step guide to creating one for your enterprise.
Types of technology roadmaps, step 1: identify strategic objectives, step 2: define goals , step 3: determine your roadmap’s audience and gather stakeholder input, step 4: establish the technology roadmap’s major themes, step 5: share the roadmap with relevant stakeholders, step 6: assign responsibilities and start making progress, step 7: regular assessment and revision of the technology roadmap, technology roadmap examples, the benefits of using a technology roadmap, create and manage your technology roadmap with clickup.
A technology roadmap or an IT system roadmap is a strategic document that outlines the technology solutions and initiatives an organization must implement over time to achieve its business objectives. It is a visual representation of your technology journey, highlighting key milestones, dependencies, and resource requirements.
By cataloging this journey, your technology teams and management can define a clear path forward, helping you align your investments with your long-term vision. A technology roadmap links your IT requirements and business goals, bringing your development, project management , and other teams on the same page.
A technology roadmap usually includes the following elements:
Given the constant evolution and changes in the technological landscape of an organization, a technology roadmap helps provide a strategic framework to update existing systems or tools and make them future-ready. A well-outlined technology roadmap is a critical tool to help you:
Depending on the specific goals and needs of your organization and team members, you may use varying tools within your organization. These can be classified based on the use case, including:
An IT roadmap or systems roadmap details the strategic planning and implementation of IT initiatives across an organization. It includes infrastructure upgrades, cybersecurity measures, software deployments, and other IT-related projects.
Software development teams, IT managers, and CIOs use an IT systems roadmap to ensure that the organization’s IT capabilities are aligned with its business goals and future-proof.
Also read : 10 Free Software Development Plan Templates to Use in 2024
The product roadmap is one of the most common types in this category. It deals with the company’s suite of software or products and outlines the key features, improvements, and technological advancements they will implement to meet customer needs and market demands.
It is particularly useful to product managers and development teams, as it helps to prioritize features and coordinate cross-functional efforts.
Here’s ClickUp’s own product roadmap that features on our website as well.
When technologies play a significant role in a company’s operations, a technology-specific roadmap serves an essential purpose. It guides the adoption and successful implementation of a particular technology within an organization, which can include emerging technologies like artificial intelligence (AI), blockchain, or the Internet of Things (IoT), to support specific business functions or processes.
A strategic roadmap or marketing roadmap provides a high-level overview of how technology initiatives will support the broader business strategy. It focuses on long-term goals, such as entering new markets, improving customer experience, or achieving operational excellence.
Executive leadership or marketing and sales teams often use these technology roadmaps to ensure that technology investments align with the company’s vision and growth objectives.
Once you’ve identified the type of technology roadmap that best suits your business outcomes, the next step is to start building it. Here’s how you can get started:
The first step in building a technology roadmap is to identify and clearly define your strategic objectives. These should be closely tied to your organization’s overall business goals and outline what you aim to achieve through your technology initiatives.
To help you identify the strategic direction for your technology roadmap, you should:
Consider ClickUp Docs to document all your strategic activities and goals in one document. This tool helps you consolidate your documents, wikis, and knowledge bases on one platform.
Using this specialized documentation feature, you can collaborate with other stakeholders in real time, connect documents to workflows and tasks, and securely share information with anyone on the internal team or outside.
Once you’ve identified your strategic objectives, it’s time to define specific goals. These should be more granular and provide a path to your broader vision . Here’s how you can turn objectives into action:
Define and monitor your goals using ClickUp Goals , a unique ClickUp feature that lets you add all your activities related to a particular goal, giving you a clear vision of the timelines, targets, and tasks.
This step ensures that everyone involved knows exactly what needs to be accomplished and how success will be measured.
A technology roadmap should be accessible to various stakeholders, including executives, IT professionals, and business users. Therefore, gather input from your internal teams to ensure that the roadmap aligns with their needs and expectations.
To effectively communicate and gather input from your teams, use the ClickUp Chat view . This feature allows cross-functional teams to easily collaborate and discuss their business priorities on a shared platform. By bringing all the scattered conversations under one roof, you can:
With your objectives and goals in place and stakeholder input gathered, the next step is to set up the major themes of your technology strategy and roadmap. These themes represent the overarching areas of focus that will guide your technology initiatives over time.
For example, if your technology roadmapping is focused on improving customer engagement, the theme of your technology implementation could be ‘Enhancing Customer Interaction Channels.’ Under this theme, you may include initiatives such as implementing a new CRM system, developing a mobile app, and integrating AI-driven customer support tools.
Once your technology roadmap is aligned with a particular theme, it is time to communicate it with all the relevant stakeholders. Sharing the roadmap allows everyone involved to see the strategic direction, understand their roles, and collaborate to achieve the outlined goals.
