Jeff Jensen: An Outline For A Business Plan

Outline for Business Plan
Jeff Jensen
Stevens-Henager College
04/16/2013
Business Plan

Cover Letter
Dear Steve Merrill, I intend to open a business that specializes in the sale of firearms and ammunition to the public. The business will also offer educational classes for conceal and carry permits, and on the safe handling, cleaning and storage of firearms. We will also offer gunsmithing and have an indoor firing range available to the public with on-site instructors to help those of all firearms experience levels understand the basics of loading and firing.

Section 1: Executive summary The purpose of this business plan is to secure a one million dollar ($700,000 to $1,000,000) conventional business loan from a financial
institution in order to build my venture from the ground up. The company will be known and operated as The Red Five. The Red Five will offer firearms ammunition and accessories at competitive prices. I intend my company to be the “Wal-Mart” of gun stores, primarily a one stop shop for everything gun related; accessories, ammunition, educational classes, customization, gunsmithing, an indoor firing range. The major difference in my company form another sporting goods store such as Cabelas or Sportsman’s Warehouse, is that my company will be entirely gun- centric, rather than branching out to other outdoor activities and hobbies such as hunting or fishing I will only specialize in the sale, education and certification of firearms and firearm needs.

Section 2: Company Background

As the business will be a new entity and that the subject of firearms sales and ownership is a somewhat controversial issue, there will be a number of legal considerations. We will need to apply for a Federal Firearms License with the Bureau of Alcohol, Tobacco and Firearms and adhere strictly to all Utah state Firearm distribution laws.

Section 3: Management Team

Positions: * Owner CEO/CFO – Responsible for running the business, all of the financial aspects, marketing, everything to keep the business going * General Manager COO – responsible for daily storefront duties, opening closing, HR, customer service. * Instructors – The instructors will be responsible for holding the educational classes for firearms safety, conceal and carry permits, Utah gun laws and personal defense. * Salespersons – Responsible for assisting customers, suggesting products and services carrying out transactions, and all general duties to operate the storefront * Gunsmiths – responsible for servicing and customizing firearms for customers and fulfilling custom manufacturing orders. * Range Attendees – Responsible for supervising range operations and assisting customers with any range related needs.
Employee Experience: * Jeff Jensen – Bachelor’s Degree in business management and accounting with an emphasis in accounting * Candice Marti – Twelve years of retail management experience * Phil Hoffman – Retired Salt Lake City police officer, knowledgeable in Utah State gun laws licensed to instruct Utah Conceal Carry courses. Instructed Firearm defense courses for the Salt Lake Police Department for firearms. * Greg Mathews – ten years of experience as a range attendee for Lee Kay, Certified and proficient in weapon safety and handling. * Brian Marti – 7 years of experience as a machinist at Scorpion Engineering, 3 years of experience as a gunsmith. * Alex Prince – Conceal Carry Permit holder, Long time Firearm enthusiast, 4 years of sales experience. * Ki Gale – Conceal Carry Permit holder, 8 years of sales experience

Section 4: Financial Plan

In the first year alone we plan to spend at least six hindered thousand dollars for the general construction and startup of the business which will include building expenses, Operational expenses, initial inventory acquisition expenses, wages, utilities and state and federal
taxes. Starting the second year, we expect to start seeing growth as our initial startup expenses begin to decline and settle. After which due to local market trends a we should see a return of at least 30 % per quarter.

Section 5: Capital Required

The Initial Capital required will be no less than one million dollars. How these funds will be used is broken down as follows.

Expense | Minimum | Maximum | Lot acquisition | $100,000.00 | $175,000.00 | Construction Costs | $250,000.00 | $325,000.00 | Initial Inventory | $100,000.00 | $150,000.00 | Employee wages For the first year | $100,000.00 | $150,000.00 | Equipment, Machines, Displays, Shelving. | $30,000.00 | $40,000.00 | Utilities, Taxes, Licensing, Training, Etc. | $30,000.00 | $60,000.00 | Miscellaneous Expenses | $500.00 | $100,000.00 | Totals | $610,500 | $1,000,000.00 |

Section 6: Marketing Plan

As everyone knows, firearms are a hot button issue, which can cause certain instabilities and uncertainties. With that being said, the additional services and sales that The Red Five will offer will balance out any firearm restrictions or issues that may arise due to changes in laws or social stigmas related to the actual firearms themselves. Our products will be acquired through established and internationally-known manufacturers, ensuring a high level of quality and value to all of our customers. As Stated in the summary we intend to be the “Wal-Mart,” The depth and range of our products and services will be extensive as to set us apart from our competition. Due to the fact that we offer so many different products and services we will be able to offer them at lower prices than our competitors. To advertise we will have booths at the many local firearm trade shows that are held throughout the year. We will run ads in the local papers and online.

Section 7: Location Analysis

I will need to purchase a lot and have a building constructed to suit the needs of my business.
The building will need to have an indoor firing range of at least 3,500 square feet with ten lanes and a maximum distance of fifty feet, a sales floor of at least 1,000 square feet to display merchandise and conduct transactions, a workshop of at least 700 square feet to accommodate machining equipment and gunsmithing and customization needs, an office space of at least 300 square feet for financial work and records keeping, and a couple of classrooms of at least 500 each square feet each for firearm education classes, totaling 6500 square feet. If this is not an option then I will have to find an existing building that may be remodeled to suit my
needs. Suggested location is a vacant undeveloped commercial lot at 80th w. and 7200 s. in Midvale Less than a block from a UTA Trax station, State St. and the I-15 Freeway on and off ramps, ensuring a lot of pedestrian and vehicle traffic. Other notable nearby locations are The South Towne Exposition Center about three miles away, which is the usual location of the Utah Gun shows. (Google maps, 2013)

Section 8: Manufacturing plan

The minimum building size should be no less than 7000 square feet to accommodate the facility needs stated above. The equipment needed will be * Sales floor – Display cabinets Shelving Registers computers for background checks * Workshop - general machining equipment such as a 12x36 geared head lathe, standards bore brushes, screw drivers welding torches, protective gear and reloading benches * Office – computers for inventory control, financial data and record storage. * Classrooms – desks and chairs video projectors whiteboards. * Firing Range – Electric target pulley system

Section 9: Appendix

Google Maps. (2013, April 16). Retrieved from Google Maps: http://maps.google.com/maps?hl=en&tab=wl