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Sample Business Plan

Sample Business Plan from Colin Duguid MICM

BUSINESS PLAN for

Acme Training Services & Computer Sales February 2000

For Barwest Bank plc INDEX 1.

Summary of Business Plan a. Introduction to Acme Business Services & Co b. Product: Computer Sales c. Product: Training Services d. Why the Business will Succeed e. Financial Summary

2.

Management a. Proprietor: Employment Record b. Junior Partners: Brief Summary c. How and Why the Business Started

3.

Product / Service a. Computers Sales b. Printer Sales c. Training Sales

4.

Marketing a. The Market Size b. Future Growth c. Market Sector d. Expected Client Profile e. Competitors

5.

Sales

a. Advertising b. Promotion c. Who will Sell d. The Unique Selling Points e. Setting the Price 6.

Operational a. Location b. Equipment and Costs To-date c. Equipment Required d. Staff

7.

Short - Medium Term Trading a. Objective Short Medium-term b. What if ? - contingency plans

8.

Financials

9.

Contact Details

Summary of Business Plan

Page 1

a.

Introduction to Acme Training Services & Computer Sales Acme Training Services & Computer Sales has been established for two months, and trade on a regional basis. There are currently two partners: John Smith (28) and Jane Jones (25), who have extensive experience of computers and training.

b.

Product: Computer Sales John Smith has been building computers for five years for the well known firm BuildComputer.com and he has access to favourably priced computer parts. The computers are aimed at the corporate market, with service contracts available.

c.

Product: Training Services Jane Jones has been involved in computer training for for 5 years, the last two years as an independent consultant. Jane specializes in cutting edge technology. The planned courses run for 2 - 3 days, with quarterly 1-day progress and update courses to keep those under training up to date with the latest technology.

d.

Why the Business will Succeed Jane and John compliment each other: John worked for his father for four years as an office manager in a small manufacturing company, as such he has strong managerial skills to compliment Jane's ability to easily digest new technology and her undoubted skills in technology training. Further, both parties bring existing business and network contacts. Both parties believe that they could increase their own business areas by 200% within 6 - 12 months if they could delegate some less skillful areas within their current work schedules..

e.

Financial Summary As you will see from the enclosed financials, the markup is 40% with an expected profit of £90,00 in the first year. They have £20,000 capital to invest in the company

and seek further funds of £40,000 from a lender - secured on Johns property. An overdraft facility of £15,000 is also required to finance larger than expected growth if cash flow is limited due to increased costs.

Management f.

Page 2

Proprietor: Employment Record John Smith - CV attached Aged 28, John with City & Guilds Computer Studies (1994), has always had responsible positions in his career to-date. Working for his fathers manufacturing company as office manager for five years up to 1995: where his interest in computers began. For the past three years John worked for WeBuildComp.com as Computer Services Manager and has gained much experience of 'blue chip' requirements. John has been married for 4 years with two young children. Jane Jones - CV attached Aged 25, Jane with three A Levels in English, History and Art, has always sought positions that allow her to use her skills as a communicator and organiser. Jane worked for the leading firm WinMac Training Systems for three years before branching out as a successful independent training consultant for the past two years.

g.

Other: Brief Summary John Smith's father, Richard Smith, will be assisting with the initial setup of the manufacturing outlet. He is retired after running his own successful manufacturing business for 40 years. And of course, he will be available as an ongoing source of help and advice. Two other suitable individuals have been sounded out for management positions and are keen to be involved with this venture.

h.

How and Why the Business Started Jane and John worked for the same client about a year ago and have used each others services on an informal basis since then. They believe that actively sourcing business for each other as a combined service will give them 'first sight' of opportunities.

Product / Service i.

Page 3

Computer Sales Three standards of computers will be built: RS 01 350 MHz 32MB 6.4GB 15" Screen RS 02 450 MHz 64MB 6.4GB 15" Screen RS 03 550 MHz 128MB 12.6GB 17" Screen Each machine can have a number of specified add-on's: CD ROM, DVD, Modem The machine will built in their own manufacturing unit, with service for the first year on the client's site. Servers will be purchased as required to the specifications of the client.

j.

Printer Sales A number of leading laser and ink jet printers will be available, with the anticipated

service contracts as a major source of income. k.

Training Sales Four levels of training will be available:

i.

Trainee up to 8 persons with no, or little, computer experience

ii.

Basic up to 8 persons with basic computer skills

iii.

Intermediate up to 8 persons who have a good working knowledge of computer systems

iv.

Advanced up to 4 persons who understand technical computer systems

Marketing

Page 4

b.

The Market Size Currently, corporate computer sales are rising at 15% per quarter. It is expected to continue at that rate for another two years. There are few business's that will avoid using a computer in those two years. The ability to configure a network of computers will be an important requirement.

c.

Future Growth The computer is still not integrated within 75% of UK business's. The computer will not be superceded within the next five years, and even then it is hard to see a dramatic change in hardware that will not be backward compatible.

d.

Market Sector Based in Manchester the need for computer hardware and training is always available. SME Office space is increasing by 10% per annum. There are currently 95,000 SME's in Manchester.

e.

Expected Client Profile  Small Medium Enterprise (SME) Computer Sales  Medium - Large Companies for Training Services  Commerce and Industry  Turnover £2m +  Initially: Manchester and Districts  Prefer client to be computer literate

b.

