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Busines

s Plan
On

OnTrac Courier Service

By

Executive Summary
1. Introduction
OnTrac is a newly established small business in courier service. OnTrac is an emerging transport
operator that was established to fill a niche in the market of road freight industry in Wembly.
OnTrac can transport documents and small parcels to clients will provide local courier and
delivery services to customers in its targeted market. We can transport documents and parcels to
customers within a 40 mile radius of town. Our customers are medical professionals, attorneys
and local businesses who need reliable, same-day services not offered by the larger service
providers, such as Fedex and UPS.
1.1 Objectives
The objectives for the first three years of operation include:

Our primary goal is to surpass customer's expectations.

To enhance the number of clients served by 20% per year through superior service.

To expand a profitable start-up business within the first year of function.

1.2 Mission
Serve clients with an environmentally friendly, expedient delivery service. We subsist to attract
and preserve customers. Our services will surpass the expectations of our patrons.

Situation Analysis
OnTrac is entering their first year of operation. In order to achieve the market penetration that is
forecasted, marketing must become a dominant business activity. We offers the authorized
community a reliable, professional, delivery service that can provide service of notice, document
and small parcels delivery .The basic market need is a reliable service that can support all needs
the particular firm may have.

2.1 Company Ownership


The company will be owned completely by Rose.

2.2 Start-up Summary


OnTrac will acquire the following start-up costs:

Office furniture including: two desks, two chairs, and two file cabinets.

Three phone lines and Fax machine.

Two computer systems including a printer, CD-RW, and a broadband Internet connection.

Improvement of a website that permits delivery orders to be placed online and received

every ten minutes.


Legal fees for the assimilation of the business.

Messenger bags printed with company logo.

Services
The primary revenue center for the business will come from the local delivery of documents and
packages on behalf of individuals and businesses within the target market. The business will
generate substantially high gross margins from these services via its two delivery trucks.

Market Summary
The demand for reliable, cost-effective delivery services has been growing in the area for
several years as the towns population continues to grow. In addition to a growing
population, there are more customers who require faster service, ranging from stat
medical specimen deliveries to time-sensitive legal documents to just-in-time parts
deliveries to local manufacturers. There is only one other local courier service in the area,
and we believe there is ample room, due to our growing local economy, for another
reliable courier service.

We possess good information about the market and has excellent information about the
common characteristics of the most valued customers. This information will be used to
better understand who is served, their specific needs, and the best way to communicate
with them.

Marketing Objectives

Establish ongoing relationships with local businesses and corporations within the target
market.
Implement a local campaign with the Companys 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 Companys name
and contact information with online directories.

Market Needs
We are providing customers with a fast, reliable document delivery service throughout the
Wembly downtown area.
Marketing Strategy
The marketing strategy of OnTrac is to provide reliable and outstanding delivery services to
businesses and professionals who have a regular need for hoist and delivery services. This will
assure that we will have a regular, steady income from repeat customers. The second part of our
marketing strategy will be to gain customers who need courier services occasionally, such as
last-minute parts and supplies delivered to a contractors job site, plans deliveries for architects
and engineers and documents and materials for local government agencies.

SWOT Analysis
Strengths

Unparalleled legal industry imminent.

Professionalism and efficiency.

The use of fast, eco-friendly delivery vehicles.

Weaknesses

The require of brand.

The resist to convince different firms to drain their current service provider in favor of
OnTrac.

Opportunities

The repeated need for document delivery by medical firms.

The increasingly developed transportation for vehicles.

Threats

High turnover within the messenger industry.

Electronic filing.

Competition
Helping the Wembly area, there are about 10 different delivery services, about a quarter of these
are taxi services that also make deliveries. The rest are courier or messenger services. Some use
cars and a few use bicycles as the means of transportation. In general, the bicycle messengers
are less expensive because they have lower overhead. In the heart of downtown, bicycle
messengers can be as fast as or faster than the car-based courier services because of automobile
traffic.
There are five different companies that target law firms by catering to their special needs. All of
these are bicycle based services.

Keys to Success
The keys to success are:

Reliability.

Convenience.

Custom service.

Financial Summary

Sales Forecast
Year 1

Year 2

Year 3

152,459

255,458

271,554

20,841

30,254

35,125

173,300

285,712

306,679

Direct Cost of Sales

Year 1

Year 2

Year 3

Law firms

3,049

5,109

5,431

417

605

703

3,466

5,714

6,134

Sales
Law firms
Assorted customers
Total Sales

Assorted customers
Subtotal Direct Cost of Sales

Break-even Analysis

Monthly Revenue Break-even

19,155

Assumptions:
Average Percent Variable Cost

2%

Estimated Monthly Fixed Cost

18,772

Pro Forma Profit and Loss


Year 1

Year 2

Year 3

173,300

285,712

306,679

3,466

5,714

6,134

3,466

5,714

6,134

169,834

279,998

300,545

98.00%

98.00%

98.00%

177,360

183,360

189,360

Sales and Marketing and Other Expenses

3,000

3,000

3,000

Depreciation

1,500

1,500

1,500

Cellular service

4,200

4,200

4,200

Utilities

1,200

1,200

1,200

Insurance

1,800

1,800

1,800

Rent

9,600

9,000

9,000

26,604

27,504

28,404

225,264

231,564

238,464

Sales
Direct Cost of Sales
Other
Total Cost of Sales

Gross Margin
Gross Margin %

Expenses
Payroll

Payroll Taxes
Other

Total Operating Expenses

Profit Before Interest and Taxes

(55,430)

48,434

62,081

EBITDA

(53,930)

