How to set up a business|for busness people
Oct
15
Filed Under (Make Money) by
Desmond O asked:
I’m planning to get a business degree in the United States but I’m am unsure of what type of business I should major in or even where should i study in.
I’m planning to get a business degree in the United States but I’m am unsure of what type of business I should major in or even where should i study in.
I’m more of an entrepreneur-minded person and I have look into Business Administration for some time now. I’m more of creative person and I love to challenge new ideas.
I am also looking for a university that offers cheap and reasonable fee and good education with good credibility. I’m currently looking into University of Nebraska but I am also interested in other options.
Thnx
Frank
Oct
14
Filed Under (Make Money) by
Smith & Chen asked:
Small business grants are not just given away by government agencies or private institutions for helping you start your business. There needs to be a particular interest in your project in order for them to provide the funding that you need. And it’s not enough to have a good idea in order to obtain finance for it; you need to have a well made business project to convince them of your eligibility.
No Credit Or Income Requirements?
Though there is no need to reimburse the money on government grants, claims that state that there is no credit or income requirement in order to get approved for a government grant are far from being truth. Truth is that the requirements for approval are not present in the same sense as on private or federal loans but there is still a qualification process.
You may wonder then, what is needed in order to qualify for a government grant. The idea is that you’ll need to show that your business project is viable, and thus, you’ll need to show that you can be trusted which implies having a fair credit score and the ability to generate a proper income to show proof of the business viability.
Presenting a Viable Business Project
What you need to understand is that prior to requesting a government grant, you’ll need to prepare a presentation of your business project. This obviously implies having a project and not just a mere idea. There must be certain degree of research done with market analysis to prove the viability of the business and the income generation capacity.
Though the money doesn’t need to be returned, the government agency is interested in investing the money in a project that will endure in time and that will keep generating job positions and revenues thus boosting the economy and the welfare of the nation. The particular requirements of each government grant need to be consulted with the government agency that provides them.
Getting Approved For a Government Grant
The key to getting approved for a government grant is to present an appealing business project that shows great feasibility and relates to those fields that the government is interested in promoting. If you don’t meat the requirements for a government grant approval, there is not much you can do about it. Yet, if you do qualify, it is important to be well informed prior to applying in order to take the proper steps and avoid getting declined due to bureaucratic reasons.
If you can’t qualify for a government grant, don’t despair and use the opportunity to consult about government business loans that are sometimes offered with subsidized interest rates and very affordable payments.
Business Grants
One of the best places to research the availability of business grants and loans is the Small Business Administration, an agency of the federal government with a mandate to help business, especially small business succeed. Despite what many people tell you, the idea that the government is just sitting around with a pile of money waiting to give out to you or any other small business is just plain wrong. The idea of obtaining a small business grant, for many small business owners, is great.
Your chances of obtaining grants for your business dramatically increase if you have a non-profit organization. This isn’t to say that assistance isn’t available at all, just that grants are probably a long process when and if you happen to find one where your small business fits. While the Small Business Administration does not have any monies to provide directly for business grants and loans they can direct businesses to a number of government agencies and departments that do provide this type of assistance.
Even though the category of Business and Commerce may be what appears to have the largest selection of resources for business grants for women, consider the other categories as well, according to where your business falls. There are many types of grants offered by the Governments and other financial institutions that include individual grants for personal necessities, business grants for starting new business, education grants for funding education and many more. There are two main types of financing available for small businesses; small business grants and small business loans.
You’re not along if you need small business grants and loans to get your business started. If you want to avail of free government business grants then you need to locate a program that provides grants to start up businesses. Government’s Catalog of Federal Domestic Assistance (CFDA) provides a listing of Government grants and other types of assistance that you can receive.
The downside of grants is that business grants for women are not widely available. So, are there any grants available to you as a small business owner? New business owners and existing business owners are eligible to apply for business grants.
Small business administration grants are provided for small businesses that are already in operation. Small businesses always play a significant role in the economic growth of a country and that is the reason governments are always ready to offer financial resources to facilitate small business. This type of service offered by the government is only obtainable to businesses that barely needs a financial support but can not apply for a loan because of inadequate security.
There are indeed many grant and loan programs for small businesses, including many that are administered by state or local government, rather than the federal government. Having pointed to the drawbacks, there are many genuine government grants for both small businesses and individuals available, and these can be substantial. That’s you’ll actually be able to access whatever grants, services and resources are available, because the nonprofit organizations are the ones who work with indidivuals and provide “service delivery.
