Start-up Funding | |
Start-up Expenses to Fund | $2,625 |
Start-up Assets to Fund | $80,000 |
Total Funding Required | $82,625 |
Assets | |
Non-cash Assets from Start-up | $79,000 |
Cash Requirements from Start-up | $1,000 |
Additional Cash Raised | $0 |
Cash Balance on Starting Date | $1,000 |
Total Assets | $80,000 |
Liabilities and Capital | |
Liabilities | |
Current Borrowing | $0 |
Long-term Liabilities | $0 |
Accounts Payable (Outstanding Bills) | $2,000 |
Other Current Liabilities (interest-free) | $0 |
Total Liabilities | $2,000 |
Capital | |
Planned Investment | |
Personal Investment | $80,625 |
Other | $0 |
Additional Investment Requirement | $0 |
Total Planned Investment | $80,625 |
Loss at Start-up (Start-up Expenses) | ($2,625) |
Total Capital | $78,000 |
Total Capital and Liabilities | $80,000 |
Total Funding | $82,625 |
Southeast Racing Parts will be located at 123 Main Street, Anytown, North Carolina. This location will afford us good visibility along with convenient access for traveling race teams wishing to stop at our location.
Another advantage of this location is the recent announcement of a go-kart/entertainment complex, which will be located directly across the street. This complex will attract many potential customers to our immediate vicinity.
By locating in close proximity to Charlotte, Southeast Racing Parts will enjoy a large built-in customer base. The skyrocketing popularity of NASCAR Winston Cup racing in the last 15 years has only strengthened its role as the hub for most race teams and all the related businesses they’ve spawned.
The sport’s explosion has been so boundless that University of North Carolina-Charlotte researchers conducted a study of the industry to try to determine its impact. The study, completed in December 1996, found that in its surrounding counties, NASCAR racing is responsible for about 2,000 jobs producing more than $200 million in expenditures annually — figures that many in the industry consider conservative in 1998. Many of the people employed within the industry along with their children, other relatives, and friends, take up racing as a hobby.
The Facility We will initially be leasing 3,000 sq. ft. of a new 10,000 sq. ft. building. As needs dictate, our office and/or warehouse facilities could be expanded into an additional 2,500 sq. ft.
We will be sharing this facility with another business that is also involved in racing, and their business attracts many of the local racers. In light of this, we will meet many potential customers simply because of our association with them.
This location will consist of a showroom, office space, and warehousing. All deliveries and shipments will be serviced at this location. We will also have ample parking available.
Southeast Racing Parts will sell racing products to the entry-level/novice racer. These products will include engine and chassis parts along with safety and set-up equipment. Services that we will provide include coil spring rating, along with a scaling service for race cars.
Southeast Racing Parts will assist its customers in selecting the best parts for their application at a price that meets or exceeds their expectations. In the event of a problem, we will be there to assist and counsel the customer to a speedy solution.
We will carry or have quick access to most major lines of racing equipment. We will also carry generic “plain label” merchandise that we will market under our own performance name. Private labeling will allow us, in most cases, to greatly increase our profit margins since the procurement costs are much lower for these types of items.
Even though our target market is the entry-level racer, our product mix will be sufficient to fill most of the needs of even the most hard-core racer. With leisure time at a premium, our reputation for having needed items in-stock will save our customers both time and money. We will be open Monday through Saturday with hours yet to be determined.
Our experience has shown that most entry-level racers’ preference is for low prices. We believe we can offer products that indeed are lower in price without sacrificing the performance and safety concerns that our customers will demand. Southeast Racing Parts will provide precisely the level of service that today’s entry-level racer requires.
Within our niche, we only have one significant competitor. They, however, do not carry engine parts, which should give us an edge in that respect.
In general, however, our competition is not in our targeted portion of the market. This competition consists mainly of these three groups:
More discussion is included later in this plan on competitive businesses.
To drive sales initially, Southeast Racing Parts will utilize an existing supply catalog. This four-color catalog will have a different cover with the Southeast Racing Parts logo, phone number, etc., printed on it.
After much research, we found that the product mix in this catalog most closely resembles the needs of the consumer niche that we are focusing upon. An agreement was reached to supply these catalogs to us at no charge. This precludes the need to invest in catalog production at the outset. In turn, we will be using the catalog company as a supplier for some of the inventory lines that we carry. We have developed a price sheet to be enclosed with each catalog.
We will produce flyers in-house on an as-needed basis. These will primarily be to showcase new products and/or to advertise special sales promotions. The flyers will be distributed in the same fashion as the catalogs.
Following are planned means of catalog distribution:
This is an area that we feel we will enjoy a distinct advantage over much of our competition. Because of our past work experience in purchasing, we have a vast number of supplier contacts within the racing industry. We have good, long-term, solid relationships with many of these vendors which, in many cases, will allow us to achieve decreased cost-of-goods and/or additional terms. Many of these suppliers have already committed to special deals for us, such as waiving their buy-in requirements, additional payment terms, sales referrals, etc.
We will purchase our inventory from both regional wholesalers and direct from the manufacturers. We will use the regional wholesalers more initially because of their ability to service us faster. This will lower our margins slightly; however, we feel that the upside will be that it will allow us to turn our inventory faster. As our sales volume increases, we will shift our buying patterns away from the wholesalers and purchase more of our inventory direct, which will result in increased profits.
All computer hardware and software systems that will be utilized by Southeast Racing Parts have been carefully and diligently evaluated. We will use off-the-shelf, PC-based software for accounting purposes including AR/AP, inventory, purchasing, sales, and returns. We will start out with three workstations and expand upon that as necessary.
Many of the computer systems used in the racing industry today are outmoded and obsolete. The major suppliers are reluctant to change because of the huge capital expense to change over their systems at one time. Hence, they keep going with the old and outdated.
By choosing this software, our training costs will be reduced tremendously. Much of the software used by competitors takes weeks to learn and master. Southeast Racing Parts’s use of this software will enable a basic, computer-literate employee to learn the system in one day.
This system will speed our order entry process, assist us in sales forecasting, and allow us to give a higher level of customer service.
We must remain on top of new products and trends. The most important factor in developing future products is market need. Our understanding of the needs in our market niche is one of our competitive advantages.
As stated earlier, we will have our own private label brand. Not only are profit margins better than name brands, but these accessories will help build name identity and awareness for Southeast Racing Parts when they are used on the race track. As our sales volume increases, this will be an area that we can expand.
Another natural area for expansion in the future would be the implementation of a website. On-line commerce is becoming an increasingly attractive option, due to relatively low cost of operation, the global reach of the medium, and the increasing security. Our business model could quite easily expand to include a form of Internet commerce in a variety of racing equipment.
Overall it is estimated that the total retail market for hardcore racing products is $1.5 billion annually and it still continues to grow.
The only real threat to our venture would be a similar new entry to the marketplace. This opportunity may best be described as one ready and waiting for the first entrant who arrives with a well-conceived plan, sufficient industry experience, and the required capitalization.
The racing industry is in a boom period. While there are many items from various vendors available, Southeast Racing Parts has approached the market as a specialty retailer — a provider of parts and services to the entry-level racer.
Our target customer in this segment will have a wide range of racing and automotive skills, but our most important target customers are relatively unsophisticated at racing. We will be able to serve this customer well not only by offering them parts at an affordable price, but also by giving them advice that ensures they get the task done correctly, therefore improving their on-track performance.
Our segment definition is in and of itself strategic. We are not intending to satisfy all users of racing equipment, but rather those who are just starting out and those who are struggling to keep up. We can save our customers time and money, not so much within our pricing structure, but by assessing their needs and directing them toward the proper product. Racers, by nature, tend to desire a high-end product, when often a low to mid-end product will do as good as, or sometimes even a better job. By always dealing in an honest and ethical manner, we will build customer loyalty and word-of-mouth sales that many of our competitors are lacking.
Trends are in our favor. We have identified four major trends that help us:
Since our target market is the entry-level racer, the most important needs are service, price, and availability, in that order. One of the key points of our strategy is to focus on target segments that know and understand these needs and are willing for us to fulfill those needs.
With expanded television coverage and an enormous base of grassroots motorsports activity, auto racing is a thriving industry, as well as the fastest growing sport in America. As with baseball, it could be argued that auto racing has grown to such popularity because of its vital grassroots foundation. Our customers will be the Little Leagues and softball leagues of auto racing. Outsiders to the racing industry must understand that racers may be the most obsessive consumers of any industry. Because of the pressure to win, they avidly purchase new technology. In most race cars, several parts will become obsolete in the course of a season, even though they function perfectly well.
Racers are hard on their investment, too. New tires might be a weekly purchase, and several engine freshening expenditures might be called for in a season. A good whack at the outside wall, and a racing retailer has a customer or two for shocks, a-arms, fasteners, hubs, and more.
Racers spend what it takes to win; they are not out merely to enjoy the ride. Any person who has spent any time at all in the racing pit has heard the guy in front of him in the snack bar line describe how he postponed a key household expense–the telephone bill or a new household appliance–to purchase a new right rear tire, or other critical racing part.
To service this sport, there are thousands of small businesses across the country skilled in the ways of horsepower and hooking it to the ground. Whether they make their money from parts or services, retailing or building engines, these businesses make it an easy and convenient matter to go racing. Without these local ambassadors of speed, it is hard to imagine the existence of auto racing in a large scale.
Generally, traditional distribution channels are followed. The products are bought from distributors and/or direct from the manufacturers, who have little say in how products are marketed. As in most industries, price levels decrease as volume increases.
We feel that racers understand the concept of service and availability, and are much more likely to pay for it when the offering is clearly stated.
There is no doubt that we will compete much more against the large mail order outfits than against any small local suppliers. We have good indications that racers/customers would rather pay 5-15% more for a long-term relationship with a vendor providing quality service and support. To this point, the racer thinks about price because that’s what he sees emphasized by the mail order companies.
