Department of Mechanical Engineering

Faculty of Engineering

University Of Port Harcourt

A

Business Plan

Quick and Dirty Auto Repair

(QDAR)

Presented by

Osho Opeyemi U2006/3025324

Course Code GES 400

Course Title Fundamentals of Entrepreneurship project

March 2011.

Dedication

I dedicate this plan to my Family, Friends, Colleagues and Loved ones.

Approval

............................. ……/……/……….

Project Supervisor

(Mr. Tonye Jack) Date

Acknowledgement

I wish to thank a number of people who have made this business plan a success with their suggestions and constructive criticisms. In particular, appreciating the support from management, especially the Field Service Manager, Mr. Sunday Adejugbe of Mantrac Nigeria Ltd, Mr. Paul Lecoq and Gil Manaigre of Joe’s Machine Shop, Winnipeg, Canada for E- support and Advice on Setting up a machine shop and services worth rendering.

Abstract

QDAR is due to being formed as a cooperative business owned and engineered by Osho Opeyemi as the Director and Technician. This plan is written as a work through for starting and managing this business and also serves as the basis for marketing plan. The objectives of QDAR are to generate profit to finance future growth and resources needed to achieve other objectives of the company and its owner. QDAR offers auto spare parts, troubleshooting, repair, and maintenance of automobiles.

TABLE OF CONTENT

Introduction

Executive summary

Objectives of Company’s services

Mission

Key to Success

Literature Review

Products/Servies

Company Summary

Business location

Business structure/management

Products/services

Service description

Sales literature

Fulfillment

Company facility locations

Legal form of business

CHAPTER 1 : INTRODUCTION

EXECUTIVE SUMMARY

Quick and Dirty Auto Repair (QDAR) is a start-up organization that offers a complete domestic and foreign care repair service as well as a full-featured retail parts store. QDAR will serve the Port Harcourt, OR market with three convenient locations. QDAR will grow into a business with outstanding sales by year three.

The Concept

The auto repair market has a lot of competition; however, almost all only offer service. QDAR will differentiate themselves by not only offering a hassle-free repair service, but a fully stocked parts store. Not only will this serve a wide range of customers for both service and parts, but the parts department will support the service department by allowing the service department to turnaround jobs far faster than the competition with generally all of the needed parts in stock and on location.

QDAR also differentiates them by having 10 bays at every location. This offers incredible value to customers who need their cars fixed right away. Waits for service and parts are ideas not entertained by QDAR. Lastly, QDAR offers unlimited shuttle service for repair customers making the entire service experience as painless and convenient as possible.

QDAR will attract and maintain a loyal customer base through their customer-oriented focus on business. All employees are trained and held responsible for providing superior service, developing a long lasting trust bond with customers. This is very important, especially in the auto repair industry where trust and honesty are not the image of repair facilities.

1.1 Mission

Quick and Dirty Auto Repair aims to offer high-quality auto repair services and a full range of auto parts. QDAR focuses on personalized service to its customers by offering convenience and rapid service. Additionally, QDAR is technologically savvy with computerized monitoring of all parts inventory, to ensure that parts are always in stock, while keeping a balanced level of inventory to maximize inventory turnover. Finally, QDAR has strong vendor relationships with the most service conscious vendors who are capable of shipping major parts rapidly (on an overnight timeline in most cases).

1.2 Keys to Success

QDAR's keys to success will include:

1. Expedient and convenient auto repair services. 2. Growing and maintaining a referral network of local towing service companies.

3. A wide range of auto parts inventory that is (nearly) never out of stock.

4. Rapid order and delivery of major auto parts items.

CHAPTER TWO

Literature Review

2.1 SITE SELECTION

2.1.1 SELECTING THE SITE

Since the site location has a large influence on the success of the garage, careful consideration must be given to the selection of site location. Moreover, since the publicity effect is large, site selection is something which contributes to the overall expansion of the company.

2.1.2 ITEMS FOR CONSIDERATION IN SELECTING THE SITE

It should face a main road (or be close to a main road)

It should be on a level ground.

It should be a location where there are no traffic delays, etc.

It should be possible to secure an adequate surface area.

It should be a location with room for expansion.

It should be a location where public facilities can be used.

It should be a location without legal restrictions.

