BUSINESS PLAN

Prepared by Raphael Tanaka Trish Robert

Company name: SUB~ZERO MOTORS

Type of business:MOTOR VIHECLE REPAIRS

,PANEL BEATING,SPRAY

PAINTING,AUTO ELECTRICS

,SPARES CAR SALES AND SALES.

MANAGEMENT TEAM AND CONTACT DETAILS

Rapheal 0782656691

Robert 0776405105

Tanaka 0775326476

Trish 0774515320

SUB~ZERO MOTORS

CONTENTS TABLE1. EXECUTIVE SUMMARY 1.1 Main aim and objectives 1.2 Brief description of the business1.3 Brief description of the business1.4 Overview of the market1.5 Financial requirements 2. COMPANY DESCRIPITON 2.1. Ownership2.2. Start of plan2.3. Services2.4. Reasons2.5. Assets currently owned2.6. Benefits to the owner2.7. Benefits to the society3. SERVICES ANALYSIS 3.1. Service facilities3.2. Equipment3.3. Office location3.4. Wage structure4. MARKET ANALYSIS 4.1. Market forecast4.2. Main competitions4.3. Industry analysis4.4. Keys to success4.5. Distrubution pattern5. SALES AND MARKETING STRATEGY 5.1. Market strategy5.2. Pricing strategy5.3. Customer distrubution network5.4. Sales strategy5.5. Sales forecast5.6. Services

SUB~ZERO MOTORS

6. ORGANISATION

6.1. Organisational structure

6.2. Management team and responsibility

6.3. Social and environmental impact assessment

6.4. Sales

7. FINANCIAL

7.1. Budget assumption

7.2. Proforma operating statements

7.3. Expenditure

7.4. Break even analysis

8. RISK EVALUATION

8.1. Various elements of risk

8.2. Mitigation of the elements

9. CONCLUSION 9.1. Strength and strategies9.2. Weakness and strageties9.3. Opportunities and strategies9.4. Threats and strategies

SUB~ZERO MOTORS

1 EXECUTIVE SUMMARY1.1. MAIN AIM

The Major aim of this business is to generate income for the members giving people`s vehicles a new lease of life.This venture aims to give hope to the hopeless by fixing their vehicles,be it accident damaged or with faults and purchasing second hand cars.it also aims providing vehicles to the to the low income persons at very affordable prices and favourable terms as well as to back up spares of vehicles,tractors etc

1.2. COMPANY DETAILS

Address :SUB~ZERO MOTORS

:10 GLASSGLOW

:MUTARE

Contact Numbers :cell-0773889209

Tel :(020)689251

E-mail subzero@gmail.com

SUB~ZERO MOTORS

1.3.BRIEF DESCRIPITION OF THE BUSINESS

SUB~ZERO MOTORS is a garage that was founded on 01 january 2016 by five members in Mutare. The purpose of the enterprise is to generate income by serving the community by providing by providing brand new and purchasing second cars at affordable prices,spares,panel beating and mechanical repairs on cars. The venture needs $20 000 to run but only $10 000 has been rasised through contributions from members.The organization therefore applies for $10 000 cash loan facility.

1.3.1. LOCALITY

● To be locally available providing the best

Services even vehicle delivery service

after services will have been provided.

1.3.2. GROWTH

●To flourish the business in an alarming rate that is manageable and being outstanding in the

market with innovative ideas.

1.3.3. PROFIT

●To produce sufficient and reliable profit to plough back to the business for its survival,plough

back to the community support owner`s objectives.

1.3.4. OBJECTIVES

● To purchase accident damaged cars,fix and resale.

●To purchase cars with mechanical or electrical faults, fix ,and resale at affordable

prices.

SUB~ZERO MOTORS

● To rent out cars for special occasions like weddings etc.

● To repair accident damaged cars and broken down vehicles for individuals and

companies.

● To create jobs for unemployed youths and women empowerment in the local

community this will subsequently reduce loitering,drug & alcohol abuse and other anti-

social activities.

● To research and disseminate the latest information on automobiles to other garages and

service centers.

●To sell cars to low income earners at reasonable and manageable terms of payment.

1.3.5 SHORT TERM OBJECTIVE

●To start business with at least 2 accident damaged cars,3 cars with mechanical faults

then repair them for resale with minimum debt.

1.3.6LONG TERM OBJECTIVES

●To grow into a bigger recognized organization,expand abroad and manage to penetrate

into the foreign market.

