Lawn, Garden and Farming Equipment Retail

Manouchehr Rahmani 2014

Quebec Entrepreneur Programme

Business Plan

ContentsExecutive Summary.....................................................................................................................................3

Background of Applicant.............................................................................................................................4

Market Analysis...........................................................................................................................................4

Industry...................................................................................................................................................5

Target Market..........................................................................................................................................6

Products and Services..................................................................................................................................6

Products..................................................................................................................................................6

Services....................................................................................................................................................7

Company and Ownership Structure............................................................................................................8

Operations...................................................................................................................................................8

Location...................................................................................................................................................8

Suppliers..................................................................................................................................................9

Competition...............................................................................................................................................10

General Description...............................................................................................................................10

Competitive Advantage.........................................................................................................................11

Marketing..................................................................................................................................................12

Promotional Activities...........................................................................................................................12

Advertisement.......................................................................................................................................12

Price.......................................................................................................................................................13

SWOT Analysis...........................................................................................................................................13

Strengths...............................................................................................................................................13

Weaknesses...........................................................................................................................................13

Opportunities........................................................................................................................................13

Threats...................................................................................................................................................13

Personnel Plan...........................................................................................................................................14

Sales person...........................................................................................................................................14

Landscaping Consultant.........................................................................................................................14

Personnel Plan.......................................................................................................................................15

Financial Analysis.......................................................................................................................................15

1 | P a g e

Breakdown of Investment.....................................................................................................................15

Sales Promotion Activities & Advertising Material................................................................................16

Leasehold Improvements......................................................................................................................16

Website Design and Required Software................................................................................................16

Cash Required........................................................................................................................................17

Sales Forecast........................................................................................................................................17

Income Statement.................................................................................................................................18

Balance sheet........................................................................................................................................19

References.................................................................................................................................................20

Appendix.....................................................................................................................................................1

Product Summary........................................................................................................................................1

Farming and Lawn Care Supplies.............................................................................................................1

Gardening and Landscaping Supplies......................................................................................................1

Storage & Tools.......................................................................................................................................2

Power Equipment....................................................................................................................................2

2 | P a g e

Executive SummaryThe proposed business is a new start up, sole proprietorship, wholly owned and

managed by Mr. Rahmani. The business will engage in the retail and rental of garden, farm and landscaping equipment and supplies to farmers, businesses such as landscaping contractors, and home owners in Trois Rivieres, QC either directly from its store or through its website. The provided equipment will be in four main categories: lawn care, gardening, storage and tools, and power equipment. The business will also offer landscape counselling primarily to homeowners who have a low level of familiarity with gardening and landscaping, and prefer an expert opinion on landscaping their lawns and yards. Renting popular lawn and garden equipment as well as providing landscape counseling services will distinguish this business from the competitors in the market.

The aim of the proposed business is to provide one stop shopping for the best quality and environmentally friendly lawn, garden and farming equipment and machinery. The business plans to invest in its website to promote it as a reliable authority in the lawn, gardening and farming information for Trois Rivieres and the surrounding area. The website will also increase the reach of the business beyond Trois Rivieres by playing the role of an online store where customers can order their necessary equipment and tools and have it delivered to their doorstep.

The business plans to sell its equipment and supplies to professionals such as farmers, landscaping contractors, gardening experts as well as amateur lawn and garden enthusiasts. It will supply farming, gardening and landscaping equipment to the local market in, and around Trois Rivieres QC. A number of factors such as low competition relative to the city size, low operating costs, and distance from major cities make Trois Rivieres an ideal location for this business.

The founder will be investing development time, experience, and 100% of start-up costs of $175,000. Mr. Rahmani will be the managing director of this business running its day to day operations and will see to planning, staffing, managing and controlling the whole business. Apart from Mr. Rahmani, the business will hire one full-time employee as a sales person as well as one part-time employee as a landscaping consultant.