The soil base should be suitably firm.

2.1.3 SITE SELECTION

The site should of course, be large enough for future expansion. The future development of the surrounding area itself should also be considered, along with the following points.

Is the site easily accessible to heavy-duty vehicles by way of existing roads?

Is it easy to find, even by people who are unfamiliar with the neighborhood?

Are there any problems with the electricity or water supply or sewer facilities?

Will there be any problem of noise, exhaust or oil disposal regulations?

Are there hospitals, schools, housing areas, etc., nearby which would be affected by loud noises? Are there plans for such construction in the near future? Of course, extreme care must be taken in constructing the garage not to cause any form of pollution.

2.2 STANDARD AREAS FOR SHOPS, ROOMS, AND BAYS.

2.2.1 LIST OF VARIOUS SHOPS, OFFICES, AND ROOMS OF GARAGE.

(a) Office and warehouse

General manager’s office

Service manager’s office

Service office

Customer waiting room

Reception room

Watchman’s room

Sales manager’s office

Sales office

Showroom

Parts manager’s office

Parts office

Parts warehouse

(b) Workshops and related areas

General service bay(s)

Inspection bay(s)

Lubrication bay(s)

Engine repair shop

Unit repair shop

Electric service shop

Tool room

Injection pump shop

Machine shop

Air compressor room

Generator room

Service parking area

Stock yard

Grounds

2.2.2 STANDARD AREAS

This section explains the standard areas for the more important parts of the workshop.

(a) General service bay

The general service bay fulfills the garage’s principle role, and it is usual to have several. The service bays, related passageways, tool benches, etc. must be given careful consideration for space layout.

(b) Inspection bay

This is where incoming vehicles checks, after servicing checks, etc. are conducted. There are two types, differing according to inspection methods. In one, the vehicle condition is checked using various types of mechanical equipment. In the other, mainly visual method are used. For the former various types of measuring equipment are installed, so the dimensions should be larger than the general service bay. In the latter, oil leaks, tigness of parts, and wear and loss of various parts are checked for by means of a pit, so the area is the same as the general service bay. Since this type is essentially a general service bay with a pit, it should be included among the general service bays. One-fifth of the general service bay should be of this type. (However, there should be at least one.) They can be used for both general service and lubrication.

(c) Lubrication bay

This is the place where grease-jobs, engine and gear oil exchanges, etc. are conducted. In this connection storage space for various oils and greases is necessary near the vehicles. Considering the nature of the operations, installation of a pit or large -size lift is desirable. The bay size is the same as the general bay. However, it is necessary to install storage areas for oils and greases very near. (If the lubrication bays are not provided, the general bay or inspection bay may be used for these operations.)

(d) Engine repair shop

This is where engine overhauls and corresponding repairs are conducted. An engine repair shop is not necessarily in all garages. That is, since an engine overhaul requires skilled technicians, it cannot be done well at branch garages.

(e) Unit repair shop

This is where overhaul and repair of various single units (excepting the engine) such as the transmission, transfer, differential, steering gear box, brake valve, etc. are conducted.

(f) Electric Service Shop

This is where repair and overhaul of electrical parts and winding, battery recharging are conducted. The disposition of sulphurous acid gas produced during recharging is a point which needs careful consideration.

Possible measures for this are complete air ventilation and separation of the battery job during recharging.

(g) Tool room

This is where common tools, large-size common tools, Nissan Diesel special tools, measuring devices, etc. are stored. One person should be in charge of the tool room. He should keep a record of all tools issued to the mechanics and should order new tools to replace those that wear out.

(h) Injection pump shop

This is where fuel system parts, such as the injection pump and nozzle are repaired and calibrated. Since the parts are precision parts, they must be protected from dust, and preventive measures, including air conditioning are necessary.

(i) Machine Shop

This is where necessary machine operations for vehicle repair are conducted. Normally an agreement is made with a suitable outside machine shop, and servicing is done by them. However, it is desirable to perform simple operations at the distributor/dealer’s garage.

2.3 WORKSHOP PROCEDURES AND WORK CONTROL

2.3.1 Control systems

Control systems are needed for the workshop in order to offer effective control over work loading, work distribution and work flow. This is to ensure a well utilized workforce and satisfied customers.

