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Entrepreneurship Written Event
AmoLines Air Service
Crater DECACrater High School
655 North Third Street
Central Point, OR 97502
James Amidon
January 2011
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Table of Contents
I. Executive Summary ........................................................................................1
II. Introduction.....................................................................................................2
III. Analysis of the Business Situation..................................................................3
A. Self Analysis ................................................................................................3
B. Trading Area Analysis .................................................................................4
C. Market Segment Analysis............................................................................7D. Analysis of Potential Location.....................................................................9
IV. Planned Operation of the Proposed Business ...............................................10
A. Proposed Organization.........................................................................10
B. Proposed Services................................................................................12C. Proposed Marketing Strategies ............................................................13
V. Planned Financing.........................................................................................15
A. Projected Income and Expenses...........................................................15
B. Proposed Plan to Meet Capital Needs..................................................18
VI. Conclusion ....................................................................................................18
VII. Bibliography .................................................................................................19
VIII. Appendix.......................................................................................................21
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I. Executive Summary
The Rogue Valley has a tradition of flying. The first ever airport in the state ofOregon was in built in Medford in 1926. Since, the airport has gone through renovations,renaming and a slew of commercial carriers dating to 1931 when United Airlines wasfounded from a local air transportation operation known as Pacific Air Transport.
From those humble beginnings, Medford put itself on the map as a hub for airtravel. Now, as general aviation is booming nationwide, the Rogue Valley has been leftbehind. Why? There are no flight schools and no forum to educate aspiring pilots. All thefixed base operators in the area abandoned the loss leading education operations in favorof the bottom line. AmoLines will use outreach as part of our promotional activities toearn the loyalty of our community. With our education division, we will teach young andold the joys of flying, and reap the rewards of a true FBO with communal ties.
Our three company divisions have three separate markets, appealing to manytypes of people. The estimated target market for our educational programs totals aroundfifty-eight thousand with a demographic multiplier derived ETM of close to fifteenhundred. If we can reach just ten percent of that available market, we will not only have a
successful educational program, but dramatically increase our customer base for aviationservices. The derived ETM for our aviation services market totals 12,600, a heftycustomer base if we can effectively reach them and fulfill all their aviation needs. Our aircharter division, encompassing the smallest market segment, will undoubtedly be ourmost profitable due to the inherent expense of luxury air travel.
We will also reach the general aviator with our air charter services by offeringplane rentals (currently non-existent in the Rogue Valley) and hangaring and tie-downstorage services. Other services AmoLines will offer include fueling and aircraftmaintenance, including avionics installation. To ensure the utmost standard of quality wewill have an Avionics technician on staff as well as an Airframe and PowerplantMechanic who can, when assisted by the both general aircraft maintenance technicians,completely overhaul any aircraft in a timely manner.
With a unique mix of promotions including an open house, airshow and iPhoneapp AmoLines is poised to earn the respect of the community and gain the business ofour competitors through hard work and honest means. We will continually reviewourselves alongside our competition to ensure the most complete and satisfyingexperience for every single customer.
Organizationally, with a triumvirate of owners and Aviation (General) Manager,we will strive because of teamwork and effective management. There exists clear pathsand hierarchy through which communication can be transferred and used effectively toimprove upon our business operations.
When analyzing a young company, a realistic financial projection is essential.AmoLines will lose money over the course of a few slower months; but, in the course ofthe first three years we will earn in upwards of $1.6 million net profit with gross salestotaling approximately $6 million annually. In order to achieve this, we need capitalinvestment. We are seeking a business loan of $2 million amortized over five years at4.75 A.P.R. In addition, AmoLines is offering a 49% in exchange for $2 million. Thisventure capital will be returned over the course of eight years while retaining 49%ownership in a successful aviation based company: AmoLine Air Service.
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II. Introduction
AmoLines Air Service is a full-service fixed base operator (FBO) to be located at
the Rogue Valley International Airport in Medford, Oregon. By opening AmoLines, we
will offer services for the leisurely general aviator, professional business transport and
commercial airlines as well as everyone in between. Our mission is to be the premier
aviation services provider for the region between Portland and the San Francisco Bay
Area, serving airmen with a wide array of amenities to fulfill their flying needs.
