Free Credit Repair Service Business Plan
For Raising Capital from Investors, Banks, or Grant Companies!
Please note that the financials
in this complete free business plan are completely fictitious and may not
match the text of the business plan below. This free business plan demonstration
purposes only. If you are interested in purchasing the completed editable MS Word
and Excel documents for this business plan, please click the button below! Also,
the text of the business plan is formatted with a fully automated
table of contents.
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templates. All business plans come in Microsoft Word and Microsoft Excel format.
Each business plan features:
- Excecutive Summary
- Company and Financing Summary
- Products and Services Overview
- Strategic Analysis with current research!
- Marketing Plan
- Personnel Plan
- 3 Year Advanced Financial Plan
- Expanded Financial Plan with Monthly Financials
- FREE 30 Page Sample Private Placement Memorandum
- FREE PowerPoint Presentation for Banks, Investors,
or Grant Companies!
1.0 Executive Summary
The purpose of this business plan is to raise $100,000 for the development of a credit repair business while showcasing the expected financials and operations over the next three years. Credit Repair Service, Inc. (“the Company”) is a New York based corporation that will provide credit repair, debt consolidation, debt negotiation, and credit advisory services to customers in its targeted market. The Company was founded by John Doe.
1.1 Products and Services
Credit Repair Service, Inc. will provide customers with a high level of credit repair, debt consolidation, debt negotiation, and credit advisory services that seek to remove blemishes on a client’s credit report among the three major credit bureaus. Approximately 40% of the US population has issues with their credit profiles and as such, the market for credit repair guides is very strong. There is also very strong demand among immigrants that are seeking to build a credit profile in the Untied States. The business will hire licensed debt advisory and credit counselors that will work directly with both clients and lenders in regard’s to a client’s credit profile or debt issues. The Company will either receive fees (fixed price) from the client for these services or from the lender who is able to successfully renegotiate a debt obligation so that it does not enter collection. The third section of the business plan will further describe the services offered by Credit Repair Service, Inc.
1.2 The Financing
Mr. Doe is seeking to raise $100,000 from as a bank loan. The interest rate and loan agreement are 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. The financing will be used for the following: • Development of the Company’s office location. • Financing for the first six months of operation. • Capital to purchase FF&E and computers. Mr. Doe will contribute $10,000 to the venture.
1.3 Mission Statement
Credit Repair Service’s mission is to assist people with rebuilding and restoring their credit histories in a professional, ethical, and legal manner.
1.4 Mangement Team
The Company was founded by John Doe. Mr. Doe has more than 10 years of experience in the lending 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 Forecasts
Mr. Doe expects a strong rate of growth at the start of operations. Below are the expected financials over the next three years.
1.6 Expansion Plan
The Founder expects that the business will aggressively expand during the first three years of operation. Mr. Doe intends to implement marketing campaigns that will effectively target individuals within the target market.
2.0 Company and Financing Summary
2.1 Registered Name and Corporate Structure
Credit Repair Service, Inc. The Company is registered as a corporation in the State of New York.
2.2 Required Funds
At this time, Credit Repair Service, Inc. requires $100,000 of debt funds. Below is a breakdown of how these funds will be used:
2.3 Investor Equity
Mr. Doe is not seeking an investment from a third party at this time.
2.4 Management Equity
John Doe owns 100% of Credit Repair Service, Inc.
2.5 Exit Strategy
If the business is very successful, Mr. Doe may seek to sell the business to a third party for a significant earnings multiple. Most likely, the Company will hire a qualified business broker to sell the business on behalf of Credit Repair Service. Based on historical numbers, the business could fetch a sales premium of up to 4 times earnings.
3.0 Products and Services
Below is a description of the credit repair and advisory services offered by the Company.
3.1 Credit Repair and Credit Advisory Services
The primary source of revenue for the business will come from the direct consultation to client’s that have minor or substantial credit issues. The Company’s counselors will properly advise and work with clients to effectively mitigate negative remarks on an individual’s credit reports (among the three major credit bureaus: Experian, TransUnion, and Equifax). The Company will also offer per hour advice to clients regarding how to properly maintain their credit scores. Finally, the business will develop an internal program that monitors clients’ credit profiles on a monthly basis for an ongoing yearly fee. This tertiary stream of income is an important secondary revenue center as it will provide a recurring income stream for the business, which will substantially increase the Company’s valuation. In regards to fees, the client will pay directly for these counseling services, which will be offered at a fixed rate and predetermined before the Company develops a plan to improve a client’s credit. The Company will maintain extensive policies on fee disclosures to ensure that client’s clearly understand the costs associated with the Company’s services as well as all other applicable disclaimers and warranties.
