edu cyclebusinessplan revised

Business Plan

EduCyle Business Plan

Table of ContentsBusiness Plan .............................................................................................................................................. 1

Executive Summary..................................................................................................................................... 3

General Company Description..................................................................................................................... 5

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

Marketing Plan............................................................................................................................................ 8

Competition............................................................................................................................................... 14

Niche......................................................................................................................................................... 18

Sales Forecast............................................................................................................................................ 21

Operational Plan........................................................................................................................................ 22

Production................................................................................................................................................. 22

Location..................................................................................................................................................... 24

Legal Environment.................................................................................................................................... 27

Management and Organization.................................................................................................................. 29

Professional and Advisory Support............................................................................................................ 29

Personal Financial Statement..................................................................................................................... 34

Startup Expenses and Capitalization.......................................................................................................... 35

Financial Plan............................................................................................................................................ 36

12-Month Profit and Loss Projection......................................................................................................... 36

Four-Year Profit Projection (Optional)...................................................................................................... 36

Projected Cash Flow.................................................................................................................................. 36

Opening Day Balance Sheet...................................................................................................................... 37

Break-Even Analysis................................................................................................................................. 38

Appendices................................................................................................................................................ 39

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Executive Summary

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General Company Description

EduCycle’s mission is to recycle, reuse, and repurpose educational media, supplies and equipment in order to support the learning objectives of educators of all levels, promote sustainable living, and to strengthen communities by providing resources not easily obtained by other means.

The business goals of EduCycle is to provide a core set of services to the community that have educational, economic, and environmental benefits.

Services include :

Recycle Media – in partnership with local municipalities to ensure that unwanted media such as cds/dvds, books, tapes, art supplies, etc… get processed for recycling or proper waste disposal.Repurpose Media – by engaging local artists, individuals, businesses and schools, collected materials can be used for non-educational venturesReuse Media – materials collected will be made available to the community for educational purposes

EduCycle, Inc. is a charitable non-profit organization who relies on donations, service and membership fees, grants and sponsorships to deliver its mission. Operating as a surplus organization and community education center, Educycle will market items to educators, artists, community organizations and individuals.

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Products and Services

As a surplus organiation, EduCycle aims to provide materials, media and supplies to educators, artists, community organizations, and individuals. As a community education center, EduCycle, will provide professional development seminars, arts and crafts workshops, and sustainable development education programs, for its members.

Products available through EduCycle include:

● Office supplies● Art & Drafting Supplies (i.e. crayons, markers, etc.)● Classroom decorations ( i.e. boarders, posters)● Electronic devices (graphing calculators, computers, printers, microscopes, probes,

photogates)● Furniture (Desks, Chairs, bookshelves, file cabinets)● Sporting Equipment (tennis rackets, soccer cleats)● Sporting Apparel (i.e. track pants, soccer jerseys)● Gardening supplies● Biological specimens for dissection (.ie. frogs, fetal pigs, etc.)

EduCycle will also provide services that support educational processes and systems. The following services will be provided:

● Professional Development Seminars : (i.e. Integrating Technology in the Classroom)● Salvage and Reclamation Services : donated items will be evaluated and reclaimed in

our warehouse or recycled● Sustainable Development Education : Programs aimed at educating and engaging the

community in learning about the trade-offs between resource use and quality of life.

Competitive ComparisonOur primary competition will be local educational supply stores and major retail suppliers. We will also be in competition with online and catalogue retailers who sell educational supplies at retail and wholesale prices. The following retailers have been included in our competitive analysis:

● Walmart, Staples and Office Depot are major “one-stop-shop” retailers that offer a wide variety of office supplies, furnishings and electronic equipment and have several locations throughout the city.

● Local educational supply stores such as Learning How provide a wide variety of curricular material and educational supplies. There are two stores in the Baltimore area.

● The list of competitors for online and catalogue retailers include Raymond Geddis and Company and Carolina Biological Supply.

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Pricing and Fee Structures

EduCycle will be a member based organization which will retail annual memberships to educators, organization and individuals. Members will be allowed to shop at our free store and participate in other services. Memberships will be priced according to the following three tiers:

Executive Membership ($149.99/year)Available to youth-organizations, program administrators, allows for the purchase of products at wholesale price; allows for 6 additional cardholders to account and free professional development seminars for each cardholder.

Golden Apple Membership ($49.99/year)This will include educators and parents who want to purchase products and includes free professional development seminars.

Community Supporter Membership ($29.99/year)This will include individuals, parents, artist, and other community supporters.

The following pricing structure will be implemented for services provided by EduCycle:

• Executive Membership additional cards : $20 per card (expires when executive membership expires)

• Professional Development Seminars: $25/hour available to members and non-members

• Recycling and Reclamation Services: Free

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Marketing Plan

EduCycle takes an interdisciplinary approach to supporting the community by bridging the gap between

education and sustainability. The Obama administration has put worth significant effort in both education

and sustainability. In the past couple of years, federal agencies has been shifting their philosophies to

consider long term investments in the environment and education to provide a richer and prosperous

nation for all. Starting in 2010, the Department of Education has started setting the new pace for

education, by becoming leaders in process reform including sustainability. They will be funding more

projects and organizations committed to innovation and improvement of existing processes in the

education system.

