Section 3

Team 6
Fall 2022

Business Plan
Business Name: Boat-Thru
Business Idea: Automated, drive-in, hull cleaning and detail service

Email Address
Alex Barna Alexander Barna
barnaaj@dukes.jmu.edu
Jacob Carney Jacob Carney
carne4je@dukes.jmu.edu
Matthew Carpenter Matthew Carpenter
carpe3mc@dukes.jmu.edu
Benjamin Cousino Benjamin Cousino
cousinbf@dukes.jmu.edu

1
 Heather Moore Heather Moore moore2hv@dukes.jmu.edu
Nikolas Talley Nikolas Talley talleyna@dukes.jmu.edu
Alex Walter Executive
Alexander Walter
Boa -Thru
waterad@dukes.jmu.edu Summary
Benjamin
t
Address 1000 Heritage Center Circle, Round Rock, TX,
Cousino
Phone
: (703 -33 -369
78664
E-mail
: )[customerservice@boatthru.co
6 7
: m]

Management Business Description Uses -powere

:Titles automated: mechanical brushes
high to clean
d
:- Chief Executive Officer exterior of boats while the boat ains in
the
- Sale
(1) Administrator water.
rem The boat owner can select the the
- Office
s and Book Administrator
(1) that includes interior detailing by
option
- (1)
Shift Administrator technicians that occurs while the exterior
detail
- Sales
(2) Technician the boat is being
of
- Detail
(2) Technician Service
washed.Boat owners will pull their boat
Industry
(6) NAICS our
: washinto as the wheels and exterior
-: 81119 - Codes:
Car conform to the hull and sides of the
brushes
2 Wash while the owners complete sale
boat
Number of Employees: 13 transaction
the with technician The s boat
Amount of Financing awill get off their boat
. as the boatowneris
- $1,50 ,00
Sought: through the
guided and mechanicall
Investment
0 0 cleaned.
wash Detail technicians
being will
y clean
- Friends &
Sources: : interior of the boat during exterior
the
- Bank
familyloan: $750,000 Competitive
cleaning Ther are
Use of Funds:
$750,000 legitimate
Advantage: s in the
e twoand
- Boat wash purchase & operating service is
competitor more favorable
market ourour
due to
Service
expensesselling : efficiency and our environmentally
increased
- price
$250/$20 per service
friendly
0 wash .Markets Our target market is
boats
: on Lake Travis, whether it’s marinas
registered
privately owned
or
boats.

Distr bution Our service channel exists directly our customers (on
i Channels: with marina)
Competition We only tw direct s, ant -fouling paint Drive-In Boat Wash, whom
wash
: boats 3 minutes
have quickerothan, and because theyi do not
competitor and operate Lakewe Travis, there is no for
thei
on direct Ant -fouling paint, our second competitor, damages the
concern environment as the
additive
r wears down andi pollutes
competition. the water. This, we do not Indirectly, we have competition
copper
companies
do. at produce equipment to be used by people who prefer of to manually wash their boat. We
exceedingly
th better
are thei indirect competition because we save people over an hour of time by
their
than boat for r washing
them.
Financial Projections
(Unaudited): 202 2 2 2 2 20 6 20 6
Revenue $1,002.7
3 $2,33
0 4 $2,64
0 5 $2,64
2 $2.201.
2 (dollars in
EBIT
: 538
$39.2 $532.1
1 $779.1
6 $750.6
6 $593.2
5 thousands) 2
: 9 2 3 2 3
Elevator Pitch: Do you struggle washing your boat or are you too lazy to pull your boat out

of the water to clean it? A car wash for boats, Boat-Thru is the one stop shop for boat

exterior washing and interior detailing. We aim to make the cleaning process of boats

quicker and easier. Our apparatus uses industrial brushes to clean boats, so they are back

on the water in no time at all. With our revolutionary process design, we preserve the

environment by eliminating the need to purchase anti fouling paint for the hull of boats.

Product/Service Description: Boat-Thru is a machine-operated boat washing company,

like a car wash, that cleans boats in an environmentally friendly way. Additionally, boat

owners can choose to purchase an interior detailing option performed by professional

technicians while the exterior of their boat is washed. Boat-thru offers an exciting, new way

to keep boats clean, and safe for the environment (KEMI,2022).

Competitive Advantage: Drive-In Boatwash is one of our two competitors (Drive-in

Boatwash, 2019). They are a pull-in boat cleaning service opposed to our drive-thru

function. Our process is much more efficient, eliminating the need to tie your boat up on the

bow and stern and the need to reverse out of the boat slip which poses a liability threat.

This allows our process to be three minutes quicker per wash. The second main competitor

is anti-fouling paint. According to the study done by the NIH, the copper in the product

proves to have a toxic effect on the marine environment (KEMI,2022). Lastly, our third

competitor is boat detailers in the Travis County, Texas area that could take business away

from us. Boat-Thru trumps our 3 competitors because of our efficient and environmentally

friendly advantage.

Value Proposition: This is a good investment due to the relatively low market share

required to break even. Alex Aronson with Redbook states that there is also extensive

profitability potential given the wealth on and around Lake Travis, Texas (Aronson,2020).

