Columbia Cleaners is going to provide the following services for customers with free home pick-up and delivery in the Hillsboro area:
Operations plan
There are two ways for customers to take part in the service. Customers can sign contracts with Columbia Cleaners to get regularly scheduled service, or, if it is more convenient, they can order over the telephone or via e-mail.
Customers can choose payment either at the time of each delivery, or by monthly credit card billing. We will send statements to each contract customer, itemizing service fees and the charge for the service to their credit cards for payment, at the end of each month.
No retail shop will be rented in order to reduce the operation cost. An operations facility for installing machines and equipment, washing and cleaning activities, and storing not yet cleaned and cleaned garments and items is needed. The operations facility will require about 2,000 square feet divided into four main sections as following:
The whole operation process will be controlled and monitored by a laundry expert employee, and generally managed by the business owner.
It is necessary to establish the reasons for choosing the dry cleaning, laundry, and alteration service before doing the market research and marketing plan. “Laundries and Dry Cleaners rated in the top ten enterprises with the lowest failure rate.” http://www.mindspring.com/~jimgirone/cleanpage/desire.html
We will be targeting both full-time and part-time employed customers who would value the convenience of our service. Demographic research shows that the total population of the Hillsboro-Beaverton area is about 350,000, of which about 250,000 are in the labor force. Of the later, approx. 220,000 are employed full time, 20,000 are employed part time and the rest are unemployed, as summarized in the table below.
Market Analysis | |||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |||
Potential Customers | Growth | CAGR | |||||
Full-time employees | 2% | 220,000 | 224,400 | 228,888 | 233,466 | 238,135 | 2.00% |
Part-time employees | 2% | 20,000 | 20,400 | 20,808 | 21,224 | 21,649 | 2.00% |
Other | 0% | 10,000 | 10,000 | 10,000 | 10,000 | 10,000 | 0.00% |
Total | 1.92% | 250,000 | 254,800 | 259,696 | 264,690 | 269,784 | 1.92% |
The table in the previous topic shows estimated percentages of Hillsboro-Beaverton residents working full time in 2004, which is a lot higher than that of those working part-time. Employment, income, and GDP trends show an increase over the past several years as well. This results in increasing standard of living, which in turn leaves people having less time to do their housework (including laundry) in Hillsboro. They are often tired after the whole day of working and tend to spend money to hire someone else to do the housework for them. Moreover, the demand on clothes of these working people (particularly professionals) usually increases proportionately with their income. Buying more clothes, especially expensive clothes, makes them pay more attention to the care and cleaning of those garments. With careful research, this business focuses on working and professional class customers as a target segment market.
Research shows that one of the key factors in choosing a personal service, such as laundry and dry cleaning, is not price but the convenience of the service. As stated above, with the growth of discretionary income people tend to choose services based on how much time and effort the service will save them. Although there are several conventional drop-off dry cleaning/laundry service providers in the area, Columbia Cleaners will primarily market its convenient pickup/delivery service to those busy individuals who are willing to appreciate such service, as it saves them time for other endeavors.
The personal service industry is very fragmented overall. The Metropolitan Portland area is no exception to that, with numerous small providers servicing the community’s needs for laundry and dry cleaning. In the city of Hillsboro there are about half-dozen dry cleaners, some of which also provide laundry and garment alteration services. However, almost none of them, except Convenient Door-to-Door Dry Cleaning, provide the convenience of the door-to-door service.
Competition in the dry cleaning/laundry business in the Hillsboro area is not fierce. Research shows that there are seven dry cleaners in the city of Hillsboro, almost all of them offering the traditional drop-off service. The only competitor offering the convenience of the door-to-door service is Convenient Door-to-Door Dry Cleaning that provides dry cleaning and shoe repair services. We believe that initially this will be our major local competitor. We also believe that we will be able to win customers from our regular, drop-off competitors by enhancing the clients’ peace of mind though a new level of convenience and saving their time.
The following areas will be monitored to evaluate the business performance:
The business success will depend on quality and convenience of the service, customer opinions, and competitor response.
The business provides a new door-to-door dry cleaning, laundry, and alteration service in Hillsboro that will surely attract customer attention. Working customers may find this service is convenient for them and want to try it. If they are satisfied with the service quality they will likely become repeat customers. When the patronage happens continuously, they become loyal customers of the service. These customers will recommend Columbia Cleaners to their friends and coworkers. As more and more customers use this service, Columbia Cleaners’ image is enhanced and we will gain more and more market share.
If we attain monthly and annual sales at least as forecasted, total costs and expenses, including any unanticipated charges, will not exceed our estimates and therefore the monthly and annual profit will be satisfactorily achieved.
Difficulties and Risks
Columbia Cleaners is a start-up and as such has less experience and begins with no market share at all. Assertive, effective initial marketing efforts will be necessary to gain a customer base. If existing competitors see us as a major threat and they resort to overtly aggressive and debilitating actions it will be very difficult for us to become an established player in the marketplace. Risks caused by competitors are possible, therefore the business has to monitor and evaluate its performance frequently, and collect customer evaluations and suggestions in order to continually improve.
Worst Case Risks
The worst case scenario would be that the business cannot support itself on an ongoing basis. The costs of doing business may be under-estimated, or sales and profit may be less than expected, making the business difficult in finance. Moreover, in case of social economic recession, political changes, or inflation, the business may perform even worse than has been forecasted.
As the U.S. economy recovers and quality of life is increases, people tend to spend more time and money in leisure activities rather than doing their house work. They prefer that someone else does the cleaning work for them. Hillsboro has a population of 70,000 served by seven dry cleaning and laundry shops. These existing shops wait for customers to bring their garments in and pick them up later. Customers have to drive cars to town, find parking places, carry their clothes or large items, such as curtains, blankets, etc. to the shop, and wait to be served. Then they must repeat this boring process when they come to collect their items. Moreover, these shops are only open from 9am – 6pm, and close on Sunday, which are almost the same working hours of offices; most inconvenient for customers especially those with full-time jobs.
By understanding and addressing this need, our new dry cleaning, laundry and alteration service will be established, providing door to door service free of delivery charge. We make our customers’ lives simpler by saving them time, and eliminating waiting in queues, parking problems, forgetting to collect clothes, missing meals, and going home late.
The following is the SWOT analysis for Columbia Cleaners:
Weaknesses:
Opportunities:
Place: Dealing directly with customers, conveniently in the customers’ houses in Hillsboro. We are choosing to not rent a shop in the town center, thereby reducing costs. Columbia Cleaners will receive clothes from and return them to customers’ houses. Requests for urgent situation pickups and deliveries will be accommodated, and a nominal fee charged.