Educational Services is the second largest industry, accounting for 13.5 million jobs in 2008 (Bureau of

Labor and Statistics). The educational services sector consists of a single subsector, Educational Services:

North American Industry Classification System 611 (NAICS 611). This industry consists of schools,

colleges, universities and various private institutions. It may also include ancillary education services,

such as after-school tutoring, charter schools, special or alternative education, educational content

suppliers and professional development of administrators and teachers. Most teaching positions, which

constitute nearly half of all educational services jobs, require at least a bachelor's degree; while some

require a master's or doctoral degree.

Market Trends

General trends in the Educational Services Sector are as follows:

● Institutions use Internet-based technology to conduct lessons and coursework electronically, allowing students in distant locations access to educational opportunities formerly available only on site.

● Many local and State governments have authorized the creation of public charter schools, in the belief that, by presenting students and their parents with a greater range of instructional options, schools and students will improve academic achievement.

● On March 14, 2011, President Obama’s made a recent call to the reform of the Bush-era education policy “No Child Left Behind”. Under the law as it currently stands, schools are graded on a pass-fail scale based on the results of standardized tests administered to students. Failing schools, many of which serve low-income communities are penalized, and often shut down or turned over to a charter operator or private firm. The Obama administration is pushing for a major overhaul in this policy by September 2011.

● Academics are playing a more important role in career and technical curricula, and programs are being made relevant to the local job market. Often, students must meet rigorous standards set in consultation with private industry before receiving a certificate or degree.

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● Expanding Science, Technology, Engineering and Math (S.T.E.M.) education which focuses on increasing S.T.E.M. literacy so all students can think critically in these subject areas. There is a push to improve the quality of math and science teaching so American students no longer are outperformed by those in other nations. There is a need to expand STEM education and career opportunities for underrepresented groups, including women and minorities.

Market Needs/DemandsEduCycle proposes to meet the market needs and demands identified below by providing educational resources to enrich the learning experience for both educators and learners. Access to these resources will facilitate the change needed to close the educational gap and make the learning environment more competitive.

● Increased need for a trained and educated workforce.● Growing need to develop lifelong learners interested in acquiring new knowledge and

upgrading skill sets to respond to rapid technological and economic changes.● Increased need to improve education by donating instructional equipment, lending

personnel for teaching and mentoring, hosting visits to the workplace, and providing job-shadowing and internship opportunities.

● There is a current trend to increase student achievement in math and science resulting in a growing need to increase S.T.E.M. education/programs.

● Just 74.9 percent of U.S. students who were freshmen in the fall of 2004 graduated from high school on time in 2008 (National Center for Education Statistics). There is a growing need to increase the number of students graduating from high school.

Growth PotentialSchool attendance is compulsory until at least age 16 in all 50 States and the District of Columbia. As a result, elementary, middle, and secondary schools are the most numerous of all educational establishments. In recent decades, the government has recognized the importance of educational evolution and creating a well-defined education system that will result in economic growth and the transformation of this country.

The Obama administration has launched an education reform campaign demonstrated by the American Recovery Reinvestment Act. The Act has earmarked the following funds for educational reform:

● $5 billion for early learning programs, including Head Start, Early Head Start, child care, and programs for children with special needs.

● $77 billion for reforms to strengthen elementary and secondary education, including $48.6 billion to stabilize state education budgets (of which $8.8 billion may be used for other government services) and to encourage states to do the following:

○ Make improvements in teacher effectiveness and ensure that all schools have highly-qualified teachers;

○ Make progress toward college and career-ready standards and rigorous assessments that will improve both teaching and learning;

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○ Improve achievement in low-performing schools, through intensive support and effective interventions; and

○ Gather information to improve student learning, teacher performance, and college and career readiness through enhanced data systems.

● $5 billion in competitive funds to spur innovation and chart ambitious reform to close the achievement gap.

● $30 billion addressing college affordability and improving access to higher education.

Currently in the education industry, there is a need to improve the quality of instruction and to provide

students and teachers with up-to-date and relevant curriculum materials in order to improve the quality of

instruction and the delivery of content material. Unfortunately, states and schools struggle with budget

deficits as a result of recent fluctuations in the economy. Many of the schools that experience the adverse

effects of dwindling budgets are located in underserved and impoverished communities. School systems

are exploring every resource in an effort to maintain the instructional integrity of their programs.

EduCycle has the potential to provide tangible resources necessary to help close the achievement gap in

the U.S. education system. With state and local funds dwindling, our model allows schools, organizations,

and ancillary education services to gain the resources necessary become competitive with educational

institutions in the private sector. We will partner with local stakeholders to provide training opportunities

for educators which will improve both teaching and learning for underserved populations.

The education industry is rapidly evolving and responds positively to changing trends in technology

creating an increased need for resources and training among students, teachers and administrators.

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Strengths, Weaknesses, Opportunities, Threats

Table 1. Lists the current strengths and weaknesses of EduCycle as well as potential opportunities and threats to its operations.