This long-run profitability is additionally a result of low taxes as well as low chances of

catastrophic natural disasters.

3
Business Strategy: Boat-Thru’s corporate strategy involves differentiation in our offering

of a service that saves boat owners’ time by performing a boat wash in less time than any

competitor offers. Additionally, using our boat wash is infinitely more environmentally

friendly, serving as an incentive for customers to use our service.

Business Location: Our business will be located outside of Lake Travis in Austin, Texas.

We decided on this location because it eliminates seasonality and because state income

taxes are relatively low. According to Lake Travis Coalition, the temperature never drops

below 60 degrees year-round(Lake Travis Coalition). Hurricanes are not a direct threat for

residents in Austin due to the distance from the Gulf Coast (Ayers, 2022). More specifically,

we decided on Lake Travis due to its relatively large population and the fact that it’s the

forth wealthiest lake in America as the average house costs $10.86 million, according to

Alex Aronson (Aronson,2020).

Outsourced Functions/Justifications: We decided to outsource the construction and

installation of each boat wash. This is being done by Jacob’s Engineering, a firm based out

of Texas. We chose Jacob’s because of same-state proximity resulting in a quicker response

time on repairs. Additionally, we are outsourcing to a CPA for our start up in year 1 to set

up books to be run by the office and book manager.

Financial Performance: Although our business does not profit until year 2, due to the

expense of equipment, there are ample profit figures down the road. This is due to the

extremely large contribution margin of our service operations. For every wash that is

performed, we profit between $83 and $133. At our current throughput rate, and demand,

we project sales, based on Travis County census data, on average of 3 to 4 boats per hour

for each individual boat wash (Census Bureau, 2011). These numbers are tremendous. In

year 2, we add a boat was which will ultimately double our total profit for the following

years. Our year 5 profits are upwards of $500,000.

4
Management Exhibit 1: Organizational Chart

Boat-Thru
Section 3, Team 6
October 11, 2022

Changes in Staffing:
- In year 1 our staffing is as shown in the organizational chart
- In year 2 we will add 3 detail technicians, 1 sales technician, and 1 shift administrator to
manage our additional boat wash. The existing excess of workers makes up for the
disproportionality of the changes in workers.
- In year 3 there is no change
- In year 4 there is no change
- In year 5 there is no change

5
Management Exhibit 2: Pay, Mandatory Deductions, Benefits, Knowledge, Skills, Abilities and
Motivation Table

TeamName:BoatThru Section 3 Team6 Date(m /d /year) 9/19/202

(ifwageisusedforaposition,dothecalculationofyearlypaybasedonhourlywageandtoalhoursworked)
Compensation MandatoryPayrol Deductions Benefits
ProjectedEndof Proj e cte d E nd of A ny
Position (Sal ry/Wage-Sal ryor Bonusor #for Year2Sal ryor Year2Sal ryor Mandatory Ben fits- Ben fits- other Ben fits-
W)(Ful-timeAs umed, Wagefor Com is ion position Wageincluding Wageincluding FICA FUTA* SUTA WC Deductions- HealthCost Retirement Ben fit Total
Part-time-PT%) position) bonus/com .Each bonus/com .al Total Cost Cost-List
positions line17
6
Marketing Exhibit 3: Market Segmentation Analysis/Target Market Selection
Size (# of Priority
Target Name People or Growth Description level for Justification for Targeting
Households Projection targeting
in Segment)

Boat owners who live on the lake are less likely to take their boats out of
the water when their boats are not in use. This can cause their boats to
build up more fouling and cause them to have the need to clean their
boats hull more often. Also, because they aren't leaving the lake, our
location will be more convient for them to get to. Typically when owners
are using their boats, they are relaxing and taking time off from work.
They will see our service as something that will help them enjoy their
0.2% rate over the
22,000 boats Boat owners that live in the Lake Travis, time off rather than having to manually clean it themselves. To
Lazy Bones next 5 years 1
Approximately Travis County area. determine the growth rate, and the size of this segment, we determined
(discover boating)
that 2.02 percent of people in Texas owns boats (approximately
643,000 registered boats in Texas, and a population of 29.1 million
people). This would mean there are approximately 28,000 boat owners
in the Travis county area since there is 1.251 million people in the area.
Being that our company is based in Texas, there are going to be a lot of
DIYers, so that would take approximately 25% of the population giving
us 22,000.

A large portion of the boats that will be on Lake Travis are going to come
200,000 from people who do not live on the lake but come every weekend or
0.3% rate over the Boat owners/renters that do not live in the
Visitors People 2 throughout the week. Approximately 200,000 people visit Lake Travis
next 5 years Lake Travis area but will boat on the lake.
Approximately each year. These people will still have algae buildup on there boat and
will need our service.

Our product eliminates the need for anti-fouling paint which causes
harm to the enviroment. Enviromentally focused people will use our
Approximately .0128% rate over Boat owners that want to elimate the use of
Tree Huggers 3 product in order to eliminate the need for anti-fouling paint which will
17,920 the next 5 years anti-fouling paint.
protect the environment. 64% of Lake Travis boat owners would like to
see a change in the environment.