Mr. Rahmani has vast experience with cultivation and farming, and during the years as the manager of his vineyards, he has been able to gain valuable knowledge and business skills

3 | P a g e

such as financial, operational, sales and marketing, and human resource management. His background in farming gives him complete familiarity with the equipment and tools in the proposed business and this will give him an edge in the target market.

Background of ApplicantMr Rahmani became the owner and manager of Rahmani’s Vinyards in May 2009 and

has been managing the farm ever since. After graduating in the field of medicine at Shahrekord University of Medical Sciences in 1996, Mr Rahmani was a general physician at Shanestagh Sofla & Nehavand Treatment Center for two years which afterwards he established his own medical office. He was a full time general physician at his office until he became the manager of the vineyard. Now Mr Rahmani manages his vineyards full time.

Market AnalysisEvery year, more and more individuals decide to take up gardening as a way to spend

their leisure time. In fact, gardening is the number one hobby in the US and is among the most popular hobbies in Canada suggesting that beyond the professional market of farmers and landscapers, there is a growing market for gardening equipment and supplies among the amateur enthusiasts.

In the past five years, like many other industries, the lawn, garden and farming equipment retail industry has felt the effects of the recession which increased unemployment rates, and unstable economic conditions led to low disposable income. Consequently, households delayed spending on discretionary products, including lawn and gardening equipment. However, over the next five years to 2019, renewed confidence in the economy and increased discretionary incomes are expected to boost industry revenue.

The lawn, garden and farm equipment industry is highly fragmented and shows low levels of market share concentration. Based on the study by IBISWorld, no single operator accounts for more than 1.0% of the industry revenue. This fact demonstrates that there is no sizable competitor with a dominant market share in this industry and that the majority of businesses are focused on local demand in, and around their store locations.

With the help of the industrial development advisor at Innovation et Développement économique Trois-Rivières, Ms. Julie Cloutier, we were able to gain insight into the lawn, garden and farming market of the city as well as some valuable information about the gardening and farming activities in the area. The table below compares the number of competitors in major cities of Quebec. Relative to its size, Trois Rivieres has a limited number of competitors in the

4 | P a g e

lawn, garden and farming equipment retail business. Its population to competition ratio is about 16,863 which is one of the best among the cities studied for this business.

City Population Nearby major City

Distance from major city (km)

Potential Farm-Lawn equipment Competitors

Population/Competition

Sherbrooke 154,601 Montreal 158 22 7,027

Laval 401,553 Montreal 20 40 10,038Québec 516,622 - - 49 10,543Trois Rivieres 151,773 Québec 126 9 16,863

The distance of Trois Rivieres from major cities (126 KM from Quebec City) means that bigger competitors in Quebec City do not pose a threat to this business and farmers and homeowners in Trois Rivieres need to supply their tools and equipment from the local stores. Due to the fact that Trois Rivieres is a regional administrative hub, the city possesses a large pool of skilled labour which makes it easier for the business to hire experts and professionals in its field.

Another advantage of choosing Trois Rivieres as the city to operate for this business is low set up cost for businesses. According to the KPMG 2012 Competitive Alternatives Survey, Trois Rivieres has the lowest set-up costs in Eastern Canada and the US. Property prices in Trois Rivieres are among the lowest in Canada. For example, the average property in Trois Rivieres costs $157,907, compared to $266,998 in Quebec City, $281,300 in Montreal, $187,500 in Sherbrooke and $819,700 in Vancouver. This supports the fact that businesses running in this city enjoy lower overhead costs (such as rent) compared to other big cities in the region.

IndustryLawn and Garden Equipment and Supplies Stores (NAICS code 4442) consists of

establishments primarily engaged in retailing lawn, garden and farming equipment and supplies. From all the lawn, garden and farm equipment and supply stores active in Canada, 15.2 percent are located in the province of Quebec.

The primary source of operating revenues for the vast majority of lawn, garden and farm retail businesses is sales. Other sources of revenues includes commissions, manufacturing sales, labour revenues and revenues from rental and leasing. Based on the statistics of CIS in 2011, sales represented 98.2% of total operating revenues while other sources of revenues accounted for 1.8%. According to the Canadian Business Patterns Database, the average annual

5 | P a g e

revenues for small and medium-sized businesses in the lawn and garden equipment and supplies stores industry group was $454,900 in 2010.

