Start-up Funding | |
Start-up Expenses to Fund | $16,450 |
Start-up Assets to Fund | $103,550 |
Total Funding Required | $120,000 |
Assets | |
Non-cash Assets from Start-up | $93,750 |
Cash Requirements from Start-up | $9,800 |
Additional Cash Raised | $0 |
Cash Balance on Starting Date | $9,800 |
Total Assets | $103,550 |
Liabilities and Capital | |
Liabilities | |
Current Borrowing | $95,000 |
Long-term Liabilities | $0 |
Accounts Payable (Outstanding Bills) | $0 |
Other Current Liabilities (interest-free) | $0 |
Total Liabilities | $95,000 |
Capital | |
Planned Investment | |
Investor 1 | $25,000 |
Other | $0 |
Additional Investment Requirement | $0 |
Total Planned Investment | $25,000 |
Loss at Start-up (Start-up Expenses) | ($16,450) |
Total Capital | $8,550 |
Total Capital and Liabilities | $103,550 |
Total Funding | $120,000 |
The Coffee Warehouse will provide a first-class delivery service of quality hot and cold beverage related supplies, including whole bean or ground coffee, flavor syrups, jet teas, fruit smoothies, bubble teas, concentrated milk, fresh baked goods and assorted paper supplies. Our services will include invaluable trade resources, effective promotional programs, custom-designed marketing material, informative monthly newsletters, training and product demonstrations, as well as information on the latest market trends in the coffee/specialty beverage industry.
PRODUCT DESCRIPTION The Coffee Warehouse will carry a variety of quality products that will enable us to provide full service delivery to espresso stands and coffee houses. Our underlying philosophy in selecting products is to choose lines that will bring consistent quality, competitive prices, and product satisfaction to our customers. We have personally researched and sampled each of the following products that we offer to ensure the quality we guarantee.
At this time, the majority of these products are only available to customers through wholesale vendors such as Cash and Carry retail outlets – therefore it is the customer’s responsibility to acquire these products by their own means. The Coffee Warehouse will make these same products available through our high quality, full service delivery – bringing these products directly to their doorstep at a competitive price.
KEY COMPETITIVE STRENGTHS No other wholesaler in the market offers full service delivery with the variety of product we feature. We are better positioned than our main competitors to take advantage of the increasing demands of coffee and specialty beverage supplies because we focus exclusively on high-quality distribution and customer service. In addition to the variety of products we feature, The Coffee Warehouse has exclusive distribution rights to Good Cow’s concentrated milk/dispensing system. This product is not currently available in our market by any other suppliers.
KEY COMPETITIVE WEAKNESSES Our primary weakness is that we are a new business competing largely against established suppliers. To significantly build sales, we must not just find new customers – we must take customers away from existing suppliers. However by offering a superior selection of supplies, new groundbreaking products to the market, and focusing on high-quality service and full service delivery, we feel will can quickly establish accounts and build strong relationships. Co-founder Jennifer Smith has had many discussions with owners of coffee and espresso businesses that confirm this opinion.
Sales literature to be distributed to both current and potential customers will include brochures, fliers, newsletters, as well as other print media such as print advertisements. Jennifer Smith is highly skilled in graphic design and desktop publishing, and has quality design and printing equipment to publish professional pieces at a low cost.
The Coffee Warehouse will purchase product directly from manufacturers, as well as master distributors. Because this eliminates the broker or “middle man,” this allows us to operate on a 25-30% profit margin, while providing our customers with competitive prices.
To further reduce costs, The Coffee Warehouse plans to share product shipments out of California with distributors operating in Portland, Oregon and Tri-Cities, Washington. Other product not being shipped directly to Spokane will be purchased and picked up in Seattle, Washington. The Coffee Warehouse plans to send a truck to Seattle on a bi-weekly basis to pick up product, thus cutting costs by an average of 5%.
To streamline the efficiency of our distribution methods, The Coffee Warehouse plans to use the latest in cutting edge technology – not only in the warehouse – but also in the trade.
All of our drivers/sales representatives will be equiped with Thinque MSP handhelds and software. Thinque MSP applications will reduce field expenses, decrease day’s sales outstanding, and increase worker efficiency. Features can be used in or out of the warehouse and include managing returns and collections; adjusting item price, profit or margin; applying promotional items to an account; streamlining orders; tracking inventory; reducing out-of-stocks; and providing sales history reports. All information recorded in the handheld is available in real time to be viewed by management in the office.
Within the first year of business, The Coffee Warehouse intends to open a retail/wholesale store and high-quality showroom. Products will be available for purchase by both our wholesale customers who may need product between delivery days, as well as retail consumers interested in purchasing product for their home use. We will also offer a showroom that will feature equipment, supplies, trade resources, and information on marketing services with examples of marketing and promotional material available to customers.
With the addition of the product showroom, The Coffee Warehouse will offer customers quarterly product and training demonstrations that will be presented by trained beverage experts from the industry.
The Coffee Warehouse also plans to hold semi-annual trade shows for current or potential customers. These trade shows will allow customers the opportunity to sample products, talk to manufacturers, learn about new industry trends, review marketing material, and network with other business owners in their market.
Coffee is the second largest commodity market next to oil, and growth is expected to continue at a strong pace for the foreseeable future. The specialty beverage industry is growing at an equally strong pace, with sales growth in some categories projected to grow at rates of 40% per year.
This growth offers excellent opportunities for new companies to enter this market, and we are excited about the possibilities of what The Coffee Warehouse can accomplish in the Spokane and Northern Idaho market.
The gourmet coffee and specialty beverage industry is divided into several segments. Consumers who enjoy these products purchase drinks at restaurants, coffee houses, sports venues, drive-thru espresso stands, and even inside other retail establishments that might feature an independent beverage stand.
As illustrated in the chart below, within the market surrounding Spokane, Rathdrum, Post Falls and Coeur d’Alene, there are currently 250 drive-thru espresso stands, 18 coffee/tea houses, 52 independent inner-retail espresso stands, and approximately 10 stands in locations such as sports venues, university campuses, and etc. These figures are not including the number of restaurants, bars and cafes that also feature these beverages.
Market Analysis | |||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |||
Potential Customers | Growth | CAGR | |||||
Drive-thru Espresso | 4% | 250 | 259 | 268 | 277 | 287 | 3.51% |
Inner-Retail Espresso | 4% | 52 | 54 | 56 | 58 | 60 | 3.64% |
Coffee/Tea Houses | 5% | 18 | 19 | 20 | 21 | 22 | 5.14% |
Other (sports venues, universities, etc) | 5% | 10 | 11 | 12 | 13 | 14 | 8.78% |
Total | 3.79% | 330 | 343 | 356 | 369 | 383 | 3.79% |
While the market is already sizeable, this industry continues to grow. New espresso stands open their doors to the public on a monthly basis in our market, and it isn’t uncommon to see numerous espresso stands within a one or two mile radius. The article below, published by a national coffee retail magazine, discusses our market’s unique drive-thru espresso industry. The sales potential in this market is unlimited.
The Coffee Warehouse initially plans to target these drive-thru espresso stands, as well as all inner-retail espresso stands within our designated market. It is this segment that is most in need of the services we are planning to offer. Essential needs include: quality products at competitive prices, first class service, and strong sales support. It is most often these small owner-operated businesses that are neglected by larger suppliers and are forced to service themselves. It is also these smaller businesses who could most greatly benefit from marketing services, sales support, and full service product delivery. Providing the same high-quality service, within the first six months of operation, The Coffee Warehouse plans to expand our target into formal coffee houses and cafes, and as business grows and stabilizes, eventually evaluate the needs of potential customers in the restaurants and bar industry.
Coffee has been a growing industry for the past several years. In the gourmet/specialty coffee industry alone, the figures show an impressive rate of growth in the United States.
Bubble Tea has been a rapidly growing market in Asia, though it is relatively new to the United States. Introduced to trend setting marketings such as San Francisco and Seattle, sales have been exploding – and the craze of the “Tapioca Pearl” is expected to spread throughout America.
The coffee and specialty beverage industry is pulverized, with hundreds of manufacturers, brokers, suppliers and retailers. Unlike the beer/soda industry, with large companies such as Anheuser Busch, Pepsi and Coca Cola controlling most of the market, the coffee and specialty beverage industry does not have large national chains with market control.
In an open industry growing at such a strong rate, The Coffee Warehouse is in position to capitalize on the customer’s need for quality product, exceptional service, and an effective partner to success.
With the rate of growth in the gourmet coffee market, in addition to the recent trends in Jet Teas and other specialty beverages, the industry is comprised of many small participants, each focusing on only a few specific items or brands at a time. As the markets evolve, we expect the industry to consolidate with larger distributors representing more of a vast selection of products in each market.
Currently in our segment of the industry, there are no large national chains with market control. There are also few products that are offered with exclusive rights to one market. While this is the case with many products, The Coffee Warehouse is working with manufacturers to change that practice, and not only represent a larger variety of product than others in our industry, but also acquire exclusive rights to many of the products in our portfolio.
The following flow chart illustrates the overall industry surrounding the distribution patterns of coffee and specialty beverages. (The Coffee Warehouse falls into the level highlighted in yellow).
Several manufacturers are represented by master distributors and/or brokers who in turn provide the product to direct distributors and other wholesale suppliers. Other manufacturers allow distributors and suppliers to purchase product direct – depending on the quantity of product being purchased. Product is then distributed or sold through cash and carry wholesale stores to retail businesses as illustrated below.
While there are a handful of coffee and specialty beverage suppliers providing product in our market, there is still a great deal of room for new business. Most importantly, there is room for new business that understands the need for high-quality service and sales support – in addition to product at competitive prices.
In this industry, customers choose their suppliers based on available product, price, and service – though most often, it is the service that suffers most. While one supplier may offer the product at the right price, they do not provide the level of service that the customer demands. The next supplier may offer the right level of service, though their prices are too high. This results with the customer purchasing most of their supplies through a cash and carry style wholesale store – leaving the customer with no service or support.
By positioning ourselves in the market with in-demand, quality product at competitive prices, with a consistent high level of customer service – we are confident that we will see customers and their business continue to increase.
The unique aspects of our business include individual product selection, quality assurance, and high-quality full service distribution. Our strategy is to focus 100% of our efforts on the market for espresso supplies in the Spokane and Northern Idaho area. By focusing all of our effort and energy on this particular area, we expect to quickly develop and maintain a leadership position. The Coffee Warehouse’s key personnel will stay in contact with our customers, and will be able to respond to changes in this market much faster than our competitors.
The Coffee Warehouse will offer the best, most highly personalized service in the marketplace. Being a small, owner-operated company, we intend to use this to our advantage to be absolutely certain that every one of our customers receive excellent service. We will go out of our way to make sure that our customers know that they truly matter to us. Sales reps and in-house personnel who deal with customers will be carefully trained and given wide latitude for insuring that customers are always satisfied.
Our basic marketing strategy is to work with customers on a one-to-one basis to ensure their supply needs are being met and help develop unique marketing programs for each of them. We intend to prioritize customer service and make it a key component of our marketing programs. We believe that providing our customers with what they want, when and how they want it, is the key to repeat business and positive word-of-mouth advertising. Because we want to develop close working relationships with our customers, we want to establish accounts in as personable a way as possible. It is for this reason that we will overwhelmingly emphasize in-person sales calls to build accounts.
We will closely integrate all of our marketing and sales efforts to project a consistent image of our company and a consistent positioning of our products and services. We will build this image around our name “The Coffee Warehouse, Inc.” and emphasize to customers the high-quality service that is behind this name.
To support our marketing initiatives and product knowledge, we will attend as many area conventions and trade shows as possible to ensure we are offering the most up-to-date market trend information.
Relationships are the key to success in the distribution business. Personal selling will remain our most important means of promotion. Both Steve and Jennifer Smith will lead this effort – Steve, with his skill and experience in sales and distribution, and Jennifer in customer service and relations. In addition to personal selling, The Coffee Warehouse has identified several other means of advertising and publicity.
The Coffee Warehouse will send news releases to local media and press, as well as trade magazines to try to get product and company feature coverage in front of the eyes of our customers – as well as the end consumer. We will also produce a few generic press releases about the products we are distributing for our customers to use toward publicity coverage for their businesses in local publications such as the Spokesman, The Inlander and Local Planet.
Third, we shall have a monthly newsletter for current of potential customers. This newsletter will highlight new and current trends in the industry, upcoming conventions and trade shows, offer promotions and special deals, as well as provide new recipes, fun tips and other information that can be used in their business. We will also highlight not just our products, but also display ideas and success stories of other business in the industry. As a more straight forward advertising effort, The Coffee Warehouse will feature an advertisement in the Yellow Pages, frequent ads in the Spokesman Review, the Inlander, and the Local Planet, as well as participation in networking, local trade shows, and personal word-of-mouth advertising.
5.4 sales strategy.
Distribution sales are dependent on repeat business, therefore the sales strategy for The Coffee Warehouse is based on personal, consistent sales contact, with a high emphasis on customer service and relations. Because we are a new distributor, we understand that we will have to prove our worth to our customers in order to earn their respect and business. Both of the owners, Steve and Jennifer, will make personal calls on potential customers to review our product line and services, give general information on our company, and discuss how we feel we can help them succeed in their business.