It is not likely that

Marinas that will offer our business as a Marinas on Lake Travis will pay our business "x" amount of money per
there will be more
Marinas 18 Marinas incentive for their morrage renters to rent 4 month and will be able to offer our boat wash service to the morrage
marinas in the next
from them renters monthly for no extra charge.
5 years.

It is not likely that Boat rental businesses that will use our Our company is going to target boat rental businesses that will use our
Boat rental there will be more service throughout there boating season to service throughout the boating year to clean up their boats for the
18 Boat Rentals 5
businesses boat rentals in the clean up the boats for the renters that are renters that are paying top dollare for their products. We will offer this
next 5 years. paying top dollar for their products. at a discounted rate in order to get the businesses more interested.

Boat owners that would rather clean their This target will be the least likely to pay for our service as they prefer to
6,000 boats
DIYer 0% increase boat themselves compared to using our 6 clean their boats themselves. Either to save money or for their own
approximately
service. enjoyment.

7
Marketing Exhibit 4: Market Quantification
Exhibit #2: Market Quantification
Tot Mkt Mkt Growth Market Annual Unit Unit Price or Annual $
Year Potential (# Projection** Share*** Product Sales Weighted ASP Revenue
Customers)*
Year 1 6600 0.02% Product 1 Wash 1,280 $200.00 $256,000
15400 0.02% Product 2 Wash + Detail 2,987 $250.00 $746,750
22000 19.40% Totals 4,267 $1,002,750
Year 2 6612 0.02% Product 1 Wash 3,330 $200.00 $666,000
15428 0.02% Product 2 Wash + Detail 7,770 $250.00 $1,942,500
22040 0.04% 50.36% Totals 11,100 $2,608,500
Year 3 15458 0.02% Product 1 Wash 3,780 $200.00 $756,000
6625.2 0.02% Product 2 Wash + Detail 8,820 $250.00 $2,205,000
22084 0.04% 57.05% Totals 12,600 $2,961,000
Year 4 6650 0.02% Product 1 Wash 3,780 $200.00 $756,000
15517 0.02% Product 2 Wash + Detail 8,820 $250.00 $2,205,000
22168 0.04% 56.84% Totals 12,600 $2,961,000
Year 5 6636 0.02% Product 1 Wash 3,570 $200.00 $714,000
15548 0.02% Product 2 Wash + Detail 8,330 $250.00 $2,082,500
22212 0.04% 53.57% Totals 11,900 $2,796,500
*To determine our potential market we used our market segments. There are roughly 22,000 registered boats in the area of Lake Travis. This
number is based on the population of Texas (29.5 mil) divided by the amount of people currently living in Travis County, TX (1.3 mil) this gives us
roughly 4 percent. In 2021, there were a of 583,306 registered boats in Texas. This number times 4 percent gives us 23,332. Estimating that this
number would realisticly be around 22,000 total boats in the area of lake travis. Through conducted research we are estimating that 70% of
people getting their boat wash will want the interior of their boat detailed.

**Our market potential is based on a number of factors, including people who own boats in Texas, the population of Texas the population in the
Lake Travis County area, and growth projections for the Lake Travis County area. First, there are approximately 643,000 boats registered in the
great state of Texas. There are 29.1 million people in Texas, so on average, around 2.02% of Texans own boats. Next, to calculate the amount of
boat owners in Lake Travis County, 2.02% is multiplied by the county population which is 1.251 million which is equal to 28,000 boat owners in
the area. Next to account for the percentage of boat owners in the area that will want to wash their own boats, we subtracted 25% of potential
customers to come up with the "Lazy Bones" target market. Twenty five percent is a high number, being that this service is similar to car washes,
and as of 2019, 77% of car owners had their cars washed. Since population growth in the Austin, Lake Travis County area is around 2%, if that
number is multiplied by 2.02%(percent of boat owners in texas), the growth rate is close to 0.04% annually.

***We determined our market share by combining the assumptions of the product life cycle with the 2020 MINTEL consumer trends report that
shows us our environemntally freindly practices would become increasingly popular over time.
This was determined with the calculation of potential market and estimated growth and market share to develop the number of 3 boat washes
demanded per hour with 70% being just wash and 30% wash and detail as informed by our team member's personal expereince in the industry.
This was then compared to our capacity to create our average unit sales.

Fcst by
month Units Revenue ($)
May '23 533 $83,563
Jun 533 $83,563
Jul 533 $83,563
Aug 533 $83,563
Sep 533 $83,563
Oct 533 $83,563
Nov 533 $83,563
Dec 533 $83,563
Jan '24 925 $217,375
feb 925 $217,375
Mar 925 $217,375
Apr 925 $217,375

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Marketing Exhibit 5: Positioning/Competitive Analysis
Exhibit #3: Perceptual Map and Positioning Statement

Note: Map may be expanded for greater clarity as long as total Exhibit fits on pne page
Environmentally
Friendly Boat
Thru
Hand wash
with hose &
mitts Drive-in
Boatwash

Efficiency

Fouling
Paint

Positioning Statement: Boat-Thru charges a high price for it's leading quality and swift wash
while preserving the environment. It trumps all competitors, speed and effectiveness wise,
therefore serving as the most efficient method of washing your boat on the market. Boat-Thru
eliminates the need for anti-fouling paint which saves the environment.

