AbstractChad and Kyle decided to buy a local auto detailing business, Precision Auto Detailing because they were not getting enough out of there current jobs. They started out with a invested $6,000 that got them started with the basics; tools, a building, a few established customers, and two employees that the previous owner had hired. Chad and Kyle started making calls and drumming up business. They maintained quality work and customer services, as well as having competitive prices, causing them to generate a good reputation. In eight months they had grown enough to need some new equipment, and were in need of a loan.(Toosi, 2009) In this paper a business loan is explained and outlined, and advice is given about the best ways to go about getting a loan.
IntroductionChad and Kyle decided to buy a local auto detailing business, Precision Auto Detailing. The new owners created a lot of new business and now they need a loan in order to get some new equipment.(Toosi,
2009) A business plan is a very important aspect of having a successful business, and getting financial support from banks or other investors.
Business PlanThe reason Chad and Kyle need a business plan is because bankers need assurances that there investment will make money, and that is made in a timely manner. A business plan is an explanation in writing of the effort that the company plans on using and the procedures that will be implemented for the business venture to be successful. A business plan is an explanation in black and white of the companies business model.
Outline of the ElementsI. Organizational planA. Profile of the Company1. Name, location, and business hours2.Services that are provided3. Number of Employees4. Annual sales figuresB. Our management team includes Chad Frank and Kyle Carson.
1. Background of key personnel including2. Strengths of management team3. Details regarding Management and their performanceII. Marketing planA. Name your objectives1. Explain how your going to achieve your goals2. Explain why achieving these objectives will make the company successfulB. Marketing Analysis1. Define the companies target market.
2. Explain industry and customer trends for your market3. Identify the competitionC. Marketing Strategy1. Give a general description of your market strategy2. Describe the method of sales ( store, pick up and drop off services, any off site work)3. Explain the competitive pricing4. Describe the sales strategies5. Public relations, loyal customer base6. Explain how the strategy is implemented, describe the individual responsibilitiesIII. Financial planningA. Financial need1. Why you need a loan2. The amount of money needed.
3. How the money will be spentB. Budget1. Pro forma cash flow statement.
a. Show cash flow in and out over a period of time, explaining the internal planning. Explains how the company plans to pay back the loan.(Pro forma cash flows, 2003)2. Income projection3. Projected Balance sheet to show the projection of assets, liabilities, and Net work at the end of the next fiscal year.(Business plan outline, 2007)4. Profit and Loss Statements5. Financial history of the companySupport of FundingThe bankers are going to look for specific things in the business plan. Investors are going to look at how the company is being managed. They will also look at the type of services and products that are going to be offered. They will need to know what kind of resources that will be needed, for example materials. The strengths and weaknesses of the company with be scrutinized. Long and short term plans and goals are going to make a huge impact of the banks decision. Make note of the loyal customers and competitive prices that help to keep the business successful.
AdviceHaving a business plan that will convincingly show that your company will sell enough of your services to ensure a adequate profit is key when trying to find a potential lenders. Remember that the most crucial thing that your business plan has to do is sell the lender that the business will be successful. When you present your business plan you need to be confident that your company will be a success. A business plan is intended to help identify possible problems and point out opportunities before it is too late to act on them. The financial section of the business is very important because the bank is most interested in having the loan repaid, and that it will be paid on schedule.
ConclusionIn order to get a loan approved the new owners of Precision Auto Detailing Chad and Kyle need to come up with a good business plan for the lenders to review. A business plan is important to the lenders because it shows them how the business is going to remain successful, and how the business will be able to pay back the loan in the scheduled time. With a good business pan Chad and Kyle can be confident that they will be able to sell there business to the lenders and in the end get the loan that they need to sustain the growth they have had in the business.
Reference ListBusiness plan outline. (2007). Retrieved August 07, 2009, from http://smartinvestcorp.net/IdealExecutiveSummary.aspxPro forma cash flows. (2003). Retrieved August 07, 2009, from http://www.businesstown.com/accounting/projections-cashflow.aspToosi, A. (2009). MGT260-0903A-01 Entrepreneurship: Unit 3 Individual Project: A business plan for precision auto detailing. Retrieved August 08, 2009, from https://mycampus.aiu-online.com/MainFrame.aspx?ContentFrame=/default.aspx