Product: Free home pickup and delivery service, coming to customers’ houses between 6 pm – 9 pm three times per week. We provide convenience and high quality dry cleaning, laundry, and alteration services.
Price: Normally, new businesses set their initial prices lower than their competitors. In our situation however, the business has higher costs for our delivery service and promotions to increase customers’ awareness and establish our brand name. We will set our prices to match those of our competitors. The pricing scheme is based on a per service price. Moreover, the business targets working and professional customers who often pay less attention to price than the quality and convenience of service. Kelvin Clancy (in Kotler, 2003) shows that only between 15 and 35 percent of buyers are price sensitive. People with higher incomes are willing to pay more for features, customer service, quality, and convenience.
We will start off my matching our main competitor’s prices and we will be closely monitoring our financials to make sure that we develop a sustainable business without heavily discounting our services to win customers. All sales inquiries will be initially handled by the business owner. We will also train all our employees, especially those facing the customers, in customer service to make sure that our customers are fully satisfied, as such customers will not only stay longer with us but will also refer other customers to us. We will offer limited discounts to our customers with large recurring orders and also provide incentives for new customer referrals.
The sales forecast gradually increases over the year 2005 and comprises total sales of $324,700. However, in the last three months, October, November and December the sales remain almost level due to possible seasonal factors. Yearly forecasts are summarized in the table below.
Sales Forecast | |||
Year 1 | Year 2 | Year 3 | |
Sales | |||
Dry Cleaning | $116,892 | $151,960 | $197,548 |
Laundry | $185,079 | $240,603 | $312,784 |
Alteration Services | $22,729 | $29,547 | $38,412 |
Other | $0 | $0 | $0 |
Total Sales | $324,700 | $422,110 | $548,744 |
Direct Cost of Sales | Year 1 | Year 2 | Year 3 |
Dry Cleaning | $14,027 | $18,235 | $23,706 |
Laundry | $14,806 | $19,248 | $25,023 |
Alteration Services | $6,819 | $8,864 | $11,524 |
Other | $0 | $0 | $0 |
Subtotal Direct Cost of Sales | $35,652 | $46,348 | $60,252 |
The owner of the business will be director and accountant, working full time. A laundry expert will be employed and will be in charge of the operation and the quality of garment cleaning. Workers will report the laundry expert who reports to the owner.
Through consultations with a dry cleaning consultant, the term of reference of a laundry expert and workers are prepared. Employment information will be advertised in local newspapers. The laundry expert and two part-time workers who have experience in laundry work will be employed.
The laundry expert will be in charge of the operation and the quality of garment cleaning. Workers will be responsible for cleaning and classifying work and have duty to report daily work to the laundry expert. The expert has to report their working results and problems to the director.
Two part-time drivers for picking up and delivering clothes work from 5:30 pm – 9:30 pm three times a week.
The staff should be able to carry out working conditions and requirements:
Number of staff and salary in the period of January to March 2005:
Owner | Full-time | 1 | 23 | 40 |
Laundry expert | Full-time | 1 | 12 | 40 |
Workers | Part-time | 2 | 9 | 48 |
Drivers | Part-time | 2 | 7 | 24 |
Total | 6 | 51 | 152 |
From April 2005, the business has more customers and becomes busier, thus new staff (a worker and a driver) are employed. The business prefers to hire extra part-time workers and drivers sharing the total needed working hours. In case one of them becomes sick or busy, other staff can replace him therefore the working process will not be effected.
An average 5% increase in all salaries is planned for the following two years of operations.
Personnel Plan | |||
Year 1 | Year 2 | Year 3 | |
Director/Accountant | $48,000 | $50,400 | $52,920 |
Laundry expert | $24,960 | $26,208 | $27,518 |
Worker-1 | $11,232 | $11,794 | $12,383 |
Worker-2 | $11,232 | $11,794 | $12,383 |
Worker-3 | $8,424 | $8,845 | $9,287 |
Driver-1 | $4,368 | $4,586 | $4,816 |
Driver-2 | $4,368 | $4,586 | $4,816 |
Driver-3 | $3,276 | $3,440 | $3,612 |
Other | $0 | $0 | $0 |
Total People | 8 | 8 | 8 |
Total Payroll | $115,860 | $121,653 | $127,736 |
The following topics, the cash flow statement, profit and loss account, and balance sheet have been built using forecasted information which is as accurate and realistic as possible. Sales increase gradually over the 12 months showing the positive trend of sales. Columbia Cleaners is steadily gaining market share. Gross profit and net profit rise proportionately to sales revenue. The financial statements show that the business runs quite well and achieves expected results.
Startup expenses will be funded through a combination of owner’s equity capital and a commercial loan, as summarized in the table below.
The owner will invest $40,000 in the business. Additional capital for the business in the amount of $20,000 will be borrowed from a bank.
The lending plan has to be completed and submitted to the bank 6 months before starting the business. The loan will be needed two months in advance. Annual interest of 10% has to be paid on the long-term loans secured with fixed assets.
Start-up Funding | |
Start-up Expenses to Fund | $23,000 |
Start-up Assets to Fund | $27,000 |
Total Funding Required | $50,000 |
Assets | |
Non-cash Assets from Start-up | $17,000 |
Cash Requirements from Start-up | $10,000 |
Additional Cash Raised | $10,000 |
Cash Balance on Starting Date | $20,000 |
Total Assets | $37,000 |
Liabilities and Capital | |
Liabilities | |
Current Borrowing | $0 |
Long-term Liabilities | $20,000 |
Accounts Payable (Outstanding Bills) | $0 |
Other Current Liabilities (interest-free) | $0 |
Total Liabilities | $20,000 |
Capital | |
Planned Investment | |
J.C. Copperbeech | $40,000 |
Other investors | $0 |
Additional Investment Requirement | $0 |
Total Planned Investment | $40,000 |
Loss at Start-up (Start-up Expenses) | ($23,000) |
Total Capital | $17,000 |
Total Capital and Liabilities | $37,000 |
Total Funding | $60,000 |
The monthly break-even point of the business is calculated below. As revenue becomes higher than break-even point, the business starts to harvest the profit. As forecasted, the total demand on dry cleaning and laundry service continues to rise in the following years; therefore, if the service satisfies its customers, increases new customers and retains customer loyalty, the profit will continue to go up.
