KIPS: A Proposed Business Plan

ADAMSON University College of Engineering Civil Engineering Department CE 431- Elective 3: Entrepreneurship for Civil Engineers Proposed Business Plan

KIPS RENTAL

PRESENTED BY: SOBRECAREY, KYLE P. Presented to: Dr. Tomas U. Ganiron Jr. Professor, Entrep. for C.E.

TABLE OF CONTENTS • • • • • • •

EXECUTIVE SUMMARY COMPANY DESCRIPTION SERVICES MARKET ANALYSIS MARKETING STRATEGY AND IMPLEMENTATION ORGANIZATION AND MANAGEMENT FINANCIAL PLAN

EXECUTIVE SUMMARY • KIPS Construction Equipment Rental Company is the construction heavy

equipment rental business such as bulldozer, excavators, tower crane, dump truck and wheel loader based in the Philippines. We offer flexible terms for your equipment leasing needs. We have monthly, weekly, daily rates, even hourly rates that are configurable to suit all your project requirements.

OBJECTIVE THE OBJECTIVE OF KIPS CONSTRUCTION EQUIPMENT RENTAL

• To meet the customer satisfaction by providing the highest quality of services and products.

• To continously enhance our quality management system.

• To understand, anticipate and meet unique requirements of customers

MISSION Our mission as a rental company is to create a better service for many people. Build the best service, cause no unnecessary harm, use business to inspire and implement solutions to the construction crisis. And to ensures that the on-going construction is making progress with ease with this heavy-duty equipment.

GUIDING PRINCIPLES • OUR SERVICES - To enlighten them with the knowledge on how to properly use this heavy-duty equipment to avoid unnecessary accidents, and for the safety of others.

• GRATITUDE - Let the feel your sincere gratitude, show them that this company is worth it, so that they can feel the warm and friendly environment and are willing to return to the company.

• BEING MINDFUL - Always place the priorities of the customers and the employees at the top of the list.

Because without them, there is no business.

KEYS TO SUCCESS • Excellent products and services that will build and maintain customer loyalty.

• A business location that will assure high company visibility and a high flow of customers.

• Proven management ability to successfully run a similar business.

• Our commitment to continuous improvement and total quality services.

COMPANY DESCRIPTION The KIPS Construction equipment rental will be located in Tanauan Batangas, wherein the clients can easily get their equipment due to the wide land space. The company will be fully owned by Sobrecarey, Kyle P.

The company will be open 6 days a week with hours as follows: DAY

TIME

MONDAY

8:00 AM – 5:00 PM

TUESDAY

8:00 AM – 5:00 PM

WEDNESDAY

8:00 AM – 5:00 PM

THURSDAY

8:00 AM – 5:00 PM

FRIDAY

8:00 AM – 5:00 PM

SATURDAY

8:00 AM – 4:00 PM

OWNERSHIP The company will be owned by Sobrecarey, Kyle.

Kyle is currently taking up Civil Engineering in Adamson University, he hopes that in 2020 he would be a degree holder. And establish his business in the following years to come. Having a bit of knowledge in construction, he plan on helping those company that are lacking heavy-duty equipment and power.

LEGAL FORM KIPS Construction equipment rental will be organized by a sole proprietorship, wholly owned and operated by Sobrecarey, Kyle. KIPS rental will be registered in Batangas,

START-UP SUMMARY The estimated capital needed is Php 65 million.

The cost for the company itself, the employees, the equipments, and as well as the lands and its location. Bank loans will be needed for the estimated capital. And for the remaining capital will be funded by the owners own salary and sponsors, for a long term plan.

LOCATION AND FACILITIES The company will be located in Batangas, where the lands are very wide for the equipments to be placed, and the demand for the equipments is very high, due to the on-going constructions, not just in Batangas, but the cities and provinces surrounding it.

And the equipments needs to be stored in a large warehouse so that it can be clean and ready to use.

SERVICES The KIPS Construction equipment rentals will provide a high quality of reliable and construction well maintained heavy equipment for construction.

Including cranes, excavator, bulldozer, wheel loader and trailer truck. Our services include training and product demonstrations, as well as informetion on the latest market trends in the construction industry.

PRODUCT • The KIPS Construction equipment rentals will carry a variety of quality

products what will enable us to provide full service delivery to companies.

Our underlying philosophy in selecting products is to choose lines that will bring consistent quality, competitive prices, and product satisfaction t our clients or customers. We have personally researched and examined each of the following products that we offer to ensure the quality we guarantee.

PRODUCT Our products includes:

• BULLDOZER

PRODUCT • EXCAVATOR

PRODUCT • TOWER CRANE

PRODUCT • WHEEL LOADER

PRODUCT • TRAILER TRUCK

PRODUCT • DUMP TRUCK

PRODUCT At this time, the majority of these products or equipment are available in Caterpillar stores and also in some of other second hand sellers of equipments.

The KIPS Construction equipment rentals will make these products or equipments available through our high quality, full service delivery, bringing them to your construction sites.

