Fire pit auto performance
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The document is a confidentiality agreement for a business plan of Fire Pit Auto Performance. It states that the reader agrees not to disclose any confidential information from the business plan without written permission. It also acknowledges that the information is confidential in nature and any disclosure could harm Fire Pit Auto Performance. Upon request, the reader must return the document to Nicholas Fire.
Fire pit auto performance
- 2. Confidentiality Agreement The undersigned reader acknowledges that the information provided by Fire Pit Auto Performance in this business plan is confidential; therefore, reader agrees not to disclose it without the express written permission of Fire Pit Auto Performance. It is acknowledged by reader that information to be furnished in this business plan is in all respects confidential in nature, other than information which is in the public domain through other means and that any disclosure or use of same by reader, may cause serious harm or damage to Fire Pit Auto Performance. Upon request, this document is to be immediately returned to Nicholas Fire. ___________________ Signature ___________________ Name (typed or printed) ___________________ Date This is a business plan. It does not imply an offering of securities.
- 3. Table of Contents 1.0 Executive Summary ........................................................................................................ 1 1.1 Company Summary ..................................................................................................... 2 2.0 Products ............................................................................................................................... 2 3.0 Market Analysis Summary ............................................................................................ 2 4.0 Strategy and Implementation Summary ................................................................ 3 4.1 Marketing Strategy ...................................................................................................... 3 4.2 Sales Strategy ............................................................................................................... 4 4.3Milestones ......................................................................................................................... 4 Table: Milestones ............................................................................................................. 4 5.0 Management Summary .................................................................................................. 5 6.0 Financial Plan ..................................................................................................................... 6 Table: Financials ................................................................................................................... 6 6.1 Projected Cash Flow .................................................................................................... 9 Page 1
- 4. Fire Pit Auto Performance 1.0 Executive Summary Fire Pit Auto Performance is a small retail organization that will provide quality performance auto parts to any auto enthusiast. We will remain small in order to offer unprecedented customer attention. The Market The classic car industry continues to grow, with more than 6 million classic car collectors and 25 million classic car enthusiasts in the United States. The Outer Banks of North Carolina is home to many car clubs, hobbyist, and vintage auto owners with ongoing needs for specialty and performance parts for repairs, restoration and/or upgrades. Also, there is the racing side of our community, with drag racers and those of dirt track and off road. Then, we have our vacationers and those who travel here strictly for the car shows and bike weeks. The Organization Fire Pit Auto Performance is founded on the idea that maintaining satisfied customers with quality product is essential to the financial health of the organization. With this in mind, we will be working hard to ensure that all of their customer's expectations are exceeded in all transactions. To maintain a presence within the auto community and close relationships to customers, Fire Pit Auto Performance will be an active participant with the local car clubs, racing events, and community events through participation and sponsorship. Products, Services, and Delivery Fire Pit Auto Performance will be both a brick and mortar company serving the Outer Banks of North Carolina as well as offering online sales and shopping at our website. We will offer engine and chassis and body parts for a wide variety of cars as well as a variety of accessories, apparel and souvenirs. Safety equipment and set up equipment will also be offered. All of the popular name brands will be offered. Fire Pit Auto Performance is an exciting opportunity that combines a customer-centric organization with an energetic passion for the art and mechanics of these cars. Even for those who are not true enthusiast, it is now "cool" to have your car "tweaked out" even just for aesthetics, and an Outer Banks vacationer always wants to take home a cool t-shirt. Page 1