Additional Key competitive or market information related to Positioning-> Boat-Thru is a

unique service, because there are not many companies cleaning boats in a quick manner
(throughput rate of 15 minutes per boat). On top of that, Boat-Thru is promoting
environmental friendliness by reducing the need for boat owners to use harmful anti fouling
paint.

Strengths Opportunity
 Low employee turnover because of high benefits  Technologically innovative product
and pay  Dominance through high market share
 Services possess environmentally friendly qualities.  Wealthy consumers base
Weakness Threats
 Speed of service and uniqueness could leave  Environmental degradation of Lake Travis
doubts in the minds of customers due to climate change

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Marketing Exhibit 6: Marketing Mix

Product/Service Branding
Our brand name is Boat-Thru, with associated logo as shown, to allow for simple regognition with little to no investment
in the creation of an actual brand. The creation of a full brand would not be cost effective for our size. Within the market
our product is at the introduction stage at year 1, growth at year 2, and maturity at year 3 and 4 with the first signs of
decline in year 5.
Pricing (without detail) Pricing (detail)
Year: 2023 2024 2025 2026 2027 Year: 2023 2024 2025 2026 2027
Unit Variable Cost: 117.30 101.45 91.16 92.98 100.42 Unit Variable Cost: 117.98 101.98 91.63 93.45 100.92
Retail Price: 200.00 200.00 200.00 200.00 200.00 Retail Price: 250.00 250.00 250.00 250.00 250.00
Pricing strategy: Based on per-boat-expenses, such as wages and electricity, we decided that $200 and $250 would allow us to profit and in turn,
contribute to paying off our outsourcing expense of the construction of our boat wash.
Distribution/Location Strategy
Service Teams: We decided to locate our main office in Travis TX. This is based on multiple factors, the main reason being that our first service
location will be constructed on Lake Travis. We chose this location as it is a very popular lake with plenty of boat owners who will wish to utilize our
service. It is also a useful location for our service because we would not need to worry about seasonality since the weather always stays warm. Texas
is also beneficial to house our headquarters and first service location as it is nearby to other areas we hope to expand to, perhaps to Florida and
Louisiana where seasonality is still of little issue.
Promotional Strategy (in thousands of $)
2023 2024 2025 2026 2027
Total IMC Budget: $200,550 $466,200 $529,000 $529,000 $440,300
Advertising Exp (60%): $120,330 $279,720 $317,400 $317,400 $264,180
Sales Promo Exp (20%): $40,110 $93,240 $105,800 $105,800 $88,060
PR Exp (20%): $40,110 $93,240 $105,800 $105,800 $88,060
Other Promo Exp: 0 0 0 0 0
The key message that we will be presenting to customers is the need to use our wash in order to save time in their day as well as making a positive
inpact to the marine life by eliminating the need for anti-fouling paint. We will be spending our expenses at the Central Texas boat show January 21-
23, 2023. At this boat wash we will be offering a free interior detail with the purchase of the exterior wash, enticing customers to use our service.
This boat show will get our name out there while educating the public as our business is kick-started exponentially. This all gives the public a vision of
how our service will benefit them.
# of Salespeople: 2 sales technician (1 on boat wash 1, 1 on boat wash 2)
Compensation Method: $52K + pooled tips(with other onsite employees)
Year 2 we will add another boat wash which we will have 1 sales technician run. These sales technicians will be operating the boat wash by pushing
the buttons neccessary to operate it as well as handling the money for the purchase of our service. The sales method that we will be using is the
payment method through a portable card reader that we can hand to our customers that are staying on their boat or hopping off of it. This card
reader will accept payments with debit cards and credit cards.

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Operations Exhibit 7: Flow Chart

For each major quality step:

Quality Step What is measured? How often? How will you ensure quality?
Q1: Pull in Boat Safely pull the boat in without At most, every 12 minutes, By aligning the boat with the wheels that
damaging it. 8 hours a day. compress onto it, and then pulling it through
slowly.
Q2: Wheels attach How tightly the wheels attach to Whenever there is a boat We will have the wheel system designed so
the boat so that it does not move that needs to be washed that it can measure the width of the boat and
while being washed, potentially (every 12 minutes, 8 hours a adjust accordingly to make sure the fit is
causing damage to the boat or day). tight, and that the boat can move through the
the dock. wash smoothly.
Q3: Choose Service The ease the customer has when Per boat wash By having the customer say exactly what
choosing whether they would they want done to their boat when they arrive
like a full service done, or just at the boat washing crew.
the exterior.
Q4: Machine When washing the boat, we want Per boat wash Dedicating roughly 10 minutes per wash to
Washes to make sure the boat is far mechanical brushing of the hull and sides of
Boats/Employees cleaner, and safer for the the boat will ensure a thorough wash
clean boats environment than before it
entered the wash.
For each critical resource:
Critical Resource Brief Description Cost How many?
CR1: Boat wash The product itself consists of a car like boat $500,000 (One time cost) 1
wash using bristles to clean the boat and
wheels to guide the boats through.
CR2: Dock space Renting out the boat slip $5,000 per year 1
Main Facility Description
Our main facility is in Austin, Texas at the VIP Marina on Lake Travis. In the marina, we connect our boat slip to
the outermost dock allowing for boats to be guided completely through the boat wash. Unlike docks that are in a U-
shape, ours has platforms in a parallel manor. This gets rid of the need to back out, making the wash more efficient.
The size of the docks will be 40 feet long and are spread out 25 feet allowing for bigger boats to travel through the
wash. Our boat wash system will be connected to the two docks with a collection bed underneath for the antifouling.
When customers first approach the boat wash there will be a set of tires on either side of the dock that closes around
the boat and conforms to the shape of it. This allows the boat to be guided through the wash at a regulated pace. A
stationary set of brushes along the docks and underneath the boat will clean it as it moves through. The main part of
the dock is where our main operations will take place and where necessary employees will gather. We will have a
seating area that is on the dock for any of the customers that will stretch along the dock being 40 feet long by 10 feet