Target MarketThe target market for the proposed business will be farmers, landscaping contractors,

municipalities and homeowners in Trois Rivieres QC, who need farming, gardening and landscaping equipment. Based on the information provided by Innovation et Développement économique Trois-Rivières, there are currently 62 landscaping contractors active in Trois Rivieres which are potential customers for the business.

Many homeowners who landscape their properties spend an average of 10 percent of the value of their house on landscaping. This includes not only the plants and statuary, but also the design, installation, and maintenance of the landscape. Although the proposed business will primarily be involved in providing tools and equipment for landscaping, it still plans to gain revenue from other activities involved in lawn, gardening and farming industry in the region mainly through commissions and affiliate deals with landscaping contractors and consultants in Trois Rivieres. The business will sign a deal with contractors and consultants in the area to receive a percentage of the revenue from the clients it refers.

Products and Services

ProductsThe proposed business will offer tools and equipment for farming, gardening and

landscaping use in four main categories: Lawn care, Gardening, Storage and, Tools and Power Equipment. The tools and equipment are mainly used for plant nurseries, farms, beekeeping, gardening, lawn care and landscaping. The product offerings each category will cover include:

1- Farming and Lawn Care Supplies: includes fertilizers and plant food, herbicides and fungicides, insecticides and pest control, landscaping and lawn care, soils and conditions, spreaders and garden seeders, etc.

2- Gardening and Landscaping Supplies: includes seeds, garden maintenance and supplies, planters and lawn décor, water gardening, etc.

3- Storage and Tools: consists of hoses and sprinklers, lawn and garden hand tools, sprayers, storage, wheelbarrows and carts, etc.

4- Power Equipment: consists of grass trimmers and blowers, tractors and mowers, woodcutting, leaf blowers, etc.

6 | P a g e

Products will be available according to customers’ needs and can be purchased directly from the store or online through the business’ website. Also, complete information about the products and training videos will be available on the website of the business.

Services

Equipment RentalBesides the sales of garden, landscape and farming equipment and supplies, the

business will also be renting popular and sought after machinery and tools such as lawn mowers, chainsaws, hedge trimmers, garden tractors and utility vehicles. The business will also arrange the rental of heavy farming machinery for farmers of the area who need extra tools and machinery for their tasks. The business will act as an intermediary between agricultural rentals in other cities and regions, and farm owners in and around Trois-Rivieres.

Delivery & WarrantyThe business also provides services such as warranties, deliveries, and repairs. In case a

customer requests for a product that is not in stock, the business will make the arrangements for offering the required product as a part of its service.

Landscaping ConsultantCustomers who do not possess the knowledge and skill to landscape their own yard and

lawn may use the service of a professional landscaping consultant which will be provided by the firm on demand. The consultant will solely offer designs and suggestion based on the tastes of the customer, and for plantation and landscaping, will refer the customer to the affiliate landscaping contractor with which the firm has referral contract. All the necessary equipment for gardening and farming will be bought from the store and delivered to the location the customer needs.

Website The business will provide a website with a secure online ordering system which enables

the customers to order the products online. Customers who order their products over the internet can have it delivered directly to their doorstep. Deliveries of the business will be handled by a third party delivery company and will include virtually all the products in stock.

The website of the business intends to be a hub, not only for local, but for customers interested in farming and gardening in the larger regional market which will increase the reach of the proposed business to a wider area. The website will offer complete information on the

7 | P a g e

products, along with information about how to use the products, and video training files that offer useful information about farming and gardening.

Company and Ownership StructureThe business will be operated as a single proprietorship type of business. The benefits of

this structure are lower levels of legal and tax formalities and less expensive cost of setting up the business. Also, the control and profit remain entirely with the business owner. The business will seek to enter into distributorship arrangements with farm supply manufacturers and distributors. The funds that will be required to start this business will come from the savings of Mr. Rahmani. He will be investing development time, experience, and 100% of start-up costs of $175,000.

