JANITORIAL SERVICE FEASIBILITY ANALYSIS
Business Plan Instructions
Formatting
The business plan will be a PowerPoint presentation consisting of 6 to 10 slides covering the information in the instructions. Since this is a PowerPoint presentation, Times New Roman, black, 12 point font with one inch margins is not required. Make an attractive presentation that complements your business.
MY PART OF THE PAPER IS THE
Mission and Vision Statement ONE SLIDE EACH - (The mission statement tells why the organization exists. The vision statement tells where the organization is going over a given period of time and what the organization will look like when it gets there.)
PLEASE USE THE INFORMATION PROVIDED WITHIN THE
JANITORIAL SERVICE FEASIBILITY ANALYSIS BELOW
A minimum number of sources is not required. Cite and reference the sources used. Use the notes pages to expound on your slides. Slides should be concise and each slide should have notes. When writing your notes, think “talking points.” What might the people you are presenting to ask? What do you want them to know about your proposed business?
* Do not create a presentation with black font on a white background. This is too stark for a PowerPoint presentation.
* If you are going to do citations on the slide, keep them small so they don’t detract from the information. It is best to do the citations in the notes pages.
JANITORIAL SERVICE FEASIBILITY ANALYSIS
Proposed Business Description
Cleaning of a facility or home can be a full-time job. Liberty Janitorial Service is a new company that will provide high quality janitorial cleaning services to its clients. What makes our service particularly unique is that we use hypo-allergenic & non-toxic cleaners. We offer regular visits to proactively reduce allergens, bacteria, and stress. We are scheduled to begin operations in the summer of 2018. Liberty Janitorial Service will be a partnership that is family owned and operated by six members.
Our professional janitorial services include everything required to care for residential and commercial properties. All supplies and cleaners are supplied by us. Upon request, we will use the supplies of our client’s choice. We take pride in being flexible. We have cleaners available around the clock to adjust to the client’s needed times of service.
Typically, duties include daily services such as dusting and vacuuming as well as more advanced functions which include cleaning carpet, cleaning air ducts and washing windows. Liberty Janitorial Services provides a service that can be trusted, affordable and is an efficient way to keep your home and business clean. We recognize that each client’s budget is different. We design packages based on a client’s unique cleaning preferences, schedule and budget. No contracts and no hassle.
People will judge your residence or facility from the moment they step a foot through the front door. A clean home and facility conveys professionalism, care, comfort and attention to detail, which is exactly what Liberty Janitorial Service provides for its clients. We pledge to always offer a professional and courteous service and to never compromise the quality of cleaning offered. We take pride in the health and safety of homes and workplace, and to always respect the natural environment.
Industry & Market Feasibility Analysis
The cleaning industry has been perceived as the industries of people without financial muscles. However, this perception is changing because people are making good returns from the industry. Today, the number of Janitorial Services providing companies has increased significantly, but there are still many opportunities to be explored. This paper will examine the janitorial service industry’s performance, that will allow us to be better informed and make a decision if it is the best industry to invest in.
Sociocultural
People in the modern world have changed their ways of thinking and doing things. Needs have increased, and that has forced many to change the way they approach their day to day activities. Cleaning was a routine in many households just a few years ago; however, that has changed, and today, people opt to hire cleaners (Rhodes et al. 2016). In offices and institutions, many organizations have seen the need to hire outside cleaning professionals to save on the cost of cleaning. The old habits of hiring regular people and putting them on the permanent payroll have been replaced by the need to higher professionals on a contract basis. As a result, the industry is expanding. The need to bring in more cleaners is seeming to become more valuable.
Technological
The technology industry y is growing. This has given companies a chance to use technology to attract and serve as many customers as possible. The use of the social media platforms is rampant. Many new entries to the market have utilized the social media to market their services and charges. Organizations seeking cleaning services are also utilizing the social media platforms to identify their potential services providers. The introduction of machines which are more efficient has helped cleaners become more productive. It has also made work much easier. As a result, a group of cleansers can service a larger number of customers within a specified timeframe. These machines have also come to enhance efficiency and increase profits. A machine nowadays can work three times faster than person, saving much needed time.
Economic
Establishing a Janitorial service business does not require a lot of money. It is one of the businesses where one only needs materials to perform the first task. The rest of the tasks will help in raising the capital and growing the business. Economic threats are not likely to have a major effect on the business. Whether the business is doing good or bad, companies and institutions must be cleaned. Therefore, the business is not likely to be affected by the economy. The industry is still young, and therefore, only a few companies are in the market, and that makes it easier for them to survive during hard economic times.
Political and legal
Political tensions might affect the business. When there are no offices to clean or when the movements are limited due to political tensions, the business is affected because it depends on the offices (Johnson, 2016). The industry is currently not faced with legal issues. All that is needed is to apply for the license to operate. Since the industry is still young, there are not that many requirements to be met like other businesses.
