People have a look at this, we need 15 to 20 housed to get this off the ground. Phoenix Modular Homes Business Plan PO Box: 143 Fort Alexander, MB R0E 0P0 Phone (204) 367 2530 Executive Summary: Phoenix Housing is a Company No. 6665200 Manitoba Ltd., owned by members from the Sagkeeng First Nation. The partners have identified an opportunity for the new company to pursue: a Ready-to-Move (RTM) home manufacturing operation; The partnership is pursuing RTM home manufacturing in the near term while looking at the training facility as longer term initiatives. This business plan describes, in detail, the operational and financial outcomes of the RTM home manufacturing business. Phoenix manufactured homes will be constructed in an indoor production facility, producing high quality, affordable finished homes. Phoenix proposes to build and operate an RTM manufacturing business aimed at meeting the needs of area First Nation communities. Phoenix will also sell RTM homes to be used as “turnkey” cottages and as homes to be sold in the surrounding municipal areas. Housing in First Nation communities has been a significant concern for years. Although annual government funding is provided to bands for new houses, a major housing shortage still exists. Most First Nations prefer to combine the need for houses with providing employment by hiring individuals within the community to construct houses on-site. While this provides employment for a few months of the year, challenges with cost overruns, weather, labour, material costs and transportation, quality, and theft occur with on-site construction. Located on the Winnipeg river, is the gateway to “East Side Lake Winnipeg” cottage country. The lake has attracted many to its shore for years. Although the wilderness makes for ideal cottage locations, they make it difficult to bring in supplies. Demand and the geography make it difficult to coordinate contractors in a timely fashion. Prefabricated housing solves these problems by bringing the finished product to the customer while using centrally located labour and supplies. First Nation housing needs in the surrounding area of operation will be approximately 95 houses annually. Anecdotal evidence supports the construction of 30-40 cottages in the area each year. Overall, 150 to 160 homes or cottages are built each year; Phoenix estimates they will build 25 homes in the first year for a market share of approximately 10%. By the fifth full year of operation management projects they will sell and build 30 homes for a market share of approximately 20%. Training Part of Phoenix’s overall plan is to establish a training facility that will allow members from the surrounding First Nation communities to receive the training and education required to become skilled and certified trades-people. Trades may include, but are not limited to: electricians, carpenters, drywallers, roofers, plumbers, tin fasteners, floorers and framers. The partnership facilitates the ability to leverage the potential of First Nation communities by developing and utilizing the potential workforce that resides in local First Nation communities. Facilities Phoenix is in the process of purchasing a currently available 67 acre site and 150 x 200 square foot building approximately 14 km east of the Sagkeeng First Nation. The site can be modified and renovated to meet the needs of the RTM business. The site is well maintained and will require very little preparation to meet the needs of the RTM business. Financial Projections “Other equipment” is made up of mostly office equipment such as furniture, computers, drafting tables and printers. Tools for the RTM operation are expected to total $280,000. Capital for the RTM operation is estimated at $630,000 for a total capital need of $126,000. The business plans to split the capital need with 20% equity leaving 80% to be financed through debt. Total revenues in the first full year of operations are approximately $3.75 million growing to approximately $4.22 million five years later. Gross margin is estimated to be 36% net income grows from $991,800 to approximately $1,126,922 over that same period. Cash flow in positive in each year, growing from $1,000,095 in the first year to more that $4,596,781 in the fifth year. The current ratio (measurement of current assets divided by current liabilities) grows from 59.5 in the first year to 98.3 in year 5. Average return on equity for the business is 68% annually.
Posted on: Fri, 15 Aug 2014 19:57:08 +0000
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