Break-even Analysis | |
Monthly Revenue Break-even | $19,205 |
Assumptions: | |
Average Percent Variable Cost | 11% |
Estimated Monthly Fixed Cost | $17,097 |
Pro Forma Cash Flow | |||
Year 1 | Year 2 | Year 3 | |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $324,700 | $422,110 | $548,744 |
Subtotal Cash from Operations | $324,700 | $422,110 | $548,744 |
Additional Cash Received | |||
Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 |
New Current Borrowing | $0 | $0 | $0 |
New Other Liabilities (interest-free) | $0 | $0 | $0 |
New Long-term Liabilities | $0 | $0 | $0 |
Sales of Other Current Assets | $0 | $0 | $0 |
Sales of Long-term Assets | $0 | $0 | $0 |
New Investment Received | $0 | $0 | $0 |
Subtotal Cash Received | $324,700 | $422,110 | $548,744 |
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $115,860 | $121,653 | $127,736 |
Bill Payments | $133,714 | $191,828 | $245,003 |
Subtotal Spent on Operations | $249,574 | $313,481 | $372,739 |
Additional Cash Spent | |||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 |
Principal Repayment of Current Borrowing | $0 | $0 | $0 |
Other Liabilities Principal Repayment | $0 | $0 | $0 |
Long-term Liabilities Principal Repayment | $334 | $0 | $0 |
Purchase Other Current Assets | $0 | $0 | $0 |
Purchase Long-term Assets | $10,000 | $0 | $0 |
Dividends | $0 | $0 | $0 |
Subtotal Cash Spent | $259,908 | $313,481 | $372,739 |
Net Cash Flow | $64,792 | $108,629 | $176,005 |
Cash Balance | $84,792 | $193,421 | $369,426 |
The table below outlines our projected profit and loss statements for the first three years of operation. In general, the business might meet some difficulties in the beginning months but after that the business grows as expected and produces a small profit at the end of the year. It is not necessary for the business to gain high profit in the first year. Nevertheless, we are expecting to make a small profit the first year. Our second and third year net profits are expected to grow quite a bit, as shown below.
Pro Forma Profit and Loss | |||
Year 1 | Year 2 | Year 3 | |
Sales | $324,700 | $422,110 | $548,744 |
Direct Cost of Sales | $35,652 | $46,348 | $60,252 |
Other Costs of Sales | $0 | $0 | $0 |
Total Cost of Sales | $35,652 | $46,348 | $60,252 |
Gross Margin | $289,048 | $375,762 | $488,492 |
Gross Margin % | 89.02% | 89.02% | 89.02% |
Expenses | |||
Payroll | $115,860 | $121,653 | $127,736 |
Marketing/Promotion | $2,250 | $2,700 | $3,000 |
Depreciation | $4,500 | $4,000 | $5,000 |
Rent | $14,400 | $15,000 | $16,000 |
Utilities | $11,100 | $12,000 | $13,000 |
Telecommunications | $4,800 | $5,000 | $5,500 |
Insurance | $10,200 | $11,000 | $12,000 |
Payroll Taxes | $0 | $0 | $0 |
Maintenance | $1,200 | $1,500 | $2,000 |
Gas | $5,250 | $6,500 | $7,500 |
Equipment lease | $20,000 | $20,000 | $20,000 |
Office cleaning | $3,600 | $4,000 | $5,000 |
Other | $12,000 | $20,000 | $30,000 |
Total Operating Expenses | $205,160 | $223,353 | $246,736 |
Profit Before Interest and Taxes | $83,888 | $152,409 | $241,756 |
EBITDA | $88,388 | $156,409 | $246,756 |
Interest Expense | $1,967 | $1,967 | $1,967 |
Taxes Incurred | $24,576 | $45,133 | $71,937 |
Net Profit | $57,345 | $105,310 | $167,853 |
Net Profit/Sales | 17.66% | 24.95% | 30.59% |
The table below shows the balance sheet annual figures for the first three years of operation. First year monthly figures are presented in the appendix.
Pro Forma Balance Sheet | |||
Year 1 | Year 2 | Year 3 | |
Assets | |||
Current Assets | |||
Cash | $84,792 | $193,421 | $369,426 |
Inventory | $4,008 | $5,210 | $6,773 |
Other Current Assets | $0 | $0 | $0 |
Total Current Assets | $88,800 | $198,631 | $376,199 |
Long-term Assets | |||
Long-term Assets | $25,000 | $25,000 | $25,000 |
Accumulated Depreciation | $4,500 | $8,500 | $13,500 |
Total Long-term Assets | $20,500 | $16,500 | $11,500 |
Total Assets | $109,300 | $215,131 | $387,699 |
Liabilities and Capital | Year 1 | Year 2 | Year 3 |
Current Liabilities | |||
Accounts Payable | $15,289 | $15,810 | $20,525 |
Current Borrowing | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 |
Subtotal Current Liabilities | $15,289 | $15,810 | $20,525 |
Long-term Liabilities | $19,666 | $19,666 | $19,666 |
Total Liabilities | $34,955 | $35,476 | $40,191 |
Paid-in Capital | $40,000 | $40,000 | $40,000 |
Retained Earnings | ($23,000) | $34,345 | $139,655 |
Earnings | $57,345 | $105,310 | $167,853 |
Total Capital | $74,345 | $179,655 | $347,508 |
Total Liabilities and Capital | $109,300 | $215,131 | $387,699 |
Net Worth | $74,345 | $179,655 | $347,508 |
Business ratios for the years of this plan are shown below. Industry profile ratios for Commercial Drycleaning and Laundry Collection and Distribution Establishments, based on the Standard Industrial Classification code 7216.9903, are shown for comparison.