Availability is of utmost importance. The buyer tends to want immediate, local solutions to their problems and/or needs.
By positioning ourselves at the lower end of the market, we will present ourselves to consumers just getting into racing, and we will sell to a base of customers that we can grow with together.
The above are all targeted towards the professional (NASCAR Winston Cup, etc.) market. They carry a totally different product mix to service that market. Their prices are high, and their interest in selling to the entry-level market is basically nonexistent.
These are both late model chassis builders not targeting the entry-level market. Basically, they stock inventory that’s used just on their own cars. They are both located in the Anytown Motorsports Center business park which is in an out-of-the-way, hard to find location.
They are a large drag racing mail order firm that is skimming the circle track gravy. Since Southeast Racing Parts will cater to the circle track market, we believe that whatever local circle track customers they have will switch suppliers. We will have more knowledge and experience to suit their needs.
As implied in their name, they sell used parts, so in most cases they’re not usable for our target market. They also sell a limited amount of new parts; however, because of their name, most people are not aware of this. Also, they are located in an area which was described earlier as a poor location.
They are the only local competitor that we could identify that was targeting our niche. Following are what we feel are some of our competitive advantages: We feel that we are in a much better location. They utilize a black and white flyer as their main sales tool, and we will have a professional four-color catalog. Also, they concentrate mainly on chassis and safety equipment, where we will also offer a full array of engine parts.
We are part of the Performance Racing Industry, which includes several kinds of businesses.
Speed Shops : Most of these are small, sometimes part-time ventures run from the individual’s home. Sometimes they will service a local race track; however, they usually carry a very minimal amount of inventory, and are usually operated by a racer or an ex-racer depending solely upon a small circle of friends or acquaintances as customers. They normally are short on business and marketing skills.
Engine & Chassis Builders : Typically these are well-respected firms supplying engines and chassis to the racing industry. Their customer profile lies in the mid to upper end of the market. They offer superb technical support; however, it is only available to customers utilizing their engine or chassis. They stock parts to service their engine or chassis, but are usually limited in areas areas beyond that. Normally their pricing structure is slightly above average.
Mail Order : The racing industry is served increasingly by large mail order firms that offer aggressive pricing on racing components. They are usually impersonal, and have little or no technical support available. For the purely price-driven buyer who purchases parts and expects no support, these firms offer a good option.
Others : There are many other channels through which people buy their racing parts, usually variations of the main three types above.
Our strategy is based on serving the niche of entry-level racers well. This area is full of small race teams that can’t get products or services from the major vendors who focus only on professional race teams. Also:
The retail marketing strategy of Southeast Racing Parts centers on creating a corporate identity that clearly defines our market niche in terms that benefit our customer. Other specific strategies that will be used follow:
All marketing decisions with regard to specific media choices, frequency, size, and expenditures will be conducted on an on-going basis with careful considerations of returns generated.
Our most important vehicle for sales promotion will be our catalog, which is discussed earlier in this plan.
Our customers will buy our products at our location. However, we anticipate a significant amount of mail order sales in order to meet or exceed our Sales Forecast. We will receive orders by mail, phone, or fax, process them immediately, and ship the goods via United Parcel Service.
In the event we are out of an item or we don’t stock it, many of our vendors have offered drop shipping as a service to us. This will allow us to keep our service at a high level, yet let us keep our inventory levels in check.
In the future, electronic commerce with a secure website will be thoroughly investigated for feasibility.
Our customers are especially sensitive to value. We must ensure that our price and service are perceived to be a good value to the racers. However, in the nearly thirty years of experience that we have accumulated in the racing industry, one message rings true: someone can always beat you on price.
Therefore, our pricing strategy is to be competitive within the various product categories, but not to rely on the selling price to overshadow the other advantages of doing business with our company. We will sell ourselves on the basis of a diverse line of quality products, that are readily available, reasonably priced, and backed up by our extraordinary customer service. The products will be checked prior to shipment and all promised shipping dates will be met.
We will strive for a modest gross profit margin, increasing that steadily by year four.
Because Southeast Racing Parts is a new entity, we understand that we will have to prove our company’s worth to racers in order to earn their respect and business.
Most importantly, we need to sell our company, not necessarily the products. We will need to push our service and support capabilities.
The following table and related charts show our present sales forecast. We are projecting sales to grow at steadily for the next three years.
Our seasonality, as shown in the chart, is a factor in the racing industry. We will tend to sell much better in the period January through June, while sales trail off in late summer and fall.
Management feels these forecasts are highly attainable.
When Performance Racing Industry completed its annual survey, the resulting figure for total number of racers was 385,000. Within the survey they also found that 150,000 of those were oval track racers. The survey also showed $1.5 billion in annual retail sales for all segments, with 48% of that total ($720 million) derived from the oval track segment.
By dividing that number ($720 million) by the number of oval track racers (150,000), the average annual retail purchases of oval track racers equals $4,800. From our past experience, we believe that each customer we have would spend on average 25% of that figure ($1,200) with our company. Finally, by dividing our first year sales forecast ($350,000) by $1,200 (average annual customer purchases), it shows that we will need 292 customers to support the sales forecast numbers. We believe, by and large, that these are realistic and attainable numbers.
Sales Forecast | |||
Year 1 | Year 2 | Year 3 | |
Sales | |||
Inventory Sales | $350,219 | $455,285 | $591,870 |
Internet Marketing | $16,800 | $16,800 | $16,800 |
Total Sales | $367,019 | $472,085 | $608,670 |
Direct Cost of Sales | Year 1 | Year 2 | Year 3 |
Inventory | $245,154 | $314,147 | $402,472 |
Internet Marketing | $0 | $0 | $0 |
Subtotal Direct Cost of Sales | $245,154 | $314,147 | $402,472 |
We have the ability to build strong strategic alliances with many of our suppliers, some of which are listed below.
The following two local warehouses will help us immensely in keeping our own inventory levels in check, while still giving our customers fast service:
Approached properly, these vendors and many others will assist Southeast Racing Parts in becoming a force in the marketplace.
Sample Milestones topic text.
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.
Milestones | |||||
Milestone | Start Date | End Date | Budget | Manager | Department |
Sample Milestones | 1/4/2008 | 1/4/2008 | $0 | ABC | Department |
Finish Business Plan | 5/7/2009 | 6/6/2009 | $100 | Dude | LeGrande Fromage |
Acquire Financing | 5/17/2009 | 7/6/2009 | $200 | Dudette | Legumers |
Ah HA! Event | 5/27/2009 | 6/1/2009 | $60 | Marianne | Bosses |
Oooooh Noooooo! Event | 6/26/2009 | 7/1/2009 | $250 | Marionette | Chèvre deBlâme |
Grande Opening | 7/6/2009 | 7/11/2009 | $500 | Gloworm | Nobs |
Marketing Program Starts | 6/6/2009 | 7/1/2009 | $1,000 | Glower | Marketeers |
Plan vs. Actual Review | 11/1/2009 | 11/8/2009 | $0 | Galore | Alles |
First Break-even Month | 3/5/2010 | 4/4/2010 | $0 | Bouys | Salers |
Hire Employees | 2/1/2010 | 3/3/2010 | $150 | Gulls | HRM |
Upgrade Business Plan Pro | 4/22/2010 | 4/24/2010 | $100 | Brass | Bossies |
Totals | $2,360 |
We are a small company owned and operated by Tim and Molly Jones, husband and wife, as a Subchapter S corporation.
Tim Jones – President Tim will be the main salesperson. He will also be responsible for shipping and receiving, inventory management, and the marketing and promotion of products. Tim will assist with record keeping and cost containment.
Molly Jones – Corporate Secretary Molly will maintain the company records and be in direct communication with the accountant and other advisors. She will also be in charge of the computer system and perform all of the desktop publishing for the company. She will assist as needed with sales, shipping and receiving, and customer service related issues. In addition to her regular duties, Molly will be doing Internet marketing from her office at Southeast Racing Parts. We anticipate that 20 hours every week will be dedicated to this marketing. The revenue that will be generated by this is reflected in the Sales Forecast.
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.
Tim and Molly not only have the desire to succeed, but will bring a wealth of knowledge and experience to the Southeast Racing Parts team. They have nearly thirty years of combined experience in the racing industry and have both performed nearly all facets of daily operations for a racing business. Following is a synopsis of their abilities and accomplishments:
Tim Jones (40) – President (background omitted to protect confidentiality)
Molly Jones (29) – Corporate Secretary (background omitted to protect confidentiality)
We depend on professionals, particularly our CPA, for some key management help. We have retained a local CPA to help us with financial and business management questions since we don’t have a strong background in those areas. Also, we are short on experience concerning human resource issues; however, we plan on utilizing our network of business associates to advise us when the need arises.
The cornerstone of the personnel plan is to maximize productivity and minimize the labor burden on the company’s operating expenses. As we grow, we expect to see steady increases in our personnel to match the increases in sales.