First, let’s take a look at what type of grants are available. The allure of these so-called small business grants is understandable. If you are interested in looking for a company that can provide you with small business administration grants, you can try searching through the World Wide Web for information.
If you are considering starting your own home business in the near future you should consider researching small business grants and loans now. Federal Grants provides detailed information on Federal Grants, Federal Pell Grants, Federal Government Grants, Federal Grants For Small Business and more. Small Business Loans provides detailed information on How To Get A Small Business Loans, Minority Small Business Loans, Small Business Bad Credit Loans, Small Business Government Loans and more.
To conclude, small business loans are usually awarded to all kinds of businesses to help them to begin and to succeed in their trading. The government is more than willing to help out businesses especially with the economic condition that still remains volatile and unpredictable and with the need for more economic development.
Paine
Small business grants are not just given away by government agencies or private institutions for helping you start your business. There needs to be a particular interest in your project in order for them to provide the funding that you need. And it’s not enough to have a good idea in order to obtain finance for it; you need to have a well made business project to convince them of your eligibility.
No Credit Or Income Requirements?
Though there is no need to reimburse the money on government grants, claims that state that there is no credit or income requirement in order to get approved for a government grant are far from being truth. Truth is that the requirements for approval are not present in the same sense as on private or federal loans but there is still a qualification process.
You may wonder then, what is needed in order to qualify for a government grant. The idea is that you’ll need to show that your business project is viable, and thus, you’ll need to show that you can be trusted which implies having a fair credit score and the ability to generate a proper income to show proof of the business viability.
Presenting a Viable Business Project
What you need to understand is that prior to requesting a government grant, you’ll need to prepare a presentation of your business project. This obviously implies having a project and not just a mere idea. There must be certain degree of research done with market analysis to prove the viability of the business and the income generation capacity.
Though the money doesn’t need to be returned, the government agency is interested in investing the money in a project that will endure in time and that will keep generating job positions and revenues thus boosting the economy and the welfare of the nation. The particular requirements of each government grant need to be consulted with the government agency that provides them.
Getting Approved For a Government Grant
The key to getting approved for a government grant is to present an appealing business project that shows great feasibility and relates to those fields that the government is interested in promoting. If you don’t meat the requirements for a government grant approval, there is not much you can do about it. Yet, if you do qualify, it is important to be well informed prior to applying in order to take the proper steps and avoid getting declined due to bureaucratic reasons.
If you can’t qualify for a government grant, don’t despair and use the opportunity to consult about government business loans that are sometimes offered with subsidized interest rates and very affordable payments.
Business Grants
One of the best places to research the availability of business grants and loans is the Small Business Administration, an agency of the federal government with a mandate to help business, especially small business succeed. Despite what many people tell you, the idea that the government is just sitting around with a pile of money waiting to give out to you or any other small business is just plain wrong. The idea of obtaining a small business grant, for many small business owners, is great.
Your chances of obtaining grants for your business dramatically increase if you have a non-profit organization. This isn’t to say that assistance isn’t available at all, just that grants are probably a long process when and if you happen to find one where your small business fits. While the Small Business Administration does not have any monies to provide directly for business grants and loans they can direct businesses to a number of government agencies and departments that do provide this type of assistance.
Even though the category of Business and Commerce may be what appears to have the largest selection of resources for business grants for women, consider the other categories as well, according to where your business falls. There are many types of grants offered by the Governments and other financial institutions that include individual grants for personal necessities, business grants for starting new business, education grants for funding education and many more. There are two main types of financing available for small businesses; small business grants and small business loans.
You’re not along if you need small business grants and loans to get your business started. If you want to avail of free government business grants then you need to locate a program that provides grants to start up businesses. Government’s Catalog of Federal Domestic Assistance (CFDA) provides a listing of Government grants and other types of assistance that you can receive.
The downside of grants is that business grants for women are not widely available. So, are there any grants available to you as a small business owner? New business owners and existing business owners are eligible to apply for business grants.
Small business administration grants are provided for small businesses that are already in operation. Small businesses always play a significant role in the economic growth of a country and that is the reason governments are always ready to offer financial resources to facilitate small business. This type of service offered by the government is only obtainable to businesses that barely needs a financial support but can not apply for a loan because of inadequate security.
