Watchdog UAV, LLC. Executive Summary. Objectives. Keys to Success. Property Surveillance UAV

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1 Watchdog UAV, LLC Executive Summary Watchdog UAV, LLC is a startup company devoted to providing affordable and reliable products for property surveillance purposes. Our initial product is a fully autonomous UAV system that can be launched from the user s personal computer via access to the internet. This exciting new product will target farmers and large property owners who have a need to check their property from remote locations. We will to provide quality service to our consumers and intend to branch into other markets. Objectives Watchdog UAV Yearly Sales and Profit Projections To sell 100 Watchdog UAV units in the first year, 200 units in the second year, and 300 units in the third year of production at a price of $1,500 each. To take 30% of the video surveillance market for customers who own property up to 450 acres. Keys to Success Offer our product at a competitive price below our competitors in attempt to attract customers, in the surveillance market, to our new product. To acquire immediate customer satisfaction through product performance that will lead to repeat sales. To initially provide an innovative product with tangibles that dominates the surveillance market which will then allow Watchdog UAV, LLC to progress into new product developments. 1

2 4. Market Summary 4.1 Market Analysis The Watchdog UAV, LLC target consumers will be owners who own land up to 450 acres with a need for an affordable surveillance system for their land. These consumers will mostly consist of farmers, but also can include land owners who frequently are out of town and would like to keep their property monitored in their absence. At startup, the company will enter a surveillance market that mostly consists of CropCam, a company that focuses on surveying agricultural land using an auto-piloted unmanned aerial vehicle, and many generic camera systems. As our company expands, different markets will be entered such as filming, sporting events, and possibly the military market. 4.2 Marketing Strategy The Watchdog UAV, LLC will market the product in many ways. One advertising strategy the company will use is social media. According to PewResearch, 72% of online adults, 18 and older, use social media, so the company will effectively use tweeting and Facebook posts to pitch the functionality and benefits the product will provide [1]. Another way this will be done is through online websites. The company plans to pay different websites to advertise the product by putting ads on their webpage. For the percentile that does not use social media or online sources, the company will print ads in top farming magazines. These market strategies will be able to be seen by potential customers on a daily basis because of their frequent use of websites, magazines, and social media sites. 4.3 Sales Projection Over the first three years of sales, the company plans to sell 600 units. In the startup year, the company will plan to sell 100 units. Since the product will be introduced to the market in this year, high production is not expected. In the second year, the company anticipates doubling the sales from the first year. By that point, the product will be properly advertised and customers will know the integrity of the company. In the third year of production, the company plans to maintain and improve by selling three hundred units. By this year, the company will have developed a positive reputation in the surveillance market and will be focused on maintaining customer satisfaction. During these years of sales, each unit will cost $1,000 to produce and will sell for $1,500 which will yield a $500 profit from each unit. This will produce $50,000 for sales in the first year, $100,000 in the second year, and $150,000 in the third year from unit sales only. 4.4 Manufacturing and Distribution Strategy During the first three years of production, the company will work out of a founding team member s garage area. This will include manufacturing and packaging the product in this area. Testing the product will also be done in an area owned by a founding team member. During these initial years, each of the team members will contribute to the manual labor needed to assemble, test, package, and sell the product. As the company begins to grow, a larger company building and land will be purchased or rented and employees will be hired to accommodate the growth of the company. This growth will allow the company to increase sales and help bring in more customers. 2