Service Feasibility Analysis
Service
The goal is to open a family owned and operated Janitorial Service to provide superior cleaning services to local businesses and families within the area. The cleaning supplies used will be environmentally friendly to include Hypo-Allergenic & Non-Toxic Cleaners.
Target Market
Within the three years of operation, we plan to open another location near up and coming commercial areas. The target market is both corporations large and small and residents within the surrounding areas.
Why Liberty Janitorial Service?
Commercial real estate occupancy and income growth drive demand for cleaning services. Janitorial services average annual revenue per employee is approximately $35,000. Janitorial Services account for about 90 percent of industry revenue. Janitorial work includes general services, such as cleaning, trash pickup, floor polishing, and the specialty services of cleaning carpet, ducts and washing windows (sbdc). Due to the projected upswing in the economic cycle, the education, health and medical industries will outsource many cleaning needs, providing sustained growth for the industry (Donovan, 2015)
Why should a commercial organization or an individual family utilize our janitorial service? If you are a family with a busy schedule, you may not have time to thoroughly clean your home the way you may want to. If you are a business, hiring internal employees to clean will not only cost the company to pay them, but these individuals will also need to be supervised and this comes with an even bigger expense. By utilizing Liberty Janitorial Services, you can cut out the extra expenses and only pay for the service being provided. Liberty Janitorial Service will provide you with up-front cost breakdowns for services. There will be no hidden fees.
Special Feature
Liberty Janitorial Services’ new and existing customers can stay connected by utilizing the companies Facebook, Twitter and Instagram sites. Customers can click on the link to schedule services, rate their experience and signup for the company’s monthly newsletter. The sites will also list any special discounts that are being offered for customer. For example, if you are a first-time customer, you can receive a discount on your first cleaning. The Janitorial Service also provides deep floor and window cleaning services. Liberty Janitorial Services will also utilize platforms like YouTube and LinkedIn to market the business and services, provide helpful tips and how-to videos. The Business will also use local yellow books and word of mouth advertising.
The Janitorial Services will also partner with local churches and local vendors that sell cleaning products. By doing this, it will broaden the customer base for both the Janitorial Service and the company providing the supplies.
Management Team
Our human resources will be between two -seven individuals depending upon the job. All cleaning supplies will be provided unless client request to use specific cleaning supplies which would be furnished by them.
I do believe that customers will be willing to purchase our Janitorial Services. We will perform a survey to ask customers some questions in order to gauge if we will obtain their business.
Financial Feasibility Analysis
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Forecast Analysis - Income Statement |
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2019 |
2020 |
2021 |
2022 |
2023 |
2024 |
2025 |
Totals |
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Sales |
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Sales |
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3,000,000 |
4,500,000 |
5,500,000 |
7,900,000 |
9,200,000 |
11,000,000 |
15,000,000 |
56,100,000 |
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Other |
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0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
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Total Sales |
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3,000,000 |
4,500,000 |
5,500,000 |
7,900,000 |
9,200,000 |
11,000,000 |
15,000,000 |
56,100,000 |
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Less Cost of Goods Sold |
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Labor |
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700,000 |
875,000 |
1,225,000 |
1,750,000 |
2,100,000 |
2,800,000 |
3,150,000 |
12,600,000 |
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Overhead |
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13,200 |
13,200 |
13,200 |
13,200 |
13,200 |
13,200 |
13,200 |
105,600 |
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Other |
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0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
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Total Cost of Goods Sold |
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713,200 |
888,200 |
1,238,200 |
1,763,200 |
2,113,200 |
2,813,200 |
3,163,200 |
12,705,600 |
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Gross Profit |
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1,886,800 |
3,611,800 |
4,261,800 |
6,136,800 |
7,086,800 |
8,186,800 |
11,836,800 |
43,394,400 |
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Operating Expenses |
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Salaries and Wages |
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1050000 |
1050000 |
1050000 |
1050000 |
1050000 |
1050000 |
1050000 |
7350000 |
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Employee benefits |
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76,000 |
77,800 |
78,500 |
79,780 |
80,400 |
81,972 |
82,309 |
556,761 |
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Payroll Taxes |
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21,000 |
20,592 |
19,230 |
18,000 |
17,395 |
16,294 |
15,596 |
128,107 |
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Rent |
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3000 |
3200 |
3350 |
3451 |
3569 |
3682 |
3,706 |
8,034,868 |
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Utilities |
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6000 |
6200 |
6340 |
6490 |
6562 |
6692 |
6,752 |
45036 |
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Repairs and Maintenance |
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2000 |
2066 |
2184 |
2239 |
2361 |
2495 |
2,562 |
15907 |
