By Joel Murray,2014-07-09 14:49
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    TH4358 W. 224 AVENUE WOOD CITY, CA 93XXX

    559-000-000 (T) 559-000-000 (F)


    Joe Smith

    Submitted To:

Wood City Community Bank

    2424 E. Cincinnati Blvd.

    Wood City, CA 93XXX








    Table 1- Population Growth6Table 2- Cost of Living6Exhibit 1- Competitive Analysis14Exhibit 2- Monthly Cost of Living - Joe Smith16Exhibit 3- One Year Cash Flow Projection17



    The purpose of this business plan is to support a request for a $50,000, five-year

    bank loan to purchase equipment and inventory as part of the financing for a start-up sole

    proprietorship, Joe’s Quality Painting. The business will be owned by Joe Smith and will

    thbe located at 4358 W. 224 Avenue, Wood City, CA 93XXX. The owner will provide a

    minimum of $25,000 in initial equity.

     The business will offer professional quality painting, stucco repair, sandblasting,

    drywall repair, textured coatings, waterblasting, and waterproofing for residential and

    commercial buildings. Based on the financial and competitive analysis presented in this

    plan, Joe’s Quality Painting will be successful. The cash flow projection, Exhibit 3, One-

    Year Cash Flow Projection, indicates break-even including owner’s draw of $28,080 for the first year of operations.

     It is anticipated that Joe’s Quality Painting will become well known in the Wood

    City area within two years and will become known throughout the Central Valley in five

    years. Joe’s Quality Painting’s distinctive logo, its reputation for quality service and only

    the highest quality products, plus its slogan, ―Joe’s Quality Painting—don’t settle for

    less!‖ will provide a distinctive competitive edge. The owner, Joe Smith, has founded two highly successful contractor businesses in the Wood City area. The owner holds an

    undergraduate business degree from the School of Entrepreneurship, California State

    University, Wood City.


    Business Description

    Joe’s Quality Painting will be a start-up painting contractor business serving the Wood City and surrounding areas. Initially, Joe’s Quality Painting will work out of

    thleased space at 4358 W. 224 Avenue. Joe’s Quality Painting plans to begin operations

    st on April 1of the year 20XX.

     Joe’s Quality Painting will be a sole proprietorship, owned by Joe Smith. Joe Smith has been in the residential and commercial painting business for approximately ten

    years. Additionally, Joe has first hand experience founding and operating start-up

    businesses. Joe Smith has started two successful contracting businesses in the Wood City

    area that have broken even after only four to six months. His first business venture, a

    residential painting service, became one of the most recognized names in residential

    painting in the area of Groves, Texas.

    Joe’s Quality Painting will offer high quality interior and exterior painting for

    residential, commercial, and industrial properties. Due to the continuous growth in

    population and construction in the Wood City area, Joe’s Quality Painting will be highly

    successful and enjoy continuous growth. Joe’s Quality Painting will go from the

    operation of a single crew of three employees, to multiple crews within two years.

     Joe’s Quality Painting’s predicted success and growth is based upon extensive market research demonstrating the explosive growth trend in construction in the Wood

    City area. This trend, along with the limited competition in the Wood City area, offers a

    promising future for Joe’s Quality Painting.



     Americans spent an estimated $119.1 billion in home improvements and repairs in

    1996, according to the U.S. Census Bureau. Affluent Americans (those with incomes of

    $100,000 or more) spend $31 billion a year on home improvements.(Source: Yankelovich

    Partners) According to the U.S. Census Bureau, 78 percent of all home remodeling is done by professional sub-contractors. According to a survey conducted by Getting To

    Know You, the largest homebuyer welcoming program in North America, 79.4% of

    respondents plan to make major home improvements within the year. Among families

    with children, 86.8% cited a need to remodel.

    Market analysis is very favorable toward the painting and overall construction and remodeling business in the Wood City area. Population, housing and commercial

    construction demands make Wood City an ideal location for this type of business.

    California's Central Valley is one of the nation's fastest growing regions as well as one of

    the more rapidly developing regions in the state. Wood City, with an historic growth of

    66% since 1980, has been identified as one of the top ten expansion cities in the nation.

    The future will be defined by even more rapid expansion because 67% growth is

    projected through 2005 and 71% to 2020, as shown in Table 1. In addition, new home

    construction is predicted to grow at about 3.4 percent, opening up many opportunities for

    painting contractors. (Wood City Development Office) At least two factors are

    contributing to the Central Valley's faster growth. First, the Valley's population is

    growing faster than the state's during the current decade as homebuyers seek affordable

    housing in this location. This growing population needs a range of goods and services

    and that will fuel the regional economy. Second, businesses continue to relocate in this


location because of lower costs, favorable business climate and the overall positive

    quality of life. Much of this growth is "spillover" from California's costly and congested

    coastal urban regions.

