Free Wood Pellet Manufacturer 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 $250,000 for the development of a wood pellet manufacturing company while showcasing the expected financials and operations over the next three years. Wood Pellet Manufacturer, Inc. (“the Company”) is a New York based corporation that will sell large inventories wood pellets that are used for home furnaces. The Company was founded by John Doe.
1.1 Products and Services
Wood pellets are commonly used products produced from scrap wood and saw dust. Typically, these pellets are used in animal bedding and as fuel in small free standing wood pellet burning stoves. There is strong year round demand for these products, and the Company will be able to generate highly predictable cash flows on a monthly basis from the manufacturing and distribution of these products. The third section of the business plan will further describe the produces offered by the Wood Pellet Manufacturer.
1.2 The Financing
Mr. Doe is seeking to raise $250,000 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 production location. • Financing for the first six months of operation. • Capital to purchase the Company’s inventory. Mr. Doe will contribute $50,000 to the venture.
1.3 Mission Statement
The Wood Pellet Manufacturer’s mission is to become the recognized leader in its targeted market for providing wood pellets for home furnaces at a low cost.
1.4 Mangement Team
The Company was founded by John Doe. Mr. Doe has more than 10 years of experience in the manufacturing 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
As time progresses, Management may seek to continually increase its manufacturing capacity by either acquiring additional production equipment or developing additional facilities while concurrently acquiring additional wood pellet manufacturing equipment.
2.0 Company and Financing Summary
2.1 Registered Name and Corporate Structure
Wood Pellet Manufacturer, Inc. The Company is registered as a corporation in the State of New York.
2.2 Required Funds
At this time, the Wood Pellet Manufacturer requires $250,000 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 the Wood Pellet Manufacturer, 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 the Wood Pellet Manufacturer. Based on historical numbers, the business could fetch a sales premium of up to 4 times earnings.
3.0 Products and Services
As stated in the executive summary, the Company will be actively engaged in the production and distribution of wood pellets (by the ton), which are produced from scrap wood and saw dust. The Company will acquire inventories of scrap wood products from local and regional saw mills and lumber yards that are seeking to dispose of these unusable (to them) inventories. Once acquired, the Company’s shop will be able to produce small wood pellets that are commonly used in small free standing house hold furnaces. These wood pellets are also frequently used in conjunction with the production of animal bedding products. The per ton price for wood pellets is $250.
4.0 Strategic and Market Analysis
4.1 Economic Outlook
This section of the analysis will detail the economic climate, the wood pellet manufacturing 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, wood pellet manufacturers tend to operate with great economic stability as people will continue to purchase these goods in any economic climate.
4.2 Industry Analysis
Within the United States, there are more than 3,800 companies that specialize in the production of wood products (which includes wood pellet manufacturing). Approximately 10% of these companies have production capabilities to produce wood pellets. Aggregately, these businesses generate more than $25 billion of revenue per year while providing jobs to more than 110,000 people. Aggregate payrolls in each of the last five years have exceeded $3.5 billion. This is a mature industry, and the excepted future growth rate is expected to mirror that of the general population and economic growth. One of the strong points about this industry is that market agents operate with a strong degree of economic stability as people will continue to require fuel for wood burning stoves (especially in winter) and in conjunction with the production of animal bedding.
4.3 Customer Profile
It is difficult to determine the average customer profile for Wood Pellet Manufacturer, Inc. as the business will sell its wood pellet products directly to third party distributors and wholesalers that in turn will sell branded or bulk inventories to retail stores or directly to end users. However, based on market research, there are approximately 400 companies that specialize in the retail distribution of wood pellets (for both animal bedding and fuel purposes), and the Company will be able to develop a number of ongoing purchase order relationships with wood pellet distributors throughout the entire United States.
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
The Wood Pellet Manufacturer 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
5.2 Marketing Strategies
The marketing required by the Company will be minimal as Wood Pellet Manufacturer will not market its products directly to the general public. As stated many times in this business plan, the Company has already begun to secure purchase order relationships that will ensure that the Company can produce and immediately distribute its inventories from the onset of operations. As the business expands, the business may seek to develop relationships with additional distributors of wood pellet products. In these instances, Management will directly contact other distributors in the industry to discuss how the business can supply them with the raw wood pellets that they are seeking to distribute directly to end users and retailers. Brochures and other sales literature will be produced to showcase the facility, pricing, and operations of the business when seeking to develop new ongoing purchase order relationships.
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
• Wood Pellet Manufacturer will have an annual revenue growth rate of 7% per year.
• The Owner will acquire $250,000 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 modestly sensitive to changes in the general economy. The wood pellet products manufactured by the Company are in demand on a year round basis among people that have animal bedding requirements, and in cold temperatures – fuel for wood pellet burning furnaces.
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