Ratio Analysis | ||||
Year 1 | Year 2 | Year 3 | Industry Profile | |
Sales Growth | 0.00% | 30.00% | 30.00% | 4.37% |
Percent of Total Assets | ||||
Inventory | 3.67% | 2.42% | 1.75% | 4.37% |
Other Current Assets | 0.00% | 0.00% | 0.00% | 38.35% |
Total Current Assets | 81.24% | 92.33% | 97.03% | 55.47% |
Long-term Assets | 18.76% | 7.67% | 2.97% | 44.53% |
Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
Current Liabilities | 13.99% | 7.35% | 5.29% | 22.38% |
Long-term Liabilities | 17.99% | 9.14% | 5.07% | 24.56% |
Total Liabilities | 31.98% | 16.49% | 10.37% | 46.94% |
Net Worth | 68.02% | 83.51% | 89.63% | 53.06% |
Percent of Sales | ||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 89.02% | 89.02% | 89.02% | 100.00% |
Selling, General & Administrative Expenses | 71.36% | 64.07% | 58.43% | 77.90% |
Advertising Expenses | 0.00% | 0.00% | 0.00% | 2.06% |
Profit Before Interest and Taxes | 25.84% | 36.11% | 44.06% | 2.41% |
Main Ratios | ||||
Current | 5.81 | 12.56 | 18.33 | 1.70 |
Quick | 5.55 | 12.23 | 18.00 | 1.28 |
Total Debt to Total Assets | 31.98% | 16.49% | 10.37% | 61.40% |
Pre-tax Return on Net Worth | 110.19% | 83.74% | 69.00% | 4.39% |
Pre-tax Return on Assets | 74.95% | 69.93% | 61.85% | 11.38% |
Additional Ratios | Year 1 | Year 2 | Year 3 | |
Net Profit Margin | 17.66% | 24.95% | 30.59% | n.a |
Return on Equity | 77.13% | 58.62% | 48.30% | n.a |
Activity Ratios | ||||
Inventory Turnover | 11.85 | 10.06 | 10.06 | n.a |
Accounts Payable Turnover | 9.75 | 12.17 | 12.17 | n.a |
Payment Days | 27 | 30 | 27 | n.a |
Total Asset Turnover | 2.97 | 1.96 | 1.42 | n.a |
Debt Ratios | ||||
Debt to Net Worth | 0.47 | 0.20 | 0.12 | n.a |
Current Liab. to Liab. | 0.44 | 0.45 | 0.51 | n.a |
Liquidity Ratios | ||||
Net Working Capital | $73,511 | $182,821 | $355,674 | n.a |
Interest Coverage | 42.66 | 77.50 | 122.93 | n.a |
Additional Ratios | ||||
Assets to Sales | 0.34 | 0.51 | 0.71 | n.a |
Current Debt/Total Assets | 14% | 7% | 5% | n.a |
Acid Test | 5.55 | 12.23 | 18.00 | n.a |
Sales/Net Worth | 4.37 | 2.35 | 1.58 | n.a |
Dividend Payout | 0.00 | 0.00 | 0.00 | n.a |
Sales Forecast | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Sales | |||||||||||||
Dry Cleaning | 0% | $4,176 | $5,364 | $6,156 | $8,280 | $9,216 | $9,720 | $10,728 | $11,520 | $12,456 | $12,924 | $13,212 | $13,140 |
Laundry | 0% | $6,612 | $8,493 | $9,747 | $13,110 | $14,592 | $15,390 | $16,986 | $18,240 | $19,722 | $20,463 | $20,919 | $20,805 |
Alteration Services | 0% | $812 | $1,043 | $1,197 | $1,610 | $1,792 | $1,890 | $2,086 | $2,240 | $2,422 | $2,513 | $2,569 | $2,555 |
Other | 0% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Sales | $11,600 | $14,900 | $17,100 | $23,000 | $25,600 | $27,000 | $29,800 | $32,000 | $34,600 | $35,900 | $36,700 | $36,500 | |
Direct Cost of Sales | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Dry Cleaning | 12% | $501 | $644 | $739 | $994 | $1,106 | $1,166 | $1,287 | $1,382 | $1,495 | $1,551 | $1,585 | $1,577 |
Laundry | 8% | $529 | $679 | $780 | $1,049 | $1,167 | $1,231 | $1,359 | $1,459 | $1,578 | $1,637 | $1,674 | $1,664 |
Alteration Services | 30% | $244 | $313 | $359 | $483 | $538 | $567 | $626 | $672 | $727 | $754 | $771 | $767 |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Direct Cost of Sales | $1,274 | $1,636 | $1,878 | $2,525 | $2,811 | $2,965 | $3,272 | $3,514 | $3,799 | $3,942 | $4,030 | $4,008 |
Personnel Plan | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Director/Accountant | 0% | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 |
Laundry expert | 0% | $2,080 | $2,080 | $2,080 | $2,080 | $2,080 | $2,080 | $2,080 | $2,080 | $2,080 | $2,080 | $2,080 | $2,080 |
Worker-1 | 0% | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 |
Worker-2 | 0% | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 |
Worker-3 | 0% | $0 | $0 | $0 | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 | $936 |
Driver-1 | 0% | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 |
Driver-2 | 0% | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 |
Driver-3 | 0% | $0 | $0 | $0 | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 | $364 |
Other | 0% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total People | 6 | 6 | 6 | 8 | 8 | 8 | 8 | 8 | 8 | 8 | 8 | 8 | |
Total Payroll | $8,680 | $8,680 | $8,680 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 |
Pro Forma Profit and Loss | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Sales | $11,600 | $14,900 | $17,100 | $23,000 | $25,600 | $27,000 | $29,800 | $32,000 | $34,600 | $35,900 | $36,700 | $36,500 | |
Direct Cost of Sales | $1,274 | $1,636 | $1,878 | $2,525 | $2,811 | $2,965 | $3,272 | $3,514 | $3,799 | $3,942 | $4,030 | $4,008 | |
Other Costs of Sales | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Cost of Sales | $1,274 | $1,636 | $1,878 | $2,525 | $2,811 | $2,965 | $3,272 | $3,514 | $3,799 | $3,942 | $4,030 | $4,008 | |
Gross Margin | $10,326 | $13,264 | $15,222 | $20,475 | $22,789 | $24,035 | $26,528 | $28,486 | $30,801 | $31,958 | $32,670 | $32,492 | |
Gross Margin % | 89.02% | 89.02% | 89.02% | 89.02% | 89.02% | 89.02% | 89.02% | 89.02% | 89.02% | 89.02% | 89.02% | 89.02% | |
Expenses | |||||||||||||
Payroll | $8,680 | $8,680 | $8,680 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | |
Marketing/Promotion | $150 | $150 | $150 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | |
Depreciation | $250 | $250 | $250 | $417 | $417 | $417 | $417 | $417 | $417 | $417 | $417 | $417 | |
Rent | $1,200 | $1,200 | $1,200 | $1,200 | $1,200 | $1,200 | $1,200 | $1,200 | $1,200 | $1,200 | $1,200 | $1,200 | |
Utilities | $700 | $700 | $700 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | |
Telecommunications | $400 | $400 | $400 | $400 | $400 | $400 | $400 | $400 | $400 | $400 | $400 | $400 | |
Insurance | $700 | $700 | $700 | $900 | $900 | $900 | $900 | $900 | $900 | $900 | $900 | $900 | |
Payroll Taxes | 15% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Maintenance | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | |
Gas | $250 | $250 | $250 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | $500 | |
Equipment lease | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | |
Office cleaning | 15% | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 |
Other | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | |
Total Operating Expenses | $15,397 | $15,397 | $15,397 | $17,663 | $17,663 | $17,663 | $17,663 | $17,663 | $17,663 | $17,663 | $17,663 | $17,663 | |
