''BUSINESS PLAN'' help needed

bk1991

hi
i am 18 and want to start out contracting in agriculture cutting hedges and trailer work etc .... the banks want a business plan before they will talk money ... what is a business plan ????? lol i never liked skool so am puzzeled if any one can help please do


bk1991

Axwell

Link

Good place to start, then come back here for specific advice maybe.

patftrears

bk1991 wrote: »

hi
i am 18 and want to start out contracting in agriculture cutting hedges and trailer work etc .... the banks want a business plan before they will talk money ... what is a business plan ????? lol i never liked skool so am puzzeled if any one can help please do


bk1991

Go to your local http://www.enterpriseboards.ie/index.aspx arrive there and say I want to have a chat about staring a business. Get them to spend a few hours with you going through it.


Business plan for you.

Market Analsis:
Who will use your services. (farmers, etc)
Who are they currently using. (competitors, doing it themselves other comapnies)
Why will they use you. (how are you better than teh competitor)

Sales & marketing:
How will you get the word out baout your service. (call around to farmers etc)
How much are you going to charge.
How big will the jobs be, income per job.
Ho many sales will you need each week month etc.

Operations:
What equiptmet do you need.
Do you need staff can you do it on your own, what happen if you need help do you have some one youc an call.

Management Team:
About you, only young be say you how you know the sector, do you have friends family with experience in the sector that can help you. Get a mentor of the enterprise boards.

Cost:
Equipment
Salary
Insurance
Etc..

VS

Sales

So you know your setup costs and loan repayments. Figure out how much sales you need to break even and start making a profit.

You might get some on http://www.talenttank.ie/ to do it for you, I've done lots of business plans and once you know how to write them it's easy to do for any business. Someone over there should have experience and be able to help you.

Atwork

Have a look at the AIB website. Search Business plan. You will find a word document with tips on information required. All you need to do is fill in the info. I found it great.

patftrears

Atwork wrote: »

Have a look at the AIB website. Search Business plan. You will find a word document with tips on information required. All you need to do is fill in the info. I found it great.

that template is way over the top for this.
Stick to the format above I gave you.

First thing:
Why do people want to get their hedges cut, might seem obvious to you, I don't know why. Bank manager probably won't, so explain it basically and simply.
What is trailer work ?

Second Thing:
Go around and talk to a few farmers who you think would be your potentical customers. Just have a chat tell them what you're planning.
1 Ask do they think they would need your service ?
2 Ask them why ?
3 What are they currently doing to cut hedges, trailer work ?
4 How much do they thing they would be willing to pay ?
5 How many jobs do they think they would have for you each year ?

This is market research and will help you see if there is a viable business before you have to spend a penny. A business plan is about putting this information on paper in a way everyone can understand.

GettingThere101

Hello,

Just like to add a few thoughts to the already accurate and helpful discussion from previous posters, from the point of the Bank Manager himself.

Was at a conference the other day called think2act (think2act.org) for the recently unemployed and people starting their own business.

One of the speakers was AIB's Damien Young, head of Small Business Banking. He said a few things relevant to this discussion:

1: The business plan is for the business owner not the bank. It is to demonstrate to the bank that the owner knows the key attributes to making their business a success, ie that there's a market & it's size / the main competition etc as discussed by previous posters. Bottom line is by going through the business plan stages and answering the questions you'll know a lot more about the chances of your business being a success.

2: They'll look at you personal banking history and your record of repaying debt before. So the best bet but not exclusively is to head first to the bank where you do your personal banking as you already have a record and a relationship there. But feel free and don't be shy about shopping around either. In essence they're looking to see if you're likely to pay back the money.

3. They don't just look at the business they look at you. Following from point 2. Are you the sort of person that can answer their questions, that they can have a conversation with, that if you miss a repayment, can come in and have a chat with and not disappear for months on them. That there's a certain amount of trust and dialogue between you.

4. That there's sufficient margin for error in the business. Basically that if you don't get a few key jobs or your costs go up and so on, that's there's enough room to still be profitable and for you to succeed. This is an important one as they know nobody really fulfills their financial projections, and they now unforeseen problems and costs arise, therefore they want to know you can weather those storms.