- 5. Fire Pit Auto Performance 1.1 Company Summary Fire Pit Auto Performance is a start up auto performance store. Upon start up of operations we will provide affordable new and used quality products with stand up customer service. As it stands, it will be the only auto store of its kind on the Outer Banks of North Carolina. 2.0 Products Fire Pit Auto Performance will sell performance auto parts to all auto enthusiasts, but will be mostly catering to Classic, Muscle and Race cars/trucks. Products will range from engine, chassis and body parts to accessories, apparel and souvenirs. Products will include new parts from quality named distributers to used parts we will purchase from anyone with a quality used part. Anyone with a reasonable used part can bring it in to receive cash (price to be determined by condition and demand of product) or store credit. Future plans include adding installation and repair services. We will rely on our customer's feedback and suggestions to introduce or eliminate products. 3.0 Market Analysis Summary Fire Pit Auto Performance will focus on the following markets: The Local Car Enthusiast - The Outer Banks of North Carolina is home to many car clubs, hobbyist, and vintage auto owners with ongoing needs for specialty and performance parts for repairs, restoration and/or upgrades. The Tourist - Dare County, North Carolina alone was visited by approximately 354,464,649 vacationers in 2010 with the peak months of May through October with as many passing through Page 2
- 6. Fire Pit Auto Performance and shopping from the Currituck side of the Outer Banks. We will offer store apparel, stickers and souvenirs and the Tourist can continue to be patrons via ecommerce. The Local Racer - Eastern North Carolina has several drag, stock car, modified, and off-road race tracks. The Internet Shopper - Our web-based store will allow purchases and inquiries to be made from any locale within the United States. - Bike Week, Bike Fest and Bike Rally, Shamrock Car Show, Outer Hosted Events Banks Car Show and many others. 4.0 Strategy and Implementation Summary Our strategy is based on serving the classic auto enthusiast, racer or performance junkie. Our area is full of owners that can't get specialty products or services locally. The Outer Banks does not yet have a store of this kind. Auto Enthusiast here have only your everyday Advance Auto (1), Napa (3), and Carquest (1). As many classic, muscle and race car enthusiast as the Outer banks has living here and visiting here especially, it's a fail proof market if it's done and done right. 4.1 Marketing Strategy The marketing strategy for Fire Pit Auto Performance is constructed to cover (2)two markets, local enthusiast being one and tourists being the other. Below is a breakdown of our marketing strategies: Grand Opening - A Grand Opening is one of the most successful of in-store promotions. With manufacturer support, a large number of door prizes can be given away while instantly building a mailing list and generating customer interest. Events - We will be attending as many events as possible, and we also plan to coordinate an event or events of our own. Some events may generate profits for the business and some are strictly for charity, but all events will be great advertisement and help us to become an asset to our community. Advertisement - We plan on running limited space ads in the local newspapers and on the local radio stations to keep our name, location and phone number in front of the consumer. We would like to figure advertising in seasonal brochures, rental agencies, and aerial ads over the beach in year 2 or year 3 of operation. Sponsorship - There are many sponsorship opportunities on the Outer Banks that are beneficial to the community as well as good advertisement. Some examples of these would be the sponsorship of school organizations and teams, recreational leagues, local charity organizations and many other community events. Promotional Products - A line of premium Fire Pit Auto Performance apparel will be designed and produced in very short runs to reduce inventory costs. These can be sold or given away Page 3
- 7. Fire Pit Auto Performance with qualifying purchases to further expose the Fire Pit Auto Performance name. We will have decals manufactured with various Fire Pit Auto Performance logos. We will include the decals with all of the orders that we ship. Website- We have established our e-commerce business at www.fpautoperf.com and are listed on Face book at www.facebook.com/pages/Fire-Pit-Auto-Performance/137508522975923. This channel of business will increase the customer base, sales potential and service opportunities. 4.2 Sales Strategy Our extensive product knowledge and the increasing knowledge of our customers and their vehicles are two of the most important tools used to build sales. We will offer the best possible return/exchange policy to build trust with our customers and maintain retention and loyalty; return/exchange policies vary based on nature of the parts. We also offer our used parts purchasing program as an option to help customers afford higher priced products by applying the cash value of their used part towards the purchase price of the new part. 4.3Milestones The milestones table and chart show the specific detail about actual program activities that should be taking place during the year. Each one has its manager, starting date, ending date, and budget. During the year we will be keeping track of implementation against plan, with reports on the timely completion of these activities as planned. Table: Milestones Milestones Milestone Start Date End Date Budget Manager Department Finish Business Plan 2/1/2011 2/28/2011 $0 Nick Owner Corporate Set Up 2/15/2011 2/28/2011 $125 Nick Owner Business Bank Account 2/15/2011 2/28/2011 $100 Nick Owner Internet Store 2/1/2011 2/28/2011 $60 Nick Admin Promotional Items 3/1/2011 3/31/2011 $200 Nick Marketing Marketing Program Starts 3/15/2011 3/31/2011 $100 Nick Marketing Leasing Commercial Property 3/1/2011 4/30/2011 TBD Nick Owner Grand Opening 4/1/2011 5/31/2011 TBD Nick Marketing Radio/Print Ads 4/1/2011 5/31/2011 TBD Nick Marketing Plan Review/Comparison 6/1/2011 7/1/2011 $0 Nick Admin First Break Even Month 8/1/2011 9/30/2011 $0 Nick Admin Totals $585 Page 4