Profit Before Interest and Taxes | ($5,070) | ($2,133) | ($174) | $2,811 | $5,126 | $6,372 | $8,865 | $10,823 | $13,138 | $14,295 | $15,007 | $14,829 | |
EBITDA | ($4,820) | ($1,883) | $76 | $3,228 | $5,542 | $6,789 | $9,281 | $11,240 | $13,554 | $14,712 | $15,424 | $15,246 | |
Interest Expense | $164 | $164 | $164 | $164 | $164 | $164 | $164 | $164 | $164 | $164 | $164 | $164 | |
Taxes Incurred | ($1,570) | ($689) | ($101) | $794 | $1,489 | $1,862 | $2,610 | $3,198 | $3,892 | $4,239 | $4,453 | $4,400 | |
Net Profit | ($3,664) | ($1,608) | ($237) | $1,853 | $3,473 | $4,346 | $6,091 | $7,461 | $9,082 | $9,892 | $10,390 | $10,266 | |
Net Profit/Sales | -31.59% | -10.79% | -1.38% | 8.06% | 13.57% | 16.10% | 20.44% | 23.32% | 26.25% | 27.55% | 28.31% | 28.12% |
Pro Forma Cash Flow | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Cash Received | |||||||||||||
Cash from Operations | |||||||||||||
Cash Sales | $11,600 | $14,900 | $17,100 | $23,000 | $25,600 | $27,000 | $29,800 | $32,000 | $34,600 | $35,900 | $36,700 | $36,500 | |
Subtotal Cash from Operations | $11,600 | $14,900 | $17,100 | $23,000 | $25,600 | $27,000 | $29,800 | $32,000 | $34,600 | $35,900 | $36,700 | $36,500 | |
Additional Cash Received | |||||||||||||
Sales Tax, VAT, HST/GST Received | 0.00% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
New Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Other Liabilities (interest-free) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Long-term Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales of Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales of Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Investment Received | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Received | $11,600 | $14,900 | $17,100 | $23,000 | $25,600 | $27,000 | $29,800 | $32,000 | $34,600 | $35,900 | $36,700 | $36,500 | |
Expenditures | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Expenditures from Operations | |||||||||||||
Cash Spending | $8,680 | $8,680 | $8,680 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | $9,980 | |
Bill Payments | $202 | $6,108 | $7,526 | $8,740 | $11,419 | $12,029 | $12,452 | $13,646 | $14,418 | $15,419 | $15,763 | $15,995 | |
Subtotal Spent on Operations | $8,882 | $14,788 | $16,206 | $18,720 | $21,399 | $22,009 | $22,432 | $23,626 | $24,398 | $25,399 | $25,743 | $25,975 | |
Additional Cash Spent | |||||||||||||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Principal Repayment of Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Long-term Liabilities Principal Repayment | $334 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Purchase Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Purchase Long-term Assets | $0 | $0 | $0 | $10,000 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Dividends | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Spent | $9,216 | $14,788 | $16,206 | $28,720 | $21,399 | $22,009 | $22,432 | $23,626 | $24,398 | $25,399 | $25,743 | $25,975 | |
Net Cash Flow | $2,384 | $112 | $894 | ($5,720) | $4,201 | $4,991 | $7,368 | $8,374 | $10,202 | $10,501 | $10,957 | $10,525 | |
Cash Balance | $22,384 | $22,496 | $23,390 | $17,671 | $21,872 | $26,863 | $34,232 | $42,606 | $52,808 | $63,310 | $74,267 | $84,792 |
Pro Forma Balance Sheet | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Assets | Starting Balances | ||||||||||||
Current Assets | |||||||||||||
Cash | $20,000 | $22,384 | $22,496 | $23,390 | $17,671 | $21,872 | $26,863 | $34,232 | $42,606 | $52,808 | $63,310 | $74,267 | $84,792 |
Inventory | $2,000 | $1,726 | $1,636 | $1,878 | $2,525 | $2,811 | $2,965 | $3,272 | $3,514 | $3,799 | $3,942 | $4,030 | $4,008 |
Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Current Assets | $22,000 | $24,111 | $24,132 | $25,268 | $20,196 | $24,683 | $29,828 | $37,504 | $46,120 | $56,607 | $67,251 | $78,297 | $88,800 |
Long-term Assets | |||||||||||||
Long-term Assets | $15,000 | $15,000 | $15,000 | $15,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 |
Accumulated Depreciation | $0 | $250 | $500 | $750 | $1,167 | $1,583 | $2,000 | $2,417 | $2,833 | $3,250 | $3,667 | $4,083 | $4,500 |
Total Long-term Assets | $15,000 | $14,750 | $14,500 | $14,250 | $23,833 | $23,417 | $23,000 | $22,583 | $22,167 | $21,750 | $21,333 | $20,917 | $20,500 |
Total Assets | $37,000 | $38,861 | $38,632 | $39,518 | $44,029 | $48,100 | $52,828 | $60,087 | $68,286 | $78,357 | $88,585 | $99,213 | $109,300 |
Liabilities and Capital | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Current Liabilities | |||||||||||||
Accounts Payable | $0 | $5,858 | $7,238 | $8,360 | $11,018 | $11,615 | $11,998 | $13,166 | $13,904 | $14,894 | $15,229 | $15,468 | $15,289 |
Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Subtotal Current Liabilities | $0 | $5,858 | $7,238 | $8,360 | $11,018 | $11,615 | $11,998 | $13,166 | $13,904 | $14,894 | $15,229 | $15,468 | $15,289 |
Long-term Liabilities | $20,000 | $19,666 | $19,666 | $19,666 | $19,666 | $19,666 | $19,666 | $19,666 | $19,666 | $19,666 | $19,666 | $19,666 | $19,666 |
Total Liabilities | $20,000 | $25,524 | $26,904 | $28,026 | $30,684 | $31,281 | $31,664 | $32,832 | $33,570 | $34,560 | $34,895 | $35,134 | $34,955 |
Paid-in Capital | $40,000 | $40,000 | $40,000 | $40,000 | $40,000 | $40,000 | $40,000 | $40,000 | $40,000 | $40,000 | $40,000 | $40,000 | $40,000 |
Retained Earnings | ($23,000) | ($23,000) | ($23,000) | ($23,000) | ($23,000) | ($23,000) | ($23,000) | ($23,000) | ($23,000) | ($23,000) | ($23,000) | ($23,000) | ($23,000) |
Earnings | $0 | ($3,664) | ($5,272) | ($5,508) | ($3,655) | ($182) | $4,164 | $10,254 | $17,716 | $26,798 | $36,689 | $47,079 | $57,345 |
Total Capital | $17,000 | $13,336 | $11,729 | $11,492 | $13,345 | $16,819 | $21,164 | $27,255 | $34,716 | $43,798 | $53,690 | $64,080 | $74,345 |
Total Liabilities and Capital | $37,000 | $38,861 | $38,632 | $39,518 | $44,029 | $48,100 | $52,828 | $60,087 | $68,286 | $78,357 | $88,585 | $99,213 | $109,300 |
Net Worth | $17,000 | $13,336 | $11,729 | $11,492 | $13,345 | $16,819 | $21,164 | $27,255 | $34,716 | $43,798 | $53,690 | $64,080 | $74,345 |
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By Amber Sheppard, Esq. | Legally reviewed by Amber Sheppard, Esq. | Last reviewed September 25, 2024
This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw’s team of legal writers and attorneys and in accordance with our editorial standards .