2.3.2 Workshop Loading Chart

Such a chart allows you to forward, plan and indicates the daily situation in the workshop whilst simultaneously providing an analysis of productive and non-productive time. Gaps in the loading chart indicate how much more work can be taken on for a particular day.

2.3.3 Appointment Procedures

Customer calls to make an appointment

Customer gives names, vehicle details and phone contact number.

Customer accepts appointment or chooses another option offered by the service advisor.

Service advisor introduces department and gives his/her name.

Service advisor asks customer’s and vehicle’s details; name, year, model, registration number.

Service advisor determines customer’s main request, either general repairs or periodic maintenance.

Service advisor checks appointments availability and suggests the appointment day, time and price (if possible).

2.3.4 Management of appointment system

There are four important factors that should be tracked and managed in the appointment systems, these are:

Appointment Rate: The appointment rate is the percentage of customers who made an appointment for customer-paid. It shows customers awareness and support for your appointment system. Appointment system should not exceed 80%.

“No Show” Rate: The “No Show” rate indicates the number customers who did not arrive at the dealership at the expected time. A follow-up and monitoring system must be in place to reduce the “no show” occurrence.

Carry-over-rate: The carry-over-rate is the number of vehicles that were not finished on time and have to be “carried over” to the following day’s workload. Carry-overs can be caused by; parts availability problem, difficult-to-diagnosis faults, and additional repairs or inefficient job progress control.

Work-mix(maintenance to repair ratio): Depending on the skill level of available technicians, the work-mix of the jobs accepted in the appointment system, must be monitored and adjusted, for example maintenance 65%, repair 35%. The total available appointment hours

should not exceed 80% of available manpower time, to allow for walk- in customers and emergency requests.

2.3.5 The Reception Process

The reception process comprises the following;

Preparation

Prepare the repair order, along with the seat cover, and paper floor mat, to protect the customer’s car.

Receiving the customer

Greet the customer on arrival, introduce yourself, and give your name. Ask the customer if he has an appointment. If the customer has already made an appointment, repeat the main request. For example: “Mrs. Ricardo, you made an appointment for 30,000 kilometers maintenance, is that correct?” If the customer has no appointment, check manpower availability and confirm when you can start the job. Check the previous service history and provide additional advice if necessary, check and confirm the customer’s: name spelling, current address and telephone numbers (home, business).

Inputting the customer’s e-mail address will also be useful option for post-service follow-up.

Determining the customer’s needs: By careful questioning and listening to determine the customer’s needs.

Diagnosis or Test Drive: If the customer describes a condition that requires diagnosis or a test drive, the foreman or lead technician should be requested to road test and experience the condition. If it is difficult to identify or rectify the fault, use a pre-diagnostic questioning sheet to get further information that will assist the Technician to fix- it-right the first time. If the job is a repeat repair (comeback) the foreman and workshop Manager should be informed in advance.

Vehicle walk-around-check: “See with your own eyes”. Go to the vehicle and carryout a walk-around-check to discuss the customer’s needs and identify any other service or repair needs that are necessary. Place a seat cover, floor mat in the vehicle, in the presence of the customer. Write the odometer reading on the repair order and confirm the maintenance that is

required. Walk around the car and note on the repair order, any body and paint damage, or missing items. Explain any additional maintenance items that require attention, for example: uneven tire wear, wiper blade inserts, etc. Suggest counter measures such as, wheel alignment, or tire rotation or replacement.

The walk-around check provides the service Advisor with the opportunity to identify and discuss items that require attention. This check is useful, especially for items requiring attention, which are unknown to the customer. The Service Advisor can also point out body or paint damage that exists on the vehicle before it enters the service area.

2.3.6 Repair Order

The repair order will have the following essential information:

CUSTOMER

Customer’s name, address and telephone contact numbers.

Customer’s preferred follow-up method (telephone, e-mail)

Customer’s signature

VEHICLE

Vehicle model code

Frame number identification

Registration details

Odometer reading

WORK DETAILS

Customer’s words or main request

Service advisor or foreman’s request

Technician comments on work done

Estimate cost of repairs, lubricants, and parts.

