Business_Plan

North Carolina Wesleyan College Bus 370 Small Business Management Holmes Cleaning Service Business Plan Angela Holmes Dr. Robert Kasey 10/10/11 Honor Statement I wrote this paper on my own. I did not have any help and have never turn in this paper before. Print name Signature Date Mission Statement Holmes Cleaning Service's mission is to provide the customer with all residential cleaning services in an environmentally sound, completely trustworthy, and professional manner. We exist to attract and maintain customers. When we adhere to this maxim, everything else will fall into place. Our services will exceed the expectations of our customers. Objectives Holmes Cleaning Service's objectives for the first three years of operation include: •To create a service based company whose #1 goal is exceeding customer's expectations. •To increase our number of clients served by 20% per year through superior service. •To develop a sustainable home-based business, living off its own cash flow. •The utilization of Holmes Cleaning Service on a regular basis by at least 30% of the leads that contact us for more information. Mission Holmes Cleaning Service (HCS), located in Goldsboro, NC, will offer residential home cleaning services. HCS will offer a wide range of services to the residential client, from general room cleaning to child/pet disasters. We will be going after the upper end of the market, typically the affluent whose spouse does not have a full-time job but chooses to do other things with his/her time, or the two income family who chooses not to clean the home themselves. Company Ownership The business will be based out of Angela Holmes’ home. Angela will be responsible for scheduling, estimates, and customer care management. The business organizational type will be a sole proprietorship, owned by Angela Holmes Start-up Summary Holmes Cleaning Service's start-up costs include equipment needed for a home-based business, initial legal fees, marketing fees, cleaning equipment and supplies. The legal fees are used for the formation of the business as well as reviewing/generating client contracts. Marketing fees are for the production of business cards and brochures. Cleaning equipment must also be purchased vacuum cleaner and assorted brooms, mops, and chemicals. Lastly, we will have a few magnetic company signs made to turn my car into the appearance of a company car. Services Holmes Cleaning Service will provide a residential house cleaning service for the upper end of the market. We will have two target customers: 1. The affluent that has a spouse who does not work, but is not inclined to do housework. To many a maid/house cleaner is a symbol of wealth, and this idea symbolizes this group of customers. 2. The two-income households whose opportunity costs are too great to spend time cleaning the house. HCS offers house cleaning to these targeted customers. House cleaning ranges from cleaning of standard rooms such as kitchen, bathrooms, bedrooms, as well as more unusual jobs like small disasters from children and pets. Market Analysis Summary Holmes Cleaning Service will target the upper end of the house cleaning market. It would appear, at least if you opened the yellow pages, that there is not a need for another house cleaning service. Make no mistake however; there is a need for a quality, honest service. HCS is offering a high quality, totally trustworthy service for high income households. We are perfectionists and this will be clear by our service. Goldsboro, NC currently has quite a range of different residential house cleaning services, from independent companies to franchise services. No one else is specifically targeting the wealthy. We will be targeting two wealthy populations: 1. Wealthy one-income households. 2. Affluent two-income households. Both of these targeted groups appreciate a professional, reliable, trustworthy, cleaning service and are willing to pay a premium to get this top shelf level of service. We will be marketing our service to these people through word of mouth referrals. Goldsboro, NC, like most cities, has lots of cleaning services. Although there are lots of competitors, we are the only company to go after the upper socio/economic class exclusively. Demand for an upper-end cleaning service will allow us to have steady growth. Market Segmentation Holmes Cleaning Service will be focusing on two upper socio/economic groups. The first is the affluent where only one spouse works. Although the other spouse is at home and has time to clean, he/she chooses not to. This spouse would rather volunteer for a public interest organization, play tennis and golf, or just spend time how he/she chooses to. They have no desire to clean the house. To them that is not enjoyable and they have the money to pay someone to do that kind of work. This market has annual incomes over $200,000 and lives in expensive houses. While Goldsboro NC, has quite a few families that fall into this category, this group reliably uses cleaning services. (Schenck, 2005). Our second segment of the market that we are targeting is the two income family. Over the last couple of decades, the number of two-income households has increased, to a point where in parts of the country they exceed one income families. Our target customer is two income families whose combined annual income is over $125,000. These families don't really have the time to clean, can afford a cleaning service, and choose to hire a service because the opportunity costs are too high to waste time cleaning their house. These households are typically age 32-55 and live in houses valued over $250,000. Goldsboro and surrounding counties has approximately 10,000 families that fall into this demographic. It is this segment which has tremendous potential for us. Nearly 80% of dual income households use an outside cleaning service for some of their house cleaning according to the U.S. Department of Commerce. Target Market Segment Strategy HCS is focusing on these people because they appreciate a professional, reliable, trustworthy, and immaculate house cleaning service, and are more than willing to pay for this. While Goldsboro, NC, has several different cleaning services, we are the only one that targets the affluent exclusively. The wealthy are consistent customers. Whether they have a house cleaning service does not depend on the finances each month. These groups always have the money for our services, just as they always need/desire a clean house. The affluent desire quality and are willing to pay a premium for a service that that they can trust 100% that extrudes professionalism, and basically allows them to forget that they have to deal with whatever it takes to get a clean house. We do all of this in a seamless, customer centric manner. We will market our company through a two-pronged approach. One