Lacy Grambo Logan Gray. Increasing trend for people today to go green Going green can save...

Lacy GramboLogan Gray

Increasing trend for people today to go green

Going green can save consumer hundreds of dollars each year

Problem:◦ Many people don’t know where to begin◦ Are not aware of incentives and grants

available◦ Need to do a lot of research, takes a lot of

time

Opportunity

The Solution

All-in-one hardware and building supplies retailer◦ Appliances◦ Electrical & Lighting◦ Plumbing◦ Paint◦ Flooring

Focused on offering ecologically friendly products and service

The Business

Professional advice◦ Renovation options◦ Government grants◦ Tax incentives◦ Financial analysis

Professional installation service Convenience

◦ Location◦ Customer Service

The Business

Future Goals and Expansion Plan:◦ Planning to Franchise in year 5◦ Planning to offer an in store Credit

Program in year 7◦ Ongoing search for expanding

product line

The Business

Capital InvestmentFixed Capital

Land 52,083

Buildings 3,451,323

Furniture & Fixtures 45,000

Vehicles 50,000

Total 3,598,406

Working Cash Flow 162,206

Total Capital Investment 3,760,612

50% Debt Financing: $1,880,306 50% Equity Financing: $1,880,306

Projected Income Statement

For the year ended 2011 2012

Sales 3,850,000 4,123,350

Gross Profit 1,309,000 1,401,939

Total Operating Expenses 943,696 1,050,201

Net Income 365,304 295,116

If the average home was fully upgraded and became energy efficient, they would save at least $900 a year

Projected Income Statement

For the year ended 2011 2012

Sales 3,850,000 4,123,350Percentage of Area Utility Savings 9.5% 10.2%

Gross Profit 1,309,000 1,401,939

Total Operating Expenses 943,696 1,050,201

Net Income 365,304 295,116

Analysis Required ROI: 15% Dividends paid to maintain

$500,000 cash balance

IRR: 30% ERR: 21%

Conclusion High Risk

Medium Return

Feasible◦ Potential for long-term

growth and expansion◦ Requires large

investment◦ The first store of its kind ◦ Meets the growing need

to go green