5. They also take into account their collateral in you. If you're asking for a fortune but putting only a tiny amount of your own cash or assets into the project this will not look well. But for example, should it go under, are you trained in an area where you could get work and pay the loan back anyway.

Basically the message was very positive. They want you to succeed, they want to succeed with you and have their loans repayed and give you bigger loans in the future. That's how they make money anyway.

Hope this was of use!

Thanks for that post GettingThere, from someone who literally stepped off a plane yesterday after being away for 8 months "travellin da world" - one thing that instantly hit me from a media perspective is how bloody bad the recession in this country is - talk about making things harder.

Anyway, your post gave me more encouragement, not that I don't have any as it is, but you can never have too much encouragement. Thanks for that.

GettingThere101

Hey,

Was in Berlin myself and they barely mention the dreaded 'R' word. Dead right, this country is obsessed, and i mean properly every other article on tv, radio and print news obsessed with the recession and doom, gloom and misery.

It's bad alright, but knowing every other minute of the day how bad it is does know one any good. Probably cause most of us are more or less completely powerless to the governments decisions and so on.

For the last six weeks odd i've been on a nearly complete media free diet and my health, positive and constructive advances in building my company have been noticeable. I scan the headlines so i'm not completely out of touch but other than that forget about it.

But look at the bright side, as Frankie used to say, 'if you can make it here, you can make it anywhere..."

If you want a challenge on the business front, in this economy you found it. But feck it, in my situation i really don't have a choice as no one else will hire me and no one else will throw cash in my bank account!

byrne0f56789

Banks are not lending right now. Even established businesses can't get loans. However, I would stay away from bank financing for most start ups. Business plans are not worth anything if you don't have traction and are making sales.

Borrow the tools you need and start getting work. Just do it. Don't rely on the bank.

Put a business plan together but don't spend too long at it. Focus on getting some early sales first. Just use your common sense.

patftrears

byrne0f56789 wrote: »

Banks are not lending right now. Even established businesses can't get loans. However, I would stay away from bank financing for most start ups. Business plans are not worth anything if you don't have traction and are making sales.

Borrow the tools you need and start getting work. Just do it. Don't rely on the bank.

Put a business plan together but don't spend too long at it. Focus on getting some early sales first. Just use your common sense.

Banks are lending to startups, but you will need a business plan.
A good business plan is based on common sense and is a guide how to run your business. Took me 5 business plan to understand that.
Don't get one of the template and try and figure out how to fill in the details.
"Focus on getting early sales" put this in the business plan how am I going to get my first sales. For the OP it's about calling to local farmers. That is what you put in the business plan. Simple practical and it will work.

A good business plan should be light weight and easy to read. Too many people try and over complicate their business plans to try and impress people.

Bandara

byrne0f56789 wrote: »

Banks are not lending right now. Even established businesses can't get loans. However, I would stay away from bank financing for most start ups. Business plans are not worth anything if you don't have traction and are making sales.

Borrow the tools you need and start getting work. Just do it. Don't rely on the bank.

Put a business plan together but don't spend too long at it. Focus on getting some early sales first. Just use your common sense.

Thats not correct.

I have secured a significent amount of funding, and a €50k overdraft, and 2 letters of credit for quite large amounts from BOI this week.

There was no issue whatsoever.

stepbar

GettingThere101 wrote: »

One of the speakers was AIB's Damien Young, head of Small Business Banking.
!

Just to clarify, Damien Young is from BOI.

Hammertime wrote: »

Thats not correct.

I have secured a significent amount of funding, and a €50k overdraft, and 2 letters of credit for quite large amounts from BOI this week.

There was no issue whatsoever.

I'm sure Hammertime that you've provided a significant amount of security to obtain the facilities you needed. However, that being saying I'm sure your proposal was grounded in reality TBH. Some are not.

patftrears wrote: »

Banks are lending to startups, but you will need a business plan.
A good business plan is based on common sense and is a guide how to run your business. Took me 5 business plan to understand that.
Don't get one of the template and try and figure out how to fill in the details.
"Focus on getting early sales" put this in the business plan how am I going to get my first sales. For the OP it's about calling to local farmers. That is what you put in the business plan. Simple practical and it will work.

A good business plan should be light weight and easy to read. Too many people try and over complicate their business plans to try and impress people.

