Download - EXOTIC CARS ASSOCIATION
Naif Al-RajhiChief Executive Officer
Danny Nguyen Vice President
Vickie Charamita Chief Financial Officer
Devin Amin Market Research Analyst
Peter PaulinPublic Relations & Promotions Director
E M P L O Y E E S P O S I T I O N S
O U R P R O M I S E …
We will provide exotic cars enthusiasts exceptional service and premiere networking automobile club.
E X T E R N A LI N T E R N A L
P R O B L E M S
1 . P r i c e
2 . C u s t o m e r S a t i s f a c t i o n
& R e p u t a t i o n
3 . C o m p a n y ’ s M a r k e t
P o s i t i o n & P l a c e m e n t
1 . C a r T h e f t
2 . C o n t r a c t u a l
C o m m i t m e n t
3 . C a r D a m a g e &
Va n d a l i s m
E X T E R N A LI N T E R N A L
S O L U T I O N S
1 . K e e p o u r P r i c e
C o m p e t i t i v e
2 . N e t w o r k i n g
O p p o r t u n i t i e s , E v e n t s
& To u r s
3 . W e w i l l m a k e s u r e
t h a t w e p o s i t i o n o u r
c o m p a n y e x c l u s i v e l y
1 . G P S & R a d i o
F r e q u e n c y T r a c k i n g
S y s t e m , F u e l C u t - O f f
S y s t e m ( E n g i n e
I m m o b i l i z e r )
2 . W e p r o v i d e
c o n t r a c t u a l o p t i o n s
f o r l e i s u r e o f o u r
c u s t o m e r s
3 . D e d u c t i b l e
C o n s e q u e n c e o r
C o v e r e d b y
C u s t o m e r s
A R E A : B A Y A R E AP O P U L A T I O N : 7 . 1 5 m i l l i o nI N C O M E D I S T R I B U T I O N
T o p 1 % : $ 3 8 0 , 3 5 4T o p 5 % : $ 1 5 9 , 6 1 9
S C A L E A B I L I T Y P L A N
2 0 1 2 t o 2 0 1 7B a y A r e a
2 0 1 7 o n w a r d sL o s A n g e l e s
O r a n g e C o u n t y
M A R K E T I N G S T R AT E G Y
S A L E S S T R AT E G Y
Recruit Potential
Customers
Build Relationships
Maintain Relationships
S P O R T I V A
MEMBERSHIP
POINT SYSTEM
WEAKNESSES
E X O T I C C A R S A S S O C I A T I O N
MEMBERSHIP
POINT SYSTEM
Projected Recruited Members35-50 People
Exotic Cars Association Membership Sales Projection
Beginning Year 2012 to End of Year 2017
YEAR 2012 2013 2014 2015 2016 2017
Projected Growth 5% 10% 15% 20% 24% 27% 100%
Quantity 3 5 7.5 10 12 14 50
Sales Price $ 29,000.00 $ 29,000.00 $ 29,000.00 $ 29,000.00 $ 29,000.00 $ 29,000.00
Sales Revenue $ 72,500.00 $ 145,000.00 $ 217,500.00 $ 290,000.00 $ 340,750.00 $ 391,500.00
Total $ 1,457,250.00
PRO FORMA CASH FLOW
YEAR 2012 2013 2014 2015 2016 2017
EBDT $ 4,097.30 $ 59,513.00 $ 127,452.00 $ 189,232.00 $ 238,866.00 $ 271,500.00
Depreciation $ - $ - $ - $ - $ - $ -
EBT $ 4,097.30 $ 59,513.00 $ 127,452.00 $ 189,232.00 $ 238,866.00 $ 271,500.00
Tax Deductible $ 42,431.00 $ 59,500.00 $ 59,500.00 $ 59,500.00 $ 59,500.00 $ 59,500.00
EAT $ 46,528.30 $ 119,013.00 $ 186,952.00 $ 248,732.00 $ 298,366.00 $ 331,000.00
Depreciation charged without cash outlay $ - $ - $ - $ - $ - $ -
Cash Flow $ 46,528.30 $ 119,013.00 $ 186,952.00 $ 248,732.00 $ 298,366.00 $ 331,000.00
TAX 179 DEDUCTION
EXOTIC CARS ASSOCATIONPROFORMA INCOME STATEMENT
BEGINNING YEAR 2012 TO END 2017
YEAR 2012 2013 2014 2015 2016 2017
Sales Revenue $ 72,500.00 $ 145,000.00 $ 217,500.00 $ 290,000.00 $ 340,750.00 $ 391,500.00
Costs of Good Sold $ - $ - $ - $ - $ - $ -
Gross Profit $ 72,500.00 $ 145,000.00 $ 217,500.00 $ 290,000.00 $ 340,750.00 $ 391,500.00
Lease Expense $ 68,402.70 $ 85,487.00 $ 90,048.00 $ 100,768.00 $ 101,884.00 $ 120,000.00
EBIT $ 4,097.30 $ 59,513.00 $ 127,452.00 $ 189,232.00 $ 238,866.00 $ 271,500.00
Interest Expense $ 1,935.80 $ 2,405.00 $ 4,500.00 $ 6,000.00 $ 7,200.00 $ 9,300.00
EBT $ 2,161.50 $ 57,108.00 $ 122,952.00 $ 183,232.00 $ 231,666.00 $ 262,200.00