With three different company divisions: Education, Air Charter, and Aviation
Service, we offer a full range of services for general aviation and commercial airlines.
Through the educational division, AmoLines will provide ground school, flight school
and all the other support to satisfy FAA certifications for pilots, therefore increasing the
target market for its other services.
The air charter division of AmoLines will provide aircraft rentals, hangaring,
airplane tie-downs and flight charters for patrons. Lastly, the most profitable market is
aviation services which encompass aviation fueling, aircraft mechanics and avionics.
Informational resources for the research of this business plan include a number of
entrepreneurship and business journals, personal interviews, other companies in the
aviation industry and a local demographics firm, Southern Oregon Regional Economic
Development Inc. (SOREDI). For this entrepreneurship written event, my mentors
include: my business teacher Mike Rogan, who helped me with business operations as
well as financials; Bart Lewellyn, a financial advisor who helped with the legality,
financials and requisite business regulations; lastly, my uncle Vic Olson played a large
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part in the development of this project as he has a history in business, aviation and
marketing.
III. Analysis of the Business Situation
A. Self Analysis
I have a broad array of business experience. I am a four-year member of the
Crater School of Business; this program integrates business and technology with studies
in history, economics and English.
Through the School of Business, I have also gained invaluable hands-on
knowledge with internships at Thornton Engineering, Lewellyn Financial Management
and Fidelity Print Quick all in my local area. At Thornton, I learned the value of business
organization and gained a background in engineering and commercial design. With
Lewellyn Financial, I was trained in a number of financial tools and investment vehicles,
gaining a basic understanding of the economics of running a business. Lastly, at Fidelity I
was taught how to effectively communicate goals and promote a business through the
production of ad posters as well as company stationary.
I have a background in aviation: my father, two of my uncles and my grandfather
are all pilots, flying is in my blood. I am currently logging hours in my Pilot Log so I can
take my check flight and attain pilothood. Concurrently, I have been assessing the region
trying to answer why flight training is so hard to come by in the Rogue Valley. The
answer, as I found, was, by itself, pilot education is not profitable; however, when
coupled with other aviation services often found at an FBO, a business can be quite
profitable.
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Lastly, the most important asset I have is my will. I do not give up; I will always
find a way to get the job done. Also, I take healthy risks but never too much as I like to
protect myself against the inevitable. I have the drive to succeed.
My business experience, internships, background in aviation, and drive to succeed
have honed me to found and lead AmoLines to be the premier fixed base operator in the
Rogue Valley, possibly the West Cost.
B. Trading Area Analysis
Nestled between the Cascade Range, the Siskiyou Mountains, and the Coastal
Mountains is the Rogue Valley, a beautiful home to nearly a quarter of a million Southern
Oregonians. Commonly viewing themselves as separate from the rest of the state, the
people of the valley are active in the outdoors with year-round recreation afforded by the
seasonal climate and distinct terrain.
Located at the halfway point between Portland, Oregon and San Francisco, the
Rogue Valley is the only intermediate market other than Redding, California and Eugene,
Oregon along the Interstate 5 corridor linking the two large markets. This area has a
regional hub of Medford, with many suburbs: Ashland, Talent, Phoenix, Jacksonville,
Central Point, White City, Eagle Point, Gold Hill, Rogue River and Grants Pass, roughly
following I-5 from south to north (SOREDI). With several small private airports dotting
the area, the Rogue Valley has an active flying community focused at Medford Airport
(MFR). There are three enterprises with charter services and fuel services; however, there
exists no flight school or airplane rental services at Medford Airport.
The people of the Rogue Valley, nearly 275,000 according to SOREDI, can be
dissected into many partitions such age group, sex, marital status, income and education
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levels when carving out an estimated target market. When analyzing the demographic
data for Jackson County, the estimated target market using mean methods and derived
estimated target market using multiplicative methods for AmoLines Educational division
would be 58,000 and 1500 fifty-eight thousand and fifteen hundred, respectively. In the
same way, our Air Charter market would be ETM = 52,000 and a dETM = 115 and the
Aviation Services market would span ETM = 78,000 and dETM = 13,000 (Factsheet).