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Insurance |
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1000 |
1022 |
1056 |
1071 |
1089 |
1100 |
1,300 |
7,638 |
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Travel |
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3024 |
3062 |
3079 |
3085 |
3098 |
3106 |
3,115 |
21,569 |
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Telephone |
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12,000 |
12,790 |
12, 880 |
12998 |
13040 |
13120 |
13,244 |
77,192 |
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Postage |
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2246 |
2361 |
2469 |
2510 |
2691 |
2738 |
2,842 |
17,857 |
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Office supplies |
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4000 |
4180 |
4260 |
4359 |
4481 |
4528 |
4,691 |
30,499 |
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Advertising |
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1200 |
1260 |
1320 |
1369 |
1398 |
1404 |
1,427 |
9,378 |
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Marketing / promotion |
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1500 |
1580 |
1630 |
1680 |
1720 |
1780 |
1820 |
1860 |
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Professional Fees |
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900 |
948 |
962 |
978 |
984 |
993 |
1,010 |
6,775 |
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Training and development |
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840 |
857 |
867 |
875 |
889 |
896 |
909 |
6,133 |
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Bank changes |
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900 |
1023 |
1034 |
1048 |
1053 |
1066 |
1079 |
7203 |
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Depreciation |
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900 |
1023 |
1023 |
1040 |
1063 |
1073 |
1085 |
7207 |
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Interest Expense |
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4000 |
4000 |
4000 |
4000 |
4000 |
4000 |
4000 |
28,000 |
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Other |
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0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
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Total Operating Expenses |
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1190510 |
1193964 |
1181304 |
1194973 |
1195793 |
1196939 |
1,197,447 |
8350930 |
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Operating Income |
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Interest income (expense) |
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11,000 |
13,590 |
13,900 |
14,492 |
15,238 |
15,608 |
15,945 |
99,773 |
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Other income (expense) |
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0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
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Total Non-operating Income (Expense) |
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11,000 |
13,590 |
13,900 |
14,492 |
15,238 |
15,608 |
15,945 |
99,773 |
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Income (Loss) Before Taxes |
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1,179,510 |
1,180,374 |
1,167,404 |
1,180,481 |
1,180,555 |
1,181,331 |
1,181,502 |
8,251,157 |
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Income Taxes |
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117,951 |
118,037 |
116,740 |
118,048 |
118,056 |
118,133 |
118,150 |
825,116 |
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Net Income (Loss) |
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1,061,559 |
1,062,337 |
1,050,664 |
1,062,433 |
1,062,500 |
1,063,198 |
1,063,352 |
7,426,041 |
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Cumulative Net Income (Loss) |
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1,061,559 |
2,123,896 |
3,174,559 |
4,236,992 |
5,299,492 |
6,362,690 |
7,426,041 |
29,685,228 |
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Forecast Analysis - Balance Sheet |
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Opening |
Year 1 |
Year 2 |
Year 3 |
Opening |
Year 1 |
Year 2 |
Year 3 |
Year 4 |
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Assets |
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Current Assets |
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Cash |
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820,591 |
800,039 |
810,385 |
818,385 |
805,183 |
802,591 |
804,610 |
803,691 |
819,395 |
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Notes Receivable |
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2800 |
1500 |
1800 |
1650 |
2295 |
2051 |
1985 |
2194 |
2749 |
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Accounts receivable, net |
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543,891 |
510,985 |
538,730 |
540,618 |
517,392 |
505,284 |
501,983 |
500,831 |
541,910 |
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Inventory |
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0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
32,791 |
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Other |
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10,783 |
9095 |
10395 |
11,000 |
10296 |
9581 |
8093 |
9201 |
10,598 |
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Total Current Assets |
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1,378,065 |
1,321,619 |
1,361,310 |
1,371,653 |
1,335,166 |
1,319,507 |
1,316,671 |
1,315,917 |
1,407,443 |
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Long-Term Assets |
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Property, plant, and equipment |
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438,809 |
438,809 |
438,809 |
438,809 |
438,809 |
438,809 |
438,809 |
438,809 |
438,809 |
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Less accumulated depreciation |
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12,000 |
12,000 |
12,000 |
12,000 |
12,000 |
12,000 |
12,000 |
12,000 |
12,000 |
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Net property, plant, and equipment |
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404,952 |
404,952 |
404,952 |
404,952 |
404,952 |
404,952 |
404,952 |
404,952 |
404,952 |