Strengths Weaknesses

1. Provides discounted/free materials to institutions in need

2. Provides professional development opportunities to individuals in the education sector

3. Economic fluctuations result in an increased need for affordable educatioal resources and training opportunities.

4. Increase in funding initiatives for education reform.

1. Educators purchase instructional materials primarily during two seasons (fall and spring)

2. Unestabllished brand and reputation

3. Lack of experience in the industry

Opportunities Threats

1. Growing trend in educational reform.2. Increased need for technology

integration and training.3. Growing interest S.T.E.M. education.4. Partners ( city, county, etc.) with vested

interest in education reform.

1. Start-up capital

2. Securing donors

3. Copycat businesses

4. Rising Operating Costs due to real estate and municipality taxes

5. Utility costs

According to U.S. Department of Education, Maryland is among 10 winners in President Obama’s “Race to the Top” grant initiative, bringing up to $250 million in education investments to Maryland’s public

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schools. To overcome financial threats EduCycle will research available or anticipated competitive grants in the education sector offered by corporations, federal, state and local agencies.

Product

The client base that will potentially benefit from the products and services provided by EduCycle will include educational institutions, teachers, home-school programs, parents and students. A summary of demographic information for individuals employed in Education, Training and Library Occupations is identified in Table II.

Table II. Demographic Profile

Targeted Customers

Local State National

Population 18, 651 171,755 8,235,725

Average Age

Median income $39,263 $42,318 $37,042

Male

30.9% 26.8% 26.6%

Female

69.1% 73.2% 73.4%

Source: U.S. Census Bureau, 2005-2009 American Community Survey

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EduCycle Features and Benefits

• Surplus of salvaged, reclaimed, donated and purchased items

• Access to professional development seminars and workshops

• Sustainable living education

• Access to a network of community supporters, educators and artist

• Pick-up and transportation of donated items

• Online store and delivery of items

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Competition

The following companies have been identified as major competitors in the market.

Table III. Major Competitors

Competitor A

Learning How

The Shops at Kenilworth, 872 Kenilworth Drive, Towson, MD, 21204, USA

http :// learninghow . com /

1583 Sulphur Spring Road, Suite 101, Baltimore, MD, 21227, USA

Competitor B

Raymond Geddes and Company, Inc. - The School Store Authority

http :// www . raymondgeddes . com /

7110 Belair Rd, Suite 200, Baltimore, MD 21206

Competitor C

Staples

www . staples . com

multiple locations

Competitor D

Walmart

http :// www . walmart . com /

multiple locations

Competitor E

Carolina Biological Supply Company

http :// www . carolina . com /

Online

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http://www.google.com/url?q=http%3A%2F%2Flearninghow.com%2F&sa=D&sntz=1&usg=AFQjCNETPcxoXIN_U06dkxpg9Ion9d5qYA

http://www.google.com/url?q=http%3A%2F%2Fwww.carolina.com%2F&sa=D&sntz=1&usg=AFQjCNFX9MNleWyj3kQ6Gl7QXnlHg6tudA








http://www.google.com/url?q=http%3A%2F%2Fwww.walmart.com%2F&sa=D&sntz=1&usg=AFQjCNFtwtOrvQvHo4qeeWvUye0l4qWLsA








http://www.google.com/url?q=http%3A%2F%2Fwww.staples.com%2F&sa=D&sntz=1&usg=AFQjCNFeUZ-sFHvZSvLPZ70L04oD4mQLjg





http://www.google.com/url?q=http%3A%2F%2Fwww.raymondgeddes.com%2F&sa=D&sntz=1&usg=AFQjCNFmEu1emIqVFbLVbpJ8bV4WhYrU3w














Table IV. Competitive Analysis

Factor EduCycle Strengths Weakness Competitor A (Learning How)

Competitor B (Raymond Geddes)

Competitor C (Staples)

Competitor E (Carolina)

Importance to Customer

Products Emerging company seeking to establish

solid inventory

x Limited amount of subject specific

products, limited electronics inventory

Diverse inventory,Limited

technology inventory

Diverse inventory of

office supplies,

classroom materials and electronics

Diverse subject specific

inventory in math and

science

5

Price Products offered at wholesale prices

x Products prices at regular retail, teacher discount

offered

Products offered at wholesale

prices

Products prices at

regular retail, teacher discount offered

Products offered at regular retail

5

Quality Offers a mix of new and gently used products

x High quality new products

High quality new products



4

Selection Emerging company seeking to establish

solid inventory

x Limited amount of subject specific

products, limited electronics inventory

Diverse inventory,Limited

technology inventory

Diverse inventory of

office supplies,

classroom materials and electronics

Diverse subject specific

inventory in math and science

4

Service Smaller company

with ability to offer quality, personalized

level of service

x Average quality service, unable to handle high

volume

Average quality service, unable to handle high

volume

Average quality service,

unable to handle high

volume

High quality service with the ability to handle

high volume

4

Reliability Emerging company building,

reputation

x High consumer satisfaction

ratings

High consumer satisfaction ratings

High consumer

satisfaction ratings

High consumer satisfaction

ratings

5

Stability Emerging company which is

establishing financial

x Highly established, financially

secure entity

Highly established, financially

secure entity

Highly established, financially

secure entity

Highly established, financially secure entit

3

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stability

Expertise Emerging company which is

establishing stability,

reliability and expertise

x Moderately trained staff

knowledgeable in general

information

Moderately trained staff


information

Moderately trained staff


information

Highly trained staff

knowledgeable in content specific

information

4

Company Reputation

Non-profits generally

have a good reputation for

providing services to

address unmet

community needs

x Well established company

Well established company



4

Location Central location;