Personnel Plan | |||
Year 1 | Year 2 | Year 3 | |
Tim Jones | $16,800 | $20,160 | $24,192 |
Molly Jones | $9,600 | $11,520 | $13,824 |
Salesperson (PT) | $0 | $8,000 | $8,000 |
Salesperson (FT) | $0 | $0 | $20,000 |
Total People | 2 | 3 | 4 |
Total Payroll | $26,400 | $39,680 | $66,016 |
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 | |||||||||||||
Inventory Sales | 0% | $16,000 | $20,800 | $24,960 | $22,464 | $20,217 | $23,250 | $26,737 | $32,084 | $38,501 | $46,202 | $41,581 | $37,423 |
Internet Marketing | 0% | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 |
Total Sales | $17,400 | $22,200 | $26,360 | $23,864 | $21,617 | $24,650 | $28,137 | $33,484 | $39,901 | $47,602 | $42,981 | $38,823 | |
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 | |
Inventory | $11,200 | $14,560 | $17,472 | $15,725 | $14,152 | $16,275 | $18,716 | $22,459 | $26,951 | $32,341 | $29,107 | $26,196 | |
Internet Marketing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Direct Cost of Sales | $11,200 | $14,560 | $17,472 | $15,725 | $14,152 | $16,275 | $18,716 | $22,459 | $26,951 | $32,341 | $29,107 | $26,196 |
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 | ||
Tim Jones | 0% | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 | $1,400 |
Molly Jones | 0% | $800 | $800 | $800 | $800 | $800 | $800 | $800 | $800 | $800 | $800 | $800 | $800 |
Salesperson (PT) | 0% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Salesperson (FT) | 0% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total People | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 2 | |
Total Payroll | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 |
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 | $17,400 | $22,200 | $26,360 | $23,864 | $21,617 | $24,650 | $28,137 | $33,484 | $39,901 | $47,602 | $42,981 | $38,823 | |
Direct Cost of Sales | $11,200 | $14,560 | $17,472 | $15,725 | $14,152 | $16,275 | $18,716 | $22,459 | $26,951 | $32,341 | $29,107 | $26,196 | |
Other Costs of Sales | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Cost of Sales | $11,200 | $14,560 | $17,472 | $15,725 | $14,152 | $16,275 | $18,716 | $22,459 | $26,951 | $32,341 | $29,107 | $26,196 | |
Gross Margin | $6,200 | $7,640 | $8,888 | $8,139 | $7,465 | $8,375 | $9,421 | $11,025 | $12,950 | $15,261 | $13,874 | $12,627 | |
Gross Margin % | 35.63% | 34.41% | 33.72% | 34.11% | 34.53% | 33.98% | 33.48% | 32.93% | 32.46% | 32.06% | 32.28% | 32.52% | |
Expenses | |||||||||||||
Payroll | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | |
Marketing/Promotion | $150 | $150 | $150 | $150 | $150 | $150 | $150 | $150 | $150 | $150 | $150 | $150 | |
Depreciation | $345 | $345 | $345 | $345 | $345 | $345 | $345 | $345 | $345 | $345 | $345 | $345 | |
Vehicle Expense | $150 | $150 | $150 | $125 | $125 | $125 | $125 | $150 | $150 | $150 | $150 | $150 | |
Credit Card Surcharge | $160 | $208 | $249 | $224 | $202 | $232 | $267 | $320 | $385 | $462 | $415 | $374 | |
Inbound Freight Charges | $224 | $350 | $350 | $314 | $284 | $326 | $374 | $450 | $540 | $646 | $582 | $524 | |
Office Supplies | $50 | $50 | $50 | $50 | $50 | $50 | $50 | $50 | $50 | $50 | $50 | $50 | |
Security/alarm | $30 | $30 | $30 | $30 | $30 | $30 | $30 | $30 | $30 | $30 | $30 | $30 | |
Telephone | $150 | $156 | $187 | $168 | $150 | $174 | $200 | $240 | $288 | $346 | $311 | $280 | |
Accounting Costs | $125 | $125 | $125 | $125 | $125 | $125 | $125 | $125 | $125 | $125 | $125 | $125 | |
Rent | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | |
Utilities | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | |
Insurance | $70 | $70 | $70 | $70 | $70 | $70 | $70 | $70 | $70 | $70 | $70 | $70 | |
Payroll Taxes | 15% | $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 | |
Total Operating Expenses | $5,454 | $5,634 | $5,706 | $5,601 | $5,531 | $5,627 | $5,736 | $5,930 | $6,133 | $6,374 | $6,228 | $6,098 | |
Profit Before Interest and Taxes | $746 | $2,006 | $3,182 | $2,538 | $1,934 | $2,748 | $3,685 | $5,095 | $6,817 | $8,887 | $7,646 | $6,529 | |
EBITDA | $1,091 | $2,351 | $3,527 | $2,883 | $2,279 | $3,093 | $4,030 | $5,440 | $7,162 | $9,232 | $7,991 | $6,874 | |
Interest Expense | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Taxes Incurred | $224 | $602 | $955 | $761 | $580 | $824 | $1,106 | $1,529 | $2,045 | $2,666 | $2,294 | $1,959 | |
Net Profit | $522 | $1,404 | $2,227 | $1,777 | $1,354 | $1,924 | $2,580 | $3,567 | $4,772 | $6,221 | $5,352 | $4,570 | |
Net Profit/Sales | 3.00% | 6.33% | 8.45% | 7.44% | 6.26% | 7.80% | 9.17% | 10.65% | 11.96% | 13.07% | 12.45% | 11.77% |
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 | $17,400 | $22,200 | $26,360 | $23,864 | $21,617 | $24,650 | $28,137 | $33,484 | $39,901 | $47,602 | $42,981 | $38,823 | |
Subtotal Cash from Operations | $17,400 | $22,200 | $26,360 | $23,864 | $21,617 | $24,650 | $28,137 | $33,484 | $39,901 | $47,602 | $42,981 | $38,823 | |
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 | $17,400 | $22,200 | $26,360 | $23,864 | $21,617 | $24,650 | $28,137 | $33,484 | $39,901 | $47,602 | $42,981 | $38,823 | |
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 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | $2,200 | |
Bill Payments | $2,104 | $3,151 | $4,120 | $16,602 | $17,566 | $16,206 | $22,623 | $25,891 | $31,691 | $37,767 | $44,324 | $31,426 | |
Subtotal Spent on Operations | $4,304 | $5,351 | $6,320 | $18,802 | $19,766 | $18,406 | $24,823 | $28,091 | $33,891 | $39,967 | $46,524 | $33,626 | |
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 | $0 | $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 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Dividends | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Spent | $4,304 | $5,351 | $6,320 | $18,802 | $19,766 | $18,406 | $24,823 | $28,091 | $33,891 | $39,967 | $46,524 | $33,626 | |
Net Cash Flow | $13,096 | $16,849 | $20,040 | $5,062 | $1,851 | $6,244 | $3,314 | $5,393 | $6,010 | $7,635 | ($3,543) | $5,197 | |
Cash Balance | $14,096 | $30,944 | $50,984 | $56,046 | $57,897 | $64,141 | $67,456 | $72,849 | $78,859 | $86,494 | $82,952 | $88,149 |
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 | $1,000 | $14,096 | $30,944 | $50,984 | $56,046 | $57,897 | $64,141 | $67,456 | $72,849 | $78,859 | $86,494 | $82,952 | $88,149 |
Inventory | $50,000 | $38,800 | $24,240 | $19,219 | $17,298 | $15,567 | $17,903 | $20,588 | $24,705 | $29,646 | $35,575 | $32,018 | $28,816 |
Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Current Assets | $51,000 | $52,896 | $55,184 | $70,203 | $73,344 | $73,464 | $82,044 | $88,043 | $97,554 | $108,505 | $122,070 | $114,969 | $116,965 |
Long-term Assets | |||||||||||||
Long-term Assets | $29,000 | $29,000 | $29,000 | $29,000 | $29,000 | $29,000 | $29,000 | $29,000 | $29,000 | $29,000 | $29,000 | $29,000 | $29,000 |
Accumulated Depreciation | $0 | $345 | $690 | $1,035 | $1,380 | $1,725 | $2,070 | $2,415 | $2,760 | $3,105 | $3,450 | $3,795 | $4,140 |
Total Long-term Assets | $29,000 | $28,655 | $28,310 | $27,965 | $27,620 | $27,275 | $26,930 | $26,585 | $26,240 | $25,895 | $25,550 | $25,205 | $24,860 |
Total Assets | $80,000 | $81,551 | $83,494 | $98,168 | $100,964 | $100,739 | $108,974 | $114,628 | $123,794 | $134,400 | $147,620 | $140,174 | $141,825 |
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 | $2,000 | $3,028 | $3,568 | $16,015 | $17,033 | $15,455 | $21,766 | $24,841 | $30,440 | $36,274 | $43,273 | $30,476 | $27,555 |
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 | $2,000 | $3,028 | $3,568 | $16,015 | $17,033 | $15,455 | $21,766 | $24,841 | $30,440 | $36,274 | $43,273 | $30,476 | $27,555 |
Long-term Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Liabilities | $2,000 | $3,028 | $3,568 | $16,015 | $17,033 | $15,455 | $21,766 | $24,841 | $30,440 | $36,274 | $43,273 | $30,476 | $27,555 |
Paid-in Capital | $80,625 | $80,625 | $80,625 | $80,625 | $80,625 | $80,625 | $80,625 | $80,625 | $80,625 | $80,625 | $80,625 | $80,625 | $80,625 |
Retained Earnings | ($2,625) | ($2,625) | ($2,625) | ($2,625) | ($2,625) | ($2,625) | ($2,625) | ($2,625) | ($2,625) | ($2,625) | ($2,625) | ($2,625) | ($2,625) |
Earnings | $0 | $522 | $1,926 | $4,154 | $5,930 | $7,284 | $9,208 | $11,787 | $15,354 | $20,126 | $26,347 | $31,699 | $36,269 |
Total Capital | $78,000 | $78,522 | $79,926 | $82,154 | $83,930 | $85,284 | $87,208 | $89,787 | $93,354 | $98,126 | $104,347 | $109,699 | $114,269 |
Total Liabilities and Capital | $80,000 | $81,551 | $83,494 | $98,168 | $100,964 | $100,739 | $108,974 | $114,628 | $123,794 | $134,400 | $147,620 | $140,174 | $141,825 |
Net Worth | $78,000 | $78,522 | $79,926 | $82,154 | $83,930 | $85,284 | $87,208 | $89,787 | $93,354 | $98,126 | $104,347 | $109,699 | $114,269 |
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Published Sep.23, 2013
Updated Sep.15, 2024
By: Cynthia Turner
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Table of Content
Are you looking to learn how to open auto part store? The business can be a great investment if you have a basic understanding of different kinds of automobiles and their part requirements. Starting an auto parts business is relatively simpler as it doesn’t require abundant resources.