OperationsThe proposed business will supply its wide range of tools and equipment from suppliers

in Canada and the United States. It also plans to gain dealership of a number of respected brands in this industry so that it can provide better product and services for its customers. Environment friendly products will be the primary choice of the business. The immediate customers will be businesses such as landscaping contractors and farmers along with households in need of landscaping equipment.

The business plans to distinguish itself from the competitors in the region by providing the best quality products, offering a wide range of tools and equipment to meet all needs, providing complete information about each product and offering consultancy services. The products will be environment friendly, and will be chosen according to the needs and conditions of the customers in, and around Trois Rivieres. Consultancy services will also be available for customers who are not familiar with lawn, gardening and farming equipment and activities.

LocationThe total area needed for office use, display and storage of the products will be from

1,500 to 2,500 Square Feet. An ideal location for the business is a commercial space located at 2182 Rue St-Philippe, Trois-Rivières. The proposed location is a commercial rental space with a detached office of 3,100 Square feet. It includes a storage space in the back, as well as a small office area. The asking price for the property is $1,500 per month.

8 | P a g e

Key features of this property are:

Huge commercial space of 3,100 Sq ft Storage area in the back of 29x21 ft Small office area Proximity to the Autoroute Felix-Leclerc highway

SuppliersThe proposed business will have a wide range of suppliers to meet all the needs of its

customers. The focus is on high quality and environmentally friendly products. The business also plans to enter into dealership arrangements for the garden and farm equipment products. A favourable supplier for arranging a dealership agreement is Ferris industries (www.ferrismowers.com). Ferris Industries produces quality outdoor power equipment and is famous for its top of the line lawn mowers. Currently, Ferris Industries does not have a dealer in Trois Rivieres and this makes it a perfect dealership candidate for the business.

Other potential suppliers of tools and equipment for the business are:

True Temper: www.amestruetemper.com Sunlight Supply Inc. www.sunlightsupply.com OESCO. Inc. www.oescoinc.com Terrebonne Limited www.terrebonnelimited.com Grower Central; Environmentally Friendly Fertilizers and Pesticides

www.growercentral.com

9 | P a g e

BWGS; Bloomington Wholesale Garden Supply www.bwgs.com Rain Bird Corporation www.rainbird.com

Competition

General DescriptionAs mentioned, 9 businesses are active in the same field as the proposed business in

Trois Rivieres which in one form or another, will be competing in the market. The table below lists the competitors in Trois Rivieres. These competitors comprise of privately owned stores, big department stores and landscaping contractors which all or some part of their activities overlap with those of the proposed business.

No.Competitor's Name Description Location

1Pepiniere Cormier

Garden center and farm supplies, gardening equipment and plants

2420 Boul ThibeauPhone: (819) 376-3081

2 WalmartDepartment Store with a small division for gardening equipment

300 Rue BarkoffPhone: (819) 379-2992

3 WalmartDepartment Store with a small division for gardening equipment

4520 Boul RoyalPhone:(819) 372-1181

4Botanix Gaetan Chasse Inc

Garden center & farm supply, Gardening and farming equipment and plants

5350 Boul Jean-XxiiiPhone: (819) 378-4666

5Major Mini Moteur Inc

Industrial equipment including lawn mower sales, maintenance and repair

541 Boul Sainte-MadeleinePhone: (819) 372-0399

6

Machineries Baron & Tousignant

Outdoor power equipment, including lawn mowers, leaf blowers, chain saws, etc.

7515 Boul Des ForgesPhone: (819) 378-3472

7F Labonte Paysagiste Inc Garden center & farm supply

8400 Boul Des ForgesPhone: (819) 373-6103

8 Pro-Dam Garden center & farm supplyPhone: (819) 699-3905

9 Canadian Tire Department store with a small division for 6 Rue Fusey

10 | P a g e

gardening equipment

G8T 2T1Phone: (819) 376-9646

There are also a small number of indirect competitors who in the area. Although their field of activity isn’t the same as the proposed business, they are active in landscaping consultancy and provide basic lawn and garden equipment from various retailers for their clients.