Securely share your roadmap with the relevant stakeholders with custom view and edit permissions in ClickUp.
To quickly understand and communicate project timelines, you may even use the ClickUp Gantt Chart view , which lets you build Gantt charts using its powerful drag-and-drop feature. This allows you to visualize project workflows, track activities in real time, and manage dependent tasks using a simplified view.
With the roadmap shared and understood by all key stakeholders, it is time to allot responsibilities and implement the initiatives. Clearly defined roles and responsibilities ensure that the technology roadmap is executed efficiently and that progress is made according to plan.
You can use a process mapping tool like ClickUp to break down initiatives into actionable tasks, set deadlines, and monitor progress. With ClickUp Tasks features you can assign tasks to team members, set priorities, and track completion status, ensuring that everyone knows what they need to do and by when.
Technology roadmaps are not just a one-time affair but living, breathing documentation that needs continuous updates and monitoring. As business operations evolve, technology advances, and new challenges arise, you should update your roadmap to reflect these changes. To continuously monitor and update your roadmap, you should:
To gather the information for these reviews, consider software development project management tools like ClickUp, which provides live reports and dashboards. ClickUp Dashboards provides a 360-degree view of your entire project and priorities, offering a customizable view of all the key metrics and information. This allows you to identify areas requiring attention and make data-driven decisions quickly.
With the ClickUp Kanban Board , you can create an end-to-end visualization of your tasks. Customize columns, drag tasks through different phases, and add subcategories and blockers to track processes in the Kanban board. This is a great way to easily share updates with your team while each team member understands how their activity impacts the overall project.
Now that we’ve covered the process of creating technology roadmaps, let’s also see how to manage this quickly and efficiently.
ClickUp offers several roadmap templates to help you get started quickly and efficiently. Each template is designed to cater to specific needs, ensuring that your technology roadmap is both comprehensive and tailored to your organization’s goals.
If you need generic or marketing technology roadmaps , the ClickUp Project Roadmap Template is apt for your needs. This template provides a clear overview of project timelines, milestones, and deliverables, helping you keep everything on track.
This roadmap template can help you with:
Also read: Free Project Roadmap Templates in Excel & ClickUp
For IT and development teams, ClickUp’s Technology Roadmap Template is the ideal option for planning all technology initiatives over a defined period. This template provides a structured layout for organizing and visualizing technology projects, from initial planning stages to final implementation.
Thus, the template is perfect for:
Also read: 10 Free Technology Roadmap Templates for Better Team Alignment
ClickUp Agile Team Roadmap Template is specifically designed for teams that follow Agile methodologies. This template helps you outline your Agile projects, track sprints, and manage backlogs, all within the context of your overarching technology roadmap.
You can leverage this template for:
The ClickUp IT Teams Roadmap Template is tailored for IT departments looking to plan and manage their technology infrastructure and initiatives. It allows you to outline the critical IT projects that support your organization’s operations. Use it for:
By laying out a clear path for technology initiatives, a roadmap aligns the entire organization toward shared objectives, optimizes resource allocation, and enhances communication among stakeholders. This provides the following benefits:
In a world where technology evolves at lightning speed, having a well-defined technology roadmap is crucial for staying ahead of the curve. It helps you plot a defined path for your tech initiatives that aligns perfectly with your strategic objectives and organizational goals.
ClickUp offers a comprehensive suite of tools, templates, and roadmap software features to help you build and manage your technology roadmap. With it, you can streamline your roadmap creation, enhance team collaboration, and ensure that your technology projects are set up for success from the start.
Ready to take your technology roadmap to the next level? Sign up to ClickUp today and achieve meaningful results with your technology roadmap.
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A technology business plan is a plan to start and/or grow your technology business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections. You can easily complete your Technology business plan using our Technology Business Plan Template here.
Establish technology as a differentiator, when it is. Tell me about it in relation to its importance to the business. Don't force me to understand it when I don't need to. On the other hand, as a writer, manager, and user of business plans as tools for steering a business, I believe you should discuss your technology in the plan for any ...
Marketing Plan. Traditionally, a marketing plan includes the four P's: Product, Price, Place, and Promotion. For a technology business plan, your marketing plan should include the following: Product: In the product section, you should reiterate the type of technology company that you documented in your Company Analysis.
By including the seven elements below, you'll have a plan that gives your company a much stronger footing. 1. Executive Summary. The executive summary is, without a doubt, the most critical element of your tech startup business plan. Despite this, a lot of plans fail here because the summary doesn't captivate readers.
1. Begin your company overview section by describing what your business specializes in and the technology behind it. This part of the company overview is intended to give readers and investors a general idea of your business. 2. Next, proceed to explain the nature of the industry and marketplace. 3.