11
wide. This is available as an option for any customers that want to get out of their boat during the process of their
boat being washed on the exterior and is mandatory for any boat that is getting the interior of their boat washed.
Operations Exhibit 8: Quality

Indicate the Why is this dimension important, given your Identify the Quality
Dimensions of industry & target market? Step(s) on the Process
Quality on Flowchart / Service
which you will Blueprint to which this
focus. corresponds.
Time For us to have the upper hand in the market, our Entire process / duration
service needs to be proficient. Customers should not of wash
have to wait long for their boat to be cleaned and
will be satisfied with the cleaning.
Consistency This dimension is important because it enables us to Mechanics of exterior
easily handle variability (boat sizes) better than any cleaning
competitor. To maintain customers, we need to do a
good job with exterior and interior cleaning.
Otherwise, they may go to a competitor (Drive-In or
wash manually).
Special Features As Boat–Thru removes algae, mollusks, and other Exterior
microorganisms that slow the boat down, our cleaning/Informing
customers will no longer find it necessary to use customers that they no
anti-fouling paint, which is harmful for the longer need anti fouling
environment. Without anti fouling paint, Lake Travis paint to keep their boats
will have less chemicals soaking in the water (from sailing at full speed
anti fouling paint) creating a safer, and cleaner (Marketing aspect)
ecosystem for water life, and humans alike.
Use the space below to describe any additional Proactive Quality Assurance Plans that
are not connected to a specific activity on your Process Flowchart / Service Blueprint.
 Maintain regular maintenance of the machine.
 Train employees in how to respect customers
 Having a quick and easy way for customers to pay.
Describe any reactive quality assurance plans. Include a recovery plan should a customer
receive poor quality goods and/or services.
 If a customer sends a picture of their boat still dirty within 5 days after we wash
their boat, we can deem our wash-job as poor, and they can come back to receive a
free wash to finish the cleaning.
 Should a customer be unsatisfied with how we cleaned the boat, we will re-wash
the boat to their liking, being that the boat is truly not clean.

☐ NA ☒ TQM ☐ Six Sigma ☐ ISO ☐ Benchmarking ☐ Other (specify what):

☐ Other (specify what):
TQM is a process improvement methodology that focuses on continuous improvement of
organizational processes. This is great for our service and is reflected in the fact that after 1 year
of operations, we will install another boat wash on Lake Travis which will enable us to service
twice the number of boats per hour (10 boats/hour) as before (5 boats/hour). Therefore, it’s
1
2
evident that TQM’s improvement methodology would serve as optimal guidance in our pursuit
of an ideal service.

Operations Exhibit 9b: Inventory, Suppliers & Distribution

Item(s) Supplier Reason for Supplier Frequency of System of Mode(s) of

Name & selecting this lead replenishment Management Transportation
Location supplier time (in (in days)
(City, days)
State,
Country)
Marine 31 Marine 31, Provides quality 2 to 7 360 Materials ☒ Highway ☐ Rail
Fabric & Palm fabric and leather ☐ Waterway ☒
Vinyl Cleaner Beach, cleaner. It is not Air
(5 gallon) Florida, the cheapest
$245 USA option, but that is
not our goal. It is
harbor-safe and
eco-friendly.
Scrub Brush Home A reliable supplier 2 to 7 30 Materials ☒ Highway ☐ Rail
with Iron Depot who provides ☐
Handle $61 long-lasting,
Waterway ☒ Air
effective products
Microfiber A & H A reliable supplier 2 to 7 30 Materials ☒ Highway ☐ Rail
Towels, Auto Towels, who consistently ☐
Detailing Peachtree provides quality
Waterway ☒ Air
Towels, Corners, towels
Polishing Georgia
Towels $61
SUNSHINE Simple This product 2 to 7 30 Materials ☒ Highway ☐ Rail
MAKERS Green cleans the ☐
Simple Green windows of the
Waterway ☒ Air
Glass Cleaner boats. It is more
$30 expensive than
traditional Windex
however, this
specific product is
eco-friendly

