1.0 Executive Summary
The purpose of this business plan is to raise $100,000 for the development of a sign making service while showcasing the expected financials and operations over the next three years. Sign Maker, Inc. (“the Company”) is a New York based corporation that will provide an expansive array of sign products to customers in its targeted market. The Company was founded by John Doe.
1.1 Operations
Sign Maker, Inc. will provide an expansive array of graphic design services, custom sign development printing, and outsourced lighted sign production. The Company will generate service revenue from graphic design services and sales revenue from product sales. The Company will develop a retail facility that will house all equipment necessary to provide the graphic design and sign production services on site. The third section of the business plan will further describe the services offered by the Sign Maker.
1.2 The Financing
Mr. Doe is seeking to raise $100,000 via a bank loan for the development of the business. The terms, interest rate, and loan covenants are to be determined at the time of negotiation. However, this business plan assumes that the Company will receive a 10 year loan with a 9% interest rate due on the outstanding principal balance. This loan financing will be used for the following: • Development of the Company’s Sign Maker location. • Financing for the first six months of operation. • Capital to purchase equipment related to providing sign production services and products. The second section of the business plan will further document the usage of funds.
1.3 Mission Statement
The Sign Maker’s mission is to develop an expansive facility that will provide graphic design, custom screen printing, and embroidery services to the general public of New York.
1.4 Management Team
Mr. Doe is an experienced business person that will be able to effectively manage the day to day operations of the Sign Maker. His biography can be found in the sixth section of the business plan.
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 within the target market.
2.0 Company and Financing Summary
2.1 Registered Name and Corporate Structure
Sign Maker, Inc. The Company is registered as a corporation in the State of New York.
2.2 Required Funds
At this time, the Sign Maker requires $100,000 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 Sign Maker, 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 Sign Maker. 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 graphic design and sign production services offered by the Sign Maker, Inc.
3.1 Graphic Design Services
The Sign Maker will provide graphic design services to customers that are in need of logos or designs in regards to their signage. These designs can be purchased as a stand alone service or for sign production (which is the Company’s main revenue stream).
3.2 Sign Production
The primary stream of income will be from the sale of sign products and to customers. The Company anticipates that it will generate margins of 50% on each dollar of sales. The business will have the ability to outsource the production of neon lit signs on behalf of its customers.
4.0 Strategic and Market Analysis
4.1 Economic Outlook
This section of the analysis will detail the economic climate, the sign making 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, sign production services tend to operate with great economic stability as people will continue to purchase these promotional signs for their stores and businesses.
4.2 Industry Analysis
There are over 38,000 businesses that sell sign production services, graphic design services, and related services. Among these businesses, the industry generates more than $14 billion dollars per year, and provides jobs for more than 208,000 people. Each year, average annual payrolls reach $2 billion dollars. The growth rate of these businesses has been in step with that of the general growth of the economy. This trend is expected to continue.
4.3 Customer Profile
The Sign Maker’s average client will be a small business operating within the Company’s target market. Common traits among clients will include:
• Annual revenues exceeding $150,000 per year.
• Operates no more than 15 miles from the Company’s location.
• Will spend $150 to $1,000 with the Sign Maker.
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
Sign Maker 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 Company.
5.1 Marketing Objectives
- Establish relationships with 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 advertising.
- 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 Sign Maker to easily target men and women 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 Company will also use an internet based strategy. This is very important as many people seeking local services, such as graphic designers and sign production services, now use the Internet to conduct their preliminary searches. Mr. Doe will register the Sign Maker with online portals so that potential customers can easily reach the sign production and graphic design 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 graphic design and sign products that the Company is selling.
6.0 Organizational Plan and Personnel Summary
6.1 Corporate Organization
6.2 Organizational Budget
7.0 Financial Plan
7.1 Underlying Assumptions
- Sign Maker will have an annual revenue growth rate of 16% per year.
- The Owner will acquire $100,000 of debt to develop the business.
- Management will settle most short term payables on a monthly basis.
7.2 Sensitivity Analysis
In the event of an economic downturn, the business may have a decline in its revenues. However, graphic design and sign production services are demanded by businesses and individuals. 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