+ 1 to that. Cash flow / projections would be important to have also.

OP to be realistic you will probably need backing from someone else (i.e. someone who could guarantee you or put up security). I seriously doubt the bank would give you 100k+ to buy new machinery. Coming from a farming background, I know that decent machinery of any kind is not cheap (unless you pick up stuff in auctions and god knows what sh1te you'd find there). In addition farm incomes are dropping and realistically you'd be really up against it. However it all depends on who else provides a similar service in the area and your price, because lets be honest there's no particular skill in cutting meadows, spreading muck etc.

BizTalker

byrne0f56789 wrote: »

Put a business plan together but don't spend too long at it. Focus on getting some early sales first. Just use your common sense.

I would disagree on that. Without proper business planning your business would not go far.Throwing everything into the start up just to take off isn't good idea at all. You would have to consider every single detail, to explore your markets, your rivals first, your business potential, then start pumping money into it. Do not borrow and invest before your initial planning!

Bandara

stepbar wrote: »

I'm sure Hammertime that you've provided a significant amount of security to obtain the facilities you needed. However, that being saying I'm sure your proposal was grounded in reality TBH. Some are not.

Yes my proposal was as solid/safe as you can get, but I was only required to put up a third of the overall amount in the form of a cash lodgement that the bank have locked away for me into one of the high interest savings accounts.

The fact is the bank did stump up with 66% of the investment/startup costs, so for the previous poster to say they are not releasing funds to established business is not correct.

bk1991

patftrears wrote: »

Banks are lending to startups, but you will need a business plan.
A good business plan is based on common sense and is a guide how to run your business. Took me 5 business plan to understand that.
Don't get one of the template and try and figure out how to fill in the details.
"Focus on getting early sales" put this in the business plan how am I going to get my first sales. For the OP it's about calling to local farmers. That is what you put in the business plan. Simple practical and it will work.

A good business plan should be light weight and easy to read. Too many people try and over complicate their business plans to try and impress people.

ok equitment i will need is as follows
tractor will be 20k
hedge cutter 10 k
trailers/lowloaders would be 5k
slurry tank 7k
agatitor 2k

these figures is not acurite there only rough geuss i would prob get em cheeper plus if i can regester for vat id be able get em even cheper
theres deisel and insurance costs to be added aswell


my market would be farmers or public in general
anyone who has a hedge on a public road will need it cut every year for road safety etc there is one guy in my area doing this already which i will be competeing against i will be chargeing 35 euro an hour for hedges and could do from 8 in more till 9 or later that night if i got the work which would be say make 455€ in a day of good going
then lowloader work and haulage would be same as any guy with a fat trailer on a truck but id be able get away with green deisel so id be cheeper

i was thinking i would promote my self by sing write on my equitment aswell as calling to farmers with flyers or business cards



how do i make a buisness plan out of this this is not a job where i can say i will get a job and will do so many jobs in that time ie weather .breakages etc
is there any where that does this for small fe

bk1991

conman

im curious, with regards a business plan..

1. do people simply print out on A4 paper and add it to a smart looking folder?
2. do you make them as a .pdf and present a file/or slideshow to your investors?
3. or do you go for the glossy professional look and have your plan printed out professionally by a printing firm?

I was thinking a mix of 1+2..

You can get it bound professionally for under 10 Euro. (at least you could when I was in College 2 years ago)

I found when presenting plans etc in college, best thing to do is give handouts to the judges/people critiquing your plan and then present your business plan/the key points (what your idea is, how much you're looking for, etc etc) using no notes and standing away from the podium. People find it hard to do but if you can nail that, you look good.

antoinolachtnai

Here are the things to think about.

Is there really enough work to be done? How will you get it? Business cards and flyers aren't really going to cut it in a rural area where people already have suppliers they depend on. You have to have relationships with these people to convince them to take the business away from the other guy and give it to you.

It's about 50k's worth of gear all-told, and you would be making payments of 1500 or 2000 a month. Are you really sure there is enough margin (profit) in the business, when everything is taken into account (paying yourself, paying tax, paying staff, paying insurance, renting a yard, paying a bookkeeper and accountant, etc)?

I would try to think of ways of avoiding having to make a capital outlay at the beginning. Is there any way you can rent or borrow this equipment?