The Coffee Warehouse will begin operations with two full-time delivery/sales representatives, who will be responsible for providing full service and delivery to current customers, but also make sales calls for potential new business. This delivery/sales representatives will receive a base salary, with commission on qualified sales, as well as bonuses for new acquired business. Customers will be scheduled for a pre-arranged delivery day once or twice a week, depending on the quantity and timeline of product needed. Product orders can be placed in a number of ways to help facilitate the process:
We understand the hectic schedule of a small business, so if a customer fails to call or fax their weekly order, they will receive a courtesy call from our office to verify that an order is not needed.
As indicated in the table, our sales are forecasted to increase rapidly, with an annual growth rate of approximately 30%.
Sales Forecast | |||
Year 1 | Year 2 | Year 3 | |
Sales | |||
Espresso Syrups | $415,362 | $477,666 | $549,316 |
Chocolate & Caramel Sauces | $275,852 | $311,713 | $352,235 |
Specialty Beverage Mixes | $176,660 | $203,158 | $233,632 |
Energy Drinks | $44,372 | $51,028 | $58,683 |
Concentrated Milk | $113,816 | $130,889 | $150,523 |
Paper Supplies | $1,185,285 | $1,363,078 | $1,567,540 |
Marketing | $18,305 | $21,051 | $24,208 |
Total Sales | $2,229,652 | $2,558,584 | $2,936,137 |
Direct Cost of Sales | Year 1 | Year 2 | Year 3 |
Espresso Syrups | $345,347 | $397,149 | $456,722 |
Chocolate & Caramel Sauces | $244,798 | $276,622 | $312,583 |
Specialty Beverage Mixes | $134,440 | $154,606 | $177,797 |
Energy Drinks | $36,542 | $42,023 | $48,327 |
Concentrated Milk | $97,919 | $112,607 | $129,498 |
Paper Supplies | $888,964 | $1,022,308 | $1,175,655 |
Marketing | $6,540 | $7,521 | $8,649 |
Subtotal Direct Cost of Sales | $1,754,550 | $2,012,837 | $2,309,230 |
The following table and chart are the important milestones for The Coffee Warehouse.
Milestones | |||||
Milestone | Start Date | End Date | Budget | Manager | Department |
Market/Trade Research | 3/15/2003 | 5/15/2003 | $150 | SDS / JLS | Marketing |
Logo Design/Marketing | 4/15/2003 | 5/15/2003 | $1,300 | JLS | Marketing |
Complete Business Plan | 4/15/2003 | 5/30/2003 | $90 | JLS | Marketing |
Product/Pricing Comparison | 4/15/2003 | 5/15/2003 | $150 | SDS / JLS | Marketing |
Finalize Potential Client List | 5/1/2003 | 5/15/2003 | $0 | JLS | Marketing |
Licensing/Incorporation | 5/15/2003 | 6/15/2003 | $200 | JLS | Marketing |
Secure Product Line | 5/15/2003 | 6/15/2003 | $0 | JLS | Marketing |
Research/Secure Financing | 5/15/2003 | 7/15/2003 | $0 | SDS / JLS | Marketing |
Warehouse Selection/Buildout | 5/15/2003 | 6/15/2003 | $0 | SDS / JLS | Marketing |
Leasehold Improvements | 7/1/2003 | 8/1/2003 | $5,000 | SDS / JLS | Web |
Delivery Vehicle Selection | 6/1/2003 | 6/15/2003 | $0 | SDS | Web |
Develop Routing | 6/15/2003 | 7/15/2003 | $100 | SDS | Department |
Hire Delivery/Sales Personnel | 7/1/2003 | 7/15/2003 | $100 | SDS | Department |
Office Equipment/Computer/Supplies | 7/1/2003 | 8/1/2003 | $5,000 | JLS | Department |
Order Beginning Inventory | 7/10/2003 | 7/20/2003 | $20,000 | SDS / JLS | Department |
Press Releases/Advertising | 7/1/2003 | 8/1/2003 | $250 | JLS | Department |
Organize Grand Opening Trade Show | 8/1/2003 | 8/10/2003 | $3,000 | JLS | Department |
Totals | $35,340 |
The Coffee Warehouse will be owned and operated by its founders, initially working with a small employee base that will cover sales and delivery. Management and personnel plans are covered in more detail in the topics to follow.
The Coffee Warehouse will be managed by the two founding partners, whose individual areas of expertise cover many of the functional aspects of the business.
The organizational structure is very simple. Steve Smith will be responsible for the routing, distribution management and delivery systems. Jennifer Smith will be responsible for customer service, accounting, shipping and the general administration of the business. Together they will be responsible for product selection and sales and marketing.
The support staff at the office and warehouse, as well as the delivery personnel will report to Jennifer. Because Steve will be spending a majority of his time in the trade, Jennifer will be able to support any day-to-day needs that the personnel may have. However even when Steve is out of the office, he will be in constant contact via computer or phone.
The goal of The Coffee Warehouse is to have a team of committed associates who empower each other so that the customer’s expectations can be exceeded. Our goal is to offer career opportunities, advancement opportunities and a level of income and benefits that is competitive within the region and job classification. It is our long-term goal to be the preferred employer within our niche of the beverage distribution industry.
Steven D. Smith Steve has a long history of experience in sales and distribution management, specifically in the beverage industry. As the sales and distribution manager for the largest beverage distributorship in the state, he currently manages ten sales representatives and twenty four merchandisers. During this time as sales manager, he has helped increase market share from 25 to 40%.
Over the last twenty years, Steve has successfully built and maintained rapport with buyers in the city’s largest key accounts, and has strategically routed sales, merchandising and truck routes throughout the city.
Steve has many industry contacts and an in-depth knowledge of the market.
Jennifer L. Smith Jennifer recently operated as general manager for a local business and directed a staff of thirteen, overseeing the accounting practices, human resource issues, and day-to-day operations of the company. Prior to this position, Jennifer has held a variety of other inside business management and operations positions.
Jennifer’s strengths and skills include strong management, excellent public relations, high levels of organization, extensive computer knowledge – including desktop publishing and graphic layout – and extensive presentation and reporting skills.
PERSONNEL – GENERAL Initially we expect to be able to handle business needs with Steve and Jennifer, one administrative assistant, and two product delivery/sales personnel. As business continues to grow, we intend to hire additional employees one at a time and pay premium, over market labor rates to attract and retain quality help.
Not only will we train our employees to deliver excellent service, we will give them the flexibility to respond creatively to client requests. In addition, we will continually monitor our clients’ level of satisfaction with our service through surveys and other convenient feedback opportunities.
To ensure our personnel are meeting our expectations, we will hold a minimum of quarterly meetings with all employees so that results can be reviewed and future plans can be discussed. At least twice a year, a refresher course will be required on product knowledge and how to exceed our customer’s expectations.
SALES AND DELIVERY In order to deliver high quality, personalized service we will carefully select all employees – with extra attention given to sales reps and delivery personnel who will deal directly with customers. We will carefully review references not just from past employers or manufacturers, but also from retailers whom these sales reps have served. We will also make sure that each employee understands our way of delivering quality service to each customer. We will have immediate back-up support available by phone from our office for more difficult service issues. We will also give employees enough latitude so that they can respond immediately to almost any customer request or complaint – which in this industry usually means granting immediate credit for damaged merchandise, and adding additional merchandise to an order.
Personnel Plan | |||
Year 1 | Year 2 | Year 3 | |
Jennifer Smith | $30,000 | $35,000 | $40,000 |
Sales/Delivery (Salary) | $20,400 | $21,500 | $22,500 |
Sales/Delivery (Commission) | $4,237 | $4,500 | $4,500 |
Delivery/Warehouse Personnel | $20,400 | $21,500 | $22,500 |
Administration | $18,720 | $19,500 | $21,000 |
Total People | 4 | 4 | 4 |
Total Payroll | $93,757 | $102,000 | $110,500 |
The Coffee Warehouse projects the gross margin to be at approximately 20-25 percent. Sales projections for FY2004 are at $2,229,652 increasing to $2,558,584 in FY2005 and $2,936,137 in FY2006. Cash-flow analysis, balance sheet, business ratio, break-even analysis, and other financial details are shown in the appendix.
General assumptions for this plan are on the following table.
General Assumptions | |||
Year 1 | Year 2 | Year 3 | |
Plan Month | 1 | 2 | 3 |
Current Interest Rate | 8.00% | 8.00% | 8.00% |
Long-term Interest Rate | 8.00% | 8.00% | 8.00% |
Tax Rate | 25.42% | 25.00% | 25.42% |
Other | 0 | 0 | 0 |
The following table and chart illustrate our break-even analysis. With our fixed costs estimate of approximately $15,000 per month, operating on average at a 25% profit margin, we will need to sell 67,666 units to break-even in a month. Fixed costs include our warehouse lease, vehicle leases, utilities, insurance, payroll, and an estimation of other running costs.
Break-even Analysis | |
Monthly Revenue Break-even | $75,055 |
Assumptions: | |
Average Percent Variable Cost | 79% |
Estimated Monthly Fixed Cost | $15,993 |
The following table and charts show the projected profit and loss. Monthly projections are included in the appendix.
Pro Forma Profit and Loss | |||
Year 1 | Year 2 | Year 3 | |
Sales | $2,229,652 | $2,558,584 | $2,936,137 |
Direct Cost of Sales | $1,754,550 | $2,012,837 | $2,309,230 |
Hidden Row | $0 | $0 | $0 |
Total Cost of Sales | $1,754,550 | $2,012,837 | $2,309,230 |
Gross Margin | $475,102 | $545,747 | $626,907 |
Gross Margin % | 21.31% | 21.33% | 21.35% |
Expenses | |||
Payroll | $93,757 | $102,000 | $110,500 |
Other | $0 | $0 | $0 |
Depreciation | $0 | $0 | $0 |
Rent | $33,096 | $34,260 | $35,460 |
Utilities and Phone | $7,200 | $7,500 | $7,800 |
Insurance | $6,000 | $6,300 | $6,500 |
Payroll Burden | $14,064 | $15,300 | $16,575 |
Leased Equipment (Delivery Vehicles) | $12,000 | $12,600 | $13,200 |
Leased Equipment (Warehouse) | $3,000 | $3,000 | $3,000 |
Leased Equipment (Other) | $2,400 | $2,400 | $2,400 |
Fuel (delivery) | $12,000 | $12,500 | $13,000 |
Advertising / Promotion | $3,600 | $3,600 | $3,600 |
Professional Services | $2,400 | $2,200 | $2,600 |
Miscellaneous (office supplies, etc) | $2,400 | $2,700 | $3,000 |
Total Operating Expenses | $191,917 | $204,360 | $217,635 |
Profit Before Interest and Taxes | $283,186 | $341,387 | $409,272 |
EBITDA | $283,186 | $341,387 | $409,272 |
Interest Expense | $6,560 | $4,720 | $2,800 |
Taxes Incurred | $69,354 | $84,167 | $103,312 |
Other Income | |||
Interest Income | $0 | $0 | $0 |
Other Income Account Name | $0 | $0 | $0 |
Total Other Income | $0 | $0 | $0 |
Other Expense | |||
Account Name | $0 | $0 | $0 |
Other Expense Account Name | $0 | $0 | $0 |
Total Other Expense | $0 | $0 | $0 |
Net Other Income | $0 | $0 | $0 |
Net Profit | $207,271 | $252,500 | $303,160 |
Net Profit/Sales | 9.30% | 9.87% | 10.33% |
The following table shows cash flow for the three years, and the chart illustrates monthly cash flow in the first year. Monthly cash flow projections are included in the appendix.
Pro Forma Cash Flow | |||
Year 1 | Year 2 | Year 3 | |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $2,229,652 | $2,558,584 | $2,936,137 |
Subtotal Cash from Operations | $2,229,652 | $2,558,584 | $2,936,137 |
Additional Cash Received | |||
Non Operating (Other) Income | $0 | $0 | $0 |
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 | $0 | $0 | $0 |
Subtotal Cash Received | $2,229,652 | $2,558,584 | $2,936,137 |
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $93,757 | $102,000 | $110,500 |
Bill Payments | $1,826,094 | $2,457,050 | $2,556,178 |
Subtotal Spent on Operations | $1,919,851 | $2,559,050 | $2,666,678 |
Additional Cash Spent | |||
Non Operating (Other) Expense | $0 | $0 | $0 |
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 |
Principal Repayment of Current Borrowing | $24,000 | $24,000 | $24,000 |
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 | $1,943,851 | $2,583,050 | $2,690,678 |
Net Cash Flow | $285,801 | ($24,466) | $245,459 |
Cash Balance | $295,601 | $271,134 | $516,594 |
The projected balance sheet is shown in the following table, with monthly projections in the appendix.