potentially in station North

x Only teo location in the Baltimore area

Online store and physical

location

Online store and physical

location

Online store 5

Appearance Clean, bright, well-

organized environment

x Clean, bright, well-organized

environment

Clean, bright, well-organized environment

Clean, bright, well-

organized environment

Organized catalogue and website, user

friendly

5

Sales Method

Internet sales, direct

purchase

x Internet sales, direct purchase

Internet sales, direct purchase

Internet sales, direct

purchase

Internet sales, direct purchase

5

Credit Policies

None x None None None None

Advertising Partners directly with educational institutions

for advertisng;

x Not a visible force in

advertising, maintains clients base during peak

seasons; uses

Uses major forms of media for

advertising such a

circulars in

Not a visible force in

advertising, maintains clients base during peak

seasons; uses

3

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Uses mailing lists and

email

mailing lists and email

newspapers mailing lists and email

Image Reputable organization

founded, owned and operated by educators.

x Major corporation providing

limited selection of educational

materials

Established teacher store providing a grade and

content specific educational materials

Major corporation providing diverse

selection of educational materials, electronics and office supplies

Major corporation providing

diverse selection of content specific

educational materials and

electronics

5

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Niche

EduCycle provides cost effective curriculum materials to individuals, educational institutions and businesses seek to improve learning experiences for students in grades K-12.

EduCycle will focus on local school districts to establish its name in Baltimore City. As the business progresses over the next 1-3 years, added emphasis will be placed on sales to urban school districts in Maryland and the District of Columbia. Although there is a potential for significant profits through direct sales, greater gross margins are possible through eCommerce. The market analysis shows a broad range of prospective clients in urban educational setting throughout the nation, covering a wide range of consumers who are generally interested in discounted educational resources and supplies.

Promotion

Marketing Goals and ObjectivesTBD

Overall Marketing Strategy

Our company’s strategy is based on providing the most diverse inventory ofeducational resources and supplies to schools in disadvantaged environments. Ourgoal is to focus on consumer needs and to capitalize on shrinking budgets in theeducational sector which have resulted in a deficit in curricular materials necessaryto sustain competitive learning environments.

Marketing Strategies

1. Invest in a Website

Gives customers another way to see products or services other than coming into store and setting up a meeting; provides a fast, inexpensive way to update information and get new details in front of customers.

2. Business cards

Includes website and E-mail addresses on the cards; distribute business cards as a means of networking among educational professionals

3. Create and maintain a client database.

Get customers' contact information by:

● Collecting customer business cards in a fishbowl.

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● Partner with local retailers of educational supplies. Encourage customers to drop of business cards in a fishbowl by offering a monthly drawing and giving the winner a discounted or free item from your business.

● Hold seminars on topics related to urban education.● Register participants and maintain their contact information in database.●

4. Use database to connect with customers at least six times every year.● Send out two newsletters a year. Distribute newsletters during the busiest seasons of

the year, ie. end of summer and during the Spring. Include website and E-mail addresses in the newsletter and encourage readers to use them.

● Send two direct-mail postcards a year. These postcards will announce sales or simply contain a greeting.

● Hold two special sales or celebrate two unusual holidays a year. Use the Spring Equinox to mark a special sale or Back-to-School week to sell school and office supplies.

● Create a monthly electronic newsletter. Will be used as a marketing strategy to update consumers on new inventory and sale items.

Promotional Budget

How much will you spend on the items listed above?

Before startup? (These numbers will go into your startup budget.)

Ongoing? (These numbers will go into your operating plan budget.

Pricing Strategy

As an emerging company, EduCycle will use a variety of pricing strategies to increase market share. The following strategies will prove advantageous to our organization.

Market Penetration Pricing: A pricing technique which involves setting a relatively low initial entry price, often lower than the eventual market price, to attract new customers. The strategy works on the expectation that customers will switch to the new brand because of the lower price. EduCycle’s inventory will be priced relatively lower than the market price to draw in new customers. This strategy will allow EduCycle to increase market share and sales volume as it is commonly employed by businesses launching new goods and services into the marketplace.

Advantages:

● Targets price sensitive customers, which will attract new buyers●● Creates positive branding with new customers who will share the opinions with

potential customers

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●● Blocks or delays the competition

.Block Pricing: A pricing strategy in which identical products are packaged together in order to enhance profits by forcing customers to make an all or none decision to purchase.Advantages:

● Caters to the educators who frequently purchase items in bulk.● Company sells a higher volume of merchandise

Commodity Bundling: The practice of bundling several different products together and selling them at a single bundle price.Advantages:

● Educators often need to purchase multiple products to serve a single purpose (i.e. computer, printer, ink cartridges)

● Generates higher revenue

Price Lining: The practice of offering merchandise in a given category at certain prices.