A walk-around check body diagram

Technician’s productive time on job

Method of payment and customer’s signature

Promised delivery time

2.4 SELECTION OF STAFF

It is very important that correct selection procedure is followed to avoid incompetent staff since the employment protection act gives employees considerable protection against wrong dismissal. In order to eliminate guesswork when selecting applicants for new appointment, the following points should be considered.

Physique: This deals with a person’s health, appearance and other physical attributes. The candidate must have good health generally and special fitness for the job. Attainment –These are the special qualifications and experience needed for the job.

Special aptitudes: candidates must have the skill required for the job.

Interest: The hobbies or lively interest in any particular subject related or not with the job seek.

Disposition: An indicator of whether a person will work well as part of a team is honest and has leadership qualities.

Circumstances: factors like mobility, age and experience.

2.5 SAFETY PRECAUTION

Accidents in the workshop claim many victims and approximately 70% of these accidents are caused by negligence/carelessness on the part of the workman, consequently the need for care cannot be overstressed, the points set out here are intended to warn vehicle mechanics of some of the dangers he is likely to meet in the motor vehicle workshop. A tidy workshop can help to reduce the number of accidents. Tools and components should not be left where someone may fall over them. They must never be allowed to obstruct gang ways or passages; neither should they be laid carelessly upon a bench. A tidy bench reflects a tidy methodical, business-like mind, which is the basis of accident prevention. Oil or grease on the workshop floor is dangerous and should be covered with sand or sawdust to prevent accident.

2.6 STAFF OF A VEHICLE REPAIR STATION

The staff required to operate a motor vehicle services station includes the:

1. Managing Director

2. Service Manager

3. Parts department manager

4. Sales manager

5. Account manager

6. Human resource manager

7. fore court manager

8. Reception engineer

9. Workshop manager

10. Foreman for the workshop

11. Charge hand

12. Mechanics (skilled and semi skilled)

13. Apprentices

14. Office staff

15. Cleaners Laborers

16. Each staff is required to have certain knowledge and skill appropriate to his/her position

Apprentices: The apprentice selection is considered most important. Here, a considerable amount of time and money is spent as an investment with the hope that a young man will be become a skilled mechanic and then a technician engineer. Before one commences any apprenticeship, he must have a reasonable intelligence in order that he can absorb the wealth of detailed knowledge dispensed by any skilled personnel in the motor vehicle

trade. Before any person is signed on for apprenticeship, he must be tested by a training officer to assess the academic aspect of his ability and other aspect which will affect his apprenticeship must be considered. The following are the requirements for apprentice selection.

1. An inquiring mind

2. Desire to become a skilled mechanic

3. Course of study

4. Physical ability

5. Stable mentality

The length of training for an apprentice is usually between 3 and 4 years.

This must be explained to the young apprentice and if possible, he must be shown how he will progress in apprenticeship.

Skilled Mechanics: These are people who have had apprenticeship training with some theoretical qualifications who can execute all repair works on the motor vehicle without supervision. People of this type require some supervision on repair works. They normally have little or no academic qualification. They might achieve some practical skills by working with skilled mechanics. Some organization promotes laborers to semi – skilled workers within a workshop.

Foreman: In the motor vehicle repair business, a Foreman is one who has been appointed to supervise the work of mechanics in the workshop. He is appointed to this position because he has gone through apprenticeship training and has become a skilled mechanic.

Service Manager: He is the head of the service department and for that matter the workshop, and is directly responsible of the repair garage manager. He directly supervises the following subordinates.

1. Workshop controller

2. Reception engineer

3. Foreman

2.7 ORGANIZATIONAL CHART FOR A TYPICAL WORKSHOP

The organizational chart gives a pictorial representation of the organization. It shows the functional divisions of the repair business and the formal relationships between the different levels of authority and the chain of command. Organizational structures and for that matter charts needs to be modified to reflect the changes that occur in every business. An organizational chart is good because it entails a clear analysis of lines of authority, who is responsible for what, and who is accountable to whom. It is useful in settling disputes over authority, responsibility and accountability.

2.7.1 STAFFING

(DIAGRAM OF CHART)

2.8 ORGANIZATION OF A MOTOR VEHICLE SERVICES GARAGE

For a successful reorganization of a motor vehicle repair business, one would have to:

Identify the activities to be carried out.

Decide on the departments needed to carry out the activities and how departments relate to each other.