Pro Forma Balance Sheet | |||
Year 1 | Year 2 | Year 3 | |
Assets | |||
Current Assets | |||
Cash | $295,601 | $271,134 | $516,594 |
Inventory | $358,198 | $410,929 | $471,438 |
Other Current Assets | $18,750 | $18,750 | $18,750 |
Total Current Assets | $672,549 | $700,813 | $1,006,782 |
Long-term Assets | |||
Long-term Assets | $0 | $0 | $0 |
Accumulated Depreciation | $0 | $0 | $0 |
Total Long-term Assets | $0 | $0 | $0 |
Total Assets | $672,549 | $700,813 | $1,006,782 |
Liabilities and Capital | Year 1 | Year 2 | Year 3 |
Current Liabilities | |||
Accounts Payable | $385,728 | $185,492 | $212,300 |
Current Borrowing | $71,000 | $47,000 | $23,000 |
Other Current Liabilities | $0 | $0 | $0 |
Subtotal Current Liabilities | $456,728 | $232,492 | $235,300 |
Long-term Liabilities | $0 | $0 | $0 |
Total Liabilities | $456,728 | $232,492 | $235,300 |
Paid-in Capital | $25,000 | $25,000 | $25,000 |
Retained Earnings | ($16,450) | $190,821 | $443,321 |
Earnings | $207,271 | $252,500 | $303,160 |
Total Capital | $215,821 | $468,321 | $771,482 |
Total Liabilities and Capital | $672,549 | $700,813 | $1,006,782 |
Net Worth | $215,821 | $468,321 | $771,482 |
The table shows projected business ratios.
Ratio Analysis | ||||
Year 1 | Year 2 | Year 3 | Industry Profile | |
Sales Growth | 0.00% | 14.75% | 14.76% | 0.00% |
Percent of Total Assets | ||||
Inventory | 53.26% | 58.64% | 46.83% | 0.00% |
Other Current Assets | 2.79% | 2.68% | 1.86% | 100.00% |
Total Current Assets | 100.00% | 100.00% | 100.00% | 100.00% |
Long-term Assets | 0.00% | 0.00% | 0.00% | 0.00% |
Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
Current Liabilities | 67.91% | 33.17% | 23.37% | 0.00% |
Long-term Liabilities | 0.00% | 0.00% | 0.00% | 0.00% |
Total Liabilities | 67.91% | 33.17% | 23.37% | 0.00% |
Net Worth | 32.09% | 66.83% | 76.63% | 100.00% |
Percent of Sales | ||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 21.31% | 21.33% | 21.35% | 0.00% |
Selling, General & Administrative Expenses | 8.61% | 8.17% | 7.51% | 0.00% |
Advertising Expenses | 0.00% | 0.00% | 0.00% | 0.00% |
Profit Before Interest and Taxes | 12.70% | 13.34% | 13.94% | 0.00% |
Main Ratios | ||||
Current | 1.47 | 3.01 | 4.28 | 0.00 |
Quick | 0.69 | 1.25 | 2.28 | 0.00 |
Total Debt to Total Assets | 67.91% | 33.17% | 23.37% | 0.00% |
Pre-tax Return on Net Worth | 128.17% | 71.89% | 52.69% | 0.00% |
Pre-tax Return on Assets | 41.13% | 48.04% | 40.37% | 0.00% |
Additional Ratios | Year 1 | Year 2 | Year 3 | |
Net Profit Margin | 9.30% | 9.87% | 10.33% | n.a |
Return on Equity | 96.04% | 53.92% | 39.30% | n.a |
Activity Ratios | ||||
Inventory Turnover | 10.91 | 5.23 | 5.23 | n.a |
Accounts Payable Turnover | 5.73 | 12.17 | 12.17 | n.a |
Payment Days | 27 | 46 | 28 | n.a |
Total Asset Turnover | 3.32 | 3.65 | 2.92 | n.a |
Debt Ratios | ||||
Debt to Net Worth | 2.12 | 0.50 | 0.30 | n.a |
Current Liab. to Liab. | 1.00 | 1.00 | 1.00 | n.a |
Liquidity Ratios | ||||
Net Working Capital | $215,821 | $468,321 | $771,482 | n.a |
Interest Coverage | 43.17 | 72.33 | 146.17 | n.a |
Additional Ratios | ||||
Assets to Sales | 0.30 | 0.27 | 0.34 | n.a |
Current Debt/Total Assets | 68% | 33% | 23% | n.a |
Acid Test | 0.69 | 1.25 | 2.28 | n.a |
Sales/Net Worth | 10.33 | 5.46 | 3.81 | 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 | |||||||||||||
Espresso Syrups | 0% | $14,322 | $16,470 | $18,941 | $21,782 | $25,049 | $28,807 | $33,128 | $38,097 | $43,811 | $50,383 | $57,940 | $66,632 |
Chocolate & Caramel Sauces | 0% | $10,465 | $12,034 | $13,839 | $15,915 | $18,303 | $21,048 | $21,048 | $24,205 | $27,836 | $32,011 | $36,813 | $42,335 |
Specialty Beverage Mixes | 0% | $8,626 | $6,363 | $3,759 | $4,006 | $4,242 | $4,732 | $7,887 | $10,498 | $21,167 | $30,347 | $34,899 | $40,134 |
Energy Drinks | 0% | $1,530 | $1,760 | $2,023 | $2,327 | $2,676 | $3,077 | $3,539 | $4,070 | $4,680 | $5,382 | $6,190 | $7,118 |
Concentrated Milk | 0% | $1,530 | $2,924 | $3,520 | $4,245 | $5,128 | $6,360 | $7,914 | $9,882 | $12,379 | $15,556 | $19,604 | $24,774 |
Paper Supplies | 0% | $51,400 | $47,414 | $43,114 | $45,849 | $51,378 | $58,075 | $68,506 | $85,766 | $123,777 | $177,815 | $202,120 | $230,071 |
Marketing | 0% | $700 | $805 | $910 | $1,015 | $1,155 | $1,295 | $1,470 | $1,680 | $1,890 | $2,170 | $2,450 | $2,765 |
Total Sales | $88,573 | $87,770 | $86,106 | $95,139 | $107,931 | $123,394 | $143,492 | $174,198 | $235,540 | $313,664 | $360,016 | $413,829 | |
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 | |
Espresso Syrups | $11,908 | $13,694 | $15,748 | $18,110 | $20,827 | $23,951 | $27,544 | $31,675 | $36,426 | $41,890 | $48,174 | $55,400 | |
Chocolate & Caramel Sauces | $8,441 | $9,707 | $11,163 | $12,837 | $14,763 | $16,977 | $19,524 | $22,453 | $25,821 | $29,694 | $34,148 | $39,270 | |
Specialty Beverage Mixes | $6,496 | $4,866 | $2,981 | $3,192 | $3,401 | $3,802 | $6,168 | $8,145 | $16,035 | $22,852 | $26,280 | $30,222 | |
Energy Drinks | $1,260 | $1,449 | $1,666 | $1,916 | $2,204 | $2,534 | $2,914 | $3,352 | $3,854 | $4,433 | $5,097 | $5,862 | |
Concentrated Milk | $1,308 | $2,509 | $3,022 | $3,646 | $4,405 | $5,465 | $6,804 | $8,499 | $10,651 | $13,389 | $16,880 | $21,339 | |
Paper Supplies | $38,550 | $35,560 | $32,335 | $34,387 | $38,534 | $43,556 | $51,379 | $64,325 | $92,833 | $133,361 | $151,590 | $172,554 | |
Marketing | $250 | $288 | $325 | $363 | $413 | $463 | $525 | $600 | $675 | $775 | $875 | $988 | |
Subtotal Direct Cost of Sales | $68,213 | $68,073 | $67,240 | $74,451 | $84,546 | $96,749 | $114,858 | $139,049 | $186,297 | $246,395 | $283,045 | $325,635 |
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 | ||
Jennifer Smith | 0% | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 |
Sales/Delivery (Salary) | 0% | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 |
Sales/Delivery (Commission) | 0% | $170 | $192 | $216 | $240 | $268 | $300 | $336 | $379 | $429 | $493 | $565 | $649 |
Delivery/Warehouse Personnel | 0% | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 | $1,700 |
Administration | 0% | $1,560 | $1,560 | $1,560 | $1,560 | $1,560 | $1,560 | $1,560 | $1,560 | $1,560 | $1,560 | $1,560 | $1,560 |
Total People | 4 | 4 | 4 | 4 | 4 | 4 | 4 | 4 | 4 | 4 | 4 | 4 | |
Total Payroll | $7,630 | $7,652 | $7,676 | $7,700 | $7,728 | $7,760 | $7,796 | $7,839 | $7,889 | $7,953 | $8,025 | $8,109 |
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 | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | |
Long-term Interest Rate | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | 8.00% | |
Tax Rate | 30.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | |
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 | $88,573 | $87,770 | $86,106 | $95,139 | $107,931 | $123,394 | $143,492 | $174,198 | $235,540 | $313,664 | $360,016 | $413,829 | |
Direct Cost of Sales | $68,213 | $68,073 | $67,240 | $74,451 | $84,546 | $96,749 | $114,858 | $139,049 | $186,297 | $246,395 | $283,045 | $325,635 | |
Hidden Row | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Cost of Sales | $68,213 | $68,073 | $67,240 | $74,451 | $84,546 | $96,749 | $114,858 | $139,049 | $186,297 | $246,395 | $283,045 | $325,635 | |
Gross Margin | $20,360 | $19,697 | $18,866 | $20,688 | $23,385 | $26,645 | $28,634 | $35,149 | $49,243 | $67,269 | $76,971 | $88,194 | |
Gross Margin % | 22.99% | 22.44% | 21.91% | 21.74% | 21.67% | 21.59% | 19.96% | 20.18% | 20.91% | 21.45% | 21.38% | 21.31% | |
Expenses | |||||||||||||
Payroll | $7,630 | $7,652 | $7,676 | $7,700 | $7,728 | $7,760 | $7,796 | $7,839 | $7,889 | $7,953 | $8,025 | $8,109 | |
Other | $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 | |
Rent | $2,758 | $2,758 | $2,758 | $2,758 | $2,758 | $2,758 | $2,758 | $2,758 | $2,758 | $2,758 | $2,758 | $2,758 | |
Utilities and Phone | $600 | $600 | $600 | $600 | $600 | $600 | $600 | $600 | $600 | $600 | $600 | $600 | |
Insurance | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | |
Payroll Burden | 15% | $1,145 | $1,148 | $1,151 | $1,155 | $1,159 | $1,164 | $1,169 | $1,176 | $1,183 | $1,193 | $1,204 | $1,216 |
Leased Equipment (Delivery Vehicles) | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | |
Leased Equipment (Warehouse) | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $250 | |
Leased Equipment (Other) | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | |
Fuel (delivery) | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | |
Advertising / Promotion | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | |
Professional Services | 15% | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 |
Miscellaneous (office supplies, etc) | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | |
Total Operating Expenses | $15,783 | $15,808 | $15,835 | $15,863 | $15,895 | $15,932 | $15,973 | $16,023 | $16,080 | $16,154 | $16,237 | $16,333 | |
Profit Before Interest and Taxes | $4,578 | $3,889 | $3,030 | $4,825 | $7,490 | $10,713 | $12,661 | $19,126 | $33,163 | $51,116 | $60,735 | $71,861 | |
EBITDA | $4,578 | $3,889 | $3,030 | $4,825 | $7,490 | $10,713 | $12,661 | $19,126 | $33,163 | $51,116 | $60,735 | $71,861 | |
Interest Expense | $620 | $607 | $593 | $580 | $567 | $553 | $540 | $527 | $513 | $500 | $487 | $473 | |
Taxes Incurred | $1,187 | $821 | $609 | $1,061 | $1,731 | $2,540 | $3,030 | $4,650 | $8,162 | $12,654 | $15,062 | $17,847 | |
Other Income | |||||||||||||
Interest Income | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other Income Account Name | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Other Income | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other Expense | |||||||||||||
Account Name | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other Expense Account Name | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Other Expense | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Net Other Income | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Net Profit | $2,770 | $2,462 | $1,828 | $3,184 | $5,192 | $7,620 | $9,090 | $13,950 | $24,487 | $37,962 | $45,186 | $53,541 | |
Net Profit/Sales | 3.13% | 2.80% | 2.12% | 3.35% | 4.81% | 6.18% | 6.34% | 8.01% | 10.40% | 12.10% | 12.55% | 12.94% |
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 | $88,573 | $87,770 | $86,106 | $95,139 | $107,931 | $123,394 | $143,492 | $174,198 | $235,540 | $313,664 | $360,016 | $413,829 | |
Subtotal Cash from Operations | $88,573 | $87,770 | $86,106 | $95,139 | $107,931 | $123,394 | $143,492 | $174,198 | $235,540 | $313,664 | $360,016 | $413,829 | |
Additional Cash Received | |||||||||||||
Non Operating (Other) Income | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
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 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Received | $88,573 | $87,770 | $86,106 | $95,139 | $107,931 | $123,394 | $143,492 | $174,198 | $235,540 | $313,664 | $360,016 | $413,829 | |
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 | $7,630 | $7,652 | $7,676 | $7,700 | $7,728 | $7,760 | $7,796 | $7,839 | $7,889 | $7,953 | $8,025 | $8,109 | |
Bill Payments | $2,607 | $78,184 | $77,442 | $76,236 | $92,651 | $106,626 | $122,274 | $147,608 | $181,556 | $257,760 | $334,299 | $348,850 | |
Subtotal Spent on Operations | $10,237 | $85,836 | $85,118 | $83,936 | $100,379 | $114,386 | $130,070 | $155,447 | $189,445 | $265,713 | $342,324 | $356,959 | |
Additional Cash Spent | |||||||||||||
Non Operating (Other) Expense | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Principal Repayment of Current Borrowing | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | |
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 | $12,237 | $87,836 | $87,118 | $85,936 | $102,379 | $116,386 | $132,070 | $157,447 | $191,445 | $267,713 | $344,324 | $358,959 | |
Net Cash Flow | $76,336 | ($66) | ($1,012) | $9,203 | $5,552 | $7,008 | $11,422 | $16,751 | $44,095 | $45,951 | $15,692 | $54,870 | |
Cash Balance | $86,136 | $86,071 | $85,059 | $94,262 | $99,813 | $106,821 | $118,243 | $134,994 | $179,089 | $225,039 | $240,731 | $295,601 |
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 | $9,800 | $86,136 | $86,071 | $85,059 | $94,262 | $99,813 | $106,821 | $118,243 | $134,994 | $179,089 | $225,039 | $240,731 | $295,601 |
Inventory | $75,000 | $75,034 | $74,880 | $73,964 | $81,896 | $93,001 | $106,424 | $126,344 | $152,954 | $204,926 | $271,034 | $311,349 | $358,198 |
Other Current Assets | $18,750 | $18,750 | $18,750 | $18,750 | $18,750 | $18,750 | $18,750 | $18,750 | $18,750 | $18,750 | $18,750 | $18,750 | $18,750 |
Total Current Assets | $103,550 | $179,920 | $179,701 | $177,773 | $194,908 | $211,564 | $231,995 | $263,337 | $306,698 | $402,765 | $514,823 | $570,830 | $672,549 |
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 | $103,550 | $179,920 | $179,701 | $177,773 | $194,908 | $211,564 | $231,995 | $263,337 | $306,698 | $402,765 | $514,823 | $570,830 | $672,549 |
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 | $75,600 | $74,919 | $73,163 | $89,114 | $102,578 | $117,390 | $141,641 | $173,052 | $246,632 | $322,728 | $335,549 | $385,728 |
Current Borrowing | $95,000 | $93,000 | $91,000 | $89,000 | $87,000 | $85,000 | $83,000 | $81,000 | $79,000 | $77,000 | $75,000 | $73,000 | $71,000 |
Other Current Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Subtotal Current Liabilities | $95,000 | $168,600 | $165,919 | $162,163 | $176,114 | $187,578 | $200,390 | $222,641 | $252,052 | $323,632 | $397,728 | $408,549 | $456,728 |
Long-term Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Liabilities | $95,000 | $168,600 | $165,919 | $162,163 | $176,114 | $187,578 | $200,390 | $222,641 | $252,052 | $323,632 | $397,728 | $408,549 | $456,728 |
Paid-in Capital | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 |
Retained Earnings | ($16,450) | ($16,450) | ($16,450) | ($16,450) | ($16,450) | ($16,450) | ($16,450) | ($16,450) | ($16,450) | ($16,450) | ($16,450) | ($16,450) | ($16,450) |
Earnings | $0 | $2,770 | $5,232 | $7,060 | $10,244 | $15,436 | $23,056 | $32,146 | $46,096 | $70,583 | $108,545 | $153,731 | $207,271 |
Total Capital | $8,550 | $11,320 | $13,782 | $15,610 | $18,794 | $23,986 | $31,606 | $40,696 | $54,646 | $79,133 | $117,095 | $162,281 | $215,821 |
Total Liabilities and Capital | $103,550 | $179,920 | $179,701 | $177,773 | $194,908 | $211,564 | $231,995 | $263,337 | $306,698 | $402,765 | $514,823 | $570,830 | $672,549 |
Net Worth | $8,550 | $11,320 | $13,782 | $15,610 | $18,794 | $23,986 | $31,606 | $40,696 | $54,646 | $79,133 | $117,095 | $162,281 | $215,821 |
Fill-in-the-blanks and automatic financials make it easy.