Is there any existing local operator, perhaps someone who is contemplating retiring, who you could work with and whose business you could take over in a few years?

This is what business planning is all about.

JohnThomas09

bk1991 wrote: »

my market would be farmers or public in general
anyone who has a hedge on a public road will need it cut every year for road safety etc there is one guy in my area doing this already which i will be competeing against i will be chargeing 35 euro an hour for hedges and could do from 8 in more till 9 or later that night if i got the work which would be say make 455€ in a day of good going
then lowloader work and haulage would be same as any guy with a fat trailer on a truck but id be able get away with green deisel so id be cheeper

sounds like a risky enough plan,there's less and less farmers doing work on the farm this year because no body knows where farming is going these days with the budget cuts.Also your location is key,i live in the North West and around here most Agri-Contractors are getting out of the business.Also i don't see why you would need to buy a low loader,surely anyone who wanted something hauled would get a lorry,much quicker and can carry heavier loads.I'd think long and hard about this before i invest any money.My advice would be start small,buy yourself a tractor and slurry tanker to start off with and see how it goes,don't buy all the machinery in the first year.

random.stranger

Hi OP,
Looks like a lot of your work will be seasonal. You might want to look at how you will keep the money coming in over the winter months (or have plenty stashed from the summer).

Best of luck with it.

bk1991

thanks for all the advice so far . the work will be say hedges in winter from august to feb .and slurry from jan to oct which will work ok then haulage any time
i woulnt be hireing any staff i would have the yard here at home
there is one guy here already doing the wokr that i would like to do
i dont know how id take the jobs from him ...but theres some way .
farming is not good at this time but what is .farming i think will get better in a year or too beacuse what other jobs will be done

has any of ye done anything like this at my age


a simple buisness plan is what like in bullet points what is it ???

JohnThomas09

bk1991 wrote: »

farming i think will get better in a year or too beacuse what other jobs will be done

has any of ye done anything like this at my age

i admire your enthusiasm at such a young age.I never took on such a venture but i know someone who did.Around three years ago he left school at the age of 18,his father had recently passed away and left him a legacy of money(a great start).He bought a Tractor,Slurry Tanker,Agitator,Conditior Mower and Hedgecutter.There was already a few locals that was doing agri-contracting.Long story short he is getting out of the business,since the recession he has found it impossible to collect money.He spent 6 weeks of the summer mowing and hasn't seen a penny yet.He is still owed for mowing for last summer.

The problem your going to be faced with is you will have monthly payments that have to be met and if you can't collect the money how are you going to pay.If you hound your debtors you'll get a bad name for it.The advantage the your competition has is the have Business set up and having probably being paying their bills on time during the good times and they won't be under as much pressure from their Banks.Sorry to he so blunt about it but i cant see it going to plan for you.

GettingThere101

bk1991 wrote: »

ok equitment i will need is as follows
tractor will be 20k
hedge cutter 10 k
trailers/lowloaders would be 5k
slurry tank 7k
agatitor 2k
bk1991

That's 44k odd just for the equipment alone. Is there a possibility you could rent or borrow some of that equipment until you're making cash?

It could mean you could get going for a great deal less investment of capital and have a lot less debt to pay back should the business not take off. Also it could mean you'd only have the equipment costs every time you do a job and not be paying for them when you have days or weeks down time between jobs.

Also I agree with a previous poster, it might not be a great idea to go to the bank for money if you can otherwise avoid it.

Also it's a lot easier for the bank to invest in you if you're already trading even for a short time. Shows that you can both do the job and get customers.

You can definitely rent all that equipment down the country surely ? No point making the risk bigger than it needs to be - start as small as you can.

Get jobs first, it's not like you're selling clothing or anything where you need to have the product there and then for people to buy, you can get the jobs before you get the equipment (as long as it's possible to rent it) - then rent the equipment, get a reputation and then think bigger and away you go... (or not)

JohnThomas09

Deleted User wrote: »

You can definitely rent all that equipment down the country surely ? No point making the risk bigger than it needs to be - start as small as you can.