The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors . We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area .
Are you looking to start a cleaning service? There are many advantages to operating a cleaning business. For example, you have low overhead for a new business, minimal startup costs, flexibility in your hours, and, in most cases, do not need specialized education or training. Follow this article to create a business plan, secure funding, and understand environmental regulations for your cleaning business.
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Determine the scope of your cleaning business.
Will you clean homes or businesses? House cleaning services have different considerations than commercial cleaning businesses.
Do you plan to focus on one type of cleaning? Some new businesses focus only on one of the following cleaning jobs:
If you plan to offer a specific service, find out if you need any special equipment or training. Your pricing structure should consider additional overhead costs like continuing education classes or increased business insurance.
Before you launch your own cleaning business, it's critical to know your target market. First, you should know your potential customers and what they look for when hiring a cleaner.
Research the market rates in your area. Do similar companies charge by flat rates, square footage, or hourly rates? What do they charge? Can you offer similar rates and still turn a profit?
An easy way to set yourself apart from other residential cleaning businesses is to focus on one or two growing areas for a cleaning company.
Some examples include:
Pick a niche that aligns with your business plan and values. If you aren't passionate about eco-friendly green cleaning, don't make it a pillar of your business.
Knowing all your costs before starting your business is essential to ensure profitability. You will have upfront costs such as business formation, cleaning supplies like mops, and equipment. Will you need a company vehicle? Determine the costs of a car, including insurance.
Also, consider your ongoing expenses, such as:
Small business owners should be realistic about their costs and what they can expect to see as profits. Many local businesses don't show a profit after several months or even a year after opening.
Analyze how to fund your cleaning service with a business plan.
Even a one-person business benefits from an organized business plan . If you need a loan to fund your business, you need a business plan to show banks or potential investors.
Your business plan doesn't have to cover everything, but you should address critical areas, such as:
These are questions you should answer to determine the scope of your business. Once you know these answers, you will have an idea of how much money you need to fund your startup.
Before you can start invoicing clients, you need to open your business and provide cleaning services. To do that, you need funding.
Crowdfunding is only a likely option if you plan on starting nationwide. Pay attention to interest rates and repayment terms no matter which source you choose.
You will need a business name. Your business name is important—it's part of your brand.
First, research your business name to see if it's already in use. Avoid brand confusion and potential trademark infringement by using the same or a similar name as another business. Check for its use on social media and in an internet search before printing business cards.
Once you pick a name, you must register it. If you're a sole proprietor, you file a fictitious business name or a doing business as (DBA). This filing links to your legal name. Check your business name with your county clerk or secretary of state to determine their filing requirements.
If you choose a legal structure such as a corporation, partnership, or limited liability company (LLC), register the business name with the secretary of state. You don't need to file a separate name registration.
Many small businesses operate as sole proprietorships. But this exposes you to personal liability for your janitorial services-based business operations. In addition to sole proprietorship, there are other legal entities to consider.
Corporations provide liability protection. This means your business operations are separate from your personal assets. If you opt for a corporation and want to avoid double taxation , consider filing Form 2553 with the Internal Revenue Service (IRS) for a subchapter S corporation .
If you plan to have a partner, you may consider a partnership . In a partnership, the partners share the company's profits, losses, and liabilities personally. There's no personal asset protection.
An LLC is a type of corporation that avoids double taxation. The main advantage of forming a corporation or an LLC is liability protection. A corporation or LLC separates your business assets and liabilities from your personal assets. So, if a client were to sue you for negligence (i.e., if you accidentally ruined an antique rug), the client could only go after the assets in the corporate entity, not you personally.
Similarly, suppose an employee is injured on the job. In that case, they can only sue the corporate entity, not you, for personal injuries.
Another advantage is that clients view an LLC or corporate entity as more professional. So, if you plan to clean for businesses, they prefer paying a corporation instead of an individual.
Businesses don't want to pay individuals because they don't want the liability as a business employee. The business will need to file 1099 forms for independent contractors . Businesses also don't want any liability associated with your services.
If you hire employees, conduct background checks before allowing them into your client's homes or offices. Suppose they attack someone or damage property, and you could have anticipated it from their background check. In that case, your business may be liable for damages.
You must get an employer identification number (EIN) when hiring employees, even as a sole proprietor. You'll use this number on all your business tax filings.
Before starting your cleaning service business, you must get your state or local town's appropriate business licenses and permits. Investigate whether you need special permits or training to perform certain cleaning services.
Suppose you're handling dangerous materials such as biohazardous waste. In that case, you may need certain state permits or to follow Occupational Health and Safety regulations ( OSHA regulations ).
You must follow environmental law regulations and laws. This includes waste disposal regulations. An easy real-world scenario is where your commercial cleaning business has a business contract with an art facility. The facility uses oil-based paints for its work. The water they use to clean supplies or create work is now contaminated. You must dispose of that water in line with federal environmental regulations, even if you're just cleaning.