49,934

63,581

4,517

3,596

2,546

11,210

15,132

(59,947)

33,629

44,404

-34.59%

11.77%

14.48%

Interest Expense
Taxes Incurred

Net Profit
Net Profit/Sales

Pro Forma Cash Flow


Year 1

Year 2

Year 3

Cash Sales

43,325

71,428

76,670

Cash from Receivables

96,883

192,819

226,006

140,208

264,247

302,675

Sales Tax, VAT, HST/GST Received

New Current Borrowing

New Other Liabilities (interest-free)

Cash Received

Cash from Operations

Subtotal Cash from Operations

Additional Cash Received

New Long-term Liabilities

Sales of Other Current Assets

Sales of Long-term Assets

New Investment Received

140,208

264,247

302,675

Year 1

Year 2

Year 3

Cash Spending

177,360

183,360

189,360

Bill Payments

49,882

66,203

71,071

227,242

249,563

260,431

Sales Tax, VAT, HST/GST Paid Out

Principal Repayment of Current Borrowing

Other Liabilities Principal Repayment

9,055

9,976

11,026

Purchase Other Current Assets

Purchase Long-term Assets

Dividends

Subtotal Cash Spent

236,297

259,539

271,457

Net Cash Flow

(96,089)

4,707

31,218

5,111

9,818

41,036

Subtotal Cash Received

Expenditures

Expenditures from Operations

Subtotal Spent on Operations

Additional Cash Spent

Long-term Liabilities Principal Repayment

Cash Balance

Pro Forma Balance Sheet


Year 1

Year 2

Year 3

5,111

9,818

41,036

Accounts Receivable

33,092

54,557

58,561

Other Current Assets

Total Current Assets

38,203

64,375

99,597

7,500

7,500

7,500

Assets

Current Assets
Cash

Long-term Assets
Long-term Assets

Accumulated Depreciation

1,500

3,000

4,500

Total Long-term Assets

6,000

4,500

3,000

44,203

68,875

102,597

Year 1

Year 2

Year 3

4,505

5,525

5,870

Current Borrowing

Other Current Liabilities

4,505

5,525

5,870

Long-term Liabilities

40,945

30,969

19,942

Total Liabilities

45,450

36,494

25,812

Paid-in Capital

60,000

60,000

60,000

Retained Earnings

(1,300) (61,247)

(27,618)

Total Assets

Liabilities and Capital

Current Liabilities
Accounts Payable

Subtotal Current Liabilities

Earnings

(59,947)

33,629

44,404

Total Capital

(1,247)

32,382

76,785

Total Liabilities and Capital

44,203

68,875

102,597

Net Worth

(1,247)

32,382

76,785

Ratio Analysis
Year 1

Year 2

0.00%

64.87%

7.34%

4.50%

Accounts Receivable

74.86%

79.21%

57.08%

27.40%

Other Current Assets

0.00%

0.00%

0.00%

21.80%

Total Current Assets

86.43%

93.47%

97.08%

50.30%

Long-term Assets

13.57%

6.53%

2.92%

49.70%

100.00%

100.00%

100.00%

100.00%

Current Liabilities

10.19%

8.02%

5.72%

29.80%

Long-term Liabilities

92.63%

44.96%

19.44%

27.90%

102.82%

52.99%

25.16%

57.70%

-2.82%

47.01%

74.84%

42.30%

100.00%

100.00%

100.00%

100.00%

98.00%

98.00%

98.00%

100.00%

132.59%

86.23%

83.44%

79.50%

0.69%

0.42%

0.39%

0.20%

-31.98%

16.95%

20.24%

1.30%

Current

8.48

11.65

16.97

1.64

Quick

8.48

11.65

16.97

1.43

102.82%

52.99%

25.16%

57.70%

4807.12%

138.47%

77.54%

2.50%

Sales Growth

Year 3 Industry Profile

Percent of Total Assets

Total Assets

Total Liabilities
Net Worth

Percent of Sales
Sales
Gross Margin
Selling, General & Administrative
Expenses
Advertising Expenses
Profit Before Interest and Taxes

Main Ratios

Total Debt to Total Assets


Pre-tax Return on Net Worth

Pre-tax Return on Assets

-135.62%

65.10%

58.03%

5.90%

Additional Ratios

Year 1

Year 2

Year 3

Net Profit Margin

-34.59%

11.77%

14.48%

n.a

Return on Equity

0.00%

103.85%

57.83%

n.a

3.93

3.93

3.93

n.a

56

75

90

n.a

12.07

12.17

12.17

n.a

27

27

29

n.a

3.92

4.15

2.99

n.a

Debt to Net Worth

0.00

1.13

0.34

n.a

Current Liab. to Liab.

0.10

0.15

0.23

n.a

33,698

58,850

93,728

n.a

-12.27

13.47

24.39

n.a

Assets to Sales

0.26

0.24

0.33

n.a

Current Debt/Total Assets

10%

8%

6%

n.a

Acid Test

1.13

1.78

6.99

n.a

Sales/Net Worth

0.00

8.82

3.99

n.a

Dividend Payout

0.00

0.00

0.00

n.a

Activity Ratios
Accounts Receivable Turnover
Collection Days
Accounts Payable Turnover
Payment Days
Total Asset Turnover

Debt Ratios

Liquidity Ratios
Net Working Capital
Interest Coverage

Additional Ratios

Contingency Planning
Difficulties and Risks
Problems unseating current service providers.
Unforeseen difficulty attracting quality, reliable employees.

Worst Case Risks May Include

Electronic filing becomes legislatively mandated for 100% of the court filings.
Having to liquidate equipment to cover liabilities.