No thanks, I prefer writing 40-page documents.
Discover the world’s #1 plan building software
If you want to start a distribution business or expand your current distribution business, you need a business plan.
The following Distribution Company business plan template gives you the key elements to include in a winning Distribution business plan.
You can download our Business Plan Template (including a full, customizable financial model) to your computer here.
Below are links to each of the key sections of your Distribution Company business plan: I. Executive Summary II. Company Overview III. Industry Analysis IV. Customer Analysis V. Competitive Analysis VI. Marketing Plan VII. Operations Plan VIII. Management Team IX. Financial Plan
Comments are closed.
Distribution Company Business Plan Home I. Executive Summary II. Company Overview III. Industry Analysis IV. Customer Analysis V. Competitive Analysis VI. Marketing Plan VII. Operations Plan VIII. Management Team IX. Financial Plan
ZenBusinessPlans
Home » Business Model
Do you want to start a distribution business? If YES, here is everything you must know about the distribution Business model plus examples of successful companies. Being in business is tough, hence the need to choose a business model that you can run your business on. The truth is that you can hardly make success out of your business if you don’t build and operate your business on an existing model that suits your business.
A quick tip is to look around you and find out the type of business model the company you are patterning your business after is operating. With that, you would have eliminated the time and resources wasted in trial and error approach. You will just settle down to your business with little or no stress.
But on the average, one of the business models that an investor who is looking towards starting a business in the united states of America should consider adopting is the distribution business model. One good thing about the distribution model is that you don’t necessarily need to manufacture products of your own, you can comfortably engage in the distribution of the products of a company or several companies at the same time.
If you are making plans to start a distribution business or you are already running a distribution business but your need to know more about the business model and some of the leading companies that are already operating this business model, then you will find this article highly useful.
Distribution business model is a business model that facilitates that distribution of goods and services from the producers / manufacturers to the end users / consumers; it is a business model that ensures that products and services reach target customers in the most direct and cost-efficient manner. If it is services, distribution is predominantly concerned with access.
In the actual sense, the distribution model is a concept that is relatively simple and straightforward. In practice, distribution business model may involve a diverse range of activities and disciplines including: detailed logistics, transportation, warehousing, storage, inventory management as well as channel management including selection of channel members and rewarding distributors.
The strategy adopted by a company operating on the distribution business model to a large extent depends on a number of factors such as the type of products to be distributed, especially perishability; the market served; the geographic scope of operations and the organizations’ overall mission and vision. With that, you will be able to pattern your business to suit the distribution business model.
In the case of intensive distribution approach, the marketer relies on chain stores to reach broad markets in a cost – efficient manner. Basically, we have three strategies that operators of distribution model adopt and they are;
Mass distribution which is also known as intensive distribution is a distribution strategy that is used basically for products that are produced or manufactured for a mass market, the marketer will seek out intermediaries that appeal to a broad market base.
It is common to find industrial giants who are into mass production of products adopt this distribution strategy to get their goods or services to every nooks and crannies of their target market location.
For example, it is only but natural for a company like Coca Cola that adopts mass distribution strategy to distribute cum retail their products. Little wonder there is hardly any location in the United States of America or in major cities all across the world that you won’t find Coca Cola products.
Selective distribution strategy is a distribution strategy that enables the manufacturer of a product or services to restrict the number of outlets retailing their products. Despite the fact that there are some drawbacks to this distribution strategy, but you can’t rule out the fact that it has loads of benefits.
Some of the benefits includes the ability to control your distribution chains, train your distributors to be able to better market your products and buy into the organization’s overall business goal or the big picture why the products is on sale. For example, the manufacturers of some luxury cars might restrict the distribution and sale of their products to only selected and accredited distributors who are trained and have been able to prove their worth in the business.
Exclusive distribution strategy is a distribution strategy where the manufacturer of a product or services chooses to deal with one intermediary or one type of intermediary. Just like selective distribution strategy, exclusive distribution strategy has a handful of drawbacks, but it has its own advantages especially if you are into the production of goods that are not meant for the general public.
One major advantage of an exclusive distribution strategy is that the manufacturer retains greater control over the distribution process.
In exclusive distribution strategy, the distributor is expected to work closely with the manufacturer and add value to the product through service level, after sales care or client support services. The most common type of exclusive arrangement is an agreement between a supplier and a retailer granting the retailer exclusive rights within a specific geographic area to carry the supplier’s product.
In practice, distribution of goods and services are carried out via a marketing channel which can be referred to as a distribution channel. A marketing channel is made up of the people, organizations, and activities that are necessary to transfer the ownership of goods from the point of production to the point of consumption or the end user.
It is the process by which products or services get to the end-user, the consumer. This is usually accomplished through merchant retailers or wholesalers or, in the international context, by importers. Please note that in certain specialist markets, agents or brokers may become involved in the marketing channel.
A wholesaler is a merchant intermediary who sells primarily to retailers, other merchants, or industrial, institutional, and commercial users mainly for resale or business use. Wholesalers essentially sell in large quantities and it is rare to find them selling directly to end users or consumers.
An agent is a distinctive intermediary who is authorized to legally act for a principal in order to transact business on their behalf or facilitate exchange of good and services as instructed by the principal. Unlike merchant wholesalers and retailers, agents do not take title to goods, but simply put buyers and sellers together. Agents are typically paid via commissions by the principal. For example, real estate agents are paid a commission of around 5 – 15 percent for accommodation leased, rented out or sold.
A jobber is a unique type of wholesaler who is known to operate on a small scale and sells only to retailers or institutions. Jobber, in merchandising, can be synonymous with “wholesaler” or “distributor” or “broker” or “middleman.” A business which buys goods and bulk products from importers, other wholesalers, or manufacturers, and then sells to retailers, was historically called a jobbing house.
For example, rack jobbers are small independent wholesalers who operate from a truck, supplying convenience stores with snack foods and drinks on a regular basis. If you operate a distribution model, then you should learn how to Manage your distribution channels.
Operating a distribution business model requires that the organization’s marketing department and logistic team to design the most suitable channels for the products and services produced by the organization, then select appropriate channel members or intermediaries. An organization may need to train staff of intermediaries and motivate the intermediary to sell the firm’s products.
The organization is expected to monitor the channel’s performance over time and from time to time improvise on how to continuously improve the channel to boost performance in the market place. This is highly necessary because competition is expected to grow in your line of business. In the bid to continue to improve your performance in the market place, you are expected to continue to motivate players in your distribution channels to deliver.
There are several ways a company that is operating the distribution business model can motivate intermediaries working in their distribution value chain to deliver. You can leverage on making use of positive actions, such as offering higher margins to the intermediary, special deals, premiums and allowances for advertising or display of products, free trainings and competitive credit facility in terms of releasing goods and getting back your money later.
On the other hand, negative actions may be necessary, such as threatening to cut back on margin, or hold back delivery of products or services. Please note that caution must be applied when considering negative actions because these may fall foul of regulations and can contribute to a public backlash and a public relations disaster.
It is expected that conflict of interest may arise amongst players in your distribution channels hence you need to know how to handle it; The truth is that conflict of interest may likely arise amongst your distribution channel and this can happen when one intermediary’s actions prevent another intermediary from achieving their objectives.
Vertical channel conflict occurs between the levels within a channel, and horizontal channel conflict occurs between intermediaries at the same level within a channel. Channel conflict is a perennial problem. There is a possibility that an influential channel member may monopolize and coordinate the interests of the channel for personal gain.
Lastly, in order to continue to push your products to end users and consumers, you must place premiums on your customer – customer value;
If you are in business, aside from the quality of your products and services, the value you place on your customer is one major factor that will help you to continue to sell your product or services to them. The truth is that if you have a good product and bad customer services; not placing value on your customer, it won’t be too long before you to lose your customer and experience depletion in your income.
This is one of the chief reasons why most organizations spend more to establish customer service; a medium through which they can receive complaints and feedback from their clients. The essence of distributing a product is for it to get to end users and consumers and if they feel that they are not treated well; they are likely going to look for alternative product or service providers.
A distribution plan outlines the processes and resources necessary to move a product from its point of origin to its consumers. This plan typically includes a detailed overview of the different channels and locations where a product will be stored, manufactured, and shipped. It also outlines the key performance indicators (KPIs) that will be used to measure the effectiveness of the plan. By creating a comprehensive distribution plan, businesses can optimize their supply chain operations and improve customer satisfaction.
Each focus area has its own objectives, projects, and KPIs to ensure that the strategy is comprehensive and effective.
This Distribution Plan template is designed to help supply chain and logistics teams plan and optimize the distribution of products or materials. It can be used by anyone responsible for designing and executing a distribution plan, including supply chain managers, logistics specialists, and warehouse personnel.
A Focus Area is a broad area of the supply chain process that the team wants to improve. Examples of Focus Areas could include ‘Optimizing Distribution Network’, ‘Optimizing Inventory Management’, and ‘Enhancing Customer Satisfaction’. For each Focus Area, the team should identify and outline specific objectives, measurable targets, and related projects that need to be completed.
An Objective is a goal that the team wants to accomplish for each Focus Area. Objectives should be specific and measurable, and should be achievable within a given time frame. Examples of some objectives for the focus area of Optimize Distribution Network could be: Reduce Operational Inefficiency , and Increase Delivery Reach .