1Cedres De La Maurice Landscaping services & plant and tree nursery

2185 Rue Ludger-MadorePhone: (819) 372-6619

2Techni Irrigation

Irrigation systems and equipment, landscaping consultancy

735 Rue Des DominicainsPhone: (819) 373-4472

Competitive AdvantageWhile the competitors in Trois Rivieres are varied from small gardening equipment

shops to big international department stores such as Walmart, the proposed business plans to rely on its competitive advantage to gain a considerable market share.

The main competitive advantage of the business will be the fact that unlike some of its competitors such as big department stores, which provide a very wide range of products and only dedicate a small portion of their store space to lawn, gardening and farming equipment, the proposed business will only specialize in this industry and focus all its effort on providing products and services in this category. Further, it will be renting popular equipment and tools for the use of contractors and homeowners.

The website of the business will drive the online customers searching for lawn, gardening and farming equipment and supplies to the store. It will also become a hub for the gardening enthusiast of Trois Rivieres for finding new tips and advice about farming, landscaping and gardening in the area. This aspect of the business is unique in the area and will give it a competitive edge in the market.

11 | P a g e

Lastly, while the business is primarily involved in providing equipment and supplies for lawns, gardens and farms, it will also engage in providing top quality landscaping consulting services for business and homeowners who prefer having an expert design and plan their landscaping expansions. This differentiates the business form the retail stores which only provide the equipment and supplies to the customer.

Marketing

Promotional ActivitiesThe key promotion strategy will be differentiating the business from other competitors

in the region by including landscaping consultation next to the tools and machinery sold in the store.

Also, the business will focus a lot of its effort on promoting the website as a reliable authority in lawn, gardening and farming information for Trois Rivieres and the surrounding area. The business plans to drive a large amount of traffic through its main website in hopes that a percentage of it will translate into sales for the store.

For this reason, the business plans to dominate the local online searches for lawn, gardening and farming equipment through powerful content on the site and using a strong content management system (CMS). The business will also consult with SEO (search engine optimization) experts from the beginning of the process to ensure the website has a good place among search engines and will even invest in online advertisements such as banner ads, Facebook targeted ads and Google AdWords.

AdvertisementThe business will use banner advertisements in different locations around the city and

print leaflets and flyers for distribution among potential customers. Also, the business will advertise in directories such as the Yellow Pages and trade show magazines. All the advertisement material will include a brief description of the products and services provided by the business. The material will refer the potential customers to the store and the website of the business.

As for online advertisements, the business will invest in Google AdWords for its first year and use banner ads on related websites in the field of lawn, gardening and agriculture to drive traffic to its website and promote it as a reliable source of information and tips about gardening and landscaping in the area.

12 | P a g e

PriceThe preferred pricing strategy for this business is market-oriented pricing. Based on this

strategy, the business sets a price based upon analysis and research compiled from the market in Trois-Rivieres. Depending on the pricing of the competitors, the business will decide to either price its goods at an above price or below, to achieve its goals. As for renting, the business will rent popular lawn, garden and farming equipment at a price range between $20 - $270 per day depending on the equipment and machinery.

SWOT Analysis

Strengths Business start-up and operations entirely funded by the owner, no debt burden or

interest expense Having a series of revenue sources besides direct sales in the store such as commissions,

affiliates and online sales Uniqueness of the business due to not only providing and renting tools and equipment

in its store, but also providing landscape consulting services An online presence and distribution of lawn, gardening and farming equipment through

its high traffic website Creating a large online follower base through the website and social media for

gardening and landscaping enthusiasts

Weaknesses Lack of experience in running a retail store of this nature May need time to fully understand the dynamic of the market in the area

Opportunities Over the next five years, renewed confidence in the economy and increased

discretionary incomes are expected to boost industry revenue Distance of Trois Rivieres from the major cities means that the market is available for

local businesses Possible opportunity for future expansion of the business into the landscaping

consulting and landscaping contracting industries

Threats Existing competition in the area

13 | P a g e

Personnel PlanIn addition to the services of Mr. Rahmani, who will be the managing director of this

firm, the business will employ one full-time sales person for the store as well as a part-time landscaping consultant.

