Business Plan For:Challenge- X Electric MotorSubmitted to: General MotorsDesign Team:Michael Robertson (Director) Jeff Smith (Hardware Engineer) Dustin Ott (Hardware Engineer)Craig Ross (Software Engineer)Submitted to:ECE4522 Senior Design IIDepartment of Electrical and Computer EngineeringMississippi State UniversityFebruary 1, 2005Business Plan 11.0MissionSpecialty Motors Researching is the leader in providing solutionsinvolving Hybrid Automobiles. We also specialize in custom fitting thespecial applications required for converting vehicles into hybridvehicles. The latest technologies are researched and evaluated.Numerous hours are spent modeling, using today’s state of the artmodeling and simulation software. The research and modeling is alldone from Mississippi State Universities state of the art Center forAdvanced Vehicular Systems (CAVS). 1.1 Objectives• To make Specialty Motors Research the number one provider ofsolutions involving Hybrid Automobiles.• To have at least 50 customers the first year bringing in an initial grossprofit margin of 25% and increasing that by 2% every year until 31% isreached.• Achieve a growth rate of 20% per year the first 4 years until we establish100 customers per year.1.2 Keys to Success Our private customer base consists of the largest names in theindustry. Regardless of size, we treat every customer as an opportunityto better our relationship with various manufactures allowing us to usegrow in size and continue to stay the leaders in technology. 1.3 Target Market Our initial target market is any hybrid electric vehicles currently in useand any hybrid vehicles in production. We are planning to fulfill all these customers’needs by supplying them with the newest state of the art information. We will befocusing on larger companies that are established the hybrid vehicle industry aswell as any smaller scale projects such as the ChallengeX competition. 1.4 Competitive AdvantagesOur company is based out of CAVS research center, therefore, giving usaccess to state of the art equipment and simulation tools. Within thecompany we have access to hybrid electric vehicle simulation toolssuch as PSAT and MagnaForce. PSAT can be used to simulate thecustomer’s specifications to see how their specifications will performbefore physical testing. MagnaForce can be used to measure andobserve characteristics of different electric motors. Since our companyis related to hybrid vehicle configuration advice, there are very littlecompetitors. We also have tools to package the customer’s product andto test the configuration chosen such as: cranes, dynamometers, andelectronic measuring devices. 1.5 Basic StrategiesIn order for our company to succeed, we will need to secure properfunding through angel investors and personal resources. The funds willgo toward research, marketing, customer satisfaction, and newavailable technologies. Every engineer will be responsible for a certainnumber of customers. They will also be responsible for marketing andkeeping up to date on recent technological advances. 1.6 HistoryMichael Robertson, Jeff Smith, Dustin Ott, and Craig Ross foundedspecialty Motors Researching in August 2004. Each of these founderssaw that the car companies struggle in the latest technology of electricmotors and failed to understand how to match expectations with motordesign characteristics. 1.7 Company ServicesOur company can research any application of electric motors. Ourservices range from the research and testing phase to implementation.We are fully prepared to take the customers ideas and designs andmodel them in software so that results can be produced before everpurchasing an item. Additional services of research can lead to moreefficient applications that are designed to meet and exceed thecustomer’s expectations. Our onsite implementation lab also enablesus to custom fit the design with an existing item. Business Plan_as22.0 Start up Plan and CostBecause our company is located in CAVS research center, the constructionof a new building is not required. However, a place in CAVS must berented. The cost to rent the space will be rather expensive, due to the factthat a deposit will be needed to acquire use of the equipment in CAVS.The below chart is the plan for start up along with the cost for each step.The assets are also found in the below chart. Startup Expenses – firstyearLegal $1,500Marketing $10,000Stationary $3,000Insurance $15,000Lease atCAVS$1,000/monthOther $5,000Total: $46,500Total Start- up Requirements= $396,5002.1 Initial Breakeven ChartTo acquire this initial investment, we are using various portions ofour own capital as well as investments from angel investors. Thebreakdown for our investments can be seen below:InvestorsPersonalinvestor 1$56,500Personalinvestor 2$50,000Personalinvestor 3$50,000Personalinvestor 4$50,000Angel Investors $90,000Bank Investors $100,000TotalInvestments$396,500Startup AssetsCashrequirements$300,000Total Assets: $350,000Total investments = $396,500 Total expenses = $396,000Total Capitol = $350,000 2.2 Sales Forecast and AssumptionsSales 2005 2006 2007 2008Customers 50 60 72 86Project Consulting $3,000/customer$2,000 $2,000 $2,000Market research $1,000/customer$1,000 $1,000 $1,000Retainer Consulting $2,000/customer$2,000 $2,000 $1,000Equipment $10,000/customer$10,000$10,000 $10,000Total Sales: $800,000 $900,000$1,080,000$1,204,000Direct Cost 2005 2006 2007 2008Project Consulting $600/customer$600 $600 $600Market research $200/customer$300 $400 $400Retainer Consulting $400/customer$400 $400 $400Equipment $6,000/customer$6,000 $6,000 $6,000Subtotal DirectCost$360,000 $438,000$532,800$636,400Sales- Direct CostTotal$440,000 $462,000$547,200$567,6002.3 Personnel Plan 2005 2006 2007 2008President $60,000$60,000$80,000$80,000Engineers *3 $150,000$150,000$180,000$180,000Sales People $0
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