Heavy Equipment Maker Business Plan

TWM will manufacture heavy equipment machinery for all phases of commercial construction needs.  Primary focus will be placed on product engineering and manufacturing processes to ensure the highest quality, a high level of product features, and the most efficient manufacturing process possible.

TWM will manufacture heavy equipment machinery products called the “Widget Basic,” “Widget Deluxe,” and “Widget Premium.”  All Widget products will be capable of lifting 50 tons, and are specially designed to be extremely precise when controlling movement of the various features of the machine.

The Widget Basic will include features including a large “grabber” arm, for tasks such as girder installation and placement, and a back-hoe lifter for land clearance.

The Widget Deluxe will include features including a large “grabber” arm, for tasks such as girder installation and placement, a back-hoe lifter for land clearance, and a wrecker ball attachment for building demolition.

The Widget Premium will include features including a large “grabber” arm for tasks such as girder installation and placement; a back hoe lifter for land clearance; a wrecker ball attachment for building demolition; and an elevating device to lift as many as ten crewpersons up to 10 stories.

3.1 Industry Analysis

The industry is dominated by a few very large companies, such as Caterpillar, Komatsu, Ingersoll Rand, and Linde AG. Of these major competitors, Caterpillar is the largest, with approximately 40% market share. Last year, Caterpillar reported sales of approximately $20 billion and Komatsu, Ingersoll Rand, and Linde AG each reported around $8-9 billion. Each of these giants has large or multisegment marketing strategies that provide general equipment for large blocks of customers.

Companies market their products through established local distributors who are often franchises of the parent manufacturers. There is limited direct sales to very large customers. The advantage of such distributors is the ability to provide financing, rapid servicing and replacement of such equipment as well as providing close relationships between customers and service providers that allows for maximizing equipment usage.

Customers who purchase such equipment require reliability, rapid servicing/availability of parts, and versatility for a variety of anticipated and unanticipated uses. Customers are influenced by reputation and cost, since equipment purchases can be the most significant portion of the customer’s long-term assets.