A Key Performance Indicator (KPI) is a metric that is used to measure the success of a project. KPIs should be quantifiable and measurable, and should be set with an initial value and a target value. For example, for the objective to ‘Reduce Operational Inefficiency’, a KPI could be to ‘Decrease order processing time from 16 minutes to 5 minutes’.
A Project (or Action) is the specific initiative that needs to be taken in order to achieve a KPI. Projects are the steps that need to be completed in order to achieve the desired KPI. For example, for the KPI to ‘Decrease order processing time from 16 minutes to 5 minutes’, a related project could be to ‘Automate manual processes’.
Cascade’s Strategy Execution Platform is the perfect tool to help teams efficiently plan, track, and measure the success of their distribution plan. With Cascade, teams can easily monitor KPIs, track progress on projects, and quickly identify any areas that need improvement. By utilizing Cascade’s platform, teams can ensure that their strategies are implemented in a timely and efficient manner.
When it comes to starting a business as a wholesale distributor, or scaling a business to include it, it’s essential that things be ready to start running as soon as operations begin, which is where a wholesale business plan comes into play. Wholesale plays an important role in the supply chain of a retail business. Starting operations without the right preparation can cause major problems to pop up almost immediately.
Most prospective business owners usually understand that a business plan is essential for starting a business. However, it’s often treated as a tool for acquiring funding for the business. The US Bureau of Labor Statistics indicates that 1 in 5 businesses doesn’t make it past the first year of operations. Another 10% fail after the second year. Some of the commonly cited reasons include a failure to properly assess the market, not enough financing, and even business plan problems. Here, we’re going to help you gain every chance of success with a comprehensive guide to your wholesale business plan.
Business plans are commonly used for acquiring funding when starting a business. Although there are alternative options, such as micro-lenders and peer-to-peer lending platforms, most wholesale business owners are going to look to banks for their initial loans. They are a little less flexible than alternative lenders, but they are often able to lend more than you might find elsewhere. Having a proper business plan , stating the goals, mission, and functional operation of the business is essential. But what else does a bank look for when giving a loan?
Banks aim to lend to business owners who have sensible and realistic goals for the funds they plan to borrow. As such, stating how much you want to borrow and how you intend to spend your finances is key. This makes it easier for the bank to assess the chances of seeing their funding repaid.
That isn’t the only factor that banks are going to take a close look at, however. Business owners should also take a look at their credit report and score , to ensure there are no false reports negatively affecting their chances of borrowing. Furthermore, if the business is already in operation, the bank is going to want a close look at any existing financial records. They will always look to check your cash flow statements, balance sheet, and income statements to see the existing financial stability of the business.
SCHEDULE MY EXPERT
Like any plan, the business plan should set the road ahead for your business, highlighting the goals and objectives that can ensure you’re always on the right track for growth. It’s much easier to successfully build something when you know what it is that you’re trying to build. Your objectives and goals should be based on the vision you have of where you want your business to be, laying out specific steps to help you get to that point. Goals are the long-term indicators of your success, while objectives are the detailed steps in place to help you reach those goals.
Effectively, your goals tell you where you want to go, and your objectives will teach you how to get there. Both should be SMART (specific, measurable, attainable, realistic, and time-bound) to ensure that you can realistically reach them and to clearly define when they have been met. Goals and objectives can be set in all realms of business, including revenue, profitability, customer service, customer retention, and more.
Examples of some objectives and goals you might set for a wholesale business might include:
Your business plans are going to demand a much closer look at your market, what is financially necessary for the success of your wholesale business, and a mission statement that aligns with the type of business you intend to run. You want to create a road map for the company’s future that can ensure you’re making the right decisions and using your energy and funding in the most strategically viable way possible, so sitting down and seriously considering your objectives and goals is essential.
For an initial business plan, it’s easy to keep the scope of your objectives and goals relatively modest. Many will focus on what comes in the next year or two years after starting a business with the intention of giving themselves the healthiest beginning possible. However, your short-term goals and objectives should be supported by and consistent with a long-term strategy based on the kind of business that you want to run five, six, or seven years down the line.
To that end, you should make sure that you have a strong mission statement before you start laying out your goals and objectives. Your mission statement should answer the questions of what your company does, how it does it, and why it does it. From that statement, you can derive your long-term goals, as well as the objectives that help you meet them. If you can’t find long-term goals that fit your mission statement, then it’s time to rethink what your business is about and rewrite it accordingly.
While short-term goals and objectives tend to look more at the individual indicators of growth and success, the long-term plan should look at what you want the business to look like in five or more years. Think about what business model you want to be running, how much revenue you will have, what your supplier relationships will look like, what market you want to be established in, and more. Cover every area of the business that you have a specific vision for, then start laying out the SMART objectives that can help you reach that in the long-term.
A business plan does a lot more than dictate where you want to go, it also lays out the business structures and processes that will help you get there. The organizational structure section of the plan is going to look at the organization and management of the business, members of that structure and their duties, and where they belong within certain teams and chains of command. It’s effectively a summary of how a business is run, who does what, and who they answer to. The structure itself is going to focus on the hierarchy within the team, but you should also open with a description of who is in the management team and what their qualifications are, especially if you want to use your business plan to source funding.
Main divisions of wholesale businesses may include the following organizational departments:
Needless to say, the organizational structure of a wholesale business can change drastically from business to business.
As mentioned, when it comes to seeking funding, your bank (or lender of any kind) is going to want to know how you plan on using their funding. It is often a key question in determining whether a bank will lend to you or not. As such, you should have a clear idea of how much money you need to borrow and where it’s going to be spent before you make the application.
As you write your business plan, you should be developing a key idea of where you plan to invest. Try to simplify the priorities of the funding. Rather than detailing a laundry list of what you want the funding for, try to allocate percentages of funding levels for different aspects of the business (inventory funding, hiring, and fleet purchasing/leasing) for instance. Have reference materials breaking down the costs incorporated in each that the bank or investors can take a closer look at, too.
As well as writing why you need the funding that you’re applying for when starting a business, you should also consider putting down plans for how you’re going to repay the lender you’re applying to. Including a strong repayment plan in your business plan gives them peace of mind that fulfilling your financial obligations to them is a serious consideration for you, which can increase your chances of funding success.
A part of a larger supply chain, wholesale distributors rely on a healthy ecosystem of partners to drive their own success. This can include the potential buyers they end up forming a relationship with but should also include their own suppliers and manufacturers providing them the goods that they sell. If you’re serious about starting a business in wholesale, you’re going to need to find these partners early. If you’re planning on applying for funding from your bank or investors, you’re going to want to find some before you’ve finished writing your business plan.
You don’t need to have formally made any agreements before your application and, indeed, you will have a tough time doing so before you’ve had the opportunity to establish your operations. However, showing that you’ve had meaningful conversations with some of your potential partners is a good indicator to lenders that you have an idea of how you’re going to find both suppliers and buyers when things are up and running.
Research will play a key role in finding retail clients and partners . Making a note of the potential partners in your market who aren’t yet served by someone providing what you do (which is easily done by looking at their inventory) is a start. Reaching out with pre-emptive questions about their potential interest in the products you plan on selling could help open an early line of communication. Building relationships and correspondence through networking and past industry experience can also help establish the potential partnerships that most lenders are going to keep an eye out for, as well.
Your financial data is important for more than showing potential lenders how you plan to use your funding and to repay any loans. It plays a key role in determining the financial viability of the business as a whole. It can help you determine where you need investment, identify key costs of running a business (which could be reduced in future), and gain a better understanding of your cash flow and aspects that could affect it, such as whether your business will have seasonal cycles. Simply put, a business plan without a financial plan isn’t very useful.
There are four key steps to preparing your financial data, as well as statements you should have to summarize them. They are as follows:
Naturally, the financial data for an already established business is going to be much more detailed than for one that is just starting up. However, regardless of what point your business is at, currently, this is an essential step for making applications with funding institutions as well as helping you understand the financial needs and liabilities of your business.
The more proven your business idea, the better it is for you. Not only do potential lenders look for an established idea that they can reasonably expect to pay off in time, but it’s much more effective to have a solid idea of your own business’s viability before you start investing too much time and effort in it. This is exactly what market research is all about: finding the evidence to support your business’s existence and purpose.
There are multiple steps to take when conducting market research for your business. The first is in customer profiling, thinking about who your customer base is, what demographics they fall under, and where you’re likely to reach them. The next is to carry out competitor analysis . Who else in the market offers what you do right now? What signs of growth and success they show and what differentiates your business from theirs enough to offer you a space in the market? With that information in mind, next, you should carry out customer surveys, asking them about what they’re looking for in the market, whether current providers offer what they’re seeking, and what they feel like is currently lacking amongst their choices. Business advisors, trade bodies, and other industry researchers should be able to provide more details on market size, industry benchmarking reports (to compare with your own plans and objectives), and location demographic details. All of this data should be included in your plan specifically to show evidence that there is room for your business in the market.
At R+L Global Logistics, we have the experience of serving global supply chains in all kinds of specialized and general wholesale distribution fields, so we’re in a prime position to offer consulting to business owners getting into the market. We can provide the experience, insight, and data that can help support and transform your plans to offer you the best chance of success you could hope for. From determining your potential customers to helping you understand the best way to sell products within your market, we can lend the proven expertise to match your vision and efforts.
In addition to providing you with knowledge expertise in business development, we can fully manage your supply chain. Getting your products to and from where they need to go, can be one of the most costly and time-consuming aspects of running a wholesale business. Having reliable partners to manage this process can save time and money and improve business efficiency.
No matter what stage of life your business is at, we’re here to help you with your order management and everything in between. Contact us today and we’ll get you to your next steps.
Your email address will not be published. Required fields are marked *
Save my name, email, and website in this browser for the next time I comment.
Published: July 01, 2024
I believe that reading sample business plans is essential when writing your own.
As you explore business plan examples from real companies and brands, it’s easier for you to learn how to write a good one.
So what does a good business plan look like? And how do you write one that’s both viable and convincing? I’ll walk you through the ideal business plan format along with some examples to help you get started.
Table of Contents
Business plan format, sample business plan: section by section, sample business plan templates, top business plan examples.
Ultimately, the format of your business plan will vary based on your goals for that plan. I’ve added this quick review of different business plan types that achieve differing goals.
For a more detailed exploration of business plan types, you can check out this post .
The essential document for starting a business -- custom built for your needs.
All fields are required.
Click this link to access this resource at any time.
Startup business plans are for proposing new business ideas. If you’re planning to start a small business, preparing a business plan is crucial. The plan should include all the major factors of your business.
You can check out this guide for more detailed business plan inspiration .
Feasibility business plans focus on that business's product or service. Feasibility plans are sometimes added to startup business plans. They can also be a new business plan for an already thriving organization.
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.
A strategic business plan is another business plan that's often shared internally. This plan covers long-term business objectives that might not have been included in the startup business plan.
When a business is moving forward with an acquisition or repositioning, it may need extra structure and support. These types of business plans expand on a company's acquisition or repositioning strategy.
Growth sometimes just happens as a business continues operations. But more often, a business needs to create a structure with specific targets to meet set goals for expansion. This business plan type can help a business focus on short-term growth goals and align resources with those goals.
I’m going to focus on a startup business plan that needs to be detailed and research-backed as well as compelling enough to convince investors to offer funding. In my experience, the most comprehensive and convincing business plans contain the following sections.
This all-important introduction to your business plan sets the tone and includes the company description as well as what you will be exchanging for money — whether that’s product lines, services, or product-service hybrids.
Information about gaps in your industry’s market and how you plan to fill them, focused on demand and potential for growth.
An overview of your competitors that includes consideration of their strengths and how you’ll manage them, their weaknesses and how you’ll capitalize on them, and how you can differentiate your offerings in the industry.
Descriptions of your ideal customers, their various problems that you can solve, and your customer acquisition strategy.
This section details how you will market your brand to achieve specific goals, the channels and tactics you’ll utilize to reach those goals, and the metrics you’ll be using to measure your progress.
This is where you’ll use plain language to emphasize the value of your product/service, how it solves the problems of your target audiences, and how you’ll scale up over time.
This section describes your pricing strategy and plans for building revenue streams that fit your audiences while achieving your business goals.
This is the final section, communicating with investors that your business idea is worth investing in via profit/loss statements, cash flow statements, and balance sheets to prove viability.
Okay, so now that we have a format established, I’ll give you more specific details about each section along with examples. Truthfully, I wish I’d had this resource to help me flesh out those first business plans long ago.
I’d say the executive summary is the most important section of the entire business plan. It is essentially an overview of and introduction to your entire project.
Write this in such a way that it grabs your readers' attention and guides them through the rest of the business plan. This is important because a business plan can be dozens or hundreds of pages long.
There are two main elements I’d recommend including in your executive summary: your company description and your products and services.
This is the perfect space to highlight your company’s mission statement and goals, a brief overview of your history and leadership, and your top accomplishments as a business.
Tell potential investors who you are and why what you do matters. Naturally, they’re going to want to know who they’re getting into business with up front. This is a great opportunity to showcase your impact.
Need some extra help firming up your business goals? I’d recommend HubSpot Academy’s free course to help you set meaningful goals that matter most for your business.
Products and Services
Here, you will incorporate an overview of your offerings. This doesn’t have to be extensive, as it is just a chance to introduce your industry and overall purpose as a business. I recommend including snippets of information about your financial projections and competitive advantage here as well.