The business management side is also relatively easy as you can start it on a small scale. There isn’t a need to have a huge team or a large shop to start up the business initially. This can significantly benefit you if you are new to management and business.
You can also easily draft up an ecommerce startup business plan for your business. As a guide you can look at related plans such as convenience store business plan . For a better reference, you can take help from this automobile parts business plan.
2.1 the business.
Best Rev will be an auto parts store owned by Sheldon Cooper in Manhattan. The primary aim of the business will be to reduce the hassle of vehicle owners by providing them best condition spare parts for their automobiles. The business will offer a wide range of services and products for the ease of its customers.
If you are just learning how to start an auto parts business , the best advice you will find is to establish strong management. You can have good management through adequate planning. And there is no better way to plan out every aspect of your store than through an auto parts store business plan pdf like the one presented here.
You can also take aid from relevant business plans like used auto parts business plan or an auto dealership business plan .
In this business plan motor parts shop example, we will guide you about all the components of a strong business plan. Of course, you can alternatively also hire business plan experts to do this work for you.
The customers of Best Rev will belong to all classes, and work domains as vehicles have become a fundamental part of life for a majority of the world’s population. The recurring customers of the business will be:
The main aim of Best Rev is to become a reliable and trustworthy source of good auto parts and maintenance services among its customers.
The financial targets that the business wants to achieve within the first five years are mentioned below:
3.1 company owner.
Best Rev will be owned and operated by Sheldon Cooper. Sheldon completed his Bachelors in Mechanical Engineering two years ago, after which he pursued an engineering position in a noteworthy motor company. However, six months ago, he left the post to fulfill his lifelong passion of starting his own automobile parts and maintenance store.
Sheldon noticed that Manhattan experiences a lot of traffic, but there are no auto shops or parts stores located in the area or anywhere in the 15-mile radius. Here, he saw the opportunity to cater to vehicle owners of Manhattan and the nearby regions. The result was Best Rev, an auto parts store that deals with the maintenance and repair of vehicles and the provision of spare parts.
Step1: Plan Everything
Good planning is the most crucial step when learning how to start a car parts business. The best aid in planning and managing a business is its business plan. To write your vehicle spare parts business plan, you can take help from this automobile spare parts business plan. Best Rev is an automobile spare parts shop, for which the business plan is detailed here. You can take help from this example or go through other examples like used car dealership business plan to get an idea of what to include when planning for a start-up.
Step2: Define the Brand
What comes next is to highlight your business and its unique propositions. This can be achieved by creating a brand around your business idea. This will include everything from the principles it follows to its unique value above its competitors. This will introduce a good image of your business to your customers and also help you create a space for yourself in the market.
Step3: Establish Your Corporate Office
The next step is to manage the physical aspect of the business. Sheldon decided to rent out two back-to-back small shops in the main Manhattan commercial area. He decided that one of these shops would be the face of the business where all dealing will customers will take place. All the spare parts will also be stored in this area. In contrast, the other shop will be used to maintain and repair vehicles.
Step4: Establish a Web Presence
Establishing a web presence is integral in today’s market. Therefore, Sheldon decided to develop a website for the business and social media presences for marketing.
Step5: Promote and Market
The final step is to develop a good marketing plan and stick to it.
Legal | $134,400 |
Consultants | $0 |
Insurance | $22,200 |
Rent | $36,600 |
Research and Development | $10,000 |
Expensed Equipment | $52,200 |
Signs | $3,400 |
Start-up Assets | $222,400 |
Cash Required | $209,000 |
Start-up Inventory | $39,000 |
Other Current Assets | $222,000 |
Long-term Assets | $287,000 |
Start-up Expenses to Fund | $258,800 |
Start-up Assets to Fund | $979,400 |
Assets | |
Non-cash Assets from Start-up | $1,240,800 |
Cash Requirements from Start-up | $122,000 |
Additional Cash Raised | $50,000 |
Cash Balance on Starting Date | $35,000 |
Liabilities and Capital | |
Liabilities | $18,200 |
Current Borrowing | $0 |
Long-term Liabilities | $0 |
Accounts Payable (Outstanding Bills) | $58,000 |
Other Current Liabilities (interest-free) | $0 |
Capital | |
Planned Investment | $1,238,200 |
Investor 1 | $0 |
Investor 2 | $0 |
Other | $0 |
Additional Investment Requirement | $0 |
Loss at Start-up (Start-up Expenses) | $133,400 |
Before you start an auto part business, you need to decide on your business’s services to your customers. You may have many auto parts business ideas, but you can’t implement everything in the business initially. Therefore, you have to pick and choose what you will start with.
You can follow this guide on how to start an auto parts business to figure out what the market for the business looks like and what services are ideal to be included in your start-up.
The series of steps to follow can be confusing when learning how to become an auto parts distributor. Therefore, we have described everything here in detail. Since Sheldon started with a variety of services, this format can be used to develop even a flower shop business plan .
Best Rev will sell spare parts for all kinds of automobiles as its base service. As a result, most of the auto parts in demand will be readily available, while there will also be an option for customers to order the parts custom to their vehicle.
In addition to providing spare parts, Best Rev will also offer maintenance services to its customers. This will include
The customers of Best Rev can also bring their vehicles to the store to get any part fixed. In addition, the business will have mechanics available at all times who will deal with any problems a vehicle might have.
Our last service will be the cleaning service. Our customers can bring their vehicles and get them serviced and cleaned in just 20-40 minutes, depending on vehicle type.
When starting an auto parts business, you should have an excellent understanding of your target market. You can gain this understanding by doing an extensive market analysis as a part of your automobile spare parts business plan pdf. This analysis should look into the past, present, and future market trends for you to make the best choices.
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Your automobile parts business plan should also analyze the price of similar services in the market. This data should be used to forecast the prices you will set for your own products and services.
If you don’t know what to include in your motor vehicle spare parts business plan, then you can take help from the document here. Also, if you are having difficulty conducting a marketing analysis, you can look at the marketing plan of this business plan motor parts shop.
According to IBISWorld, the auto parts industry holds a market size of $66 Billion in the United States, employing almost 400 thousand people. The industry is continuously in demand as more and more people adopt automotive vehicles in their life. So, opening a business in this industry is a very smart move as the demand will only get bigger.
The potential customers of Best Rev will be as follows:
5.2.1 personal vehicle owners.
The primary customers of Best Rev will be people who own cars for personal use. As a majority of the population of Manhattan owns cars, our business will expect these customers to be quite regular. They are expected to avail maintenance and cleaning services most often.
Our second target customer will be private dealerships looking to fix up cars and sell them. We will provide them with the spare parts and maintenance services required.
Due to the vast amounts of construction being carried out in Manhattan and surrounding areas, we expect our third most frequent customers to be cargo vehicle businesses looking for spare parts, maintenance, and cleaning services.
Our final customer group will be professional racers. They are expected to avail our spare parts and maintenance services, although not that often.
Personal Vehicle Owners | 39% | 59,900 | 71,880 | 86,256 | 103,507 | 124,209 | 10.00% |
Private Dealerships | 37% | 45,800 | 54,960 | 65,952 | 79,142 | 94,971 | 10.00% |
Cargo Vehicle Businesses | 14% | 22,700 | 27,240 | 32,688 | 39,226 | 47,071 | 10.00% |
Professional Racers | 10% | 22,300 | 26,760 | 32,112 | 38,534 | 46,241 | 11.00% |
10% |
Our prices will be economical compared to our competitors since they won’t pay extra shipping fees for spare parts.
To gain attention in the market among your competitors, you need to highlight your competitive advantages. This is crucial in developing a business, especially an online auto parts business.
You can market what makes you unique in the industry through a solid marketing plan. A market plan will not only allow you to bring light to your strongest features, but it will also help you in learning how to become an auto parts distributor in a saturated market.
So, if you want to develop a strong marketing strategy for your business, you can take help from this motor parts business plan pdf. You can also look at other business plans such as skateboard store business plan to understand how to build a marketing strategy.
Unit Sales | |||
Spare Parts | 8,200 | 8,692 | 9,214 |
Maintenance | 4,550 | 4,823 | 5,112 |
Repair Service | 1,450 | 1,537 | 1,629 |
Cleaning Service | 1,550 | 1,643 | 1,742 |
Unit Prices | Year 1 | Year 2 | Year 3 |
Spare Parts | $60.00 | $69.60 | $80.74 |
Maintenance | $75.00 | $87.00 | $100.92 |
Repair Service | $350.00 | $406.00 | $470.96 |
Cleaning Service | $150.00 | $174.00 | $201.84 |
Sales | |||
Direct Unit Costs | Year 1 | Year 2 | Year 3 |
Spare Parts | $20.00 | $22.00 | $23.10 |
Maintenance | $15.00 | $16.50 | $17.33 |
Repair Service | $100.00 | $110.00 | $115.50 |
Cleaning Service | $80.00 | $88.00 | $92.40 |
Direct Cost of Sales | |||
There are a lot of auto parts stores in the world. But only those are popular that make customers happy and satisfied. The success of a business, especially in the automobile industry, depends not only on the quality of parts but also on the customer support staff.
Understanding this importance, Sheldon included some essential features as a part of employee hiring criteria in the automobile spare parts business plan. He also formed a list of employees necessary for running his business. This list can be seen in this auto parts store business plan sample.