SUMMARY OF RESOURCES AND THEIR SHIFT PATTERNS

Types of Total hours # Of operating # Of full time # Of part time Shift pattern(s)
resources required per days per week (FT) resources (PT) resources
used week (for each required (40 required
type of hr/wk)
resources)
Year 1
40 hours per 5 per resource 5 0 Thursday-Monday
week for every (11pm-7pm)
resource
1
3
Year 5
40 hours per 5 per resource 5 0 Thursday-Monday
week for every (11pm-7pm)
resource

Operations Exhibit 10: Capacity & Resources

Demand Capacity Utilization Hours of Bottleneck name How will you manage
(per (per (%) Operation and description /adjust the bottleneck to
hour) hour) ensure you can
appropriately serve or
supply your customers?
At the end 3.08 5 61.5% 8 Machine Wash N/A
of Year 1 time and
Detailing
At the end 5.34 10 53.4% 8 Machine Wash Add a second Boat
of Year 2 time and Wash machine
Detailing
At the end 6.06 10 60.6% 8 Machine Wash N/A
of Year 3 time and
Detailing
At the end 6.06 10 60.6% 8 Machine Wash N/A
of Year 4 time and
Detailing
At the end 5.72 10 57.2% 8 Machine Wash N/A
of Year 5 time and
Detailing
Show your calculations for the following parameters at the end of Year 1.
Hours of Demand/month Demand/hour Capacity/month Capacity/hour Utilization
operation/month
173 532.84 3.08 865 5 61.5%
Additional resources (beyond your bottleneck) must be allocated appropriately to support
operations. Identify which resources have a significant impact on capacity at start up and
describe why these are appropriate amounts of resources at start up.
Our capacity is not limited by labor or labor goods or selling practices. Because of this the only
resource that has a significant impact on capacity at startup is our estimate of machine
operation speed. The number we have at startup for speed of the machine will allow us to
gather more data to make our process more efficient starting in year 3.
Describe adjustments you will make as resource requirements vary with time. Be specific
regarding which key resources (beyond your bottleneck) will be adjusted, when and how.
If you make multiple adjustments, explain each.

1
4
 We use minimal other resources outside of the main machine. These cleaning materials are
extremely generic and low cost so a change of supplier from year to year would not
significantly impact on our processes. Our labor structure is setup for maximum retention of
employees which should negate any seasonal hiring problems as we hire enough to always have
a backup for all onsite employees.

How will you manage seasonality? ☒NA

Due to our service location in Texas, our seasonality is extremely limited, which we cannot
effectively account for without losing efficiency.

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Finance Exhibit 11: Income Statement

Fiscal year

2023 2024 2025 2026 2027

Sales Revenue $1,002,750 $2,608,500 $2,961,000 $2,961,000 $2,796,500

COGS $502,552 $1,130,224 $1,152,746 $1,175,718 $1,199,149

Gross Profit $500,198 $1,478,276 $1,808,254 $1,785,282 $1,597,351

General and Administrative

Expenses

Salaries Expense $180,873 $271,310 $276,736 $282,271 $287,916

General Insurance Expense $700 $700 $700 $700 $700

Depreciation Expense $24,363 $48,726 $48,726 $48,726 $48,726

Rent Expense $30,667 $46,000 $46,000 $46,000 $46,000

Advertising and Promotion

Expense $200,550 $521,700 $592,200 $592,200 $559,300

Licenses & CPA $1,015 $15 $15 $15 $15

Office Supplies Expense $3,688 $5,532 $5,532 $5,532 $5,532

Credit Card Expense $20,055 $52,170 $59,220 $59,220 $55,930

Total General &

Administrative Expenses $461,911 $946,153 $1,029,129 $1,034,664 $1,004,119

Earnings Before Interest and

Taxes $38,287 $532,123 $779,125 $750,619 $593,231

Interest Expense $59,025 $56,785 $54,360 $51,733 $48,888

Earnings Before Taxes ($20,737) $475,338 $724,766 $698,886 $544,344

Income Tax Expense $0 $35,127 $53,560 $51,648 $40,227

Net Income or Loss ($20,737) $440,211 $671,206 $647,238 $504,117

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Finance Exhibit 12: Balance Sheet

As of Fiscal year
Inception 2023 2024 2025 2026 2027
Assets
Current Assets
Cash and Cash
$999,395 $935,852 $815,957 $1,477,329 $2,140,931 $2,672,040
Equivalents
Accounts
$0 $81,891 $213,028 $241,815 $241,815 $228,381
Receivable
Inventory $2,069 $0 $0 $0 $0 $0
Total Current
$1,001,464 $1,017,744 $1,028,985 $1,719,144 $2,382,746 $2,900,420
Assets

Fixed (Long-Term)
Assets
Machinery and
$500,605 $500,605 $1,001,210 $1,001,210 $1,001,210 $1,001,210
Equipment
Total Gross Fixed Assets $500,605 $500,605 $1,001,210 $1,001,210 $1,001,210 $1,001,210
Less: Accumulated
$0 $24,363 $73,089 $121,814 $170,540 $219.266
Depreciation
Net Fixed Assets $500,605 $476,242 $928,121 $879,396 $830,670 $781,944
Total Assets $1,502,069 $1,493,986 $1,957,106 $2,598,540 $3,213,416 $3,682,365