Tax Deductible $ 42,431.00 $ 59,500.00 $ 59,500.00 $ 59,500.00 $ 59,500.00 $ 59,500.00
EAT $ 44,592.50 $ 116,608.00 $ 182,452.00 $ 242,732.00 $ 291,166.00 $ 321,700.00
Q&A
How are you going to make money? How can you afford a car for every customer?
- Can you explain how are you going to break even in 3 years?
- Are you paying salaries for your employees? (at early stages) if yes, how much?
If not, how are they going to survive?
Yes, we will provide everybody (with the exception of CEO) a base of $45K, but with
financial incentives. That is, with every member (or extremely high-end vehicle added)
gained to the association by a sales person, they get a $500 bonus. This will help to
motivate employees.
- If a customer is planning to go with the higher level of a membership why won’t
he lease the car rather than go with the membership fee?
Because he/she wants to be a part of an “exclusive club” for status reasons, and social
reasons. And there are more benefits if he get higher membership fee (examples: new
car introduction event access, discounted car rally fees)
TAX 179 DEDUCTIONS
2012 Deduction Limit = $139,000
Section 179 Deduction limit after adjustment for inflation has increased to
$139,000 (maximum allowance would have been only $25,000 prior to the
new legislation).
2012 Limit on Capital Purchases = $560,000
Section 179 Threshold for total of equipment & software that can be
purchased has increased to $560,000 (threshold would have been only
$200,000 prior to the new legislation).
2012 Bonus Depreciation = 50%
The new law allows 50% “Bonus Depreciation” on qualified assets placed in
service during 2012
PRO FORMA CASH FLOW
YEAR 2012 2013 2014 2015 2016 2017
EBDT $ 4,097.30 $ 59,513.00 $ 127,452.00 $ 189,232.00 $ 238,866.00 $ 271,500.00
Depreciation $ - $ - $ - $ - $ - $ -
EBT $ 4,097.30 $ 59,513.00 $ 127,452.00 $ 189,232.00 $ 238,866.00 $ 271,500.00
Tax Deductible $ 42,431.00 $ 59,500.00 $ 59,500.00 $ 59,500.00 $ 59,500.00 $ 59,500.00
EAT $ 46,528.30 $ 119,013.00 $ 186,952.00 $ 248,732.00 $ 298,366.00 $ 331,000.00
Depreciation charged without cash outlay $ - $ - $ - $ - $ - $ -
Cash Flow $ 46,528.30 $ 119,013.00 $ 186,952.00 $ 248,732.00 $ 298,366.00 $ 331,000.00
EXOTIC CARS ASSOCATIONPROFORMA INCOME STATEMENT
BEGINNING YEAR 2012 TO END 2017
YEAR 2012 2013 2014 2015 2016 2017
Sales Revenue $ 72,500.00 $ 145,000.00 $ 217,500.00 $ 290,000.00 $ 340,750.00 $ 391,500.00
Costs of Good Sold $ - $ - $ - $ - $ - $ -
Gross Profit $ 72,500.00 $ 145,000.00 $ 217,500.00 $ 290,000.00 $ 340,750.00 $ 391,500.00
Lease Expense $ 68,402.70 $ 85,487.00 $ 90,048.00 $ 100,768.00 $ 101,884.00 $ 120,000.00
EBIT $ 4,097.30 $ 59,513.00 $ 127,452.00 $ 189,232.00 $ 238,866.00 $ 271,500.00
Interest Expense $ 1,935.80 $ 2,405.00 $ 4,500.00 $ 6,000.00 $ 7,200.00 $ 9,300.00
EBT $ 2,161.50 $ 57,108.00 $ 122,952.00 $ 183,232.00 $ 231,666.00 $ 262,200.00
Tax Deductible $ 42,431.00 $ 59,500.00 $ 59,500.00 $ 59,500.00 $ 59,500.00 $ 59,500.00
EAT $ 44,592.50 $ 116,608.00 $ 182,452.00 $ 242,732.00 $ 291,166.00 $ 321,700.00
Exotic Cars Association Membership Sales Projection
Beginning Year 2012 to End of Year 2017
YEAR 2012 2013 2014 2015 2016 2017Projected Growth 5% 10% 15% 20% 24% 27% 100%
Quantity 3 5 7.5 10 12 14 50
Sales Price $ 29,000.00 $ 29,000.00 $ 29,000.00 $ 29,000.00 $ 29,000.00 $ 29,000.00
Sales Revenue $ 72,500.00 $ 145,000.00 $ 217,500.00 $ 290,000.00 $ 340,750.00 $ 391,500.00 Total $ 1,457,250.00