Although small, the nature of an expensive marketplace still allows for a favorable
business situation. For more information on the demographics and estimated target
market see Appendix: Market Segments.
Being the high price points and inherent expense among the industry, the gross
income and economics statistics of the Rogue Valley show what should prove to be a
successful venture. More specifically, according to US Census data, a median family
income of fifty-five thousand dollars, allowing monies for spending on leisure and
possibly vocational training. Additionally, the workforce of nearly 98,000 with 88 per
cent having earned a high school diploma (SOREDI), the human resources for AmoLines
are more than existent. As proof of success of the aviation industry in the Medford area,
more than 600 are employed in aviation ventures, most notably the heavy lift helicopter
company Erickson Air-Crane (SOREDI).
In many ways isolated from the rest of Oregon, the region of the Rogue Valley in
the south of the state is a strong community for a new business such as AmoLines Air
Service because of the strategic location midway between two large west coast markets,
its people and their interests, and most importantly economically, the Medford area can
financially support our company.
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AmoLines Air Service will provide a number of services to their customers:
aviation fueling, aircraft maintenance, avionics, air charter, aircraft rentals, hangaring and
tie-downs, and the loss leader of aviation education. As can be seen in the proposed
marketing strategies section, this service of FAA education and certification will only add
to the customer base of the company and earn a loyalty before the competition can
engage the customer.
Company Address Phone Website
MedfordAir Service
4002 Cirrus Drive,Medford, OregonMedford Airport
(541) 779-5451(800) 427-0290
http://www.medfordairservice.com/
Products &Services:
Aviation Fuel & Oil Aircraft Maintenance Hangaring/ Tie-down storage
(Medford Air Service)
Medford Air Service will be the toughest competition as they currently have the
largest market share. The strength of their business is a near monopoly in providing
aviation fuel services. By entering with lower price point we can leverage the market
segment in favor of AmoLines.
Company Address Phone Website
Million Air2040 Milligan Way,Medford, OregonMedford Airport
(541) 842-2254 http://www.millionairmfr.com/
Products &Services:
Air Charter Aviation Fuel & Oil Hangaring/ Tie-down storage
(Million Air)
Million Airs appeal is to the air charter and private business transport market;
offering the tie-down storage for visiting bizjets and refueling services. Otherwise, many
of Million Airs accommodations are through partnership with Superior Air Charter.
Company Address Phone Website
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SuperiorAir
2040 Milligan Way,Medford, OregonMedford Airport
(541) 842-2250(541) 842-2254(888) 842-0550
http://www.flysuperior.com/
Products &Services:
Air Charter Aircraft Sales Aircraft Maintenance
(Million Air)
Superior Air Charter has a niche market stemming from its venture in aircraft
sales. By providing post-transaction maintenance services for their customers, Superior
Air Charter holds on to their established market share in an otherwise bland aviation
services competition.
Our disadvantage is a lack of name recognition and market share. The educational
division of AmoLines Air Service will be the niche through which we gain our market
share. Instead of only fighting for the customers of our competition, we will increase the
market itself relying on our FAA certification programs. Additionally, we will earn a
market share for fueling by offering the superior products of Chevron Global Aviation,
introduced at competitive price points. Our greatest advantage as a company will be the
wide array of products and services we offer when compared to the competition.
C. Market Segment Analysis
With the three distinct divisions, AmoLines is poised to enter the Rogue Valley
marketplace, secure a market share and reap the benefits of a successful venture into the
aviation services market.
Educational MarketDemographics Psychographics
Age: 18 - 25
Sex: Male
Marital Status: Single
Experiencers:
Experiencers are motivated by self-expression. Asyoung, enthusiastic, and impulsive consumers,
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Income: $20K to $30K
Education: HS, some College
Occupation: Student
Experiencers quickly become enthusiastic about newpossibilities but are equally quick to cool. They seekvariety and excitement, savoring the new, the offbeat,and the risky. Their energy finds an outlet in exercise,sports, outdoor recreation, and social activities.