Traditionally, a marketing plan includes the four P's: Product, Price, Place, and Promotion. For an IT business plan, your marketing strategy should include the following: Product: In the product section, you should reiterate the type of IT company that you documented in your company overview.
Position your technology venture at the forefront of innovation with our comprehensive selection of technology industry business plan examples. This invaluable resource is engineered for entrepreneurs, startup founders, and IT leaders seeking to navigate business planning in the fast-paced tech landscape. The plans presented provide a ...
Our array of business plan examples cover various technology business types, including software development companies, hardware manufacturers, IT service providers, and tech startups exploring emerging fields like AI and blockchain. Each plan is carefully constructed to address key components such as market analysis, technological innovation ...
Each technology business plan template below is crafted to guide you through every essential section of your business plan: the Executive Summary, Company Overview, Industry Analysis, Customer Analysis, Competitive Analysis, Marketing Plan, Operations Plan, Management Team, and Financial Plan. We understand the unique challenges and ...
Traditional business plans are long, comprehensive and difficult, and they take a long time to prepare. It is a task that will require the development of assumptions and projections based on vision, objectives, market conditions, and competitive analysis. This article aims to outline how you can modernise your business. Written by.
Follow these tips to quickly develop a working business plan from this sample. 1. Don't worry about finding an exact match. We have over 550 sample business plan templates. So, make sure the plan is a close match, but don't get hung up on the details. Your business is unique and will differ from any example or template you come across.
Generally, most business plans typically include a summary of the company history, the problem it is solving, the target audience, competitive analysis, the marketing and sales strategy, the development strategy, and the financial plan. Also, such a document may include details about the management team, operations, and product development roadmap.
A Sample IT Tech Startup Business Plan Template. 1. Industry Overview. An IT technology company (often tech company) is a type of business entity that focuses on the development and manufacturing of technology products, or providing technology as a service. "Technology", in this context, has come to mean electronics-based technology.
ASP B2B Technology Business Plan; ASP Software Developer Business Plan; Computer Programming Business Plan; Computer Software Business Plan; ... Start your plan off on the right foot by browsing these sample business plans for computer repair, computer consulting, data recovery, computer support, I.T., computer engineering, and a number of ...
Customers are the most important stakeholders of any organization. Digital transformation (DT) helps businesses provide an excellent customer experience and serve them better. DT helps to facilitate through connecting the customer data across the organization in one source. 5. Decreased Operating Costs.
Marketing plan: A strategic outline of how you plan to market and promote your business before, during, and after your company launches into the market. Logistics and operations plan: An explanation of the systems, processes, and tools that are needed to run your business in the background. Financial plan: A map of your short-term (and even ...
Here are five steps to achieve effective IT strategic planning and execution: 1. The alignment phase: IT strategy is part of your business strategy. While IT strategic planning focuses on medium-term goals, CIOs must consider the realm beyond their IT environment (i.e., your company goals).
OFFERING: SME IT Strategic Plan Template. This free IT strategic plan template spells out simple yet effective procedures for aligning IT strategy with your company's strategic objectives and initiatives. It is designed for small and midsized enterprises. (Registration is required and can take a few minutes to gain access.)
You can use internal business plans to share goals, strategies, or performance updates with stakeholders. In my opinion, internal business plans are useful for alignment and building support for ambitious goals. 4. Strategic Initiatives. A strategic business plan is another business plan that's often shared internally.
2.2 Start-up Summary. Our start-up costs will be $1M, which includes $450,000 for the acquisition of the Maui and Hilo operations of Servco Integrated Office Technology. The remainder of the funds will be used for: Initial Inventory: $200,000. Initial Capitalization: $225,000.
You may also see e-commerce marketing plan examples. So if you're hoping to launch a tech startup anytime soon, here are a few tips on how you can create an effective business plan: 1. Have a clear objective. Set a clear objective that's anything but ambiguous. You need to be specific about what you hope to achieve.
You may need a 5-year business plan template, or perhaps just some business plan examples for students. Make sure to remember this as you start writing your business plan, and comment below to let us know if these examples of business plans for startups were helpful in your startup journey. For more helpful founder information: check out our ...
Details. File Format. PDF. Size: 2 MB. Download Now. A business plan for an information technology services company involves a lot of things. It requires your assets, needs, desires. You need to flush it out, as it were. How many computers will your need for the business, also, who will need the highest level of tech.
2. Product roadmap. The product roadmap is one of the most common types in this category. It deals with the company's suite of software or products and outlines the key features, improvements, and technological advancements they will implement to meet customer needs and market demands.. It is particularly useful to product managers and development teams, as it helps to prioritize features ...