1.4 OVERVIEW OF THE MARKET FOR MY SERVICES

A number of market research surveys have been undertaken indicating that a greater

percentage of people commute to work and from point A to point B because they cannot

afford to buy cars because most car sales offer cash and carry and no payment terms.

Most people can no longer afford to take their cars to garages after being involved in an

accident or if a vehicle has developed mechanical faults because of the high rates charged SUB~ZERO MOTORS

these garages do not have back up spares of vehicles on the market.Research has also

proved that most of the garages do not have car hire services for functions like

weddings,funerals,parties,etc.

1.5 FINANCIAL REQUIREMENTS

The company needs at least $15 000 to start running.

1.6. USES OF MONEY

● Rentals for premises

● Stationery for receipts,posters,flyers for adverts,business,quotation books,checklist

books,delivery notes,order books,etc.

● equipment like diagnostic machines,compressors,porto power,car-o-liner bodyline up

systems,tool boxes,grinders,spray guns,aero-cure spray booth,car lift posts,etc.

● Purchases cars with mechanical faults and accident damaged cars for a start.

● Wages and salaries.

2.0 COMPANY DESCRIPITION

2.1 OWNERSHIP

Robert Maumba AS DIRECTOR

Trish Waretsa AS THE CEO

NehmiaMapandaAS THE OPERATIONS MANAGER

Tanaka AS THE TREASURER

RaphealMavhulele AS THE SUPERVISOR

SUB~ZERO MOTORS

SUB~ZERO MOTORS

2.2 START UP PLAN

To start up a business with $20 000 where 50% of this will be from the owners own savings.

DATE TIME ACTIVITY BYJAN 7 2016 0800hrs Acquiring a loan from

CBZManager

JAN 15 2016 0900hrs Searching around for equipment,cars and spares for resale

Treasurer and Manager

JAN 16 2016 0800hrs Purchasing of equipment,cars and spares

Treasurer

JAN 17 2016 0745hrs Cleaning up of a new site and installation

Staff (maintenance)

JAN 18 2016 0745hrs Staff Staff

JAN 19 2016 0745hrs Business commences Staff members

SUB~ZERO MOTORS

2.3 SERVICE

● Service will be conducted in a friendly manner to clients with provision of care and trust from a business lasting band.Most civil servants and many formally employed people would aquire cars at a debt payable at a specified and agreed period.People`s vehicles would be repaired at 0% deposit on labour and would pay at a given period.Customers will only pay cash on spares.

2.4 ASSETS CURRENTLY OWNED

●Pool trucks.

●1 Computer.

●5 Mobile phones.

●1 arc welding machine

●Tools box.

●breakdown recovery truck.

2.5 REASONS FOR BUSINESS PLAN

● To be used by revenue authorities in the application of a license.

●To outline goals of the business.

●For security loans from banks.

● To acquire a shop license from responsible authorities.

● A guideline of full operation of the business.

SUB~ZERO MOTORS

2.6 REASONS FOR THE INTREST IN THE BUSINESS

We are doi business studies at Mutare Teachers’ College Practising High School now have knowledge in the business of procurement and supplying and we have realized that sourcing of vehicles at low prices because cars are a necessity in peoples lifes.Most car sales are not being able to meet the terms and conditions which are affordable to the people.To supply all kinds cars but which are easy to repair and maintain.To create employment for the youth in the community of Mutare.

2.6 BENEFITS OF THE OWNERS

● Profit

●Status in the society

● Loss shared

2.7 BENEFITS TO THE SOCIETY

● Reduced unemployment rate.

●Reduces the country`s dependency syndrome since most people now depend on buying cars on the internet because of cheap prices.

●Creates balance in trade.Donations to the less privileged to improve their lives.

●Lessened transport problems.

3 SERVICE ANALYSIS

3.1 SERVICE FACILITIES

A reception will be available,two private offices and one pool office will be available.Most of the space will be covered with a workshop and parking area for vehicles displayed for sale.At the reception that is where most of the payments will be done and enquries.All office work will be done in the pool office and all negotiations, big and special orders will be done in either of the two private offices where the active directors will be found.

SUB~ZERO MOTORS

3.2 WORKSHOP AND OFFICE LOCATION

The workshop and offices will be located in the industrial area of Mutare where there is more space for the workshop and the noise does not affect many.Some mobile offices will be in town for people who would like to like hire,book some vehicles and purchase cars and spares.