Air Charter Market
Demographics Psychographics
Age: 30 - 55
Sex: Male
Marital Status: Married
Income: $200K+
Education: College Graduate
Occupation: Administrative
Innovators:
Innovators are successful, sophisticated, take-chargepeople with high self-esteem. Because they have suchabundant resources, they exhibit all three primarymotivations in varying degrees. They are changeleaders and are the most receptive to new ideas andtechnologies. Innovators are very active consumers,
and their purchases reflect cultivated tastes forupscale, niche products and services.
Aviation Services Market
Demographics Psychographics
Age: 25-55
Sex: Male
Marital Status: N/A
Income: $40K to $80K
Education: HS, some College
Occupation: Professional, Pilot
Experiencers:
Experiencers are motivated by self-expression. Asyoung, enthusiastic, and impulsive consumers,Experiencers quickly become enthusiastic about new
possibilities but are equally quick to cool. They seekvariety and excitement, savoring the new, the offbeat,and the risky. Their energy finds an outlet in exercise,sports, outdoor recreation, and social activities.
When analyzing the demographic statistics for the educational market and
comparing with Jackson County totals the estimated target market totals 58,000 with a
derived number of 1500 using the methods described in the Trading Area Analysis
section. Similarly, the air charter ETM = 52,000 and dETM = 115 and aviation services
ETM = 78,000 and dETM = 13,000. When looking at these market segments, the success
my fall into question because of relatively small numbers; however, two other factors
which will play vital roles in AmoLines success are the inherent expensive nature of the
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industry as well as the 80/20 Rule which suggests eighty per cent of profits come from
only 20% of the clientele. With the derived target market we are just honing in on the
specific twenty per cent to focus business promotions toward.
D. Analysis of the Potential Location
Location, location, location. Often referenced as the key to success, AmoLines
Air Service is no different. With several private airstrips, two small airports and one
controlled airport with commercial flights, locating our business at Rogue Valley
International Airport will be vital to our success because of both the commercial air
traffic and general aviation the hub attracts.
Specifically, AmoLines will be strategically placed on the east side of the main
runway, 32-14. The west side, being fully developed and without room to expand, is
quickly becoming outdated. The future of the airport is to the east side, land is cheap and
easy to come by with grand easements given by non-aviation based businesses. The
parcel itself is an expansive 88.9 acres located at 4700 Industry Drive, a spur from the
arterial Vilas Road which carries nearly thirteen thousand cars everyday (City of
Medford). Currently owned by Airport One, LLC this vacant lot is valued at $180,000
(Jackson County). This not only allows us to build exactly what AmoLines will require;
but, because of the property limitations on the west side, the east side of the airport will
soon be booming.
We can purchase this lot now inexpensively and reap the rewards as the value
undoubtedly increases, possibly in upwards of $800,000. The site will be both an
investment in the business because of location as well as for the business because of the
strategic position for the future of the airport.
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IV. Planned Operation of the Proposed Business
A. Proposed Organization
AmoLines Air Service will be the function of two Oregon Limited Liability
Corporations: Olson Property Management LLC and Amidon Aviation LLC.
Olson Property Management will be a joint venture with my uncle Vic Olson,
who will have the controlling 51% share. The role of OPM LLC we will be the
development of the parcel aforementioned. Vic, with his background in property
management and General Contractor License, will be responsible for negotiating the
purchase, constructing the buildings, paying real estate insurance and property taxes.
Amidon Aviation will own the business itself, including, but not limited to, the
company rights, furnishings, equipment, signage, and inventory. Similar to OPM this will
be a joint venture; however, I, James Amidon, will have the controlling 51% share; I am
looking to offer 49% in exchange for capital. Amidon Aviation will be responsible for
leasing and paying rent to Olson Property Management LLC in addition to maintenance
and leasehold improvements. I, James, will secure the capital investment needed to
commence business operations.
Benefits of forming the described dual corporations (Lewellyn):
Tax advantages no company tax filings, avoids double taxation. Limited liability partners free from personal liabilities, separation between
property and business liability.
Stock options either LLC can sell stock to generate income. Operations flexibility less regulated than standard corporations, treated like a
partnership.