COMPETITIVE COMPARISON • Guzent Inc. - Construction Equipment Sales & Rentals - Guzent Inc. offers sales and rental of construction equipment in the Philippines. Based in 1237 EDSA, Balintawak, Quezon City, Metro Manila, Philippines, Guzent Inc., offers cranes, boom trucks, power

• JMC KONSTRUKT, INC. - JMC KONSTRUKT is known as a multi-faceted excavation contractor and one of the heavy/base landscaper in Cebu, Philippines. With its Office located in Metro Mandaue, Cebu City, offers a full range of services including: excavation, site development, demolition, rental equipment provider for heavy excavation and dumps, underground utilities work, grading and erosion control, delivery & disposal of fill material. With its maintenance shop located in Liloan, Cebu traditionally performs work in the Visayan Region, primarily the Province of Cebu, Bohol and Negros.

COMPETITIVE COMPARISON • Northway Automotive & Machinery Recon Center - Construction Equipment and heavy equipment: mixers, compactors, vibrators, cutters, breakers.

• Golden Dragon Corporation - One of the leading construction firm in providing general construction, foundation works, ports and harbor and horizontal construction. The company has earned trust and satisfaction from local and international clients.

They have 12 types of machines and 10 kinds of equipment per type of machines

SUPPLIERS The KIPS Construction Equipment Rentals will purchase equipments directly from manufacturers. Because this will cut off the broker or middle man fees, this allows us to reduce some expenses, while providing our customers with competitive prices.

MANAGEMENT CONTROLS • The management ensures the safety of the clients and workers safety.

• Will have a training seminars for the equipments, to ensure the workers can operate the equipment properly

• Will conduct a toolbox meeting twice a week

FUTURE SERVICES • The KIPS Construction equipment rentals intend to expand its doors to

become a nationwide company and after maybe 10 years it will become a known provider for the whole Asia. We will also offer a showroom that will feature equipment, supplies and information on marketing services with examples of marketing and promotional material available to customers.

• With the addition of the product showroom, The KIPS Construction

equipment rentals will offer customers training demonstrations what will be presented by trained equipment experts fron the industry.

MARKET ANALYSIS • The company expects to participate in a variety of different industries,

including commercial and residential construction and farm machinery. The following sections will describe the industries in which KIPS Equipment Rental Company hopes to compete.

• The boom in the area is primarily in response to new business and

employment opportunities in the area. Similar rental service businesses that traditionally do well with this population have proved the potential for KIPS Equipment Rental Company.

INDUSTRY ANALYSIS • The equipment rental business is one of the business that is always on

demand and that is because most of construction business does not have the need to buy or the means to have such equipment, they just rely to companies like ours.

• Also, some of the heavy equipment are used few times by the last users and there is no need to waste money on buying equipment to use only once or twice that’s why business rental companies are known in this kind of situations. In this line of business entrepreneurs must have the ability or innovative ideas to stay on top of the line.

MARKET SEGMENTATION Next illustration shows the market segmentation, gives the total potential number of businesses that could rent our equipment in the local area. Most of our equipment that could rent is the construction industry about 64 percent while in mining industry about 25 percent and in agricultural industry about 11 percent.

Market Analysis Agricultural Industry 11%

Construction Industry Mining Industry Agricultural Industry

Mining Industry 25%

Construction Industry 64%

TARGET MARKET SEGMENT STRATEGY There are all sorts of people who make rent equipment for several purposes; this means that we cannot restrict our customers to a certain group as we have a huge target market to cater here in the Philippines. Asides from having a large number of potential customers, we are also strategically located here in Batangas, and have also chosen several other strategic locations in which to create awareness about heavy equipment rental.

COMPETITIVE EDGE • • • •

Purchase additional equipment.

Increase Advertising.

Obtain financing.

Hire more employee

SALES STRATEGY • KIPS Equipment Rental Company is a new entity, we recognize that we will

need to prove our company’s worth to our customers and Investors, in order to earn respect and business.

• Consistent, customer centric service is the absolute requirement in the hospitality industry, and so it is for all our employees.

ORGANIZATION SOBRECAREY, KYLE P. PRESIDENT MANAGER OF FINANCE

• ACCOUNTANT • PURCHASING MANAGER • MARKETING EXECUTIVES

MANAGER OF SERVICE AND LABOR

• RENTAL AND LEASING MANAGER • TRUCK DRIVERS • HR AND ADMIN MANAGER • MAINTENANCE MANAGER

MANAGEMENT TEAM KIPS started since the owner was concerned about establishing a business. After long planning KIPS decided to consult those who is successful in this business industry

MANAGEMENT TEAM GAPS We depend on our professionals for some key management tips.

We don’t have a strong background in preventive maintenance for our equipments. As we grow, we need to develop more manufacturing techniques and more mass production.

•Import Assumption

FINANCIAL PLAN IMPORTANT ASSUMPTIONS

Year 1

Year 2

Year 3

1

2

3

00%

10.00%

10.00%

10.00%

10.00%

10.00%

12.00%

12.00%

12.00%

P l a n Month Current Interest

10.

Rate Long – T e r m Interest Rate T a x Rate

BREAK-EVEN ANALYSIS

THE END