3 5. Organization Overview 5.1 Company Structure In the startup years of production, the founding members will handle all operations of the company. Juan Sanchez will focus on the financial aspects of the company. Jamal Brown will focus on manufacturing and repairs. Travis Priest will focus on marketing and customer service. Thomas Hartzler will focus on legal issues and sales. All members will take part in research and development and testing the products. The task of each member is listed below in Figure 5.1. Watchdog UAV, LLC Juan Sanchez Jamal Brown Travis Priest Thomas Hartzler Financial and Manufacturing and repairs Marketing and sales Legal issues and customer service Figure 5.1: Watchdog UAV, LLC operations 5.2 Personnel Plan Through the first three years of operation, the founding members will handle all tasks of the company. As the company expands, we will consider hiring extra employees to manage increased demand. Travis Priest and Thomas Hartzler will manage employees in the electrical hardware area of the company. These task will consists of soldering, hardware assembly, and testing of electrical components. Juan Sanchez and Jamal Brown will manage employees in the software aspects of the company. There will also hired employees to help with marketing, sales, and manufacturing of the product. 3

4 6. Financial Plan 6.1 Profit and Loss Watchdog UAV, LLC plans to sell 100 units the first year of production, 200 the second year, and 300 the third year. It will cost $1500 to manufacture each unit and the company will make a $1000 profit off each unit. In the first three years, the projected total sales is $600,000. Since the company will be run out of a team member s garage, there will not be any rent that has to be paid. However, there will be utilities such as light bill and phone and insurance that has to be paid. The company will pay for advertising of the product, such as social media and magazines, and will travel to trade shows along the mid-west to better get the product on the current market. After the first two years, more money will be set aside for traveling as the product gets more popular among today s farmers. The company will pay $1000 a year for insurance to insure our workspace and materials. The company will also set aside $200 a year for miscellaneous items such as small tools, zip ties, glue, and any other material needed to assemble the product. The company will set aside $1000 the first year, $2000 the second year, and $3000 the third year for capital expenditure to go toward a new building for the company in the future as it expands. The company will set aside $300 a year for depreciation of the workspace and the tools needed to assemble the product. The company will also pay back the loan it borrowed with $1000 the first year and $4500 the second and third year as sales increase and there is more profit. Table 6.1: Profit and Loss of startup Year1 Year2 Year3 Sales $150, $300, $450, Materials (cost of sales) $100, $200, $300, Subtotal (Cost of sales) $100, $200, $300, Gross Profit $50, $100, $150, Gross Profit (%) 33.33% 33.33% 33.33% OPERATING EXPENSES Utilities(Elec/Gas/Phone) $3, $3, $3, Insurance $1, $1, $1, Travel $1, $1, $3, Advertising $1, $1, $1, Capital Expenditure $1, $2, $3, Loan Payments $1, $4, $4, Misc $ $ $ Depreciation $ $ $ Total Operating Expenses $9, $14, $16, Operating Profit $40, $85, $133, Net Profit (before tax) $40, $85, $133, Taxes $12, $25, $39, Net Profit (after tax) $28, $60, $93, Net Profit/Sales 18.90% 20.04% 20.74% 4

5 6.2 Projected Cash Flow Table 6.2: Cash Flow during startup Startup (cash in bank at startup) Year1 Year2 Year3 INCOME (cash in) Sales $2, $150, $300, $450, Total Inflow $150, $300, $450, EXPENDITURE (cash out) Materials (cost of sales) $100, $200, $300, Utilities(Elec/Gas/Phone) $3, $3, $3, Insurance $1, $1, $1, Travel $1, $1, $3, Advertising $1, $1, $1, Capital Expenditure $1, $2, $3, Loan Payments $1, $4, $4, Misc $ $ $ Taxes $12, $25, $39, Total Outgo $121, $239, $356, Income less Expenditure $28, $60, $93, Cash Balance $2, $31, $91, $185,

6 6.3 Projected Balance Sheet Table 6.3: Balance Sheet of startup Startup Year1 Year2 Year3 Current Assets Cash Balance 2, , , , Subtotal 2, , , , Capital Assets (can be depreciated) Depreciation Subtotal Total Assets 2, , , , Liabilities Current Liabilities -10, , , , Total Liabilities -10, , , , Capital, aka Net Worth (assets-liabilities) 12, , , , Total Liabilities and Capital 2, , , ,

7 References: [1] "Social Networking Use." Pew Research Center RSS. N.p., Dec Web. 14 Apr