- 8. Fire Pit Auto Performance 5.0 Management Summary We are a small company owned and operated by Nicholas and Melanie Fire, husband and wife, under "Fire Pit Auto Performance" as a limited liability company. Nicholas Fire - Manager Nick will be the main salesperson. He will also be responsible for shipping and receiving, inventory management, and the marketing and promotion of in store products. Nick will also handle Internet sales and marketing. He will assist with record keeping, cost containment, and will be in charge of the computer system and perform all of the desktop publishing for the company. Melanie Fire - Manager Melanie will maintain the company records and be in direct communication with the accountant and other advisors. She will assist as needed with sales, shipping and receiving, and customer service related issues. The initial management team depends on the founders themselves, with little back-up. We plan on hiring additional personnel as the need for them arises, and as we have the ability to pay them. Page 5
- 9. Fire Pit Auto Performance 6.0 Financial Plan Inventory and rent are the two major expenses, while depreciation is another significant cost that will increase as the company develops. We want to finance growth mainly through cash flow. We recognize that this means we will have to grow slowly. It should be noted that the owners of Fire Pit Auto Performance do not intend to take any profits out of the business until any long-term debt that has been incurred is satisfied. Whatever profits remain after the debt payments will be used to finance growth, mainly through the acquisition of additional inventory. Table: Financials Financials Year 1 Year 2 Year 3 Beginning Balance Opening Balance Cash & Checking $500 $5,863 $12,237 Plus Money Received New Investment $2,143 $4,286 $8,400 New Loans $0 $0 $0 Sales $64,146 $84,156 $115,156 Other $0 $0 $0 Subtotal Money Received $66,289 $88,442 $123,556 Less Money Spent Direct Costs Direct Cost of Sales $45,118 $66,159 $96,156 Other Costs of Sales $0 $0 $0 Normal Operating Expenses Payroll and Payroll Taxes, Benefits, Etc. ($0) $0 $0 Rent and Utilities $12,000 $12,000 $12,000 Sales and Marketing Expenses $1,200 $1,300 $1,400 Other Operating Expenses $0 $0 $0 Other Outflows Payments of Taxes $2,609 $2,609 $2,609 Debt Payments $0 $0 $0 Purchase of Assets $0 $0 $0 Other $0 $0 $0 Subtotal Money Spent $60,926 $82,068 $112,165 Ending Balance Ending Balance Cash and Checking $5,863 $12,237 $23,628 Profit Before Interest and Taxes Sales $64,146 $84,156 $115,156 Less Cost of Sales ($45,118) ($66,159) ($96,156) Gross Margin $19,028 $17,997 $19,000 Less Operating Expenses ($13,200) ($13,300) ($13,400) Profit Before Interest and Taxes $5,829 $4,697 $5,600 Net Cash Flow $5,363 $6,374 $11,391 Page 6
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- 12. Fire Pit Auto Performance 6.1 Projected Cash Flow A three year projected Cash Flow is detailed in the table and chart following. Monthly projected Cash Flow for year 1 is available for review in the Appendix. Fire Pit Auto Performance plans to operate on a cash basis with vendors the first year, therefore, no Accounts Payable for the first year. As credit is established, we assume that in the second and third year 40% to 50% of monies owed to vendors will be reflected in Accounts Payable. Page 9
- 13. Appendix Table: Financials Financials Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Beginning Balance Opening Balance Cash & Checking $0 $500 $269 $124 $75 $131 $302 $600 $1,037 $1,627 $2,387 $3,334 $4,486 Plus Money Received New Investment $0 $100 $110 $121 $133 $146 $161 $177 $195 $215 $237 $261 $287 New Loans $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Sales $0 $3,000 $3,300 $3,630 $3,993 $4,392 $4,831 $5,314 $5,845 $6,430 $7,073 $7,780 $8,558 Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Subtotal Money Received $0 $3,100 $3,410 $3,751 $4,126 $4,538 $4,992 $5,491 $6,040 $6,645 $7,310 $8,041 $8,845 Less Money Spent Direct Costs Direct Cost of Sales $0 $2,110 $2,321 $2,553 $2,808 $3,089 $3,398 $3,738 $4,112 $4,523 $4,975 $5,472 $6,019 Other Costs of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Normal Operating Expenses Payroll and Payroll Taxes, Benefits, Etc. $0 ($0) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Rent and Utilities $0 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 Sales and Marketing Expenses $0 $100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $100 Other Operating Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Other Outflows Payments of Taxes $0 $122 $134 $147 $162 $178 $196 $216 $238 $262 $288 $317 $349 Debt Payments $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Purchase of Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Subtotal Money Spent $0 $3,331 $3,555 $3,800 $4,070 $4,367 $4,694 $5,054 $5,450 $5,885 $6,363 $6,889 $7,468 Ending Balance Ending Balance Cash and Checking $0 $269 $124 $75 $131 $302 $600 $1,037 $1,627 $2,387 $3,334 $4,486 $5,863 Profit Before Interest and Taxes Sales $3,000 $3,300 $3,630 $3,993 $4,392 $4,831 $5,314 $5,845 $6,430 $7,073 $7,780 $8,558 Less Cost of Sales ($2,110) ($2,321) ($2,553) ($2,808) ($3,089) ($3,398) ($3,738) ($4,112) ($4,523) ($4,975) ($5,472) ($6,019) Gross Margin $890 $979 $1,077 $1,185 $1,303 $1,433 $1,576 $1,733 $1,907 $2,098 $2,308 $2,539 Less Operating Expenses ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) Profit Before Interest and Taxes ($209) ($121) ($23) $85 $203 $333 $476 $633 $807 $998 $1,208 $1,439 Net Cash Flow ($231) ($145) ($49) $56 $171 $298 $437 $590 $760 $947 $1,152 $1,377 Page 1