There are indeed many grant and loan programs for small businesses, including many that are administered by state or local government, rather than the federal government. Having pointed to the drawbacks, there are many genuine government grants for both small businesses and individuals available, and these can be substantial. That’s you’ll actually be able to access whatever grants, services and resources are available, because the nonprofit organizations are the ones who work with indidivuals and provide “service delivery.
First, let’s take a look at what type of grants are available. The allure of these so-called small business grants is understandable. If you are interested in looking for a company that can provide you with small business administration grants, you can try searching through the World Wide Web for information.
If you are considering starting your own home business in the near future you should consider researching small business grants and loans now. Federal Grants provides detailed information on Federal Grants, Federal Pell Grants, Federal Government Grants, Federal Grants For Small Business and more. Small Business Loans provides detailed information on How To Get A Small Business Loans, Minority Small Business Loans, Small Business Bad Credit Loans, Small Business Government Loans and more.
To conclude, small business loans are usually awarded to all kinds of businesses to help them to begin and to succeed in their trading. The government is more than willing to help out businesses especially with the economic condition that still remains volatile and unpredictable and with the need for more economic development.
Paine
Comments Off
Oct
09
Filed Under (Make Money) by
Michael Gregory asked:
Before embarking on writing a business plan for starting a car wash, a definition of what a business plan is in order. A business plan is a document to identify an opportunity, research why this opportunity is profitable and the steps needed to capitalize on the opportunity. The business plan can be a formal document or it can be written on the back of a napkin but the mere act of writing the idea down forces you to get the idea out of your head and on paper which helps find hidden business flaws and makes you think carefully about each phase of your business.
Creating a business plan is something anyone can do, even if you don’t know anything about business or finances. Even though the business plan is critical to getting the idea off of the ground, many entrepreneurs procrastinate when it comes to preparing a written plan. If you don’t know anything about business or finances, this is the best time to begin learning as the chances of your business being successful will be limited without this knowledge. Just as a builder won’t begin construction without a blueprint, entrepreneurs shouldn’t rush into new ventures without a plan. The old saying that “those who fail to plan, plan to fail” is very relevant when talking about starting a business. SBA’s statistics claim over half of new businesses fail in the first three years and the common factor is poor planning or under-capitalization (which is also poor planning).
Getting Started
The first step in creating a business plan is just getting started. Writing the business plan may seem overwhelming at first, but if you break the plan down to bite sized pieces and work on one section at a time won’t seem as daunting. Begin with what you know first and describe your business and your product or services. Work towards the more difficult subjects such as marketing, operations and financials. Don’t worry about it being perfect now, just get the concepts on paper – expand and refine later. If you get stuck on a section in the plan, skip it for now and come back later when you have more details.
Who is your audience?
When writing your car wash business plan, you need to keep in mind who your intended audience is and why you are writing the plan. Why? A plan for the bank will be less interested in the exit strategy and return on investment than one for equity investors. Additionally, a plan for written for internal use will be different than one looking for financing as a bank is not necessarily interested in detailed operations of the business.
Structure
Business plans tend to have a lot of elements in common. While there is not a format that all business plans follow, there are generally accepted guidelines that most follow as the order in which the subjects flow are not random. The Business Description of a business plan is aimed at painting a picture of your business and why this business will be successful. The Marketing, Management and Operations sections are researched and a strategy of how your business will compete and operate is developed. Last financial projections show in numbers what you explained in the business plan for the sales and expenses.
Breaking these three major sections down even further, a business plan consists of six key components:
Executive Summary
Business Description
Marketing
Managers & Employees
Operations & Location
Financial Projections
In addition to these sections, a business plan should also have a cover, title page and table of contents.
How Long Should Your Business Plan Be?
The answer that nobody liked in school applies to a business plan which is, “as long as it needs to be”. The more complex a business or the more sophisticated investors or funds requested will increase the length of a plan. An average car wash business plan narrative should be 4-15 pages plus financials and appendix items.
Business Plan Outline
Executive Summary
The executive summary is the first part of the business plan but is the last to be written. It gives the reader a quick glance of what your business proposal is about and what you are asking for. This part is critical as most readers will scan this section before deciding whether to read further.
The executive summary should typically be about one-half of a page in length and include what you would cover in an elevator pitch such as:
Explain the condensed version of the business concept
Product description or service proposition
This section should emphasize any unique features or benefits that what is currently in the industry or area, aka why would someone buy your product over the competition.
The demographics of your market
The Management team
When the anticipated start date is
Your equity position
How much are you asking for
Concise is the key in the executive summary. You will go into more detail later in the business plan.