○ Microscopes at $25, $35, $50○ Upper tier is better quality premium brand○ Middle tier is for average priced brands○ Lower tier for price-conscious customers.

Advantage:● Provides pricing options for a variety of customers

Pricing will be an important factor in giving EduCycle a competitive edge. Our products will be priced significantly lower than the competition. This is based on the premise that our clients may be facing budget constraints. As a non-profit, EduCyle seeks to provide clients with necessary educational resources at prices considerably lower than major retailers.

Proposed Location

Yes. It’s important because of school hours educators need to be able to quickly access the store after or during school hours.

The place of business must be convenient to our members/constituents. The interior spaces must be well-lit, clean, well-organized and inviting for the surplus store. The location should be in the central baltimore city corridor or within the 695 beltway ring.

The image of the storefront should be minimalist, clean, open airy and well-lit and organized.

The store will be fully-stocked and organized and accessible.

Competition exists in the form of physical stores such as retailers and other surplus agencies. Our vicinity to them will drive foot traffic, however it is not critical to the success of our organization.

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Sales ForecastNow that you have described your products, services, customers, markets, and marketing plans in detail, it’s time to attach some numbers to your plan. Use a sales forecast spreadsheet to prepare a month-by-month projection. The forecast should be based on your historical sales, the marketing strategies that you have just described, your market research, and industry data, if available.

You may want to do two forecasts: 1) a "best guess", which is what you really expect, and 2) a "worst case" low estimate that you are confident you can reach no matter what happens.

Remember to keep notes on your research and your assumptions as you build this sales forecast and all subsequent spreadsheets in the plan. This is critical if you are going to present it to funding sources.

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http://www.google.com/url?q=http%3A%2F%2Fwww.score.org%2Fdownloads%2F12%2520Month%2520Sales%2520Forecast1.xls&sa=D&sntz=1&usg=AFQjCNEWTJ7wl-X9tHEizYcY1rRoaLKf7A




Operational Plan

EduCycle will operated as a surplus store and reclamation center. The surplus store will exist virtually and physically. The virtual surplus store will allow members and the general public to shop on the EduCycle website. Members only will have the privelege of requesting that an item be made available for them for pick-up in the store for a (48 hour holding period only). The physical store(s) will have a storefront and a warehouse for storing unprocessed donations and goods that have come in. With the help of volunteers and staff, unprocessed goods will be salvaged, catalogued, labeled, priced and then organized in the warehouse reclamation center for presentation in both the physical and virtual store.

EduCycle will be operated with the combination of paid staff and volunteers. Staff and volunteers will be needed to operate the surplus store(s) and the reclamation centers.

Because there will be a surplus store and a reclamation center, the location of EduCycle will have to be sensitive to the commercial and industrial zoning rules of the area. It’s possible that the reclamation center and the surplus store(s) may exist in separate locations to keep costs low and to meet the needs of the targeted customers.

ProductionMost of the products received will be in-kind donations from vendors, companies, organizations or individuals. We will supplement the our inventory with the purchase of highly desired items when there is a demand on a case per case basis.

Because products are not going to be manufactured but reclaimed or bought at wholesale the costs for production will be minimal and on directly related the costs of the wholesale items and the other operational costs for the reclamation center.

In the reclamation center, items will be processed in stages to ensure quality control. The definitions below based on guidelines established in the 1990 Joint Industry Report for Product Reclamation Centers (“JIR”) will help our staff and volunteers identify items that will not be made available in our surplus store or accepted as an in-kind donation from donors as well as terminology to be used to refer to the unprocessed and processed items.

Unuseable- items removed from the reclamation center or not accepted as a donation because they are determined to be unfit. Types of unuseables included in this Reclamation Policy include (but not limited to):

● Unlabeled or mislabeled product● Improperly sealed product● Over/short weight or partially filled product● Broken glass● Crushed, dented, or collapsed product● Swollen cans● Manufacturer withdrawal● Moldy package● Rusted can● Leakers

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● Soiled, stained, sticky, etc.● Defaced● Expired product or date sensitive product● Spoiled or perishable frozen/refrigerated grocery

Pre-Damage Direct Product Costs (Pre-Damage DPC)– Handling and storage costs that occur before damage is identified as an item moves through surplus distribution. These costs include costs incurred at the warehouse/reclamation center, during transportation to the store, and at the store itself.

Post-damage Handling Costs (Post-Damange Handling) – Costs that typically occur after damage to the item has been identified and before it arrives at the reclamation center. These costs also include costs for handling items that have been identified as damaged in the warehouse.

Reclamation Center Processing Costs – Handling and storage costs that occur as an item is processed through a reclamation center. Contained in this formula are major variables such as reclamation center efficiencies, type of product and processing chutes.

A. Reclamation Program Invoice Cost: Based on EduCycle’s Supplier list cost.Pre-Damage DPC: Based on JIR guidelines (approximately 6% of the list cost)Post Damage Handling: $.128 per item (JIR guideline)

Reclamation Center Costs:Operations Through Scan: $.15 per item. (JIR guideline)Processing Chute: Based upon Supplier disposition.