Keep in mind that you'll cover many of these topics in more detail later on in the business plan. The executive summary should be clear and brief, only including the most important takeaways.
This example was created with HubSpot’s business plan template . What makes this executive summary good is that it tells potential investors a short story while still covering all of the most important details.
Our Mission
Maria’s Gluten Free Bagels offers gluten-free bagels, along with various toppings, other gluten-free breakfast sandwich items, and coffee. The facility is entirely gluten free. Our team expects to catch the interest of gluten-free, celiac, or health-conscious community members who are seeking an enjoyable cafe to socialize. Due to a lack of gluten-free bagel products in the food industry currently, we expect mild competition and are confident we will be able to build a strong market position.
The Company and Management
Maria’s Gluten Free Bagels was founded in 2010 by Maria Jones, who first began selling her gluten-free bagels online from her home, using social media to spread the word. In 2012 she bought a retail location in Hamilton, MA, which now employs four full-time employees and six part-time employees. Prior to her bagel shop, Maria was a chef in New York and has extensive experience in the food industry.
Along with Maria Jones, Gluten Free Bagel Shop has a board of advisors. The advisors are:
Our Product
We offer gluten-free products ranging from bagels and cream cheese to blueberry muffins, coffee, and pastries. Our customers are health-conscious, community-oriented people who enjoy gluten-free products. We will create a welcoming, warm environment with opportunities for open mic nights, poetry readings, and other community functions. We will focus on creating an environment in which someone feels comfortable meeting a friend for lunch, or working remotely.
Our Competitive Advantages
While there are other coffee shops and cafes in the North Shore region, there are none that offer purely gluten-free options. This restricts those suffering from gluten-free illnesses or simply those with a gluten-free preference. This will be our primary selling point. Additionally, our market research [see Section 3] has shown a demand for a community-oriented coffee and bagel shop in the town of Hamilton, MA.
Financial Considerations
Our sales projections for the first year are $400,000. We project a 15% growth rate over the next two years. By year three, we project 61% gross margins.
We will have four full-time employees. The salary for each employee will be $50,000.
Start-up Financing Requirements
We are seeking to raise $125,000 in startup to finance year one. The owner has invested $50,000 to meet working capital requirements, and will use a loan of $100,000 to supplement the rest.
Example 2 :
Marianne and Keith Bean have been involved with the food industry for several years. They opened their first restaurant in Antlers, Oklahoma in 1981, and their second in Hugo in 1988. Although praised for the quality of many of the items on their menu, they have attained a special notoriety for their desserts. After years of requests for their flavored whipped cream toppings, they have decided to pursue marketing these products separately from the restaurants.
Marianne and Keith Bean have developed several recipes for flavored whipped cream topping. They include chocolate, raspberry, cinnamon almond, and strawberry. These flavored dessert toppings have been used in the setting of their two restaurants over the past 18 years, and have been produced in large quantities. The estimated shelf life of the product is 21 days at refrigeration temperatures and up to six months when frozen. The Beans intend to market this product in its frozen state in 8 and 12-ounce plastic tubs. They also intend to have the products available in six ounce pressurized cans. Special attention has been given to developing an attractive label that will stress the gourmet/specialty nature of the products.
Distribution of Fancy's Foods Whipped Dream product will begin in the local southeastern Oklahoma area. The Beans have an established name and reputation in this area, and product introduction should encounter little resistance.
Financial analyses show that the company will have both a positive cash flow and profit in the first year. The expected return on equity in the first year is 10.88%
For more guidance, check out our tips for writing an effective executive summary .
2. Market Opportunity
This is where you'll detail the opportunity in the market. Ask and answer: Where is the gap in the current industry, and how will my product fill that gap?
To get a thorough understanding of the market opportunity, you'll want to conduct a TAM, SAM, SOM analysis , a SWOT analysis , and perform market research on your industry to get some insights for this section. More specifically, here’s what I’d include.
I like this example because it uses critical data to underline the size of the potential market and what part of that market this service hopes to capture.
Example: The market for Doggie Pause is all of the dog owners in the metropolitan area and surrounding areas of the city. We believe that this is going to be 2/3 of the population, and we have a goal of gaining a 50% market share. We have a target of a 20% yearly profit increase as the business continues.
Since we’re already speaking of market share, you‘ll also need to create a section that shares details on who the top competitors are. After all, your customers likely have more than one brand to choose from, and you’ll want to understand exactly why they might choose one over another.
My favorite part of performing a competitive analysis is that it can help you uncover the following:
I like how the competitive landscape section of this business plan shows a clear outline of who the top competitors are. It also highlights specific industry knowledge and the importance of location. This demonstrates useful experience in the industry, helping to build trust in your ability to execute your business plan.
Competitive Environment
Currently, there are four primary competitors in the Greater Omaha Area: Pinot’s Palette Lakeside (franchise partner), Village Canvas and Cabernet, The Corky Canvas, and Twisted Vine Collective. The first three competitors are in Omaha and the fourth is located in Papillion.
Despite the competition, all locations have both public and private events. Each location has a few sold-out painting events each month. The Omaha locations are in new, popular retail locations, while the existing Papillion location is in a downtown business district.
There is an opportunity to take advantage of the environment and open a studio in a well-traveled or growing area. Pinot’s Palette La Vista will differentiate itself from its competitors by offering a premium experience in a high-growth, influential location.
Use this section to describe who your customer segments are in detail. What is the demographic and psychographic information of your audience? I’d recommend building a buyer persona to get in the mindset of your ideal customers and be clear about why you're targeting them. Here are some questions I’d ask myself:
I like the example below because it uses in-depth research to draw conclusions about audience priorities. It also analyzes how to create the right content for this audience.
The Audience
Recognize that audiences are often already aware of important issues. Outreach materials should:
Message Content
Here, you‘ll discuss how you’ll acquire new customers with your marketing strategy. I think it’s helpful to have a marketing plan built out in advance to make this part of your business plan easier. I’d suggest including these details:
This business plan example includes the marketing strategy for the town of Gawler. In my opinion, it works because it offers a comprehensive picture of how they plan to use digital marketing to promote the community.
You’ll also learn the financial benefits investors can reap from putting money into your venture rather than trying to sell them on how great your product or service is.
This business plan guide focuses less on the individual parts of a business plan, and more on the overarching goal of writing one. For that reason, it’s one of my favorites to supplement any template you choose to use. Harvard Business Review’s guide is instrumental for both new and seasoned business owners.
2 Essential Templates For Starting Your Business
Marketing software that helps you drive revenue, save time and resources, and measure and optimize your investments — all on one easy-to-use platform
Distribution business plan, 3+ sample distribution business plan, what is a distribution business plan, 4 types of distribution strategies, how to make an effective distribution business plan, how significant is the role of distribution to a business, how different is a wholesaler from a distributor, how different is a wholesaler from a retailer.
1. executive summary, 2. products and services, 3. market analysis, 4. market strategy, 5. financial plan, share this post on your network, you may also like these articles, 20+ sample technical specification in pdf.
Different industries and organizations develop and plan projects, products, and systems beneficial to the organization, including the consumers and audiences that purchase them for personal or business use. Many…
Incidents should not be a common occurrence in the workplace, but despite all the efforts within a company, they can still happen. The best possible way to address these…
Introduction.
Understanding distribution plans and how to develop them is paramount to the success of any business.
A distribution plan is a strategy that determines how, when and where a company product will be sold to their customers. This plan indicates who, what, where and how products are purchased and delivered. It encompasses product promotion, pricing strategies, delivery methods, stock control and even customer service.
Planning and designing a successful distribution plan can be key to the profitable growth of a business. For example, if a retail company identifies a niche market they can use this knowledge to tailor their product offering and delivery methods.
Designing an effective product distribution strategy requires research, analysis, and an understanding of the various steps and resources needed to implement it. In order to create a comprehensive distribution plan, businesses need to assess the assets required to successfully execute. To get started, a business needs data that includes information about its product or service and an understanding of the customer demographics and demand. Finally, the business needs to identify the best distribution channels, taking into account factors such as cost, ease of use, and potential for growth.
When creating your distribution plan, the first step is to assemble relevant data and insights about your product type. This should include information such as customer preferences, the competition’s network and channel strategies, current trends in the industry, and customer feedback. Gathering this data will enable you to determine the best strategies for marketing and distribution.
The next step is to research customer demographics. Understanding your customers is critical for any successful product launch, so ask yourself questions such as who is likely to be interested in the product and why. Knowing customer information such as age, gender, location, preferences, purchasing power, and interests can help you develop a more targeted distribution plan. Additionally, analyzing customer demand is important because levels of demand can determine which distribution channels are best for the product.
Once you have a better understanding of customer demographics and demand, you can begin identifying the most suitable distribution channels for your product. Consider criteria such as cost, ease of access, time to market, scalability, and customer convenience. Additionally, it is important to research the various distribution centers in order to understand their capabilities and identify any obstacles or limitations. Once you have completed this research and identified the best potential channels, you can begin developing a plan that works for your business.
Creating a logistical plan for your business’s distribution needs begins with an analysis of what your target market's needs are, and how these needs can be met in the most cost-effective and efficient manner. All of this takes place within the framework of any associated legal restrictions, so the planning and implementation process of your distribution should cover the following points:
Depending on where your business operates, there may be local, state, and federal laws that govern your business operations. Additionally, factors such as taxes, permits, currency regulations and tariff regulations must be taken into account. Having a legal advisor during the in-depth planning process of your distribution plan is essential for ensuring that you are complying with all applicable laws and regulations.
Once the legal framework around your business has been established, your next step is to select the appropriate supplier for the type of product(s) you are selling. Researching multiple options and engaging in a competitive bidding process can help you get the best quality product at the lowest price. Additionally, consider whether outsourcing your production requirements is a viable option. If that’s the case, researching outsource providers and cost analysis should be part of this process. Finally, your routes selection should take into consideration the most efficient ways of transporting goods from purchase origin to delivery destination.
Timely delivery of goods is essential to any business, especially those offering minimum lead times for customers. It is important to consider delay possibilities resulting from bad weather, missed delivery targets, labor strikes, and other liabilities. Additionally, having backup plans for emergency scenarios helps minimize any potential disruptions in the supply chain. Make sure to consider all of the steps in the distribution process and plan accordingly with contingencies in place for any eventuality.
Once the distribution plan and the logistical layout has been properly established, the underlying technology and tools must be implemented. Data-driven tools, AI-based applications, and predictive analytics all help with optimizing the supply chain operations, helping to improve the efficiency of the distribution process.
A distribution plan is a vital operation for any business. It not only decides what customer your business will be targeting but also establishes the price and discounts that your business offers. A comprehensive and well-devised distribution plan is essential to increase the reach of your business and generate sales.
The first step in devising a distribution plan for your business is to decide whether you want to sell your product directly to consumers or through distributors. If you choose to use distributors, you can expand your customer network and give yourself more flexibility to create numerous pricing models and discounts. Additionally, you can benefit from the existing customer networks that distributors already have.
Once you have decided whether to implement a direct-to-consumer or distributor model, you need to decide on pricing and discounts for each channel. This will enable you to maximize profits while also gaining customer loyalty. You must also decide whether or not you offer the same discounts to each channel or tailor the discounts to different types of customers. Furthermore, it is essential to keep track of pricing in different channels and stay competitive in the market.
Finding the right channel for your business is critically important. Research different channels available to identify which one suits your target market and budget. You should also consider factors such as the return policy of the channel, their shipping services, the speed of delivery, the needed technology and the customer service offered. Once you have done the research, you can narrow down the available channels to pick the one that best meets your goals.
To conclude, designing a distribution plan for your business requires research and understanding of the customer networks. Deciding between a direct-to-consumer or distributor model, establishing pricing and discounts, and researching and selecting suitable channels for your business are all important aspects of devising a successful distribution plan.
When creating a distribution plan for your business, the focus should be on constructing a plan that will ensure the successful growth of your business while also ensuring the smooth functioning of all the associated activities. Having a detailed plan that takes into consideration all aspects of your distribution strategy will be crucial in the long run, providing you with clear guidance and expectations to foster growth and enable effective planning.
In order to ensure the success of the distribution plan, it is essential to assign roles and responsibilities that clearly defines each team’s roles within the plan. This will assist in understanding who is responsible for which tasks, allowing for clear communication and smoother execution of the plan. It is important to set clear expectations for each team member’s roles and the goals that need to be achieved by each team within the plan.
Establishing clear timelines and performance metrics will be critical in setting expectations for both teams and individual workers. This will help ensure that milestones for the plan are met on time, with benchmarks used to measure progress and assess how expectations are being met. Doing this will help keep the plan on track, helping to stay ahead of any potential delays and having a reliable plan to return to if needed.
As the business grows, it is likely that the plan will need to be adjusted to reflect recent changes or take into consideration new objectives that have been set. Preparing for how to manage adjustments and changes in the plan will be needed to ensure the plan remains up-to-date. Anticipating how changes may occur and defining a process for making these alterations to the plan will help ensure that the strategy stays relevant and that any issues are efficiently dealt with.
