Creating A Business Plan

rjepsen

I am trying to develop a business plan for the company that I work for without having access to past financial records. Can anyone help me guestimate the following...

1. Typical overhead in terms of percentage. I.E. 3% of your revenue should be allocated to overhead.

2. Typical net profit margin in terms of percentage.

We currently are doing any where from 12-15 million a year and I feel if we were to be more organized and had control costs we could be much more than we are today.

Any help or other pointers anyone can give for me while building this plan is much appreciated.

Regards

Vinny

Your doing 12 to 15 million a year and dont have any idea what your finacial history is or if your making money? I fear you will be abused from everyone here.

If I were you I would be very frightened by that prospect.

You cant look at last years P&L and manualy, on a sheet of paper, do what ever realocation needed to layout your COGS, Gross profit, and O H?

You may not even need your P&L, do you have a check book with all your checks posted?

You may need to be refered to the sticky on "pricing, estimating and success".

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Roccies Asphalt Paving
The Right Way Driveway Company
If you say you cant, your a loser. If you say you wont, your a quiter. Which one do you want to be?

joasis

Seems to me that would be like building a multi-story building with no prints, and no instructions. Why were you tasked with such a chore anyway? A guestimate for a business plan sounds like an exercise in futility...what if you do it, and then they apply the numbers, and you missed?

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Grumpy

You are going to have to start the plan just as if you would for a completely new business. Make projections based on what you know, and since you don't know the past, you must act like there is not a past.

Seems to me this is an employee who is trying to take the initiave in the company and impress his/her bosses and move on up the ladder.

send_it_all

He said that he is an employee. I give him kudos for taking the initiative and trying to help straighten out a company that isn't his. I wish I had two just like him.

Giovanni

As Grumpy said without access to financial records you will have to start from scratch. I would use industry financials such as the NAHB's cost of doing business study, which they put out every year. If your company does much remodeling I would also look at Remodeling Magazine's Benchmarks.

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What's the REAL cost of doing it on the cheap?

Giovanni

Grumpy

Wow, I didn't know such a thing existed. I am going to go seek out that data for my own comparison. Thanks for that!

Giovanni

You're welcome Grumpy. Is there a trade association for your line of work? Maybe two different groups, roofing/gutters and siding/windows? I'd take a look at NARI to see what they have too.

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What's the REAL cost of doing it on the cheap?

Giovanni

Grumpy

www.nrca.net Member since 2004. They have similiar data which I have used, for example they give a weekly & monthly price of what (on average) each van really costs you to operate after note, insurance, repair, etc... and for equipment like trailers, cutters. It's a nice little refrence. It's called the roofing contractor's equipment cost schedule. It is roughly 26 pages.

For example an air compressor will cost you about $2 per hour to own and operate.
Ladder hoists at about $24 a day.
a 1/2 ton pickup truck is actually about $2000 a month to own and operate (plus gasoline).

It's great data if, for example, I want to add another truck to my fleet... I ask myself can I afford $2,000 a month?

When I am calculating my over head, and I want to buy a new piece of equipment, I know I have to add about $20 a day to own an air compressor. It's great if you want to put together a new crew or something, you can see how much it's going to cost you upfront and over time to see if it's really worth it.

Vinny

Good point

__________________
Roccies Asphalt Paving
The Right Way Driveway Company
If you say you cant, your a loser. If you say you wont, your a quiter. Which one do you want to be?