Processing Chutes :Recycle: $.050 per itemDisposal: $.070 per itemSalvage: $.040 per item

After items have been identified as salvageable, they will be labeled with an EduCycle inspection sticker, then sorted, organized and scanned for tracking in the inventory database.

EduCycle staff and volunteers are committed to excellent customer service by providing members with a set of services that ensure educational or recreational goals are being met.

Services for members include :

● In-Store pickup● New arrival notification● Project Ideas and Service Learning Showcase● Craft Workshops● Inventory control

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Inventory will be tracked electronically with an inventory database which will deliver real-time availability for items made available in the virtual surplus store. All salvaged items will be identified with a EduCycle label to ensure that they have been quality controlled and are ready to be sold in the surplus store(s).

Products will be procured through donations and wholesale distributors.

LocationWhat qualities do you need in a location? Describe the type of location you’ll have.

There are two scenarios for operation of the warehouse/reclamation and surplus store. Scenario 1 : The warehouse/reclamation center can be in a separate location of the surplus store. Scenario 2: The warehouse/reclamation center and surplus store are in the same location. In either location the warehouse/reclamation

Warehouse/Reclamation Center

Physical requirements:

● Amount of space = at least 1500 sq. ft● Type of building = warehouse with loading dock● Zoning = industrial● Power and other utilities = electricity/water/waste disposal/recycling/bathroom

Surplus Store (physical)

Physical requirements:

● Amount of space = at least 500 sq. ft● Type of building = storefront● Zoning = commercial● Power and other utilities = electricity/water/waste disposal

Access:

Is it important that your location be convenient to transportation or to suppliers?

Due to the need for the shipping and receiving of donations and transportation of items between surplus store (depending on the scenario) the location of the warehouse/reclamation must be accessible to trailer trucks, forklifts, dump trucks and other industrial equipment. The surplus store will need to be accessible to members to shop.

Do you need easy walk-in access?

Walk-in access for the store is imperative; for the reclamation center walk-in access is secondary.

What are your requirements for parking and proximity to freeway, airports, railroads, and shipping centers?

For the surplus store the parking should be easy for members and non-members to have access to the store. For staff and volunteers there should be designated parking. For the warehouse/reclamation center parking for staff and volunteers should be designated.

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Include a drawing or layout of your proposed facility if it is important, as it might be for a manufacturer.

Scenario 1: Separate Warehouse/Reclamation Center and Surplus Store

Scenario 2: Combined Warehouse/Reclamation Center and Surplus Store

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Cost: Estimate your occupation expenses, including rent, but also including maintenance, utilities, insurance, and initial remodeling costs to make the space suit your needs. These numbers will become part of your financial plan.

Scenario 1: Separate Warehouse/Reclamation and Store

Warehouse/reclamation costs

Rent: $14 - $40 sq/ft * 1500 sq ft. = $21,000 - $60, 000 annually or $1750 - $5000 monthly

Electricity: $500 - $1000 monthly

Water: ?

What will be your business hours?

7am - 7pm Mon - Fri

8am - 4pm Sat & Sun

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Legal Environment

Describe the following:

● Licensing and bonding requirements● Permits● Health, workplace, or environmental regulations● Special regulations covering your industry or profession● Zoning or building code requirements● Insurance coverage● Trademarks, copyrights, or patents (pending, existing, or purchased)

Personnel

● Number of employees● Type of labor (skilled, unskilled, and professional)● Where and how will you find the right employees?● Quality of existing staff● Pay structure● Training methods and requirements● Who does which tasks?● Do you have schedules and written procedures prepared?● Have you drafted job descriptions for employees? If not, take time to write some. They

really help internal communications with employees.● For certain functions, will you use contract workers in addition to employees?

Inventory

● What kind of inventory will you keep: raw materials, supplies, finished goods?● Average value in stock (i.e., what is your inventory investment)?● Rate of turnover and how this compares to the industry averages?● Seasonal buildups?● Lead-time for ordering?

SuppliersIdentify key suppliers:

● Names and addresses● Type and amount of inventory furnished● Credit and delivery policies● History and reliability

Should you have more than one supplier for critical items (as a backup)?

Do you expect shortages or short-term delivery problems?

Are supply costs steady or fluctuating? If fluctuating, how would you deal with changing costs?

Credit Policies

● Do you plan to sell on credit?

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● Do you really need to sell on credit? Is it customary in your industry and expected by your clientele?

● If yes, what policies will you have about who gets credit and how much?● How will you check the creditworthiness of new applicants?● What terms will you offer your customers; that is, how much credit and when is payment

due?● Will you offer prompt payment discounts? (Hint: Do this only if it is usual and customary

in your industry.)● Do you know what it will cost you to extend credit? Have you built the costs into your

prices?Managing Your Accounts Receivable

If you do extend credit, you should do an aging at least monthly to track how much of your money is tied up in credit given to customers and to alert you to slow payment problems. A receivables aging looks like the following table:

Total Current 30 Days 60 Days 90 DaysOver 90 Days

Accounts Receivable Aging

You will need a policy for dealing with slow-paying customers:

● When do you make a phone call?● When do you send a letter?● When do you get your attorney to threaten?