The Environmental Protection Agency (EPA) , Department of Energy (DOE) , and U.S. Department of Agriculture (USDA) enforce environmental regulations. Failure to follow federal and state laws can result in fines, criminal charges, and a shutdown of your business. If you don't dispose of waste properly, toxic tort class action lawsuits can be filed against you.
The EPA has the Office of Small and Disadvantaged Business Utilization (OSDBU) to help small businesses understand these regulations and be in compliance.
While a cleaning service can be lucrative, it is a business with inherent risks. There is a potential for accidents when dealing with hazardous chemicals, physical labor, and personal property. You should insure your cleaning business because there are risks of bodily injury and property damage.
Look into the different types of business insurance policies .
If you have employees, you must get a workers' compensation policy in case of an injury at work.
You are your best advertisement. First, let people know about your new residential cleaning services business. Then, once you complete a job to your customers' satisfaction, ask them if you can use them as references for your business. The easiest way is for them to leave a review on social media or Google.
Ask your customers if they can give referrals of your work to their friends and family. Again, word-of-mouth advertising is the best and cheapest way to market your services.
Make sure your company drafts a contract for each customer. This helps set expectations and responsibilities for you and your client. Include the following in your document:
Don't be in such a rush to land a client that you skip this process. Even with a signed contract, make sure you know the refund policy of your state. Some states follow the cooling-off period , which allows a refund within a set number of days after purchase.
While you can launch your cleaning service business by yourself, it may help to use a local business attorney to meet all the legal requirements and safety regulations.
However, if you are ready to start your business, you can let our trusted partner LegalZoom handle your business formation filing for $99 plus filing fees.
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Are you looking for a complete guide to creating a successful dry cleaning business plan? Look no further than the #1 Dry Cleaning Business Plan Template & Guidebook. It offers detailed and simple steps to help you create a plan that will provide the structure and guidance you need to take your dry cleaning business to the next level. With this comprehensive guide, get ready to launch your dry cleaning business on the right path and make a profit!
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1. describe the purpose of your dry cleaning business..
The first step to writing your business plan is to describe the purpose of your dry cleaning business. This includes describing why you are starting this type of business, and what problems it will solve for customers. This is a quick way to get your mind thinking about the customers’ problems. It also helps you identify what makes your business different from others in its industry.
It also helps to include a vision statement so that readers can understand what type of company you want to build.
Here is an example of a purpose mission statement for a dry cleaning business:
Our mission at [NAME OF DRY CLEANING BUSINESS] is to provide top-notch dry cleaning services to our customers in a safe, responsive, and environmentally conscious manner. We aspire to be the most trusted and dependable choice in the area for all of our customers' clothing needs, delivering the best in quality and service. We will build strong relationships with our customers and employees by operating with honesty, integrity, and respect.
The next step is to outline your products and services for your dry cleaning business.
When you think about the products and services that you offer, it's helpful to ask yourself the following questions:
You may want to do a comparison of your business plan against those of other competitors in the area, or even with online reviews. This way, you can find out what people like about them and what they don’t like, so that you can either improve upon their offerings or avoid doing so altogether.
If you don't have a marketing plan for your dry cleaning business, it's time to write one. Your marketing plan should be part of your business plan and be a roadmap to your goals.
A good marketing plan for your dry cleaning business includes the following elements:
Next, you'll need to build your operational plan. This section describes the type of business you'll be running, and includes the steps involved in your operations.
In it, you should list:
The second part of your dry cleaning business plan is to develop a management and organization section.
This section will cover all of the following:
This section should be broken down by month and year. If you are still in the planning stage of your business, it may be helpful to estimate how much money will be needed each month until you reach profitability.
Typically, expenses for your business can be broken into a few basic categories:
Startup Costs
Startup costs are typically the first expenses you will incur when beginning an enterprise. These include legal fees, accounting expenses, and other costs associated with getting your business off the ground. The amount of money needed to start a dry cleaning business varies based on many different variables, but below are a few different types of startup costs for a dry cleaning business.
Running & Operating Costs
Running costs refer to ongoing expenses related directly with operating your business over time like electricity bills or salaries paid out each month. These types of expenses will vary greatly depending on multiple variables such as location, team size, utility costs, etc.
Marketing & Sales Expenses
You should include any costs associated with marketing and sales, such as advertising and promotions, website design or maintenance. Also, consider any additional expenses that may be incurred if you decide to launch a new product or service line. For example, if your dry cleaning business has an existing website that needs an upgrade in order to sell more products or services, then this should be listed here.
A financial plan is an important part of any business plan, as it outlines how the business will generate revenue and profit, and how it will use that profit to grow and sustain itself. To devise a financial plan for your dry cleaning business, you will need to consider a number of factors, including your start-up costs, operating costs, projected revenue, and expenses.
Here are some steps you can follow to devise a financial plan for your dry cleaning business plan:
Why do you need a business plan for a dry cleaning business.
A business plan is an essential tool for any business, including a dry cleaning business. It provides a roadmap for the business owners to follow in setting up and running their business. A sound business plan should include a comprehensive market analysis, an understanding of the competition and costs associated with the dry cleaning business, an operational budget and staffing plan, a marketing strategy, and financial projections. A well-written business plan can help entrepreneurs secure financing from investors or lenders, ensure they are well-prepared to manage their business operations and stay in compliance within their industry regulations.
You should consult a business adviser or accountant who has experience in the dry cleaning sector to help you create your business plan. They can provide invaluable insight into the industry, help you develop accurate financial projections, and ensure that you have the best possible plan for your business. Additionally, it is beneficial to reach out to other dry cleaners in your area to get feedback and advice on the current industry trends and best practices.
Yes, you can write your own dry cleaning business plan. First, you will need to research the dry cleaning industry and gather information on the current market conditions, customer needs, and competitive landscape. You will then need to outline your plan for operations and finances, along with a marketing strategy. Additionally, consider key details such as location and pricing so that you can set yourself apart from the competition. Once you have outlined your business plan, it is important to seek input from professionals in the industry to get their thoughts on your ideas and to ensure that your plan is comprehensive and realistic.
We're newfoundr.com, dedicated to helping aspiring entrepreneurs succeed. As a small business owner with over five years of experience, I have garnered valuable knowledge and insights across a diverse range of industries. My passion for entrepreneurship drives me to share my expertise with aspiring entrepreneurs, empowering them to turn their business dreams into reality.