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AmoLines Air Service Organizational Chart
At the peak of the organizational pyramid is the triumvirate of the two owners and
Aviation Manager. The position of Aviation Manager, a GM like position with
specialization in the aviation industry, will be salaried at $156,000 DOE and will be
expected to work with the owners to effectively communicate the ownerships visions.
Heading the Education division is a Chief Certified Flight Instructor (CFI) who will be
responsible for hiring, training, and working alongside both the classroom and in-flight
CFIs to ensure a complete educational experience. To lead the core of our business, the
Aviation Services division we will employ an Administration Supervisor who will be
responsible for hiring all positions in their division. In addition to aviation services, this
division will be responsible for payroll, ordering, scheduling, and building maintenance.
Lastly, running the Air Charter division of AmoLines will be the Charter Director whose
individual duties include, but are not limited to, hiring, training, and securing clientele for
our air charter market. Company wide marketing will be assigned to the Aviation
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Manager and the owners. For more information on individual salaries and labor costs see
Appendix: Labor Costs.
B. Proposed Services
AmoLines is poised to be successful because of our strategic mix of services currently
unavailable in the Rogue Valley alongside a number of services which are easily
accessible. We have a wide range of services with accompanying products, broken down
by company division:
Education
Ground Schoolo
Fixed-Wingo Rotorcraft (helicopters)
Private Piloto Single-engineo Multi-engineo Lando Seao VFRo IFR
Commercial Pilot (All Classes)o Pilot-for-hireo
Commercial Passenger Pilot
Air Charter
Piloted Chartero Business Chartero Single/ Family Chartero Group Charter
Airplane Rentalo Day Rentalo Trip Rental
Aircraft Storageo Hangaringo Tie-down
Aviation Services
Maintenanceo Annualso Airframe/ Powerplant Repairo Avionics Installation
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o General maintenance Fuel Service
o 100LLo Jet-Ao aviation engine oil
With such a wide array of products and services, it is essential to AmoLines
success to have honest, high-quality suppliers. For our fuel services, we have chosen
Chevron because of their superiority in the petro-energy industry; AmoLines will be the
only FBO on the west coast to offer this brand. For our education and much of our
aviation services we will be buying from Aircraft Spruce. This is a well known company
with a commitment to quality and product offerings from avionics and aircraft
mechanisms to pilot supplies for all aircraft, manufactured or homebuilt. Because of the
nature of the business, our inventory policies will be basic as most of our products will be
ordered from our suppliers at the point of sale. Less costly items, such as educational
materials, may be held in some stock which will increase in accordance with promotional
activities. For more info, see Appendix: Suppliers.
C. Proposed Marketing Strategies
When establishing pricing policies for AmoLines, we will closely consider the
pricing of our direct competition. Our general product mark-up will be around 30% plus
labor for installation; this is on par with our local competitors.
Sample Prices
Product AmoLines Price Top Competitors Price
Lotus Amphibious Floats $28590.00 $26480.00Garmin Avionics Panel $7835.00 $8120.00
Tempest Carbuerator $1376.00 $1429.00
Bendix Magneto $787.00 $756.00
VFR Sectional Chart $9.50 $11.00
100LL Fuel (per gallon) $3.69 $3.83
Jet-A Fuel (per gallon) $3.97 $4.09
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(Medford Air Service, Million Air)
Market availability is subject to change as are our corresponding prices. Most
products ought to stay relatively stable with small inflation-based increases in price;
however, fuels are subject to fluctuation depending upon oil prices, we will compensate
accordingly.
AmoLines promotional program will mainly focus on our Education and
Aviation Services market segments because they are so closely aligned. For our Air
Charter division, most promotional activities will be personal meetings with local
business partners. We plan to implement a unique program of nonpersonal promotion
alongside public relations events to gain renown.
First, we plan to run 15 seconds advertisements on the Radio Medford network of
stations: Lite 102, My Mix 93, KBOY Classic Rock, Hank FM Country. A 15 second clip
with 600 plays per month will run around $480 (Radio Medford). AmoLines will consult
with local web designers to produce a small airport directory, FBO search app for a
Blackberry or iPhone which will increase sales among airmen for a small price of around
$1000 (iPhone). We have elected to also paint a billboard atop our main hangar showing
our services for pilots on the final approach. Lastly, AmoLines will employ the masses of
social media with a fan page and similar company profile on Facebook and LinkedIn,
respectively.