Mr. Rahmani’s duties will include:

Supervising daily operations of the store Conducting market research and competitor analysis Managing company’s finances and controlling expenses Ensuring that the activities of the business are in line with the laws of Quebec and

Canada as a whole Consulting with suppliers and ensuring that the store has a stock of the newest and

latest lawn, gardening and farming equipment Negotiating with potential customers and clients Establishing relations and entering into distributorship arrangements with suppliers

Sales personThe salesperson needs to have considerable knowledge about lawn, gardening and farm

equipment and have experience repairing and maintaining gardening and farm machinery. The sales person’s responsibilities are:

Greeting customers and offering them assistance Advising customers by providing information on products Helping customers make selections by building customer confidence; offering

suggestions and opinions. Maintaining and repairing stores tools and machinery Documenting the sale by creating or updating customer profile Processing payments by totaling purchases; processing checks, cash, and credit cards Keeping clientele informed by notifying them of preferred customer sales and future

merchandise of potential interest Arranging the delivery of the product and services to the desired location by the

customer

Landscaping ConsultantThe proposed business plans to hire a part-time landscaping consultant primarily to

assist private homeowners who might prefer to have an expert, design and conduct their lawn, garden or yard expansions. The landscaping consultant will observe the specific location for the job and depending on the customer’s preference, suggest designs and plan the landscape, garden or the distinct space. The landscaping consultant needs to have two years of experience

14 | P a g e

in either gardening or landscaping with an acceptable knowledge of various shrubs, plants and trees.

The landscaping consultant’s responsibilities are:

Giving advice to the customer about their needs and preferences Scouting out the area and gathering necessary information for the landscaping design Offering various designs and ideas for landscaping projects Deciding on the appropriate tools, equipment and machinery for the job Referring customers to the affiliate landscape contractors Cooperating with landscape contractors to ensure that the designs are implemented as

planned

The landscaping consultant will be hired at a per-hour basis. The average salary for a landscaping consultant is roughly $30 an hour.

Personnel PlanPersonnel Plan

Year 1 Year 2 Year 3Manager $35,000 $36,750 $38,588Sales Person $27,500 $31,500 $33,075Total People 2 2 2

Total Payroll $62,500 $68,250 $71,663

Financial Analysis

The $175,000 capital investment of the proposed business is broken down as follows:

Breakdown of Investment

List of expenses Estimated CostLegal & Business fees $6,000

Sales Promotion Activities & Advertising Material $10,000

Signage and Store branding $3,000

Leasehold Improvements $14,000

Insurance $2,000

Miscellaneous $3,000

15 | P a g e

Total Start-up Expenses $38,000

Long-term Assets

Computers, POS, printers, fax machine and telephone $12,000

Equipment for rent $10,000

Website Design and required software $10,000

Store Furniture $10,000

Total Long-term Assets $42,000

Cash Required $45,000

Start-up Inventory $50,000

Total Assets $137,000

Total Requirements $175,000

Sales Promotion Activities & Advertising MaterialThe $10,000 budget estimate will serve to cover costs related to the grand opening and

advertising, as well as marketing and promotional materials and expenses. The main focus of the advertising campaign will be on online advertising such as Google AdWords, banner ads on related website and targeted advertisements on Facebook, however the business also plans to print leaflets and flyers and advertise on yellow pages and local magazines in Trios Rivieres and the surrounding areas.

Leasehold Improvements A budget of $14,000 is estimated for the renovation of the desired location of the

business. Since the desired location is a commercial building of 3,100 Square Feet, the budget for leasehold improvements will include the following: interior design and layout of the location, such as modification, expenses for trade contractors, such as painters, IT components, telephone installations and renovation of the façade of the building.

