Car Rental Business plan Essay

The purpose of this transaction plan is to raise $300,000 for the germinatement of a cable car letting room while showcasing the expected financials and operations over the next lead years. The auto lease chest of drawers Inc. (the come with) is a New York based corporation that allow provide the rental of economy, standard, and lavishness automobiles in its targeted market. The union was founded in 2009 by John free energy.1.1 Products and ServicesAs mentioned above, the motorcar Rental Agency depart be actively engaged in the rental of economy class, standard, and luxury fomites for tourists and vacationers within its targeted market. A bulk of the Companys revenues give come from the daily rental charges for vehicle usage. The blood line enterprise will also recognize revenues from the sales event of insurance services and gasoline charges to customers. At the onset of operations, the Company intends to have a contract fleet of 30 vehicles. The deuce-ace secti on of the business plan will further define the services offered by the Car Rental Agency.1.2 The FinancingMr. Doe is seeking to raise $300,000 from as a bank loan. The interest rate and loan agreement ar to be further discussed during negotiation. This business plan assumes that the business will receive a 10 year loan with a 9% fixed interest rate.1.3 Mission StatementThe Car Rental Agencys mission is to become the recognized leader in its targeted market for renting afford fitted vehicles to the general public on a daily basis.1.4 Mangement groupThe Company was founded by John Doe. Mr. Doe has much than 10 years of experience in the automotive industry. Through his expertise, he will be able to bring the operations of the business to profitability within its first year of operations.1.5 Sales ForecastsMr. Doe expects a noticeable rate of growth at the get of operations. Below are the expected financials over the next three years.1.6 Expansion PlanThe Founder expects that th e business will aggressively expand during the first three years of operation. Mr. Doe intends to implement marketing campaigns that will effectively target individuals, tourists, and business travelers within the target market.2.0 Company and Financing Summary2.1 Registered Name and unified StructureThe Car Rental Agency, Inc. The Company is registered as a corporation in the State of New York.2.2 Required FundsAt this time, the Car Rental Agency requires $300,000 of debt funds. Below is a breakdown of how these funds will be used2.3 Investor EquityMr. Doe is not seeking an investment from a third party at this time.2.4 Management EquityJohn Doe owns 100% of the Car Rental Agency, Inc.2.5 Exit StrategyIf the business is very successful, Mr. Doe whitethorn seek to sell the business to a third party for a significant earnings multiple. Most likely, the Company will hire a subordinate business broker to sell the business on behalf of the Car Rental Agency. Based on historical number s, the business could fetch a sales bonus of up to 4 times earnings.3.0 Products and ServicesBelow is a description of the car rental services offered by the Car RentalAgency.3.1 Daily Car RentalsThe primary source of revenue for the business will come from the direct daily rental of the Companys fleet of approximately 30 vehicles. The Company will have three tiers of rentals including economy, standard, and luxury. Management expects that 75% of all rentals will fall into the economy or standard class. A limited number of luxury vehicles will be held on the lot for wealthy tourists and business travelers. Daily charges to clients will range from $49 to $99 per day depending on the type of vehicle they intend to rent.3.2 Insurance Fees and Ancillary ServicesIn addition to daily charges made to vehicle renters, the Company will earn secondary streams of revenue from the sale of additional insurance. This is an important secondary steam of revenue for the business as sales of additio nal car insurance will generate substantial utter(a) margins for the Car Rental Agency. Additionally, the Company will charge substantial fees to customers that do not return the vehicles with full gas tanks. Approximately 25% of the Companys aggregate revenues will come from the sale of insurance and gas fees.4.0 Strategic and Market Analysis4.1 Economic OutlookThis section of the analysis will spot the economic climate, the car rental industry, the customer profile, and the competition that the business will face as it progresses through its business operations. Currently, the economic market condition in the United States is in recession. This slowdown in the economy has also greatly impacted real estate sales, which has halted to historical lows. Many economists expect that this recession will continue until mid-2009, at which point the economy will begin a prolonged recovery period. However, Car Rental Agencies typically operate with a strong degree of economic stability as b usiness travelers will continue to need vehicles for their business trip needs.4.2 Industry AnalysisWithin the United States, there