Business Description
The purpose of the business description is to objectively describe the car wash business details and future potential include:
Mission
What the business does
Description of products and/or services
Industry information
Business Organization
Status of the business (start-up, expansion or purchasing)
Current and future goals
Any facts or figures should be noted and sources included in the business plan. This information is important should you need to defend your data and assumptions. The business description is where you are trying to paint a picture of the potential of your business along with the facts to support it. Try to inject energy and excitement to get the reader enthusiastic about the idea, without going overboard of course.
After describing the business, it is time to describe and additional products or services your car wash is selling. Keep in mind that it is important to show how your products and services are better than the competition. If you don’t have a good answer than you should rethink your strategy. What is it about your car wash that is going to get the customer to change doing business with the competition?
Marketing
A very important part of your business plan is the marketing section. Regardless of the quality of your products and your services, your business will be lost in the clutter of advertising. If you don’t know your customers, how will they ever find you? All of this begins with doing some research.
Customers: Who Is Your Market
The first step is to determine who you are going to sell to by identifying common characteristics of your market such as age, income, race, religion, education, interests and/or geographic locations. While everyone will want to wash their car product how are you going to effectively advertise to everyone and still make a profit? What you need to do instead is determine the group or groups of people who are most likely to use your car wash services and market to them. After all you are trying to generate a positive return on your marketing dollars, so use them wisely.
Competition
In today’s ultracompetitive marketplace, there is going to be competition, no matter how creative your business concept is. Attempting to run a portion of your car wash business better than the competition may be a difficult challenge so it is often better to focus on planning on being different and competing with them less directly. Can you serve a particular market niche such as the elderly that isn’t being looked at? Can you identify a unique operations/marketing/distribution strategy with a mobile approach? Even if you don’t have direct competition in your area meaning someone selling the same or similar products/services, you will have indirect competition for replacement products/services. If you indicate in your plan there is no competition it will be viewed that there is either no market for your product or you have not done your research.
Optimally you will want information on at least three but no more than five competitors. List information about who they are, how long they have been in business, location, products or services offered, perception on pricing, quality, etc. and compare your advantages and disadvantages. If the information you are looking for is not available online, you may need to pretend you are a customer to get some of this information.
Distribution – How Will You Get the Product To The Customer: By looking at who your market and competition is, you will have an idea of how to get your product to them. Perhaps through your research you will find a strategic advantage to serve the customer that the competition does not.
Promotional Strategy
With the above steps researched, the promotional strategy follows. The promotional strategy is where most entrepreneurs fail as they use the blanket statement that they are going to advertise in the newspaper, radio and/or television without thinking through the process or the customer. The promotional strategy provides you a map of how you are going to reach your market in the most efficient manner possible. Advertising is expensive, use it wisely.
Sales Projections
On of the more difficult areas of the business plan is coming up with sales projections. This number is probably going to be wrong and that’s ok. What you want is a figure backed up with justifiable data. Just grabbing a number out of the air saying you will make $300,000 won’t work. There are many sources to help come up with this number including:
Industry journals
Trade groups
Car washes in similar demographic areas
Industry experts
Census data
Pricing
The effects of pricing play a large role on how your product is perceived in the marketplace. Price too low compared to the competition and your product could be perceived as cheap and unreliable. Price too high with the features and benefits of your product and few customers come through the door. While this is a complex issue, here are a few things to keep in mind.
Make sure you can make a profit at whatever price you are selling at.
If you want to have lower costs and “get your foot in the door” it may be better to offer discounts or coupons initially until your business is better known.
Don’t be afraid to charge more for your product or service than the competition if you have something of more value to offer.
Pricing is the easiest of the marketing mix to change. You may find that a large competitor will under price you to ensure you can’t make a profit and your car wash goes out of business.
Management & Employees
In this section you would describe who is going to manage the business on a daily basis as well as provide strategic direction (if these positions are separate). Each of these people need to have a brief biography included as well as a resume in the appendix. Try to show how the experience and education of these people will be able to successfully execute the strategy in the business plan and succeed. Many times the owner may not have the specific experience for this business, so it is very important to pull their other professional experience in and explain how it will make for a successful operation. Next, a brief explanation of the employees is in order including:
What positions need to be filled
When they need to be filled (This is important in developing financial projections as you may have some employees come on after you start)
How much they get paid (Be sure to calculate payroll taxes as well, estimate 15% if not sure)
It is also recommended to add the professional and advisors to your business. These people include:
Board of directors
Consultants
Accountants
Attorneys
Bankers
Mentors
Operations & Location
The operations and location section of the plan illustrates how you are going to make or acquire your product and information about your business location.