Manager | $45,000 | $49,500 | $54,450 |
Receptionist | $30,000 | $33,000 | $36,300 |
Cleaners | $92,000 | $101,200 | $111,320 |
Mechanics | $123,000 | $135,300 | $148,830 |
Social Media Manager | $23,500 | $25,850 | $28,435 |
Web Developer | $22,500 | $24,750 | $27,225 |
You can’t ensure the success of an automobile parts business through just sales. You need to ensure that all the resources are efficiently managed so that your business doesn’t go into a loss.
You can prevent your business from losing resources by developing a financial plan as a part of your motor spare parts business plan. This will include the costs associated with your business’s essential aspects, such as an auto parts franchise cost. In addition, it will analyze where you are spending your money and how you are earning to keep everything in balance.
Here, we are describing the details of the financial plan of Best Rev.
You can also look at a business plan for e-commerce to get a good idea of managing business finances.
Plan Month | 1 | 2 | 3 |
Current Interest Rate | 8.12% | 8.20% | 8.26% |
Long-term Interest Rate | 8.40% | 8.44% | 8.47% |
Tax Rate | 24.03% | 24.21% | 24.60% |
Other | 0 | 0 | 0 |
Monthly Units Break-even | 5340 |
Monthly Revenue Break-even | $132,500 |
Assumptions: | |
Average Per-Unit Revenue | $231.00 |
Average Per-Unit Variable Cost | $0.62 |
Estimated Monthly Fixed Cost | $163,800 |
Other | $0 | $0 | $0 |
TOTAL COST OF SALES | |||
Expenses | |||
Payroll | $336,000 | $369,600 | $406,560 |
Sales and Marketing and Other Expenses | $145,000 | $148,000 | $156,000 |
Depreciation | $2,300 | $2,350 | $2,500 |
Leased Equipment | $0 | $0 | $0 |
Utilities | $2,900 | $3,000 | $3,100 |
Insurance | $2,100 | $2,100 | $2,100 |
Rent | $2,900 | $3,000 | $3,200 |
Payroll Taxes | $24,000 | $25,000 | $27,000 |
Other | $0 | $0 | $0 |
Profit Before Interest and Taxes | $556,800 | $796,961 | $1,127,661 |
EBITDA | $556,800 | $796,961 | $1,127,661 |
Interest Expense | $0 | $0 | $0 |
Taxes Incurred | $111,360 | $159,392 | $225,532 |
Net Profit | $445,440 | $637,569 | $902,129 |
Net Profit/Sales | 28.31% | 32.96% | 37.93% |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $51,000 | $55,080 | $59,486 |
Cash from Receivables | $22,000 | $23,760 | $25,661 |
SUBTOTAL CASH FROM OPERATIONS | |||
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 | |||
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $42,000 | $42,000 | $45,000 |
Bill Payments | $27,000 | $28,000 | $31,000 |
SUBTOTAL SPENT ON OPERATIONS | |||
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 | $0 | $0 | $0 |
Purchase Other Current Assets | $0 | $0 | $0 |
Purchase Long-term Assets | $0 | $0 | $0 |
Dividends | $0 | $0 | $0 |
SUBTOTAL CASH SPENT | |||
Net Cash Flow | $21,000 | $23,000 | $25,000 |
Cash Balance | $27,000 | $30,000 | $33,000 |
Assets | |||
Current Assets | |||
Cash | $275,000 | $308,000 | $338,800 |
Accounts Receivable | $24,000 | $26,880 | $30,213 |
Inventory | $4,300 | $4,816 | $4,900 |
Other Current Assets | $1,000 | $1,000 | $1,000 |
TOTAL CURRENT ASSETS | |||
Long-term Assets | |||
Long-term Assets | $10,000 | $10,000 | $10,000 |
Accumulated Depreciation | $19,400 | $21,728 | $24,444 |
TOTAL LONG-TERM ASSETS | |||
TOTAL ASSETS | |||
Liabilities and Capital | Year 4 | Year 5 | Year 6 |
Current Liabilities | |||
Accounts Payable | $18,700 | $20,944 | $23,541 |
Current Borrowing | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 |
SUBTOTAL CURRENT LIABILITIES | |||
Long-term Liabilities | $0 | $0 | $0 |
TOTAL LIABILITIES | |||
Paid-in Capital | $30,000 | $30,000 | $31,000 |
Retained Earnings | $53,000 | $57,770 | $63,547 |
Earnings | $193,400 | $210,806 | $231,887 |
TOTAL CAPITAL | |||
TOTAL LIABILITIES AND CAPITAL | |||
Net Worth | $293,400 | $319,806 | $351,787 |
Sales Growth | 7.25% | 8.03% | 8.90% | 3.00% |
Percent of Total Assets | ||||
Accounts Receivable | 9.21% | 10.20% | 11.31% | 9.80% |
Inventory | 5.39% | 5.97% | 6.62% | 9.90% |
Other Current Assets | 2.11% | 2.34% | 2.59% | 2.40% |
Total Current Assets | 149.80% | 151.00% | 152.00% | 158.00% |
Long-term Assets | 11.55% | 11.60% | 11.64% | 12.00% |
TOTAL ASSETS | ||||
Current Liabilities | 4.90% | 4.94% | 4.98% | 4.34% |
Long-term Liabilities | 0.00% | 0.00% | 0.00% | 0.00% |
Total Liabilities | 7.59% | 7.65% | 7.72% | 7.38% |
NET WORTH | ||||
Percent of Sales | ||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 94.60% | 97.15% | 99.87% | 99.00% |
Selling, General & Administrative Expenses | 93.56% | 96.09% | 98.78% | 97.80% |
Advertising Expenses | 1.52% | 1.56% | 1.60% | 1.40% |
Profit Before Interest and Taxes | 41.50% | 42.62% | 43.81% | 33.90% |
Main Ratios | ||||
Current | 34 | 35 | 36 | 32 |
Quick | 33 | 33.8 | 34.645 | 33 |
Total Debt to Total Assets | 0.18% | 0.18% | 0.17% | 0.40% |
Pre-tax Return on Net Worth | 74.08% | 74.89% | 75.00% | 75.00% |
Pre-tax Return on Assets | 96.30% | 101.12% | 106.17% | 111.30% |
Additional Ratios | Year 1 | Year 2 | Year 3 | |
Net Profit Margin | 33.56% | 34.60% | 35.67% | N.A. |
Return on Equity | 55.80% | 57.53% | 59.31% | N.A. |
Activity Ratios | ||||
Accounts Receivable Turnover | 7.7 | 7.8 | 7.8 | N.A. |
Collection Days | 100 | 100 | 100 | N.A. |
Inventory Turnover | 32.4 | 34.02 | 35 | N.A. |
Accounts Payable Turnover | 15.6 | 16 | 16.3 | N.A. |
Payment Days | 27 | 27 | 27 | N.A. |
Total Asset Turnover | 2.5 | 2.5 | 2.6 | N.A. |
Debt Ratios | ||||
Debt to Net Worth | -0.04 | -0.03 | -0.04 | N.A. |
Current Liab. to Liab. | 1 | 1 | 1 | N.A. |
Liquidity Ratios | ||||
Net Working Capital | $244,000 | $257,664 | $272,093 | N.A. |
Interest Coverage | 0 | 0 | 0 | N.A. |
Additional Ratios | ||||
Assets to Sales | 0.85 | 0.87 | 0.89 | N.A. |
Current Debt/Total Assets | 1% | 0% | 0% | N.A. |
Acid Test | 29 | 29.12 | 29.16 | N.A. |
Sales/Net Worth | 2.1 | 2.2 | 2.2 | N.A. |
Dividend Payout | 0 | 0 | 0 | N.A. |
1. How to start an auto parts store?
You can start an auto parts store by developing a good auto parts store business plan.
2. How to open an auto parts store?
For starting an auto parts store, you will need to rent or buy a physical space and create management plans.
3. How to start an online auto parts business?
To start an online auto parts business, you will need to manage your business finances and develop a strong marketing plan. Furthermore, you will need to establish social media presence as well.
Download Auto Parts Store Business Plan Sample in pdf
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Starting an auto parts business may seem daunting, but with the right planning, you can open a successful shop. Our #1 Auto Parts Business Plan Template & Guidebook provides guidance for entrepreneurs looking to create a sustainable and profitable enterprise. This comprehensive guide is designed to help you make informed decisions about launching your own business and take advantage of the many opportunities the auto parts market has to offer.
Get worry-free services and support to launch your business starting at $0 plus state fees.
1. describe the purpose of your auto parts business..
The first step to writing your business plan is to describe the purpose of your auto parts 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 auto parts business:
Our mission at ABC Auto Parts is to be the leading provider of quality, affordable automotive parts and services in the region by providing exceptional customer service and top of the line products. We strive to create a trustworthy and welcoming atmosphere for our customers and employees alike, while providing knowledgeable guidance throughout the experience.
The next step is to outline your products and services for your auto parts 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 auto parts 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 auto parts 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 auto parts 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 auto parts business varies based on many different variables, but below are a few different types of startup costs for a auto parts 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 auto parts 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 auto parts 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 auto parts business plan:
Why do you need a business plan for a auto parts business.
A business plan is an essential tool for any business, including an auto parts business. It helps to provide a roadmap and direction, enabling you to plan your short-term and long-term goals, identify potential risks and opportunities, define how you will finance the venture, and track progress as you launch and grow your business. A business plan also helps to ensure that all relevant stakeholders are informed of the venture’s details and structure.
You should consider reaching out to a business consultant or a financial advisor for help with your auto parts business plan. They can provide you with tailored advice and resources to ensure that your plan is comprehensive and effective. Additionally, if you are able to join an auto parts trade association, they may be able to provide additional support.
Writing a business plan for an auto parts business is a complex process that requires research and dedication. It is best to consult with an experienced business plan writer who can provide expertise and guidance to make sure all aspects of the plan are covered. An experienced business planwriter can provide an effective outline for the plan and help with key areas such as market analysis, competitive advantage, financial projections, and more.
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.