are more than 5,000 companies (that operate one or more locations) that provide daily car rental services to the general public. Each year, these businesses aggregately generate more than $20billion dollars of revenue and provide jobs to more than 120,000 pack. Aggregate payrolls in each of the last five years have exceeded $3.1 billion. This is a mature industry, and the rising expected growth rate is expected to equal that of the general economy. As mentioned above, despite the currently high gasoline prices, the industry will continue to ride out profitable as business travelers will continue to require rented vehicles during their business trips.4.3 Customer ProfileIn this section of the analysis, you should describe the type of customer you are seeking to acquire. These traits include income size, type of business/occupation how far away from y our business is to your customer, and what the customer is looking for. In this section, you can also put demographic information about your target market including population size, income demographics, level of education, etc.4.4 Competitive AnalysisThis is one of the sections of the business plan that you must put out tout ensemble on your own. The key to writing a strong competitive analysis is that you do your research on the local competition. Find out who your competitors are by searching online directories and searching in your local Yellow Pages. If there are a number of competitors in the same industry (meaning that it is not feasible to describe each one) then showcase the number of businesses that compete with you, and why your business will provide customers with service/products that are of better quality or less(prenominal) expensive than your competition.5.0 Marketing PlanThe Car Rental Agency intends to maintain an extensive marketing campaign that will ensure maxi mum visibility for the business in its targeted market. Below is an overview of the marketing strategies and objectives of the Car Rental Agency.5.1 Marketing Objectives Establish relationships with airports and travel agents surrounding the target market. Implement a local campaign with the Companys targeted market via the use of flyers, local newspaper advertisements, and word of mouth advertising. Develop an online presence by developing a website and placing the Companys image and contact information with online directories.5.2 Marketing StrategiesMr. Doe intends on using a number of marketing strategies that will allow the Car Rental Agency to easy target tourists and business travelers coming to the target market. These strategies include traditional print advertisements and ads placed on search engines on the Internet. Below is a description of how the business intends to market its services to the general public. The Car Rental Agency will also use an internet based strate gy. This is very important as some(prenominal) people seeking local services, such as car rental agencies, now the Internet to conduct their preliminary searches. Mr. Doe will register the Car Rental Agency with online portals so that potential customers can easily reach the business.The Company will also develop its own online website, which will include functionality for people to book and pay for vehicle rentals directly through the Companys online platform. This marketing feature is common to most companies that rent cars to the general public. The Company will also place advertisements on major travel portals such as Expedia, Orbitz, and Travelocity. Mr. Doe will also develop relationships with local travel agents that will commit arrangements for rentals among people that are traveling through the target market.5.3 PricingIn this section, describe the pricing of your services and products. You should provide as much information as possible about your pricing as possible in t his section. However, if you have hundreds of items, condense your product list categorically. This section of the business plan should not sail more than 1 page. 6.0 Organizational Plan and Personnel Summary6.1 Corporate Organization6.2 Organizational Budget6.3 Management BiographiesIn this section of the business plan, you should write a two to four paragraph biography about your work experience, your education, and your skill set. For each owner or key employee, you should provide a apprisebiography in this section.7.0 Financial Plan7.1 Underlying Assumptions The Car Rental Agency will have an annual revenue growth rate of 16% per year. The loan will have a 10 year term with a 9% interest rate. The Owner will acquire $300,000 of debt funds to develop the business.7.2 Sensitivity AnalysisIn the event of an economic downturn, the business may have a decline in its revenues. However, among business travelers, renting a car is a necessity. As such, the Car Rental Agency will be abl e remain profitable despite a drop off in tourist activity. 7.3 Source of Funds7.4 General Assumptions7.5 wage and Loss Statements7.6 Cash Flow Analysis7.7 Balance Sheet7.8 General Assumptions7.9 Business RatiosExpanded Profit and Loss StatementsExpanded Cash Flow Analysis