Once the distribution plan is in place, it is important to track its performance on an ongoing basis. On-going monitoring of the plan provides important insights on how effectively it is meeting desired goals. Depending on the scale of the business, this may be tracked by an external firm or kept intenally by a designated team.
Tracking performance of each stage in the distribution chain helps you identify inefficiencies and identify where investments are needed for improvement. It also helps you understand how different strategies and tactics are working in reality, so that you can make adjustments accordingly. Aspects to monitor include delivery time, order accuracy, inventory issues, returns and customer satisfaction.
To ensure that your distribution plan is working well, it is important to assess whether the desired goals and objectives you had initially planned for have been met. This helps measure success and gives you a better understanding of how to adjust the plan, if required.
On the basis of the results from your assessments, it is important to refine the plan and make changes to ensure the continued success of your business. This could involve upgrading existing technologies, adding new partners in the chain or changing tactics to better optimize the plan. It is crucial to remain agile and adaptable for a successful and sustainable distribution strategy, as the market environment is ever changing.
Creating a successful distribution plan for your business is essential for its ongoing growth and profitability. A well-designed plan will ensure your product or service reaches consumer markets effectively, cutting costs and increasing customer satisfaction. By investing in your distribution plan, you can bring a competitive edge to your business and remain successful in the long run.
To keep your distribution plan effective, it is important to review it regularly. This will help you evaluate how well the current plan is performing against your goals and identify areas for improvement. By identifying and optimizing any existing gaps in the system, you can take advantage of new opportunities, use insights to boost your competitive advantage, and make changes to keep up with shifting market demands.
Finally, it is important to partner with reliable, reputable distributors and suppliers to ensure the smooth flow of goods throughout the supply chain. Establishing strong relationships with these partners will help you to further optimize your distribution plan, ensuring that your product or service is reaching the highest potential in delivery and customer satisfaction.
Fundrising Ready
MAC & PC Compatible
Immediate Download
Your email address will not be published. Required fields are marked *
Please note, comments must be approved before they are published
Book categories, collections.
Data driven marketing for dummies.
Business planning is all about developing strategies for whatever your business may face. This will include distribution, pricing and promotion strategies that, if you’re prepared, can help you pull ahead of the competition.
You’ll need to assess your company’s distribution capabilities. Include the results of your assessment in the company description portion of your business plan. In your marketing plan — and briefly in the marketing strategy section of your business plan — describe how distribution supports your marketing goals and objectives.
One of the decisions most crucial to business success involves pricing your products. You need to arrive at prices that cover all costs and deliver a reasonable profit margin, while also hitting the sweet spot of what customers are willing to pay for the value they believe they receive from the purchase.
To get your pricing right, you need to match your prices to the image of your business and the nature of your clientele (you can’t charge premium prices if you’ve established your business as a middle-of-the-road option), while also covering your production and operational costs and delivering the profits necessary for your business survival.
After spending time developing your pricing approach, design your pricing strategy that you’ll summarize in the marketing strategy section of your business plan.
The description of your promotion strategy tells how you’ll communicate your marketing message to prospective customers.
In your marketing plan, provide a complete outline of your promotion strategy, including a detailed description of your target customer, your market area, your marketing message, the creative approach you’ll use to convey your message and advance your brand image, the media channels you’ll employ to reach prospective customers, and the budget you’ve allocated to get the job done.
In the marketing section of your business plan, summarize your promotion strategy, taking care to describe how it supports the product, pricing, and distribution strategies your business will follow over the business plan period.
When appropriate, include samples of marketing materials (letterhead, business cards, website screens, brochures, and so on) in the appendix of your business plan. Samples aren’t necessary, but if you have professionally produced materials that contribute to a good, strong image of your company, their inclusion in your plan will contribute to the favorable impression that readers take away from your business plan.
This article can be found in the category:.
In 2017, after a day of bad critics, Pepsi removed its marketing campaign . In the ad campaign, popular model Kendall Jenner joined the rally and handed a police officer a bottled soda, attempting to cool down the tension between the protesters and the police. Despite the good intention of Pepsi , which is to send a message of peace, unity, and understanding, people didn’t take it lightly. According to them, the company underplayed the essence of the protest, which is racism and police violence. As a business owner, you should plan the advertisement, among other parts of the product distribution appropriately and strategically, to ensure that your effort, time, money, and other resources don’t go to waste.
What is a distribution plan, what are the different distribution channels that you can use, 1. mass distribution, 2. selective distribution, 3. exclusive distribution, 12+ distribution plan samples in pdf | doc, 1. distribution plan sample, 2. distribution plan template, 3. distribution plan in doc, 4. distribution plan example, 5. sample distribution plan template, 6. basic distribution plan sample, 7. managed distribution plan sample, 8. distribution plan form sample, 9. formal distribution plan template, 10. simple distribution plan example, 11. distribution plan procedure sample, 12. general distribution plan template, 13. distribution plan in doc, how to create a distribution plan, 1. understand your target market, 2. list down the potential market intermediaries, 3. know more about your potential delegates, 4. choose the right distribution channel.
Also known as a marketing plan, a distribution plan is a component of strategic planning of a business that consists of the details of how the producers or service providers deliver the goods and services to its customers. This plan may involve market delegates, such as distributors, agents, retailers, and wholesalers.
Depending on the nature of your business and its affecting factors, you can use any of the following distribution channels.
This type of distribution consists of various market intermediaries since it intends to distribute the products to everyone. If your company sells products such as fast-moving consumer goods (FMCG), most likely, this is the best distribution channel that you can use for your business plan.
Unlike mass distribution, selective distribution involves only a few market intermediaries. For example, you are producing a type of coffee beans, which can be quite expensive compared to other variations. You can select specific distributors such as coffee shops for your product distribution instead. Another example is selling a content product that has a more specified target market. You will want to use content marketing to distribute your product.
The last but not the least distribution channel that you can use is exclusive distribution. In this distribution, you may involve a single intermediary to distribute your products. For example, you closed a partnership agreement with a coffee shop that has multiple branches across the country. In the deal, it says that the coffee shop should include only the products that you produce on the coffee menu .
For you to know more about the distribution plan, we included the following templates and examples, which you can download in PDF an MS Word format.
Size: 886.1 KB
Size: 865.4 KB
Size: 507.8 KB
Size: 692.0 KB
Size: 308.6 KB
Size: 22.2 KB
Size: 549.0 KB
Size: 133.7 KB
Size: 44.7 KB
Size: 105.9 KB
Size: 118.2 KB
Size: 5.7 KB
Creating a distribution plan for your new products can be a messy job. That is why we included the following steps, which you can use as a reference in creating a distribution plan along with your marketing strategy smoothly.
Before anything else, you should do some research to know your market. Most companies start the process by conducting market research . This type of study will allow you to understand the preferences of your customers in terms of distributors, customer service, etc.
After the target market analysis , the next thing that you should do is to identify the potential intermediaries that can help you deliver your products to the consumers. Intermediaries may include retailers, wholesalers, and agents. Keep it in mind that there are two types of intermediaries that you can include in your list, which are the direct and indirect sellers. If the market analysis that you conducted indicates that the best way to deliver your product is to sell them to your customers directly, you will use direct selling as your intermediaries. Otherwise, you will use indirect selling, which may involve multiple intermediaries.
Once you have completed the list, you can start researching each of the potential intermediaries. Start by browsing through the internet to know their potentials. You may also invite them over a cup of coffee to talk about a possible distribution agreement . The main goal here is to get to know about the potential intermediaries and the potential partnership that you can develop.
Assuming that you know enough about your potential customers and partner intermediaries, choose the distribution channel that will fit the result of the research that you have conducted. To maximize your profit, you can use multiple channels in your distribution channel strategy .
To gain more profit, many companies get involved with important causes as part of their marketing plan . That could be a great move, considering that people appreciate accomplice. However, as a business leader, you should also think of the possible result of your company’s action. Use the information that you have gathered from this article and strategically plan the distribution of your products.
Free 10+ call option agreement samples in ms word | pdf, free 10+ advertising agreement samples in ms word | google docs | apple pages | pdf, free 10+ car agreement samples in ms word | google docs | apple pages | pdf, free 10+ horse agreement samples in ms word | apple pages | pdf, free 10+ option agreement samples in ms word | google docs | apple pages | pdf, free 9+ project management agreement samples in doc | pdf, free 20+ distributor agreement samples in pdf | ms word, free 10+ teacher student agreement samples in pdf | doc, free 17+ deed of assignment samples in pdf | ms word, free 20+ land purchase agreement samples in pdf | ms word | google docs | pages, 10+ hotel management agreement samples in pdf | doc, free 18+ car rental agreement samples in pdf | ms word | google docs | pages, free 23+ dealership agreement templates in pdf | ms word | pages, free 11+ vehicle sales agreement samples in pdf | ms word | google docs | pages, free 11+ supply agreement contract samples in ms word | pdf, sample partnership dissolution agreement templates, sample exclusivity agreement template, 10+ sample data analysis, 15+ sample project management plans.
By: Author Tony Martins Ajaero
Home » Business Plans » Oil & Gas Sector
Are you about starting a diesel distribution business? If YES, here is a complete sample diesel supply business plan template & feasibility report you can use for FREE .
Okay, so we have considered all the requirements for starting a diesel distribution and supply business . We also took it further by analyzing and drafting a sample diesel distribution marketing plan template backed up by actionable guerrilla marketing ideas for diesel distribution and supply businesses. So let’s proceed to the business planning section.
The rule of thumb in choosing a business to launch is to look out for a business whose products or services are in high demand. A diesel distribution and supply business is one such business but you must have the right exposure and finances.
If you are sure that this type of business is what you truly want to do after you must have conducted your market research and feasibility studies, then the next step to follow is to write a good business plan; a detailed blue print of how you intend raising your seed capital, setting up the business, managing the flow of the business, sorting out tax and marketing your services amongst other areas.
Below is a sample diesel distribution and supply business plan template that will help you successfully launch your own business.
1. industry overview.
Diesel distribution and supply business is classified under the Fuel Dealers industry and players in this industry sell diesel, heating oil, propane and other fuels directly to end users. Related companies also deliver heating oil, propane and other fuels, such as auto – gas and kerosene, to domestic and commercial premises.
Please note that the Fuel Dealers industry has moderate barriers to entry. Entrepreneurs that intend entering the industry must gain access to cost-effective and reliable sources of heating oil and propane for distribution. They also need to attract a customer base, most commonly away from existing operators. High industry competition limits access to customers.
New operators lack economies of scale because they have few customers when first entering the industry. If customers are geographically distant, transportation costs may be prohibitive due to high per-unit expenses. Since the industry’s products are substitutable, operators differentiate themselves through service and efficiency.
The Fuel Dealers industry is a thriving sector of the economy of the united states of America and the industry generates over billion annually from more than 11,419 registered and licensed fuel dealers (diesel distribution and supply) in the country.
The industry is responsible for the employment of over 78,218 people. Experts project the Fuel Dealers industry to grow at a -5.6 percent annual rate between 2012 and 2017. It might interest you to know that only AmeriGas can boast of having the lion market share of the available market in the United States.
A recent report published by IBISWorld shows that a large majority of Fuel Dealers industry revenue is derived from heating oil and propane sales for household heating purposes.
Revenue generated from these sales fluctuates wildly every year, typically in line with changes in weather conditions and fossil-fuel prices. Revenue grew steadily in 2013 and 2014 as the particularly severe winter in early 2014 led to substantially greater fuel sales.
However, the industry is fighting to maintain its customer base as more buildings are refitted with less-expensive heating units, increasing external competition. Nevertheless, industry revenue is expected to gradually recover over the five years to 2023, largely due to an expected annualized increase of 4.4 percent in the world price of crude oil.
Some of the factors that encourage aspiring entrepreneurs to start a diesel distribution and supply business is the fact that the market is growing rapidly in the United States and it is not seasonal.
That makes it easier for entrepreneur who are interested in the business to come into the industry at any time they desire; the entry barriers might be high but that any serious – minded entrepreneur can comfortably raise the startup capital even if it means collecting loans from the bank.
Over and beyond, the Fuel Dealers industry is a profitable industry and it is open for any aspiring entrepreneur to come in and establish his or her business as long as they are able to obtain the required license and permits; you can choose to start on a small scale and supply on a community level or you can choose to start on a large scale with distribution network spread across key cities all around the United States of America.
Julius Padres® Diesel Distribution Company, Inc. is a registered fuel dealer company that will be involved in the distribution of diesel and other fuels to retailers, industries, household, hotels and restaurants et al. Our warehouse cum administrative office will be located in Waco – Texas.
We have been able to lease a warehouse facility that can fit into the kind of diesel distribution and supply company that we intend launching and the facility has easy delivery network. Julius Padres® Diesel Distribution Company, Inc. will distribute a wide range of fuels such as Diesel, Propane, Heating oil, Gasoline and Automotive fuels to end users at affordable prices.
We are aware that there are several diesel distribution and supply companies and contractors all around Waco – Texas, which is why we spent time and resources to conduct our feasibility studies and market survey so as to offer much more than our competitors will be offering. We have robust distribution network and strong online presence.
Beyond the distribution and supply of diesel, our customer care is going to be second to none in the whole of Waco – Texas and our deliveries will be timely and highly reliable. We know that our customers are the reason why we are in business which is why we will go the extra mile to get them satisfied when they patronize our products.