Operations – Explain how and where your products or services are made. A few points to include in your plan
How does your car wash operate, what steps are in your service?
Who are your suppliers?
What are the terms and lead time for this product?
Location – Location is where you will be doing business out of. If you are in the classic, I can’t get my location until I get a loan so I can’t finish my business plan scenario, list what features you are looking at in a building along with average prices or rents and pad that number a little just in case. A few things to add:
Department of Transportation traffic count – most states have this information online to show how many vehicles pass your location each day.
Building description
What is the size
Where is it located
Specific reasons for this property
Proximity to suppliers, roads, airports, railroads, and shipping centers, etc.
Zoning
Average utilities – Be sure to get the last 12 months from the electric company if the building had been occupied. This could be an expensive lesson from a dishonest landlord. If you are opening a new location, try to talk with other car wash operators in a non-competitive area to get a estimate
Add pictures to the appendix
Add a floor plan to the appendix
Purchase price or monthly rent/lease
Include sales/rent/lease agreement in appendix
If building or renovating be sure to include quotes as this is an area frequently underestimated in costs.
Financial Projections
Financial projections are placed at the end of your business plan, before the appendix but it a very critical piece to the plan. The three must-have financial statements are a cash flow statement, a profit and loss statement and a balance sheet. The information already provided in the narrative portion of the business plan must match the financial projections. Most financial projections are three years in length. It is a good idea to include a Notes & Assumptions to Financial Projections page to both help make sure all of your numbers come through and provide an itemized list to provide clarity for the reader.
Notes & Assumptions to Financial Projections
Loans
Break out each loan (building, equipment, inventory)
Amount
Interest rate
Length
And any monthly costs not discussed in business plan narrative
Cost of goods/inventory
Advertising
Employee wages
Insurance
License & fees
Miscellaneous
Professional fees
Rent/property taxes
Repairs & maintenance
Supplies
Telephone
Utilities
Vehicle expense
Etc.
Anything else that needs to be explained in the financials that is not in the narrative
Financial Projection Sections
Startup Expenses – These are all expenses you will incur prior to opening your car wash. It is recommended to have quotes available or in the appendix for the larger items. It is also recommended that you pad your numbers some as there will always be unexpected expenses that were not accounted for.
Sources and Uses of Funds – This section details how the loan money will be used (inventory, car wash equipment, repairs and improvements, working capital, etc) and who is providing it (bank, investor or owner). You will likely need to be injecting 20% of your own money and maybe more depending on the risk assessment of the business and your personal finances.
Cash Flows – The cash-flow statement is one of the most important pieces of your business plan. It shows a schedule of the money coming into the business and expenses that need to be paid and whether you have enough cash to sustain the business gained during the warm month to cover the costs during the winter months. Every part of your business plan is important, but none of it means a thing if you run out of cash. Should this number be negative, you either need to raise sales, reduce expenses or have more cash. Your cash flow statement will typically be three years in length with the first year analyzing the monthly figures and later years by quarter. Don’t be intimidated with the cash flow statement as it is merely a future look into your checking account.
Profit & Loss – This statement, while similar to the cash flow statement but illustrated annually looks at the effects of non-cash charges such as depreciation and amortization to get an accounting overview of the operations of your business.
Balance Sheet – The balance sheet is a summary of the value of all assets, liabilities and equity for an organization at the end of each year. A balance sheet is often described as a “snapshot” of a company’s financial condition and will show the value of the business over time.
Personal Financial Statement – If you are looking at bank financing every person who will have a 20% or more ownership position will need to provide a personal financial statement to show how effective they are at managing your money. This statement will show your assets (checking & savings accounts, cd’s ira, 401K, valuables, home, vehicle, etc) as well as assets (mortgages, credit card bills, installment accounts, etc)
Appendices
Appendix items are various pieces of information that help make your case. Include details and studies used in your business plan; for example:
Quotes for items over $500
Resumes of the management team
Industry research
Demographic data and trends
Maps/floorplans/blueprints of location
Leases and contracts
Letters of support
There is a lot to creating your business plan but will definitely make your business stronger. While it may seem easier to have someone else write your plan, there is no substitute to writing it yourself. This is your business and by writing it yourself you will have a better understanding of your business and strategies for success. There are also many free business plan templates and workbooks available on the web to help you get started. You can use these to help get started creating your business plan and then modify it for your car wash business.
