EXECUTIVE SUMMARY: Executive Professional Cleaning Services (EPCS) is a start-up office cleaning service provider servicing the needs

of offices in Puerto Rico. EPCS will strive to provide clients with professional and first-class quality service. Services will include office cleaning (including removal of trash, dust and cleaning of all surfaces, sweeping and mopping floors and cleaning of doors and walls as needed), furniture cleaning, floor waxing, floor stripping and sealing, carpet cleaning, window cleaning and finally, cleaning of bathrooms and kitchen areas. The Administrator and Supervisor of EPCS are the owners of the company. With the advice from their CPA and attorney, they chose to incorporate EPCS as a Corporation. Potential target customers include small (0-49 employees) and medium offices (50-499 employees) within the metropolitan area, which include the towns of Bayamon, San Juan, Caguas, Trujillo Alto, Carolina and Guaynabo. According to the US Census Bureau, the number of companies in the metropolitan area of Puerto Rico indicates a greater number of small businesses, followed by medium and large businesses. The owners will commence business operations with three (3) full time employees and will increase to six (6) throughout the first year, given that the company achieves the forecasted growth in business. These employees will be dedicated solely to providing quality cleaning services to EPSC‟s clients. The owners will interview, hire/fire employees, monitor performance, direct sales, bill clients, purchase equipment & supplies, observe daily financial information, and assist with cleaning duties if necessary. They will work along with their employees to assist during the busier months. Employees are vital components of providing a professional, quality cleaning service; therefore, EPCS will provide adequate pay and extensive application processes to extract the highest

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quality of customer service from all employees. EPCS will mainly service the offices 5 days per week or the time required. EPCS estimates an initial investment of $41,500, which will be utilized primarily in purchasing cleaning equipment & supplies, lease payments, payroll, and additional working capital needs throughout the first year. Since the owners will each invest $5,000, EPCS will need debt financing of $31,500. EPCS projects a loss of $14,735 in Year 1 with operating expenses of $199,593, while in the following years there is an increase in revenues. Although the projections reflect losses during the first year, the calculations of net present value (NPV) are positive. This means that EPCS‟s owners would receive a higher return on their investment than if they were to invest elsewhere (based on their expected return on investment for other projects). Consequently, the owners should invest in the company.

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Specific objectives that EPCS will seek to meet over the next years include: to build a substantial. 3 .INTRODUCTION Executive Professional Cleaning Services (EPCS) seeks to establish itself as a leader in office cleaning in the metropolitan area of Puerto Rico. listen attentively to the needs of the client and communicate this information effectively to cleaning crews. to build healthy gross margins by establishing itself as a significant buyer and reducing pricing on cleaning supplies. and documented processes for operations and cleaning practices. to build operations infrastructure. to train low-cost labor to be more productive and efficient in providing cleaning services. To become successful in the office cleaning business. EPCS seeks to ensure that businesses have a spotless office environment to support the work they do and have their company focus completely on providing their services. regular client base. including professional management. EPCS must: foster an environment of employees empowerment from day one of operations to make sure cleaning crews clean well (carefully) and clean smart (efficiently). and to create a culture of productivity and resourcefulness for all staff by encouraging the best ideas and cleaning procedures in order to rise to the top and be able to properly reward its employees for their contributions. listen to the needs of its client to do the job they need done. research and remain experts on the greenest cleaning practices and products. and responds to the demands of the environment. The company trains and trusts its employees to clean well and clean smart. and remember that the cleaning must meet or exceed clients expectations to be considered done.

4 . Even if the companies try to cut expenses by laying off workers. OPPORTUNITIES: Market is showing consistent high growth. and cleaning these commercial areas is needed in all 4 seasons.INDUSTRY ANALYSIS: The commercial cleaning industry is one of the fastest growing and most productive occupations to invest in. Dedication to customer satisfaction. Low barriers for entry of competitors. THREATS: High number of competitors makes replacement of services easier. Offices are running all year round. This industry has an increase in revenues of 16% every year. STRENGTHS: Highly trained personnel Owner experience in the cleaning industry New to market WEAKNESSES: Scarce resources base New market with unlimited opportunities. SWOT Analysis: Commitment to quality service. they cannot stop providing a clean area for their remaining employees. Cleaning offices is not a seasonal business.