3.2 Debt Negotiation and Other Services
In addition to credit advisory and repair services, the business will also offer debt renegotiation and debt management services to clients that are heavily saddled with credit card debt, automotive debt, or mortgages. The business, on behalf of clients, will work with lenders to adjust the terms of these loans and credit lines to effectively ensure that the client can continue to pay their creditors while concurrently ensuring that the creditors maintain portfolios of serviceable receivables. For this service, the Company will receive fees from lenders in exchange for successfully renegotiating a client’s debt. Full disclosures regarding fees for these services will be provided to the client to ensure that any conflict of interest is kept to an absolute minimum. It should also be noted that at all times, the Company will maintain the proper licensure to act as a credit counseling firm within each jurisdiction where Credit Repair Service, Inc. has a client.
4.0 Strategic and Market Analysis
4.1 Economic Outlook
This section of the analysis will detail the economic climate, the credit counseling 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 moderate. The meltdown of the sub prime mortgage market coupled with increasing gas prices has led many people to believe that the US is on the cusp of a double dip economic recession. This slowdown in the economy has also greatly impacted real estate sales, which has halted to historical lows. However, credit counseling and credit repair businesses typically operate with a great degree of economic immunity as people will continue to require these services on an ongoing basis, especially during deleterious economic climates. As such, Management feels that the current economic climate is actually an excellent time to launch this type of business as millions of people are currently having substantial issues with their credit profiles and debts.
4.2 Industry Analysis
The credit counseling and credit management industry represents over 5,000 established businesses that employ more than 15,000. Each year, these businesses aggregately generate more than $2 billion dollars a year of revenue and provide gross annual payrolls of $600 million dollars. The growth rate for this industry has been tremendous over the last five years as the growth of financial transaction over the Internet has increased significantly. Over the last five years, the number of agents operating within this market more than doubled, with income received by these firms increasing more than 300%. As lending has become much more scientific over the last fifteen years with the implementation of electronic credit reporting, FICO scores, and electronic employment records, the need for consumers to maintain strong credit profiles is tremendous. This is especially true in today’s economy where millions of people have over extended themselves with debt, and require professional assistance with loan renegotiations, credit repair services, and credit advisory services.
4.3 Customer Profile
Management expects that a diverse group of people will use the Company’s services. The target market sought by the Company will consist of financial disenfranchised people that have either not properly established credit or have had credit problems in the past. The business, after obtaining licensure to operate in multiple states will be able to effectively assist thousands of people with the credit challenges and debt management needs. Approximately 40% of adult Americans have some form of issue with the credit profile. As such, the potential market for this type of service exceeds 70 million people. Mr. Doe expects that the average income of a customer will be $28,000 to $45,000 per year.
4.4 Competitive Analysis
This is one of the sections of the business plan that you must write completely 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 expensive than your competition.
5.0 Marketing Plan
Credit Repair Service, Inc. intends to maintain an extensive marketing campaign that will ensure maximum visibility for the business in its targeted market. Below is an overview of the marketing strategies and objectives of the Company.
5.1 Marketing Objectives
• Establish relationships with accountants within the targeted market.
• Develop an online presence by developing a website and placing the Company’s name and contact information with online directories.
5.2 Marketing Strategies
Mr. Doe intends on using a number of marketing strategies that will allow Credit Repair Service, Inc. to easily target men and women within 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. Credit Repair Service, Inc. will also use an internet based strategy. This is very important as many people seeking local and regional service providers, such as credit advisory/repair companies, now the Internet to conduct their preliminary searches. Mr. Doe will register Credit Repair Service with online portals so that potential customers can easily reach the business. The Company will also develop its own website showcasing the services offered by the business, the Credit Repair Service’s team of credit counselors, and relevant contact information. The Company will maintain a sizable amount of print and traditional advertising methods within local markets to promote the credit repair services that the Company is offering. Mr. Doe will also develop ongoing referral relationships with accountants within the Company’s local market who will refer clients with significant credit repair/advisory issues. In time, this will become an invaluable source of new business for Credit Repair Service, Inc.
In this section, describe the pricing of your services and products. You should provide as much information as possible about your pricing as possible in this section. However, if you have hundreds of items, condense your product list categorically. This section of the business plan should not span more than 1 page.
6.0 Organizational Plan and Personnel Summary
6.1 Corporate Organization
6.2 Organizational Budget
6.3 Management Biographies
In 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 brief biography in this section.
7.0 Financial Plan
7.1 Underlying Assumptions
• Credit Repair Service, Inc. will have an annual revenue growth rate of 16% per year.
• The Owner will acquire $100,000 of debt funds to develop the business.
• The loan will have a 10 year term with a 9% interest rate.
7.2 Sensitivity Analysis
The Company’s revenues are not sensitive to changes in the general economy. In fact, during deleterious economic conditions (like the current economy), Mr. Doe expects an increase in revenue as more people turn to professional advisors regarding their credit and debt delinquency issues. Additionally, the Company generates high margin income from its services, which will allow Credit Repair Service, Inc. to thrive in any economic climate.
7.3 Source of Funds
7.4 General Assumptions
7.5 Profit and Loss Statements
7.6 Cash Flow Analysis
7.7 Balance Sheet
7.8 General Assumptions
7.9 Business Ratios
Expanded Profit and Loss Statements
Expanded Cash Flow Analysis