    TABLE 1Population growth

    1995 1998 2005 2020 Actual Actual Projection Projection

    Wood City 109,500 114,349 152,726 214,097

     Source: Wood City Development Office

    In summary, the general industry analysis shows that Wood City is expected to

    experience substantial population, housing and commercial construction growth, which

    makes it a prime location for a painting contractor business. Wood City’s cost of living

    is among the lowest in the state of California. (American Chamber of Commerce) Which

    is beneficial because the target market for this type of service is middle to upper income

    families. Table 2, ACCRA Cost of Living Index, 1997, provides informative statistics

    about the cost of living in the Wood City area.

    TABLE 2


    Wood City 107.5

    San Sacro 103.7

    Angel City 117.6

    Santego 120.4

    Franklin Bay 174.6

    SOURCE: American Chamber of

    Commerce Research Association



     In five years, Joe’s Quality Painting will be an area leader in the painting industry in the Wood City area, and plans will be developed and implemented to serve

    surrounding cities.


     The main vision trigger will be the slogan: ―Joe’s Quality Painting—Don’t settle

    for less!‖ The vision trigger will emphasize the overall high level of quality provided by

    Joe’s Quality Painting service. This high level of quality will include the best painting

    products, attention to detail, and total commitment to complete customer satisfaction.


    Joe’s Quality Painting’s mission statement is presented below:

     We, the employees and owner of Joe’s Quality Painting, make the

    following pledge to our valued customers:

     We pledge to provide a professional quality painting service to

    both our residential and commercial customers in the Wood City area.

     We pledge to go the extra mile in order to ensure your complete


     We pledge to use only paint that is of the highest quality and

    environmentally safe, in order to better serve you and the community.

     We also pledge to be open and responsive to your comments and




    Joe’s Quality Painting plans on doubling in size in the next three years. The business objectives for the next three years are:

    1. Owner draw of $28,080 by the end of Year 1.

    2. Cash break-even by the end of the first year.

    3. Owner draw of $33,000 by the end of Year 2.


     The business operations of Joe’s Quality Painting will be described using the main functions of the business: marketing, competitive analysis, legal structure,

    management expertise, support personnel, and financial information.


     Exterior Painting:

     New construction

     Remodel paint jobs

     Water proofing decks

     Sand blasting, water blasting

     Stucco repair

     Graffiti removal

     Interior Painting:

     New construction

     Remodel paint jobs


     Drywall repair

     Textured coats

    Joe’s Quality Painting will perform these services on commercial properties as well as

    residential properties.

Painting and Related Services

     Joe’s Quality Painting will perform the following services. New construction services will include painting interiors, exteriors, decks as well as waterproofing and

    applying textured coats. Remodel jobs will include matching the new stucco with the old

    stucco to insure that the colors match perfectly. Repair and preparation work that is

    needed will be completed as well. Water proofing will be done for apartment decks,

    garages, and private homes. Water blasting and sand blasting will be performed to clean

    areas that are going to be painted. Drywall preparation and texturing will also be



     Joe’s Quality Painting will base its price on the industry average. The price of the

    paint will depend on the job. Exterior paint will cost between $15.00 to $25.00 a gallon. Each gallon will cover between 200 and 250 square feet of surface, a wall that is ten feet

    high by twenty feet long. Interior paint will cost between $15.00 to $20.00 a gallon.


    Because interior surfaces are smoother, the area covered will be between 300 and 350 square feet of surface. This means that one-gallon will cover a wall that is eight feet by thirty-eight feet. Waterproofing sealant costs between $20.00 and $35.00 per gallon and will cover only 150 square feet, an area of about ten by fifteen feet. Wood deck sealant costs between $15.00 to $30.00 a gallon and covers between 200 to 250 square feet. Drywall textured coating will cover between 150 to 170 square feet per gallon. This product costs from $5.00 to $10.00 a bag for the mixture. Stucco repair will cost between $50 to $100 depending on the size of the repair.

     The price per square foot to repaint an existing interior is $0.35; new construction interior paiting is $0.40. The price per square foot for exterior painting is $0.40 for either repaint work or new construction. Waterproofing cement decks and garages is $0.55 per square foot. Waterproofing a deck will cost $0.35 per square foot.


     The business will be located in Wood City just three blocks from the freeway. This will provide access to any location in Wood City in less than half an hour. The location will also provide access to three nearby cities: Firestorm, Woodranches, and Big City. The longest commute needed to reach any location in these three cities would be one hour.


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