Through meticulous research and firsthand experience, I uncover the essential steps, software, tools, and costs associated with launching and maintaining a successful business. By demystifying the complexities of entrepreneurship, I provide the guidance and support needed for others to embark on their journey with confidence.
From assessing market viability and formulating business plans to selecting the right technology and navigating the financial landscape, I am dedicated to helping fellow entrepreneurs overcome challenges and unlock their full potential. As a steadfast advocate for small business success, my mission is to pave the way for a new generation of innovative and driven entrepreneurs who are ready to make their mark on the world.
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Writing a dry cleaning business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan: 1. Executive Summary. An executive summary is the first section planned to offer an overview of the entire business plan.
The Plan. Our dry cleaning business plan is structured to cover essential aspects vital for a comprehensive strategic framework. It details the business's operational processes, marketing strategies, market analysis, competitive landscape, management team, and financial projections. Executive Summary: Offers an overview of your dry cleaning ...
Dry Cleaning Business Plan Template. Over the past 20+ years, we have helped over 1,000 entrepreneurs and business owners create business plans to start and grow their dry cleaning businesses. On this page, we will first give you some background information with regards to the importance of business planning.
Store design/build: $150,000. Three months of overhead expenses (payroll, rent, utilities): $150,000. Marketing costs: $50,000. Working capital: $50,000. Easily complete your Dry Cleaning business plan! Download the Dry Cleaning business plan template (including a customizable financial model) to your computer here <-.
Operations Plan: Detail the day-to-day operations of the dry cleaning business, covering aspects such as equipment, suppliers, staffing, and quality control measures. Financial Plan: Present a comprehensive financial plan, including startup costs, revenue projections, profit margins, and a break-even analysis, demonstrating the financial ...
Creating a Business Plan for Your Dry Cleaning Business. A business plan is crucial for your dry cleaning business. It secures funding, attracts investors, and guides you through startup and operation. It takes time, but the effort pays off with a clear vision and necessary insights. You can start from scratch, use templates, or hire professionals.
Creating a business plan is essential for ensuring the success of a new project, such as a dry cleaning business. It provides an opportunity to identify potential risks and develop strategies to address them before starting the business. In short, a good business plan will help ensure the profitability of your dry cleaning business.
Let's explore the key steps involved in setting up your own dry cleaning business: 1. Research and Planning. Before diving into the world of starting a dry cleaning business, conducting thorough research and careful planning is crucial. This phase includes market research and developing a comprehensive business plan.
A good business plan for a dry cleaning service must cater to the unique aspects of the dry cleaning industry. Initially, it's important to provide a comprehensive overview of the market. This includes up-to-date statistics and identifying emerging trends within the sector, similar to what we've incorporated in our dry cleaning business plan ...
Dry Cleaning Business Plan Template. If you want to start a successful dry cleaning business or expand your current dry cleaning service, you need a business plan. Fortunately, you're in the right place. Our team has helped develop over 100,000 business plans over the past 20 years, including thousands of dry cleaning business plans.
A business plan for a dry cleaners business is necessary for a number of reasons. Firstly, it will enable the business owner to establish their goals and objectives for the business, including setting out a long-term vision. Secondly, the business plan will help to identify the resources needed to get the business off the ground, such as ...
Calculate how much you need to start. On average, the initial capital needed to open a dry cleaning business can vary significantly, ranging from approximately $20,000 to $100,000 for a modest operation to $150,000 to $500,000 for a full-service dry cleaner in a prime location with state-of-the-art equipment.
6. Open a business bank account and secure funding as needed. When starting a dry cleaning business, establishing a solid financial foundation is crucial. Opening a business bank account separates personal finances from business transactions, making it easier to manage cash flow and taxes.
Dry Cleaning Home Delivery Business Plan. Columbia Cleaners is a start-up dry cleaning, laundry and alterations service business. They are offering a new service, home pickup and delivery of garments and items, instead of the traditional drop.
Contact your local and state officials to obtain and file the necessary paperwork to start your dry cleaning business. If you plan on hiring a staff, you may also need to contact the Internal Revenue Service to register your business and receive an Employer Identification Number. 3. Rent or purchase equipment.
In our laundromat business plan template products and services section, we cover: Dry cleaning services: a selection of services including dry cleaning, ironing, laundry, stain removal and washing sensitive materials. Self-service laundry: using either an eco-friendly detergent or otherwise when washing clothes.
A dry cleaner business plan should have a well-developed marketing, operational, financial, and growth strategy and a 5 year pro-forma financial plan with monthly and quarterly detail. Capital West Advisors develops high quality business plans at the most competitive rates in the industry. Contact Capital West Advisors for a free consultation.
1 Dry cleaning machine - 25 lb. 1 Roller Iron 40 x 12 inch, variable speed and vacuum exhauster. 1 Ironing table with steaming vacuum board, integral 2 gallon boiler, iron, water pump and light. Capital plan: The owner will invest $40,000 in the business.
Even a one-person business benefits from an organized business plan. If you need a loan to fund your business, you need a business plan to show banks or potential investors. Contents of a Cleaning Business Plan. Your business plan doesn't have to cover everything, but you should address critical areas, such as: What is your business?
2331 Thain Grade #104, Lewiston, ID 83501. Classic Martinizing and Dry Cleaning. Dry Cleaners, Tailor. BBB Rating: A+. (208) 743-4655. 771 20th Ave, Clarkston, WA 99403-3109. Greenacres Dry ...
How to Write a Dry Cleaning Business Plan in 7 Steps: 1. Describe the Purpose of Your Dry Cleaning Business. The first step to writing your business plan is to describe the purpose of your dry cleaning business. This includes describing why you are starting this type of business, and what problems it will solve for customers.
411 S. Main St., Moscow, ID 83843 [email protected]. Western Laundry is a locally owned dry cleaners, serving the Palouse in Moscow and Pullman. We do everything from simple fluff and fold laundry to complicated.
Some popular services for dry cleaning include: Formal Wear. Laundry Locker Pick-up & Drop-off. Ironing. Comforters. Garment Repair Services. Best Dry Cleaning in Moscow, ID 83843 - Western Laundry, Busy B Dry Cleaners.
Specialties: Western Laundry is a locally owned dry cleaners, serving the Palouse in Moscow and Pullman. We do everything from simple fluff and fold laundry to complicated leather care, personal household items to large business/university orders. We're committed to providing our community with competitive pricing, exceptional customer care, while ensuring we stay Eco-friendly. Sign up online ...