Managing Your Accounts Payable

You should also age your accounts payable, what you owe to your suppliers. This helps you plan whom to pay and when. Paying too early depletes your cash, but paying late can cost you valuable discounts and can damage your credit. (Hint: If you know you will be late making a payment, call the creditor before the due date.)

Do your proposed vendors offer prompt payment discounts?

A payables aging looks like the following table.

Total Current 30 Days 60 Days 90 Days Over 90 Days

Accounts Payable Aging

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Management and Organization

Professional and Advisory SupportList the following:

● Board of directors (5 members = 3 quorom)● position descriptions for :

○ Executive Director○ Director of Operations○ Director of Development (optional)○ Office Manager○ Warehouse Manager○ Administrative Assistant ○ Warehouse Clerk

Job Titile: Executive Director

Function: · To implement the strategic goals and objectives of the organization

· With the chair, enable the Board to fulfill its governance function

· To give direction and leadership toward the achievement of the

organization's philosophy, mission, strategy, and its annual goals and

objectives

Reports to: Board of Directors

Major Functions/Accountabilities:

1. Board Administration and Support -- Supports operations and

administration of Board by advising and informing Board members,

interfacing between Board and staff, and supporting Board's evaluation

of chief executive

2. Program, Product and Service Delivery -- Oversees design,

marketing, promotion, delivery and quality of programs, products and

services

3. Financial, Tax, Risk and Facilities Management -- Recommends

yearly budget for Board approval and prudently manages

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organization's resources within those budget guidelines according to

current laws and regulations

4. Human Resource Management -- Effectively manages the human

resources of the organization according to authorized personnel

policies and procedures that fully conform to current laws and

regulations

5. Community and Public Relations -- Assures the organization and its

mission, programs, products and services are consistently presented in

strong, positive image to relevant stakeholders

6. Fundraising (nonprofit-specific) -- Oversees fundraising planning

and implementation, including identifying resource requirements,

researching funding sources, establishing strategies to approach

funders, submitting proposals and administrating fundraising records

and documentation.

Job Description Director of Operations

The Director of Operations will be responsible for enhancing the internal organization processes and infrastructure that will allow EduCycle to continue to grow and fulfill its mission. The Director of Operations will manage the following functions:

Financial Management and Oversight

Working with the Director of Finance, manage and oversee all financial and business planning

activities, including:

o Direct and administer all financial plans

o Oversee business policies and accounting practices

o Review and analyze financial reports

o Support and advise the Executive Director in decision making

o Lead and support organizational budgeting proces

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Oversee reporting and monitoring of organizational performance metrics.

Provide overall financial oversight and monitoring.

Ensure that relevant financial data is presented to the Executive Director.

Human Resources

Works to manage and oversee the human resource function for EduCycle, including:

o Recruitment, hiring, and compensation

o Benefits administration and oversight

o Professional training and development, including new employee orientation

o Retention strategies

o Regulatory oversight and legal compliance

Ensuring that the human resource function is properly resourced and represented within the

senior management team.

Operations

Oversee risk management and legal activities: letters of agreement, contracts, leases, and other legal documents and agreements

Business insurance: procurement, monitoring and management

Information technology – works to ensure the ongoing maintenance and updating of information systems and infrastructure, including hardware and software.

Organizational reporting and monitoring: provide guidance and leadership through management of the EduCycl metrics and measurement reporting process

Office management: oversee administrative functions for EduCycle office and warehouse

Ensure the smooth daily operations of EduCycle

Board of directors – works with the Executive Director to provide staff support and guidance to EduCycle. Acts as staff liaison to relevant board committees

Qualifications

Minimum of a BA, ideally with an MBA

Strong operational experience: ideally has worked in a senior management role for 10+ years in a

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socially responsible organization with progressive experience leading to at least three years

experience in operational/administrative management

Demonstrated experience in financial planning and analysis with previous experience overseeing human resources, information technology, and legal

Job Description Office Manager

The Office Manager reports to the Senior Administrative Officer and is responsible for providing

office management services to the First Nations Office. This includes maintaining office services

and efficiency, supervising office staff and maintaining office records.

RESPONSIBILITIES

(Major responsibilities and target accomplishments expected of the position including the typical problems

encountered in carrying out the responsibilities.)

1. Maintain office services

Main Activities:

Design and implement office policies

Establish standards and procedures

Organize office operations and procedures

Supervise office staff

Monitor and record long distance phone calls

Prepare time sheets

Control correspondences

Review and approve supply requisitions

Liaise with other agencies, organizations and groups

Update organizational memberships

Maintain office equipment

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2. Supervise office staff

Main Activities:

Assign and monitor clerical and secretarial functions

Recruit and select office staff

Orient and train employees

Provide on the job and other training opportunities

Supervise staff

Evaluate staff performance

Coaching and disciplining staff

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Personal Financial StatementInclude personal financial statements for each owner and major stockholder, showing assets and liabilities held outside the business and personal net worth. Owners will often have to draw on personal assets to finance the business, and these statements will show what is available. Bankers and investors usually want this information as well.

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Startup Expenses and CapitalizationYou will have many startup expenses before you even begin operating your business. It’s important to estimate these expenses accurately and then to plan where you will get sufficient capital. This is a research project, and the more thorough your research efforts, the less chance that you will leave out important expenses or underestimate them.