Create positions to manage department clearly set out the authority and responsibility of each position.

Determine the staff that will be needed and clearly lay down their responsibilities, where they fit into organizational structure and whom they are accountable.

Provide a system of communication within and between departments and also between the different levels of management.

2.9 MARKETING AND PROMOTING WORKSHOP SERVICES.

Marketing can be described as the process of discovering customer’s needs up to the point when the actual sales can be made. It involves the presentation of your products or services; promotion of the products or services to potential customers, distributing the product and looking after customers before, during and after sale has taken place.

Marketing seeks to increase profit by identifying the needs of the customer and exploiting all available opportunities with the available resources. It involves a number of factors

Including:

The co-ordination of activities of a dealership operations i.e. selling, delivering, pricing and presentations.

The assessment of sales potential and customer needs.

Motivating customers so that they want to purchase the dealership services and goods.

Ensuring the customer can obtain goods and services in the way that best suits them.

2.9.1 MARKET RESEARCH

To begin marketing, it is important to study the market, to do this; we need to find out about two sets of people.

1. The Customers :

We need to know who our customers are, where they are what they need. In order to direct our marketing efforts to the right people in the right places and offer them exactly what they want, it is necessary that we find out everything about our potential customer.

2. The Competitors :

We need to find out who our competitors are, where they are, the kind of services that they provide, how they operate, their strengths and weaknesses.

2.9.2 MARKETING MIX

One common way of looking at the market is to consider the Marketing Mix (the four, Ps’ of Marketing). These are:

I. The product:

The customer must be provided with the right product or services. Planning the product therefore involves the discovery of what the customers’ wants are and how these wants can be profitably met.

II. Pricing:

The customer is offered a quality product at a price acceptable to him.

III. Place:

The physical location of a dealership will have a critical effect on its success. The product should be provided in the right place or in a convenient manner for the customer.

IV. Promotion:

This is the process of increasing customer awareness and desire. It involves providing the product in a manner attractive to the customer.

2.10 SPARE PARTS DEPARTMENT

For any motor vehicle repair station to function efficiently, it is essential that it is supported by adequate stock of spare parts which are easily available for sale to the customer and for use in the repair shop. The success of the motor vehicle repair business is related to proper management of the spare parts and materials in stock. The spare parts section of a repair station may be a separate unit managed by the parts manager in the case of larger station or in the case of smaller stations its management may be part of the responsibilities of the service manager.

CHAPTER 3

3.0 COMPANY SUMMARY

The company will be owned fully with Mr. Osho Opeyemi. The company will be a limited liability company registered with Corporate Affairs Commission of Nigeria.

The economic growth of the last several years has resulted in increased disposable income. Many people have chosen to spend part of their increased income on their automobiles. As a result, the need for reliable and convenient auto services has substantially risen as well. QDAR will position itself to capitalize on the growing need of the middle and upper class market for quality auto service in the South- South area of Nigeria. The company will be privately owned by four co-owners, with most of the additional funding coming from a ten year SBA loan.

3.1 COMPANY OWNERSHIP

QDAR is incorporated in Rivers State. It is privately owned by Osho Opeyemi. To attract additional financing, the owners may consider taking QDAR public several years down the road.

3.2 START-UP SUMMARY

Each of the four co-owners will invest an equal amount. The remainder of the required financing will come from a ten year Small Business Administration (SBA) loan and a short-term loan. The following chart and tables show projected initial start-up costs for QDAR.

FIG 2

Start-up

Requirements

Start-up ExpensesLegal N3,000 Other N2,000 Total Start-up Expenses N5,000

Start-up AssetsCash Required N100,000 Start-up Inventory N50,000 Other Current Assets N50,000 Long-term Assets N350,000 Total Assets N550,000

Total Requirements N555,000

Start-up Funding

Start-up Expenses to Fund N5,000 Start-up Assets to Fund N550,000 Total Funding Required N555,000

Assets Non-cash Assets from Start-up N450,000 Cash Requirements from Start-up N100,000 Additional Cash Raised N0 Cash Balance on Starting Date N100,000 Total Assets N550,000

Liabilities and Capital

LiabilitiesCurrent Borrowing N55,000 Long-term Liabilities N250,000 Accounts Payable (Outstanding Bills) N0 Other Current Liabilities (interest-free)