Throughout the year we will reach out to all of our customers through a number
of events beginning with a grand opening open house to present our business to the
community. Over the weekend leading to Independence Day, we will put on an
acrobatics air show, the first time in the Rogue Valley in more than ten years. Our most
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emotional exhibit will be our Veterans Day Military Showcase in honor of those who
have served their country at home and abroad. A complete list of events is below:
First Year Promotional Program
Occasion EventApril 1 Open, press release
April 30 Grand Opening, Open House
Memorial Day weekend Airport Awareness Day, Kids Day
July 4th
weekend Acrobatics Airshow
Labor Day weekend Country Fly-in
Veterans Day weekend Military Showcase, USAF, Air National Guard
New Year (January) Flight School (discounted)
St. Patricks Day Spring Fling
With the number of competitors we have, it will be quintessential through our
promotional activities we show what we offer that our competition cannot: Pilot
education; we also need to focus on the community and earn their respect and trust
through our personal promotional activities.
V. Planned Financing
A. Projected Income and Expenses
Projected sales of $5.4 million in the first year show the modest optimism for the
venture. With a conservative growth of 7% annually, and a stable cost of sales around
35%, over three years Amidon Aviation LLC will have netted more than $1.6 million.
See the following Projected Income tables and Balance Sheet (Industry):
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A
moLines(AmidonAviationLLC)ProjectedIncomeStatementforFirstYear
M
onth
04/2011
05/2011
06/2011
07/2011
08/2011
09/2011
10/2011
11/2011
12/2011
01/20
12
02/2012
03/2012
Sales
378260
446010
465320
508490
494950
485370
463860
445690
448510
419
890
409670
424580
C
ostofSales
156450
148690
162440
182230
169960
162890
165340
153020
147230
138
980
139410
147620
G
rossMargin
221810
297320
302880
326260
324990
322480
298520
292670
301280
280
910
270260
276960
Salary/Wages
74664
74664
74664
74664
74664
74664
74664
74664
74664
74
664
74664
74664
B
enefits/Pensions
10370
10370
10370
10370
10370
10370
10370
10370
10370
10
370
10370
10370
Lease
40000
40000
40000
40000
40000
40000
40000
40000
40000
40
000
40000
40000
A
dvertising
1480
480
480
4480
240
240
480
240
Equip.Depreciation
25000
25000
25000
25000
25000
25000
25000
25000
25000
25
000
25000
25000
A
mortization
37513
37513
37513
37513
37513
37513
37513
37513
37513
37
513
37513
37513
PayrollTax
29036
29036
29036
29036
29036
29036
29036
29036
29036
29
036
29036
29036
O
therSG&A
41000
41000
41000
41000
41000
41000
41000
41000
41000
41
000
41000
41000
O
peratingExpenses
259063
258063
258063
262063
257583
257583
257823
257823
258063
257
583
257583
257823
O
peratingIncome
-37253
39257
44817
64197
67407
64897
40697
34847
43217
23
327
12677
19137
O
wnerDraws
10000
10000
10000
10000
10000
10000
20000
20000
20000
20
000
20000
20000
N
etProfit
-47253
29257
34817
54197
57407
54897
20697
14847
23217
3
327
-7323
-863
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AmoLines (Amidon Aviation LLC) Projected Income Statement for Three Years
Fiscal Year Q2 2011 - Q1 2012 Q2 2012 - Q1 2013 Q2 2013 - Q1 2014
Sales 5390600 5772400 6135700
Cost of Sales 1874260 2010980 2289610
Gross Margin 3516340 3761420 3846090
Salary/ Wages 895968 895968 895968
Benefits/ Pensions 124440 124440 124440
Lease 480000 480000 480000
Advertising 8120 6880 6880
Equip. Depreciation 300000 300000 300000
Amortization 450156 450146 450156
Payroll Tax 348432 348432 348432
Other SG&A 492000 540000 594000
Operating Expenses 3099116 3145866 3199876
Operating Income 417224 615554 646214
Owner Draws 180000 240000 240000
Net Profit 237224 375554 406214