Even with the best of research, however, opening a new business has a way of costing more than you anticipate. There are two ways to make allowances for surprise expenses. The first is to add a little “padding” to each item in the budget. The problem with that approach, however, is that it destroys the accuracy of your carefully wrought plan. The second approach is to add a separate line item, called contingencies, to account for the unforeseeable. This is the approach we recommend.

Talk to others who have started similar businesses to get a good idea of how much to allow for contingencies. If you cannot get good information, we recommend a rule of thumb that contingencies should equal at least 20 percent of the total of all other start-up expenses.

Explain your research and how you arrived at your forecasts of expenses. Give sources, amounts, and terms of proposed loans. Also explain in detail how much will be contributed by each investor and what percent ownership each will have.

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Financial PlanThe financial plan consists of a 12-month profit and loss projection, a four-year profit and loss projection (optional), a cash-flow projection, a projected balance sheet, and a break-even calculation. Together they constitute a reasonable estimate of your company's financial future. More important, the process of thinking through the financial plan will improve your insight into the inner financial workings of your company.

12-Month Profit and Loss ProjectionMany business owners think of the 12- month profit and loss projection as the centerpiece of their plan. This is where you put it all together in numbers and get an idea of what it will take to make a profit and be successful.

Your sales projections will come from a sales forecast in which you forecast sales, cost of goods sold, expenses, and profit month-by-month for one year.

Profit projections should be accompanied by a narrative explaining the major assumptions used to estimate company income and expenses.

Research Notes: Keep careful notes on your research and assumptions, so that you can explain them later if necessary, and also so that you can go back to your sources when it’s time to revise your plan.

Four-Year Profit Projection (Optional)The 12-month projection is the heart of your financial plan. The Four - Year Profit projection is for those who want to carry their forecasts beyond the first year.

Of course, keep notes of your key assumptions, especially about things that you expect will change dramatically after the first year.

Projected Cash FlowIf the profit projection is the heart of your business plan, cash flow is the blood. Businesses fail because they cannot pay their bills. Every part of your business plan is important, but none of it means a thing if you run out of cash.

The point of this worksheet is to plan how much you need before startup, for preliminary expenses, operating expenses, and reserves. You should keep updating it and using it afterward. It will enable you to foresee shortages in

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time to do something about them—perhaps cut expenses, or perhaps negotiate a loan. But foremost, you shouldn’t be taken by surprise.

There is no great trick to preparing it: The cash - flow projection is just a forward look at your checking account.

For each item, determine when you actually expect to receive cash (for sales) or when you will actually have to write a check (for expense items).

You should track essential operating data, which is not necessarily part of cash flow but allows you to track items that have a heavy impact on cash flow, such as sales and inventory purchases.

You should also track cash outlays prior to opening in a pre-startup column. You should have already researched those for your startup expenses plan.

Your cash flow will show you whether your working capital is adequate. Clearly, if your projected cash balance ever goes negative, you will need more start-up capital. This plan will also predict just when and how much you will need to borrow.

Explain your major assumptions, especially those that make the cash flow differ from the Profit and Loss Projection. For example, if you make a sale in month one, when do you actually collect the cash? When you buy inventory or materials, do you pay in advance, upon delivery, or much later? How will this affect cash flow?

Are some expenses payable in advance? When?

Are there irregular expenses, such as quarterly tax payments, maintenance and repairs, or seasonal inventory buildup, that should be budgeted?

Loan payments, equipment purchases, and owner's draws usually do not show on profit and loss statements but definitely do take cash out. Be sure to include them.

And of course, depreciation does not appear in the cash flow at all because you never write a check for it.

Opening Day Balance SheetA balance sheet is one of the fundamental financial reports that any business needs for reporting and financial management. A balance sheet shows what items of value are held by the company (assets), and what its debts are

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(liabilities). When liabilities are subtracted from assets, the remainder is owners’ equity.

Use a startup expenses and capitalization spreadsheet as a guide to preparing a balance sheet as of opening day. Then detail how you calculated the account balances on your opening day balance sheet .

Optional: Some people want to add a projected balance sheet showing the estimated financial position of the company at the end of the first year. This is especially useful when selling your proposal to investors.

Break-Even AnalysisA break - even analysis predicts the sales volume, at a given price, required to recover total costs. In other words, it’s the sales level that is the dividing line between operating at a loss and operating at a profit.

Expressed as a formula, break-even is:

Break-Even Sales =

Fixed Costs

1- Variable Costs

(Where fixed costs are expressed in dollars, but variable costs are expressed as a percent of total sales.)

Include all assumptions upon which your break-even calculation is based.

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AppendicesInclude details and studies used in your business plan; for example:

● Brochures and advertising materials● Industry studies● Blueprints and plans● Maps and photos of location● Magazine or other articles● Detailed lists of equipment owned or to be purchased● Copies of leases and contracts● Letters of support from future customers● Any other materials needed to support the assumptions in this

plan● Market research studies● List of assets available as collateral for a loan

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edu cyclebusinessplan revised

Business

educyle business plan

community organizations

financial plan

business goals of educycle

educational media

marketing plan

operational plan

community education