SERVICES EPCS is a new cleaning service business specializing in office cleaning. The company will operate from a central office and storage facility and use the work of cleaning staff training to serve customers in Puerto Rico. foot per week cleaning. footage rather than a flat fee due to their varying sizes. The proposed pricing strategy is $0. The client may opt for additional cleanings during busier months/holidays. EPCS strives to be competitive within the market. During the developmental stage. will pay $0. Services to be offered by EPCS will focus on the office space and includes:  Office cleaning (including removal of trash. contracted work. the owner will work alongside employees performing the services. This will allow a cost structure affordable to all as well as an operational system used to distinguish cleaning time needs and/or limits for each office. Floor Stripping and Sealing. Cleaning the bathrooms and kitchen area(s). Floor wax. dust and cleaning of all surfaces.500 sq. $3. Window Cleaning. Carpet Cleaning. EPCS deems it necessary to charge rates to offices based on sq. 5 . ft.000 per month during regular months.30 x 2. thus providing labor cost savings. an office occupying 2.500 = $750 per week. sweeping and mopping floors and cleaning of doors and walls as needed). but will focus on offering the highest quality service. Therefore.       Furniture Cleaning. This strategy will succeed by keeping operating costs at a minimum and gaining repeat business through quality.30 per sq.

few cleaning business seek to serve this market because of the cost in doing so. the purpose of obtaining an office front is to exude an enhanced professional appearance to current and potential clients. Small offices are targeted as well as large. Market Segmentation: 1. business owners generally require employees to do their own cleaning. The space will accommodate meetings with clients and employees as well as storage for equipment and supplies. MARKET The market for office cleaning in Puerto Rico (metro area) includes small offices (1-49 employees).600. if customers/clients visit their office spaces. they can cancel without penalty. Bayamon with a rent of $800. assuming they are saving money through this work. Although cleaning services do not require traditional office space. although it is expected that they will be more likely to use our services after its record of customer service and operational success is established by work with numerous smaller clients. and their appearance to customers. 6 . Small Offices: Either newly established ventures. but also that by having professional cleaners maintain their offices they will increase morale. The contract will offer a 30-day “right to cure” clause in their contracts – if the client is not satisfied. Therefore. productivity. EPCS must show these businesses not only that they do not save money by having employees do this work. The office will be located in the Main Santa Rosa Avenue. or small businesses designed to remain small. medium offices (50-499 employees) and large offices (500 employees and up). arriving at a total yearly lease expense of $9.EPCS contracts will have duration of 1 year.

Target Market Segment Strategy: EPCS will build its expertise from the ground up. Large Offices: This group accepts the need to outsource their office cleaning to professionals and is interested in working with vendors who can handle specific requests and take care to protect the information.2. While larger clients will not be turned away as the business starts out.S. Table 1. Medium Offices: This group has a growing acceptance of the need for professional cleaning services and is concerned primarily about price. it is expected that they will be more 7 . Figure 1. by building a successful base of smalloffice clients. moving on to medium-office clients and then large-office clients. The number of offices in the towns that make up the metropolitan area. security. Market Analysis: According to data available in the U. Market Analysis. and equipment within their office spaces. followed by medium and large Businesses. Census Bureau on the number of companies in the metropolitan area of Puerto Rico indicates a greater number of small businesses. 3.

effective personnel training will result in an efficient allocation of resources for the company. Indirect Competition: All the other companies localized outside the Metropolitan Area. professionalism and competitive prices. To accomplish this. Competition:   Direct Competition: Companies localized in the Metropolitan Area in Puerto Rico. high productivity and an employee that is able to take leadership roles within the organization by developing and improving EPCS‟ business strategy. thus enhancing EPCS‟s reputation. the best way to achieve steady growth in business volume will be providing a high quality service to our client base. EPCS will develop a quality-based service image focused on responsibility. even though a good marketing campaign requires a good marketing strategy. By providing excellent services at competitive introductory rates. the clients will get to know the services and will seriously consider becoming repeat customers and making referrals. the recruited personnel must have the personality and characteristics that exhibit EPCS‟ vision. Working within this framework EPCS will increase its customer‟s base to a tipping point that will enable it to adjust its structural organization and hire/outsource additional employees to maintain a quality service reputation while increasing market share. BUSINESS STRATEGY Initially EPCS will provide its services to small and mid-sized offices within the Metropolitan Area.likely to use our services after its record of customer service and operational success is established by work with numerous smaller clients. 8 .

