1.0 Executive Summary
The purpose of this business plan is to raise $125,000 for the development of a video production business while showcasing the expected financials and operations over the next three years. The Video Production, Inc. (“the Company”) is a New York based corporation that will provide videography services to customers in its targeted market. The Company was founded by John Doe.
1.1 Operations
As stated above, the Company will be actively engaged in the business of providing private recording services for events, small businesses, and other groups that have videography needs. Management expects that the business’ market will primarily consist of individuals with event recording needs. The Video Production, Inc. will also provide reproduction services so that families can distribute branded DVDs of their taped events. The third section of the business plan will further describe the services offered by The Video Production, Inc.
1.2 The Financing
Mr. Doe is seeking to raise $125,000 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.
1.3 Mission Statement
The Video Production’s mission is to become the recognized leader in its targeted market for videography services.
1.4 Management Team
The Company was founded by John Doe. Mr. Doe has more than 10 years of experience in the videography 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 event planners within the target market.
2.0 Company and Financing Summary
2.1 Registered Name and Corporate Structure
The Video Production, Inc. The Company is registered as a corporation in the State of New York.
2.2 Required Funds
At this time, the Video Production requires $125,000 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 the Video Production, 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 the Video Production. Based on historical numbers, the business could fetch a sales premium of up to 4 times earnings.
3.0 Operations
Below is a description of the videography services offered by the Company.
3.1 Videography Services
The Company will provide private video production and recording services for individuals and businesses that are seeking to capture their occasions or small business commercials on video. This business is the backbone to the Company’s ongoing success as it provides a stable and predictable stream of income that can be used to pay for the business’s expenses. The business also provides production services for bands (music videos), infomercials, theater, and other business oriented video needs. Additionally, the business can act as an outsourced provider of video editing. The owners of the business provide these services to people and businesses within the targeted and its surrounding area. While the Company’s primary area will be in New York, the business will provide services at any location.
4.0 Strategic and Market Analysis
4.1 Economic Outlook
This section of the analysis will detail the economic climate, the videography 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, video production businesses operate with great economic stability as people will continue to host events and produce small commercials despite deleterious changes in the general economy.
4.2 Industry Analysis
Private video production is a smaller subset of the film production industry. These businesses are primary used for filming occasion events. In the United States there are approximately 4,000 businesses that specialize in filming occasion and special events. Each year, these businesses aggregately generate $1.7 billion dollars a year of receipts, and provide jobs for more than 20,000 people. The growth trend of this business has remained in lockstep with the growth of the general economy, and is expected to remain stable as long as the economy continues to grow at an annualized growth rate of two to three percent.
4.3 Customer Profile
In this section of the analysis, you should describe the type of customer you are seeking to acquire. These traits include income size, type of business/occupation; how far away from your business is to your customer, and what the customer is looking for. In this section, you can also put demographic information about your target market including population size, income demographics, level of education, etc.
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
The Company 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 the Video Production, Inc.
5.1 Marketing Objectives
- Establish relationships with event planners and small business advertising agencies within the targeted market.
- Implement a local campaign with the Company’s targeted market via the use of flyers, local newspaper advertisements, and word of mouth.
- Develop an online presence by developing a website and placing the Company’s name and contact information with online directories.
5.2 Marketing Strategies
Mr. Doe intends on using a number of marketing strategies that will allow the Video Production, Inc. to easily target men and women with event filming needs within the target market. These strategies include traditional print advertisements and ads placed on search engines on the Internet. Below is a description of how the business intends to market its services to the general public. The Video Production, Inc. will also use an internet based strategy. This is very important as many people seeking local services, such as videography, now the Internet to conduct their preliminary searches. Mr. Doe will register the business with online portals so that potential customers can easily reach the Video Production business. The Company will also develop its own online website. The Company will maintain a sizable amount of print and traditional advertising methods within local markets to promote the videography that the Company is selling. Mr. Doe will also partner with local event planners so that the business can generate new customers on a referral basis.
6.0 Organizational Plan and Personnel Summary
6.1 Corporate Organization
6.2 Organizational Budget
7.0 Financial Plan
7.1 Underlying Assumptions
- The Video Production, Inc. will have an annual revenue growth rate of 16% per year.
- The Owner will acquire $120,000 of debt funds to develop the business.
- The loan will have a 10 year term with a 9% interest rate.
7.2 Sensitivity Analysis
In the event of an economic downturn, the business may have a decline in its revenues. However, videography services are demanded by businesses and individuals due to the simple fact that despite deleterious economic conditions, people will continue to host events and produce new small business commercials. As such, only a severe economic downturn would result in a decline in revenues.
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
