Southeast Racing
Company Summary
Southeast Racing Parts is a new company, which upon commencement of operations will provide entry-level oval track racers with affordable products and quality service.
2.1 Company Ownership
Southeast Racing Parts is a North Carolina corporation, subchapter S, owned entirely by Tim and Molly Jones.
2.2 Start-up Summary
Our start-up costs are listed on the following page. Major costs include computer hardware, software and setup support; rent, a telephone system, approximately office equipment and furniture, parts shelving and other warehouse equipment, leasehold improvements, and a company pick-up truck.
The company will start out with about three months’ inventory on hand. This means the majority of company assets will consist of inventory and the starting cash balance will not be significant.
You will find that we will need additional funding. The purpose of this plan is to secure financing for that amount.
Later in this plan, when you view the Projected Balance Sheet, Projected Cash Flow and the Projected Profit and Loss, you will notice that we do not show any debt or interest expense. However, by examining these same charts, you will see that we project a sufficient amount of earnings to service a debt load.
Upon negotiations of debt amount and terms, modified charts will be provided upon request.
| Start-up | |
| Requirements | |
| Start-up Expenses | |
| Decals | $725 |
| Rent | $1,600 |
| Stationery, forms, etc. | $300 |
| Total Start-up Expenses | $2,625 |
| Start-up Assets | |
| Cash Required | $1,000 |
| Start-up Inventory | $50,000 |
| Other Current Assets | $0 |
| Long-term Assets | $29,000 |
| Total Assets | $80,000 |
| Total Requirements | $82,625 |
| Start-up Funding | |
| Start-up Expenses to Fund | $2,625 |
| Start-up Assets to Fund | $80,000 |
| Total Funding Required | $82,625 |
| Assets | |
| Non-cash Assets from Start-up | $79,000 |
| Cash Requirements from Start-up | $1,000 |
| Additional Cash Raised | $0 |
| Cash Balance on Starting Date | $1,000 |
| Total Assets | $80,000 |
| Liabilities and Capital | |
| Liabilities | |
| Current Borrowing | $0 |
| Long-term Liabilities | $0 |
| Accounts Payable (Outstanding Bills) | $2,000 |
| Other Current Liabilities (interest-free) | $0 |
| Total Liabilities | $2,000 |
| Capital | |
| Planned Investment | |
| Personal Investment | $80,625 |
| Other | $0 |
| Additional Investment Requirement | $0 |
| Total Planned Investment | $80,625 |
| Loss at Start-up (Start-up Expenses) | ($2,625) |
| Total Capital | $78,000 |
| Total Capital and Liabilities | $80,000 |
| Total Funding | $82,625 |
2.3 Company Locations and Facilities
Southeast Racing Parts will be located at 123 Main Street, Anytown, North Carolina. This location will afford us good visibility along with convenient access for traveling race teams wishing to stop at our location.
Another advantage of this location is the recent announcement of a go-kart/entertainment complex, which will be located directly across the street. This complex will attract many potential customers to our immediate vicinity.
By locating in close proximity to Charlotte, Southeast Racing Parts will enjoy a large built-in customer base. The skyrocketing popularity of NASCAR Winston Cup racing in the last 15 years has only strengthened its role as the hub for most race teams and all the related businesses they’ve spawned.
The sport’s explosion has been so boundless that University of North Carolina-Charlotte researchers conducted a study of the industry to try to determine its impact. The study, completed in December 1996, found that in its surrounding counties, NASCAR racing is responsible for about 2,000 jobs producing more than $200 million in expenditures annually — figures that many in the industry consider conservative in 1998. Many of the people employed within the industry along with their children, other relatives, and friends, take up racing as a hobby.
Another benefit of the area is that it is centrally located on the East Coast. The Carolinas and parts of Virginia and Georgia will have the benefit of overnight UPS ground service. A large portion of the East Coast and Southeastern United States would be serviced in two days by UPS ground service.
The Facility
We will initially be leasing 3,000 sq. ft. of a new 10,000 sq. ft. building. As needs dictate, our office and/or warehouse facilities could be expanded into an additional 2,500 sq. ft.
We will be sharing this facility with another business that is also involved in racing, and their business attracts many of the local racers. In light of this, we will meet many potential customers simply because of our association with them.
This location will consist of a showroom, office space, and warehousing. All deliveries and shipments will be serviced at this location. We will also have ample parking available.
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