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Other long-term assets |
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65,036 |
64,319 |
66,490 |
65,980 |
63,280 |
63,482 |
62,871 |
62,821 |
64,980 |
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Total Long-Term Assets |
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920,797 |
920,080 |
922,251 |
921,741 |
919,041 |
919,243 |
918,632 |
918,582 |
920,741 |
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Total Assets |
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2298862 |
2,241,699 |
2,283,561 |
2,293,394 |
2,254,207 |
2,238,750 |
2,235,303 |
2,234,499 |
2,328,184 |
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Liabilities |
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Current Liabilities |
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Short-term debt |
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200,704 |
198,720 |
192,701 |
193,614 |
185,201 |
178,014 |
169,495 |
164,192 |
156,272 |
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Current Maturities of long-term debt |
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85201 |
82,741 |
81,976 |
84381 |
82,453 |
88,084 |
86,942 |
81,542 |
83,742 |
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Accounts payable |
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85201 |
82741 |
81,976 |
84381 |
82,453 |
88,084 |
86,942 |
81,542 |
83,742 |
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Income Taxes payable |
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20,761 |
18,975 |
19,173 |
19,879 |
18,641 |
17,042 |
16,045 |
15,029 |
17,642 |
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Accrued liabilities |
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90,820 |
85210 |
86,480 |
87,504 |
83,052 |
85,018 |
76,424 |
78,042 |
89,652 |
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Other |
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12,682 |
12,951 |
11,349 |
11,194 |
11,749 |
10,593 |
11,482 |
12,692 |
10,382 |
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Total Current Liabilities |
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495,369 |
481,338 |
473,655 |
480,953 |
463,549 |
466,835 |
447,330 |
433,039 |
441,432 |
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Long-Term Liabilities |
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Long-Term debt less current maturities |
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220,721 |
204,854 |
215,953 |
218,542 |
208,757 |
199,711 |
196,832 |
186,863 |
212,763 |
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Deffered income taxes |
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80,842 |
76,041 |
78,042 |
79,053 |
75,928 |
76,883 |
78,784 |
79,444 |
80,952 |
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Other long-term liabilities |
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75,949 |
73,284 |
74,943 |
73,033 |
72,841 |
71,742 |
69,627 |
68,072 |
78,552 |
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Total Long-Term Liabilities |
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377,512 |
354,179 |
368,938 |
370,628 |
357,526 |
348,336 |
345,243 |
334,379 |
372,267 |
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Total Liabilities |
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872,881 |
835,517 |
842,593 |
851,581 |
821,075 |
815,171 |
792,573 |
767,418 |
813,699 |
Final Analysis
Regarding all of the information that has been gathered, it is safe to say that the concept of Liberty Janitorial Service is one that will succeed in terms of efficiency, sustainability, customer satisfaction, and profit. Specifically, Liberty will provide efficiency by using the best cleaning solutions that are powerful enough to kill most household bacteria. In addition, Liberty will utilize top-of-the-line cleaning equipment that will leave rooms looking brand-new. Moreover, Liberty will keep sustainability in mind by using equipment and cleaning solutions that are environmentally safe. When providing customer service, Liberty will go all out by hiring the best people that will provide honesty and courtesy to our customers.
When analyzing the profits, one can find that Liberty is poised to be a major success. According to the forecast analysis, Liberty will bring in massive profits for the next several years. The careful spending on such necessities as repairs and marketing is what will contribute to Liberty’s profit margins year in and out. All in all, Liberty Janitorial Service’s business philosophy is structured around the idea that the customer’s well-being and concerns, are of the upmost importance. As Sam Walton once said, “The goal as a company is to have customer service that is not just the best but legendary” (Walter, 2014, p.1). Liberty will live up to this idea, as it will provide affordable quality service that will appeal to all the wants and needs of its target markets. But aside from this, we at Liberty Janitorial Service feel motivated by the Word of God to do our very best. As Colossians 3:23 says, “Whatever you do, work heartily, as for the Lord and not for men” (The King James Study Bible). While our adherence to this work ethic might seem as if we are putting customer satisfaction aside in order to fulfill a need for spiritual fulfillment, that is far from the truth. For we believe that working to glorify God motivates us to do our best in creating a sustainable company that will serve to make the customers happy for years to come.
References
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Price, Kristen Three best ways to grow market shares. Retrieved 08Feb18
https://yourbusiness.azcentral.com/three-ways-grow-market-share-16523.html
Rhodes, E., Garrison, R., Morse, D., Getchis, T., & Macfarlane, S. (2016). Shellfish aquaculture feasibility study. Expanding shellfish culture in the NRAC region Constraints to existing industry expansion and an analysis of the economic feasibility of new, small-scale oyster culture businesses. Part II: The feasibility of new, small scale oyster culture businesses. Northeastern Regional Aquaculture Center. North Dartmouth, MA, USA.
Walter, E. (2015, September 20). 40 Eye-Opening Customer Service Quotes. Retrieved February 05, 2018, from https://www.forbes.com/sites/ekaterinawalter/2014/03/04/40-eye-opening-customer-service-quotes/#6a80bb0c6b7b