For more free articles and resources for starting a car wash are available at www.StartingACarWash.com.
Additionally, business plan help can be found at www.TheBusinessPlanFactory.com
Isis
Before embarking on writing a business plan for starting a car wash, a definition of what a business plan is in order. A business plan is a document to identify an opportunity, research why this opportunity is profitable and the steps needed to capitalize on the opportunity. The business plan can be a formal document or it can be written on the back of a napkin but the mere act of writing the idea down forces you to get the idea out of your head and on paper which helps find hidden business flaws and makes you think carefully about each phase of your business.
Creating a business plan is something anyone can do, even if you don’t know anything about business or finances. Even though the business plan is critical to getting the idea off of the ground, many entrepreneurs procrastinate when it comes to preparing a written plan. If you don’t know anything about business or finances, this is the best time to begin learning as the chances of your business being successful will be limited without this knowledge. Just as a builder won’t begin construction without a blueprint, entrepreneurs shouldn’t rush into new ventures without a plan. The old saying that “those who fail to plan, plan to fail” is very relevant when talking about starting a business. SBA’s statistics claim over half of new businesses fail in the first three years and the common factor is poor planning or under-capitalization (which is also poor planning).
Getting Started
The first step in creating a business plan is just getting started. Writing the business plan may seem overwhelming at first, but if you break the plan down to bite sized pieces and work on one section at a time won’t seem as daunting. Begin with what you know first and describe your business and your product or services. Work towards the more difficult subjects such as marketing, operations and financials. Don’t worry about it being perfect now, just get the concepts on paper – expand and refine later. If you get stuck on a section in the plan, skip it for now and come back later when you have more details.
Who is your audience?
When writing your car wash business plan, you need to keep in mind who your intended audience is and why you are writing the plan. Why? A plan for the bank will be less interested in the exit strategy and return on investment than one for equity investors. Additionally, a plan for written for internal use will be different than one looking for financing as a bank is not necessarily interested in detailed operations of the business.
Structure
Business plans tend to have a lot of elements in common. While there is not a format that all business plans follow, there are generally accepted guidelines that most follow as the order in which the subjects flow are not random. The Business Description of a business plan is aimed at painting a picture of your business and why this business will be successful. The Marketing, Management and Operations sections are researched and a strategy of how your business will compete and operate is developed. Last financial projections show in numbers what you explained in the business plan for the sales and expenses.
Breaking these three major sections down even further, a business plan consists of six key components:
Executive Summary
Business Description
Marketing
Managers & Employees
Operations & Location
Financial Projections
In addition to these sections, a business plan should also have a cover, title page and table of contents.
How Long Should Your Business Plan Be?
The answer that nobody liked in school applies to a business plan which is, “as long as it needs to be”. The more complex a business or the more sophisticated investors or funds requested will increase the length of a plan. An average car wash business plan narrative should be 4-15 pages plus financials and appendix items.
Business Plan Outline
Executive Summary
The executive summary is the first part of the business plan but is the last to be written. It gives the reader a quick glance of what your business proposal is about and what you are asking for. This part is critical as most readers will scan this section before deciding whether to read further.
The executive summary should typically be about one-half of a page in length and include what you would cover in an elevator pitch such as:
Explain the condensed version of the business concept
Product description or service proposition
This section should emphasize any unique features or benefits that what is currently in the industry or area, aka why would someone buy your product over the competition.
The demographics of your market
The Management team
When the anticipated start date is
Your equity position
How much are you asking for
Concise is the key in the executive summary. You will go into more detail later in the business plan.
Business Description
The purpose of the business description is to objectively describe the car wash business details and future potential include:
Mission
What the business does
Description of products and/or services
Industry information
Business Organization
Status of the business (start-up, expansion or purchasing)
Current and future goals
Any facts or figures should be noted and sources included in the business plan. This information is important should you need to defend your data and assumptions. The business description is where you are trying to paint a picture of the potential of your business along with the facts to support it. Try to inject energy and excitement to get the reader enthusiastic about the idea, without going overboard of course.
After describing the business, it is time to describe and additional products or services your car wash is selling. Keep in mind that it is important to show how your products and services are better than the competition. If you don’t have a good answer than you should rethink your strategy. What is it about your car wash that is going to get the customer to change doing business with the competition?