The second stage involves newspaper advertisement. cold calling sales and email offering our services. Advantages of a Closed Corporation: (less than 75 shareholders)  Can operate without a board of directors and can be led by a single shareholder. making brand recognition a strong advantage for EPCS. along with business conventions and industry gatherings. foot per week of cleaning. BUSINESS ORGANIZATION We understand that the organizational structure more convenient for us is the private corporation for profit. The third stage will be engaged when EPCS has become a recognized established company. it would be affordable to all as well as an operational system used to distinguish cleaning time needs and/or limits for each office. as EPCS consolidates its efforts. This decision is based on that this option represents a lower rate of income taxes and protects the shareholders in their personal capacity. as mentioned before. 9 . conventional brochures will illustrate variety among our cleaning service packages. a webpage and social networking advertisement.30 per sq.The business strategy will consist on three stages: the first stage. The sales strategy. will be based on a standard rate based on sq. Consequently. Based on cost of materials and time required. additional marketing strategies will be employed. footage in order to accommodate varying office sizes and to provide clients with a consistent and fair price. EPSC has decided on a proposed pricing strategy of $0. this will comprise of on-site one on one client visits. contacts and other relevant information. This price is below the market average for many cleaning service companies in the industry. near launch operations. island wide radio and TV advertisement.

 Contributory benefits: Corporations are entitled to deduct expenses and payments for their administration and depreciation of movable property.  Double taxation. rights against self-incrimination). Legal protection: In cases of litigation by any corporate management. Disadvantages of a Corporation:  A corporation can„t claim constitutional rights possessed by individuals (right to defend themselves in court. corporations will pay for earnings from operations and the owners will paid in their personal character for the accrued dividends. ORGANIZATIONAL STRUCTURE: Shareholder (2) Administrative Personnel (1) Supervisor (1) Employees (3) 10 .  Corporations have borrowing margin wider according to the composition of the shareholders or the number of shares issued. it would sue the corporation and not to its owners in their personal character. the right to claim protection on privileges and immunities.

etc. Start-up costs will include cleaning equipment. practice direct sales. 1 supervisor and 3 employees. 1 administrative personnel. The loan has a 4. Certified Public Accountant. All cleaning equipment & supplies quotes are based on current J&M Depot. The shareholder. Inc. bill clients.07.000 each from their personal savings. A detailed list of start-up expenses is included among the following pages (See Appendix II).500 in loans. 11 . and assist with cleaning when necessary. The 3 employees with be paid a competitive salary with the purpose of attracting employees who are efficient and high caliber. maintain the website. office equipment & supplies. purchase equipment & supplies. EPCS is seeking $31. FINANCIAL ANALYSIS: The total project cost of EPCS is $41. cleaning supplies.The company will consist in 1 shareholder. This will require a monthly payment of $ 331. excluding professional activities performed by his advisory team consisting of his banker.04 (See Appendix III-Table Amortization). additional training will be offered to the employees. wholesale prices. The 2 owners are contributing $5. also the administrative personnel. and working capital. hire/fire employees. observe daily financial information. The shareholder will interview. insurance agent. Also.8% interest for a term of 10 years. will be responsible for all management duties. perform payroll duties. The owners of the company will assist the cleaning employees during the probable busier months. The supervisor is in charge of monitoring performance and assistance of cleaning.428.

Cash Budget: 12 .

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Annual pro-forma income statements: 14 .

Annual pro-forma balance sheets: 15 .