3.3 WAGES STRUCTURE

Minimum wages will be set by the National Employment Council and the company will add its incentive to motivate its workers and monthly wages will like:

Manger $1 247

Secretary $568

Treasurer $895

Supervisor $745

Workshop foreman $500

General workers $420

4 MARKET ANALYSIS

4.1 INDUSTRY ANALYSIS

Most organizations have gone miles in providing substandard and expensive services beyond the reach of the majority.However there is great room for SUB~ZERO MOTORS to go beyond all existing motor garages be outstanding due to its unique style of services conducted.

4.2 DISTRIBUTION PATTERNS

Our targeted clients are working class people including all the people in the community who constitute about three quarters of our buyers.To other individuals all transactions will be cash upfront but the rates will also be reasonably low. The distribution of cars will change with time since the company will have purchased many faulty cars fixed them and put them on market.Some cars will be supplied to small entrepreneurs outside Mutare to other parts of Manicaland.

SUB~ZERO MOTORS

4.3 MAIN COMPETITORS,THEIR STRENGTH AND WEAKNESS

Competitor Strength WeaknessSupreme panel Beaters They have been in the field for

so long and they also own their own premises so less rentals for them.

Reduced pace of growth since they see themselves the giants in the market.

Quest Motors Have dominated a large fraction of the market.

Expensive products and services.

4.4 KEYS TO SUCCESS

4.4.1 LOCATION

● Our target market is Mutare province and other provinces surrounding Mutare.

●Our main premises will be located in the industrial sites of Mutare targeting cars from all surrounding Mutare and across the border from Mozambique.

4.4.2 GOOD PUBLIC RELATIONS

●Create a good name for the organization.

●Allows us to get views and ideas from customers from all sectors and even our competitors since in business you are not enemies but you work together.

● Commitment,self confidence and creativity leads to the success of SUB~ZERO MOTORS.

4.5 MARKET FORECAST

SUB~ZERO MOTORS

5 SALES AND MARKETING STRATEGY

5.1 MARKETING STRATEGY

●Advertising through all found media.

●Offering free services like;free quotations,free breakdown recovery services in town with a radius of 40km provided job is brought to workshop,20 000km guarantee on all engine overhauls provided all service all intervals are done at the garage in the time,one month free carwash once a day on all cars sold or repaired by the product support team,24hr breakdown recovery services.

5.2 PRICING STRATEGY

●The business will adopt market skimming as the initial pricing method.

●Pricing will be finalized after after calculating all expenses, time taken to complete the job nature of customer and terms of payment.

●Prices will be lower than those found on the local market.

5.3 PROMOTIONS

● 10% discount on all cash payments.

●Vehicles purchased 2 days before any public holiday will be sold with tank of fuel.

5.4 SALES STRATEGY

● Will be based on demand .

● Demand will be activated by promotional activities and marketing.

5.5 SALES FORECAST

Sales will increase by using the method of penetrating into the market.We are confident enough that during the first 3 months we will offer the best services and solutions in town.The graphs will be shown as follows:

SUB~ZERO MOTORS

march april may 0

1

2

3

4

5

6

7

8

Series3Series22

5.6 SERVICES

Our mandate will be to create goodwill for the company which will facilitate the growth of the organization.Customers should should be allowed to give their views and comments concerning our services.Will try to handle our customers with care and pay more attention to their needs.

6 ORGANIZATION

SUB~ZERO MOTORS is a top to down company with all seniors having direct link in all seniors having direct link in all operations as in research and development.

● THE ORGANIZATIONAL STRUCTURE

All members are equal shareholders but duties are hierarcal according to seniority.

SUB~ZERO MOTORS

MANAGER

SECRETARY

TREASURER

SUPERVISOR

WORKSHOP FORMEN

SUB~ZERO MOTORS

GENERAL WORKERS

SUB~ZERO MOTORS

MANGEMENT TEAM AND RESPONSIBILITIES

MANAGER

●Oversees the overall function of the project with assistance from the secretary and treasurer.

SECRETARY

●Keeps upon all corresponding ,records and stores important information ,documents ,statistics and minutes.

TREASURER

● Records all financial records, deposits and withdraws money from the bank.

SUPERVISOR

● Attend to daily chores of the general workers or hired labor.

WORKSHOP FORMEN

●Attends to all responsibilities in the work shop.

●SOCIAL AND ENVIROMENTAL IMPACT ASSESMENT

The project does not pose a threat to humans, animals and all living creatures workshop will be located away from the CBD and residential area to avoid noise and air pollution that affect people.Recent machinery will be purchased that produce less pollutants will be disposed in waste bins not in rivers for it will kill fish and all water living organisms.This pollution will be minimized.The social and environment assessments were led by the EMA Enviromental Management Agency and NSSA for security of employees and the public.