Marketing
A very important part of your business plan is the marketing section. Regardless of the quality of your products and your services, your business will be lost in the clutter of advertising. If you don’t know your customers, how will they ever find you? All of this begins with doing some research.
Customers: Who Is Your Market
The first step is to determine who you are going to sell to by identifying common characteristics of your market such as age, income, race, religion, education, interests and/or geographic locations. While everyone will want to wash their car product how are you going to effectively advertise to everyone and still make a profit? What you need to do instead is determine the group or groups of people who are most likely to use your car wash services and market to them. After all you are trying to generate a positive return on your marketing dollars, so use them wisely.
Competition
In today’s ultracompetitive marketplace, there is going to be competition, no matter how creative your business concept is. Attempting to run a portion of your car wash business better than the competition may be a difficult challenge so it is often better to focus on planning on being different and competing with them less directly. Can you serve a particular market niche such as the elderly that isn’t being looked at? Can you identify a unique operations/marketing/distribution strategy with a mobile approach? Even if you don’t have direct competition in your area meaning someone selling the same or similar products/services, you will have indirect competition for replacement products/services. If you indicate in your plan there is no competition it will be viewed that there is either no market for your product or you have not done your research.
Optimally you will want information on at least three but no more than five competitors. List information about who they are, how long they have been in business, location, products or services offered, perception on pricing, quality, etc. and compare your advantages and disadvantages. If the information you are looking for is not available online, you may need to pretend you are a customer to get some of this information.
Distribution – How Will You Get the Product To The Customer: By looking at who your market and competition is, you will have an idea of how to get your product to them. Perhaps through your research you will find a strategic advantage to serve the customer that the competition does not.
Promotional Strategy
With the above steps researched, the promotional strategy follows. The promotional strategy is where most entrepreneurs fail as they use the blanket statement that they are going to advertise in the newspaper, radio and/or television without thinking through the process or the customer. The promotional strategy provides you a map of how you are going to reach your market in the most efficient manner possible. Advertising is expensive, use it wisely.
Sales Projections
On of the more difficult areas of the business plan is coming up with sales projections. This number is probably going to be wrong and that’s ok. What you want is a figure backed up with justifiable data. Just grabbing a number out of the air saying you will make $300,000 won’t work. There are many sources to help come up with this number including:
Industry journals
Trade groups
Car washes in similar demographic areas
Industry experts
Census data
Pricing
The effects of pricing play a large role on how your product is perceived in the marketplace. Price too low compared to the competition and your product could be perceived as cheap and unreliable. Price too high with the features and benefits of your product and few customers come through the door. While this is a complex issue, here are a few things to keep in mind.
Make sure you can make a profit at whatever price you are selling at.
If you want to have lower costs and “get your foot in the door” it may be better to offer discounts or coupons initially until your business is better known.
Don’t be afraid to charge more for your product or service than the competition if you have something of more value to offer.
Pricing is the easiest of the marketing mix to change. You may find that a large competitor will under price you to ensure you can’t make a profit and your car wash goes out of business.
Management & Employees
In this section you would describe who is going to manage the business on a daily basis as well as provide strategic direction (if these positions are separate). Each of these people need to have a brief biography included as well as a resume in the appendix. Try to show how the experience and education of these people will be able to successfully execute the strategy in the business plan and succeed. Many times the owner may not have the specific experience for this business, so it is very important to pull their other professional experience in and explain how it will make for a successful operation. Next, a brief explanation of the employees is in order including:
What positions need to be filled
When they need to be filled (This is important in developing financial projections as you may have some employees come on after you start)
How much they get paid (Be sure to calculate payroll taxes as well, estimate 15% if not sure)
It is also recommended to add the professional and advisors to your business. These people include:
Board of directors
Consultants
Accountants
Attorneys
Bankers
Mentors
Operations & Location
The operations and location section of the plan illustrates how you are going to make or acquire your product and information about your business location.
Operations – Explain how and where your products or services are made. A few points to include in your plan
How does your car wash operate, what steps are in your service?
Who are your suppliers?
What are the terms and lead time for this product?
Location – Location is where you will be doing business out of. If you are in the classic, I can’t get my location until I get a loan so I can’t finish my business plan scenario, list what features you are looking at in a building along with average prices or rents and pad that number a little just in case. A few things to add:
Department of Transportation traffic count – most states have this information online to show how many vehicles pass your location each day.