Spare Parts Business Plan Sample PDF Example | Free Download Presented by BizMove
Checklist for Starting a Spare Parts Business: Essential Ingredients for Success
If you are thinking about going into business, it is imperative that you watch this video first! it will take you by the hand and walk you through each and every phase of starting a business. It features all the essential aspects you must consider BEFORE you start a Spare Parts business. This will allow you to predict problems before they happen and keep you from losing your shirt on dog business ideas. Ignore it at your own peril!
For more insightful videos visit our Small Business and Management Skills YouTube Chanel .
Free book for you: how to start a business from scratch (pdf).
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Never feel that your questions are too small to ask your lawyer. A reliable lawyer will have no problem giving you any information you need and will update you whenever you ask. If you don't get answers that you're looking for when working with a lawyer, it may be time to consider hiring another one.
A good tip to remember if you're going to be working with a lawyer in a criminal case is to be completely honest. By law, anything that you say to your lawyer has to remain confidential. Telling the truth will also give your lawyer the best shot at winning your case.
A good tip to keep in mind if you're thinking about working with a lawyer is to give them as much information as you can. The more documents and information they have that pertains to a case, the better your chances are of winning. If you think a document might be worthless, you lawyer might think otherwise.
Keep a paper trail. Document all conversations and meetings with your lawyer. Take note of all questions asked, as well as their answers and record all arrangements and discussions of fees and charges. Lawyers are only human and make mistakes. Give yourself a layer of protection with excessive record keeping.
Know just exactly how much opportunity cost you are giving up when choosing to go to court. Any case takes time, and just how much time depends a lot on the ability of your lawyer. If you choose a young lawyer to save money, you may find that the case takes many more weeks than if you had gone with someone more seasoned. Those weeks can be many hours of lost pay! Do your homework here and make sure the math works out for your choices.
If your lawyer has a busy schedule, your case may end up costing more to complete. That's because it will end up dragging on as they tend to all of their other clients. Try to select a lawyer who isn't running around like a chicken with their head cut off!
Most lawyers will agree to meet with you for free so you can explain your problem and get some useful advice. You should plan on meeting with different lawyers to get several professional opinions and compare fees. Spend a few weeks meeting with different lawyers before you decide to hire one.
Don't hire the first lawyer that you meet. You should meet with a number of lawyers to get an idea of how they operate. This is the only way that you will find one you are comfortable with. Don't ever settle for a lawyer that doesn't make you feel comfortable or you'll regret it.
Ask your lawyer about their education. It is not the only thing you should wonder about, but it is an important factor. A better school means that they had to work harder for their law degree. There are good lawyers that did not go to the best schools, but this information may still be useful.
Be patient. If you need a lawyer, you are likely to be a ball of nerves. Don't let that rush you into choosing the first lawyer you run into. Take your time and do the research that will lead you to someone who is the best for your case and your pocketbook.
You will never find a lawyer who is selling you positive results. If you do, they're lying. You need to look for a lawyer who doesn't stay in the office day and night as this is truly a guarantee that they know what they're doing and will do a great job.
If you need a specialized lawyer, ask the lawyers you are considering about their specialized training. There are seminars and additional classes lawyers can take to learn more about a specific issue. For instance, lawyers who are qualified to help you with filing for bankruptcy should be members of the National Association of Consumer Bankruptcy Attorneys.
A good tip to keep in mind when thinking about hiring a lawyer is to write down several questions that you wish to ask him or her. You want to find out what their philosophy is and so on, and asking questions will help give you a clear idea about them.
A good tip to remember if you're thinking about hiring a lawyer is to take your time and make your search thorough. You shouldn't impulsively hire a lawyer just because you need one right away. There are so many lawyers out there, that you need to be selective to get the best one for you.
A good tip if you're thinking about hiring a lawyer is to listen to your gut when it comes down to whether or not you're going to hire that person. Your lawyer is going to represent you in court, so if your lawyer seems unscrupulous, it's going to fall back on you.
When looking for a good lawyer, make sure to obtain personal references. Talking to the local community that has experienced issues similar to yours. For instance, if you're a victim of sexual harassment, speak with a women's group. Ask them about the lawyers they had and what their experiences were like.
Don't sign up to work with a lawyer when you don't feel very comfortable with them. This goes for the fee arrangement, too. Avoid signing a check that is blank for a lawyer. Ask for a quote right away and go over the fee structure in details.
The Majority of us are acquainted with the old riddle that goes:"If a tree Falls in the forest, and no one is in the region to hear it, does it make a sound?" From a communication point of view, the answer must be a certain"No." Though there are sound waves, there is no sound because no one perceives it. For communication to happen, there must be a sender and a receiver. This chapter is focused on the recipient - the person who provides feedback to the sender, the intention is to help you Improve Listening Skills. The Objective to Improve Listening Skills takes us to that which Saul Gellerman said: "The sender, to be certain that his message is going to be approved by the recipient, must be ready to let the receiver sway him. He should even be prepared to allow the receiver change or modify the message in a way which make it more acceptable to the recipient. Otherwise, it may not be understood or it may not be accepted, or it may simply be given lip service and discounted." This places the responsibility for good communications squarely on the Shoulders of both the sender and the recipient. Every one of us plays the roles of sender and recipient several times every day. Therefore, it is very important to learn how to play each role nicely. Researchers have found that the average individual spends much more Time every day in listening than in speaking, writing, or reading. Therefore, Improve listening skills listening is a very important communicative task. Were you aware we devote roughly 40 to 45% of our working hours to listening? And were you aware that, if you haven't taken steps to improve this ability, you listen in only 25 percent efficiency? Placing these ideas together, do you feel comfortable knowing you earn 40 percent or more of your cover whilst listening at 25% efficiency? If not, maybe acting on the information imparted in this chapter can enhance your listening skills to over the average in listening efficiency. Tests have demonstrated that we can considerably raise the amount of our listening performance by a small amount of research and practice. The Significance of the listening ability to managers was recognized by Industrial companies for some time. Dr. Earl Planty, in his role as executive counselor at Johnson and Johnson, has stated:"By far the most effective way by which executives can tap thoughts of subordinates is listening from the many daily everyday contacts inside and beyond the work area. There is no system which will do the job in a simpler manner. Nothing could equal a executive's willingness to listen" Recognizing the value of effective listening, many companies Provide training Programs to enhance this skill. Some years ago the Methods Engineering Council compared one group of participants in a preliminary discussion about efficacy in listening with another group not participating in such a discussion. The comparison was made by testing each group. The test results revealed the marks made from the first group were 15 percent greater - a substantial improvement. What Listening Is. We hear - often without listening - when sound waves Attack our eardrums. As soon as we don't recall what we have heard, it's most likely because we didn't listen. A good example is the situation that frequently occurs when we're introduced to a new worker or a new acquaintance. A couple of minutes later we can not remember the individual's name. Why? Since we probably failed to hear the name when we had been introduced. Johnson defines listening as"the ability to Comprehend and respond effectively to oral communication." Thus, we can state at the outset that hearing isn't listening. Listening requires more than hearing; it necessitates understanding the communication received. Davis says it this way:"Hearing is with the earsbut listening is with the brain'." Some of the attributes of a Fantastic listener are as follows: '' He generally makes Better decisions because the inputs he receives will be better; He sees more in a predetermined period of time, thereby saving timeand He encourages other people to hear what he says because he appears more attentive and better mannered. The typical listener, after two weeks may recall just 25 percent of that which Has heard in a briefing or a language. Therefore, listening is not effective for receipt and preservation of factual particulars. For retention of factual details we must put our reliance on the written word. Researchers have discovered that we can improve our listening comprehension Roughly 25 percent. Most of us process the sender's voice so quickly that there's idle time for us to think about the message whenever it is being given. During this idle period a good listener ponders the sender's goals, weighs the evidence being presented, and searches for ways to understand the message. It follows that fantastic listening can be considered"a conscious, positive action requiring willpower" The ability to listen more effectively may be acquired through Discipline and practice. As a gamer you ought to physically and mentally Prepare yourself for the communication. You Have to Be physically relaxed and Mentally alert to receive and comprehend the message. Effective listening Requires continuing concentration (regardless of the period of the material ), Attention to the key ideas presented, note-taking (if the conditions are Appropriate), and no psychological blocks into the message by the listener. You Cannot listen passively and hope to keep the message. If You Would like to be an Effective listener, you need to provide the communicator of the message adequate Focus and make an effort to understand his perspective.
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Posted by StartupBiz Zimbabwe | Jan 7, 2018 | Business Ideas , Business Plans , Retail Industry , Starting a Business | 6
Car ownership has increased significantly in Zimbabwe. A lot of individuals are purchasing new cars everyday (mostly second hand) and others have existing vehicles which also need maintenance. Imagine such a huge market which needs servicing and maintenance and how much opening a car auto parts business will make you a very successful entrepreneur. Operating an auto spare parts business in Zimbabwe is very profitable.
The auto parts industry is resilient and although Zimbabwe is going through an economic downturn, this industry enjoys good profits. Before you start a motor spares shop business in Zimbabwe, you have to decide on the size of your business, location of business, products to offer and your target market. You should always carry out a feasibility study, market research and write a business plan before you venture into any business. Do not make the mistake of starting an auto parts shop business or any other business just because someone is doing it and he/she says it’s profitable. This article will explain how to start an auto parts shop business in Zimbabwe, and the auto parts shop business plan.
What you need
Location will influence the viability of your auto parts business. The best place to start a motor spares shop business is where there are many people with cars eg it would not make much business sense to start an auto parts business in the rural areas as there are few people with cars. It is however important to ascertain that you’re choosing a market that has enough purchasing power. Assess the number of auto parts retailers in your prospective area. Investigate the size of your target market and their income patterns. Use quality marketing and advertising strategies. People can always come and find you because of the quality service and the type of parts you provide. You will need premises which include the auto parts shop, back offices, and a warehouse for your products.