- How does the points system work?7.5 points per dollar.- What differentiates you from Sportiva, which has been well intact for many years now?The cost of using our luxury cars is cheaper with us. Our membership is also more distinct.- To what extent is your company impacted if an influx of members were to leave the association? When members leave, they most likely will have a substantial amount of points left over. Our policy is that they can only cash out 5 percent of the points.-How many customers/members are needed to sustain the financial health of the company?
- What makes a customer pay for a higher membership rather than a lower one?The benefits that the customer will get in a higher membership
- What will you do for the customers who are dissatisfied with the product or service?We have a customer service department that will handle all complaints and dissatisfied customers. Because it costs so much to be a member of our association, we understand that we need to take all matters seriously as each customers are of significant value to the financial health of our company.- Are your sales methods really only going to be limited to car rallies etc.? For the time being they are our most vital channel, however we also plan to contact recreational car enthusiast associations, or other relevant event environments where we expect our target customers (the wealthy) to likely attend. - How will you make your sales pitch at these exclusive events (i.e. Gumball) without people feeling put-off or smothered?Our “lobbyists” are not to be overly aggressive, but more informative. We plan to casually approach curious customers and provide all contact information, but we of course need to train our team to know how to lobby without coming across the wrong way. How will you make your sales pitch at these exclusive events (i.e. Gumball) without
people feeling put-off or smothered?
- John Meraz is a successful IT entrepreneur living in Mountain View, CA. At 34 years old.
- Luxury car enthusiast and currently owns a Caymen 2012 Porche.- He discovered an advertisement featuring a service in San Francisco, which is
called the “Exotic Cars Association”.- Enjoys the service because it provides him with being in a social club with
other members that enjoy the same interests and as a paying member he is able to enjoy his greatest hobby by driving our wide range of luxury cars.
- How does the points system work?7.5 points per dollar.- What differentiates you from Sportiva, which has been well intact for many years now?The cost of using our luxury cars is cheaper with us. Our membership is also more distinct.- To what extent is your company impacted if an influx of members were to leave the association? When members leave, they most likely will have a substantial amount of points left over. Our policy is that they can only cash out 5 percent of the points.- How many customers/members are needed to sustain the financial health of the company?- What makes a customer pay for a higher membership rather than a lower one?The benefits that the customer will get in a higher membership
- If a customer is planning to go with the higher level of a membership why
won’t he lease the car rather than go with the membership fee?
Because he/she wants to be a part of an “exclusive club” for status reasons, and social
reasons. And there are more benefits if he get higher membership fee (examples: new
car introduction event access, discounted car rally fees)
- What do you mean by payment options?annually, and semi-annually.
- What do you mean by payment options?annually, and semi-annually.