1.0 Executive Summary
The purpose of this business plan is to raise $150,000 for the development of a waste management company while showcasing the expected financials and operations over the next three years. Waste Management, Inc. (“the Company”) is a New York based corporation that will provide waste removal services to customers in its targeted market. The Company was founded by John Doe.
1.1 Operations
The Waste Management business been developed to provide an extremely comprehensive refuse removal and management service. The business will generate highly recurring streams of revenue from both businesses and residences that use the Waste Management business for their refuse removal needs. At this time, Management is sourcing the two trucks that it will lease in order to provide services to its customer base. The third section of the business plan will further describe the services offered by Waste Management, Inc.
1.2 The Financing
Mr. Doe is seeking to raise $150,000 from as a bank loan. The interest rate and loan agreement are to be further discussed during negotiation. This business plan assumes that the business will receive a 10 year loan with a 9% fixed interest rate. The financing will be used for the following: • Development of the Company’s office location. • Financing for the first six months of operation. • Capital to finance deposits for leasing of two waste hauling trucks. Mr. Doe will contribute $25,000 to the venture.
1.3 Mission Statement
The Waste Management’s mission is to become the recognized leader in its targeted market for refuse removal services.
1.4 Management Team
The Company was founded by John Doe. Mr. Doe has more than 10 years of experience in the waste management industry. Through his expertise, he will be able to bring the operations of the business to profitability within its first year of operations.
1.5 Sales Forecasts
Mr. Doe expects a strong rate of growth at the start of operations. Below are the expected financials over the next three years.
1.6 Expansion Plan
The Founder expects that the business will aggressively expand during the first three years of operation. Mr. Doe intends to implement marketing campaigns that will effectively target individuals and businesses within the target market.
2.0 Company and Financing Summary
2.1 Registered Name and Corporate Structure
Waste Management, Inc. The Company is registered as a corporation in the State of New York.
2.2 Required Funds
At this time, Waste Management, Inc. requires $150,000 of debt funds. Below is a breakdown of how these funds will be used:
2.3 Investor Equity
Mr. Doe is not seeking an investment from a third party at this time.
2.4 Management Equity
John Doe owns 100% of Waste Management, Inc.
2.5 Exit Strategy
If the business is very successful, Mr. Doe may seek to sell the business to a third party for a significant earnings multiple. Most likely, the Company will hire a qualified business broker to sell the business on behalf of Waste Management, Inc. Based on historical numbers, the business could fetch a sales premium of up to 6 times earnings. However, with recent fuel costs rising, the premiums for waste management businesses have declined due to the volatility of the oil markets. It should be noted that Mr. Doe intends to operate this business for a significant period of time, and a potential exit strategy would not be executed for at least five to seven years.
3.0 Operations
Below is a description of the services offered by Waste Management, Inc.
3.1 Waste Management Services
The primary revenue center for the business will come from ongoing hauling of dumpsters, providing waste management services, and hazardous materials disposal. The business will generate substantial fees from housing communities and home owners associations that contract Waste Management, Inc. for their ongoing waste management needs. The business will also generate significant secondary revenues from the ongoing hauling of large items such as couches, refrigerators, and other large items that require special handing and disposal needs.
4.0 Strategic and Market Analysis
4.1 Economic Outlook
This section of the analysis will detail the economic climate, the waste management industry, the customer profile, and the competition that the business will face as it progresses through its business operations.
Currently, the economic climate is moderate. The economy is undergoing a transition period due to changes in global trade policy. At this time, interest rates have remained steady due to appropriate and measured policies by central banks. While there has been volatility, this is expected to subside as the economy adapts to these changes.
However, any issues with the economy will not impact the Company’s ability to operate at a profit given the demand for comprehensive waste management services at all times.
4.2 Industry Analysis
Within the United States, there are approximately 8,000 businesses that provide waste management, private recycling, and removal for non-hazardous recyclable waste from construction sites. These companies aggregately generate more than $26 billion dollars per year and provide jobs for more than 160,000 people. The industry is a mature, and the expected future growth rate is anticipated to equal that of the general growth of the US economy.
4.3 Customer Profile
Management anticipates that the following individuals and entities will be customers of Waste Management, Inc.: • Individual Residences • Home Owners Associations • Housing Communities • Municipal Agencies • Commercial Enterprises
4.4 Competitive Analysis
This is one of the sections of the business plan that you must write completely on your own. The key to writing a strong competitive analysis is that you do your research on the local competition. Find out who your competitors are by searching online directories and searching in your local Yellow Pages. If there are a number of competitors in the same industry (meaning that it is not feasible to describe each one) then showcase the number of businesses that compete with you, and why your business will provide customers with service/products that are of better quality or less expensive than your competition.
5.0 Marketing Plan
Waste Management, Inc. intends to maintain an extensive marketing campaign that will ensure maximum visibility for the business in its targeted market. Below is an overview of the marketing strategies and objectives of Waste Management, Inc.
5.1 Marketing Objectives
- Implement a localized marketing campaign that targets individuals and homeowners associations.
- Establish relationships with municipal agencies within the targeted market.
- Develop an online presence by developing a website and placing the Company’s name and contact information with online directories.
5.2 Marketing Strategies
The Company intends to use a multitude of marketing strategies to promote and expand the waste management businesses operations. The Company will maintain its listing in the Yellow pages, create marketing campaigns within local newspapers, and promote the business through word of mouth advertising. The business actively advertises its affordable contracting services. Mr. Doe intends to maintain a website that allows customers to contact Management directly over email for more information regarding the Company’s waste management services and pricing quotes. As the Company expands, the business will upgrade the website to include higher levels of functionality and support. Additionally, Management intends to continually develop a number of referral and contractual relationships within among municipal agencies, commercial enterprises, and housing communities. Since these businesses regularly require waste management services, Management sees a significant opportunity to partner with these firms.
6.0 Organizational Plan and Personnel Summary
6.1 Corporate Organization
6.2 Organizational Budget
7.0 Financial Plan
7.1 Underlying Assumptions
- Waste Management, Inc. will have an annual revenue growth rate of 16% per year.
- The Owner will acquire $150,000 of debt funds to develop the business.
- The loan will have a 10 year term with a 9% interest rate.
7.2 Sensitivity Analysis
The Company’s revenues are sensitive to many external factors. Should the cost of oil increase significantly, Management fully expects that its bottom line income will decrease. However, the Company has priced its services so that increases in the price of oil will not severely impact the Company’s ability to operate both profitably and cash flow positive. In the event of a dramatic increase in price, Management will seek to increase the price of its waste management services to reflect the higher transportation costs.
7.3 Source of Funds
7.4 General Assumptions
7.5 Profit and Loss Statement
7.6 Cash Flow Analysis
7.7 Balance Sheet
7.8 Breakeven Analysis
7.9 Business Ratios