Website Design and Required SoftwareThe estimated budget of $10,000 will be set aside for software such as accounting

software and the design of the website. A webmaster who will design the company’s website will be hired for this project. The website will include a complete list of products available in the store all with instructional videos or photos. Also the website will have an online ordering system so that customers can order the products directly from the site and have it delivered to their doorstep. Some part of this budget will be dedicated to hiring an SEO (search engine

16 | P a g e

optimization) consultant to optimize the content of the site and increase its position among search engines.

Cash RequiredThe amount of $45,000 will be set aside to support ongoing expenses such as payroll,

utility costs, rent, taxes, permits, and other miscellaneous costs to the extent that these costs are not covered by gross revenues.

Sales ForecastSales Forecast

Year 1 Year 2 Year 3Unit SalesLawn Care 1,381 1,808 2,079Gardening 1,012 1,325 1,524Storage & Tools 1,122 1,469 1,689Small Power Equipment 356 462 531Large Power Equipment 96 126 145Rent 88 115 132Consultation Service 133 264 324Total Unit Sales 4,442 5,905 6,811

Unit Prices Year 1 Year 2 Year 3Lawn Care $30.00 $30.00 $30.00Gardening $40.00 $40.00 $40.00Storage & Tools $50.00 $50.00 $50.00Small Power Equipment $100.00 $100.00 $100.00Large Power Equipment $1,100.00 $1,100.00 $1,100.00Rent $40.00 $40.00 $40.00Consultation Service $60.00 $60.00 $60.00

SalesLawn Care $41,430 $54,236 $62,371Gardening $40,480 $52,992 $60,941Storage & Tools $56,100 $73,440 $84,456Power Equipment $141,200 $184,844 $212,570Rent $3,520 $4,608 $5,299Consultation Service $7,980 $15,840 $19,440Total Sales $290,710 $385,959 $445,077

Direct Unit Costs Year 1 Year 2 Year 3Lawn Care $18.30 $18.30 $18.30Gardening $24.40 $24.40 $24.40Storage & Tools $30.50 $30.50 $30.50Power Equipment $122.00 $122.00 $122.00Rent $0.00 $0.00 $0.00Consultation Service $30.00 $30.00 $30.00

17 | P a g e

Direct Cost of SalesLawn Care $25,272 $33,084 $38,046Gardening $24,693 $32,325 $37,174Storage & Tools $34,221 $44,798 $51,518Power Equipment $86,132 $11

2,755$129,668

Rent $0 $0 $0Consultation Service $3,990 $7,920 $9,720Subtotal Direct Cost of Sales $174,308 $230,882 $266,126

Income StatementPro Forma Profit and Loss

Year 1 Year 2 Year 3Sales $290,710 $385,959 $445,077Commissions $1,454 $5,789 $6,676Direct Cost of Sales $174,308 $230,882 $266,126Total Cost of Sales $174,308 $230,882 $266,126

Gross Margin $117,856 $160,866 $185,627Gross Margin % 40.54% 41.68% 41.71%

ExpensesPayroll $62,500 $68,250 $71,663Marketing/Promotion $2,040 $11,000 $12,000Depreciation $3,200 $3,200 $3,200Rent $18,000 $18,000 $18,000Utilities $6,000 $8,000 $9,000Insurance $2,000 $4,000 $4,000Delivery, shipping and warehouse expenses $4,000 $5,000 $6,000Repair and maintenance $1,000 $1,500 $2,000Professional and Business fees $1,000 $6,000 $7,000Startup Costs $38,000 $0 $0Other $3,000 $4,000 $4,500

Total Operating Expenses $140,740 $128,950 $137,363

Profit Before Interest and Taxes ($22,884) $31,916 $48,264EBITDA ($19,684) $35,116 $51,464