You need to conduct market research and come up with a market entry strategy that will keep you viable. Identify your competition and understand how they do business, what their marketing strategy is and the amount of market influence they have. Most auto parts businesses are operated locally, only a few operate as a national chain. Most importantly identify the niche that you want to cater for. This will help you in formulating your marketing strategy.
You have to make a decision on what kind of products you will sell in your auto spare parts shop. There are several vehicle brands, so you can either concentrate on 1 type of brand e.g. your auto parts shop can sell only Toyota spare parts. Alternatively, you can sell spare parts of different brands e.g. Toyota, Nissan, BMW, Ford e.t.c.
There are many different types of auto parts you can sell. The motor spare products you can offer in your shop include
You need to know exactly where you will get your auto parts supplies and your pricing strategy. Choose a niche you can work in and that is profitable. The products which you choose to offer in your auto spare parts shop will depend on your target market and the amount of capital you have. You will be sourcing the products from local and international suppliers.
Some Auto Parts Shop Products
If you are to succeed you need to manage your inventory properly. Satisfy all your customer needs and make sure that they find all of the supplies they require.The demand is steady over time such it is better if you keep your store fully stocked all the time. You therefore need a good supplier who delivers the right quality and on time. At startup, it may be hard to stock your store with all the auto parts you need. However you can cash in fast if you focus on providing parts that are highly demanded. Profits will keep rolling in if you a wide auto parts selection for your customers.
Cash can be very difficult to manage in your auto parts business. When it comes to cash flow management, you cannot take chances. Account for all your cash inflows and out flows. In the first few months you may need to put back all the revenue you get back into the business to increase your supplies and grow the business. Costs for the motor spare parts business include salaries of employees, rent, inventory, shipping costs, electricity and water, taxes, insurance and advertising costs.
Depending on the size of your store, the number of your sales staff and cashiers will vary. You will need employees who understand auto parts and also the technical aspects involved. Employees who have a background in the repairs and maintenance of vehicles can do the job even much better. Good management is a determining factor in the success of the business.
Zimbabwe was in a recession from 2000-2008, and then the economy recovered in 2009 when the local Zimbabwean currency was dropped in favour of the United States Dollar. This led to a period of economic growth, which resulted in more disposable income for Zimbabweans. Thus the number of Japanese vehicles imported by Zimbabweans increased rapidly. This created a large customer base for motor spares products.
It is important that you establish a reliable customer base who will give you repeat business. Repeat business is possible . Try hook your customers by offering repeat discounts. Your loyal customers can also subscribe for a loyalty card and get bonus points which they earn every time they purchase from your store. It will be good if you secure large customers as you will be guaranteed of repeat business. Potential customers for your auto parts shop include short term insurance companies, panel beating and spray painting companies, garages, transport companies, mechanics and individuals.
For an in-depth analysis of the motor spares shop business in Zimbabwe, purchase our business plan. We decided to introduce the business plans after noting that many Zimbabweans were venturing into the auto parts store business without a full understanding of the industry, market, how to run the business, the risks involved, profitability of the business and the costs involved, leading to a high failure rate of their businesses.
Our business plan will make it easier for you to launch and run a auto spares business successfully, fully knowing what you are going into, and what’s needed to succeed in the business. It will be easier to plan and budget as the auto parts business plan will lay out all the costs involved in setting up and running the business. The business plan is designed uniquely for the Zimbabwean market.
You have been such a wonderful help.God bless you,I have somewhere to start now….it’s been a dream come true to embark on this
The StartupBiz business plans are excellent, well prepared, fully detailed. I had not that much of the financial knowledge of the Agri business I wanted to venture into but I can tell you right now that from the moment I went through those farm business plans I had purchased, I started having the real picture of what I was to get in to,what was needed for me to be financially successful and I would want to tell my fellow mates that if you really want the business you want to venture into to be successful I think you need to get one of the StartupBiz Business plan.You wont go wrong with those ones
Very insightful and relevant homegrown solutions. Empowerment begins in the mind and this is it…
You have been really helpful. Its a rare commodity in Zimbabwe. Keep it up!
I have been impressed with the level of depth and completeness of your business plans. All product, operational, financial and marketing guidelines are there. Fantastic! Please do add more plans.
Thanks for the business plan, it’s good, it gives me a good direction of my journey, with this I hope I will prosper, it’s helpful i learnt a lot.
Good job and extensive research on your business plan thank you.
The business plan I purchased was well written and you did an extensive research, I am satisfied keep up the good work guys and I am planning to come back for more other orders.
I recently used their service am delighted to say I am a happy customer thank you keep it up and God bless with the business
It is a great opportunity having you around. Your business plans are well planned after a thorough research. They have actually opened up my approach to business. Thanx
The auto spare parts store business plan can be used for many purposes including:
The business plan includes, but not limited to:
The auto spare parts business plan package consist of 4 files
The business plan financials are in USD currency.
The financial statements are automated. This implies that you can change eg value of stock bought, markup etc, and all the other financial statements will automatically adjust to reflect the change.
We decided to make them affordable for anyone who would want a business plan, and the price for pre-written business plans is only US$10 for soft copies.
You can purchase via Paynow (Ecocash/Innbucks/One Money/MasterCard/Visa Card) or via Paypal. You just click Buy Now (scroll down) and you will then be taken to payment website where you make the payment. Just follow the instructions; you will be done with the payment process in 2 minutes. We will email the business plan (PDF format, Microsoft word format, and a Microsoft Excel file with the financial statements) to you within 24 hours, using the email address you provided when you were paying.
You can also purchase soft copies at our offices in Harare. Visit StartupBiz Zimbabwe, Suite 201, 2nd Floor, Morgan House, George Silundika Avenue (between 1st Street & 2nd Street), Harare . The cost of the business plan is US$10 (soft copies).
For any questions, other payment options, email us on [email protected] , call/whatsapp us on +263778798072 (Whatsapp us by clicking the link https://wa.me/263778798072 ) .
Click Buy now to purchase using Ecocash, Innbucks, Paypal, MasterCard or VisaCard (US$10)
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We wish you the best in your auto spare parts shop business. Check out more business ideas and our collection of business plans . Like us on Facebook , follow us on Twitter , and subscribe to receive notifications of new posts in your email.
A note from StartupBiz Zimbabwe: Everyday we send business updates via Whatsapp. Click the link to join: https://chat.whatsapp.com/KTPPiZpsPPS6laELHIaJ0R or send the word join via Whatsapp to +263778798072 (Whatsapp us by clicking the link https://wa.me/263778798072 ).
StartupBiz Zimbabwe is a business research firm based in Zimbabwe. We sell prewritten business plans for various industries including agriculture, transport, manufacturing, retail and education. StartupBiz Zimbabwe also publishes articles on business ideas, business news, business tips, personal finance, entrepreneur interviews and profiles.
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Thank you for the feedback Tanaka
This is awesome
Keep the good work up. This is excellent
good day, may you kindly assist with contacts of people who provide good motor spares for resell. thank you for the excellent ideas….
Nice ideas l like you
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Posted by BizBolts | All Articles , Business Ideas , Business Plans , Retail Industry
An auto spare parts store business in South Africa is very lucrative and profitable. Car ownership is increasing significantly in South Africa every year. A lot of South Africans are purchasing new and used cars everyday, and others have existing vehicles which also need to be maintained. There are over 12 million registered cars in South Africa, this is according to data from National Administration Traffic Information System (eNatis). Every year, more than 400 000 new vehicles are sold in South Africa. This is according to data from the National Association of Automobile Manufacturers of South Africa (Naamsa). This creates a huge demand for motor spares. Consider how large a market there is that requires servicing and maintenance, and how much starting a car auto parts business will make you a very successful entrepreneur in South Africa. Every automobile requires frequent part changes during its entire lifespan so setting up such a business can be profitable. This article will outline how to start a motor spares business in South Africa, and the auto spare parts store business plan – PDF, Word and Excel.
It’s important that you carry out market research before you start the motor spares business. Important decisions to make include deciding on the location of your business, the products you will offer, your target market and the size of your business. Understand your target market, and what kind of products they want. Identify and study your competition. Assess the competition at your proposed location. Through carefully studying your competition and customer trends you will find a gap in the market and also find ways to offer better services. You need all the information you can get to formulate a great customer experience model that won’t be easily contested. You should also have a good motor spares business plan before you venture into this business.
When researching the market, you must segment it based on your potential customers’ demographics. It is important to get first-hand information about the market’s conditions and the opportunities in your area. After determining your target market, the next step would be to outline the products you will offer your customers. Researching your market will also help you know who your competition is, and it will enable you to figure out ways to develop strategies that work. In addition, by researching the market, you can find out what the popular spare parts brands are in the local market. This will help you find out more about the different models of bikes, motor vehicles, and other heavy-duty vehicles that have a high population density in your area. It is important to note that market research is done on a regular basis. The information you get from conducting this research will help you make more informed decisions about your existing operations and activities. You can set competitive prices, find affordable distribution channels, and identify gaps in the auto parts market.
Location is a big factor in determining the success of your auto spare parts business. You should locate your auto parts store business in a place where there are many people with cars. It would be unwise to locate your motor spares store business in a rural area which has few car owners. There are several possible locations: shopping centres & malls, industrial areas, urban areas and in the CBD. People can always come to your motor spares store because of the quality service and the type of parts you provide.You will need premises which include the auto spares store, back offices, and a warehouse for your products. Your premises should have sufficient parking space for your customers. Your auto spares business plan should cater for the costs of renting or buying premises.