Julius Padres® Diesel Distribution Company, Inc. will ensure that all our customers are given first class treatment whenever they order diesel and other fuels from us. We have a CRM software that will enable us manage a one on one relationship with our customers no matter how large they may grow to.
Julius Padres® Diesel Distribution Company, Inc. will at all times demonstrate her commitment to sustainability, both individually and as a firm, by actively participating in our communities and integrating sustainable business practices wherever possible.
We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely.
Julius Padres® Diesel Distribution Company, Inc. is owned by Julius Padres. He has a B.Sc. in Business Administration, with over 8 years of hands on experience in the retailing and distribution industry, working for some of the leading brand in the United States.
Julius Padres® Diesel Distribution Company, Inc. is in the industry to distribute a wide range of quality and safe diesel and other fuel products.
We are in the diesel distribution and supply industry to make profits and we will ensure that we do all that is permitted by the law in the United States to achieve our business aim and objectives. Our products and services offerings are listed below;
Our Business Structure
Our intention of starting a diesel distribution and supply business is to build a standard diesel distribution and supply business in Waco – Texas. We will ensure that we put the right structures in place that will support the kind of growth that we have in mind.
We will make sure that we hire people that are qualified, honest, customer centric and are ready to work to help us build a prosperous business. As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of ten years or more.
In view of that, we have decided to hire qualified and competent hands to occupy the following positions that will be made available at Julius Padres® Diesel Distribution Company, Inc.;
Sales and Marketing Manager
Information Technologist
Chief Executive Officer – CEO:
Admin and HR Manager
Depot Manager:
Accountant/Cashier:
Client Service Executive
Distribution Truck Drivers
Our intention of starting out in Waco and distribute our diesel and other fuel products only within Waco – Texas is to test run the business for a period of 3 to 5 years to know if we will invest more money, expand the business and then start our diesel distribution and supply all around the state of Texas.
We are quite aware that there are several diesel distribution and supply companies and contractors all over Waco and even in the same location where we intend locating ours, which is why we are following the due process of establishing a business.
We know that if a proper SWOT analysis is conducted for our business, we will be able to position our business to maximize our strength, leverage on the opportunities that will be available to us, mitigate our risks and be equipped to confront our threats.
Julius Padres® Diesel Distribution Company, Inc. employed the services of an expert HR and Business Analyst with bias in retailing and distribution to help us conduct a thorough SWOT analysis and to help us create a Business model that will help us achieve our business goals and objectives.
This is the summary of the SWOT analysis that was conducted for Julius Padres® Diesel Distribution Company, Inc.;
Our location, the business model we will be operating on (robust distribution network), reliable distribution tankers, varieties of payment options, wide range of diesel and other fuel products and our excellent customer service culture will definitely count as a strong strength for us.
So, also our management team are people who have what it takes to grow a business from startup to profitability within record time.
A major weakness that may count against us is the fact that we are a new diesel distribution and supply business and we don’t have the financial capacity to compete with leaders in the industry especially as it relates to economy of scales.
The fact that we are going to be operating our diesel distribution and supply business in Waco – Texas provides us with unlimited opportunities to distribute our products to a large number of factories, retailers, households and businesses.
We have been able to conduct thorough feasibility studies and market survey and we know what our potential clients will be looking for when they patronize our products and services; we are well positioned to take on the opportunities that will come our way.
Just like any other business, one of the major threats that we are likely going to face is economic downturn. It is a fact that economic downturn affects purchasing / spending power. Another threat that may likely confront us is the arrival of a similar business in same location.
Distribution of goods has been in existence for as long as human started trading goods, but one thing is certain, the distribution industry is still evolving. The introduction of technology has indeed helped in reshaping the industry.
The trend in the fuel dealer industry shows that as oil and natural gas prices decrease, industry revenue is expected to decline, industry operators have tried to cut prices to discourage customers from switching to natural gas and customers will likely transition from propane to natural gas due to price differentials.
Please note that external factors such as world price of crude oil and world price of natural gas will always impact industry performance.
Lastly, it is now a common phenomenon for diesel distribution and supply companies to leverage on technology to effectively predict consumer demand patterns and to strategically position their business to meet their needs; in essence, the use of technology helps diesel distribution and supply businesses to maximize supply chain efficiencies.
The diesel distribution and supply industry has a wide range of customers; a good number of households, hotels, and manufacturing companies make use of diesel and other fuel products and it is difficult to find people around who don’t.
In view of that, we have positioned our company to service businesses in Waco – Texas and every other location we will cover. We have conducted our market research and we have ideas of what our target market would be expecting from us. We are in business to retail (distribute) diesel and other fuel products to the following businesses;
Our competitive advantage
Julius Padres® Diesel Distribution Company, Inc. is launching a standard diesel distribution and supply business that will indeed become the preferred choice in Waco – Texas. Our competitive advantage revolves around our ability to attract local support and patronage, easy compliance with government regulations and having a loyal customer base.
One thing is certain; we will ensure that we have diesel and other fuel products available in our warehouse at all times. One of our business goals is to make Julius Padres® Diesel Distribution Company, Inc. a one stop diesel distribution and supply company.
Our excellent customer service culture, timely and reliable delivery services, online presence, and various payment options will serve as a competitive advantage for us.
Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category in the industry meaning that they will be more than willing to build the business with us and help deliver our set goals and achieve all our aims and objectives.
We will also give good working conditions and commissions to freelance sales agents that we will recruit from time to time.
Julius Padres® Diesel Distribution Company, Inc. will generate income by offering the following services and products.
One thing is certain when it comes to diesel distribution and supply business, if your business is centrally positioned coupled with effective and reliable distribution network, you will always attract customers cum sales and that will sure translate to increase in revenue generation for the business.
We are well positioned to take on the available market in Waco – Texas and we are quite optimistic that we will meet our set target of generating enough income/profits from the first six months of operation and grow the business and our clientele base.
We have been able to examine the diesel distribution and supply industry, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below are the sales projections for Julius Padres® Diesel Distribution Company, Inc., it is based on the location of our business, and other factors as it relates to diesel and other fuel products startups in the United States;
N.B : This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor offering same products and distribution services as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.
Before choosing a location to launch Julius Padres® Diesel Distribution Company, Inc., we conducted a thorough market survey and feasibility studies in order for us to be able to penetrate the available market and become the preferred choice in Waco – Texas.
We have detailed information and data that we were able to utilize to structure our business to attract the number of customers we want to attract per time.
We hired experts who have good understanding of the retailing and distribution industry to help us develop marketing strategies that will help us achieve our business goal of winning a larger percentage of the available market in Waco – Texas.
In summary, Julius Padres® Diesel Distribution Company, Inc. will adopt the following sales and marketing approach to win customers over;
Even though our diesel distribution and supply business is well structured and well located, we will still go ahead to intensify publicity for the business.
Julius Padres® Diesel Distribution Company, Inc. has a long-term plan of opening distribution channels all around the state of Texas which is why we will deliberately build our brand to be well accepted in Waco before venturing out. Here are the platforms we intend leveraging on to promote and advertise Julius Padres® Diesel Distribution Company, Inc.;
Pricing is one of the key factors that gives leverage to distribution companies and retailers, it is normal for retailers to purchase products from distribution companies that offer cheaper prices. We will work towards ensuring that all our diesel and other fuel products are distributed at highly competitive prices compared to what is obtainable in the United States of America.
We also have plans in place to discount our diesel and other fuel products once in a while and also to reward our loyal customers from time to time.
The payment policy adopted by Julius Padres® Diesel Distribution Company, Inc. is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.
Here are the payment options that Julius Padres® Diesel Distribution Company, Inc. will make available to her clients;
In view of the above, we have chosen banking platforms that will enable our client make payment for diesel and other fuel products purchase without any stress on their part.
Having done our due diligence , this is what it would cost us to set up Julius Padres® Diesel Distribution Company, Inc. in the United of America;
We would need an estimate of $1.5 million to successfully set up our diesel distribution and supply business in Waco – Texas.
Generating Startup Capital for Julius Padres® Diesel Distribution Company, Inc.
Julius Padres® Diesel Distribution Company, Inc. is a private business that is solely owned and financed by Julius Padres. He has decided to restrict the sourcing of the start up capital to 3 major sources.
N.B: We have been able to generate about $500,000 ( Personal savings $450,000 and soft loan from family members $50,000 ) and we are at the final stages of obtaining a loan facility of $1 million from our bank. All the papers and documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.
The future of a business lies in the number of loyal customers that they have, the capacity and competence of their employees, their investment strategy and business structure. If all of these factors are missing from a business, then it won’t be too long before the business closes shop.
One of our major goals of starting Julius Padres® Diesel Distribution Company, Inc. is to build a business that will survive off its own cash flow without the need for injecting finance from external sources once the business is officially running.
We know that one of the ways of gaining approval and winning customers over is to supply/distribute our diesel and other fuel products a little bit cheaper than what is obtainable in the market and we are prepared to survive on lower profit margin for a while.
Julius Padres® Diesel Distribution Company, Inc. will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.
As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of three years or more. We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.
Check List/Milestone
IMAGES
COMMENTS
PlanBuildr's Distribution Company business plan template will help you to quickly and easily complete your Distribution Company business plan.
A distribution plan assists companies in ensuring that their goods reach their intended customers at the correct time and location.
Get Growthink's distribution business plan template & step-by-step instructions to quickly & easily create your distribution company business plan.
A distributor business plan is a document where you can write the goals of your business, the methods or processes that you will use to attain these goals, and a realistic time-frame to achieve them. Learn more about it by reading this article.
The written part of a distribution business plan. A comprehensive business plan for your distribution company contains seven key sections: executive summary, presentation of the company, products and services section, market analysis, strategy section, operations section and financial plan. 1.
Are you about starting a food and beverage distribution business? If YES, here is a complete sample beverage distribution business plan template & feasibility report you can use for FREE.
Distribution strategy is a plan to reach customers to sell to them and to deliver your products and services. This is an element of marketing strategy that also has the operational and logistics component of getting your products to customers.
Wholesale Bicycle Distributor Business Plan. Wheelie Deals is a wholesale distributor of bicycles and bicycle parts, focusing on closeouts, discontinued models, seconds, etc. Before you write a business plan, do your homework. These sample business plans for wholesale and distribution businesses will give you the head start you need to get your ...
Sticking to a well written business plan comes with a slew of benefits. Including being able to come up with ideas without investing too many resources in it. To properly get acquainted with with a distribution business plan, check out these samples that we have listed down below. After getting the gist of the document, you can then use these samples as a guide or even as a template for when ...
Explore a real-world coffee distribution business plan example and download a free template with this information to start writing your own business plan.
Use this free Distribution Company business plan template to easily create a great business plan to start or grow your business.
Distribution business model is a business model that facilitates that distribution of goods and services from the producers / manufacturers to the end users / consumers; it is a business model that ensures that products and services reach target customers in the most direct and cost-efficient manner. If it is services, distribution is ...
This Distribution Plan template is designed to help supply chain and logistics teams plan and optimize the distribution of products or materials. It can be used by anyone responsible for designing and executing a distribution plan, including supply chain managers, logistics specialists, and warehouse personnel. 1.
When it comes to starting a business as a wholesale distributor, or scaling a business to include it, it's essential that things be ready to start running as soon as operations begin, which is where a wholesale business plan comes into play. Wholesale plays an important role in the supply chain of a retail business. Starting operations without the right preparation can cause major problems ...
The distribution business is one of the most challenging, yet lucrative trades to get into at the same time. If planned properly and effectively, you could come out on top of the distribution game, and as a solid business in the market to contend with. And all you need to make that happen is a good, well-prepared distribution sales plan. Download our distribution sales plan templates. They ...
Explore what distribution strategy is and examples of it, plus discover distribution channels and types to help you better understand this aspect of business.
Learn how to craft your own business plan with our guide of templates, examples, and tips.
Joining the distribution trade bandwagon can be a bit challenging. But with the right tool in place, you'll be running your business like a pro! The very tool that you need is a well-crafted distribution business plan template. Download our distribution business plan templates now. Our templates are ready-drafted, easy to fill out and to follow, and very convenient to use. Start your ...
A product distribution strategy can be defined as a strategic plan to deliver products or services to consumers or end-users. Companies can distribute products through direct or indirect distribution strategies. In some situations, companies use multiple types of distribution methods to deliver products to different types of customers.
In order to create a comprehensive distribution plan, businesses need to assess the assets required to successfully execute. To get started, a business needs data that includes information about its product or service and an understanding of the customer demographics and demand. Finally, the business needs to identify the best distribution ...
In the marketing section of your business plan, summarize your promotion strategy, taking care to describe how it supports the product, pricing, and distribution strategies your business will follow over the business plan period. When appropriate, include samples of marketing materials (letterhead, business cards, website screens, brochures ...
A distribution plan is a component of the strategic planning of a business that consists of the details of how the producers deliver goods and services to its customers. Learn more about the distribution plan by clicking this link.
Okay, so we have considered all the requirements for starting a diesel distribution and supply business. We also took it further by analyzing and drafting a sample diesel distribution marketing plan template backed up by actionable guerrilla marketing ideas for diesel distribution and supply businesses. So let's proceed to the business planning section.