AmoLines (Amidon Aviation LLC) Projected Balance Sheet December 31, 2011
Assets Liabilites & Equity
Current Assets: Current Liabilities:Cash 4569 Accounts Payable 28560
Receivables 45870 Accrued Payroll Taxes 261324
Inventory 37650 Long Term Liabilities:
Fixed Assets: Loan Payable 1913163
Equipment 3465900 Owners Equity:
Depreciation 225000 Owners Draw 120000
Furnishings 245400 Business Net Worth 1585825
Depreciation 27600
Other Assets:
Deposits 242083
Total Assets: 3788872 Total Liabilities & Equity: 3788872
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B. Proposed Plan to Meet Capital Needs
AmoLines is a high capital business, and with high risk comes great reward. Start-
up capital required will be $4 million, which I plan to raise through two means: $2
million venture capital investment for a 49% share; $2 million business loan amortized
over five years. This venture capitalist earn back investment over eight years using
progressive drawing techniques; in addition, they will have a 49% share in Amidon
Aviation, a business grossing in upwards of $6 million in three years. The monthly
amortization of the loan has been figured into both projected income statements as well
as the end of the year balance sheet.
VI. Conclusion
AmoLines will re-invent the idea of a fixed base operator in Medford, Oregon.
We have a sound target market for each division and we will constantly be increasing our
customer base in all phases because of our pilot education and certification programs.
Employing unique media for our advertising we will reach a broader market, increasing
our market segment further, therefore increasing our revenue streams.
As an experienced aviator and well versed businessman, I request a $2 million
business loan to be repaid over five years at a fair 4.75 A.P.R. Additionally, I ask for a $2
million investment in exchange for a 49% share in my company which has incredible
growth potential alongside high value assets with low depreciations.
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VII. Bibliography
Aircraft Spruce. 2009. 15 April 2009. .
Average Salary Information. Salary.com. Kenexa. 31 Jan. 2011..
Aviationwise. 2009. 22 April 2009. .
Aviation Supplies & Academics. 2009. 15 April 2009. .
Barker, Emily. The Bulletproof Business Plan. Mansueto Ventures LLC. October2001. 1 April 2009. .
Chevron Global Aviation. 2008. 15 April 2009..
City of Medford Oregon. 2009. 30 April 2009. .
The Entrepreneurship Test. Liraz Publishing. 2009. 15 April 2009..
Fact Sheet: Jackson County, Oregon. U.S. Census Bureau. 2007. 22 April 2009..
Farmers Commercial Real Estate Insurance. Farmers Insurance. 31 Jan. 2011..
Google Maps. TeleAtlas. 2009. 30 April 2009. .
Gumpert, David E. The Basics of Business Plans: Sell, Sell, Sell. Mansueto VenturesLLC. October 2000. 1 April 2009..
Hosting Details. Project A. 15 May 2009..
Industry Financial Profile (Fixed Base Operator). Camp Hill, PA: BizMiner, Nov. 2010.
iPhone Developer Program. 15 May 2009..
Jackson County Front Counter Application. Jackson County Oregon. 30 April 2009..
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Lewellyn, Bart. "Small Business." Personal interview. 21 May 2010.
LLC Advantages - LLC Disadvantages - Why Form an LLC - EntrepreneurialResources - Tips for Entrepreneurs - Gaebler Ventures - Chicago,
Illinois.Entrepreneur Resources. Gaebler Venture Capital. 31 Jan. 2011..
Medford Air Service. 2006. 21 April 2009. .
Methods For Determining Price. American Express: Small Business. 2009. 12 May2009. .
Million Air. 27 Jan. 2011. .
Pricing Strategies. Marketing Teacher. 2009. 12 May 2009..
Radio Medford. 31 Jan. 2011. .
Seven Low-Cost Marketing Ideas. AllBusiness. 13 May 2009..
Small Business Advertising Basics. AllBusiness. 13 May 2009..
Southern Oregon Regional Economic Development, Inc. 2009. 22 April 2009..