This is caused because the cost of capital is a critical value driver that values the cost of the company's funds. if some assumptions are change. we should not invest in the business. If the NPV is negative. This positive value implies that we should make the investment. the cost of capital. Therefore. the NPV will be decreasing and eventually be negative (See table 2). for example.NPV analysis: Sensitivity analysis: Using the calculations of Net Present Value we can determined that if the net cash flows continues increasing in a 4% each year with a cost of capital of 10% the NPV is positive. 16 .

studying the target market of EPCS in Puerto Rico and developing marketing strategies we can conclude that it is positive and viable to initiate the company of cleaning services to offices. Different Scenarios of cost of capital and its NPV COST OF CAPITAL 10% 20% . . the net present value maintains positive to an increasing net cash flow of 4% for the next years. Because our strategy is to served primarily to small and medium offices to help them concentrate in their strategy to increase revenues and not worry about cleaning. Using the financial sheets.680 . we expect that the target market accepts positively the business and uses the services that Executive Professional Cleaning Services has to offer.Table 2.We could also say that is viable to begin operations with the increasing revenue of 16% in the industry. 72% NPV $323. with cost of capital from 10%. for the next years there is revenue increasing among the years. For the first year we will see a loss due to the initial cost for the opening of the business. We are convinced that we can meet the financial projections that we have established securing the EPCS success. . . Our establishment will be localized in Bayamon capturing the metropolitan area sector. 17 .793 $197. -$106 CONCLUSION: After analyzing all the financial sheets. Then. .

html    http://cleaningservicecomparison.us/industriales/quimicas/ventajas-y-desventajas-de-unacorporacion/ APPENDIX Appendix I -Feasibility Study: For the selection of the location of the establishment we made a careful analysis of the most important attributes to the success of our business.jsp?id= http://autos.com/companyindex/Puerto_Rico/Janitorial_Services/3D171E19A AE058530B901E5B535F008E-1.allbusiness. the office location will preferably be in Bayamon.census.gov/econ/cbp/index. Description: Weight 10 40 5 25 15 5 100 Description Amount of offices nearby in which provided similar Office Density services Proximity from the office to the location were the Proximity to Services services are provided Accesibility Rent Traffic Accumulated Atraction Access to the office Cost of the rent Amount of traffic from the office to the location were the services will be provided Nearby businesses must attract similar customers Category 18 . Based on the analysis.yahoo.html http://www.com/commercial-cleaning-pricing. Below is a list of principles and the weight we give to each attribute.REFERENCE   http://www. based on the basic principles of the method "weighted site selection".industrias.com/ford-truck/e-series-van/2011 http://www.

ENVELOPES.00 $150.99 $89.00 $768.96 $2.733.99 $179.00 $250. FAX MULTI-LINE TELEPHONE FORD E-150 CARGO VAN Unit Price $366.601.601.Analysis: San Juan Bayamon Office Density Proximity to Services Accesibility Rent Traffic Accumulated Atraction Total 2 35 3 5 10 5 60 5 30 5 17 9 4 70 Caguas 7 25 5 20 5 4 66 Carolina 7 27 5 15 10 3 67 Appendix II – Equipment and Supplies List EQUIPMENT Quantity 3 3 1 4 1 1 1 2 1 1 1 U/M Description SC890 CHAMBER VACUUM MODEL 20 HEAVY DUTY FLOOR MACHINE SELF-CONTAINED EXTRACTOR MOPPING COMBO PACK PERSONAL COMPUTER 4 DRAWER COMMERCIAL VERTICAL FILE EXECUTIVE DESK DESK CHAIR ALL-IN-1 COPIER.63 $327.00 $117.66 OFFICE SUPPLIES Description ACCESSORIES/DECORATION BUISNESS CARDS PENS.00 $117.99 $60.95 $1.63 $327.00 $24.000.00 $32.380.00 $24.98 $499.000.10 $151.99 $60.098.16 $1. Subtotal Amount $368. ETC.861.380.54 $1. PRINTER.00 Subtotal Amount $1.00 19 .10 $606.85 $1.32 $953.99 $499.