The kind of auto parts products to sell will depend on your target market and business strategy. There are different niches you can target. Some specialise with spares for one make eg Toyota spare parts. Others may choose to specialise in one product line eg cooling systems, suspension parts, braking system, gearboxes, engines etc. Some motor spare businesses in South Africa focus on quick replacement parts eg. high pressure pumps, brake pads, shocks and shoes. You can also sell a variety of products without specialising in anything. The products which you can sell in your auto spare parts store include Suspension parts, Body Parts, Ball Joints , Belts , Oil Pumps , Tyres, Fuel Pumps , Clutch Plates , Pressure Plates , Fenders , Bonnets , Radiators , Ignition Plugs , Seat Covers , Mountings, Bushes & Shock Pads , Filters , Bearings, Discs & Hubs , Rubber Boots , Brake Pads & Brake Shoes , CV Joints, Shock Absorbers , Lubricants and Batteries. The products can be sourced from local suppliers and international suppliers.
Auto Spare Products
The automotive components sector takes up a significant share of the total production capacity in the South African manufacturing industry. The auto spare parts sector is a highly diversified industry with engine and auto component manufacturers, aftermarket parts manufacturers, a number of dealers, suppliers, and various retailers. In order to build a successful auto spare parts business, you need to stand out from your competition, and this requires knowledge of who your competitors are and what they offer. A competitive analysis will help you with this information. A competitive analysis is a study of your competitors’ products, services, as well as sales tactics. With a competitive analysis, you can evaluate your competitors’ strengths and weaknesses. It is important to note that a conducting a competitive analysis should be done regularly. This is because it will help you see your own strengths and any potential barriers to growth that you may encounter. A competitive analysis will also keep your business proactive instead of reactive. Many businesses operate based on preconceived ideas regarding their competitors and market landscape, but those ideas may not be true or may be obsolete. When conducting a competitive analysis, you should study your direct and indirect competitors. Find out who their clients are, what the pricing is like, and how they promote their business.
The number of employees you need will depend on the size of your auto spares store business. The is need for finance/accounting personnel who will be responsible for all the day to day transaction accounting for the motor spares store business. This will include the tracking of all transactions and the management of cash flow, and ensuring there are enough funds available to meet the day to day payments.
Operations & logistics personnel are responsible for coordinating with suppliers and sourcing all the products which will be sold in the auto parts store, and arranging delivery of sold products to customers. They are also responsible for inventory control, ensuring that the shop has all the products in stock and in the right quantities, and determining when to place new orders. You also require cashiers and shop assistants. Your auto spare parts store business plan should cater for the salaries of your employees.
Knowledgeable staff members will add value to your team by helping the customers buy the correct products. There is a wide range of products available at motor spares shops, customers often get confused. Anyone can easily find themselves making small blunders by buying the wrong product. If you have inexperienced staff members on your team their training program should focus more on learning about the different products sold in the store so they are able to give informed advice to customers.
You should account for all the business cash inflows and cash outflows. Ensure that you have a good inventory management system, so that you don’t run out of products which are needed by clients. When starting your motor spares business, it maybe difficult to stock your store with all products because of limited capital. You can start with quick moving products, and ensure that you reinvest all the money into the business. With time, you will be able to stock a variety of products in your auto spares store. Profits will keep rolling into the business if you offer products which are needed by your target market.
A marketing plan is one of the most important business tools your business can have. A marketing plan is usually the missing link between the strategic direction of your motor spare parts business and the delivery of results. There are a number of activities or ideas you can consider when creating your auto spare parts marketing plan. One of them is sharing some tips and information on social media to attract new customers. You can even hold a car show where people can gather and watch you in action. The exposure will pay off since shows connect with local enthusiasts, and the buzz will attract new clients. You can also contribute parts and/or funds to a project vehicle to gain some more exposure. Consider collaborating with an automotive company for similar promotions. Somewhere, there may be another company trying to reach the same market that your company is trying to reach. Another important factor to consider in your marketing plan are customer reviews. Do not underestimate the power of consumer reviews because these testimonials are incredibly influential. Studies have shown that customers will consider reviews first before making a purchase, especially if they haven’t done business with the company before. It is important to develop a marketing plan if you want your business to grow. Think of a marketing plan as the engine that drives your sales.
There is a huge market for auto parts products in South Africa due to the increasing car ownership. Potential customers for your motor spares business include individuals, companies, organisations, transport companies, p anel beating and spray painting companies, insurance companies, garages, mechanics and auto repair companies. It’s wise to establish a customer base which gives you repeat business. If you offer quality products at good prices, customers will always come back to your motor spares store. Build customer loyalty by giving discounts to your regular customers. Give quality service. Advertising is also required to attract more people to your auto spare parts store, thus boosting sales. Advertising can be via word of mouth, flyers & brochures, online advertising, social media marketing, print media, and sponsoring the community amongst other ways.
For an in-depth analysis of the motor spares store business in South Africa, purchase our auto spare parts store business plan. We decided to introduce the business plans after noting that many South Africans were venturing into the auto parts store business without a full understanding of the industry, market, how to run the business, the risks involved, profitability of the business and the costs involved, leading to a high failure rate of their businesses.
Our business plan will make it easier for you to launch and run a auto parts business successfully, fully knowing what you are going into, and what’s needed to succeed in the business. It will be easier to plan and budget as the motor spares business plan will lay out all the costs involved in setting up and running the motor spares business. The business plan is designed specifically for the South African market.
The motor spares store business plan can be used for many purposes including:
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The Auto Spare Parts Store Business Plan package consist of 4 files
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Rev your business engine with SmatBiz’s Auto Spare Parts Business Plan. Secure funding, impress investors and conquer the South African market with ready-made plans for any scale. Downloadable PDFs, Word & Excel docs included. SEDA compliant & tailored for local success. Let’s drive!
Ready to dominate the thriving South African auto spare parts market? Shift into high gear with SmatBiz’s comprehensive Auto Spare Parts Business Plan. Whether you’re a start-up or scaling up, our pre-written plans provide the roadmap to success.
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Pre-Written Auto Spare Parts Store Business Plan (PDF, Word And Excel): Comprehensive Version, Short Funding/Bank Loan Version and Automated Financial Statements. For an in-depth analysis of the auto spare parts store business, we encourage you to purchase our well-researched and comprehensive auto spare parts store business plan. We introduced ...
The financial plan overview should succinctly summarize your financial goals and projections, including revenue targets and profit margins, to provide a clear picture of your store's financial trajectory. Example: Precision Auto Parts aims for $4.5 million in annual revenue by 2028, targeting a 10% EBITDA margin.
Get the most out of your business plan example. Follow these tips to quickly develop a working business plan from this sample. 1. Don't worry about finding an exact match. We have over 550 sample business plan templates. So, make sure the plan is a close match, but don't get hung up on the details. Your business is unique and will differ from ...
Below are the sales projections for Freeway Auto Parts Stores®, LLC it is based on the location of our business and other factors as it relates to auto parts retail stores start - ups in the United States; First Fiscal Year-: $250,000. Second Fiscal Year-: $450,000. Third Fiscal Year-: $750,000.
4. Location and Space. After getting the plan properly, you must secure a retail location according to your business model. Choose a location that is easily accessible to your target customers and suppliers. Also, set up a spacious and organized warehouse to store and manage your spare parts inventory. 5.
Executive Summary. Southeast Racing Parts (SRP) is a small, North Carolina-based automobile racing parts brick and mortar and mail order organization. SRP will remain small in order to offer unprecedented customer attention. Southeast Racing Parts will become the premier destination for entry level and novice racing parts.
The business plan of the auto spare part business aims to maximize profit margins and ensure that the business achieves its goals and objectives. In essence, the main source of income is the retailing of a wide range of auto spare parts at attractive prices. This includes selling automotive parts and accessories including critical parts ...
3.3 How the Auto Parts Store will be started. Step1: Plan Everything. Good planning is the most crucial step when learning how to start a car parts business. The best aid in planning and managing a business is its business plan. To write your vehicle spare parts business plan, you can take help from this automobile spare parts business plan.
How to Write a Auto Parts Business Plan in 7 Steps: 1. Describe the Purpose of Your Auto Parts Business. The first step to writing your business plan is to describe the purpose of your auto parts business. This includes describing why you are starting this type of business, and what problems it will solve for customers.
This is a practical manual in a PDF format, that will walk you step by step through all the essential phases of starting your Spare Parts business. The book is packed with guides, worksheets and checklists. These strategies are absolutely crucial to your business' success yet are simple and easy to apply. Copy the following link to your browser ...
In our auto repair shop business plan template products and services section, we cover: Maintenance: a maintenance package available for new or used cars including oil change and repairs. Spare parts: sale of parts and tires with a guaranteed 48 hour delivery for parts which are out of stock.
Get the Auto Parts Business Plan (PDF, Word And Excel) We decided to make them affordable for anyone who would want a business plan, and the price for pre-written business plans is only US$10 for soft copies. You can purchase via Paynow (Ecocash/Innbucks/One Money/MasterCard/Visa Card) or via Paypal.
PRE-WRITTEN AUTO SPARE PARTS STORE BUSINESS PLAN (PDF, WORD AND EXCEL): COMPREHENSIVE VERSION, SHORT FUNDING/BANK LOAN VERSION AND AUTOMATED FINANCIAL STATEMENTS. For an in-depth analysis of the motor spares store business in South Africa, purchase our auto spare parts store business plan. We decided to introduce the business plans after noting ...
Auto Spare Parts Business Plan - Download. Rev your business engine with SmatBiz's Auto Spare Parts Business Plan. Secure funding, impress investors and conquer the South African market with ready-made plans for any scale. Downloadable PDFs, Word & Excel docs included. SEDA compliant & tailored for local success. Let's drive!
business, and the auto spare parts business plan - PDF, Word and Excel. MARKET RESEARCH The Need To Gather Comprehensive Up-To-Date Data. Market research for auto spare parts business is basically 3-tier i. market identification, product research, and consumer research. You can conduct market research by conducting surveys, observations ...