Business Plan

Carpet fitting and sales business

Nottingham, UK

Jan 04, 2017

This document is confidential.

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 Executive Summary

Interior designers, homeowners and retailers use carpet to add warmth to their
spaces, making rich, attractive carpets always in demand. Opening up a carpet
showroom can be a successful business venture if you launch your business
after much planning. Find a space that showcases your carpets, and watch the
customers roll in.

Market Assessment & Strategic Implementation

1. Find a location suitable for your carpet showroom. Focus on a large, open
space. Long walls, where you can hang rolls of carpet or individual rugs, allow
you to display your merchandise well. Avoid a carpeted space -- you want
concrete, tiled or hardwood floors, which will allow you to draw customers'
attention to the carpets you have in stock.

2. Find your niche in the carpet industry. Who are your ideal customers? You
can sell carpet suitable for homes, office buildings or retail spaces. You can add
rugs to your collection to attract even more customers. Decide where you want
your business to fall within the carpet industry.

3. Establish relationships with carpet wholesalers. Ask a range of carpet

wholesalers for their rates. Don't just go for the lowest bidder. Consider the
experience you had with each wholesaler -- if the one with the lowest prices
was slow to respond or hard to reach, it might not be the company you want to
rely on to stock your carpet showroom. Find a balance of reasonable prices and
good customer service.

4. Network with other carpet retailers by joining an industry organization.

Organizations such as the Carpet Foundation and World Carpet and Rug
Council exist for those working in the industry. Membership in these
organizations allows you to bounce ideas off fellow carpet retailers and
promote your showroom at a national level.

5. Host a grand opening celebration once your carpet is in and your showroom
is ready to open. Send invitations out to local interior designers and real estate
agents, who can pass the information along to their clients. Offer discounts for
anyone who orders carpet during the event.

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Vision/Mission Statement

The vision is to achieve the best selling name in customers and is to gain their trust
and confidence in us. Our Carpet selling store will strive to become the leader in advanced
carpet selling stores with very economical rates..

Company Resources
Our selling store will Possess a well designed training program guaranteed to capture
intellectual candidates for the organization.
A large percentage of the public looking for economical carpets that best fits in their places,
with our dedicated employees and trained staff we will achieve this goal.
We will be offering our customers a professional residential and commercial carpets service,
primarily aimed at the upper levels of the market. We seek to fulfill the following benefits it
knows are significant to its customers.

1. Professionalism:
All employees are trained to display professionalism with every interaction with customers.

2. Convenience:
We will provide our services in the manner that is most convenient to the customer. This
includes arranging for visits even when the owner is not home at the time.

3. Trustworthiness:
Many consumers have valid concerns when it comes to fitting the carpet in their home. There
are apprehensive because of the possibility of theft and breakage. These concerns have
been eliminated or significantly reduced through our complete screening and training
process for employees. Additionally, Carpet Care has insurance specifically designed to
cover any loss that the customer may accredit to the company.

Major Constraints
 Labor-intensive industry.
 Usual time lag when having to build goodwill and confidence.
 Difficulty in establishing the company name due to being a start-up company.

Major Screening Criteria

Non- Financial Our Carpet Care will attempt to attain the highest level of customer
satisfaction. The service provided by the company will be greatly above all competitors. This
level of service is further accomplished by guaranteeing that the highest level of quality is
maintained at all levels. Our Carpet Care is dedicated to protecting its customers 100% from

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harmful chemicals any detrimental fumes. This dedication extends to the protection of the
environment.
Furthermore the company is extremely devoted to its employees. By maintaining superior
working conditions for all our employees we can develop top notch and dedicated team.

Financial The foremost financial goal of Carpet Care is to gain maximum market presence
over the first 5 years with market saturation within the following 5 years. As we reach
market saturation, sales will slowly but gradually increase. With the initial loan of
840,000 £ we expect to make 5.4m £ in profit per year for the first 5 years. Profit will
increase annually for the next 5 years and onwards. The initial loan will be paid back
within the first 5 years.

Financial Data/Projections

Expense Distribution

Initially, we calculated that approximately 840,000 £ was required to start operating the
business. This total includes offices/storage facilities, land, equipment, brand
development, fees, and graphic designing for our logos and marketing materials. The
costs are illustrated below.

 Office/Storage Facilities (500,000 £) - This is the biggest expense to build a

new warehouse with office space attached.

 Land (200,000 £) - The land where we will place our warehouse and office will
be located near the growing Nottingham area so we will have easy access to
freeways.

 Equipment (100,000 £) - The environmentally friendly equipment and

machinery installed and required in our service vehicles, as well as the vans
themselves.

 Fees (20,000 £) - Any legal fees other various fees that may be associated with
registering copyrights. This also contains other possible fees.

 Graphic Design (20,000 £) - We will be hiring designers to create a professional

image of Cheshire Carpet Care. This will in turn extend our exposure to a much
wider range of customers.

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 Operating
The yearly operating expenses to run Cheshire will initially total 900,000 £. This includes
staff, utilities, marketing, as well as loan repayments and interest. The expenses will vary
each year but will gradually drop.
A yearly estimate.