Liabilities
Current Liabilities
Accounts Payable $2,069 $0 $0 $0 $0 $0
Accrued Payroll Taxes
$0 $41,707 $93,841 $95,717 $97,632 $99,584
and Benefits
Total Current Liabilities $2,069 $41,707 $93,841 $95,717 $97,632 $99,584

Long-Term Liabilities
Bank loan $750,000 $723,016 $693,793 $662,144 $627,868 $590,747
Total Liabilities $752,069 $764,723 $787,633 $757,861 $725,499 $690,331

Owners' Equity
Retained Earnings $750,000 $729,263 $1,169,473 $1,840,679 $2,487,917 $2,992,033
Total Owners'
$750,000 $729,263 $1,169,473 $1,840,679 $2,487,917 $2,992,033
Equity
Total Liabilities and
$1,502,069 $1,493,986 $1,957,106 $2,598,540 $3,213,416 $3,682,365
Owners' Equity

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Finance Exhibit 13: Statement of Cash Flows

Fiscal year
2023 2024 2025 2026 2027
Cash Flows From (For)
Operations
Net Income ($20,737) $440,211 $671,206 $647,238 $504,117
Depreciation $24,363 $48,726 $48,726 $48,726 $48,726
Changes in Current
Accounts
Change in Accounts
($81,891) ($131,136) ($28,788) $0 $13,434
Recievable
Change in Accrued
$41,707 $52,134 $1,877 $1,914 $1,953
Salaries and Wages
Net Cash Flow From (For)
($36,559) $409,934 $693,021 $697,878 $568,229
Operating

Cash Flow (For) From Investing

Activities
Fixed Asset Purchases ($500,605) ($500,605) $0 $0 $0
Net Cash Flow (For) From
($500,605) ($500,605) $0 $0 $0
Investing

Cash Flow From (For)

Financing Activities
Long Term Debt
$1,473,016 ($29,223) ($31,649) ($34,276) ($37,121)
Borrowings
Net Cash Flows From
$1,473,016 ($29,223) ($31,649) ($34,276) ($37,121)
(For) Financing

Net Change in Cash $935,852 ($119,895) $661,372 $663,602 $531,108

Beginning Cash Balance $0 $935,852 $815,957 $1,477,329 $2,140,931

Net Change in Cash $935,852 ($119,895) $661,372 $663,602 $531,108
Ending Cash Balance $935,852 $815,957 $1,477,329 $2,140,931 $2,672,040

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Finance Exhibit 14: Notes to Financial Statements

 We used straight line depreciation for both the boat scrubbing machine and vacuum

cleaner fixed assets.

 1 month of salaries accrued are assumed to be paid in the following year

 All sales are made through debit or credit card transactions. We estimate one month of

accounts receivable collected in the year after the sale was made.

 The 7 founders contribute $80,000 each resulting in $560,000 raised internally, $190,000

raised through outside equity investors.

 We also acquired a $750,000 loan which is to be paid off over 15 years at an interest rate

of 8%.

 Most of our COS comes from direct and indirect labor including shift supervisors, detail

technicians, and sales technicians.

 Yearly advertising expenses are estimated at 20% of yearly sales revenue.

 Employee benefits make up approximately 27% of salaries and wages expenses.

 The main risks associated with the company are the low chance of failure presented by an

outsourced manufacturer for the main machine, and the continuing environmental

uncertainty presented by climate change creates another risk factor.

 Credit card transaction costs are estimated to be 2% of credit sales.

 Using only equity financing does not present a risk of bankruptcy and all liabilities fall to

the partners.

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Finance Exhibit 15: Financial Ratios
Fiscal year
2023 2024 2025 2026 2027 Industry
Liquidity Ratios
Current Ratio 24.40× 10.97× 17.96 × 24.41 × 29.13 × 1.83 ×
Quick Ratio 24.40 × 10.97 × 17.96 × 24.41 × 29.13 × 1.25 ×
Operating cycle (days) 14.90 20.63 28.03 29.81 30.69 32.64

Leverage Ratios
Debt/Equity 1.00 0.99 0.59 0.36 0.25 4.40
Times Interest Earned 0.65 x 9.37 × 14.33 × 14.51 × 12.13 × 216 ×

Asset Management Ratios

Inventory Turnover NA NA NA NA NA 31.16 ×
Receivables Turnover 24.00 × 17.34 × 12.76 × 12.00× 11.66x 30.45 ×
Fixed Asset Turnover 2.11 x 2.81 x 3.37 x 3.56 x 3.58 x 7.01 x
Profitability Ratios
Gross Profit Margin 48.88% 56.67% 61.07% 60.29% 57.12% 50.4%
Operating Profit
Margin 3.82% 20.40% 26.31% 25.35% 21.21% 15.7%
Return on Assets -1.39% 22.49% 25.83% 20.14% 13.69% 10.5%