35 5.85 4.00 54.20 27.96 23.80 4.25 36.40 21.5% THICKENED 32 OZ T/C BOWL TILET/PORCELAIN CLR 32OZ BOWL CLEANER 23% 32 OZ FURNITURE POLISH 16 OZ AEROSOL (GLAZE) STAINLESS STEEL WATER BASE 16 OZ (BRITE) STAINLESS STEEL OIL BASE 16 OZ (FLARE) 5152 CHASE** DUST MOP TREATMENT 19 OZ DUST MOP WHITE 18" DUST MOP WHITE 24" Unit Price 13.00 9.80 46.30 23.00 31.60 23.80 17.60 4.95 84.90 6.5oz ESCOBA RECORD CON PALO RECOGEDOR PLASTICO LATEX GOLVE MASK 50 CS FIBERGLASS MOP PAD 20" 5100 PAD 20" 7200 PAD 20" 4100 PAD 20" 3600 MAPO RAYON BLUE 16oz MAPO RAYON 24oz MAPO RAYON 20oz 24 X 24 08 MIC BLACK 1000 CS 30 X 37 10 MIC BLACK 500 CS 30 X 37 10 MIC NAT 500 CS 43 X 48 16 MIC BLACK 200 CS GLASS CLEANER 32 OZ HAND SOAP GALON---ELITE Roll Towel 12/600 WHT Roll Towel 12/350 WHT Roll Towel 12/350 NAT Toilet Tissue 12/1000 2 Ply Husky Ultra High Speed Finish Galon Husky Ultra High Speed Finish Pail Husky H/P UHS Premium FL Finish Galon Husky H/P UHS Premium FL Finish Pail Husky Floor & Concrete Sealer Pail Husky Versatile Premium FL Sealer Husky Rinse Free Floor Stripper Pail H/D Stripper Pail Spray Buff.50 67.00 25.50 67.00 27.20 57.35 3.00 26.00 62.25 71.00 77.15 5.80 46.95 4.85 42.95 26.75 15.40 15.85 97.99 23.95 22.95 24.00 23.00 27.50 9.95 23.95 23.20 67.90 1.00 12.95 4.80 80.00 6.80 4.75 3.50 9.00 26.00 36.40 19.60 28.20 67.00 64.80 39.60 84.25 71.80 80.95 24.30 23.00 72.95 42.00 56.60 84.25 23.40 52.00 23.65 32.90 19.95 16.60 19.95 26.41 20 .5 18.50 144.50 39.00 84.00 28.50 18.80 60.00 51.00 23.50 71.40 30.90 45.20 16.80 65.CLEANING SUPPLIES Quantity 4 4 4 4 4 4 4 1 1 1 4 4 4 1 4 1 1 1 1 4 4 4 1 1 1 1 1 20 2 2 2 2 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 2 4 4 4 U/M EACH EACH EACH EACH EACH EACH EACH DOZEN DOZEN DOZEN EACH EACH BOX CASE EACH BOX-5 BOX-5 BOX-5 BOX-5 EACH EACH EACH CASE CASE CASE CASE CS-12 GALON Case Case Case Case Box-4 Pail Box-4 Pail Pail Pail Pail Pail Each Galon CS-12 CS-12 CS-12 CS-12 CS-12 CS-12 CS-12 CS-12 Each Each Each Description DUST MOP WHITE 36" DUST MOP BLUE 18" DUST MOP BLUE 24" DUST MOP BLUE 36" D/M FRAME 5 X 18 D/M FRAME 5 X 24 D/M FRAME 5 X 36 URINAL SCREEN N/P W/BLO URINAL SCREEN W/BLOCK BOWL BLOCK (SW) 3.95 9.Rejuvenator 12/32 SPRAY BUFF REJUVENATOR GL SPRAY & WIPE CLR DEGRACER 32 OZ N/A BOWL CLEANER 32 OZ BOWL CLEANER 9.30 64.50 9.25 19.50 71.00 19.50 64.80 2380.00 23.60 6.40 54.00 51.95 Subtotal Amount 52.20 26.00 23.65 1.

00 $5.380.41 $768.66 $2.428.07 Appendix III: Amortization Table 21 .733.546 $41.PROJECT COST SUMMARY Description EQUIPMENT CLEANING SUPPLIES OFFICE SUPPLIES WORKING CAPITAL Subtotal Amount $32.

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