Get jobs first, it's not like you're selling clothing or anything where you need to have the product there and then for people to buy, you can get the jobs before you get the equipment (as long as it's possible to rent it) - then rent the equipment, get a reputation and then think bigger and away you go... (or not)

where can you rent the equipment?do you have any contact links??

bk1991

JohnThomas09 wrote: »

where can you rent the equipment?do you have any contact links??

the is a company in meath called all plant that hires diggers,tractors,dumptrailers,etc not hedge cutters
tbh hireing the equitment woulnt work .haveing it there to just go do a job woulnt be possable...where else apart from banks would ye recomend
i can get the tractor for definitaly under 20 k thats for a 00 ..id need sped good for tractor after all thats where id be all day . then the hedge cutter will be definitaly 10k i would get od jobs for the tractor around the year like hauleing silage for other contractors .plus hopefully this big airoport being built near me in midlands so hopefully id get work there too


how do i go on from here

Why would hiring the equipment just not work ?

It's the same as owning it except you are significantly reducing the financial risk - you're testing the market.

You can always buy it afterwards when you actually have jobs to do.

OP - a couple of thoughts

Banks are giving out funding but only to people with a track record. The amount or risk they are taking has dropped significantly. Unless you have someone to give a personal guarantee on it that has a good track record Id say theres no point putting yourself through the annoyance and disappointment.

Putting a business plan together is a good move either way. Here is how I would structure it:

Executive summary - What is your plan and your goals
Personal Summary - who are you, what have you done
Market analysis - whats going on in the market right now?
Your edge - why you can do this well
Competition - find out about them and get all the info you can about what they are doing, how you can better it, costs, prices etc
Strengths - have you any strengths at the moment?
Growth Opportunities - where is the growth year on year?
Target Market - who is going to pay you for this?
Finance Required - how much - followed by a breakdown
Sales and Marketing strat. on the back of finance injection
Sales/Revenue/Turnover - 3 years forecast. Not comfortable with numbers? Ask a friend who is, or buy a book and learn how to do a P&L. Its secondary school stuff and you'll pick it up quick.

If you put something like that together you could take it to other avenues of finance who are more risk friendly. That could be cousins, uncles, local businessmen. They might be able to get you a start with 5k even

On the renting/leasing side of things. How much money can you get together right now? Perhaps with your bus plan like i said you could get 5K off someone that would get you a start. If I were in your position I would approach the owners of a few different rent/leasing places. I would say look guys, Im going to start this business (give them a copy of your plan, without the figures) and I want to start off by leasing equipment from you with a view to buying it in a few months/a year once the business has kicked off. What I need from you guys is a price on all the things i need for 1 month. Id appreciate if you could consider giving me a big discount as Im trying to start a new business here, and if you were to help me out now I'll use you exclusively for all equipment purchases/leases in the future, sort of like a partnership.

You might get told where to go asking for discounts. But you might just be likeable enough that the owner of the company might do you a favour. When I was younger I had a few people take me under their wing because they liked the enthusiasm and drive and sometimes people will invest in you as opposed to your business plan.

If you managed to pull that off, then you hit it with everything you have for 1 month. Work all the hours under the sun (and under the moon!). Take stock after a month, you will know Im sure whether its going to work or not. If not your only out the leasing costs for 1 month and a few other small costs which wouldnt be too major

JohnThomas09

bk1991 wrote: »

the is a company in meath called all plant that hires diggers,tractors,dumptrailers,etc not hedge cutters
tbh hireing the equitment woulnt work .haveing it there to just go do a job woulnt be possable...where else apart from banks would ye recomend
i can get the tractor for definitaly under 20 k thats for a 00 ..id need sped good for tractor after all thats where id be all day . then the hedge cutter will be definitaly 10k i would get od jobs for the tractor around the year like hauleing silage for other contractors .plus hopefully this big airoport being built near me in midlands so hopefully id get work there too

i would advise you to take the advice your getting here.as TheEntrepreneur has advised you'd be best hire the equipment if at all possible to start off.Your not going to get finance for such a venture from anyone other than the Banks.Go and talk to a business advisor,it will cost you but he will do your business plan for you,then when you have your business plan,go to the Banks.I wouldn't be gambling on the chance you might get work,id make sure i had at least 6 months of guarnteed work before i even did up a business plan,if you can't show the banks that your business is needed their not going to back your business.