prong is the distribution of a color brochure detailing our services. The distribution of this document will be targeted to hit our chosen segment. This will be done by setting up strategic relationships with organizations or clubs whose members fits our targeted customer profile. Examples of this would be higher-end athletic clubs, country clubs, wine connoisseur clubs, etc. We will gain access to these clubs membership through deals where the club owners will receive our services for themselves to test the quality so they then feel comfortable with helping us by being a "cheerleader" for our service. The second prong of our approach will be through word of mouth referrals. We will offer an economic incentive (such as a free visit) to our customers if they bring in new business for us. We believe this will be effective because the financial incentive will motivate their behavior, and people naturally like to share good things with their friends. Competition and Buying Patterns Although there are lots of competitors in the cleaning service space, there is good reason for this competition, demand is high. Plenty of maid/janitorial services have waiting lists; they are unable to meet demand. Additionally, many of the maid and janitorial services are "mom and pop" operations without enough employees. Cleaning service customers want quality, and not everyone in the cleaning service space offers quality. How often when you ask one of your friends for a referral do they tell you they have been using a bunch of different companies and they have yet to find one that they are truly happy with. The residential house cleaning niche is a subset of the larger cleaning business. Within the cleaning business, there are both residential as well as commercial cleaners. The commercial cleaners are typically a janitorial service that offers a wide range of services from general office cleaning, to carpet cleaning, to window cleaning. Janitorial services are a one-stop service offering for commercial businesses. There are also residential cleaning services. The residential house cleaning market is serviced predominately by independent companies. There are however, a few large franchises. Residential services are divided into a couple of different categories, maid or house cleaners, carpet cleaners, window cleaners, and a variety of other services that are required on a less frequent basis. They are far more restricted in their range of offered services relative to the commercial janitorial services. We charge a premium for our services, and people are willing to pay to get our unsurpassed level of professionalism, trustworthiness, and attention to detail. We provide the most pleasant experience possible. Strategy and Implementation Summary Holmes Cleaning Service will be courting the high income families in Goldsboro, NC. We will be attractive to these customers because of our commitment to professional, trustworthy service. We will achieve this high level of service through extensive training and a continuous learning process. HCS will be qualifying leads over the phone with estimates and more importantly, with in-house meetings. This sales strategy should yield a steady increase in jobs starting from month two. (Abrams & Kleiner,2003). Sales Strategy The sales process will begin through the qualification of leads generated from our marketing campaign. The marketing campaign will primarily generate leads through interest sparked from our brochures. Someone will call to receive more information about our service, while we will be able to give them an estimate over the phone, we would prefer to be able to get into their home and speak with them. On one hand we would be able to offer them a more accurate estimate. More importantly however, it provides us an opportunity to impress them with our company. We feel confident that since we are dealing with the affluent, who for many services are less price sensitive, are more likely to be impressed with our professionalism, "feel" an immediate trust bond forming, and sign up for the service. For those clients whom we are only able to speak with over the phone, we will initially quote them a price. Because they are less price sensitive then the general population, we will then detail why our service is priced a bit higher than most. This conversation will leave the prospective customer the impression that HCS is indeed different from the run of the mill residential cleaning services and that the price differential is justified. Lastly, we will be qualifying the leads by explaining up front that our service is more expensive. This is not a fact that we are trying to hide. We are setting up an expectation for the customer that they can indeed expect more with our service. This "angle" is based on the assumption that many people are not thrilled with their current cleaning service. Sure they clean adequately, but there is not a trust bond formed as if you had the same house cleaner for 20 years who helped raise your children. This is how we will differentiate ourselves and ultimately win over new customers. (McKeever,2005). Sales Forecast The first month will be used to set up the business. We will begin to field inquiries over the phone and expect to turn some of those into contracts. As the number of contracts begins to pick up at the end of the second month an additional person will be hired to form the first employee team. The sales forecast is based on the assumption that increased demand will occur at a steady pace. This is based on the assumption that a large part for our new clients after month two will be from word of mouth referrals. The logic is that we will incrementally gain customers as we continue to serve current customers. We will need a couple of visits before we can turn a new client into a referral service. All this will happen steadily and incrementally. This forecast is on the conservative side, it is possible that because we are superior to competing services that things really take off, however, it would not be prudent to take that aggressive of a forecast. It is always better to err on the side of caution. McKeever, M. P. (2005). How to write a business plan. Berkeley, Calif: Nolo. Abrams, R. M., & Kleiner, E. (2003). The successful business plan: Secrets & strategies. Palo Alto, Calif: ThePlanningshop Allocation and Productivity of Time in New Ventures of Female and Male Entrepreneurs Ingrid Verheul, Martin Carree, Roy Thurik, Small Business Economics,Vol. 33, No. 3 (Oct., 2009), pp. 273-291, Published by: Springer, Stable URL: http://www.jstor.org/stable/40344577 Bands, Kathy. (n.d.). My Cleaning Service, Inc. a business plan for five-year growth strategy. (Schenck, B. F. (2005). Small business marketing for dummies. Hoboken, N.J: Wiley. My Cleaning Service, Inc. a business plan for five-year growth strategy.)