Marine Smith Electronics and Boat Repair - Case Study Example

BUSINESS PLAN MARINE SMITH ELECTRONICS AND BOAT REPAIR 1439 Portofino Drive Vista, CA 92081 760-458-4816 760-536-9584 mrslauriesmith@gmail.com TABLE OF CONTENT TABLE OF CONTENT 2 EXECUTIVE SUMMARY Marine Smith electronics and boat repair is a new organization that offers a complete range of electronics and repair services to the Orange country. It has planned to grow in business with outstanding sales in the next 3 years. Orange country having a number of beaches and a vast coastline is a prosperous market for the company. The company will be owned by Mr. Slaurie Smith. This would be a limited liability corporation as depending on nature of the business. We have good range of products and our employees are honest, trained, dedicated and willing to deliver on time to the customer. Customer loyalty and commitment is important for us. Marine Smith has a lot of competition however it is ready to compete ahead and differentiate itself by offering hassle free but a full stocked repair. The customers will be provided with guaranteed boat repair in least possible time. We will have a customer oriented focus on the business; our employees are trained and are held responsible for providing superior services, developing a long lasting trust bond with the customer. This is important because in electronic and boat repair business trust and honest counts more then image of repair facilities. We will focus on both upper and lower class but few of our item prices will be more as depending upon its standard and quality. Marine Smith electronics and boat repair will stand against the barriers and remove them as time passes and the company grows, we expect the business to prosper in the next 3 years. GENERAL COMPANY DESCRIPTION MarineSmith Electronics and Boat Repair will provide electronics and boat repair services to all of Orange County. MISSION STATEMENT To be the leader in Marine Electronics and Boat Repair by providing, honest, reliable, and timely workmanship with the best available products and prices in all the markets we serve. GOALS, OBJECTIVES AND PHILOSOPHY Our goal is to successfully penetrate the Orange County market and secure a loyal customer base that recognizes MarineSmith as the leader in Electronics and Boat Repair. Our objective is to have at least 95% customer satisfaction in the areas of honesty, reliability, and quality workmanship. Business philosophy is that for the first time we will provide quality workmanship. PRODUCT MARKET AND INDUSTRY Based on our plan we have decided to increase our net profits likewise. The total registered boats in Orange country are 4684 and there usage is divided as in chart Most of the boats are used in recreational activities and so our main focus will be on this area. Our services would be marketed towards boat owners, and being famous for tourism with around 45 million international and domestic tourist (Anaheim Orange country), it has a bright market and loyal customers in the country. COMPANY SUMMARY Marine smith electronics and boat repair is a new company and is a limited liability corporation. The economic growth of the last several years has resulted in increased disposable income. Many people have chosen to spend part of their increased income on their recreational activities. As a result, the need for reliable and convenient repair services has substantially risen as well. Marine Smith will position itself to capitalize on the growing need of the middle and upper class market for quality services in the Orange country. The company will be owned by Mr. Slaurie Smith. The initial startup cost would be as follows, Expenses Assts Investments loans Start up $ 0 600000 300000 400000 COMPETITIVE COMPARISON The SWOT for Marine Smith electronics and boat repair is as follows, STRENGTHS Our strengths include right products, quality and reliability, superior product performance vs. competitors, better product life and durability, spare manufacturing capacity, some staff have experience of end-user sector, have customer lists, direct delivery capability, product innovations ongoing, can serve from existing sites, products have required accreditations, processes and IT should cope and management is committed and confident. WEAKNESSES Our weaknesses include some gaps in range for certain sectors, we would be a small player, no direct marketing experience, need more sales people, limited budget, no pilot or trial done yet, customer service staff need training, Processes and systems, etc and management cover insufficient. OPPORTUNITIES Opportunities are we can develop new products, local competitors have poor products, profit margins will be good, and end-users respond to new ideas, could extend to overseas, new specialist applications, can surprise competitors, support core business economies and could seek better supplier deals. THREATS Environmental effects would favor larger competitors, existing core business distribution risk, possible negative publicity and vulnerable to reactive attack by major competitors. PRODUCT AND SERVICES Marine Smith electronics and boat repair has core competencies amongst its crew to work on all electronic and boat repairs. With all the employees focused on superior customer services quick turnaround will always be our standard. It strives to be honest and accurate with customers