The VALS Segments. SRI Consulting Business Intelligence. 2008. 17 April 2009..
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VIII. Appendix
Market Segments:
Education Market
Demographic Population Percentage
Total Population of Jackson County 207,745 100%
Age: 18-25 18,533 9%
Sex: Male 100,988 49%
Marital Status: Single 39,370 48%
Income: $20K to $80K 49,586 59%
Education: HS, some College 81,209 57%
Estimated Target Market 57,937 28%
Derived Target Market 1,480 0.712%(SOREDI)
While the Estimated Target Market is 28% of the population, the expected
customer base (derived ETM) is set as 0.7 % (1480) after compilation of all
demographics accounted.
Air Charter Market
Demographic Population Percentage
Total Population of Jackson County 207,745 100%
Age: 30-55 71,072 34%
Sex: Male 100,988 49%
Marital Status: Married 42,962 52%
Income: $200K+ 1,502 2%
Education: College Graduate 44,058 31%
Estimated Target Market 52,116 25%
Derived Target Market 112 0.054%
(SOREDI)
The Estimated Target Market is 25% of the regional population, however the
derived ETM is 112, a small number; the product is very expensive (as income suggests)
which makes up for the small customer base.
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Aviation Services Market
Demographic Population Percentage
Total Population of Jackson County 207,745 100%
Age: 25-55 84,201 41%
Sex: Male 100,988 49%Income: $40K to $200K 44,749 53%
Education: HS, some College 81,209 57%
Estimated Target Market 77,788 37%
Derived Target Market 12,608 6.069%
(SOREDI)
The Estimated Target Market is 37% of the Rogue Valley; when all factors are
combined, the derived ETM is 12,608 leaving quite a hefty market from which profits
can be gained.
Labor Costs:
Monthly Labor Costs
Position BaseSalary
HourlyWage
AverageHours
AverageCompensation
Aviation Manager $13,000 N/A 160 hrs. $13,000
Chief CFI $7,500 N/A 120 hrs. $7,500
Classroom CFI $5,900 $20.00 60 hrs. $7,100
In-Flight CFI $5,500 $12.50 60 hrs. $6,250Administrative Supervisor $3,200 $11.25 160 hrs. $5,000
Administrative Professional x2 N/A $15.00 120 hrs. $1,800
Airframe & Powerplant Mechanic $2,750 $8.75 160 hrs. $4,150
Avionics Technician $2,650 $6.25 160 hrs. $3,650
Fuel Technician x2 N/A $12.50 120 hrs. $1,500
Aircraft Maintenance x2 N/A $12.50 160 hrs. $2,000
Air Charter Director $3,000 $20.00 160 hrs. $6,200
Crew Chief (Pilot) x2 $5,650 $40.00 60 hrs. $8,050
Co-Pilot x2 $5,150 $25.00 60 hrs. $6,650
Flight Attendant x2 $3,000 $20.00 60 hrs. $4,200Chauffer $1,250 $30.00 40 hrs. $2,450
$103,700Monthly Labor CostsAnnual Labor Costs $1,244,400
(Average Salary)
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Salaries and hourly compensation are subject to change as business progresses to allow
for more consistent paychecks.
Suppliers:
Company Address Phone Website
ChevronCorp.
1500 Louisiana StHouston, TX
(832)854-5927
http://www.chevronglobalaviation.com/
ProductmmOfferings:
Chevron provides its customers with the highest quality aviation fuelavailable. AmoLines will be the only FBO on the west coast to offer bothChevron Jet-A and 100LL fuels.
(Chevron)
Company Address Phone Website
Aircraft Spruce
& Specialty Co.
225 Airport Circle
Corona, CA
(951)
372-9555 http://www.aircraftspruce.com/Productmm
Offerings:Aircraft Spruce wholesales any part required for nearly anymaintenance or installation project for manufactured aircraft; also,they supply a number of products for home- and kit-built airplanes.In addition Aircraft Spruce offers pilot supplies of all types for ourEducation market. With Aircraft Spruce, AmoLines will offer thebest product line alongside first-rate installation to our customers.
(Aircraft Spruce)