Year Staff Utilities Marketing Loan Repayment Interest Totals

1st Year 1208,000£

800,000£ 50,000£ 150,000£ 168,000 £ 40,000 £

2nd Year 800,000 45,000£ 150,000£ 168,000 £ 40,000 £

1203,000£
£

3rd
600,000£ 50,000£ 100,000£ 168,000 £ 30,000 £
Y 948,000£
e
ar

4th
350,000£ 45,000£ 100,000£ 168,000 £ 20,000 £
Y 683,000£
e
ar

5th Year 200,000£ 40,000£ 75,000£ 168,000 £ 10,000 £

493,000£

Gross Profit per Unit Sold

The gross profit Carpet Store will make for its service is based on the per room price x3
minus the development cost. Thus, the gross profit per 3 rooms sold is 150 £.

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Expected Market Share
We surveyed 100 heads of household and asked them whether they would use Our Carpet
Care, knowing the benefits and the price. Of those surveyed, 20% said they would use our
carpet store as it we will be readily available when they requested a purchase. 30% said they
might use our services, 25% said 95 £ per room was too pricey. The remaining 25% said
they fit their own carpets with their own machine. The illustration below will use a figure of
30% as the target market share for the first 5 years.

Expected Revenue
Based on the 5 year market share target there is an expected gain of an 8.5% market share
in the first year. This equates to 45,900 sales. With a 150 £ gross profit per 3 room services
sold, we can expect our first year gross profit will be 6.9 £ million. The target market
saturation is 30% over 5 years and then 40% over 10 years.

Risk Analysis
Carpet Store will employ a 24hr security system to secure company vehicles and warehouse.
Carpet Care also will have insurance on said equipment, vehicles and the warehouse if
something is stolen or ruined.
If a malfunction occurs within the machinery, it automatically shuts off to guarantee the safety
of employees. If an employee is working in the warehouse around possible hazards, it is
mandatory that they wear steel toed boots. In addition, they must wear safety glasses where
necessary.
Carpet Care will keep a record of deliveries and receipts in order to ensure that purchasing is
being performed correctly.

SWOT Analysis
Strengths
The Carpet Care is coming into the carpet purchasing and fitting industry as a competitor
with cutting edge technology. The company has a profound insight into the carpet business
due to the expertise of its management. We are dedicated to an eco-friendly business
practice and the welfare of our customer base. We use only the highest quality
biodegradable substances in our machines. Above all we provide superior customer service
to our clients.

Weaknesses
The company is relying on loans for the start-up and initial developing stage. There is often
difficulty breaking out into an established market and developing awareness and benefits
associated with our company. The machines and substances used in the cleaning process

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are more costly than normal carpet care. This cost will translate into a higher cost to the
customer.

Opportunities
There are countless opportunities for a company that uses no harsh chemicals for cleaning.
There are not many environmentally safe companies to compete against. Our organization is
the only company using this cutting edge technology in the valley. Therefore, we are
competing against a range of substitute carpet cleaning options.

Threats
The key threat is the potential competition from the companies already in the market. The
state of the economy may sway customers to go with a cheaper competitor or view this
service as a luxury.

SWOT ANALYSIS Matrix

STRENGTHS
 Cutting edge technology.
 Profound insight into the carpet business.
 Dedication to an eco-friendly business practice
 Focused on the welfare of customer base.
 Use of highest quality biodegradable substances.
 Superior customer service to clients.

WEAKNESSES
 Reliable on loans for start-up and initial developing stage.
 Difficulty breaking out into an established market.
 Developing awareness and benefits associated with the company.
 Machines and substances used in cleaning process are more costly than normal
carpet care.
 Translates to higher customer cost.
 Countless opportunities for companies using environmentally friendly supplies.
 Only company using this cutting edge technology in the valley.

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OPPORTUNITIES
 Potential competition from companies already in the market.
 State of the economy.
 Cheaper competitors.
 Service viewed as a luxury.

GANTT CHART:

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FLOOR PLAN:
The floor plan of the carpet store is shown below;

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Emergency Exit Plan:
The emergency exit plan is shown in the figure below;

CASH FLOW:
Owner Investment:

Currently, ACE CLEANERS owns the following assets valued at:

 2 computer systems (hard drive, monitor, mouse, keyboard) £ 1,000.00

 2 printers £ 300.00
 1 copy machine £ 350.00
 1 fax machine £ 95.00
 3 desks £ 200.00
 1 postage meter £ 50.00
 2 telephones £ 80.00
 1 office chair £ 130.00
 1 desk calculator £ 60.00
 1 filing cabinet £ 20.00
 1 safe £ 75.00
 1 shredder £ 180.00
 1 truck mounted machine £ 5,000.00
 2 floor buffers £ 1,000.00
 1 van £ 6,500.00
 1 high speed varnisher £ 2,500.00

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  Carpet Installing supplies inventory 1,600.00

 Subtotal Owner Investment… $19,140.00

Additional investments include;

 Used 1995 commercial van $1,500.00

Total Owner Investments… $20,640.00

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