18 | P a g e

Interest Expense $0 $0 $0 Taxes Incurred $0 $2,800 $15,550

Net Profit ($22,884) $29,116 $32,714Net Profit/Sales -7.87% 7.54% 7.35%

Balance sheetPro Forma Balance Sheet

Start Up Year 1 Year 2 Year 3Assets

Current AssetsCash $45,000 $56,061 $62,082 $91,734Inventory $50,000 $81,405 $110,823 $118,949Total Current Assets $95,000 $137,466 $172,905 $210,683

Long-term AssetsLong-term Assets $32,000 $32,000 $32,000 $32,000Accumulated Depreciation $0 $3,200 $6,400 $9,600Other Long term Assets (Website, Software)

$10,000 $10,000 $10,000 $10,000

Total Long-term Assets $42,000 $38,800 $35,600 $32,400Total Assets $137,000 $176,266 $208,505 $243,083

Liabilities and Capital Year 1 Year 2 Year 3

Current LiabilitiesAccounts Payable $0 $24,150 $27,273 $29,137Current Borrowing $0 $0 $0 $0Other Current Liabilities $0 $0 $0 $0Subtotal Current Liabilities $0 $24,150 $27,273 $29,137

Long-term Liabilities $0 $0 $0 $0Total Liabilities $0 $24,150 $27,273 $29,137

Paid-in Capital $175,000 $175,000 $175,000 $175,000Retained Earnings ($38,000) $0 ($22,884) $6,232Earnings $0 ($22,884) $29,116 $32,714Total Capital $137,000 $152,116 $181,232 $213,946Total Liabilities and Capital $137,000 $176,266 $208,505 $243,083

Net Worth $137,000 $152,116 $181,232 $213,946

19 | P a g e

References

http://pss.uvm.edu/ppp/articles/lscaper.html

http://realestate.heraldtribune.com/2013/06/03/boost-value-to-your-home-with-landscaping/

https://www.ic.gc.ca/app/scr/sbms/sbb/cis/benchmarking.html?code=4442&lang=eng

http://www.idetr.com/en/portrait-of-trois-rivieres/business-friendly/index.aspx

http://www.bls.gov/oes/current/naics4_444200.htm

http://www.ibisworld.ca/industry/lawn-outdoor-equipment-stores.html

http://www.ibisworld.ca/industry/plant-flower-growing.html

http://www.ibisworld.ca/industry/landscaping-services.html

http://www.ibisworld.ca/industry/default.aspx?indid=1037

20 | P a g e

Appendix

Product SummaryThe business will have four main product categories of lawn care, gardening, storage & tools, and power equipment’s. Each product category has several sub categories which include a number of products. Below a summary of each sub category and their price range is provided.

Farming and Lawn Care Supplies

Fertilizers & Plant food$5.99 - $44.99

Herbicides & Fungicides$8.99 - $29.99

Insecticides & Pest Control$5.99 - $13.99

Landscaping & Lawn Care$2.50 - $44.99

Soils & Conditioners$1.59 - $14.99

Spreaders & Garden Seeders$59.99 - $100

Gardening and Landscaping Supplies

Bulbs and Seeds$1.69 - $8.99

Garden Maintenance Supplies$3.99 - $30.49

Planters & Lawn Décor$5.99 - $14.99

21 | P a g e

Water Gardening$12.99 - $124.99

Beekeeping$54.99 - $119.99

Storage & Tools

Hoses & Sprinklers$6.99 - $89.99

Lawn & Garden Hand Tools$7.99 - $25

Snow Removal$5 - $22.99

Sprayers & Dusters$5 - $59.99

Storage$20 – $150

Wheelbarrows & Carts$40 - $70

Power Equipment

Grass Trimmers & Blowers$33 - $200

Leaf Blowers$35 - $159.99

ATV Accessories$20 - $80

22 | P a g e

Lawn Tractors & ATV Attachments$65 - $400

Snow Blowers & Accessories$24.99 - $799.99

Specialty Power Equipment$300 - $800

Tractors & Lawn Mowers$180 - $3,190

Tractor & Lawn Mower Parts$3.99 - $60

Woodcutting$90 -$200

23 | P a g e