Interstate Travel Center
Company Summary
Interstate Travel Center is a start-up company whose management perceives a growing demand for commercial vehicle services within the Dallas area. The company’s management staff includes Steven Smith, who has extensive experience within the automotive repair industry, and Janet Smith, who has provided budgeting and bookkeeping services to small companies for twenty years, who will provide the logistical support for the business. It is Interstate Travel Center’s long-term goal to create multiple service centers within the southwest area to service the NAFTA commercial traffic and create a brand awareness that transcends state borders.
Location:
Interstate Travel Center will be located between I-45 and I-635 in Dallas, Texas. Access to the travel center will be through these major highways. The advantages of this site are listed below and should be evaluated accordingly when investments for site developments (or improvements) are being considered.
- Visibility of this site is considered good.
- Competition at and around this location is low.
- Quantity of competition is classified as limited.
- Accessibility to location is good.
- Traffic count potential (during rush hour traffic) at this location is considered good.
- House count at this location is very low.
- Demographics at this location are excellent.
- Growth of area around this site is fair.
2.1 Company Ownership
Interstate Travel Center is solely owned by Steven and Janet Smith. It is not anticipated that the company will seek additional shareholders for the foreseeable future.
2.2 Start-up Summary
Funding Requirements and Uses
The initial start-up costs will amount to $2.75 million. This will be used to purchase land, develop it, and construct a 6,000 sq./ft travel center, complete with gas/diesel islands, scales, and a restaurant. The initial capital injection will be $250,000. The remaining will be funds in the form of a $2.5 million loan. Figure 1 provides a breakdown of how the funding will be used and Figure 2 provides the Expenditure Outline for Phase I.
Figure 1. Use of Funds
Working Capital | $250,000 |
Inventories (Travel Ctr.) | $65,000 |
Land | $200,000 |
Land Development | $150,000 |
Highway Improvements | $350,000 |
Building | $500,000 |
Pre-Paid Expenses | $250,000 |
Gasoline Facility | $200,000 |
Diesel Facility | $150,000 |
Equipment (Travel Ctr.) | $100,000 |
Equipment (Restaurant) | $200,000 |
Contingency | $235,000 |
Other fixed Assets | $50,000 |
Scales | $50,000 |
$2.75 million |
Figure 2. Phase I Expenditure Outline
Land Development | $100,000 |
Building (6,000 sq. ft.) | $500,000 |
Gasoline Facility (includes all equipment) | $200,000 |
Diesel Facility (includes all equipment) | $150,000 |
Equipment: Store | $100,000 |
Equipment: Restaurant | $200,000 |
Highway Improvements* | $50,000 |
Miscellaneous | $50,000 |
Land Costs | $200,000 |
TOTAL ALLOWABLE BUDGET FOR PHASE ONE | $1.55 million |
*Texas Department of Transportation – 50/50 split with state.

Start-up | |
Requirements | |
Start-up Expenses | |
Prepaid Expenses | $250,000 |
Travel Center Equipment | $100,000 |
Restaurant Equipment | $200,000 |
Contingency Costs | $235,000 |
Other | $0 |
Total Start-up Expenses | $785,000 |
Start-up Assets | |
Cash Required | $250,000 |
Start-up Inventory | $65,000 |
Other Current Assets | $50,000 |
Long-term Assets | $1,600,000 |
Total Assets | $1,965,000 |
Total Requirements | $2,750,000 |
Start-up Funding | |
Start-up Expenses to Fund | $785,000 |
Start-up Assets to Fund | $1,965,000 |
Total Funding Required | $2,750,000 |
Assets | |
Non-cash Assets from Start-up | $1,715,000 |
Cash Requirements from Start-up | $250,000 |
Additional Cash Raised | $0 |
Cash Balance on Starting Date | $250,000 |
Total Assets | $1,965,000 |
Liabilities and Capital | |
Liabilities | |
Current Borrowing | $0 |
Long-term Liabilities | $2,500,000 |
Accounts Payable (Outstanding Bills) | $0 |
Other Current Liabilities (interest-free) | $0 |
Total Liabilities | $2,500,000 |
Capital | |
Planned Investment | |
Steve Smith | $150,000 |
Janet Smith | $100,000 |
Other | $0 |
Additional Investment Requirement | $0 |
Total Planned Investment | $250,000 |
Loss at Start-up (Start-up Expenses) | ($785,000) |
Total Capital | ($535,000) |
Total Capital and Liabilities | $1,965,000 |
Total Funding | $2,750,000 |