in terms of quoting cost estimates and repair completion time estimates. Our employees focus to deliver what they promise. We build strong customer relationships based on trust, integrity which will surely be the catalyst in establishing strong regular customer base. Marine Smith uses highest degree of technology in managing the electronic boat repair parts inventory. The goal is to never be out of specific parts while maximizing inventory turnover. Strong vendor relationships have been established with most reputable vendors in terms of shipping time of major parts. MARKETING PLAN ECONOMICS As based on statistics; the population of Orange country is 3,010,759, with 1,538,300 employed residents out of which 651,800 people are in service business. The GDP estimated is 184.8 billion. There are several beaches in the country with 40 miles of coastline. Tourism is a vital aspect of economy with the Disneyland resort being the second most visited theme park in the country, resorts within the beach cities receives more visitors throughout the year due to their close proximity with the beach and other related activities. Due to the vast coastline, tourism and the number of beaches, the need for electronic and boat repair is on increase in this country. TARGET MARKET AND POTENTIAL GROWTH There is a growing target market and many opportunities for the business to prosper. Although a few barriers exist including high capital cost, high marketing cost, consumer acceptance and brand recognition, training and skills and use of new technology, unions and tariff barriers and quotas. These barriers will take time and cost to be removed, but as the business will prosper and profits will start to increase more money will be spent first on removing these barriers. PRODUCT AND SERVICES Marine Smith is in the business of electronic and boat repair. We have dedicated employees always working their best to give maximum output. We use the latest technology and the best available repair parts. Our products and services are all guaranteed and are available in best optimal prices. Our product are for both lower and upper class people, but to maintain quality and give the best product few of our product prices are high as they are of best available quality with optimum standards. This electronic and service repair at present is available only for the orange country people. COMPETITORS Our three major competitors would be Dana Point shipyard, Boatswains Locker and Dana Marine centre. STRATEGY AND IMPLEMENTATION Marine Smith will succeed by offering its customers high-quality, rapid and convenient repair service. Additionally, it will succeed by ensuring a full range of repair parts inventory and rapid shipping capability of major parts. SALES STRATEGY Marine Smith will focus its sales strategy on effectively reaching the target customer segment of upper and middle class customers. For this purposes, the company will employ direct sales staff. It plans to achieve sales is as follows, FINANCIAL PLAN BREAK EVEN ANALYSIS . MONTHLY PRO FORMA FOR 1 YEAR Sales $9,540,000 Direct Cost of Sales $3,930,000 Other $0 Total Cost of Sales $3,930,000 Gross Margin $5,610,000 Gross Margin % 58.81% Expenses Payroll $4,315,000 Sales and Marketing and Other Expenses $27,000 Depreciation $120,000 Utilities $1,200 Payroll Taxes $647,250 Other $0 Total Operating Expenses $5,110,450 Profit Before Interest and Taxes $499,550 EBITDA $619,550 Interest Expense $26,748 Taxes Incurred $120,157 Net profit $352,645 PRO FORMA BALANCE SHEET Assets Current Assets Cash $34,532 Inventory $360,250 Other Current Assets $50,000 Total Current Assets $444,782 Long-term Assets Long-term Assets $890,000 Accumulated Depreciation $120,000 Total Long-term Assets $770,000 Total Assets $1,214,782 Liabilities and capital Current Liabilities Accounts Payable $382,473 Current Borrowing $0 Other Current Liabilities $0 Subtotal Current Liabilities $382,473 Long-term Liabilities $234,665 Total Liabilities $617,138 Paid-in Capital $250,000 Retained Earnings ($5,000) Earnings $352,645 Total Capital $597,645 Total Liabilities and Capital $1,214,782 Net Worth $597,645 Having a look at such a country which has lots of opportunities for the electronics and boat repair business; and studying the need for increase in boats for entertainment purpose yearly such an optimistic sales/ revenues can be projected APPENDIX SALES FORECAST Jan-Apr May-Aug Sep-Dec Unit Sales electronics 0% 1,400 1,400 1,400 boat repair 0% 6,250 6,250 6,250 Other 0% 0 0 0 Total Unit Sales 7,650 7,650 7,650 PERSONAL PLAN Jan-Apr May-Aug Sep-Dec Owners 0% $26,667 $26,667 $26,667 Managers 0% $11,250 $11,250 $11,250 Mechanics 0% $262,500 $262,500 $262,500 Customer Service Associates 0% $22,500 $22,500 $22,500 Sales & Administrative 0% $36,667 $36,667 $36,667 Total People 120 120 120 Total Payroll $359,583 $359,583 $359,583 GENERAL ASSUMPTIONS Plan Month Jan-Apr May-Aug Sep-Dec Current Interest Rate 10.00% 10.00% 10.00% Long-term Interest Rate 10.00% 10.00% 10.00% Tax Rate 30.00% 25.00% 25.00% Other 0 0 0 SOURCE CITED Orange country. Net, Orange County California Premier Listings - Featuring Area Businesses and Services, http://www.orangecounty.net/html/statistics.html Boat info world .com, Orange country CA: Boat, Yacht, & Ship Owners. http://www.boatinfoworld.com/boat/registrations/orange-county-ca-california.asp Read More