DuPont Analysis
Net Profit Margin -2.07% 16.88% 22.67% 21.86% 18.03% 3%
Total Asset Turnover 0.67 × 1.33 × 1.14 × 0.92 × 0.76 × 0.59 ×
Equity Multiplier 2.05 x 1.67 × 1.41 × 1.29 × 1.23 × 1.45 ×
Return on Equity -2.84% 37.64% 36.47% 26.02% 16.85% 124%

Valuation
The estimated value of the company:

2022 2023 2024 2025 2026

Multiple 1.2 1.2 1.2 1.2 1.2
Projected revenues $1,002,750 $2,608,500 $2,961,000 $2,961,000 $2,796,500
Estimated valuation $1,203,300 $3,130,200 $3,553,200 $3,553,200 $3,355,800

20
Finance Exhibit 16: Financial Analysis of Financial Statements

Because of the uniqueness of our industry all ratio comparisons are made with the car wash
industry. Because of this, we expect deviations from the averages in our estimated numbers.
Liquidity
Our currency and quick ratios are not near the industry average with changes in line with our
investment in a second machine year 2 and lack of investment in subsequent years. Our currency
and quick ratios are equal because we don’t have any inventory by the end of the year. Our
Operating cycle approaches the industry average towards year 5 as our accounts receivable
balance increase to make up for the lack of inventory that made earlier years have a much lower
operating cycle.
Financial leverage
Our debt-to-equity ratio is lower than the industry average as we use only equity financing, and
the only debts we have our short-term leading the ratio to be lower than debt finance
competitors.
Asset Management
Our fixed asset turnover ratio is lower than the industry average because we have a high amount
of net fixed assets compared to our sales each year with the year 5 numbers approaching the
industry average. Our receivables turnover balance is lower than the industry average as we have
a high level of sales with a low level of end-of-year accounts receivables balance indicative of
our high prices and low debt. Our inventory turnover is 0 because we end each year with a 0-
inventory balance.
Profitability
By the end of year 5 our Return on assets ratio of 12% approaches the industry average of
10.5%. Our gross profit margin is near the industry average, indicating that our COS is like the
larger industry. Our operating profit margin also outperforms the competition in years 2-5 due to
our efficient reductions in cost over the other industry players.
DuPont Analysis
Our net profit margin is higher than the industry average as our operating expenses is lower than
competitors, resulting in having a higher net income compared to revenues. Our total asset
turnover is also consistently higher than the industry average as we expect to have a dominant
market share with high sale numbers. Our profitability leads us to have a significantly higher
equity multiplier showing the strength of investing in our company for stakeholders. Since we
use most of the equity financing our return on equity is lower than the industry average.
Valuation Method
Our estimated valuation is based off of the price/sales ratio for the aftermarket of automotives.
This industry showed the estimated value of Boat-Thru is 1.2x its’ yearly revenue, reaching a
maximum of just over 3.5 million throughout five years of business.

21
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Bios/Portfolios
Meet the Team - Section 3, Team 6
My name is Nikolas Talley. I am a junior at James Madison University and
am majoring in marketing with an expected graduation year of 2024. I
grew up in Mechanicsville, Virginia just north of Richmond. At JMU I am
a social chair for the Club Baseball team. After graduation, I plan to move
to North Carolina and go into Real-estate or a variation of sales.

My name is Benjamin Cousino, and I am a Finance major here at James

Madison University. My dad is in the military so I’m from everywhere but
most recently, Clifton, Virginia. Outside of school I spend a lot of time
with friends while following sports. I am also on the Club Baseball team.
After graduation, I would like to live in New York or Texas.
My name is Alexander Barna (They/Them). I grew up just outside Tysons
Corner Virginia. I am currently a junior accounting major with a minor in
criminal justice. When I graduate, I will become a forensic accountant
either with a law enforcement agency or advocacy group like the SPLC or
ACLU. At JMU I am already beginning my accounting experience as
Treasurer of Madison Equality, JMU’s oldest student run organization.
My name is Matthew Carpenter. I am a junior accounting major with a
Mathematics minor from Ridgefield Connecticut. I am involved within
organizations around campus. I am a part of Student Ambassadors giving
tours of campus, I am head of recruitment for my fraternity Delta Upsilon,
and I also am a member of the cheer team. After graduation I hope to move
to Boston to start my business career in accounting.
My name is Jacob Carney. I am a military brat and have lived in 11 places,
so I do not necessarily have a hometown, although I have lived in the south
for most of my life. I love being outdoors and meeting new people. I am a
Computer Information Systems and Accounting major. When I graduate, I
plan to live in Nashville Tennessee, or Austin Texas.

My name is Heather Moore, and I am from Manassas, Virginia. I am

currently a Computer Information Systems major and am hoping to add a
minor soon. I am a member of the Association for Information Systems as
well as the Habitat Humanity club. I am looking into starting an
organization for people interested in cybersecurity soon as well. In my free
time, I like to hang out with friends and roommates, watch movies, and try
new local restaurants.
My name is Alex Walter, I am from Blacksburg, Virginia, and I am a
marketing major. On campus I am involved with organizations such as
JMUGive, Boarderline, Professional Sales, and Outdoor Adventure Club.
After graduation, I would like to live in Colorado or Montana. I like to
spend my free time with outdoor activities such as hiking, kayaking,
snowboarding, and swimming.

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