N0

Total Liabilities N305,000

Capital

Planned InvestmentOpeyemi Osho N250,000 Additional Investment Requirement N0 Total Planned Investment N250,000

Loss at Start-up (Start-up Expenses) (N5,000)Total Capital N245,000

Total Capital and Liabilities N550,000

Total Funding N555,000

CHAPTER 4

4.0 PRODUCTS AND SERVICES

QDAR has the core competencies amongst its large crew to work on all makes and models of domestic and foreign vehicles. With ten service bays at each location, and all employees focused on superior customer service, quick turnaround is always the standard at QDAR. QDAR strives to be accurate and honest with customers in terms of quoting cost estimates and repair completion time estimates. QDAR employees focus on delivering what they promise. This focus on building strong customer relationships based on trust and integrity will be the catalyst in establishing a strong regular customer base.

QDAR utilizes the highest degree of technology in managing a full range of auto parts inventory. The goal is to never be out of a specific part, while maximizing inventory turnover. Strong vendor relationships have been established with the most reputable vendors in terms of shipping time of major parts

4.1 Service Description

F & R Auto provides a wide range of auto repair services. These include:

Scheduled maintenance. Wheel alignments, tires and rims.

Brake repair.

Comprehensive engine repair.

Transmission.

Each job or project will be on a reservation basis, although we will accept a small percentage of drive in repair work.

4.2 Technology

The technological revolution in computers has enhanced our abilities to diagnose and repair our clients vehicles. QDAR will remain on the cutting edge by instituting the use of computer diagnostic equipment in its shop. The company will continue to seek new ways to provide a better service through technology.

4.3 Future Services

The company does not have any plans to create further services at this time.

Market Analysis Summary

QDAR has a focus on meeting the demand of a regular local resident customer base, as well as towed vehicle drop-ins from local and freeway traffic traveling on nearby freeways. QDAR has established relationships with a few major local tow truck companies for referral business of stalled vehicles requiring a tow to an auto repair facility.

The company estimates that about 80% of revenues will come from the established local clientele and 20% from the local and freeway traffic tow-ins. The table below further estimates the total market potential of type of services rendered by QDAR in the Portland metropolitan area.

4.1 Market Segmentation

QDAR focuses on the middle and upper income markets. This market looks for high quality, rapid service with as much convenience as possible. Most individuals in this market segment are willing to pay an extra premium within the pricing of auto repair services to avoid the common inconveniences of having a vehicle tied up in a repair shop.

Local residents regular customer baseQDAR wants to establish a significantly large regular customer base. This will establish a healthy, consistent revenue base to ensure stability of the business.

Emergency towing local and freeway trafficEmergency towing of local and freeway traffic comprises approximately 20% of revenues. Convenience, regular referrals from tow truck companies, and high quality, rapid service are critical to capture this segment of the market.

Market Analysis

Year 1 Year 2 Year 3 Year 4 Year 5

Potential Customers Growth CAGR

Local Residents 15% 50,000 57,500 66,125 76,044 87,451 15.00%

Freeway Traffic 10% 20,000 22,000 24,200 26,620 29,282 10.00%

Other 0% 0 0 0 0 0 0.00%

Total 13.64% 70,000 79,500 90,325 102,664 116,733 13.64%

4.2 Target Market Segment Strategy

QDAR will focus on its target market, the middle and upper class market, and establish a reputable image from that target market's perspective, by offering convenience, expedient auto repair services, customer service excellence, and by working with local towing companies.

4.2.1 Market Needs

Between having a high level of commuting traffic, and an equally high level of tourism traffic on local highways, there is a constant significant demand for auto repair services and auto parts. Convenience is a must for most middle and upper class consumers and travelers.

4.3 Service Business Analysis

The market of auto repair services and parts sales is very fragmented. The majority of auto shops usually offer either repair services or parts inventory. The niche where QDAR positions itself represents auto centers that offer both auto services and parts at one convenient location. Middle and upper class customers to whom QDAR will cater its services are less price sensitive as they value the convenience of quick turnaround (on any model/make of car) and high quality of services.