● SALES

The organization expects to get an average of $25 000 per month from sales of at least 10 cars ,repairs of at least 40 cars and at least 5 car hires.If the loan is acquired the project exepects to earn a total of approximately $300 000 per year.

SUB~ZERO MOTORS

7 FINANCIAL

7.1 BUDGET ASSUMPTION

EXPENSES COST ($us)Puchasing of Equipment Premise

Working capitalPurchasing of damaged cars and broken down carsAdvertising and marketing promotionsMiscellaneous

$8 000

$ 500$ 5000

$3 000

$ 2000$ 500$ 900

Sub total $19 900

7.2 PROFORM A OPERATING STATEMENT

● Monthly Proforma invoices will be provided.

7.3 EXPENDITURE

The total estimated expenditure for the first year is $206 000.This amount is arrived at after adding monthly expenses ,hired labor ,allowances ,sundry expenses ,insurance ,loan repayment ,interest ,rentals ,stationery ,purchasing of cars and fixing for resale ,spares and other stock.

7.3.1. HIRED LABOR

A total estimated sum of $36 000 a year at $3 000 per month on hired labor such as drivers ,mobile sales reps.\

7.3.2 SUNDRY EXPENSES

Petty cash of $60 000 is allocated for sundry expenses for the year.

SUB~ZERO MOTORS

7.3.3 INSURANCE

A total amount of $24 000 has been budgeted for insurance for the to cover for most common risks like fire in workshop ,theft ,all cars in the garage ,accidents and other risks.

7.3.4 SPARES AND OTHER MATERIAL

A total amount of $26 000 has been budgeted for the purchase of spares ,other material like paints to fix cars for resale.

7.3.5 RENTALS

The organization estimates to use about $6 000 on rentals per year then about $8 000 on water bills and telephone bills per year.

7.3.6 LOAN REPAYMENT

The organization expects to pay back the loan completely in 12months of business.

7.3.8 NET CASH FLOW

A grand total $300 000 income cash flow is expected during the first.

7.4 BREAK EVEN ANALYSIS

It allows the organization to foresee into the future if some variables are changed.Its disadvantages are assumed variable and constant throughout and all services are done at a standard price.

8 RISK EVALUATION

● VARIOUS ELEMENTS OF RISKS

●Resistance from customers due to quality of services offered as compared to others already in business.

●Very stiff competition from the company`s rivals who are already established and have a substantial portion of the market.

●Most customers already go for other names ;they do business with other organizations that are already established.

SUB~ZERO MOTORS

●Management problems can also be considered as an element of risk since three quarters of the management team will new to this line of business.

8.2 MITIGAITON MEASURES TO OVERRIDE THE RISKS

Some measures have been employed to do away with possible elements of risk.these include;

●Intense advertising through pamphlets ,news papers,television ,radios and social networks such as face book.

●Producing quality products that are next to non.

●Employing qualified personnel from other well established organizations to employ skills they have attained from those recognized companies.

9 CONCLUSION

9.1.1 STRENGTH

●Provision of quality service.

●Recruitment of skilled personnel.

●Good relations with customers.

●Good communication skills with customers and the provision of exceptionally good customer care services.

STRATEGIES

●Always treat customers with respect and integrity as well as to exceed their expetions.

●Ability to utilize knowledge gained from short business management courses.

9.1.2 WEAKNESS

●Stiff competition from those already in business.

●Reliance on limited number of clients.

● Challenges in meeting demands because of less capital.

SUB~ZERO MOTORS

STRATEGIES

●Prepare detailed roasters to visit customers around the country marketing our products.

●Website displays to promote the products and services available for customers.

9.1.3 OPPORTUNITIES

●Due to our geographical location of close proximity to CBD ,great potential to success is high.

●Due to diversity in our range of services,it will be possible to explore new branches in previously seen as preffered target markets.

STRATEGIES

●Contact buyers of large companies in and outside Mutare to capture giant customers.

●Secure a place in the market and solidify business position before competition comes along.

9.1.4 THREATS

●Other organizations may copy or even improve our style of competition thereby stiffening the competition.

●Our venture may fail in the beginning.

STRATEGIES

●Build a strong and stable relationship with both suppliers and customers to ensure that they prefer our services.

●Flexibility ,credibility ,reliability and consistency.

SUB~ZERO MOTORS