February 19, 2009 9:32 AM EST
I have been receiving great advice and using it to restructure my business plan. I have also been getting some shady responses like the one above. I know it sounds like I am all over the place but really it is one business with services centered around that business that feed off each other rather than using other businesses. In my business plan I break down each service and show everything from costs of equipment still needed, overhead for that service (not including office and utilities), charges for the service, profit margin and how directly related it is to the main service which is designing homes. For example blueprint printing is broken down to costs to print per linear foot vs charge per linear foot matching the lowest area price. Then the relation to the design business would be that I will be changing all plan formats to the sizes requiring these over size printers to print. Speaking with my builders I found that all of them have these plans printed for each home they build anyway and said if I offered the service they would definately use me to save some time. They are spending $300-$400 per home to print the number of plans they need and they tell me they have to wait sometimes a week or more for the area printers to have them ready because they are so busy even in this slow housing market.
I believe it sounds like I`m all over the place because I am trying to tell of so much in such a little space and I don`t want to give up to much info. Honestly Mark, the suggestions you gave above is Greek to me. My knowledge is building and designing homes, I am trying to better educate myself in business as I go but have a long way to go when it comes to the areas of investment and corporate finance. I have tread very lightly until now and understand that I can`t grow anymore unless I explore new territories of business.
I have someone I know that lost a lot of money in the stock market investments he had that is thinking of getting out of the stock game. He lost 6 times the amount that I am needing and isn`t seeing what is left going anywhere for a long time. I am restructuring the offer by using the investment as a debt that I would pay back plus interest and he would also be given 10% ownership of the company and an equal share of the end of year profit to go toward the loan. Now the first half of the end of year profit would stay in the company each year as working capital. The second half would be taken out and divided equally between he and I. Now because I am receiving a salary to live on I plan on using my share to put towards the debt of the investors investment. After the investment is repaid with interest the investment partner would continue to receive an equal share every year unless he decided to cash out and sell his 10% ownership back to the company. I have already been communicating with my accountant for his advice as I go and he said he would be sure that I don`t do anything that would get me in trouble.
What do you guys think?
Jamie Compton Design Inc.