Competitors COMPUTERS Six companies have been identified as true competitors i.e. computer and peripheral sales and service direct to corporate clients on-site. The three main competitors are: ABC Computers Established 6 years, turnover £0 (Not Known), 6 staff, no growth in past two years Bell & Son PC's Established 4 years, turnover £2m, 10 staff, specialist computer systems, steady growth

Corporate Comps (National Company) Established 2 years, turnover £7.5m, 40 staff, mainly top end clients, always stretched Summary Service complaints are common with all competitors, and hardware upgrades are long overdue. Corporate Comps are looking to revamp their national operation in the spring. TRAINING Three companies currently service the above client profile in computer training. Top two are: Easy Train Established 15 years, turnover £900,000, computer training staff 4, no plans for rapid growth The PC Training Co. (National Company) Established 8 years, turnover £6.5m, computer training staff 35, no local office Summary At present demand exceeds resources. No effective competition is challenging the top companies, who offer only limited cutting edge technology training skills.

Sales c.

Page 5

Advertising An advert has been placed in the:  'Computer Sales' and 'Training' sections of Yellow Pages  The Tuesday business section of the Manchester Regional News (on going)  PCMAC Computer Monthly magazine

d.

Promotion  Targeted mail shot within 3 months  Telesales company to start promotion within 1 month  Two regional computer shows booked - 1st in 2 months 2nd in 6 months

e.

Who will Sell Both proprietors are competent sales negotiators

f.

The Unique Selling Points  Dual capability of hardware supplier and training provider  Latest technology training package  Availability

g.

Setting the Price COMPUTERS Prices include 1 year on-site total cover RS 01 350 MHz 32MB 6.4GB 15" Screen £650.00

RS 02 450 MHz 64MB 6.4GB 15" Screen £800.00 RS 03 550 MHz 128MB 12.6GB 17" Screen £950.00 PC Service contracts are £150 per annum for one PC and then £85 for each additional PC Printer £50 per annum for one, then £30 for each additional unit TRAINING £110 Per Day Trainee up to 8 persons with no, or little, computer experience £135 Per Day Basic up to 8 persons with basic computer skills £180 Per Day Intermediate 8 persons, a good working knowledge of computer systems £295 Per Day Advanced up to 4 persons who understand technical computer systems 20% reduction for in-house training

Operational

Page 6

h.

Location New office-warehouse development on Industrial Estate located 3 miles from city centre. Development has three meeting/conference rooms of high standard. 3 year lease - no payment for first 3 months, then £3,000 per quarter in advance.

i.

Equipment and Costs To-date OFFICE 6 x Tables 6 x Chairs 3 x Filing cabinet 2 x Computer laser printer Ink jet printer Photocopier Fax Answer phone 2 x Phone line Stationary and printing Sub Total

WAREHOUSE 4 x Work bench 8 x Stack shelving Lighting

475 350 210 875 375 300 1200 250 100 150 1100 5385

Sub Total

2000 1500 750 4625

STOCK Computer parts TOTAL

3750 £13,860

j.

Staff A mature office manager, and a trainee computer assembler will be sufficient for the initial 3 months - between 3 and 9 months two training staff (to cover Trainee and Basic training) and a junior office clerk will be employed. At 9 months a review of staff needs will take place.

Short - Medium Term Trading k.

Page 7

Objective Short-term COMPUTERS An average of 5 computer sales per week, and 2 service contracts. The trainee assembler to be competent at assembly within 6 months, and to service a computer on site within 9 months. TRAINING Jane training for average of 3 days per week within 3 months. New training staff to be working an average of 4 days per week by 9 months. At the 12 month plus period, a number of Jane and John's tried and tested ex-colleagues and friends will be approached to join the company with equity available.

l.

What if ? - contingency plans Both John and Jane are confident (with good reason) that a contingency plan is unlikely to be needed, however, John has contacts who can provide him with computer fitting and servicing without notice, and likewise Jane with her training contacts. In a real emergency, say, John or Jane became ill, it is anticipated that the new staff could continue with 'basic' computer servicing or training the requirement of a mature Office Manager is a strategic and important position.

Financials m.

Page 8

Monthly Profit & Loss Account (P&L)-projected for 2 years 2000 to 2001 Net Profit £ 90,000 2001 to 2002 Net Profit £175,000 As you can see from the P&L the business is expecting to make a net profit of £90,000 in the first year. The figures include the salary of the full compliment of staff as outlined on page 6 (c) above. The second year shows a net profit of £275,000: if this does happen they will purchase their own premises for £180,000. The total compliment of staff at the end of 2002 is 25.

n.

Balance Sheet projected for 2 years 2000 to 2001 Net Assets £130,000 2001 to 2002 Net Assets £260,000 The projected figures show the anticipated reinvestment of all profits for the first two years: this trend will continue. Stock at the end of the second year is high but the discounts on bulk purchase is a profitable option in

the computer industry, if technology allows. o.

Monthly Cash Flow Forecast for 2 years 2000 to 2001 Year-End Net Cash Flow £ 25,000 2001 to 2002 Year-End Net Cash Flow £120,000 In the first year the cash flow will remain positive unless an opportunity to buy bulk computer parts presents it's self. Likewise the entire second year is planned to be in the black and consideration will be given at that time as to the purchase of assets. [N.B. If you are an existing company your audited accounts for up to three years are usually required - More info about the above Profit and Loss Accounts to be added soon]

Contact Details John Smith 01234 9876543

End Page Office Unit 3 The Trading Estate The Avenue MANCHESTER M23 4SA

Jane Jones 01234 9876543

019671 3546387

Home

01234 1234567

09876 1234567

Mobile

017790 9876544

96 Avenue Hill MANCHESTER M34 5RR

Home Address

12 High Road MANCHESTER M12 3AA

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