Building description
What is the size
Where is it located
Specific reasons for this property
Proximity to suppliers, roads, airports, railroads, and shipping centers, etc.
Zoning
Average utilities – Be sure to get the last 12 months from the electric company if the building had been occupied. This could be an expensive lesson from a dishonest landlord. If you are opening a new location, try to talk with other car wash operators in a non-competitive area to get a estimate
Add pictures to the appendix
Add a floor plan to the appendix
Purchase price or monthly rent/lease
Include sales/rent/lease agreement in appendix
If building or renovating be sure to include quotes as this is an area frequently underestimated in costs.
Financial Projections
Financial projections are placed at the end of your business plan, before the appendix but it a very critical piece to the plan. The three must-have financial statements are a cash flow statement, a profit and loss statement and a balance sheet. The information already provided in the narrative portion of the business plan must match the financial projections. Most financial projections are three years in length. It is a good idea to include a Notes & Assumptions to Financial Projections page to both help make sure all of your numbers come through and provide an itemized list to provide clarity for the reader.
Notes & Assumptions to Financial Projections
Loans
Break out each loan (building, equipment, inventory)
Amount
Interest rate
Length
And any monthly costs not discussed in business plan narrative
Cost of goods/inventory
Advertising
Employee wages
Insurance
License & fees
Miscellaneous
Professional fees
Rent/property taxes
Repairs & maintenance
Supplies
Telephone
Utilities
Vehicle expense
Etc.
Anything else that needs to be explained in the financials that is not in the narrative
Financial Projection Sections
Startup Expenses – These are all expenses you will incur prior to opening your car wash. It is recommended to have quotes available or in the appendix for the larger items. It is also recommended that you pad your numbers some as there will always be unexpected expenses that were not accounted for.
Sources and Uses of Funds – This section details how the loan money will be used (inventory, car wash equipment, repairs and improvements, working capital, etc) and who is providing it (bank, investor or owner). You will likely need to be injecting 20% of your own money and maybe more depending on the risk assessment of the business and your personal finances.
Cash Flows – The cash-flow statement is one of the most important pieces of your business plan. It shows a schedule of the money coming into the business and expenses that need to be paid and whether you have enough cash to sustain the business gained during the warm month to cover the costs during the winter months. Every part of your business plan is important, but none of it means a thing if you run out of cash. Should this number be negative, you either need to raise sales, reduce expenses or have more cash. Your cash flow statement will typically be three years in length with the first year analyzing the monthly figures and later years by quarter. Don’t be intimidated with the cash flow statement as it is merely a future look into your checking account.
Profit & Loss – This statement, while similar to the cash flow statement but illustrated annually looks at the effects of non-cash charges such as depreciation and amortization to get an accounting overview of the operations of your business.
Balance Sheet – The balance sheet is a summary of the value of all assets, liabilities and equity for an organization at the end of each year. A balance sheet is often described as a “snapshot” of a company’s financial condition and will show the value of the business over time.
Personal Financial Statement – If you are looking at bank financing every person who will have a 20% or more ownership position will need to provide a personal financial statement to show how effective they are at managing your money. This statement will show your assets (checking & savings accounts, cd’s ira, 401K, valuables, home, vehicle, etc) as well as assets (mortgages, credit card bills, installment accounts, etc)
Appendices
Appendix items are various pieces of information that help make your case. Include details and studies used in your business plan; for example:
Quotes for items over $500
Resumes of the management team
Industry research
Demographic data and trends
Maps/floorplans/blueprints of location
Leases and contracts
Letters of support
There is a lot to creating your business plan but will definitely make your business stronger. While it may seem easier to have someone else write your plan, there is no substitute to writing it yourself. This is your business and by writing it yourself you will have a better understanding of your business and strategies for success. There are also many free business plan templates and workbooks available on the web to help you get started. You can use these to help get started creating your business plan and then modify it for your car wash business.
For more free articles and resources for starting a car wash are available at www.StartingACarWash.com.
Additionally, business plan help can be found at www.TheBusinessPlanFactory.com
Isis
Comments Off
Oct
09
Filed Under (Make Money) by
AC/DC asked:
Hi,
Hi,
I want to start a online business for advertising ads on it and some people said to me that the only legal procedure I need to take is to create a PayPal Business Account? If so, is it true? Where can I enroll that Business Account stuff and is it expensive?
Thanks for your help.
I live in Alberta, Canada, btw.
Omar