4.3.1 Competition and Buying Patterns

QDAR faces over 400 auto repair and auto parts competitors in the local area. Only a quarter of these competitors offer both auto repair services and auto parts inventories. Among these, only a few are major national chains. The remainder are small privately-owned establishments. QDAR will compete well by focusing on convenience and offering a high level of customer service. Additionally, its honest reputation will be a major factor in repeat business and building a large base of regular, loyal customers.

Primary competitors are engaged principally in the retail sale of automotive parts, tires and accessories, automotive maintenance and service and the installation of parts. Larger competitors have adopted the "supercenter" store model, a freestanding, "one-stop" shopping automotive warehouse that features state-of-the-art service bays. These "supercenters" carry thousands of stock-keeping units and serve the automotive aftermarket needs of the "do-it-yourself," the "do-it-for-me" (automotive service), tire and "buy-for-resale" customer sectors.

Large competitors' stores typically carry the same basic product line, with variations based on the number and type of cars registered in the different markets. A full complement of inventory at a typical supercenter includes an average of approximately 25,000 items.

Automotive product lines usually include:

Tires. Batteries.

New and remanufactured parts for domestic and imported cars, including:

o Suspension parts.

o Ignition parts.

o Exhaust systems.

o Engines and engine parts.

o Oil and air filters, belts, hoses, and air conditioning parts.

o Lighting.

o Wiper blades.

o brake parts.

Chemicals, including oil, antifreeze, polishes, additives, cleansers and paints.

Mobile electronics, including sound systems, alarms, and remote vehicle starters.

Car accessories, including seat covers, floor mats, and exterior accessories.

Hand tools, including sockets, wrenches, ratchets, paint and body tools, jacks and lift equipment, automotive specialty tools and test gauges.

A selection of truck, van, and sport utility vehicle accessories.

Many competitors have adopted point-of-sale systems in their stores, which gathers sales and gross profit data by a stock-keeping unit from each store on a daily basis. This information is then used to help formulate pricing, marketing and merchandising strategies. Electronic parts catalogs are available in many competitor stores along electronic commercial invoicing systems that offer commercial parts delivery.

Additionally, a number of competitors have electronic work order systems available amongst their various service centers. This type of system creates a service history for each vehicle, provides customers with a comprehensive sales document, and enables the service center to maintain a service customer database.

Strategy and Implementation Summary

QDAR will succeed by offering its customers high-quality, rapid, and convenient auto repair service. Additionally, QDAR will succeed by ensuring a full range of auto parts inventory and rapid shipping capability of major auto parts.

5.1 Competitive Edge

QDAR's competitive edge is the heavy focus on customer convenience by offering unlimited shuttle service, rapid turnaround on auto repair jobs, and a referral network of a few local major tow truck companies.

5.2 Sales Strategy

QDAR will focus its sales strategy on effectively reaching the target customer segment of upper and middle class customers. For this purposes, the company will employ direct sales staff. At the same time, the company will further strengthen its relationships with the tow truck companies to capture auto repair needs of the local and highway traffic.

QDAR plans to deliver sales as shown in the table and charts below.

6.1 Personnel Plan

As the personnel plan shows, QDAR expects to make gradual investments in staffing as several new facilities are opened over the next ten years.

Personnel Plan

Year 1 Year 2 Year 3

Owner N320,000 N336,000 N352,800

Managers N135,000 N141,750 N148,838

Mechanics N3,150,000 N3,307,511 N3,472,897

Customer Service Associates N270,000 N283,503 N297,681

Sales & Administrative N440,000 N462,003 N485,106

Total People 120 136 152

Total Payroll N4,315,000 N4,530,767 N4,757,322

Financial Plan

QDAR expects to raise much of its own capital, and to borrow on a guaranteed ten year SBA loan. This provides the bulk of the current financing required.

7.1 Break-even Analysis

QDAR's break-even analysis is based on the averages of the first-year figures for total sales by units, and for operating expenses. These are presented as per-unit revenue, per-unit cost, and fixed costs. These conservative assumptions make for a more accurate estimate of real risk.

Break-even Analysis

7.2 Fulfillment

The fulfillment of services for QDAR is provided by the director and his team. The ultimate deliverable is the Director and his team’s expertise and problem solving ability, coupled with an open mind and ease of communication that will result in the customer’s complete confidence in immediate and lasting results.